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Bsquare axes WinXP GSM handheld

Sold too few, cost too much

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Bsquare is to drop its Power Handheld (PH) Windows XP-based wireless PDA. The company will instead offer the device's design to other vendors under licence and sell them the application and utility software it had developed for the device.

The company made the announcement just before posting a quarterly net loss of $5.1, $4.5m of which resulted from the decision to end PH manufacturing and marketing, through asset impairment and the cost of laying off the PH operation's workers.

Bsquare achieved revenues of $8.8m for the quarter, the company's second, compared to $9.4m in Q2 2003 and $10.6m in Q1 2004.

The company also it had paid $310,000 to settle a royalty payments dispute with Microsoft, and that too may have had an influence on Bsquare's decision to stop producing the PH.

Bsquare Power HandheldAs we noted in our review of the product, the PH is an innovative revival of the late 1980s handheld PC as a modern GSM/GPRS-enabled communications tool. The unit sports a high-quality 640 x 480 display and runs the embedded version of Windows XP. It was powered by a 400MHz Intel XScale CPU with 128MB of RAM.

"We sold a relatively small number of units and the ongoing investment didn't make sense at the expense of our core business," Bsquare CEO Brian Crowley admitted. Some of the devices were sold to UK mobile phone network Vodafone. PH was one of a range of wireless data-oriented devices the operator offers.

Essentially, Bsquare suffered the fate that overcomes many hardware start-ups - it simply couldn't sell enough units to cover the ongoing development and manufacturing costs and to deliver lower end-user pricing over time. It's a shame - the PH has its flaws, but it remains a solid alternative to too-small PDAs and too-large notebooks.

The demise of the PH leaves the handheld PC leaves the market open to the likes of Tiqit, OQO and FlipStart. HP too is said to be pondering a return to the handheld PC market. ®

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