3Com Looks to Net Success for Palm VII Introduction

Computergram International, May 24, 1999

By Dan Jones

3Com Corp hopes to maintain its dominance of the handheld market with the introduction of its Palm VII today. 3Com's Palm computing division has enjoyed runaway success with an estimated 80% share of the worldwide handheld market. However, this position is now being threatened by stronger competition from handhelds based on Windows CE, products using the EPOC32 operating system backed by the Symbian consortium, and other wireless devices of all shapes and sizes.

The Palm VII will be the first Palm device to offer direct connection to the internet. It uses a tiny radio transmitter, receiver, and antenna to connect to the internet, with Palm itself offering ISP services via its subscription-based Palm.net service. The underlying wireless network will be provided by BellSouth Wireless Data, which Palm claims covers 93% of the urban population in the US.

Palm claims it has solved the slow download constraints of other handheld devices with its new 'web clipping' service. Companies such as UPS, Visa and Yahoo have prepared cut-down summaries of web content such as stock quotes and travel information. The Palm user requests information in a questionnaire style format, and receives a text-only response. The VII is expected to go sale at $599 with a $9-a-month charge for the internet services. However, the device won't be launched across the US, as Palm is still testing its net services.

The new Palm looks likely to be successful in the consumer market, especially if prices are cut after it has been on the streets for a while. However, heavy web users could find that the VII comes with a sting in the tail, the monthly web access subscription fee only allows for a 50K daily usage, and fees are tacked on for any additional usage. Merrill Lynch expects the machine will be less of a hit in the corporate arena because it does not have end-to-end security. Companies would have to 'open' the corporate firewalls to allow wireless access to corporate data.