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Sony handheld to use Sony chip

The consumer-electronics maker announces that its Clie PEG-UX50 will use a chip of its own making called the "Handheld Engine."

Consumer-electronics maker Sony Electronics on Thursday announced a new addition to its Clie line of handhelds that will use a processor of its own making.

The Clie PEG-UX50, which will use a chip called the "Handheld Engine," is expected to be announced Friday at a press conference in San Francisco. The device will be available in Japan starting Aug. 9 and will use version 5.0 of the Palm operating system, have a built-in digital camera, include Bluetooth- and 802.11b-based wireless connectivity, and have color screen resolution of 480 pixels by 320 pixels.

The device also marks a departure from the vertical tablet design of its previous generation, going for more of a miniature notebook case. A U.S. release of the device is planned for early September, according to a source.

The device is also noteworthy because it is the first handheld to use a chip developed by Sony in the same Nagasaki plant where it is manufacturing the chip that will power the upcoming Sony PlayStation 3 game console.

Sony has been investing in semiconductors to increase the value of its products and teamed with Toshiba and IBM in the chip plant.

The ARM-based chip tops out at 123MHz and includes a graphics engine, camera interface and Memory Stick interface.

The market for handhelds has been on the decline of late, with worldwide shipments falling 21 percent to 2.45 million units in the first quarter, according to research firm IDC. Demand in the business and consumer markets has cooled despite new devices and lower prices.

The decline was attributed to the poor states of the economy and technology industry as well as to the inability of device makers to develop a product that is considered a must-have for businesses.

In the first quarter, Sony lost its No. 2 market share position to Hewlett-Packard. HP has about 18 percent of the market, and Sony has just more than 16 percent. Palm maintains its No. 1 position in the market with 36 percent.