October 15, 2003, 9:40 AM — Dell Inc. formally introduced three versions of the new Axim X3 personal digital assistant (PDA) Wednesday, including a model with an integrated 802.11b wireless chip that costs less than comparable Pocket PC devices.
For US$379, Dell will sell the Axim X3 with a 400MHz XScale processor from Intel Corp., 64M bytes of RAM, 64M bytes of ROM, and an 802.11b chip. The specifications had been revealed on the U.S. Federal Communications Commission's Web site two weeks ago, but Dell announced the pricing information for the first time Wednesday.
Hewlett-Packard Co.'s cheapest iPaq PDA with integrated 802.11b wireless costs $449. The Wi-Fi enabled iPaq h4150, introduced Monday, also comes with Bluetooth connectivity, unlike the Axim X3. It comes with 64M bytes of RAM, but didn't specify how much ROM it will have. HP has two other models with the short-range Bluetooth standard that cost less than the h4150 available on its Web site.
Toshiba Corp.'s e750 Pocket PC comes with an integrated 802.11b chip for $399, but comes with only 32M bytes of ROM. Market leader Palm Inc. sells the Tungsten C with integrated Wi-Fi for $499, but has cheaper Bluetooth models available in its Tungsten lineup.
Dell will eventually offer an Axim with Bluetooth capability, but hasn't yet seen enough demand in the U.S. for such a product, said Tony Bonadero, director of wireless product marketing for Dell, on a conference call with reporters Wednesday. Most of the demand for Bluetooth devices has come from Europe, he said.
But ignoring Bluetooth now could hurt PDA buyers in the future, if they plan to hang on to their devices for at least two years, said Todd Kort, an analyst with Gartner Inc. in San Jose, California. With more and more Bluetooth-equipped cellular phones coming onto the market, "people are going to be sorry if they didn't buy a PDA with Bluetooth," he said.
The linchpin of Dell's business model is delivering hardware at prices lower than the competition, and that trend is continuing in a market where the company has less experience than its competitors. Dell entered the PDA market last year with the launch of the first Axim X5 in two configurations for $199 and $299, below what its competitors were offering at the time.
The company shot to fourth place in terms of shipment market share across both Palm OS and Pocket PC operating systems, and was second behind HP in the Pocket PC category in the second-quarter, according to research from IDC.
But the Axims were viewed initially as heavy and clunky, and Dell's transition to Microsoft's new Windows Mobile 2003 operating system was marked by a series of technical and public relations blunders.