The PDA Wars--Part I

While competition is mounting, especially from upstart Handspring, Palm is still the recognized leader in handheld computing products, controlling roughly 60 percent of the handheld market. All has not been rosy for Palm, however, as it reported disappointing third quarter fiscal numbers in March and a grim outlook for the fourth quarter, as well as plans to reduce its workforce by 10 to 15 percent.

Also, Handspring has been pulling some Palm faithfuls to its side of the fence with some affordable, expandable devices. But Palm's new m500 and m505 handhelds promise to get Palm up to speed as far as expansion capability. The new models were announced in March, and at the time of this writing were scheduled to hit shelves in April (for the m500) and mid-May (for the m505).

The m500 and m505 models have what Palm calls dual expansion capability. A universal connector, located on the bottom of the device, handles hardware add-on modules, while a single slot on the top accommodates secure digital (SD) and MultiMediaCards (MMC). The SD and MMC slot will allow users to easily add storage, as well as specific content. Planned hardware expansion devices that will work with the universal connector include a Kodak snap-on camera, a Palm modem, additional wireless modems, MP3 players and a GPS receiver, with undoubtedly more to come in the future. Also, Palm has already announced some cards it will produce for the SD/MMC slot.

The m500 series PDAs are modeled after the sleek Palm V form factor. The m500 and m505 weigh 4 ounces and 4.9 ounces respectively, come with 8MB memory and incorporate rechargeable batteries. The m500 has a monochrome screen and is priced at $399, while the color m505 costs $449. In addition to the add-on capability, the m500 PDAs feature the new Palm 4.0 OS, a USB HotSync cradle for faster synchronization with a PC and, perhaps most important for mobile workers, mobile connectivity software to work with a modem or data-enabled mobile phone for access to the Web, SMS or e-mail on-the-go.

Handspring ended February with 28 percent of the U.S. retail handheld sales, up 2 percent from the previous month, compared to Palm's 59 percent share in February.
As far as products, the company has been successful in wooing the Palm faithful, in large part because of its much-vaunted Springboard expansion slot. Developers wasted no time in introducing add-on modules by the score in 2000, creating the impression that Visor owners were perhaps a step ahead of their Palm counterparts.

Handspring's PDA lineup had covered nearly all the bases, featuring the color Visor Prism as well as a budget Visor. However, the one Palm model that Handspring hadn't had an answer for was Palm's most popular line, the Palm V, with its thin profile and metallic case. Handspring's answer came in March with the Handspring Edge, a metal-encased, 0.44-inch thick, 4.8-ounce device. The Edge still has the Springboard expansion slot capability, but it didn't fit into the form factor.

"In order to keep Visor Edge thin, we had to make Springboard detachable," says Michelle White, senior product marketing manager for Handspring. "When you remove the slipcover, you expose the Edge Connector, and that Edge Connector is an area where the detachable Springboard slot slides into."

Although the Visor Edge, which debuted priced at $399, has a cool look and some serious "wow factor," there are some small drawbacks. For one thing, once you detach the Edge's cover to expose its Springboard connector, you're left with a metal cover to stow somewhere. Also, the stylus placement clipped to the side of the PDA is not the greatest design.

On the plus side, the Edge has a new capability called fast lookup that allows a user to find a contact using only one hand (in case the other is holding a cell phone). It also has a silent LED alarm. The Handspring Edge incorporates a rechargeable battery (with 90-minute complete recharge time), a USB cradle, a monochrome screen and 8MB of RAM. It sports the 33MHz Motorola Dragonball VZ processor and runs on Palm OS 3.5.2H. It's available in three colors: metallic blue, metallic silver and metallic red.

Handspring, since it introduced the Visor in the fall of 1999, has focused on the consumer market, selling product on its Web site first and expanding to retail stores only about a year ago. But a recent agreement with Ingram Micro is aimed at getting the Visor onto corporate purchasing lists. Only time will tell if it will be successful, but it's at least a step in the right direction, as the corporate market is the next key growth area for all handheld makers. Indeed, Palm recognizes this fact and has made its own corporate move with its recent acquisition of Extended Systems, a mobile data management company