From TNPC issue #4.14...

Getting a Handle on Buying a Handheld

by Al Gordon
July 12, 2001

According to the time-honored wisdom, it is an ill wind that blows nobody good. So it is with the tech industry slump, which has led to sharp price reductions in most products, including personal digital assistants (PDAs). Combine that with a flurry of new products making their way to the market, and it is time for a new look at the world of handhelds.

Over the next few issues, I will be doing a series of pieces on new PDAs, peripherals, and software. Much of the focus will be on the Pocket PC world, primarily because there has been a major uptick in action there since I last looked at it a year ago. But things are also happening in the Palm OS universe.

BUT FIRST: TNPC publisher, Lee Hudspeth, has asked an excellent question, "How does one decide what handheld makes sense for whom in today's very confusing and cluttered marketplace?" Adds Lee, "I personally would not want to sink $200-$400 into a PDA and find it completely obsolete in a year."

Obsolescence is a chronic issue with things high-tech, of course. You can be assured that whenever you buy a new PC, for example, there will be something more powerful and cheaper on the market the moment you hand over your credit card number.

However, you also have the relative assurance that the PC, its software, and its peripherals probably are going to be comparable with both predecessor and successor units. That's not necessarily the case with PDAs. Depending on what you choose, you could be stuck with dead end technology.

A year ago, getting a Palm OS unit from Palm, Inc. was a no- brainer solution. But Palm's health is now in question. For its last fiscal year, Palm recorded a net loss of $356.5 million compared with a net income of $45.9 million for fiscal 2000. It faces growing competition from other manufacturers who have licensed the Palm OS, notably Handspring, Inc. and consumer giant Sony Corp.

While software generally can be used across the Palm OS lineup, hardware accessories usually are unique to a particular Palm OS PDA device. Plus, Palm itself has been notorious for allowing little peripheral interchange across its product lineup and, ironically, a recent move toward commonality so far has done little except make a great deal of existing hardware accessories obsolete.

And then--inevitably--there are the folks from Redmond. Pocket PC handhelds using Microsoft's Windows CE 3.0 operating system were rolled out early in 2000. Reliable data on market share for Pocket PC devices is hard to come by, but estimating from several published reports, it would appear that Pocket PCs represent 15- 20% of all PDAs and perhaps as much as 40% of new PDA sales.
http://www.TheNakedPC.com/t/414/tr.cgi?al1

Both are sharp increases over pre-2000 levels. More to the point, they are at that familiar cusp where Microsoft initiatives either flop (the multiple incarnations of MSN, for example) or pick up momentum and crush the opposition (as happened with Internet Explorer).

It's not quite that simple, though.

According to Ashley Walker of Handango (www.handango.com), a leading vendor of products for handhelds, "When Handango launched into the Pocket PC software realm, we had approximately 30 pieces of software and now we have over 800, that is a 2500% increase in a little over a year. The Pocket PC platform has demonstrated an average monthly growth rate of over 20% for Pocket PC software sales at Handango during Q1 2001." But... and this is a very big "but," those are not necessarily conquest sales. Walker sees "steady growth" in Palm software sales, also.

Market analysts agree that at least some of the Pocket PC growth is coming from the corporate market and represents new customers rather than a migration away from Palm.

So where does that leave you as a potential buyer?

Whatever you buy, you are certainly good to go for one to two years. In that time, the odds are substantially higher that you will drop the unit and break it before it becomes orphaned in the marketplace.

(That's not whimsy, by the way. The Achilles Heel of handhelds is the glass in their screens, which will break when dropped and will cost $100 to get repaired. It happens sooner or later, and makes a PDA one of the few consumer electronic devices for which an extended warranty actually makes sense.)

For now, buy a handheld the way you should buy any high-tech equipment: figure out what you want to do, what features you need to do it, and what your budget can handle, then buy accordingly.

If all you want is an electronic phonebook and calendar, a basic Palm OS device such as the Palm m100 or Handspring Visor will meet your needs for $150 or less.

Palm m100 Handheld:
http://www.TheNakedPC.com/t/414/tr.cgi?al2

Handspring Visor (Graphite):
http://www.TheNakedPC.com/t/414/tr.cgi?al3

If on the other hand you are looking for the closest approximation of a PC than you can hold in your hand and your wallet is fat, a Pocket PC is for you. But you will pay $500 or more.

Most of the action in PDAs, though, is in the $250-$400 range. That price buys you a choice of either platform. The rule of thumb here is easy: if you want simple get Palm; if you need multi-tasking get the Pocket PC. The two platforms are not fungible. The more functions you try to put on a Palm OS device, the less satisfactory the performance will be. Pocket PC will do more, but at the typical Microsoft price of needing the periodic reboot ("reset" in PDA lingo).

Price differences are also tied to various special features-- memory, USB connections, thinness, and color screens. The latter two are especially pricey.

For example, one of the current best buys in PDAs is the $249 Handspring Visor Platinum, which boasts 8 MB of memory, a fast processor, and USB, but a monochrome LCD screen:
http://www.TheNakedPC.com/t/414/tr.cgi?al4

The Visor Prism, which I also like (see TNPC #4.03), is essentially the same unit but with a color screen and that takes the price up to $399:
http://www.TheNakedPC.com/t/414/tr.cgi?al5

Similarly the slimline monochrome Visor Edge also is $399. Slim, incidentally, is a Palm OS specialty. Nothing in the Pocket PC world is as small as the Edge:
http://www.TheNakedPC.com/t/414/tr.cgi?al6

Similarly the Compaq iPAQ, the BMW of PDAs, is $599 in a color bundle:
http://www.TheNakedPC.com/t/414/tr.cgi?al7

If you go with monochrome the Compaq iPAQ drops in price to $349:
http://www.TheNakedPC.com/t/414/tr.cgi?al8

The Visor and iPAQ families have impressed me in testing because of category-leading performance and also expandability. The Springboard module technology for Visors has caught on (see TNPC #4.05), and it means that the PDA's lifespan and capabilities are not frozen.

The same holds with the expansion pack technology from Compaq. I'll have more on that next time.

You can reach Al Gordon at:
mailto:al@TheNakedPC.com

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