CES: Smartphones To Take Center Stage

Google's Android, Palm's Nova, and touch-screen smartphones are expected to dominate the mobile side of the consumer electronics trade show.
Palm is also hoping CES can help it re-establish itself as a significant player in the smartphone market, as the company will unveil its next-generation OS "Nova." Rumors say the company will be launching the OS on a touch-screen smartphone with a slide-out keyboard, and it will have media, e-mail, calendaring, and mobile Internet capabilities.

While the specifics of Nova and the hardware it will run on aren't clear, industry watchers are certain Palm needs to hit a home run with this release to get back into significance. Once the king of the U.S. smartphone and PDA market, the company has posted six consecutive losses, and it's rapidly losing market share to Research In Motion and Apple.

"They really have their work cut out," said Golvin. "They need a device that is not simply 'me too.' They need to do something that goes beyond what the industry leaders are already doing, and that's a very tall order."

The company did get a recent $100 million equity investment from Elevation Partners, and the private equity firm said Palm is in a "position to transform the cell phone industry" with Nova. Golvin said Palm needs to leverage its rich stable of applications and developers into an easy-to-use store like Apple's App Store. The smartphone maker did launch a Software Store for current devices, but it's a browser-based application that is not as seamless or smooth as the App Store or Google's Android Market.

Palm said it is aiming for the "fat middle" of the market between the media-centric iPhone 3G and the enterprise-focused BlackBerry. But Palm may find that middle isn't quite that fat as RIM continues to target the casual market with devices like the BlackBerry Pearl, Flip and Storm, and iPhone continues to find its way into more businesses.

Even though Apple will not be in attendance, the iPhone 3G's influence will be found at CES, Golvin said. Although Apple wasn't the first it, the iPhone has made touch screens popular, and there should be plenty of touch-screen iPhone competitors on display. Additionally, application developers are bound to show off their new mobile programs to take advantage of the popularity of the App Store.

Microsoft may announce the Windows Mobile 6.5 update during CEO Steve Ballmer's keynote address, but most expect to see a few new smartphones. Symbian and BlackBerry will also have their place at the show, but no major announcements are expected.