PalmOne boosts handheld memory and cuts prices

With the Tungsten T5 and the Treo 650, PalmOne will attempt to increase its grip on the declining handheld market
Written by Richard Shim, Contributor and  Matt Loney, Contributor
PalmOne introduced a handheld computer on Monday that keeps a grip on data even when the battery runs down, as part of a revamp of its mobile-device line-up which will include widespread price cuts.

The Tungsten T5 will include non-volatile memory to make sure the data is not lost. The feature adds flexibility to the £329.99 gadget -- the latest in PalmOne's line of business handhelds -- and increases its reliability as a storage device.

Click here for ZDNet UK's preview of the Tungsten T5.

On 25 October, PalmOne will continue its highly anticipated product realignment with the introduction of the Treo 650, an update to its smartphone family that will have a high-resolution screen and a higher-end processor, according to sources. PalmOne representatives have declined to comment on this.

The new Tungsten T5, which was modelled on the popular, entry-level Tungsten E business device, uses a high-end Intel XScale processor and comes with 256MB of memory and a Secure Digital expansion slot. Of the 256MB, 215MB will be available to the end user, of which 55MB can be used for programs and 160MB for storing data. The Tungsten T5 will not run programs from the 160MB portion, said Palm.

A version of the device demonstrated in London on Monday runs PalmOS 5.4.5, and Palm said it would enable the user to view native PowerPoint presentations; current Tungstens can open Word and Excel applications.

The device "also doubles as a flash drive, allowing people to carry their work from the office to home and back, without carrying a laptop", Ken Wirt, senior vice-president of worldwide marketing for PalmOne, said in a statement.

Although the Tungsten T5 comes with Bluetooth built-in, those who want Wi-Fi will have to buy an 802.11b adapter. "Our response to the Wi-Fi question is the price point," said Colin Holloway, marketing director northern Europe. "In our experience, Wi-Fi products do tend to hit a higher price point."

The Tungsten T5 is due to begin shipping in the UK within two weeks, said Tim Mahne, sales director northern Europe. Retailers should be accepting orders from now.

The company also announced price cuts for next Monday across its existing line of devices, and launched its first integrated GPS solutions: the £249.99 Zire 31 GPS and the £349.99 Zire 72 GPS. Both come with Michelin mapping software and car-mounting kits, and the Zire 72 GPS supports Bluetooth. All prices are including VAT.

The Zire 71 will drop to £79.99, the Zire 31 will be £119.99, and the Zire 72 without GPS will cost "£169 or £179", while the Tungsten E will cost £149.99.

To help reinvigorate sales of the Tungsten T3, PalmOne will drop the street price from £299 to £249. At the beginning of November it will also bundle a wireless keyboard in a package to be called 'Business Class'.

The Treo 650, set for release later this month, will become PalmOne's top-of-the-range smartphone. It will have a case similar to that of its Treo 600 predecessor, but with slightly more rounded edges, and a new keyboard with flatter keys, sources said. It will feature a high-resolution screen of 320 pixels by 320 pixels and a built-in 1.3-megapixel digital camera. Inside, it will have a high-end Intel XScale processor, a removable battery and Bluetooth wireless connectivity.

The new smartphone will use PalmSource's Garnet operating system. PalmOne has said one factor in its decision to use Garnet is its compatibility with the Mac operating system and the community of consumers using it. PalmSource is not expected to create a Mac version of its Palm Desktop for Cobalt -- so far, it has developed a Windows version only.

The present top-model Treo 600 will continue to ship but will carry a lower price, PalmOne has said, as part of its effort to create a family of phone devices.

With the release of the Tungsten T5 and the Treo 650, PalmOne is looking to increase its market leadership over Hewlett-Packard and others in the gradually shrinking handheld market. It has also set the pace for the emerging smartphone industry by successfully combining phone and organiser capabilities, something rivals such as Nokia have yet to match.

While PalmOne has been making strides in both markets, expectations are high. A good example came earlier this month, when PalmOne posted a profit, exhibited strong revenue growth and beat analysts' expectations -- but still saw its stock fall because its guidance for the next quarter didn't match Wall Street estimates.

Despite this, PalmOne has been pumping out devices. It shipped about 981,000 handhelds and phones in its latest quarter, which ended on 27 August. That breaks down to 273,000 Treo 600 phones and 708,000 handhelds. The company has shipped about 661,000 Treo 600 units in total.

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