Palm, Motorola to make PDA cell phones
By Pui-Wing Tam, WSJ Interactive Edition
September 25, 2000 4:52 AM PT
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Palm Inc. and Motorola Inc., in a move toward the convergence of cell phones and handheld computers, have agreed to co-develop and co-brand a new line of smart mobile phones.
Under an agreement to be formally announced Monday, the two companies plan to develop a phone by early 2002 that combines Palm's operating system with Motorola's wireless technology. The new device will feature a color-display screen that is larger than most cell-phone displays, and include Palm's address book and calendar features, as well as the ability to surf the Web. It will also be able to connect wirelessly or through a cradle to a computer to synchronize information, the companies said.
Palm, of Santa Clara, Calif., and Motorola, of Schaumburg, Ill., are designing the phone to fit a widely used digital cellular standard known as GSM, for global systems. But it will also work with other wireless systems in use around the world, the companies said.
The agreement is the latest step by a U.S. handheld-device maker to merge the handheld computer with the wireless phone. Last week, handheld-device maker Handspring Inc., of Mountain View, Calif., unveiled a mobile-phone attachment that transforms the Handspring Visor handheld into a cell phone and messaging device. Known as the VisorPhone, the GSM module will sell for $299 and begin shipping to customers by the end of the year.
Calling all PalmsOn Friday, Palm also announced that one of its hardware developers, RealVision, a Hong Kong company, has created a snap-on attachment -- complete with an earphone jack -- that allows users to make phone calls, as well as access the wireless Web. The GSM attachment works primarily with the Palm V series of devices. The product will be available in Asia and Europe in early 2001 for less than $299, but isn't expected to be immediately released in the United States.
Whether consumers will embrace these initiatives is a big question mark, however. Telecommunications firms such as Nokia Corp. and Qualcomm Inc. have in the past produced combined cell-phone and handheld-computing gadgets, but the clunky products flopped. Still, Palm's chief executive officer, Carl Yankowski, said: "Technologies have advanced tremendously since then, and now we have an opportunity to redefine the form factor and innovation of a new device."
Merle Gilmore, president of Motorola's Communications Enterprise, added that the new product is likely to be just the first in a family of co-developed devices with Palm. "We needed to have a co-development effort" with a wireless-data and wireless-voice firm for a combined product to really succeed, he said.
Analysts said the Palm and Motorola agreement, coupled with Handspring's recent announcement, indicates a new direction for the combined cell-phone and handheld-computing devices. "There's a real difference, since these new products may begin to look more like a handheld computer," said Christopher Fletcher, vice president of research house Aberdeen Group Inc. "The handheld-computing form factor may start to become the standard."
Fletcher added that Palm's operating system is also emerging as a winner, since both Handspring's VisorPhone and the new Motorola and Palm phones rely on the Palm platform. In contrast, handheld-device competitors such as Psion plc. appear to be behind in the race, he said.
Palm and Motorola are existing partners; in December 1999, Motorola took an equity stake in Palm. The new device is yet to be named, and both Messrs. Yankowski and Gilmore said it is too early to discuss pricing of the product. The co-branded devices will eventually be sold through Motorola's sales channels, which encompass worldwide retailers and e-tailers, among others.
Separately, anti-virus company McAfee, a unit of Network Associates, said it has identified a Palm virus that has the ability to infect and destroy application files. The virus, dubbed Phage, can spread through infrared transmission to other Palm devices, or can be passed on if it is downloaded onto a Palm device through a computer, said Vincent Gullotta, head of McAfee's anti-virus emergency-rescue team. But Gullotta said the virus, which was discovered on Thursday night, so far appears to be relatively contained.
