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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: mightylakers who wrote (6705)	1/30/2001 8:15:26 AM
From: jackmore	Respond to of 197304

UPDATE 3-Motorola withdrawal savages Psion (Adds CEO comments, analyst, closing share price) By Richard Meares and David Holmes LONDON, Jan 29 (Reuters) - Psion shares were savaged on Monday after it said Motorola (NYSE:MOT) had pulled out of a key project to create "smartphones", dealing Europe's biggest handheld computer maker what one analyst called a bodyblow. The stock lost nearly a fifth of their worth to close at 210-3/4 pence, a 16-month closing low and wiping some 210 million pounds ($306 million) off Psion's market value. Chief Executive David Levin told a conference call the collapse of the partnership would cut about 12 million pounds off pre-tax profits for 2001 as a result of the extra development costs and lost profits from the project. Analysts were expecting Psion profits in a range from 11.4 to 27.5 million for the year, according to Barra estimates. "This news really is bad, it is a bodyblow for them because Psion has got really little new-product launch this year and that was to be it," said Nomura analyst Keith Woolcock. Psion said it would carry on alone with the extra costs and delays. Psion, which lost a quarter of its value in October when it issued a profit warning, added to the grim news by saying the division incorporating its big acquisition of last year, Canada's Teklogix, had not performed as well as had been hoped. The Motorola announcement came late in the day but the fall in Psion shares began in the morning after a media report it was losing share in the European handheld computer market, mainly to its chief rival Palm (NASDAQ:PALM). Trying to counter the report of falling sales, Psion said it shipped over half a million palmtop units in 2000, two thirds more than a year before. Speculation of a possible linkup with Palm helped revive the stock a bit before the Motorola news crashed onto the market. SYMBIAN STILL WINNING, PSION SAYS Psion and Motorola will stop jointly developing wireless information devices, which were to use the EPOC operating system of Symbian -- a consortium Psion leads and which includes phone makers Motorola, Ericsson (LMEb) and Nokia (NOK1V). Motorola said the move was to streamline its product range, but said it would continue to develop alone a mobile "smartphone" based on EPOC, due on the market next year. Psion's Levin said this gave support to his company's view that Symbian was "winning the wireless war" against rival operating systems offered by Palm and by Microsoft (NASDAQ:MSFT). Psion will press on with a range of wireless devices, the first of which should have hit the market in the middle of this year but would now be delayed until the first half of 2002. "We are talking to a variety of possible partners," a spokesman said. Psion does not have the resources or the wireless phone technology to do it alone. The damage of the delay is attenuated somewhat by the fact that GPRS, a new mobile telephone technology that enhances current networks' access to the Internet and for which the new devices are meant, is itself behind schedule across Europe. But the news was still a black cloud enshrouding Psion, which had hoped the tie-up with one of the world's biggest mobile phone makers would boost its fortunes and make it a force to be reckoned with in the Palm-dominated U.S. market. WIDS Wireless information devices are basically mobile phones combined with handheld or palmtop computers. The "smartphone" end of the range that Motorola is sticking with will be more like a souped-up cellphone, whereas the "communicator" that Psion is carrying on with is more like a more powerful palmtop that is also a phone. Nomura's Woolcock said it was clear Psion now needed a partner for its handheld computers division. The company's shares have now underperformed the FTSE all-share index by 60 percent over a year. Motorola will have paid $8 million towards the joint development which it forfeits by pulling out. To save money in the Teklogix division, manufacturing will be centralised at Mississauga in Canada, with 100 jobs being cut in Britain at Didcot near Oxford. Levin said this would save 2.6 million pounds in 2001 as a one-off, and bring annual savings of three million pounds -- of which 1.2 million were expected to be realised in 2001. siliconinvestor.com