Handhelds target the next level

In an eerie continuation of a Dickens parody, last year was another 'best of times, worst of times' for handheld computing. Better times may or may not be in store this year, but better products almost certainly are.Worldwide shipments totaled 12.1 million units last year, a 9.1 percent decline from 2001, according to preliminary results from Gartner Dataquest of San Jose, Calif.'We estimate that about 70 percent of all PDAs are purchased by consumers and only 30 percent by enterprises,' Todd Kort, principal analyst for Gartner Dataquest's Computing Platforms Worldwide group, said in a statement. 'The more lucrative enterprise market has been stagnant because of poor economic conditions and a perception that PDAs are not yet capable of delivering sufficient return on investment. The enterprise market is still another year away from embracing PDAs.'Among the factors holding back the growth of personal digital assistants in enterprises are a shortage of wireless networks and persistent concerns over security'but both factors are evolving.According to researchers, Palm Inc.'s worldwide PDA shipments declined 12.2 percent last year, but it still shipped more than twice as many units as its nearest competitor, Hewlett-Packard Co., which registered a 27 percent worldwide sales drop last year. Toshiba America Information Systems Inc., which began shipping PDAs in late 2001 in Japan, grew rapidly to become the No. 5 vendor worldwide last year.Once-mighty Handspring Inc., which appears to be shifting from a maker of handheld organizers to a manufacturer of smart telephones and communicators, saw a steep 49.1 percent drop in its sales globally, shipping fewer than 700,000 units last year.If, as Kort predicted, it'll be a year before the enterprise embraces PDAs, perhaps a confluence of factors this year will help move it along. Among them will be new products, lower prices and, perhaps most important, easier ways to wirelessly network the devices.Palm, which has had a bruising few years, appears to be hitting its stride again with a bevy of new products aimed at both consumers and enterprise users. Late last month it introduced a wireless, IEEE 802.11b-capable handheld, the Tungsten W, with a high-quality transflective color display that should read well in sunlight as well as indoors.It's also the largest-memory Palm ever, with 64M of storage and an upgradeable ROM. It still has a Secure Digital Card expansion slot for even more storage. With a 400-MHz processor and bundled virtual private network software, the $499 device is aimed at enterprise users.That same day, Palm unveiled the Zire 71, a consumer-oriented device that has a built-in camera. Slide the back cover down and a lens appears as the unit automatically switches to picture-taking mode. Picture size is 640 by 480 pixels, big enough for the Web and e-mail. If you pair the phone with a compatible wireless phone to e-mail pictures back to the office, you've made the device a workplace tool.These innovations arrive amid something of a dry spell for Microsoft Corp.'s Pocket PC platform. Introduced with much fanfare in 2000, then beefed up in October 2001 with the Pocket PC 2002 edition, devices running this improved version of Microsoft's earlier Windows CE handheld operating system have a big following.HP's iPaq attracted legions of fans and dozens of accessories, and the arrival of Dell Computer Corp.'s Axim brought Pocket PC power within the price range of many Palm devices. Before the Axim, Palm and Handspring had a solid lead in the price race against the more expensive, though higher-powered, iPaqs.Yet even though Dell was new to the handheld race, HP's successful acquisition of Compaq Computer Corp. meant the end of the line, last year, for the popular HP Jornada. Toshiba's thin and stylish Pocket PCs may have taken up some of the slack, as has ViewSonic Corp.'s relatively new Pocket PC device.Anyone looking to Microsoft for major product news in Pocket PCs will have to wait until at least 2004, according to industry sources who asked not to be named. There may be some tweaks to the Pocket PC OS this year, but a major overhaul of the platform is 12 months away.Paul Osborne, a senior Palm product manager, said the Navy is interested in devices such as the new Tungsten C for access to medical records. The audio and optional bar code scanning features of some Palm devices also are of interest, again united with 802.11b, or WiFi, wireless capabilities. Osborne added that built-in Bluetooth, found on the Tungsten W, and WiFi are strong interests for enterprise users.Meanwhile, prices are tumbling. Sharp Electronics Corp.'s Zaurus and Casio Computer Co.'s handheld Pocket PC devices both cost less than they did a year ago. HP introduced a less expensive iPaq, and Dell bowed to consumers with its $299 Axim.Along with lower prices, it's worth noting that just about every handheld surveyed for this article is far more powerful than its predecessor, and many have expansion capabilities. Modules for the Secure Digital Card slot are coming along a bit more slowly than those for the CompactFlash slots favored by Pocket PCs. But expansion is coming to both platforms nonetheless.At the same time, an increase in built-in WiFi and Bluetooth augurs well for users who are mobile in a campus environment or who travel across the country. But some analysts, such as Kort, remain a bit skeptical about wireless growth.'Wireless infrastructure is still immature, and wireless data security issues have not been fully resolved,' Kort said in the Gartner Dataquest statement. 'End users still have too many hassles getting wireless devices properly configured. On top of this, wireless data speeds are typically much less than advertised, and costs per megabyte are relatively high, especially in the United States.'To address those issues Microsoft offered wireless security software this year. And Palm included a virtual private network client in the Tungsten W. As more wireless networks turn up, look for users to demand more support from their IT departments . Light, pocket-sized handhelds could supplant notebook PCs as the 'hall warrior's' tool of choice.