Moody investors take Psion to task

The handheld computer maker was slammed by the markets Monday, even though its wireless plans are on track

Motorola's decision to drop out of a wireless handheld joint venture with Psion (quote: PON) was exaggerated by a market looking for bad news, says an industry expert.

The news that Motorola had dropped its joint development project with Psion emerged in the midst of a wave of gloom across the telecoms industry, driven by fears of an economic slowdown and the possibility of handset saturation in Europe. Psion shares closed down 19 percent Monday, at 213p, but recovered somewhat Tuesday, hovering at around 220p by late afternoon.

Psion has suffered lately from doubts about the future wireless computing, with its EPOC operating system destined for use in Symbian smartphones. But the Motorola announcement says more about Motorola and its woes than about wireless computing, according to analyst Catherine Pennington of IDC. "This is one device out of a whole initiative towards 2.5G and 3G," she says. "To take one aspect of this and turn it into a trend would be a bit of an over-exaggeration."

Motorola has dropped about 30 other development projects, but is maintaining its commitment to Symbian -- and the "Odin" device from Psion and Motorola would have been based on Symbian anyway, Pennington notes.

Psion says it has a number of other wireless computing projects in the works that are unaffected by the Motorola relationship. The group says its Revo Plus organiser, aimed at the mobile wireless user, is helping the Psion Computers group gain 20-25 percent of its revenues from mobile network operators. "Even without a connected product we have a good context," says a Psion spokesman.

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