I imagine this was a case where everything was in planning and development for a long time and they thought maybe they could take a shot in the dark at recouping those costs, knowing full well that it would probably fail. Should have just canned the project and devoted the resources to Windows Phone 7 as soon as that was deemed the future for their mobile division. Textbook lesson in how not to handle sunk costs.
And devoting resources to Win Phone 7 is going to be a big win? How does one know? What if Kin caught on and Win Phone 7 flopped? Some people would be praising the Kin team and others would be making fun of MS for wasting their time with Win Phone 7.
I think all of these mobile efforts by MS are doomed, but I don't see why Kin was a worse idea than WP7.
I think it's pretty obvious that Kin is ignorant of the current landscape but Windows Phone 7 is at least cognizant of it. The chances for success are still slim, but they're at least a little better.
You know what I'd rather have than a Win Phone 7? Something I'd pay money for. A decent mobile office app for my Android. That's the kind of thing MS should be focusing on now. They've missed the boat with the platform, time to pivot and start building the applications.