That depends on where you live. The handheld wireless-data gizmos just now appearing in the United States, Europe and Japan are related but distinct species–which is only natural, since they’ve evolved in different environments. Each is heavily influenced by local mobile-communications standards, local competition and what local service providers think they can get people to pay for. As standards converge, and as service providers and equipment makers learn what people want, the competition will grow increasingly global. Right now, though, the handheld-device makers are fighting for share one market at a time.
The announcements are coming fast and furious. This week, for example, Palm Computing, the California-based subsidiary of 3Com, will unveil the latest in the line of personal digital assistants that dominate the U.S. market for such products. The Palm VII offers e-mail capabilities and select content from 22 top U.S. Web sites–among them, ESPN (sports) and ABC (news). “It’s a good first attempt to integrate wireless data services into a handheld device,” says Diana Hwang of IDC, a research company in Massachusetts.
In Japan, meanwhile, the manufacturers are making a virtue of their particular strengths. The most popular PDA in Japan is Sharp’s Zaurus. The latest, the EX1, can download Web material when connected to a regular or mobile phone; it can also double as digital camera. Take a picture and e-mail it to a friend. Casio’s new palm-size device, the Casseopeia E-507, has a Web browser, a color screen and a photo function.
But are hardware tricks really the ticket to long-term success? Psion, the British PDA manufacturer, would argue no. The leading maker of personal organizers in Europe, Psion is trying to position itself as the software kingpin for the handheld era. The company is tailoring its Epoc operating system to next-generation smart phones. To achieve its goal, Psion has formed a software consortium, named Symbian, with the world’s leading makers of mobile phones–Nokia, Motorola and Ericsson. If smart phones turn out to be the vehicle of choice for mobile data services, Psion could become a mini-Microsoft.
That’s a big if. Psion’s hardware sales in Europe have been faltering, and the company has little presence in the United States, where Palm rules. Palm claims it is gaining market share from Psion in Europe–and the company is making inroads in Japan, too. Palm has licensed its operating system, Palm OS, to IBM, the No. 2 player in the Japanese market (behind Sharp). What’s more, Qualcomm, a U.S. company that controls key patents for the third-generation wireless standards now being finalized, is aligned with Palm. Qualcomm is coming out with a smart phone called pdQ, based on the Palm platform.
Psion may also come under attack from Microsoft, which is beginning to wedge its Windows CE operating system into the sub-PC market. Casio, Hewlett-Packard and Philips are among the manufacturers licensing CE for palm-size devices. But many analysts say the system is not ideally suited for the new class of gadgets, especially smart phones. “Microsoft has taken Windows and tried to scale it down [for handheld products],” says Joe Gordon of the Cambridge, England-based consultancy Analysys. “That is a difficult task. Windows is slow and clunky because it was designed for bigger devices.”
Then there’s the Internet problem. Receiving Web data on handhelds isn’t easy. Web pages designed for PC display can overwhelm small, battery-powered devices. To reduce the “bulk” of such files, Palm has replaced the Internet’s “hyperlink” system with a simpler “query and response” application. When the user requests an Internet file, the query is stored on the local network, not online. The Web pages that are returned are compressed “clippings” from the actual site. Both innovations conserve bandwidth and time spent on the network.
Manufacturers have established a so-called wireless-application protocol, or WAP, which will allow content providers to create slimmed-down versions of their Web pages. Nokia, the Finnish juggernaut, will soon come out with the first WAP-enabled product, the 7110 smart phone, which will hit store shelves in Europe this summer. Described as a “media phone,” the 7110 offers rapid Internet access, e-mail and fax capabilities. It’s got enough memory to store 1,000 business contacts–with five numbers for each. Of course, with a price tag of at least $500, it will appeal mainly to people who have 1,000 business contacts. Intended as much for the eye as the ear, the Nokia 7110 is a clear harbinger of the long-awaited “convergence” of computing and telephony. And in a market that measures product cycles in months, it will not be long before competition combined with technical refinement brings prices down. But can you wait?
