PDAS TAKE ON COMMUNICATIONS

DEVICES NOW LOOK TO BECOME AS COMMON AS CELLULAR PHONES

By Published on .

Most Popular
The personal digital assistant is struggling to overcome initial setbacks. And industry visionaries still boast of a bright future for the PDA-type devices, once potential buyers know their myriad possibilities.

Spreading the word about what the next generation of PDAs can do -- and making consumers forget problems with the first PDAs -- lies at the heart of the challenge for marketers. Unlike the first PDAs, the new crop of devices is used for communications and not personal computing.

"Ten years from now, you won't see a personal digital assistant that doesn't have wireless in it," predicts Jeff Morris, VP-marketing services for Motorola's Wireless Data Group.

Apple Computer, widely credited with founding the PDA market, also gave the nascent business a black eye when it introduced the Newton MessagePad a year ago.

The company's pledges of handwriting recognition and two-way wireless communications went unfulfilled. And instead of ushering in a new era of electronic gadgets, Newton was lampooned by comedians and cartoonists.

First-year sales totaled less than 90,000 and fell short of analysts' sales projections.

Another PDA company, Eo Inc., folded last summer after selling only 10,000 units.

"The hype promised far more than the technology and engineering were able to deliver," says Mike McGuire, industry analyst at researcher Dataquest. "Essentially, [the early devices] were $800 replacements for $35 worth of paper."

Today, leading marketers appear willing to nurture long-term sales of PDAs, which usually sell from $600 to $1,500. Perhaps more importantly, most companies have retreated from offering full-blown handwriting recognition and instead are emphasizing communications abilities.

BellSouth Cellular's Simon handles electronic mail, faxes and regular calls over BellSouth's cellular network through a keypad and icon-driven menus. Sony Corp. of America has its Magic Link, which communicates primarily over regular phone lines but also can use an insertable paging card to connect with a private paging service. Motorola's Envoy should be available early next year and will have two-way wireless data capability over another private communications network.

"I don't believe [handwriting recognition] is a necessary capability" says Bill Ablondi, VP-mobile and personal computing markets at BIS Strategic Decisions, a market researcher. "What is more important is the clever integration of communications services that provide universal coverage."

This change in function has brought about a switch in the PDA target audience. Instead of being seen as a device that eventually would have mass-market potential, the new PDAs will be pitched to mobile professionals and people involved in businesses such as field services and medical services.

"The paradigm is that you wouldn't use [the Envoy] to create a big spreadsheet but you would use it to carry the spreadsheet around, look at it, update it and send changes back," Mr. Morris says.

To teach consumers about this paradigm and other product features, marketers are turning to public relations and retailer programs, with some advertising added.

"I think one of the things you're going to see from us next year is a pretty comprehensive seminar program, just going around spreading the good news," Mr. Morris says. PR work is being handled by Cunningham Communications, Boston.

Envoy advertising, from Bayer Bess Vanderwarker, Chicago, will be limited to vertical trade publications, such as those covering field services. Because of a limited budget, no national advertising is planned, Mr. Morris says.

"The challenge is to educate potential users that the [wireless communications] technology exists even before we get down to specific products," he says.

Sony is riding the recent publicity for its Magic Link. A database search found 29 mentions of the Magic Link in major U.S. newspapers since its late September introduction. Technology Solutions, New York, handles PR.

Sony is slated to break a series of print ads next month in business, in-flight and computer magazines. The campaign, created by Leo Burnett Co., Chicago, will convey Magic Link's "engaging, easy-to-use, intelligent messaging" capabilities, says Brian Sroub, VP-sales and marketing for Sony's Personal Information division.

The marketer will also start a direct-mail campaign this month. Names will be taken initially from AT&T Corp.'s customer database, using parameters such as households with two phone numbers and individuals who make many calls across time zones, Mr. Sroub says.

But the marketer also has taken the novel approach of starting a round-the-clock Magic Link forum on America Online, providing product information and message bulletin boards.

"In the first week, without any publicity for the forum itself, more than 500 people accessed it," says David Yaun, Sony's manager of corporate communications.

Sony expects the majority of Magic Link's first-year sales to come from retail channels and not direct corporate sales, he says. About 1,500 electronics retailers, such as Circuit City and The Wiz, will carry Magic Link by the end of the year.

BellSouth, meanwhile, is supplying a video and manuals to retailers of Simon, which combines a cellular telephone, wireless fax machine, electronic mail, pager and organizer, says Rich Guidotti, project manager for Simon.

Advertising is handled on a market-by-market basis. Local BellSouth Cellular market managers set media and budgets for the ads, created in-house. These ads introduce the device and list its features.

Some observers believe existing retailers may not be able to provide the necessary buyer education for PDAs.

Mr. Ablondi says the new PDAs require a different breed of retail store, such as Newton Source in New York City and Totally Wireless in San Jose, Calif.-stores that know about wireless products and can properly educate consumers about them.

Another company, Wireless Telecom, is distributing complete wireless data solutions to computer and communications resellers.

Regardless of how much interest these marketing plans generate, many analysts believe the future of these PDAs is intimately tied to the Federal Communications Commission licensing new wireless networks by late next year.

"These devices just aren't that interesting until they get wirelessly connected-and two-way wireless, not just one way," says Kimball Brown, VP-mobile computing at Dataquest. In the future, he says, these PDAs will likely be bundled with services, much as cellular telephones are sold today.

In this article: