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To: JGoren who wrote (25600)	3/30/1999 10:28:00 PM
From: Sawtooth	Respond to of 152472

Palm Computing chief discusses the 'Zen of Palm' - Mentions QualComm. By Darren Gladstone 03/30/99 07:35:00 PM ZDNet Related Stories - What 3Com Has Up Its Sleeve for Handhelds - Latest Palm organizers deserve a hand - Mobile technology grabs the spotlight at CeBIT - Palm VII aims to tame wireless market Robin Abrams took over as president of 3Com Corp.'s (Nasdaq:COMS) Palm Computing Division just over a month ago. Since then, the Palm V and Palm IIIx have reached store shelves, while the Palm VII waits in the wings for a possible summer release. Staff Writer Darren Gladstone recently caught up with Abrams in Santa Clara, Calif., to discuss the future of the Palm computing platform. PC WEEK: Where does Palm Computing see itself today, as opposed to 1996 when it all began? ABRAMS: As a market leader and pioneer. We've gone from zero to over 3 million units in less than three years. And it is not just the consumer (we are distributing to). It is enterprises, and we're going to see different market behavior, different characteristics than we've ever seen before. We have just released the IIIx and the V. So we now have a good, better, best offering and it looks like a traditional price/performance curve. It's no longer the early adopters or techies who are taking notice. PC WEEK: What makes you say that? ABRAMS: Volumes, for one. Watching with my own eyes in Germany (at CeBIT) who's in the booth. They are individual and enterprise consumers alike. At 3Com, we get more calls from CIOs and CFOs to division heads and department heads than from individual customers. They call with questions like, "How can I make this work for my company?" We have over 15,000 developers worldwide. PC WEEK: So the growth is there, but the challenge remains how to maintain it. What do you see as some of the challenges? ABRAMS: Whenever you're a market leader there is always competition nipping at your backside, so we can't let ourselves underestimate the competition. We need to develop additional markets, both geographic and vertical. We need to take a more aggressive licensing strategy, and as we roll out the Palm VII and Internet services, move into a more robust business model. PC WEEK: About this more aggressive OEM licensing plan, who are you looking at? ABRAMS: Let's see. Right now there's Symbol Technologies Inc., Qualcomm Inc., Handspring Inc., Sun Microsystems Inc. is licensing our HotSync technology, IBM, Franklin Covey Co., and Motorola Inc. We've got a list of prospects roaming the halls right now, and you can expect to see this list of licensees growing as many as two to three times as long. As to when, it's hard to say, but it would be a real stretch to see these new units on the shelves by the end of this year. PC WEEK: Are these OEMs looking to experiment with fundamental design differences? Maybe larger screens, for example? ABRAMS: You will see dramatic variations in product designs coming from the licensees, but not us. Palm Computing-branded devices will remain constant. Our main focus is to push the Palm platform as a whole. PC WEEK: Aren't you concerned about companies using the Palm OS, like Handspring, taking market share? ABRAMS: What we're playing right now is a market share game. I've sat down with Handspring and it's a symbiotic relationship. I'm driven to do everything I can to make Handspring, and the Palm OS as a whole, a success. PC WEEK: A few weeks ago, Jeff Hawkins of Handspring commented that future sales for handhelds will be driven by individual purchases rather than corporate sales. What's your take on that? ABRAMS: At some point in time you're going to see a dramatic increase in corporate sales. But for the next three years, I think consumer sales will still outpace enterprise sales in the United States. PC WEEK: What will drive the handheld into the corporate workspace? ABRAMS: Clever, risk-taking CIOs. I think the focus on individual productivity and working hand-in-hand with companies like Oracle Corp. and SAP AG will start to make a difference. However, I think the "killer app" is going to lie in the CIOs and CFOs from the corporate standpoint. PC WEEK: But wireless connectivity is going to be a part of that direction moving forward, right? ABRAMS: Well, I also think the next breakthroughs in adoption will take place in worldwide wireless as with the GSM (Global System for Mobile communication) and wireless adoption in Europe. Third-party applications and even the Palm VII can build e-commerce transactions. When people start to see they can now take advantage of affordable technology, that is when the breakthroughs are going to come. PC WEEK: Since you brought up the topic of the Palm VII, how are things progressing now? ABRAMS: We have completed beta testing and are in the third week of our field test. The product is working fine with our 600 testers across the United States. Now we are just making certain that we are delivering a good end-user experience. I want to make sure that we have at least six weeks of field testing under our belts. If we are on target for a summer release, we could have units available in the May -June time frame. PC WEEK: When Palm first unveiled the Palm VII last December you took a couple of knocks for the initial pricing and service costs: $800 for the unit and $10 a month for 50KB of data. Has there been a change of tune since then? ABRAMS: My philosophy is not to advertise pricing before a unit is ready for market. But it will not be $800. What I can tell you is it will be way below that point. PC WEEK: There was talk of a color unit last fall. ABRAMS: Have we been looking at creating a color unit? You bet. But there is a Zen of Palm. When I say that, I mean will it have an acceptable battery life? Will it meet an acceptable price point? Is there a simple user interface? Is it reliable? Will we get good performance out of it? Until we can address these elements, the unit will not leave the labs.