Compaq is working on a Windows CE-based palm PC due for release this quarter, according to sources close to the company cited on US newswires. Codenamed Wyvern, the new device is Compaq's second attempt at producing a Windows CE machine. The previous device was a standard clamshell palmtop -- Wyvern, on the other hand, will be more akin to Palm's Palm series and Philips Nino. The stylus-operated device is said to sport a colour display and feature a series of buttons which launch specific applications. In a move that imitates Palm Computing's current strategy, Compaq will license Wyvern to other vendors. The company has already signed up Hewlett-Packard, which demoed a Wyvern-based device at the Las Vegas Consumer Electronics Show earlier this month. A hardware licensing programme could be just what the Windows CE platform needs to begin making real headway in its ongoing race with Palm Computing's PalmOS platform. The availability of a ready-to-badge hardware might just tempt vendors previously shy of entering the palmtop market because the cost of developing a system from scratch given the potential low level of sales. That said, it doesn't appear that great queues vendors are forming up to buy into the Palm approach either, so Compaq may have problems finding supporters. Even Apple only managed to find a handful of licensees for its now-defunct Newton. ® See also 3Com readies Palm IIIx two months before Palm V is duePalm at fives and sevens over release schedule 3Com unveils wireless-equipped Palm VII Palm delays release of next-generation handheld