Shipments by both Palm and Handspring have been stagnant or falling in the EMEA (Europe, the Middle East and Africa) region for the past three years, according to Canalys figures. Palm shipped 1.3 million devices in 2000, but only about 928,000 in 2002, while Handspring shipped about 117,000 in 2000, about 197,000 in 2001, and 121,130 in 2002. The sluggish sales has been partly due to an overall slump in the handheld market, but the market has stabilised in the first quarter of this year, Canalys said. Palm shipped 226,500 devices in EMEA in the first quarter, compared to Handspring's 19,810. Handspring has a more mature GSM/GPRS line than Palm, Buss said, and has been selling the Treo in Europe since its introduction. By contrast, the Tungsten W was introduced only this year, and has yet to get much publicity in Europe. Handspring has sold the Treo largely through mobile phone operators, and has racked up a number of operator deals in Europe, including operators mmO2 and Orange in the UK. Those deals will come in handy for Palm, Buss predicted. Hard work ahead
The combined company will have its work cut out in carrying the Palm OS platform forward and extending it into more lucrative markets, according to Canalys. Microsoft has been busy signing up licensees for its Windows CE-based mobile operating systems, such as Windows for Smartphones and Pocket PC, while most major mobile phone makers have now signed on to make smartphones based on the Symbian OS. In the mean time, the number of Palm OS licensees has been falling, with Handera recently cutting off its Palm OS line. After the acquisition, Palm and Sony will be the only two companies with a significant Palm OS programme, although PalmSource, which looks after the Palm OS, is actively recruiting more licensees, Buss said. The Palm OS doesn't yet have the enterprise cachet to match Windows, either, he said. However, that could all change. "If Palm can accelerate its next-generation OS, get a couple of significant licensees, and come up with a few innovative applications, it is well positioned to retake the market," he said. "And don't forget that today the handheld market is dominated by consumers, and that's where Palm is strong."
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