Microsoft has been able to build on the ubiquity of its Windows software, says Mobile Insights' Scannell. Software developers, hardware developers and users are all familiar with Windows. Palm prides itself on the simplicity of its products, and criticizes Microsoft for trying to cram all the functions of a PC into too small a package. But there is no doubt that many buyers are attracted by the promise, even if the reality proves unwieldy. Meanwhile, Palm has only recently introduced a colour screen.
Palm finds itself at a crossroads.
An advertising campaign last year emphasized the Palm OS far more than Palm's own hardware. This was a sign, analysts said, that the company was ready to bite the bullet, abandon hardware as its main source of revenue and begin to rely more on licensing fees. Last December, Palm announced a new licensee, Samsung of Korea, and has discussed licences with several companies in Taiwan. In a written response to questions from the Review, Palm confirmed that it's committed to its licensing programme. However, Scannell of Mobile Insights believes that in the current economic climate, Palm is unlikely to let go of its hardware lifebelt.