UPS Deal to Replace Drivers' Handhelds

Computerworld - United Parcel Service Inc. has signed a major contract for the next-generation handheld computer and wireless communicator to be used by its drivers. Analysts valued the deal with Symbol Technologies Inc. at $50 million to $100 million.

Atlanta-based UPS declined to provide details on the new Driver Information Acquisition Device, except to say that it will run on Microsoft Corp.'s Windows CE operating system. Holtsville, N.Y.-based Symbol was also reticent, citing a confidentiality agreement with UPS.

Last month, Memphis-based rival FedEx Corp. said it had selected Microsoft's Pocket PC as the platform for the PowerPad, its next-generation handheld system for drivers.

Ethan Cohen, research director at Aberdeen Group Inc. in Boston, speculated that the new UPS device could include a variety of wireless connectivity options, including support for wide-area packet-data networks, Wi-Fi wireless LANs and possibly Bluetooth short-range wireless connectivity—all technologies that FedEx is considering as well.

Craig Mathias, an analyst at Farpoint Group in Ashland, Mass., called the UPS decision to use a Microsoft operating system instead of Palm Inc.'s Palm OS an example of how "Windows CE is going to beat Palm" in the enterprise environment. Mathias said enterprise users are increasingly choosing either Windows CE or Pocket PC because those operating systems are "more tightly coupled with the Microsoft desktop," which predominates in corporate IT environments.

Jason Hertzberg, director of competitive analysis at Santa Clara, Calif.-based Palm, disputed that analysis. "I have a half-dozen major transportation wins," he said.

Palm Fights for Market

Hertzberg added that Palm has regained its share of the commercial reseller market since October, when Microsoft introduced its enterprise-focused Pocket PC 2002. At that time, Palm's share had dipped to 40% of the commercial reseller market, but since then, it has climbed back up to more than 60%, according to The NPD Group Inc., a research firm in Port Washington, N.Y.

Cohen said he found UPS's selection of Windows CE over the more feature-rich Pocket PC operating system "an interesting choice," considering Microsoft's push to move mobile users to the Pocket PC. "Evidently, Windows CE is robust enough to support their applications," he said.

JUST THE FACTS

Driver Devices Contract with Symbol Technologies is valued at $50 million to $100 million. Rollout is planned for 2004. Based on Microsoft Windows CE; rival FedEx is building its device around Microsoft’s Pocket PC operating system. Analysts expect the new device to incorporate wireless connectivity technologies including wide-area packet radio, wireless LAN support and possibly Bluetooth short-range communications.

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