Handspring to developers: Remain calm

"We will continue to manufacture and sell Visor products as long as there is sufficient demand and we are able to build them," Handspring co-founder and Chief Product Officer Jeff Hawkins said last week in a letter to developers, which has since made the rounds on various handheld enthusiast sites. "It is natural that as demand dictates, we may reduce the number of (products) and the geographies and channels in which they are available."

Handspring spokesman Allen Bush said Tuesday that the company sent the letter in response to concerns from developers after the company's earnings conference call Jan. 15.

"We're talking about a very long-term vision," Bush said. "We have no plans today to end the Visor line."

CEO Donna Dubinsky said on the Jan. 15 call that the company is transitioning its business and will eventually stop making traditional handheld organizers in favor of wireless communicators that incorporate traditional handheld functions, such as the upcoming Treo.

When the Visor line debuted in 1999, it was noted for its colorful hues and its signature Springboard expansion slot. Over time, the slot has allowed the Visor to add memory as well as hardware, including an MP3 music player, a cell phone and even a massager. At this point there are dozens of Springboard modules.

Handspring is not alone in shifting its focus to the wireless world. A number of handheld makers are looking to the wireless market as a way to escape the tough competition and price wars that have stung the organizer market in the past year.

Lehman Brothers analyst Joseph To said Handspring is right on both fronts, both to focus on its wireless products and to try to keep the loyalty of as many developers as possible.

"I think it's important for them obviously not to burn any bridges as they transition," To said. "Who knows, maybe they'll introduce (a Treo) that has a Springboard (slot) down the road."

IDC analyst Kevin Burden said Handspring's move illustrates the danger that third-party hardware developers face when designing products that connect to one device or one brand of devices, as opposed to a whole class of devices.

Handspring is not the first to run into this challenge with developers.

Last year, handheld leader Palm adopted a universal connector for its devices after hearing complaints from add-on makers that their products quickly became obsolete once new handhelds were introduced.

Burden added that it is natural for handheld makers to continue to try to innovate, given that no company has yet found the exact mix of features and design to make handheld computers truly ubiquitous.

"On a grander scale, we're still trying to figure out where these devices fit," he said. "Until you start to see real huge volume shipments by enterprises, you're going to see a lot of experimentation."

In the letter to developers, Handspring said that for now it is focusing on three devices: its recently introduced Visor Neo and Visor Pro models, as well as its thin Visor Edge. The Visor Edge does not come with a built-in slot for a Springboard module, although the attachments can be added to the Edge using an add-on backpack that comes with the handheld.

The company has not put a time frame on how long it will remain in the traditional organizer business. And Handspring will not say whether it is developing future Visor models.

Burden said developers should not be shocked to learn that Springboard may not live forever, given that no company other than Handspring uses it.

"The writing has been on the wall for some time for Springboard," said Burden, who noted that many Springboard modules cost nearly as much as the Visors themselves.