nandemoari writes "T-Mobile is taking a huge financial hit in the fallout over the Sidekick data loss. But Microsoft, which bears at least part of the responsibility for the mistake, is paying the price with its reputation. As reported earlier this week, the phone network had to admit that some users' data had been permanently lost due to a problem with a server run by Microsoft-owned company Danger. The handset works by storing data such as contacts and appointments on a remote computer rather than on the phone itself. BBC news reports today that Microsoft has in fact recovered all data, but a minority are still affected (out of 1 million subscribers). Amidst this, Microsoft appears not to have suffered any financial damage. However, it seems certain that its relationship with T-Mobile will have taken a major knock. The software giant is also the target of some very bad publicity as critics question how on earth it failed to put in place adequate back-ups of the data. That could seriously damage the potential success of the firm's other 'cloud computing' plans, such as web-only editions of Office."
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