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A new breed of PDAs is coming. But would you want one?

The industry's future is riding on it...
Written by Tony Hallett, Contributor

The industry's future is riding on it...

Last year European enterprises alone spent $460m on mobile business solutions, according to research out today from Datamonitor. However, if that sum is to grow and consumer use of mobile data is to take off, it seems handheld makers must start offering more extensive packages which are as much about software as hardware. The market for PDAs remains sluggish but the usual suspect device and software makers have this week been putting on a brave face. Despite huge advances since the early days of the Apple Newton and PalmPilot, handheld PDAs have only ever sold, in total, a small fraction of the units mobile phone businesses currently ship in a year. Announcements at the 3GSM show in Cannes this week have focused on device design, application availability and - crucially - integration with enterprise IT infrastructure. Microsoft started the week boldly, announcing that T-Mobile will this summer start to offer Pocket MSN on its mda device, a PocketPC-based wireless handheld that strongly resembles mmO2's xda. Speaking at a Microsoft press conference, T-Mobile International chief marketing officer Nikesh Arora even went as far as to call 2003 "a turning point in seeing if this mobile data world is going to succeed". One company with a particularly close relationship to Microsoft is Dell. Since last November in the US, and earlier this month in Europe, it has started to ship its PocketPC-based handheld, called the Axim. Initial unofficial sales levels, disclosed to silicon.com in a briefing with Michael Dell last month, suggest Dell will take as much as a 10 per cent unit chunk of the PDA market. Against that backdrop, HP this week sought to re-establish its iPaq as a high-end, Bluetooth- and 802.11 WLAN-enabled device. It's also targetting the consumer end of things with its sleek new h1910 model. These releases follow a dismal year for HP sales, especially relative to Palm and Sony. Nevertheless, the company bullishly says it was the only manufacturer in the PocketPC camp to grow market share in Europe last quarter. The PocketPC-based h1910 runs on a 200MHz Intel PXA 250 processor, offers 16MB of NAND Flash and 64MB of SDRAM memory and has all the usual expansion options. However, its design is its biggest plus. It is slightly more streamlined than Dell's Axim X5 offering, though the Axim is available with a faster processor and is still cheaper - shipping at £250 as opposed to £299. The h1910 perhaps most closely resembles the Palm Tungsten models, released in the last quarter of 2002, and in particular the Tungsten T, with its innovative design and multimedia capability, which is built on a fast ARM processor and runs Palm OS 5.0. They're also similarly priced. The Tungsten W, with built-in QWERTY keyboard, is to be used by Vodafone in the UK and, as announced this week, by AT&T Wireless in the US. However a Symbian presentation in Cannes highlighted that the Palm OS is nowhere to be seen in the factories of the biggest makers of mobile phones (excluding Samsung). Despite this, the PDA pioneer has been stressing the wide range of devices based on the Palm OS. It has also been speaking, as ever, about developer numbers and applications. PalmSource director of marketing EMEA Jean-Marc Holder said: "We have 16,000 commercially deployable applications. Symbian has 500 and Microsoft has a third of ours, with only hundreds for [its Windows] Smartphone OS." Last year PalmSource CEO David Nagel told silicon.com that his company does not fear Dell. This week Holder added: "Dell will wreak havoc - but in the PocketPC world. They'll go in cheap and dance rings around the two-tier providers." PalmSource and manufacturers that use its software also talk about enterprise manageability, an area where Microsoft has made inroads, with many users assuming connecting to back office software such as Exchange is easier from Windows OS's. PalmSource disputes such assertions, even claiming Word documents manipulated on a Palm PDA look better when synced back onto a PC than when they have been edited on a PocketPC device. And in the push to sell a solution rather than PDAs, HP doesn't want to be overshadowed by its software partners. "These are only access devices," said Bernard Falise, handheld manager at HP EMEA personal systems group. HP has been touting its Extended Instant Mobility Suite (IMS), a bundle which it has sold to TIM in Italy, and which it claims will drive the mobile operator's ARPU (average revenue per user) rates. Given past disappointments with sales volumes and delays and difficulties with high-speed wireless connectivity, all the main hardware and software companies in the PDA space are reluctant to be overly optimistic right now.
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