New Palm handhelds, upgrades expected next month

The first week of August, Palm is expected to release a new entry-level device intended to replace the Palm III series. The new personal digital assistant (PDA) will offer a redesigned look and will offer enhanced handwriting recognition, a new flip-up cover and changeable faceplates. It will run on Palm OS 3.5, sources say.

The new device is expected to feature new snap-on covers and a redesigned case that includes a smaller monochrome display, according to sources. Online retailer Neutron USA lists the device with 4MB of memory, although other sources have predicted 2MB. Though sources expect the retail price to be $149, Neutron is listing it at $142.

Also in August, Palm will update the Palm VII, which was released nationwide in August last year. The new Palm VII, which is not expected to include major hardware changes, will feature an updated look with a darker gray case and more applications from content providers.

Palm declined to comment, citing a policy of not speaking about unannounced products.

Palm enthusiast Web sites and message boards have been buzzing about the upcoming entry-level device, speculating on its specifications and capabilities.

"This Palm is poised to launch at the perfect time," wrote Joel Evans, an editor at handheld Web site PDA Geek, which first broke the news of the device. "After all, who wouldn't want to buy their child a new Palm for under $150 that allows the user to completely customize the look of the casing, too? It's definitely the coolest back-to-school gadget that I've heard of so far."

Palm is likely to target the consumer and education markets with the new device and will compete with Palm licensee Handspring.

Some sources wonder how the low-end Palm will fare against Handspring's Visor, which also starts at $149 and comes in different colors but features the Springboard expansion slot. Springboard add-ons allow people to upgrade the device with MP3 players, digital cameras and additional memory.

In September, Palm licensee Sony is expected to release its Palm Powered handheld, featuring support for the consumer electronics giant's Memory Stick expansion technology.

Sources familiar with the new product raised questions about the aesthetics of the design, criticizing the smaller display and new cover strategy.

The new Palms are the first from the company since it released the Palm IIIc, its first product with a color display, last February. They also mark the first major product release since Palm's spinoff from 3Com as a newly public company. The IIIc has had rather anemic sales to date.

Neutron USA is listing the new device as the M100, which would make it the first product from the company to diverge from Palm's established naming convention. As Palm's product line has grown, the company has added Roman numerals and letters to its original product names, which some analysts have said is unwieldy. For example, the original Palm III was extended and refreshed until it morphed into the Palm IIIxe.

Palm executives said previously that the company eventually will re-brand all its products, and sources say they expect the company to focus on the Palm brand name rather than specific products.

The company also has said it will be making a big push into wireless Internet access, eventually equipping all future devices with wireless connectivity options. The first products featuring new wireless options are expected next year.