NEW YORK--Sony and Palm last night unveiled the Clie, the first fruit of their previously announced alliance and the Japanese electronics giant's much-anticipated entry into the handheld computing market.
The basic, monochrome personal digital assistant (PDA) is the first product from Sony since it licensed
Palm's operating system last year. Far from a unique take on the basic PDA,
the Clie resembles a narrowed Palm V with the addition of a Memory Stick
slot and a jog dial for navigation.
The Clie will be available
for preorder starting today from the Sony Web
site for $399. It will be available nationwide in September. The 4-ounce
Clie includes 8MB of RAM and an 8MB Memory Stick, Sony's
proprietary portable memory technology. Eventually, Sony plans to offer
add-on gadgets like digital cameras, using the Memory Stick in the same
manner as the Handspring uses its Springboard expansion slot.
"It's a safe entry--it's not bold, and it's certainly not earth-shattering," said David Thor, a handheld analyst with ResearchPortal.com, explaining
that Sony is going after the Palm V customer. "It's a commodity product,
going after the higher-end mobile professional market."
Clie, which stands for Communication Link Information Entertainment and is pronounced "klee-ay," is a major part of Sony's strategy to dominate the market for networked home appliances, computers and devices.
"Sony has big plans for the Clie as one of the four gateways to the networked
home," Michael Vitelli, president of Sony Electronics, said at the launch
event here last night.
The four gateways are the PC, the PlayStation2 game console, the television and Clie, which is expected to eventually feature wireless Internet access.
The consumer electronics giant, which has also licensed the Symbian
alliance's operating system for smart phones, will release a color version
of the Clie in the United States next year. Analysts expect Sony to
eventually release a family of devices that will feature stronger multimedia and wireless capabilities than the Clie.
Palm is the leader in the PDA market, with 60 percent worldwide market share, according to International Data Corp. The handheld maker has aggressively pursued a licensing strategy to expand its business, signing up high-profile companies such as Sony, Handspring and Nokia.
The strategy, designed to add a new revenue stream for Palm through
operating system royalties, has taken away some hardware market share from
the PDA maker. Handspring, for example, has taken 20 percent of the retail
market in its first three months on store shelves, according to market
researcher NPD Intelect.
"Does Palm really worry if their licensing business is healthy? That's
the highest-margin thing they can do," ResearchPortal's Thor said, noting that Palm's hardware side is being threatened on all fronts by its licensees. "There are products from Sony creeping into the high end and products from Handspring creeping into the low end. And as soon as Nokia and Ericsson start to manufacture devices that tread on the space Palm lives in, then they start to have a real problem."
The relationship between Palm and Sony, which has been rumored to be
somewhat rocky, is quite strong, according to Palm vice president
Mark Bercow, who pointed to his presence at last night's launch event as
proof. "Sony has executed beautifully," Bercow said in his remarks. "We
share a common vision."
The consumer electronics maker has not sold any type of handheld product in
the United States since it pulled out of the U.S. cell phone business last year. Still, the
company that invented the Walkman and Discman portable music players
believes it knows how to succeed in the mobile gadget market. "Sony has the
vision, the resources and the content to realize this vision," Vitelli said. "Sony also has the brand."
Sony may be relying heavily on brand to sell the device, which in its first
version offers no obvious or meaningful hardware enhancements over
existing products. Sony's original plan to release two versions of the
device, one with a monochrome display and one with a color display, was
scrapped because of shortages of the necessary components used in color
Clie eventually may feature a reflective color display developed by Sony and used in Compaq's iPaq device, which is based on Microsoft's Pocket
PC operating system for handhelds. The iPaq is in extremely short
supply and is back-ordered at most online retailers.
"Color displays are rare," said Richard Doherty, president of Envisioneering
Group, who expects Sony to ramp up its own supply of displays. "And
reflective color displays are the scarcest displays on the planet."
Sony also included AvantGo, an application which downloads Internet content
directly to devices, and TrueSync, which synchronizes contact and calendar
information from Microsoft Outlook or Lotus Organizer. "The folks at Palm
were open to collaborating to extend the operating system," Vitelli said.
Despite the initial absence of a color product, Doherty considered the
launch a success.
"It's a win for Palm, and it's a win for Sony," said Doherty, pointing to
Sony-specific applications like its Picture Gear Pocket Software, which
allows people to add images to contact files.
"I'm very impressed," he said.