Microsoft eyeing Palm handhelds for .Net-based applications

LAKE BUENA VISTA, FLA. -- Microsoft Corp. CEO Steve Ballmer said here today that the software vendor, as part of its new Internet-based .Net computing services strategy, will try to put applications such as Word and Exchange on Palm Inc.'s market-leading handheld computers and other mobile devices that compete with Microsoft's own Pocket PC technology.

"No offense to the Pocket PC, but we might need to bring .Net services to Palm and other [handheld] devices," Ballmer said during a question-and-answer session in front of an audience of about 7,000 information technology managers at Gartner Group Inc.'s Symposium/ITxpo 2000 conference.

When asked to clarify his comment in a brief interview afterward, Ballmer said Internet-based services supporting Microsoft's popular office and personal productivity applications "might" be ported to Palm and Palm-licensed devices. Palm "has more marketing position" than Microsoft currently does in the handheld business, he explained.

But Ballmer also said that Microsoft doesn't plan to turn away from the Pocket PC technology, which uses its Windows CE operating system and was released to hardware makers last spring (see story). "No, we're not abandoning Pocket PC -- absolutely not," he said. "We're 100% committed to it."

Embracing the rival Palm devices would be "a logical business strategy" for Microsoft, said Gartner Group analyst Tom Austin. "Microsoft might have been [hoping], 'If we close our eyes, Palm will go away,' but in this case, they haven't," Austin noted.

More than 7 million Palm devices are in use, giving the Santa Clara, Calif.-based vendor more than a 70% share of the handheld market, according to Gartner estimates. Meanwhile, the Pocket PC and Microsoft's older Handheld PC technology have a combined a market share of about 15%. Given those figures, Gartner analyst Phillip Redman said, it isn't surprising that Microsoft would want to use the Palm platform, because Ballmer and other executives at the company "want to be in the [mobile] services market."

Redman said users can already access Microsoft applications such as Word and Excel on Palm devices, with the help of companies like DataViz Inc., a Trumbull, Conn.-based vendor that makes software for use in viewing documents on handheld PCs. But Microsoft could potentially sell even more of its applications if it directly supported them on Palm models, he added.

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