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Sony unveils Palm-powered handheld strategy

The company releases additional details about the Japanese version of its upcoming handheld computer as it gears up for a U.S. release of the device this fall.

Sony released additional details about the Japanese version of its upcoming handheld computer, as the company gears up for a U.S. release of the device this fall.

Sony's Japanese arm announced today the launch of two lines of devices based on Palm's operating system. The products will debut under the Palm Powered name and will be released in Japan in September.

Sony will also release a Palm-based product in the United States in September, but the final details of that device have not been completed yet, said Rick Clancy, Sony's vice president of U.S. corporate communications. The device, which was previewed at last month's PC Expo, will resemble the Japanese version in terms of design and Memory Stick capabilities, but may have a different price or brand name, he said.

Although Sony's announcement specifically relates to the Japanese market, the company often uses the Asian markets as a testing ground for future U.S. releases. Analysts said it is likely that the U.S. version of the product will be similar to the Japanese version announced today.

Like the Japanese version, the U.S. Palm Powered Sony is expected to feature links to Sony's ImageStation digital imaging online service, a "jog dial" for navigation, the Memory Stick slot, and Sony's original hardware design.

The Palm Powered line is a central part of Sony's companywide strategy to dominate the networked home of the future with its integrated audio-video and PC products. The consumer electronics giant is trying to parlay its success in the home audio and video market by creating hybrid entertainment and information appliances like the Palm-powered handheld and upcoming PlayStation 2, which will serve as hubs in the broadband-enabled homes of the future.

"Sony's doing what many Asian technology companies do, which is experiment in their own countries before they let it loose in the U.S.," David Thor, a handheld analyst with, said, calling the upcoming PDA a "placeholder." Sony is also working with the European Symbian consortium to create some type of smart cell phone device, he noted. "This is a step toward a converged device."

The Japanese market is growing increasingly crowded, however. Microsoft announced today that its partners, Casio and Hewlett-Packard, are launching Japanese market versions of its PocketPC, and Palm and Handspring have already launched Japanese devices.

The devices will be priced at 55,000 yen, or roughly $510, for the black-and-white version, and 60,000 yen, or $555, for the color version, according to Clancy.

"The hardware is similar," he said. "But there will be an announcement later in the summer."

The Palm Powered products are the first fruits of a licensing agreement between Sony and Palm, which was announced last November at Comdex in Las Vegas. Under the terms of the agreement, Sony has worked with Palm to extend the operating system's audio-visual capabilities and to include support for Sony's Memory Stick expansion technology.

"The goal of our joint effort is to enrich the Palm OS platform and to open up new development opportunities, thus spurring a growth in the handheld computing market worldwide," Alan Kessler, chief operating officer of Palm, said in a statement today.

Sony is working to expand its Memory Stick business to include third-party development of add-on cards offering Bluetooth, digital imaging and global-positioning capabilities, the consumer electronics giant said today.

This is similar to the strategy of another Palm licensee, Handspring, which has made its Springboard expansion slot an integral part of its strategy to compete in the increasingly crowded field.

"This is where they may succeed and make the device ubiquitous," Thor said, noting that Sony's Memory Stick works with all other Sony consumer appliances and PCs, while Handspring's Springboard cards work only with Handspring devices. For its part, Palm has licensed the Secure Digital card, another expansion technology, for use in its own upcoming products.

Sony will launch a Web site for Memory Stick developers to encourage outside support of the technology. Handspring has actively courted third-party software and hardware developers.

Despite the hoopla, Sony's initial attempt at a handheld device appears to be heavy on experimentation and light on the types of features that would guarantee mass-market success, analysts say.

The pricing, for example, is above the realm of most consumers. Palm and Handspring have found commercial success with devices priced between $150 and $400, while Microsoft-sponsored products from Casio and HP have struggled to gain market share because of prices around $500.

In May, Handspring took about a quarter of the retail market, despite the fact that it had only been present in retail stores for a few months, while Microsoft Pocket PC partners Compaq Computer and HP struggled to make a dent.

In keeping with its long-term strategy, Sony is likely experimenting with design and features while biding its time until the technologies in cell phones and PDAs converge into a hybrid device, according to Thor.

"Sony's probably in better shape entering a mature--and dying--market, than Compaq or Casio or Palm, because those companies have no place to go when voice takes over," Thor said, explaining that Sony, like Ericsson, Nokia and Motorola, has experience in creating cell phones that are increasingly offering many of the features of a PDA.