BUSINESSWEEK ONLINE : AUGUST 28, 2000 ISSUE
TECHNOLOGY & YOU A Losing Hand for This Palm? The Palm has potential as a mass-market product, but its rivals may steal the show Since the Palm hit the market in 1996, some 9 million of the handy devices have been sold. But the accomplishment looks far less impressive next to this statistic: Last year alone, worldwide sales of wireless phone handsets were nearly 300 million units. So although the Palm has gone from techie plaything to the corporate mainstream, the company wants to make Palm consumer products as ubiquitous as cell phones. Palm (PALM) has introduced its first product designed from the ground up for nonbusiness use. The new m100 shows both the promise and the peril in store. Functionally, the m100 is much the same as the existing Palm--the main innovation being a window in the cover that shows the time and date when a button is pushed. But the m100 is designed specifically to appeal to people who have not been big Palm buyers, particularly women and high schoolers. The package combines a bit of design flair with a size that is easier to hold with smaller hands. The m100 is a little smaller than the pricey, corporate Palm V in both length and width, with sides that curve inward for a better grip. But it's thicker, to allow the use of disposable AA batteries. Following the trend of personalization through ''skins,'' it offers a variety of interchangeable, $20 colored faceplates that can be snapped on and off. That's not so dramatically new. But the m100 is more marketing concept than product innovation, and in marketing, the sizzle can be more important than the steak. The goal of making the Palm a true consumer product is a good one. The need for a neat and handy calendar and phone list is hardly limited to executives and engineers, and there are plenty of people who might enjoy playing an occasional game while riding on a bus or waiting for an appointment. The question is whether the m100 is the right product for the job, and here I have some serious questions. NO CIGAR. The biggest problem is price. The m100 lists for $149, the same as the recently reduced price on the similar IIIe. Both units have a monochrome display, but the m100's is smaller by about a quarter-inch in each direction. In addition, instead of a sync cradle to exchange information with your computer, the m100 comes with a cable. The process works much the same, but the cable is cheaper--and looks it. Palm is discontinuing the IIIe, meaning prices may fall as retailers clear stock, leaving the m100 in the uncomfortable position of offering less for more. Some of the design choices Palm has made are also troublesome. The sync cable supplied with the m100 works only with a standard serial port, not the newer USB connection. USB sync is faster, easier to set up, and works with any computer running Windows 98. More important, USB is the only connection on Apple iMacs and iBooks, many of which are used by prime m100 target customers. Mac owners, who will have to shell out another $39.95 for a USB adapter, may find the Palm-based Handspring Visor a better buy at $179. In addition, no existing Palm accessories, such as modems, will work with the m100 because it uses a different connector. The Palm has rich potential as a mass-market product, but in the end, the most appealing offerings may come from the growing number of companies that have licensed Palm's software. Sony, a company that certainly understands mass markets, is showing prototypes of a sleek, Palm-based handheld that it will have in stores this fall, at an as yet undisclosed price. Palm also has worthy competitors that don't use Palm software. Microsoft's (MSFT) steadily improving PocketPC is the strongest example. Although Palms are fast at basic calendar and address-book chores, they need more horsepower for images and sound, and a faster processor is in the works. Higher-resolution displays, both monochrome and color, are also coming. Palm's dominant share of the handheld market is not threatened yet, but the company--and its partners--need products more imaginative than the m100. For a collection of past columns and online-only reviews of technology products, go to www.businessweek.com/technology/ BY STEPHEN H. WILDSTROM Questions? Comments? E-mail tech&you@businessweek.com or fax (202) 383-2125 Want to express your own views on a tech&you column or other technology topic? Join the Technology & You online forum. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS A Losing Hand for This Palm? TABLE: The Palm m100 PHOTO: The New Palm INTERACT E-Mail to Business Week Online

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