Microsoft Buys Another Desperate Company: Danger Goes To Redmond

from the danger,-danger,-bill-gates dept

It would appear that Microsoft's M&A team isn't solely focused on Yahoo these days. Back in December, we noted that Danger, makers of the Sidekick mobile phone device, was planning to IPO, despite not having a track record worth an IPO. As we noted at the time, it seemed like the company was going to IPO because that was its only option. The truth is probably that the company was desperately looking for a buyout, and now Microsoft has come through. It will be worth watching to see what Microsoft does with Danger, as Danger does not use Microsoft's operating system, and its model is not based on licensing software, but in taking a toll from service fees. It would take quite a bit of effort to pull out Danger's OS, which was very carefully designed for the device itself, and replace it with Windows Mobile (and it also might lead Sidekick fans to flee to other devices). All in all, it's an odd sort of acquisition for Microsoft. One would hope that the company actually has more specific plans on what to do with Danger, because the obvious fit isn't apparent. From Danger's perspective, though, an acquisition by anyone at this point has to be viewed as a better option than trying to IPO, which almost definitely would have been a disaster.
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Filed Under: desperation, mergers
Companies: danger, microsoft


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  1. identicon
    Joel Coehoorn, 11 Feb 2008 @ 12:01pm

    Keeping up with Google

    It's simple: Microsoft has to keep up with Google and Apple. They made moves into the cell phone area with iPhone and Android. Now Microsoft needs to make it's phone play. The investment required to get windows mobile running on the sidekick will be significant, but it's a fraction of what it cost to purchase the company so perhaps MS feels it's justified.

    What is surprising is that a lot of the value in this purchase is the Sidekick brand, but MS already has a mobile brand in the Zune if all it wants to do is match Apple. Don't be surprised to see a new phone released as the Zune Sidekick, or some mashup like that.

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