Palm, Inc. via Business Wire
Palm hopes to boost its European presence with the new Treo 750v smartphone.
updated 9/12/2006 1:00:59 PM ET 2006-09-12T17:00:59

In its biggest global push yet, Palm Inc. on Tuesday unveiled a new Treo smartphone for Europeans.

The Treo 750v, based on Microsoft Corp.'s Windows Mobile 5.0 operating system, will be first available through Vodafone Group PLC, Europe's largest mobile phone operator.

The new smartphone, part of a growing breed of advanced cell phones that combine voice and data features, will be available in Austria, France, Germany, Ireland, Italy, Netherlands, Spain, Switzerland, the United Kingdom and other regions by the end of the year, Palm said.

The 750v will be the first Treo to use Vodafone's advanced high-speed 3G/UMTS network. Other features include: the absence of an exterior antenna, a satin-like finish and software that simplifies text-messaging.

The new phone is a key part of Palm's future growth. The Sunnyvale-based company pioneered the market for personal digital assistants — and still shipped about 2.5 million PDAs in fiscal 2006 — but it has been focusing more in the fast-growing market of smartphones. The Treo line grew to account for 75 percent of Palm's revenue in its fiscal 2006.

Treos have attracted a large base of business customers, primarily in the United States, but the sleek gadget has only had a "minute presence" in Europe, where Research in Motion Ltd.'s BlackBerry devices are popular and Taiwan's High Tech Computer Corp. has gained traction with its Windows-based smartphones, said Lars Vestergaard, a research director of wireless communication in Western Europe for IDC.

Larger, deep-rocketed rivals, such as Motorola Inc. and Nokia Corp. are also entering the arena, stiffening the competition.

"Now they've extended their life in this European market," said Vestergaard.

Nick Mcquire, an analyst with The Yankee Group, said the 750v — coupled with Vodafone's broad reach of potential customers — will pose a "good challenge" to the incumbent providers.

Palm officials say the new Treo underscores its commitment to serve Europe, which Palm expects will account for 43 percent of the worldwide smartphone market by 2009.

"This is a huge market potential and we haven't been playing there (in Europe) because we didn't have the right product," said Page Murray, Palm's vice president of marketing. "So we've built this product from the ground up for them."

Palm, along with its partners Microsoft and Vodafone, are also each spending "tens of millions of dollars" to market the 750v, representing Palm's largest product launch ever, Murray said.

Still, Palm has its work cut out.

"How Palm makes itself the prettiest girl at the dance at Vodafone is going to be a challenge," Vestergaard said, citing how Vodafone already sells BlackBerries in Europe.

Last week, when Palm warned Wall Street that slow sales of Treos will mean revenue for its fiscal first quarter would fall short of earlier targets, the company said Palm had two products in the pipeline it hopes will help boost sales again.

The 750v is one of them. The other will be a more affordable model for consumers due to be released later this year.

Palm did not disclose a price for the 750v. Prices will be determined by Vodafone and could vary, based on location, Palm said.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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