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Ms does this kind of thing all the time (so does Apple). They design dozens of products that never see the light of day.

It was obvious to me that once this thing hit user acceptance testing (if it ever got that far), it would die.

its one of those things that looks great in a video, but when you have it in your hand and have to use it for something, it falls far short of it's intended purpose.

I am sure they lost as much money as they expected to lose on it. It could have also just been a ploy to try and keep the iPad from selling. The carrot on a stick kind of thing. I don't think it was that however.