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New Windows-based handhelds coming

Despite manufacturer defections and strong competition from Palm Computing, makers of Microsoft-based handheld devices keep plugging away, with several products set to be released next year.

Despite manufacturer defections and strong competition from Palm Computing, makers of Microsoft-based handheld devices keep plugging away, with several products set to be released next year.

The market for devices based on Microsoft's scaled down Windows CE operating system has been turbulent during the last year. For instance, manufacturers of handhelds such as Everex and Philips have discontinued their CE-based products. Microsoft also has undergone internal strategy shifts, the most recent being the company's decision to relaunch the products under the "Windows Powered" name.

Despite Microsoft's determination and deep pockets, the company has been stymied in its attempts to dominate the handheld market. The company has revised the Windows CE operating system three times in response to customer and retailer complaints, but sales aren't keeping pace with competitor Palm Computing.

Sales of Palm devices account for nearly 75 percent of all digital devices sold, according to market research firm International Data Corporation.

This week reflected the ongoing chaos in the Windows CE market. Hewlett-Packard and NEC showed off new Japanese models of their devices, while Khyber Technologies filed a patent infringement lawsuit against HP, Philips and others, alleging that the companies illegally used Khyber's audio technology.

Filed on December 2, the Khyber Technologies' lawsuit alleges that the companies infringed on its technology to store and retrieve audio messages by writing on the screen of the devices.

"For a small company like us...it is unfair that after making such a substantial investment, we are being pushed out by the giants in the field," Khyber's president, Raj Kumar, said in a statement.

HP declined to comment on the suit; Philips has already abandoned the market.

Amid the acrimony, some manufacturers continue to announce products, such as NEC's Mobile Gear II MC/R730F. The newest version for the Japanese market can identify fingerprints, according to Nikkei, a Japanese business publication.

Expected to be available at the end of January, users will have to place their finger on a sensor to turn the computer on.

NEC's solution to the problem of security differs from Compaq's approach--its devices store data on a removable memory card.

Meanwhile, HP reportedly is set to introduce the newest palm-size PC in its Jornada line in Japan next summer. The new device is expected to be lighter and thinner than earlier models.