Corporate buyers might be less thrifty than individual
consumers, but they are still slow--especially in the
current cost-conscious environment--to spend significantly
on products that do not make a tangible contribution to the bottom line.
IT and business executives are rightly skeptical about the value
of buying handheld computing devices that are being used as nifty
gadgets--for example, accessing an e-mail account via a wireless
local area network from a conference room. For many people,
the limitations of a handheld's size--such as the small display--make it a questionable substitute for a desktop or laptop
computer that is already sitting on their desks or carried in
At $600 per device--which approaches the cost of a low-end PC--plus additional costs for supporting a wireless LAN and providing
help desk resources, handheld computers must be more than just
functional and interesting. These devices need to either reduce
costs or add to the average revenue per employee--and these
benefits must be tangible, not just vague statements about
"personal productivity"--for the business to be willing to
invest in them.
Handheld computers, much like other peripheral computing devices,
have demonstrated their value for repetitive data entry and data access
tasks for mobile customers in manufacturing, health care, travel,
retail and distribution, field sales and service, among other areas. Compared to
the Palm, the expanded memory capabilities of the Pocket PC are
well suited to these functions, and this is generating the
current momentum for Pocket PC devices, such as Compaq Computer's iPaq, in
the corporate market. Currently, these well-defined tasks are
often handled by periodically uploading data from the handheld
device to the network via a docking station, rather than wireless
If companies have already invested in wireless LANs--and they
have a valid business reason for using and managing that
network--then handhelds that can integrate to that network are
interesting. Companies need to match their requirements against
the features and characteristics of various mobile computing devices to determine which make the most
sense for their users.
Although the Pocket PC 2002 release provides new rich media
capabilities and other interesting features--and the Pocket PC
has gained ground as a rival to Palm--we view these as
incremental improvements rather than innovations that will shift
the handheld market into a higher gear. We do not expect the
growth of the handheld market to accelerate until an expansive
mobile display peripheral can be provided at a low price. That
would be a breakthrough with the potential to double or triple
the size of the market.
Although some individual corporate customers find Pocket PC or Palm
devices to be useful accessories when they are away from the
office or as a note-taking device in meetings and so on, IT
organizations must balance the support needs and wishes of these
people against the overall investment priorities of the
organization. However, even if handhelds are purchased by
individuals, policies and standards should be
established governing how these devices can interact with
individual PCs and the corporate network, and what level of
support will be provided.
It is not feasible for IT groups to simply bury their heads in
sand and say that they are not going to support these devices,
especially because many of the individuals buying them
are high-level members of the organization. There needs to be a
support plan in place for these devices, regardless of whether
the corporation is buying them. And the IT organization must make
the support costs clear to business adopters so they can decide
whether the business value warrants the investment.
From a processor standpoint, the fact that the new devices in the
Pocket PC arena will support only the ARM 4 chip provides a major
boost in the handheld marketplace for Intel. All these makers of
Pocket PC 2002 devices are building their products around Intel
StrongARM chips. So we are seeing a very significant uptick in
Intel's market share in the handheld space, where it previously
had only a limited presence.
We believe companies should restrict purchases of such
computing devices to circumstances where these devices deliver a
clear return on investment. When responding to support requests
from business units, IT groups should educate business executives
on the true costs of supporting handheld devices, such as purchase prices,
wireless modems, networking equipment, support and the like.
To accommodate and manage individual people purchasing their own
handheld devices, the IT organization should provide guidelines,
policies and standards that enhance these devices' usefulness in
interacting with the corporate network or data while minimizing
support costs and potential security risks.
When buying handheld devices or other "pervasive computing"
devices, companies should aggressively seek discounts from
manufacturers eager to build the size of this market.
Meta Group analysts David Cearley, Dale Kutnick, Val Sribar,
William Zachmann, and Jack Gold contributed to this article.
for more analysis of key IT and e-business issues.
Entire contents, Copyright ? 2001 Meta Group, Inc. All rights reserved.