Palm's move to Windows for Treo clouds Palm OS future

Palm's announcement last week of a Treo smart phone that will run Windows Mobile provoked a debate among IT managers over whether Microsoft's operating system or Palm OS is the better choice for users.

But 10 IT managers interviewed after the announcement agreed on one thing: They would prefer to deploy a single mobile operating system to help simplify support.

"Fundamentally, I'm not a Microsoft hater, and I might want Windows Mobile in five years," said Bruce Hagen, vice president of corporate information systems at Bemis Manufacturing. "[But] we want to have one OS to support. There are too many support issues with one, let alone [two]."

About 50 end users at Bemis use Treo 650s running Palm OS to access the company's Exchange e-mail server and place voice calls through Good Technology's GoodLink service. Hagen explained that GoodLink gives him all the functions Microsoft and Palm are promising in the Windows-based device. And he said he doesn't expect Palm to back away from Palm OS.

But Drew Mazeitis, manager of mobility at Ferrellgas Partners, a nationwide propane retailer said that Palm's market share has been "eroding quickly." With this week's news, he said, "every day we are closer to the reality that [Palm OS is] dead."

Ferrellgas uses Windows Mobile to power 4,000 custom handhelds used by propane service workers and about 50 Samsung flip phones for the company's executives.

"As much as you hate to feed the Microsoft machine, they continue to improve their products and integrate things and make it hard for you to not use their stuff," Mazeitis said.

Sunnyvale, Calif.-based Palm said the new Treo will be available in the U.S. early next year and will initially work on Verizon Wireless' cellular network. The use of Windows Mobile 5.0 will let users hook their Treos into Exchange servers and deploy applications written for Windows on the phones, according to company officials.

Following the announcement, Gartner Inc. issued a report recommending that corporate users "make no further investments in Palm OS Treos for enterprise applications." The new device will enable Palm to compete more effectively against Research In Motion's BlackBerry and the growing number of handhelds based on Windows Mobile 5.0, Gartner said in the report.

Palm OS is developed by PalmSource, a separate company that last month agreed to be acquired by Tokyo-based Access Co.

Gartner analyst Todd Kort said the latest version of the software, called Palm OS Cobalt, has been "a fiasco" since its release last year. Cobalt hasn't been adopted by major Palm licensees because it "requires a fantastic amount of memory" to run properly, Kort said.

Ed Colligan, Palm's president and CEO, didn't directly address the future of Palm OS within the hardware vendor's devices during a news conference. But he called the support for Windows Mobile "an expansion" of Palm's product line. "This is not about other things going away," he said. "This is about growth."

A spokeswoman for Palm noted afterward that some corporate users have told the vendor that they wouldn't consider using Palm's hardware "unless it ran Windows."

Jeff Robles, sourcing manager at Best Buy Co. said he questions whether the market will support a large shift in device operating systems unless a company finds the return on investment is warranted. While Robles welcomed more devices to access Exchange, he said multiple device operating systems "make it harder to migrate."

Dale Frantz, CIO at Auto Warehousing Co., currently supports 30 Treo 650s that run Palm OS and are used by executives at the new-car processor. But Frantz said he will "immediately" transition to the Windows Mobile device when it becomes available.

A feature for pushing e-mail over the Verizon Wireless network to the existing Treos requires a user's PC and Outlook client to remain on, Frantz said, describing that approach as "extremely unreliable." Because his staff has spent many hours trying to address the problem, converting to Windows-based Treos "would very quickly reduce PC tech-support costs," he said.

-- Tom Krazit of the IDG News Service contributed to this story.

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