Palm Inc. Promises New Features:
By MAY WONG, AP Technology Writer
SANTA CLARA, Calif. (AP) - At a Palm Inc. software developers' conference this week, battle lines were drawn for the formidable challenge the world's leading maker of handheld computers expects to wage in 2001 with Microsoft Corp.
As the Internet goes wireless and people begin to rely more and more on handheld devices, Palm will be hard pressed to defend its operating system's ownership of three-quarters of the market.
Some analysts even predict Microsoft will cut Palm's market share to 51 percent by 2005.
``This is a tremendous growth market, and there is a keen interest in staying competitive with that company up north,'' Palm CEO Carl Yankowski told a group of reporters as his company offered a preview of its next-generation tools and features.
Personal digital assistants are among the hottest-selling gadgets around.
Palm says it has sold more than 8.7 million PDAs since introducing the PalmPilot in 1996. This year alone, 4.4 million handhelds using the Palm operating system will have been sold - including those of year-old rival Handspring, according to International Data Corp.
IDC projects, however, that Microsoft will essentially double its market share in operating platforms from the current 18 percent within four years.
Santa Clara may be Palm's home turf.
But that wasn't keeping Microsoft from living up to its aggressive industry reputation by hosting a separate, invitation-only reception for developers during the Palm event.
``Palm certainly has a lot of users, and there are applications that their users can't live without. We're interested in talking to those people who are building those applications,'' said Ed Suwanjindar, product manager for Microsoft's mobile devices division.
Microsoft currently has a more robust, multimedia-friendly handheld platform, and Palm has no illusions.
At the conference, Palm said it planned to support ARM-based microprocessors, which would allow PDAs to better support demanding applications including streaming video, in its version 5.0 operating system, due in 2002.
The promise brought cheers and applause from some of the 4,000 developers, who didn't get excited again until supermodel Claudia Schiffer appeared to show off a special metallic blue Palm named after her.
Competing devices from Compaq Computer Corp. and Hewlett-Packard Co. running Microsoft's Pocket PC operating system already use ARM-based chips.
``Wireless is huge, and if you don't get it into your devices - you're in trouble,'' said Lonnon Foster, a Palm client developer with Wavelink and author of ``The Palm OS Programming Bible.''
The Boston-based Yankee Group estimates there will be more than 1 billion Web-enabled mobile devices worldwide by 2003, generating nearly two-thirds of all Web transactions.
The Palm VII (news - web sites) already offers wireless Internet access and the company now sells a kit to enable mobile Internet over lower-end Palm devices. But Palm lags in wireless features.
Handspring, for example, has expansion slots in its Visor PDA that accommodate a wireless modem, a cellphone or a module that uses Bluetooth short-range radio technology.
Bluetooth allows devices to communicate untethered within a 30-foot range. It is considered a key emerging standard for communicating with everything from PCs to garage doors.
``Palm was the first to have a built-in modem in its (Palm VII) devices, but for them to be truly successful, they'll have to make every Palm pilot wirelessly enabled,'' said Tim Bajarin, an analyst with Creative Strategies.
Palm's next big move is the introduction, in the first half of 2001, of version 4.0 of the Palm OS, which will support Bluetooth and wireless telephony. Palm also plans to introduce expansion slot options, the company says, that would allow for expanded storage, telephony, multimedia and Bluetooth uses.
And it is licensing the OS to other companies.
Samsung Electronics is joining Nokia, Motorola and Kyocera in marketing a ``smartphone'' that uses the Palm OS to integrate Internet surfing and e-mail into a cellphone. Future OSes also will support higher screen resolutions and richer color - another area where Palm is behind.
Firepad, which makes video and graphics applications exclusively for Palm OS devices, has run up against limitations such as Palm's 8-bit color in its Palm IIIc models. Handspring's Visor and some Windows devices feature 16-bit color support.
Still, Firepad said it plans to stick to developing solely for Palm operating systems and will take advantage of its upcoming new features, that could support streaming video.
``Multimedia is the one area where Microsoft is trying to break Palm's armor, and our application will close that hole,'' said Mike Grenier, a business development manager at Firepad.
Palm executives hinted that the company one day may consider splitting its handheld device and operating system licensing businesses.
They are beginning to see an important share of income - revenues for the quarter ending Sept. 1 jumped to $401 million from $176.5 million a year ago - from the licensing of their operating system.
Which had company chief competitive officer Michael Mace exuding confidence that partnerships with companies including Nokia and Motorola would fortify Palm in its coming struggles with Microsoft.
Diminished market share? Humbug!
``In the last three years, third-party analysts have said that Palm was about to decline in the next year,'' Mace said. ``Instead, Palm has grown tremendously and we think that's going to continue next year.'' |
