Hewlett Packard
The iPAQ 600 Series Business Navigator, HP's second cell phone, includes a navigation feature with 3-D maps.
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updated 9/5/2007 9:32:36 PM ET 2007-09-06T01:32:36

Hewlett-Packard Co. unveiled two new cell phones Wednesday, pushing deeper into the lucrative cell phone arena and broadening the array of equipment it can sell to large companies.

The iPAQ 600 Series Business Navigator looks and functions like a cell phone and includes a navigation feature with 3-D maps. It's HP's second cell phone, coming on the heels of the Voice Messenger announced in February.

The company also announced the iPAQ 900 Series Business Messenger, a smart phone with a full keyboard that follows another full-keyboard model introduced last year.

Palo Alto-based HP unveiled the phones at a major launch in New York. Both run on the latest in third-generation, or 3G, high-speed networks. No carriers have been announced yet, but HP said the phones are planned to work with most major carriers.

The new phones are a key part of HP's efforts to expand its iPAQ brand of handheld products beyond PDA devices, which still sell briskly, though their popularity is fading in favor of more phone-like gadgets.

HP, which supplanted Dell Inc. last year as the No. 1 seller of PCs worldwide, is better known for its PCs and extremely profitable printer ink than its handheld devices.

Still, HP is a major player in the PDA world, ranking second behind market-leader Palm Inc. in worldwide PDA sales for the first half of 2007, according to market research firm IDC. More than 22 percent of the 1.6 billion PDAs sold in that period were HP products, according to IDC.

But the rise of smart phones has pressured PDA makers. The success of gadgets like Research In Motion Ltd.'s BlackBerry and Palm's Treo — and now Apple Inc.'s iPhone — is prodding handheld device makers to beef up their offerings in an increasingly Internet-connected world.

PDAs are increasingly seen as companions to cell phones and smart phones instead of the all-in-one device they were once were, said Gene Wang, vice president of marketing for HP's handhelds unit.

"It's less that the PDA business is going away, and more that, especially with the new 3G networks coming out, you can put so many new features and services to work," Wang said. "It really brings the enterprise the productivity they're looking for."

When it comes to smart phones, HP is clearly still the newcomer. Less than one percent of the 53 million smart phones shipped during the first six months of the year were HP products, according to IDC.

Analysts said the company is facing an uphill battle as it fights entrenched competitors in the market of mobile devices sold to businesses.

But it also has deep pockets and tight relationships with customers who for years have relied on HP servers, PCs and services, analysts said.

"They're facing some stiff, stiff competition, and they're also walking a road where there's a lot of charred wreckage," said Crawford Del Prete, an IDC analyst. "But they're also HP and they have a lot of resources to do this."

The two phones were announced Wednesday as HP took the wraps off a slew of products from its Personal Systems Group, the division that brought in $29.2 billion in sales last year and includes consumer and business PCs, plasma and LCD flat-screen televisions and PDAs.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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