Dell joins the handheld horserace

If one were to judge a market based on the sheer quantity of new products pumped into it, then PDAs would presumably be king of the gadget world. With new PDAs from Dell, Palm, ViewSonic and Hewlett-Packard all hitting the shelves within weeks of each other, it would seem that there’s a handheld revolution on the horizon. Not likely, says one analyst.

While handheld manufacturers have been increasingly focusing on applications suitable for the enterprise customer, large organizations are still standoffish in terms of adopting the devices for more than personal information management. Warren Chaisatien, senior analyst for telecommunications research at IDC Canada in Toronto, said that the adoption of handhelds into the enterprise market has been slower than expected due to a couple of reasons.

“There were missteps by Palm and a few other vendors that created huge delays. Also, there are lingering issues of confusing standards and multiple platforms,” he said.

The newest Palm offering, the Tungsten T, was specifically developed with the enterprise user in mind. At the product’s launch in late October, Michael Moskowitz, the Toronto-based president of Palm Canada, referred to the Tungsten T as the “thoroughbred of enterprise handhelds with workhorse functionality.” With a street price of $799, this racehorse is a big bet for Palm, as it’s up against Dell’s premiere entry into the market, which is priced under the $500 mark.

According to Chaisatien, Dell’s plunge into the handheld arena is a good sign for the industry.

“Dell is not a technology company; it’s a very efficient manufacturing and marketing firm. So when they decide to get into a new segment, it confirms a number of things – the market is big enough to be sustainable, and in terms of growth, the future is there,” he said.

Anthony Bonadero, director of worldwide mobile products for Dell in Round Rock, Tex., confirmed Chaisatien’s speculation. According to Bonadero, the company waited until it determined the market was stable enough and that opportunities were available.

The Axim features functionality appropriate for the enterprise user at an affordable price, Bonadero said.

Part of the appeal of Dell’s offering is the fact that it runs Microsoft’s Pocket PC 2002 Premium operating system, Chaisatien said. He believes that enterprises will embrace the Microsoft OS because it has a similar look and feel to what’s running on those organizations’ laptops and desktops.

“Even though Palm has a bigger market share, research in Canada and in the U.S. in the enterprise market confirms that managers prefer to standardize on Microsoft’s Pocket PC,” he said.

Theodore Babiak, a Toronto-based real estate agent with Royal LePage, has been sold on the functionality of Palm’s Tungsten T, which he beta tested before its release.

A previous user of both the Handspring Trio and earlier Palm offerings, Babiak is satisfied with the Palm operating system.

“I’m familiar with the Palm OS and the idea of jumping from one OS to the next is expensive and time consuming. There’s a lot of people who have written stuff for Palm, and good support out there, particularly in Canada,” Babiak said.

While he’s happy using the Palm OS, Babiak wouldn’t mind if it could talk to others on the market.

“Working on stuff cross platform would be ideal,” Babiak said.

With the ViewSonic V35 Pocket PC (priced at US$299), HP’s iPAQ H5450 with built-in fingerprint scanner (US$699) and its more budget conscious iPAQ H1910 (US$299) joining the race with Dell’s and Palm’s latest, the handheld arena should be active over the next few months, Chiasatien said.

“I would expect the market to get more exciting with all of these products in the market. It should spur some activity,” he said.