marketplace CE

Over a year ago Microsoft and a number of manufacturers introduced the Palm-size PC, in part to capitalize on and challenge the success of Palm Computing's PalmPilot. The Pilot has dominated the handheld category for a couple of years, with over 2 million users. Palm Computing's philosophy is to do a few fundamental things well, and not try to be all things to all people. So far, they seem to have done their homework well, identifying the features necessary to make their device successful.

Even so, 3Com will be challenged to maintain its leadership position against Windows CE Palm-size PCs. The number one PC vendor, Compaq, as well as HP, Casio, Philips, Everex and five other manufacturers have introduced Windows CE Palm-size PCs. That means many of the world's greatest companies are trying to out-innovate each other, and Palm Computing, to create a superior palm-size machine. 3Com (Palm Computing's parent company) is now talking about licensing the Palm operating system, but I think it is already too late. The competitive marketplace continues to produce better Palm-size PCs, and eventually manufacturers and Microsoft will "get it right" for many different segments of the marketplace. This will leave PalmPilot as a niche device.

Ironically, if Palm-size PCs succeed, Microsoft and its partners will owe much of their success to Palm Computing's pioneering efforts. In the end, Microsoft and its OEM partners may turn what began as the strength of PalmPilot machines (few features done well) into a weakness in the eyes of consumers. Feature-rich Windows CE devices will provide more solutions to more people. Even now, universally appealing Windows CE features such as color displays and voice recording have put the PalmPilot into a catch-up position. And the race will get faster and more competitive.

A PC on every desk and a PC Companion in every pocket

Microsoft has been successful in getting manufacturers to develop handheld and palm-size PCs because it is successful in sharing its vision of "data at your fingertips" and because hardware manufacturers recognize the tremendous growth potential of handheld devices. We existing "handheld visionaries" already enjoy having our e-mail and other data always available, and appreciate having a simple input device always on hand. As phone, scanning, voice and handwriting recognition, wireless and other technologies evolve and merge, more and more capabilities will be available to us, and to an ever-growing number of PC Companion users.

The challenge for Microsoft and the hardware manufacturers is to find the right formula and quickly make these devices a no-brainer purchase for mainstream consumers.

Handheld PC Magazine subscriber Steven Berkwits has some thoughts on the right formula. He e-mailed some interesting comments based on my last column.

"I was making a phone call from a hotel lobby and an insurance agent, there for some productivity seminar, was so fascinated by the way I was using my HP 620LX, I had to give him a brief demonstration on the spot before he would let me make another phone call. I showed him how I use the main application and Pocket On-Schedule. He excitedly told me I had showed him more about improving his productivity in five minutes than the seminar leader had in two hours!"