Palm Admits Smartphones are the Future
By Eric Lin, Thu Jan 22 19:00:00 GMT 2004

PalmOne, the hardware unit of the now split company, have announced they will shift their emphasis from PDAs to smartphones. Although it may not necessarily be related, they also announced they will layoff 12% of their workforce.

Using sales figures from the past year to predict trends, the analysts have said that at best, PDA sales will remain flat. It is more likely that as smartphones become more prevalent, PDA sales will sink. PalmOne got wise and bought (back) Handspring last year to take advantage of the hard work they had done creating the Treo line of smartphones. Now they have extended the trend within their company to concentrate on smartphones instead of the PDAs they made their name in and are still known for.

Mobile Pipeline points out that PalmOne could be repeating the exact same mistake that Handspring made before they launched the Treo. They announced they would drop PDAs for smartphones and sales plummeted. Worse yet, the first generation Treos did not sell well and landed Handspring in trouble. At least PalmOne will start their smartphone venture with a proven design- the Treo 600.

It is interesting that the hardware company, PalmOne, has seized onto the smartphone trend before the software side, PalmSource. The other major OS providers have acknowledged the shift towards connected devices and have shifted their strategies. Symbian now only provide connected OS versions and Microsoft have developed connected editions of their OS. PalmSource continue to let their licensees add phone functionality on their own if they wish to incorporate it.

If PalmSource would have announced a smartphone version of the OS it would have signaled that the last holdout in the mobile OS world had finally joined the smartphone revolution. However PalmOne is also traditionally slow to adopt new technologies and strategies. For them to shift their focus to smartphones still signals a big shake-up in the Palm OS world.