Even though Palm's
(Nasdaq: PALM) operating system still owns more than
half of the PDA (personal digital assistant) market,
Microsoft  's (Nasdaq: MSFT)
marketing engines are roaring.
With Microsoft aligning with Intel , and making a full-court press to capture
more of the mobile operating system market, it is not hard to see a new
battle brewing that echoes the Microsoft-Netscape brouhaha from the 1990s.
This time, though, the battle is about more
than just browsers. It is about full operating systems, and Palm now is the
would-be David facing the Goliath of the software industry.
In just a few years, the software giant has been able to capture
more than 20 percent of a market that it never even flirted with
before. From 2000 to 2001, Microsoft more than doubled its
share of the mobile operating system market from 10 percent
to 21 percent, according research firm Gartner Dataquest.
Even if they do not admit it, the executives at Palm have to be
worried.
Fight Club
Palm is moving aggressively to hold on to its market share.
The latest evidence of this fact is in Palm's
new operating system.
Coming on the heels of Microsoft's launch of Pocket PC 2002, Palm OS 5 is
supposed to be available this summer. It is in a good number of developers' hands
already.
But OS 5 may not be big enough to keep Microsoft boxed in.
"I'm not so sure that this effort's going to completely help them repel
Microsoft," Gartner Dataquest analyst Ken Dulaney told Wireless NewsFactor.
Aiming Young
Palm does have some cards in its hand, however. It is those qualities
that have helped it maintain its chunk of the market -- a 57 percent share in 2001,
according to a Gartner Dataquest report.
One of the key advantages for Palm is price point. Those
prowling the PDA market with less than US$400 in
their hands head straight for a Palm OS device.
In November, Palm executives told Wireless NewsFactor that they are
targeting a younger market with less cash to spend.
Palm is looking to spoil the youth, so they will remain loyal to the
platform. And because a Palm OS device can cost as little as $100,
the company has the best chance of wooing the shallow-pocket crowd.
"Palm still maintains a huge advantage in the way of installed base,"
Aberdeen analyst Isaac Ro told Wireless NewsFactor.
"While the Microsoft marketing machine has certainly gained
a ton of mindshare in recent months, the fact remains that the OS is
still in a minority position with regards to actual shipments." (continued...)
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