Microsoft Gives Hand-Held PCs Another Shot

Even Microsoft Corp. executives admit the company usually needs three versions of a product before it’s done right: The first gets it out the door, the second puts it in the right market, and the third gets all the bugs out.

Welcome to version two of Microsoft’s hand-held PCs--laptop-like devices that are more powerful than personal organizers but weaker and lighter than full-size laptop computers.

Microsoft said Wednesday that it would try again with these hybrid devices, introducing the Handheld PC 2000. And in an uncharacteristic mea culpa, the company said it would get the market right this time.

“We’ve learned a lot,” said Doug Dedo, marketing manager for the new devices. “Some of the approaches we took were not appropriate for this device.”

Microsoft’s Handheld PCs first came out in November 1998, aimed at mobile business users and students who didn’t need a lot of power but still craved something bigger than a pocket computer. They had nearly full-size screens and keyboards, along with modems for Internet access, but weaker processors and no hard drive storage.

These first products, named Jupiter-class devices after the Microsoft project code word, flopped in most areas, especially as personal organizers such as the Palm III and ultra-slim full-fledged laptops such as the Sony Vaio became popular. The Jupiter products’ high price, $800 to $1,000, was also a consumer turnoff.

Microsoft found, however, that the Jupiter products were popular in limited applications, such as in the medical field for patient charts.

Thus, the Handheld PC 2000 devices, to be manufactured by Hewlett-Packard Co., NEC Computers and Sharp Electronics Corp., will be marketed to businesses that need flexible, Internet-connected devices but don’t want the cost and fragility of full-size laptops.

“I think that Microsoft has come to the realization that they need a platform in this space, but that it won’t be broadly accepted,” said Jack Gold, an analyst with Meta Group Inc., a technology think tank.

The Handheld PC 2000 will come with “Pocket” versions of Microsoft Word and the Excel spreadsheet program, as well as a truncated version of the Internet Explorer Web browser.