Yahoo's board may have rejected its takeover bid, but that doesn't mean that Microsoft can't find other companies willing to become part of its empire.

In what must have been a much friendlier transaction, Microsoft said today that it is buying Danger, the company behind the T-Mobile Sidekick. Although the move puts it directly into the cell phone hardware business, Danger uses a proprietary operating system, not Windows Mobile, CNET's Crave site says. That should make for some interesting integration issues.

Robbie Bach, president of Microsoft's entertainment unit said in a statement that Danger complements his company's current software and services and "strengthens our dedication to improving mobile experiences centered around individuals and what they like."

Financial terms of the deal were not disclosed.