Handspring to develop smartphones for Orange

Good deal

Handspring, the USA PDA maker, is to develop smartphones for Orange. The idea is to make handsets which will tie "seamlessly into Orange back-end network systems to make wireless data applications easy to use right out of the box".

Orange was, of course, the world's first network operator to tout a smartphone using MS software, the SPV, so it has experience of introducing niche handset OSes into Europe.

The deal looks sweet - potentially - for Handspring, which is not big in Europe. Its Treo PDA-cum-phones are currently offered solely by mmO2. Even though smartphones sell right now in comparatively low numbers, they will soon outstrip PDA volumes. And Orange has massive distribution muscle, especially in France and the UK.

We guess that Orange will own-brand any Handspring product that comes out of this agreement. The gig, after all, matters a helluva lot more to Handspring, which is running on empty, so far as cash is concerned. And if things go well here, Handspring could carve out a future as a pliant contract designer/manufacturer for the big networks. ®

Bootnote

Handspring reported deepening losses on declining sales when it posted its Q3 results yesterday. Sales for the three months to 29 March totalled $30.8 million, well down on the year-ago quarter's $59.7 million.

Handspring lost $90.4 million ($0.62 a share) during the quarter - in Q3 2002 it lost $23.6 million ($0.18 a share). The loss was largely due to a $75.9 million restructuring charge and $1.7 million for amortisation of deferred stock compensation. Operationally, it lost $12.8 million.

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