Microsoft Likely Lost Over $60,000 Per Kin Phone as Verizon Pulls the Plug
July 19, 2010 1:07 PM
comment(s) - last by
The phone was rumored to have sold around 8,000 units
Microsoft's Kin smartphones made Palm's struggling Pre look like marketing genius. Released exclusively on Verizon
about 2 months back
, the pair of phones marked the culmination of Microsoft's reportedly $500M USD
purchase of Danger
(makers of the Sidekick).
The phones lacked features found in Android, the iPhone, or other modern smartphones and were marketed with a series of controversy-laden ads. In the end they reportedly sold around 8,000 units.
Following Microsoft's decision to
pull the plug
on future Kin-related endeavors, Verizon this week decided that it had seen enough. It is
of the phones, pulling them from store shelves, and shipping the remaining supply (which is mostly untouched) back to Microsoft.
While it's no real skin off Verizon's back considering the carrier's well-packed stable of smart phones and plethora of smart phones, the metrics of the screw-up for Microsoft are staggering.
If you assume to $500M USD Danger purchase cost and that 8,000 units were sold, that works out to a cost to Microsoft of $62,500 per phone. At that rate Microsoft might as well have been giving away small bars of gold with a phone built in. And that's not even including the two years of engineering that Microsoft financed to launch the phone and the extensive advertising campaign.
readies Windows Phone 7
, its surely a bit nervous as it watches Verizon nail Kin's coffin shut. Its room for error in the smartphone arena is
close to exhausted
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RE: Management Fail
7/19/2010 2:00:49 PM
But why even bother with AT&T's poor network? Verizon currently has a $10 plan for "Advanced Feature Phones". That's exactly what catagory they should have been sold as. Instead, Verizon tried selling you an Aveo for the same monthly payment as a Corvette.
RE: Management Fail
7/19/2010 4:31:02 PM
Verizon or AT&T, doesn't matter. I am on the road about 6-8 months of the year and your favorite network is hated somewhere because of poor service/reception. Seen AT&T have full 3G signal where you could not get even an edge connection with Verizon and visa versa.....
Just depends on where you are at.......
RE: Management Fail
7/19/2010 9:52:13 PM
Sure, I didn't know VZ also had such a plan. They should have offered their phones on as many carriers as possible with these "lite" data plans though and it might have succeeded.
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