WSJ(3/19):Palm Will Unveil New Series Of Hand-Held Computers
Dow Jones News Service ~ March 18, 2001 ~ 9:14 pm EST
By Pui-Wing Tam
Staff Reporter of The Wall Street Journal
Say hello to the Generation Y of hand-held computers.
Palm Inc. is today unveiling its next-generation series of personal digital assistants. Its new gadgets, the Palm m500 and Palm m505, are nearly as thin and light as the best-selling Palm V gizmos and also feature a bundle of new capabilities. The highlights: Sleek models with color screens, postage stamp- size expansion slots, software that shows off digital photos and video footage, as well as an updated operating system that boosts the hand-held computer's wireless connectivity.
The debut of the new Palms coincides with a barrage of other new introductions of hand-held devices. During the past two weeks, Compaq Computer Corp., Handspring Inc., and Sony Corp. all have announced new hand-held computers to flesh out their existing families of mobile gadgets. More releases are on the way. In a few days, Hewlett-Packard Co. will introduce an updated version of its HP Jornada hand-held computer.
The arrival of these next-generation gadgets sets the stage for how hand-held computing will look and work in the future. When the original Palm Pilot hit store shelves in 1996, the clunky black-and-white screen machines were hailed for their ease of use for simple functions, such as keeping track of phone numbers, addresses and appointments. Now in their latest iterations, the devices are slimmer, with color screens, multimedia functions, and expansion slots that allow users to plug in everything from digital cameras to MP3 digital-music players.
And of course these devices are no longer just custodians of calendars and contacts. Instead, the gizmos are increasingly wireless, capable of accessing the Internet and in some cases even making phone calls. The new Palm m505, for instance, will come bundled with software and an updated operating system -- Palm OS 4 -- that permits users to connect the device to mobile phones, instantly send short messages to each other, and hook into the Internet. Other companies are creating modules featuring Bluetooth, a wireless technology that works over short distances, which will slot into the devices. And both Palm and Microsoft Corp. say they are embedding more wireless capabilities into their hand-held software, so that the gadgets will ultimately become more like standalone computing units.
The new class of hand-helds has "a good combination of elements that sets the future direction for the devices," says John Cook, senior director of product marketing at Palm, Santa Clara, Calif. "We're starting to see the underpinnings for all types of wireless communication and sharing of information, which are all hints of the future."
But the big question: Will consumers really want all these new bells and whistles on their devices? Ken Dulaney, an analyst at Gartner Group in San Jose, Calif., says keeping track of appointments and phone numbers still is the main reason many people use a hand-held computer. Adding new functions simply jacks up the price of the gizmos -- for example, the Palm m500 will retail for $399 and the m505 will sell for $449. That compares with the $150 price point for the lower-end Palm m100 series.
The new products are certainly making their debuts at a risky time. During the past few months, the technology sector has been walloped by weak sales of everything from networking equipment to personal computers. Yet analysts say hand-held gadgets aren't as likely to be affected by the slowdown since the industry is still in its early growth stages. While some Wall Street analysts have modestly scaled back projections for hand-held device sales for this quarter, others say the new products may help spur more growth in the hand-held market. "Hand-held-device makers are giving customers a reason to upgrade," says Kevin Burden, an analyst at International Data Corp.
Devices based on Palm's software, including Palm, Handspring and Sony hand- held computers, account for about 87% of the U.S. market. Meanwhile, hand-held gadgets that rely on Microsoft's Pocket PC software, including those from Hewlett-Packard, Casio Computer Co. and Compaq, have about a 12% share, according to market tracker NPD Intelect. Mr. Burden suspects the market shares of these companies will be shored up by the new product introductions. "Everyone will cement their positions," he says.
Donna Dubinsky, chief executive of Handspring, Mountain View, Calif., adds that what appeals to consumers are devices that are innovative and provide new capabilities. "Substantial innovation is required in this competitive space," says Ms. Dubinsky. "What's succeeding is products that move the ball forward."
Handspring's new offering, the Visor Edge, was unveiled last week. The $399 gadget with eight megabytes of memory boasts many characteristics similar to other next-generation hand-helds. Visor Edge is, for instance, one of the thinner and lighter devices on the market, at less than half an inch thick and weighing 4.8 ounces. It also is modular, coming with an attachment that slides onto the device. The attachment permits users to plug in other modules, such as a digital camera, to the device.
Meanwhile, Japanese electronics giant Sony Corp. last week presented an updated version of its hand-held computer, dubbed Clie, in Japan. Unlike its predecessor, the new Clie has a sharp color screen and more multimedia traits, including a newly added audio playback function, plus headphones. The machine, available only in Japan at this time, is priced at about 50,000 yen ($408).
Compaq, Houston, also recently announced an enhanced iPaq hand-held computer. In a sign of how robust the devices are becoming, the new $649 product boasts a whopping 64 megabytes of memory, a color screen, and an expansion pack that allows consumers to plug in two PC cards. And Hewlett-Packard on Wednesday plans to debut its HP Jornada 525, a $359 color-screen device; the Palo Alto, Calif., company also has disclosed plans to create an integrated wireless machine combining hand-held and mobile-phone functions for later this year.
What's next? Consumers should expect a continued trend to lighter, thinner hand-held computers with more built-in wireless capability. Phil Holden, marketing director of mobile devices at Microsoft, Redmond, Wash., says his team has been working with Texas Instruments Inc. during the past 18 months to reduce the number of components needed to make the Pocket PC hand-helds based on Microsoft software. The result: Much thinner devices that will likely look similar to the Palm m500 and the Visor Edge.
Mr. Holden adds that Microsoft's Pocket PC group is working on new wireless functions. "We'll have more wireless capability built in for new hardware that will come out by the end of the year," he says.
And Michael Mace, Palm's chief competitive officer, also recently laid out a road map for the company's hardware and software releases for the next 18 months. In the second half of 2001, he says Palm will likely announce next- generation integrated wireless devices that support real-time e-mail reception and delivery, as well as higher-resolution screens. Sometime in 2002, he adds, the company will also introduce a new operating system, Palm OS 5, which will form the foundation for enhanced audio and video capability.
(END) DOW JONES NEWS 03-18-01
09:14 PM |
