Palm reinvents the PDA

Palm is taking a fresh look at the PDA, with a major design overhaul for new consumer and professional versions of its devices, which the company says will launch next month.

For the consumer market, Palm plans to launch a £70 device, which it aims to sell through new retail outlets such as supermarkets in a bid to expand its consumer user base, said chief executive Todd Bradley. Higher up the scale, Palm is also readying its first PDA based on ARM architecture, which will also be the first Palm device to have Bluetooth built in, and which has a totally new design, said Bradley. A third device will be Palm's first to include GPRS high-speed, always-on, telephone and Internet connectivity as standard.

The consumer model will be launched globally on 7 October, and the high-end models will launch three weeks later on 28 October.

Palm decided to split the launch in this way to emphasise the different directions that the company is taking with the different devices, said Bradley. "Clearly the launches are aimed at two entirely different markets."

The company decided to launch a low-end consumer model so that it could grow its user base. "Over the past 16 months we have dealt with many operational issues and have now positioned the company for growth, but the question we now face is: how do we grow?" Bradley said. "How do we bring a new set of customers into the handheld world? The general consumer wants something that will help them organise their life so the challenge was to redesign the product and make it more compelling for new customers."

Bradley declined to reveal more details about the product ahead of its launch, but rumours on the Web suggest that the device -- code-named Zire -- will have two hardware buttons instead of the usual four, will come with 2MB of RAM and will run Palm OS 4.1.

At £70, Zire will undercut Sony's entry-level PalmOS-based PDA, the SL10, which sells for £110 plus VAT.

Palm will be counting on Zire to buck a downwards trend in the PDA market. According to research firm Gartner, worldwide handheld shipments declined in the second quarter by 3.5 percent compared with the second quarter of 2001, dropping to 2.7 million units. Analysts have said some buyers are waiting on new units that will incorporate Palm's beefed up OS 5 -- released to developers in June -- but many executives at handheld companies still see growth potential in the market for low-end devices.

Those waiting for OS 5 will not have to wait long. It will be included in one of the two higher-end Palms, due to follow later in October. PalmOS 5 was developed for ARM-based processors, and adds support for bigger displays -- up to 320 by 320 pixels -- than previous versions, together with support for Bluetooth and wireless networking.

The PalmOS 5-based device will use Texas Instruments' OMAP ARM-based processor, potentially boosting speeds by a factor or two or three. It will be the first Palm to have Bluetooth built in, making it possible to connect to the Internet through a Bluetooth-enabled mobile phone. Bluetooth cards are available for the Secure Digital (SD) slots in current Palm devices, but building Bluetooth in should cut the overall cost of the solution, and free up the SD slot for other applications. "We're hoping this will be especially useful in Europe," said Bradley, "where people seem to like the idea of the two-piece combination -- a phone and PDA connected by Bluetooth."

"This is not an evolutionary product -- it is revolutionary," Bradley said. "Everything is new, including the form factor." Palm is understood to have hired designers from electronics giant Sony to work on the new Palm.

Palm's third new product will come with GPRS -- the high-speed, always-on General Packet Radio Service. "This will be very data-centric and is focused on the mobile professional," said Bradley. "It will be voice capable but it will not be pushed as a voice-centric product." This device will sell with a GPRS connection deal in a similar way to Handspring Treos, but since Palm has not finalised a deal with a carrier yet, pricing is not available.

This GPRS-enabled Palm will come with a suite of applications for accessing enterprise data: support will be included for connecting to Microsoft Exchange and Lotus Domino email servers through a virtual private network. Although many Palms find their way into enterprises through the back door -- they tend to be bought by individuals who then use them for work -- Bradley hopes the new devices, together with partnerships with companies such as IBM, will help Palm make more sales through the front door.

Both these Palms are aimed at an entirely different market from Zire. Palm's strategy: to give existing Palm users something that will make them want to upgrade. "A lot of people didn't see reason to upgrade to the Palm m500," said Bradley.

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