Recent developments in Palm's hardware and software divisions indicate that the PDA manufacturer is keen to re-establish Palm OS as a credible competitor to Microsoft's Pocket PC platform.
Although most of these announcements will not take effect until next year at the earliest, they should establish a stronger future for the firm.
Palm still has a significant lead over Windows CE-based devices in PDA market share, but it currently lags behind Microsoft in areas such as support for multimedia and communication technologies.Last month's announcement that Palm is to acquire the intellectual property and technology assets of Be, developer of the multimedia operating system BeOs, could help to change that.Be's main strengths are the powerful audio and video capabilities of its platform, which could provide a much-needed boost to the capability of Palm devices in this area.
Palm's long-awaited phase-in of support for the powerful ARM processor will also help to expand Palm-based handheld capabilities in the future. The Motorola DragonBall Super VZ chips currently used in Palms offer a fraction of the power that will be delivered by an ARM-driven device. Intel, Texas Instruments and Motorola are all making reference platforms using Palm's developer kit, as part of a collaborative project involving ARM. Intel will develop both StrongArm and XScale solutions for the Palm, and Motorola's proposed DragonBall MX1 is also based on an ARM core and due for release next year. The new processors will be capable of speeds of over 200MHz, compared with the current DragonBall's modest top speed of 33MHz.
Another significant development within Palm has been the decision to split the organisation to form a wholly owned subsidiary, the Platform Solutions group, which will be responsible for developing and licensing the Palm OS operating system. At present, the company operates as a single unit, incorporating both hardware and software development. However, the new subsidiary is expected to be in place by the end of this year and will operate separately from Palm's hardware business.
Although there are no current plans for Palm to cease developing hardware itself, the new structure would make this feasible in the future, should the manufacturer decide to relinquish that side of its business. Palm UK channel manager Martin Worth commented, 'Palm has no plans to move out of the hardware business at present. We have huge brand equity worldwide and it would be madness not to make the best of that.' However, he added that the formation of the Platform Solutions group is intended to make that possible. About 95 percent of Palm's revenue comes from device sales at present, rather than licensing of the operating system, so any move of this type would also require considerable repositioning on the part of Palm.
If the company did decide to stop manufacturing hardware, this would alleviate its current anomalous position of licensing its operating system to third parties, while also competing against those organisations with its own devices. Handspring and Sony are two of the largest third-party users of Palm OS, although Palm itself had 53 percent of the US PDA market in 2000, making it the market leader.
The last couple of months have been some of the most eventful in Palm's history.The period heralds some important, and necessary, changes both to the technology underlying its PDAs and the way in which the company operates. The decision to create a separate subsidiary dealing solely with the operating system will give Palm the flexibility to reposition itself as a software specialist in the future, should it choose to move in this direction.
