Big Computer-Makers Catch iPhone Fever - InformationWeek

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Big Computer-Makers Catch iPhone Fever

Handset makers including Nokia, Motorola, and Research In Motion announced new smartphones this week, hoping to capitalize on the "halo effect" of increased customer interest driven by the iPhone introduction.

For months before the launch of the iPhone, rival handset makers talked about the "halo effect" the hotly anticipated device would have: The sleek new device from Apple would generate new innovation in the rapidly expanding smartphone market, and new attention from consumers and businesses.

That has clearly happened, with innovative and feature-packed new devices pouring from the big handset makers including Nokia, Motorola, Sony Ericsson, Samsung and HTC. Research in Motion this week announced its new BlackBerry 8820, which like the iPhone operates over both Wi-Fi and cellular networks. The first dual-mode BlackBerry, the 8820 is clearly a response to the overwhelming popularity of the multimedia, dual-mode iPhone.

Also catching iPhone fever are the big laptop makers, who are seeing their core businesses flatten out while sales of smartphones continue to boom. Both Hewlett Packard and Dell recently announced they are making major strategic thrusts into the smartphone business.

Dell is now offering E and N series mobile devices from Nokia, the world's No. 1 handset maker, via its small-business Web site. Sold unlocked " i.e., not tied to a specific carrier " the Nokia N95 and N80 are high-end multimedia consumer devices while the E series (the E61 and E61i) are targeted at enterprises. All Wi-Fi-enabled, they are unsubsidized by carriers and thus pricey: the N95, for example, retails for around $750. They run over GSM cellular networks, meaning that they can be used with T-Mobile and AT&T in the U.S.

The link-up with Nokia is actually a return to the mobile-device market for Dell after the shutdown of its ill-conceived Axim line of pocket PCs earlier this year. First launched in 2002, the Axim series included the X3i, the first Windows Mobile-based device with an integrated wireless connection that retailed for under $400. The devices never caught on with consumers, however, and in April Dell said it would stop manufacturing the devices.

Dell has also been rumored to be building its own smartphone, possibly in partnership with Quanta Computer. And the February arrival of former Motorola executive Ron Garriques -- who is considered largely responsible for the runaway success of Motorola's Razr -- to head Dell's consumer group has bolstered expectations that Dell will move strongly into mobile devices this year.

Dell's moves, says Carmi Levy, senior vice president for strategic consulting at AR Communications Inc., confirms that the smartphone market continues to boil with competition and innovation.

"Any time a tier-A vendor gets into a market it legitimizes the market," says Levy."Dell re-entering sends a signal that this is the place you want to be if you want to grow your hardware and services business."

HP, of course, has been in the mobile-device business for some time with its iPaq line of pocket PCs and handhelds. On Tuesday the computer and printer maker said its iPaq 510 Voice Messenger, the first of the line built on Windows Mobile 6, has been shipping since June. L:ike the Nokia devices, the iPaq is sold unlocked, and it's not cheap, retailing at an unsubsidized price of $320. It runs over GSM networks as well as Wi-Fi. And it's not available at your local Best Buy: HP has consciously chosen an enterprise-focused sales strategy, offering the devices either directly to enterprise customers or via resellers and integrators. It's not hard to imagine a company like Hewlett Packard, with its strong record of selling laptops to consumers, will at some point challenge the iPhone on its turf as well, though.

More than any other computer vendor, HP has invested significant engineering R&D and marketing to bring an entire range of mobile products to market," says Levy. "It wouldn't surprise me if Dell was looking to HP and saying 'We need to be there too.'"

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