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Handheld makers, analysts look to wireless future

Executives from Palm, Research in Motion, Hewlett-Packard and IBM all came through New York this week, hoping to convince the investment community of their wireless vision.

NEW YORK--Executives from Palm, Research in Motion, Hewlett-Packard and IBM all came through New York this week, hoping to convince the investment community of their vision of the wireless future.

At events such as Merrill Lynch's Hardware Heaven show and venture capital firm Flatiron Partners' Pervasive Computing gathering, executives and analysts argued about which devices will become popular, which services and applications are necessary to pique consumer interest and even whether the technology has already become over hyped. But all agreed on one point: Wireless products will be coming along soon.

Jeff Weitzen "This is the hot area," IBM Pervasive Computing division's Mark Bergman said, speaking at the Flatiron event today. "This is the next big thing."

Consumer electronics giants such as Sony are expected to dive into the market within the next few months, while Compaq and HP, which offer handheld devices based on Microsoft's Windows CE, just released new handhelds.

Others likely will follow. Gateway CEO Jeff Weitzen said that his company will enter the handheld and cell phone market.

"You'll see us move absolutely into the world of the PDA and into the world of cell phones," he told CNET "It might vary by device, and I think you'll probably see three different versions of it. One, you might just see us use somebody else's PDA. Another might be where we re-badge something: We don't manufacture it ourselves, but we do use our logo on it. And a third would be where we manufacture it ourselves."

At the Merrill Lynch conference, Carl Yankowski, CEO of Palm, and Jim Balsillie, CEO of Research in Motion, which introduced its RIM 957 wireless PDA this week, debated which type of device will capture consumers' interest--and wallets.

Carl Yankowski Yankowski and Balsillie, along with Merrill Lynch analyst Bill Crawford, Flatiron Partners' Seth Goldstein--who is hosting today's Pervasive Computing event--and Neopoint CEO William Son debated the future of Internet appliances in a panel discussion at the Hardware Heaven show.

RIM's Balsillie and Palm's Yankowski both argued for simplicity in wireless devices, and both also predicted that an all-in-one PDA with wireless Internet access will probably not successfully be built into a smart cell phone in the near future.

"I want that as much as I want a combination fridge-stove-microwave, and as much as I drink coffee-beer-milk," Balsillie said, drawing laughs from the crowd of investment bankers and fund managers. "The winners will be companies who understand their core competencies."

One combination product is "highly unlikely," Yankowski agreed.

At an earlier event, Yankowski and other Palm executives laid out the handheld maker's wireless strategy, which is to make every existing and future Palm device capable of connecting to the Internet wirelessly, either through add-on devices or built-in wireless access. This week, Yankowski defended that vision, arguing that consumers want choice and simplicity above all else when choosing a handheld.

The wireless craze will likely have large coattails, with peripherals makers such as Hewlett-Packard, for example, targeting printing services for Internet appliances. Speaking at the Merrill Lynch show, HP CEO Carly Fiorina predicted printing will be a "killer app" for wireless appliances.

But executives agreed see story: Technology tussle underlies wireless Webthere is a real danger in over hyping wireless technology, like difficult-to-use WAP browsers and Bluetooth, before the technology is ready for mainstream use. "There's a worry about the hype getting ahead of reality," said IBM's Bregman.

"To think we can solve these issues in the mobile environment, before it's done in the Web environment, is unrealistic," said Flatiron's Goldstein.

For example, Bluetooth, a radio technology which is designed to do away with cables and cords, has been promised for years, although existing technologies like infrared already do the job, RIM's Balsillie said.

Michael Kanellos contributed to this report.