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Microsoft buys Danger, maker of the Sidekick

Microsoft may be hitting a rough patch with its biggest Silicon Valley acquisition but Yahoo is hardly the only company it’s after. The Redmond company announced today it was buying Palo Alto-based Danger, which makes the software and services that go into phones like the Sidekick from T-Mobile. The terms of the deal have not been announced.

The Sidekick has been one of T-Mobile’s best selling phones, especially with younger consumers who have taken to its cool design, flip out keyboard and easy interface. With Microsoft working to expand the appeal of its Windows Mobile operating system to consumers, the pick up of Danger would help it reach out to particularly younger customers.

“Microsoft is a global leader with our Windows Mobile software and expanding mobile services,” said Robbie Bach, president of the Entertainment and Devices Division at Microsoft. “The addition of Danger serves as a perfect complement to our existing software and services, and also strengthens our dedication to improving mobile experiences centered around individuals and what they like.”

And with the competition from the iPhone heating up each month, it allows Microsoft to rely on Danger’s 10-years of experience in the consumer market to counter Apple’s surge in the marketplace. Recent studies have shown that the iPhone is outselling all Windows Mobile smart phones in the U.S. after less than a year of sales.

Microsoft is excited about combining Danger’s expertise in Web browsing and e-mail, instant messaging, games, multimedia, and social networking with Microsoft’s MSN and Windows Live properties. They’re also talking about creating connections between Danger’s services and Microsoft’s other consumer technologies such as Xbox and Zune.

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