Microsoft Should Pay a Fat Dividend

Microsoft(MSFT) is currently in the midst of what should be its new dawn as a company.

Bill Gates has left the building. It's Steve Ballmer's show to run the company, which is currently in a massive upgrade cycle with a new operating system (Windows 7) and a new Office suite of applications. Yet the stock is going nowhere.

Investors have been waiting for some time for Microsoft to get its act together. They're still waiting. Four years ago, David Einhorn said that buying Microsoft at $23 was like getting Alex Rodriguez for next to nothing in a fantasy league baseball draft. After last week, it's back at $23 again.

There are many things going right for Microsoft, and investors are hoping to hear about many of them on the July 22 earnings call. They're hoping to hear good things from Client, Office, the Business divisions and cloud computing, where Microsoft is making strides.

However, investors will have to do their usual holding of breath to see how Microsoft's Online Services group and Xbox products do. Did Bing gain another 0.2% in the quarter? This is gripping stuff.

On the other hand, with the merciful self-killing of the not-so-hip Kin phone a few weeks ago, don't expect much from Microsoft about its plans on branching away from the PC to mobile-connected devices. No, that's a war being waged between Apple(AAPL), Google's(GOOG) Android software, Research In Motion(RIMM) and to a lesser extent Nokia(NOK).

I never did understand the Kin (although I wasn't the 18-year-old in their demographic). The phone was supposed to keep me socially networked to all my friends just like every other phone can do. It looked like a pocket-sized circle, so maybe they thought they'd get points for modern art-like innovation.

But the coup de grace -- or so the phone experts at Microsoft thought -- was going to be the way the Kin phone made users dependent on going back to their PCs so they could manipulate all the data like photos, notes and updates that they created on their phones during the day.