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Microsoft Loses the Computing Plot

Stocks in this article: MSFT AAPL GOOG

What lies beyond touch? Gestures. Fingers, hands and arms moving in the air, remote control without the controller.

Microsoft has a play here, called Kinect. Invented in 2005, launched for its game machine in 2010, and for Windows last year, Kinect uses cameras, sensors and software to interpret your movements as computer commands. Microsoft handed it off to developers, who were initially excited by its possibilities. It gives a robot eyes.

But Microsoft didn't develop Kinect further, nor did it push Kinect as a computer product. A start-up called Leap Motion, launched the same year the Kinect first shipped, has done that, and come up with a device no bigger than a USB drive that you can see in this YouTube video.

Although the Kinect works at room distances -- it was designed to compete with Nintendo's Wii game controller -- Leap focuses on hands and fingers, on desktop distances. If you're holding something, Leap will recognize it, turning that object's movements into computer commands. Hold a pencil in the air, make scribbling motions, and Leap will interpret that handwriting.

Even before it launches -- and the product doesn't ship until May 13 -- it has its own app store, called Airspaces. It costs a third of what the Kinect controller does, and because it's not from Microsoft it will work with any device: Macs, iOS, Android, whatever you've got. Plus Windows.

Leap, in short, is what Kinect should have been, and it will take Microsoft's competitors beyond where Kinect can go, even before Kinect gets there.

If that's not losing the plot, I don't know what is. Microsoft needs a quarterback, not a blocking back. Like IBM (IBM) 30 years ago, it has become vulnerable to the first "kids with a clue" who came along: the guys at Leap Motion.

Sadly, I agree with Rocco.

At the time of publication, the author was long IBM, GOOG and AAPL.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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