Palm targets first-time users with new low-end Treo

Palm Inc. announced a low-end version of its Treo smartphone on Thursday, hoping to win over casual users beyond the core "mobile professionals" market segment.

The Treo 680 smartphone can reach the international quad-band GSM (Global System for Mobile Communications), GPRS (General Packet Radio Service) and EDGE (Enhanced Data Rates for GMS Evolution) networks without an external antenna.

Palm hopes to attract customers who have never used a smartphone by offering more than the usual business suite of e-mail and conference calls, adding popular applications like Google Maps, eBay auctions, Yahoo links and Flickr pictures. A smartphone with Google Maps can use its own location to provide users with driving directions, traffic reports and searches for local restaurants.

The company will use the Treo 680 to compete with rivals such as Motorola Inc. by offering a lower price and longer battery life, said Palm Chief Executive Officer and President Ed Colligan.

"We did not want to sacrifice a full day of usage just to get a little thinner," he said during a press conference at the DigitalLife trade show in New York. "The Motorola Q has had real issues around battery life because of design tradeoffs."

He did not announce a specific price, saying that telephone carriers would set their own prices when they bring the Treo 680 to market in about a month. Colligan predicted that 20 carriers would be selling the product worldwide by June 2007.

"This will be competitively priced with similar-featured smartphones, so pound for pound this will offer the best features for the value," he said. Some analysts expect the phone will retail for about US$199, according to The Wall Street Journal.

If Palm succeeds in reaching beyond its usual mobile professional buyers, it could tap a potential marketplace of 210 million customers, more than nine times the size of the business market, Colligan said. These people are "mobile accomplishers" who now use feature phones instead of smartphones and buy electronics with their personal funds instead of an expense account.

Buyers who prefer the speedy UMTS (Universal Mobile Telecommunications System) network can choose a smartphone from Palm's existing higher-end models, such as the new Treo 750v, he said.

In another change, Palm has contracted with Inventec Corp. of Taiwan to manufacture the Treo 680, as opposed to its usual hardware partner, HTC. The Treo 680 will have a 312MHz processor from Intel Corp., 64M bytes of memory and an expansion slot for up to 2G bytes additional storage.

IDG News Service

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