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HP doesn't want Bluetooth to fly solo

Around the time Hewlett-Packard begins selling its Bluetooth PC Card this fall, the company plans to introduce options for incorporating the radio technology into its handhelds and printers.

Hewlett-Packard isn't just adopting Bluetooth. It's building an ecosystem around it.

Bluetooth--the radio technology that lets notebooks connect to cell phones, handheld computers, and some peripherals without wires or cables--has been touted as both the next big thing and the next big headache. Although the concept is alluring, analysts and others have noted that Bluetooth-enabled notebooks will come out before the devices to which they can connect.

HP is getting around the speed bumps, however, and will begin offering its own Bluetooth options in November, according to sources close to the company.

Around the time that HP starts selling its $149 Bluetooth PC Card, the company also plans to introduce options for incorporating Bluetooth into its Jornada handhelds and its popular line of printers.

With Bluetooth, people don't need a wireless modem or separate wireless Internet account on a notebook to connect to the Internet. Instead, the notebook sends radio signals to a cell phone, which then connects to the Web. In addition, notebooks outfitted with Bluetooth can connect automatically to handheld computers and peripherals such as printers for a quick sync or a dispatch of data.

Ultimately, HP hopes that Bluetooth will be the way that people can print directly from their cell phones, pagers and handhelds without needing a computer as intermediary, Pradeep Jotwani, general manager of HP's consumer business unit, said today at a Banc of America Securities' analyst conference in San Francisco. Naturally, HP hopes to make printing as easy as possible so it can sell more printers and supplies such as inkjet cartridges.

Cahners In-Stat Group forecasts that shipments of Bluetooth-enabled wireless communications devices will exceed 1 billion units by 2005.

HP's Bluetooth PC Card is made by 3Com, and Motorola supplies similar products to IBM and Toshiba.

"Bluetooth adoption is progressing slower than many companies expected," Cahners In-Stat analyst Rebecca Diercks said. One issue is the high cost, she said. Incorporating Bluetooth adds as much $50 per unit.

Another, and perhaps more significant issue, is that the industry has begun to put its energy into a more mature radio technology, called 802.11B. And while the newer technology is good for wireless connections to devices within a few feet, 802.11B lets portable devices connect to corporate networks or the Internet over distances as great as 300 feet.

A handful of Bluetooth products are starting to emerge from labs. IBM and Toshiba already have announced Bluetooth options for laptops.

In a related matter, Texas Instruments yesterday announced the availability of its Bluetooth chipset. The 0.18-micron ROM-based wafer is designed for enabling cellular phones and other consumer devices with Bluetooth.

The Bluetooth chip is expected to be available in volume early next year for $5 apiece in lots of 2 million.

With chipmakers like Texas Instruments only now getting core Bluetooth components to market, many analysts estimate cellular phones and other devices using the wireless technology are anywhere from three months to a year away from reaching the market.

"Bluetooth is more of a 2002 story," Gartner analyst Martin Reynolds said.

By taking a proactive approach of immediately offering Bluetooth options for its own products, analysts say, HP is in some ways better positioned to reap immediate benefit from the radio technology.

News.com's Stephen Shankland contributed to this report.