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Palm mobilises for invasion of China

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Palm is mobilising its forces to pursue a strategy of regime change in the Chinese PDA market in a bid to take command of the largest handheld arena in Asia Pacific.

Its initial challenge is the logistics of the campaign. SARS notwithstanding, the PDA maker has established a forward distribution centre in Hong Kong. Local partners have rallied to its cause, with Kerry Logistics in particular setting up the distribution base on Palm's behalf.

Palm said it will also form a strategic network of distributor and enterprise partners throughout the region. Local distie Digital China has allied itself to the Palm offensive. According to market researcher IDC, Digital China is the largest IT distie and systems integrator in China. It will target retailers and enterprise customers.

To encourage Chinese consumers to come out and support the campaign, Palm said it will set up free-phone local technical support and service. A repair centre will be put in place in Suzhou, served by "newly established drop zones in Beijing, Shanghai and Guangzhou".

Palm plans to deploy its arsenal of Tungsten T and Zire devices, along with controversial older ordnance like the m500. Each will be available in Traditional and Simplified Chinese, and English, and the devices will use PenPower handwriting software for Chinese character recognition.

Palm has been a long time coming to China, which accounts for nearly 70 per cent of the Asia Pacific PDA business, according to IDC. And with sales growth forecasts in the order of 14 per cent year-on-year - the reverse of declining Western handheld markets - Palm's overseas adventures will undoubtedly be seen as being motivated by a desire to distract shareholder attention from domestic failings.

The move may also come under criticism from Palm's allies in the region, including Samsung and Acer, which have for some time sought to promote Palm technology in China and the Far East. The action will further highlight the split at Palm between those who would seek to expand its influence through the licensing of its core technology, and those who prefer the more direct approach of selling product. ®

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