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Handspring brightens line
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October 16, 2000: 3:23 p.m. ET
Handspring adds color, high-speed monochrome versions to line
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NEW YORK (CNNfn) - The battle for market share between Handspring Inc. and Palm intensified Monday as Handspring unveiled two new personal digital assistants, called Visor Prism and Visor Platinum.
The Visor Prism is Handspring's first handheld computer with a color screen.
Palm, which controls about 70 percent of the personal digital assistant market, has had a color model, called the Palm IIIc, on the market since last February.
Handspring (HAND: Research, Estimates) said that its Visor Platinum is the fastest handheld computer on the market today that uses the Palm operating system. It's at least 50 percent faster than Handspring's Visor Deluxe and as much as twice as fast as many other Palm operating system products, Handspring said.
Handspring stock jumped $4.81 to $76.75 in midafternoon trading Monday, while Palm (PALM: Research, Estimates) gained 81 cents to $54.
"We believe these new offerings further enhance Handspring's existing product portfolio by expanding its range into the high end handheld segment," said CS First Boston analyst Marc Cabi in a research note. "We believe this wider product range will allow Handspring to gain market share going forward."
Handspring's new color model can display over 65,000 colors for viewing picture-quality graphics, as well as games and maps. By contrast, the Palm IIIc can handle 256 colors, giving it lower resolution and less realistic image quality than the Handspring. The Palm IIIc was introduced at a price of $449 and has since dropped to $399. Handspring has priced the Visor Prism at $449.
Palm's IIIc has been less popular among business users than its Palm V series, which have monochrome screens but are much slimmer than the IIIc. Handspring spokesman Brian Jaquet said that Handspring is aiming its color model at consumers, rather than business users. The company hopes to make color screens more popular with consumers through its add-on modules, such as digital cameras, global positioning systems, modems, Web browsers and games.
Handspring's new Visor Platinum has a monochrome screen and is designed for users who require increased speed and performance from their handheld computer. In addition to being the fastest handheld based on the Palm operating system, the Visor Platinum features wireless infrared synchronization with desktop computers and enhanced security. The Platinum model runs on two AAA batteries that last for four to six weeks with standard use.
Handspring last month introduced the VisorPhone, an expansion module that enables any Visor handheld computer to make and receive phone calls. On the same day that Handspring announced its VisorPhone, Palm said that it was teaming with Motorola to create a "new smart phone that blends the functionality of a Palm handheld computer with the simplicity and compact form factor of today's mobile phone."
Handspring is scheduled to release its fiscal year 2001 first-quarter earnings after the markets close Tuesday. While Palm is profitable, CS First Boston's Cabi estimates that Handspring will lose 34 cents per share in fiscal 2001, after losing 63 cents per share in 2000. The mean analyst estimate for Handspring's first quarter is a loss of 13 cents per share, according to First Call. 
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