Glitz and gadgets go hand in hand at Comdex

Microsoft used this year's Comdex to unveil its TabletPC, but it was Sony and Handspring that stole the show at the Las Vegas gadget extravaganza.

We all knew that this year's Comdex show in Las Vegas was going to be a gadget-ridden affair, but no one could have predicted the extent to which the lines between consumer and business products would have blurred.

For resellers looking for fresh products as a way to improve margins or break into new markets, Comdex was a goldmine, covering everything from executive toys to enterprise-level application servers.

Bill Gates, Microsoft's chairman and chief executive, set the initial tone when he demonstrated the supplier's new TabletPC. This looks like an over-sized Palm device, but is a fully functional Windows PC-based appliance that does not have a keyboard and is operated using a pen.

The official line was that it will be powered by an Intel X86 chip, despite rumours that it is more likely to be based on a Transmeta processor. But before resellers get too excited, a Microsoft representative said the TabletPC is not scheduled to hit the market until "sometime in the next 18 to 24 months".

Unsurprisingly, Mark Dadger, product manager at Handspring, said: "There is so much momentum behind handheld devices that I'm not sure whether Microsoft has got the timing right."

But Gates' aim is to move the enterprise computing debate away from a server-centric view - a model adopted by vendors such as PeopleSoft, Siebel and others. "The browser is showing its age. There is talk of Napster-style peer-to-peer computing, and that's OK," he claimed.

But Microsoft's arguments in favour of the TabletPC need more meat on their bones. A pen and paper approach requires the development of solid technology that can accurately recognise hand-written scripts. Jeff Bellamy, product manager at the software giant, said: "The TabletPC will capture text as it is."

As anyone who has used Palm's Graffiti will attest, however, such an approach is not very accurate. "This remains an area of tough work," said Dadger.

Keeping Windows open
But the TabletPC will also include voice recognition (VR) software, although not the applications that Microsoft currently licenses from Lernout & Hauspie.

"We're doing our own stuff," the Microsoft representative said. But he admitted that the software would only support American English, Chinese and Japanese in the short term, therefore effectively excluding the UK initially as a market.

The Redmond giant claimed that the TabletPC would not replace Windows CE devices, but would complement them. It was silent, however, about what would happen to CE in the future - most analysts agree it has been a failure compared with other handheld operating systems.

Of more immediate interest was a demonstration of Office 10, Microsoft's latest version of its personal productivity applications suite. Due to be released towards the end of the first half of 2001, Office 10 makes heavy use of XML and enables much better application collaboration than current and past versions.

Gates attested: "The XML model allows the interface to be separate from the software. This meets the need for a new generation of Office tools that allows unconstrained innovation."

From a reseller perspective, Microsoft's adoption of XML as a cornerstone of its Office applications could enable them to develop custom interfaces so they can integrate the packages with enterprise-class applications. This would require them to acquire new skills, however, at a time when the creation of an XML standard is still some way off.

At a recent analysts' conference, Tony Friscia, chief executive at AMR Research, said: "If you look at the efforts to standardise, they have all failed. In reality, [XML] will be vendor-driven."

Microsoft's ability to dominate the XML-based application market is far from certain, however. The RosettaNet consortium, OBI and other software vendors have made substantial progress in developing standards that have been adopted by specific industry sectors.

Microsoft, on the other hand, has delayed the shipment of its BizTalk Server, a repository for XML schemas, but suggests it may be ready by February 2001. Resellers will then be able to look at how many vertical sector packages BizTalk supports and decide whether it is worth pursuing. Application vendors in the Microsoft stable at Comdex included Sage, Royalblue and Epicor, so Microsoft may yet make substantial inroads into this space.

Elsewhere in the office applications category, however, Corel gave a sneak preview of WordPerfect Office 2002, which is scheduled for release by mid-2001. Graham Brown, executive vice-president of business applications at the company, described it as "the most important upgrade since WordPerfect 5.1".

Corel Central provides serious groupware capabilities, including the ability to assign tasks to diaries. It also has a new IMAP4-compliant email client. The Quattro Pro 10 spreadsheet is fully compatible with Excel, and all of the packages are fully compatible with Office's file format.

Brown confirmed that Corel will provide WordPerfect Office 2002 as an upgrade to existing customers and will target it at the legal market, in particular, where the developer has a loyal following.

Elsewhere, analysts at Comdex predicted strong growth in the sales of non-PC devices, but differed in their interpretation of what technologies would dominate. The general impression is that today's computing hardware market is in a state of flux.

Wireless makes its mark
Analyst company IDC estimates that 140 million PCs are currently shipped annually, alongside 50 million non-PC devices. But Bruce Stephen, group vice-president at Global Personal Systems Research, said: "We have yet to see sustainable business models for new devices."

He was more upbeat about the PC's long-term survival prospects, however, predicting a 20 per cent rise in shipments next year. He believes that before non-PC devices can present a credible, long-term alternative, service partnerships will need to be worked out and form factors for wireless devices agreed upon.

Gerry Purdey, chief executive at Mobile Insights, which undertakes research about the mobile market, said that by 2003, he expects the current PC-to-notebook ratio to have reversed from 80:20 in favour of the PC to 80:20 in favour of notebooks. "Human resource managers are defining notebooks as better suited to new working methods," he claimed.

But others were not so sure. David Blumstein, chief technology officer at US advertising giant and wireless specialist MVBMS, attested: "The ratio is more like 50:50."

From a non-PC perspective, Comdex was swamped with new devices based on either the Palm operating system or the Bluetooth specification. Palm announced the beta version of its Protocol Independent Multicast-centric personal portal for Palm VII handheld users. Scheduled to go live on Christmas day, this allows information to be displayed in a format that fits the Palm device.

The company also announced a new modem for its M100 appliance, and an internet kit that will enable Palm devices to connect wirelessly to the web. This will be available to UK distributors by the end of November. Pricing has not been confirmed, but it costs $340 in the US.

Handspring also attempted to come up with an answer to European criticism that the general availability of applications and add-on devices for its handhelds has lagged in the region compared to the US. Andrew Parker, a senior analyst at Forrester Research, said: "They are great devices, but we need to see the add-ons very quickly now."

As a result, Handspring's pavilion at Comdex was awash with new devices, mostly different types of wired or wireless modems, digital cameras or Global Positioning System tracking devices.

As expected, Sony, on the other hand, demonstrated various concept devices with a strong consumer flavour. A headset for Palm-style devices that could also act as a modem in conjunction with Sony's Memory Stick technology was one example. More than 100 companies now develop Memory Stick-based devices, enabling them to miniaturise devices such as digital cameras, modems and audio players.

For those with a serious addiction to gadgets, Sony also demonstrated Aibo, a robotic dog that gives an entire new meaning to the term K-9 (Doctor Who's erstwhile electronic companion). Astonishingly realistic, and costing between $1500 and $2090 depending on the model, it is the ultimate toy.

Aibo takes pictures and responds to greetings and praise in American English, but does not eat dog food.

And analysts were upbeat about both Sony and Handspring's sales prospects into future, with Mobile Insights' Purdey claiming that the combined sales of their devices would outstrip Palm by 2002. "Sony and Handspring are focused on satisfying the customer. That is the difference between them and Palm," he said.

Undeterred, however, Eastman Kodak unveiled PalmPix, a clip-on digital camera for Palm devices, which will be "available soon" in the UK and cost from $99 to $149 depending on the outlet. Eastman Kodak used the device to transform a smudgy black and white image into a colour picture with a 640 x 480 VGA format.

Pictures taken with the PalmPix are good enough to be used on websites, and for every 100K of memory available on the Palm, the appliance is capable of storing one image. A similar device is available for the M100.

Barking mad ideas
Going back to concept devices, Toshiba had some of its own, including a browsing pad, a wireless, pen-based device for web surfing and entertainment. It has an ultra-thin, slide-out keyboard and a 1.8in hard drive.

The supplier also touted a mobile audio set with an SD slot so it could be used 'on the go', and what it describes as a 'house server'. This supports a range of wired or wireless storage devices, display, broadcast and communications units. Toshiba is likewise developing a 20in LCD screen that folds up into a 14in format, but which is a must for power users in the office.

While Comdex had plenty of such wireless communication products on show, it was almost devoid of Wap offerings, however. Despite the hype in the UK and Europe, the technology is seen as a dead end in the US, largely because it is associated with mobile phones. Phil Wainewright, an independent analyst for the application service provider market, said: "If Wap is so great, how come I don't see anyone using it?"

Blumstein was equally derisory. "I can remember bulletin boards looking better than this," he said.

And Bluetooth has come in for its own share of flak. "Bluetooth has been a great disappointment to date," said Purdey, predicting that by 2002, Bluetooth-enabled devices would replace cable-based appliances at home. The Bluetooth pavilion had a range of offerings on show, but these mostly centred on wireless PCMCIA Lans and printer cards that will be available before the end of the year.

Compact Flash, USB and RS232 dongles are all scheduled to appear by the first half of 2000, but, unfortunately, are expensive: UK Bluetooth developer BrainBoxes quotes $150 to $180 as the price range for most devices. Ian Brew, the firm's sales executive, explained: "It is unfortunate that, at the moment, discussions are ongoing, but Dell, Compaq and others are not quite as committed as we would like."

This will be news to Michael Dell, chief executive at the eponymous vendor, who used his keynote address to affirm that the vendor is "absolutely committed" to wireless technology.

But resellers should be happy that Hewlett Packard (HP) has decided not to go ahead with its acquisition of PricewaterhouseCoopers. In chief executive Carly Fiorina keynote speech, she made scant reference to the decision, which could not have come at a worse time.

HP missed its latest earnings expectations by a considerable margin and this overshadowed what could have been a rallying call to the open standards lobby. The vendor needs to be a lot clearer about its objectives, however: Fiorina is making a huge play to provide e-services, but where this leaves the reseller is anyone's guess.

Oracle's chief executive Larry Ellison, on the other hand, announced a partnership with Compaq to ship Compaq ProLiant DL360 ultra-thin, two-way servers pre-configured and pre-loaded with Oracle software. The Oracle9i Application Server Appliance will be sold through selected Compaq channels, and the same will apply to Sun Microsystems and HP-based systems when they become available.

But neither HP and Sun were able to get their acts together in time to take part in the announcement. "Our original idea was this will appeal to SMEs," said Ellison.

From a reseller perspective, the Appliances present an opportunity to sell into the enterprise applications market, but although Ellison insisted that different configurations had been tested, he did not explain what these different configurations were likely to be.

Unclear horizons
He also kept quiet about how Compaq and HP might be able to comply with Oracle's specifications if demand, and therefore the price of different parts such as memory, I/O and disk arrays, changes. This could mean that boxes based on the same specification have different configurations.

Overall, however, Comdex was good news for resellers, although it is worth pointing out that devices such as Handspring are now starting to move into the retail consumer channel, which is blurring the lines between hobbyists and business users.

But the opportunities to develop new lines of business look good, as devices now appear to be based more on customer need than the result of vendors simply pushing out upgrades for the sake of it.