By Jo Maitland
Dell Computer Corp will take the plunge into the PDA market next week, despite company CEO Michael Dell steadfastly denying any interest in the product category for several months. The company’s first foray into the market will be a licensing deal on Monday with Research in Motion Ltd, for its popular BlackBerry wireless two-way digital pager. Dell is also looking at compelling forthcoming versions of the unit, sources close to the Round Rock, Texas-based company said. A Dell spokesperson at Comdex this week said that there has been no talk of a takeover, despite rumors at the show. We are simply a channel for this device, he said. We are learning about wide area wireless email and evaluating a number of other products. He would not specify which ones.
Dell says the BlackBerry is an ideal fit within its portfolio as it works well in large corporates. Many Dell executives including Michael Dell already use the product. Unlike most handheld devices, the BlackBerry has built-in wireless support for Microsoft Corp’s Exchange through a single mailbox. We sell a lot of Microsoft products so this sits well with us, the spokesperson said. RiM has been criticized in the past for being limited to just Microsoft exchange and spokespeople at Comdex agreed. We are working on it, they said.
Some analysts have questioned how Dell can make money in the extremely low-margin pager market. Jack Gold, head of the mobile and pervasive computing practice at the Meta Group, said: I don’t know why Dell would want to do this. They have shied away from companion devices in the past, and I don’t see how they’d make any real money doing this. BlackBerry is kind of neat, but the money is in selling ongoing services [paging] and connections [email, alerts etc]…Dell should build a real companion device…if they’re going to get into the business.
As with regular email, BlackBerry enables users read, reply to, create and forward messages. And like 3Com Corp’s popular PalmPilot, the BlackBerry features a cradle that connects directly to a user’s PC for synchronizing contact information. An Intel 386 processor powers the BlackBerry and its wireless service is provided nationwide by BellSouth Corp for a flat monthly rate. Initially, Dell intends to sell the BlackBerry though its large corporate accounts, but it is likely to be available on Dell’s web site next year, according to sources.
According to a report by Merrill Lynch this summer, Research in Motion was on the verge of usurping Palm Computing as the new king of the US handheld scene. However, since then, Palm has spent millions of dollars in advertising the Palm and is thought to have over 70% market penetration.
RIM spokespeople said they were unable to discuss the plans for a new device with a larger screen, code-named Stretchfrog, that ComputerWire had been told would launch this year. However, one spokesperson said: It hasn’t gone away.
Elsewhere on the wireless front, Dell plans to give wireless LAN access to its Optiplex line of PCs, with an Aironet brand radio that fits into a card slot on the PC and works with an Aironet access point, which can support up to 50 users at distances of 300 feet and data rates of up to 11Mb per second.
