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Compaq OEM out of palm-sized market

Insider says it was never really in

Everex Systems Inc, an affiliate of Taiwan's First International Computer (FIC), has dropped out of the market for palm-sized PCs, say US sources. The company's decision is attributed to component supply problems and poor sales. However a source close to the project claims Everex never firmly committed itself to the palm-sized plan. The move comes as other firms are strongly promoting similar products at the annual Comdex exhibition in Las Vegas, Nevada. Ironically, mobile computing devices with communications capabilities - a category which includes Everex's product - are seen as one of the hot items at the show. Everex representatives in the US said demand for the company's Freestyle series of palm-sized PCs has been poor. The company's palm-sized PCs are based on specifications developed by Microsoft and run the US software giant's Windows CE operating system. Everex has also had problems recently with a shortage of color LCD screens for its newest model, the Freestyle 540. A former FIC employee, who worked closely with the team that developed the Freestyle series, said the company's senior executives had never intended it to be a viable own-brand product. Instead, he said the primary goal was to secure OEM (original equipment manufacturer) orders from foreign companies. The employee suggested overseas companies would be more interested in the product, and more confident in its quality, if they saw Everex devoting resources to marketing its own version. In fact, Everex was successful in attracting a large order from Compaq and makes the Aero range of palm-sized PCs for the US computer giant. Meanwhile, at news.com, a story suggests that Compaq's commitment to Win CE handhelds may also be wavering. Instead, the story says, the systems vendor may switch to the Palm OS. Company officials could not be reached for comment. Staff at LEO Systems, which handles manufacturing for Everex and sells its own version of the product in Asia, said they were unable to comment. Leo, Everex and FIC are all members of Taiwan's Formosa Plastics Group. LEO launched its own Chinese-language version of the colour Freestyle last month for sale in Asia. It is not yet clear whether this product will also be cancelled. ®

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