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It’s here — handheld wireless

Palm’s new PDA keeps users hooked up to Web, e-mail

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SANTA CLARA, Calif. — A long-awaited wireless handheld from Palm Inc. was set to hit stores Monday, giving the world's leading personal digital assistant (PDA) maker a new weapon in its fight against encroaching competitors.

The new i705 personal digital assistant has a built-in antenna for wireless Web access and secure, "always-on" access to e-mail and instant messages through its Palm.net service. The device is a replacement to the Palm VII models that were bulkier and did not have as many features or a rechargeable battery.

The PDA weighs 5.9 ounces and has the same SD-expansion card and universal connector slots like that of other new high-end Palm products. To avoid the battery drain of a color screen, Palm will only release it with a monochrome screen.

The $449 device is targeted at the lucrative and growing corporate customer market — a segment Palm wants to dominate and one that company officials and industry observers say is critical for Palm's long-term success.

Palm holds the lead in worldwide market share but saw its share drop to 43.6 percent in the fourth quarter of 2001 from 53 percent in the year-ago period, while shares of Microsoft Corp.'s Pocket PC-based devices grew, according to the International Data Corp. market research firm.

Research In Motion's BlackBerry e-mail pager, which was previously the only handheld device offering an integrated "always-on" connection, has also been popular among business customers.

"Pocket PC continues to be a powerful and serious option for the (corporate market), but now Palm has a serious offering that takes it on head-to-head," said analyst Tim Bajarin of market research firm Creative Strategies.

Palm — already struggling last year to recover from operational missteps, including a massive inventory glut from the economic downturn and stalled sales from pre-announcing its m500 line — took more criticism when it twice delayed the i705 launch.

Company officials acknowledged they needed the time to make software refinements.

"We could have pushed it out the door, but it wouldn't have been the right thing to do," said John Cook, Palm's senior director of technology marketing.

The delays were probably prudent, Bajarin said. "This is such an important product for them," he said. "It's better to do it right now than to have done it wrong three months ago and have egg on their face."

Palm last year hired a new slate of executives and restructured the company. Analysts so far are impressed.

"At nearly every key position, we sense that management is better organized, better focused and more experienced, especially for the enterprise market," U.S. Bancorp Piper Jaffray analyst Bill Crawford stated in an investment note Friday.

The new wireless product will boost Palm even more, analysts said.

"You can't hit a home run every time at bat, but if you're going to stay in the game, you have to hit doubles and triples, and in this case, I think they have a very solid hit," Jim Forbes, executive producer of DEMO technology forums, said of the Palm i705.