Ballmer saw his nice, fat bonus slashed in the wake of the failure of the Kin and the Microsoft tablet efforts. The bonus was cut despite the fact that Microsoft had its biggest year ever. Reuters report that the bonus Ballmer received was $670,000, equal to his salary.

That is a lot of green for sure, but the bonus could have been twice that amount had the Kin and the tablet efforts paid off. Reuters reports that the official factors for the bonus cut were according to documents, “unsuccessful launch of the Kin phone, loss of market share in the company’s mobile phone business, and the need for the company to pursue innovations to take advantage of new form factors.”

That was enough to take the shine off the Entertainment and Devices group, which had been glowing with their strong Xbox sales but still managed to post a $172m loss thanks to KIN’s demise.  Neither Microsoft nor Verizon has confirmed any official sales figures – we’ve heard as little as 503 or as many as 9,705 depending on unofficial sources – but we’ve a feeling those inevitable “failed tech” lists will end up having a KIN or two next to Clippy.

[via Electronista]

“We had a huge launch party on campus and I bet that party cost more than the amount of revenues we took in on the product.  As an employee, I am embarrassed.  As a shareholder, I am pissed.  It’s one thing to incubate products and bring them to a proof-of-concept to see what works, but it’s something else to launch.  I suspect we launched because we felt like we HAD to so we could save face because we were trying to build buzz, but overall – HUGE fail.” Anonymous Microsoft employee

Meanwhile over at Mini-Microsoft there’s an unsurprising tirade of negativity about Kin and the way the project was handled, together with some blame being shared around the company’s top management.  General Manager Matt Bencke is tipped as responsible for approving Verizon’s inflated data charges and “the one who used those projections to get the Danger deal through” while Terry Myerson and Andrew Lees both come in for criticism.

Update: Pocketnow is pointing to the Kin Facebook app – which has over 8,800 monthly active users – as evidence that Microsoft may well have sold more handsets than the 503 Gruber heard about.

Some users of the iPhone 4 started to report that their handsets were getting very hot. Some even reported that their device was locking itself due to overheating. Sony issued the new PS3 3.40 firmware Tuesday. The firmware added PlayStation Plus, Facebook, and more to the console.

iSuppli tore down the new iPhone 4 early in the week to see what was inside. The teardown artists figure the iPhone 4 costs about $187.51 to build for the 16GB version. With all the complaints and issues for users of the iPhone 4 it was little surprise to hear talk of class action suits spring up. The issues with poor reception are the reason for the class action talk.

Corsair announced early in the week that a security glitch with its Padlock 2 flash drive had been discovered. The glitch allowed the password to be removed without affecting the data leaving it vulnerable. Another new potential issue with the iPhone 4 surfaced this week with proximity sensor issues being reported. The sensors are said to randomly activate the screen during a call making it easy to hang up or mute the call you are on accidentally.

Hulu Plus was officially announced this week with more shows and in HD quality. The shows will stream to the iPhone, iPad, and various TVs. Tuesday we posted up our official iPhone 4 review. In the end, we say the new device is a worthwhile upgrade for any user of an older iPhone.

Wednesday brought a rumor that Verizon was set to launch LTE in several test markets in November and then offer LTE handsets in those markets on Black Friday. This would be an earlier launch for its LTE networks than previously expected. Street legal Tron lightcycles hit eBay for auction in the middle of the week. Every geek that likes Tron was drooling for one of the $35K beasts.

Dell was accused of trying to cover up sales of defective computers in 2003-2005. The machines allegedly had mainboards that would fail at a significant rate. Sony announced that some of its Vaio notebooks were overheating to the point of warping the plastic cases this week. The machines were under a recall issued and a new firmware was offered to fix the overheat problem.

Details of Android 3.0 codenamed Gingerbread surfaced midweek. Notable improvements included 720p displays and fragmentation. Amazon unveiled a new Kindle DX this week with a graphite color and a new screen. The screen offers 50% better contrast than the original for $379.

Microsoft officially killed off the Kin feature phones after sales were abysmal for the devices. Hopefully carriers and hardware makers get the point that questionable hardware with a high-priced data plan will not fly with consumers. Lucasfilm told Wicked Lasers to stop selling that sweet Pro Arctic Laser that we saw a week or so ago. The laser looks too much like a lightsaber for Lucasfilm’s comfort.

Apple PR announced that the emails allegedly from Steve Jobs telling a user that the iPhone 4 was “just a phone” were fake. Someone sent the emails as a hoax. That talk of a class action suit over the issues with the iPhone 4 came true. The first class action suit was filed in a Maryland court Wednesday.

Dell officially announced that it did not knowingly sell defective computers on Friday. This was in response to the allegations that Dell tried to cover up defective computers made earlier in the week. Friday we learned that the issues with signal strength on the iPhone 4 when held just right came down to an incorrect formula for calculating signal strength. A new firmware update is coming to fix the issue. Thanks for reading and have a safe holiday weekend!

The Best of R3 Media

Android 2.1 Update for Cliq and Cliq XT Delayed: When it comes to Android and Motorola, they do really well right out of the gate. Their phones, at least at launch, are something to be enticed about. However, as the months tick along, and Google’s busy releasing new updates for their mobile Operating System, Motorola has been remarkably hit-or-miss on the subject. And, truth be told, more miss than hit. After missing several announced dates for updating the Motorola Droid, the Cliq and Cliq XT were eagerly awaiting their update to Android 2.1 by the second quarter of 2010. Well, they missed that date, and on the last day they possibly could toss up a warning, they did. Telling customers the update’s still coming, but they don’t know when. So, if you’re holding your breath, might want to stop. Be good for your health. [via Android Community]

The Microsoft KIN is Dead: After being in the market for only 48 days, Microsoft has made the official decision to go ahead and kill off the KIN lineage. That means the Kin One and Kin Two are, from this point on, dead. Even if Verizon doesn’t want to admit it to themselves, or maybe customers, word came down from the higher-ups that the Redmond-based company is focusing on Windows Phone 7, and therefore they don’t have time for something like the KIN. So, bad news for those out there who purchased it, but good news for future Windows Phone 7 owners, hopefully. [via SlashGear]

LG Sentio Finally Released: It had been broke from cover a few months ago, and now the LG Sentio is finally official. So official in fact, that T-Mobile is actually selling it right now. So, if you’re in the market for a mid-range touchscreen device, featuring a 3-inch display, and social networking features to make sure that you get caught up with all your friends all the time, then go ahead and get ready to drop $69.99 on a new, two-year contract, and after a $50 mail-in rebate. Or you could just but it out-right for $179.99. Your call. [via PhoneMag]

The Dredge ‘Net

Kindle Turns to HTML 5: Right now, Amazon’s Kindle application for Apple’s iOS is far more useful and feature-packed than the actual Kindle itself, but we won’t worry about that right now. And, they’ve just released the Kindle for Android application, too. But what about the PC? Well, if you want to grab a preview of a book you’re interested in, you’ll be abel to do that without opening another application. You just need to swear your allegiance to HTML 5, and you’ll be able to read a chapter or two before you decide to buy anything. Good plan, Amazon. [via Ubergizmo]

Windows Any Time Upgrade Ends Saturday: All good things must come to an end. And in classic Microsoft tradition, their period of offering cheaper upgrades to their current generation Operating Systems is coming to an end yet again. If you currently find yourself on Windows 7 Starter Edition, and you were hoping to nab an upgrade to Home Premium for only $50, then you need to act now. Or if you’re on Home Premium and want to jump up to Professional for $79.99, then your time is runnig out. Micrsoft is pulling the plug on the cheap updates this Saturday, so you’ll be expected to pay the full price — $79.99 and $89.99 respectively. Anyone going to jump on this before time runs out? [via Engadget]

“We have made the decision to focus exclusively on Windows Phone 7 and we will not ship Kin in Europe this fall as planned. Additionally, we are integrating our Kin team with the Windows Phone 7 team, incorporating valuable ideas and technologies from Kin into future Windows Phone releases. We will continue to work with Verizon in the U.S. to sell current KIN phones.”

While it may make sense that Microsoft would want to focus on Windows Phone 7, it’s one of those things that maybe they should have done before the launch of the Kin devices. Whether or not one can consider this a failed experiment or not is probably up to personal opinion, but if this means that Microsoft is putting the full weight of R&D behind Windows Phone 7, then we’re all for it.

[via PhoneMag]

First off – teenagers do not use phones the way adults do – while we both communicate, our goal is to communicate socially. We talk constantly, are always hanging out with friends, Facebook and tweet every aspect of our lives. A mobile device for teenagers needs to be based on that. Ultimately I’ve seen that there are only 4, at best, features of a phone that teens ever use – texting, calling, pictures/video, and occasionally music. That’s it. Understanding that is critical for getting what KIN is doing for teenagers.

The entire phone is built around what teenagers use phones for – communication. The Loop, live feeding to your phone everything everyone you know is saying, doing – and allowing you to share it with anyone with the Spot – are both huge. Not only that though, but also allowing the transfer from the phone to a computer, through Studio. Having everything stored up in the cloud, backing it up, letting you store it, save it, and share it even further is a brilliant extension of how teenagers use phones, and works great – syncing within minutes. Even the camera is built around this idea – not just taking pictures, but giving you way to get all those pictures off your phone – straight to Studio, to Facebook, to Myspace – to all your friends, everywhere.

The concept of KIN is perfect for teens. As to how it actually holds up: I was able to get some time with both devices today. I can say that the hardware is excellent – the full keyboard is great for texting, even on the smaller KIN One. Speed was excellent – despite the effects of the interface, lag or loading times were never an issue. The camera, especially the KIN 2’s 8.0 megapixel one, are great, with some really nice hires images. Zune playback and syncing are almost identical to the Zune HD – which is a very good thing, while the use of a real headphone port makes this an actually useable feature. Using a Zune Pass makes this even nicer – since it gives you the musical equivalent of Studio – online storage for all the music you could ever listen to. Texting is particularly well done, treating texts as conversations – allowing you to manage and even add in or remove people from the discussion. The email app and browser are average – useful for the occasional lookup – which is all that teens will ever need it for. The integration of contacts is incredible – literally, just log into Facebook, and the KIN does the rest – setting up all your friends. And Studio backs it all up – so if you get a new phone, it’s as simple as just logging in again – and everything syncs back.

As for the KIN-features – Loop, Spot, and Studio. Loop is great – making the home screen of your phone your complete social network and news feed. Spot, the ever-present dot on the bottom of your screen, allows you to share everything to anyone – through MMS, Email, or Facebook/Twitter/Myspace. Studio is particularly impressive – a complete online companion for all the features of your phone – complete with a Loop and Spot of it’s own. Contacts, Pictures, Videos, Favorites, are all kept in perfect sync, and it just works. No setup, no complex linking or transferring. Just log in, and its there.

As for pricing – the $49 and $99 price points for the KIN 1 and the higher end KIN 2 are perfect to reach the teenage market. Furthermore, the phones don’t need special plans – you can just get one as you can any Verizon phone. The big point though, is data: $30 a month, in addition to regular costs. On the one hand, it’s a little high for teens, but considering that it includes unlimited data per month, as well as unlimited storage on Studio makes it much easier to accept. A flat fee that teens won’t have to worry about paying extra for going over a limit, and unlimited space on Studio to store everything is exactly what needed to be offered to make this appealing enough for teens at the price.

In essence, KIN takes the phone – which, for teenagers, was limited mainly to personal communication – and extends it to social as well – giving us equal access to an equally if not more important part of our lives. And it does it in a way of simplicity and ease of use. It may not offer everything that can possibly be stuffed into a phone, but sometimes, the thing that doesn’t do everything may just do exactly what the user – in this case, teenagers – want. Yes, there are phones out there that offer more, but the features they offer aren’t really used by teenagers on phones. The four – call, text, pictures, and music – that do matter, aren’t cut out of KIN, but expanded by it. KIN doesn’t limit to what a phone can be used for, but extends what the phones of teens do for us.

Kin hands-on video from launch day:

Device pricing – The KIN One is $49 and the KIN Two is $99. That price includes a $100 rebate. That’s pretty reasonable and in line with most high end feature or low end “smart” devices. The truth is KIN is neither of those things, although I expect a lot of folks to compare it to one, the other or both. The reality is the KIN is really a cloud phone. Its value is derived from cloud services, as well as the KIN Studio on the web. There’s a lot that’s different about these devices and a good deal of what Microsoft does here will be dependent on how well they can message this to their target demographic.

Service pricing – No matter how the market defines the phone, Verizon clearly looks at the KIN family as smartphones and therefore they require the smartphone data plan of $29.99. I don’t think this is an issue for the older demographic using the device but certainly might be an issue short term for younger audiences. Ideally, pricing could have been one of the differentiators of the devices as they came to market. At this point KIN will need to separate itself from devices like BlackBerry or the HTC Incredible on Verizon as well as iPhone on AT&T. It’s not a going to hurt the device vision long term but it makes the story a lot harder to tell.

The KIN Experience – I spent the better part of today working through the devices and I mostly like what I saw. Most folks who I showed both devices agreed that the KIN One was somewhat more compelling visually. The KIN Two looks like a nice generic slider. KIN One is 4GB and KIN Two 8GB, and as storage is mostly used as cache, that’s not as big a difference as you might think. Music can be synced through the Zune client. Mac music sync will be available but wasn’t at press time. The camera on K2 is also higher resolution and can do Hi-Def video (but Hi-Def video isn’t synced to the cloud).

The Out of Box experience was pretty straightforward. Enter your Live ID, add in your credentials for Facebook, Twitter, MySpace and Windows Live and you’re good to go. You can define favorites, add in RSS feeds, and add in mail support for most popular services, including Exchange. Contacts are limited to social networks and there’s no calendar feature. I had no problem seeing my Google calendar through the web interface. Music is handled through Zune Pass and can be streamed live. It’s a great feature and I suspect KIN will do a lot to help drive more Zune users.

Overall performance is pretty snappy, thanks in no small part to the Tegra chip powering the device. There’s great fluidity to the experience and it feels quite natural to use. The social experiences are well integrated but varied. For example I can send photos to Facebook and MySpace but not Twitter. Likewise, basics like @replies must be done from the status bar “command line” style instead of clicking on a tweet and responding. Twitter integration overall is pretty low and is something I hope gets more robust over time.

The KIN camera is excellent on both devices and snapping and sharing happens quickly and easily once you grasp the overall KIN metaphor, which takes a few minutes to get comfortable with.

One of the real beautiful parts of KIN is the Studio, a web based app that gives you a reflection of what’s on your device and is your long term storage option. Content flows seamlessly from the device to web with older content being archived to the web interface. You can mark pictures to stay on the device if you want them there all the time. In practice, the device-res version of the image stays on the phone – only the high res image goes up to the cloud. So, although Favorites keeps the whole image on there and promotes it, the user never has images they took unexpectedly disappear from the device.

The Studio experience is fluid, rich and visually appealing. This is one of the hallmarks of the device and it’s something that Microsoft needs to show off to demonstrate the full value of the KIN experience.

Bottom line? KIN is something new. It’s not a feature phone or a smartphone. It’s something different with aspects of both. I’ve talked in the past at how this is likely to appeal to a specific demographic and psychographic that’s socially connected. Is it the phone for me? Probably not. I’m closer to Gen AARP than Gen Upload and I need my device to do different things. (although I’d love to see a Studio type feature as part of all Windows phones along with Mac music sync). Is there a market for KIN? Absolutely. The key challenge will be how well Microsoft and Verizon can tell the KIN story to the target market. Neither the analysts, pundits or journalists will make or break this platform, the real and only question is how well the message resonates with target audience.

Kin hands-on video from launch day: