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Palm trims prices on three handhelds

The hardware division of the handheld maker cut prices by up to 20 percent on three of its devices, including its latest product, the Tungsten T.

The hardware division of handheld maker Palm made price cuts of up to 20 percent on three of its devices, including its latest product, the Tungsten T.

The Milpitas, Calif.-based Palm Solutions Group said Tuesday that effective immediately it has cut prices on the m130, the m515 and the Tungsten T, which was unveiled in late October. The m130 had been selling for $249 and was reduced 20 percent to $199. The Tungsten T was also cut 20 percent to $399, and the m515, which dropped in price in late September, was cut to $299 from $349.

The m130 and the m515 sold well in the fourth quarter, which is traditionally one of the peak selling periods of the year. The m130 was the No. 2 best-selling unit, and the m515 was the fifth best-selling unit, according to retail market tracker NPDTechworld. The Tungsten T ranked as one of least popular handhelds sold in the fourth quarter at No. 14.

Handheld buyers focus more on price during the holiday season, according to Stephen Baker, an NPDTechworld analyst. Average selling prices fell to $217 in the fourth quarter compared with $260 in the first quarter. Palm was able to capitalize on the trend toward lower prices in the fourth quarter with its $99 Zire, which was the top seller in the market.

Palm said in an e-mail that the price moves were designed to increase sales and create additional demand for the handheld category by attracting new consumers. The company has been targeting mainstream, less tech-savvy, buyers. The company's operating system subsidiary, PalmSource, in mid-January said that it would begin using a new and more intuitive handwriting-recognition software to replace its signature Graffiti program.

Palm and other handheld makers have been looking for new methods to resuscitate the slumping handheld industry, which shipped 9 percent less devices in 2002 than in 2001, according to Dataquest, a unit of research firm Gartner.