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Commentary: Pocket PC advances

Although Microsoft's Pocket PC 2002 operating system doesn't introduce any revolutionary new technologies, it should prove useful to more business users.

    Although the Pocket PC 2002 operating system does not introduce any revolutionary new technologies, it has made several important evolutionary steps that should make it more useful to more business users.

    However, we expect the Pocket PC to appeal primarily to corporate users, for whom its relatively high-cost ($500 to $700), feature-rich environment is not a hindrance (compared with the cost-driven consumer sector, where Palm and Handspring compete fiercely for market share and where new low-cost entrants are beginning to appear).

    In the past, Pocket PC (and earlier Windows CE) personal digital assistants (PDAs) were criticized for their relative complexity of operation and lack of simple facilities when compared with the rival devices based on the Palm operating system. Pocket PC 2002 has made many of these operations simpler and more user friendly, and though its interface still is more complex than that of Palm, for many users it offers much greater capabilities that make up for such complexity.

    Indeed, with Pocket versions of Outlook, Word, Excel and Internet Explorer, corporate users find a close affinity to the Microsoft-dominated PC world of their daily desktop applications, and an easy connection for users of Exchange.

    With Pocket PC 2002, Microsoft's new reference design has forced all manufacturers to move to processors based on an ARM core, with the beneficiary of this decision primarily being Intel with its StrongARM processor chip. Indeed, every new Pocket PC to date uses this chip--a change from the past, when only Compaq employed it. This standardization benefits software vendors, who are now able to supply compiled programs in only one flavor, vs. the multiple flavors of previous generations.

    By contrast, all four Palm-based PDA manufacturers (Palm, Handspring, Sony and HandEra) use the same Motorola DragonBall processor, so almost all third-party software will run on any of their platforms without the need for changes.

    Flash features
    Microsoft has also mandated that all Pocket PC 2002 PDAs use flash ROM to hold the operating system. Although this adds an incremental increase to the price of the units, it enables the vendors to provide downloadable upgrades for the operating system that can be flashed into ROM. Previously, only Compaq's iPaq and some Palm PDAs provided this capability.

    Owners of PDAs that do not use flash ROM cannot upgrade their systems when new versions of their operating system appear. Owners of PDAs from other suppliers are required to buy a new unit if they want the latest version of the system software--a costly pill to swallow for users who paid $600 for a device.

    See news story:
    Palm reaches out to developers
    Manufacturers that move to flash will alleviate this problem, and such a move will also enable them to add enhanced features and functions and upgrade those functions (including customization such as special screens, customs portals, drivers and so on). And while black-and-white units are possible, we expect vendors to offer only color units (a recent black-and-white iPaq offering did not sell well).

    All this processing power, color display, backlighting and peripheral support come with a price in battery life, and many users have complained that previous versions of Pocket PC devices have had very limited battery life. (Pocket PCs are much more power-hungry than Palm devices.) New versions of Pocket PC PDAs include high-power Lion batteries, and several are designed with removable batteries so recharging can be done less often.

    Microsoft's clear focus on the enterprise is evident in its strong support for multiple networking technologies. Under the covers, Microsoft has added drivers for both Bluetooth short-range wireless and 802.11b wireless Ethernet, enabling Pocket PCs to run either built-in wireless interfaces (in future units not yet on the market) or interface cards. This will be an interesting feature for users in offices equipped with 802.11b wireless LANs, who will be able to check and send e-mail, or check internal information sites and even Web sites from wherever they happen to be in the office or on the plant floor.

    The latest version also supports virtual private networks and has a Windows Terminal Server client included to provide network encryption and strong authentication to corporate networks, and enable thin-client access to enterprise applications.

    Third-party software
    Pocket PC has also lagged Palm in the number of third-party software developers selling products for the platform. Although some Palm products (such as several word processors and spreadsheets, e-mail attachment viewers, e-mail interfaces) are essentially replacements on the Palm platform for Pocket Office and other native Microsoft functionality, others offer a wide variety of personal and potential corporate functionality. However, an increasing number of those developers and others are bringing out software for the Pocket PC 2002 platform.

    Despite Palm's early lead in development support, Microsoft has an incredibly large audience of potential developers already using its development environments (such as Visual Basic). As it adds Pocket PC-specific libraries and tools, Microsoft will rapidly surpass Palm in enterprise software deployments. Further, Microsoft is producing a version of .Net Compact Framework to work with the Pocket PC (and other WinCE platforms), giving these devices an advantage over Palm in future .Net environments.

    Microsoft has also improved remote manageability features on the Pocket PC with an eye to the needs of corporate users; among the additions are hooks for security software. PDAs face two important security challenges. First, like desktop computers, they are vulnerable to virus and worm attacks--though so far, only a few minor attacks have materialized.

    However, by their nature, they are less susceptible to data loss than desktop systems, because PDA users regularly back up their data to desktops (and, if they are wise, from there to a server or removable media) to guard against file corruption, battery failures and other events that put data on PDAs in general at risk. Therefore, users can always wipe the memory of their PDA and reload their last backup if a virus does attack. Although some antivirus software has appeared for Palm (Symantec), we see this as a fairly low-risk situation.

    The second--and larger--danger is theft or loss of PDAs that contain sensitive corporate data. This is not new--laptops have been stolen or left behind in the past, and even desktop PCs have been known to disappear from offices overnight. However, the smaller PDAs in general are much more susceptible to loss and theft because of their size.

    Encryption inconvenience
    The main protection approach against this problem is encryption of the data on the unit and/or removable data storage (such as CompactFlash). Although several solutions are available for both the Pocket PC and Palm platforms (such as Certicom), so far few users have encrypted their PDAs because of the inconvenience. We do not expect this to change until such encryption is forced on users by enterprise policies.

    User organizations should conclude that, while Pocket PC 2002 devices may replace laptops for a minority of users with limited needs on the road (such as access to e-mail and form-based access and entry to some enterprise applications), for most mobile users these will still be companion devices rather than replacements for laptops.

    The growth in the number of Pocket PC makers can enable businesses to play one off another to get the best deals when planning to issue PDAs to their users. However, before they start such a program, companies must establish clear policies on how they will support use and what use is permitted.

    Companies that have standardized on Microsoft environments (e-mail, development and so on) will find a closer affinity to the Pocket PC than to Palm PDAs, and with its greater processing power, expandability and connectivity options, we expect enterprises to move in greater numbers to Pocket PC and away from Palm devices. Also, enterprises will be much more comfortable working with a large enterprise supplier, such as Compaq Computer or Hewlett-Packard, than a small, less financially stable vendor such as Palm or Handspring.

    Meta Group analysts Jack Gold, David Cearley, Ashim Pal, Peter Firstbrook, Jeffrey Mann, Val Sribar and William Zachmann contributed to this article.

    Visit Metagroup.com for more analysis of key IT and e-business issues.

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