Palm president sees dim future for cell phones

Palm president Alan Kessler made it clear yesterday at the Mobile Insights conference that the platform for the next wave of e-commerce will be the Internet.

The key component driving that shift will be wireless access, Kessler told the audience of mobile industry product and service vendors. However, despite recent deals between Palm, Nokia, and cell-phone OS developer Symbian, Kessler said cell phones will never become the standard device for either business to business or business to consumer applications.

The Palm president backed up his prediction by telling the audience that this week Fidelity Investments will announce that the company's customers, or at least their heavy traders, will receive a Fidelity-branded Palm VII. Kessler mentioned other market segments, such as the health care industry, that currently use Palm devices as well as the Internet to conduct business.

Kessler ticked off a number of reasons why he believes that cellular phones will not replace handheld devices in the foreseeable future. Among the barriers mentioned to corporate adoption of cell phones was poor display, slow access, and the tedious process typically experienced by cell phone users as they work their way through menus to get to features.

The churn rate on handsets among customers is high, according to Kessler. And one reason for it is that IT organisations are not tied to any one company and are continually making more competitive deals tied to better service rates. However, the ability to change handsets would be sharply limited if handsets held mission-critical data.

"If that happens, IT realises the handset manufacturers will have them where they want them," Kessler said.

At the end of the day, most people will have two devices, said Kessler, who noted that Palm is investing heavily in Blue Tooth technology as a cable replacement for transferring data between a Palm and a cell phone.

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Ephraim Schwartz

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