Students of automotive history know that there was a time when there were dozens of companies manufacturing vehicles. Today, there are just a handful left, the result of, to some extent, economic Darwinism, and to a much greater extent, mergers and acquisitions. The likes of Cord, Packard, Studebaker, Rambler, or American Motors are long gone, and what remained was the "Big Three" (General Motors, Ford, and Chrysler). Now, with no one else left within national boundaries, consolidation continues on an international level. GM and Ford are on the prowl, snapping up, or buying into, the likes of Fiat, Jaguar, Mazda, Volvo, Saab, and Mitsubishi. The smallest of the Big Three, Chrysler, found itself on the receiving end of a merger and was essentially swallowed by the German Daimler corporation.

Though attracting nowhere near as much public coverage and attention, the same thing is happening in the vertical market computing arena. A few years ago, the Big Three of industrial computing terminals and solutionsÑSymbol, Norand, and TelxonÑreigned supreme and anchored every major trade show with their pavilions displaying the latest in no-nonsense, practical solutions for real world field force automation applications.

Today, of those three companies, only Symbol Technologies remains as an independent entity. Norand was bought by Intermec, itself a business segment of integrated systems solutions giant UNOVA. And Telxon, after a couple of difficult years where the company tried to reinvent itself, was acquired by Symbol Technologies on July 26, 2000. As stated above, none of these moves attract much coverage beyond perhaps a small feature in the business section of the Wall Street Journal. That's partially because industrial terminals and integrated systems solutions aren't as sexy as iMacs, and partially because, even after all those mergers and acquisitions, the remaining players are not very large by Fortune 100 standards. UNOVA and the newly formed Symbol/Telxon combined have projected 2000 sales of just under US$4 billion, about half of what Apple, the underdog of personal computing, will have this year. Listening in on the conference call announcement of the takeover was interesting. Symbol chairman Jerome Swartz called it a "friendly stock merger," a "superb opportunity," and mentioned how well Telxon's "complementary products and technologies" will fit into Symbol's future. Telxon chairman CEO John W. Paxton stated that "giving up our independent existence was obviously a difficult decision" and that Telxon had been on the right track to be a financially viable independent company. The actual financials, however, spoke volumes: Symbol announced a record quarter of US$341 million in sales and US$36 million in profit. Telxon had flat revenue of US$86 million and, despite a high order backlog and the recent purchase of Kinetic's PC/Rover product line, a loss of over ten million.

What drives this sort of drastic consolidation? Primarily economies of scale. It is enormously difficult for the makers of industrial computers to remain in business. Rapid progress in computing technology renders their products obsolete before they even reach customers. The sales cycle is long and costly, often taking years from first contact to deployment of actual product. Also, you don't buy systems solutions at CompUSA. Successfully providing them requires a carefully built and nurtured network of VARs (Value Added Resellers), ISVs (Independent Software Vendors), and OEMs (Original Equipment Manufacturers) in addition to the primary vendors' own internal business development facilities.

Almost every vendor of pen computing technology has run into this problem. The result is consolidation at every level. If you peruse the Buyer's Guide section of an older issue of Pen Computing Magazine, you will find a good number of companies who have since either disappeared, merged with others, or been swallowed by others. Digital Ocean is gone, Badger was bought out, as were Teklogix and Ramline. Husky was acquired by Itronix and Fujitsu Personal Systems merged into the Fujitsu PC Company. Kalidor, TelePad, M3I, and Cruise Technologies are gone. IBM, Toshiba, Ricoh, TexasMicro pulled out, and it looks like Mitsubishi will, too. Others have sort of faded from the scene, redirecting their efforts into other fields. Examples are Dauphin, Vadem, Sharp, and Motorola.

This is not to say that dedicated, well focused companies cannot flourish in the vertical pen market, even if they are not very large. WalkAbout does very well with its hardened Hammerhead pen slates. Xplore has just landed a big contract thanks to its acquisition of Ramline. And there are several other smaller manufacturers who do quite well.

To me, there is another component to this consolidation, and that's the increasing proliferation and importance of inexpensive, standardized, and more or less generic handheld technology. When I attended Symbol's second annual Software Developers Conference in June (see report on page 38 of this issue) I expected a lot of dry sessions on legacy technology. Instead, the entire conference centered was totally future-oriented, centering around handhelds powered by Windows and the Palm OS, enterprise integration, wireless, and the Web. Symbol has clearly seen the light and is gearing up for a future where small, inexpensive handhelds and palmtops will be deployed by the hundreds of thousands, and even millions.

This trend towards using industry standard handhelds in vertical markets has actually been going on for a couple of years now. Virtually every player in the vertical market systems solutions field has at least investigated the idea of designing handhelds that are smaller, lighter, less complex, less vulnerable, and less expensive than traditional, full-function Windows clamshell or pen tablet computers. While not all of the early efforts were successful, I think that was less because of the design and quality of the devices and more because of Microsoft's painful struggles with Windows CE. Continuity and stability are of utmost importance in markets where the lifespan of equipment is measured in terms of several years instead of just 12 to 24 months. In addition, designing a new relatively low volume product, and keeping it updated, is tough enough for big companies. For the little guys it may be close to suicide to bet the farm on Microsoft just to find that the winds of mobile technology up in Redmond have changed yet again.

This, by the way, may well be the reason why the Palm OS is making surprising inroads into the vertical and enterprise markets. The Palm platform is a veritable rock of stability compared to almost everything else out there. Last year's Wintel and WinRISC processors are old hat and usually don't stand a chance of even making it past the first round of an RFP (Request for Proposal) process, the almighty roadblock to getting corporate sales. Palms, on the other hand, started out with a wheezy 16MHz processor that had been obsolete for years even when the first Pilot was introduced. Four years later all Palms still use that processor and the only change is that some use a variant that can run at 20MHz instead of 16. Palm software hasn't changed and no one has ever complained that his or her Palm isn't fast enough, or that battery life is poor, or that the thing costs too much. There's a lesson there, and one that the competition better learns quickly.

At the Symbol Conference, for example, Palm came across as the leader and aggressor while Microsoft seemed on the defensive, despite the fact that Symbol has dozens of Windows-powered devices and only two that use the Palm OS (the SPT 1500 and 1700/1740).

As you peruse this issue of Pen Computing Magazine you'll see that the Palm/Microsoft battle is in full force. We have collected what are probably the most complete comparison tables of all current Pocket PC (page 56) and Palm OS (page 80) devices. Each table contains not only all pertinent specifications, but also performance benchmarks. On the Pocket PC side, BSQUARE's release of a Pocket PC compatible version of its bUSEFUL Analyzer confirmed what we already knew from hands-on use: the Compaq iPAQ is the fastest Pocket PC, and also the overall fastest Windows CE device we've ever tested.

In this issue you also find detailed reviews of three newcomers to the Pocket PC camp. Casio's "multimedia" EM-500 and the ruggedized EG-80/800 offer excellent performance and functionality tailor-made for their respective purposes.

In the Palm OS section you'll find a detailed look at the all-new Palm m100, a device that Palm editor Shawn Barnett calls "a new device for new markets." You'll also find a first glance at the Palm VIIx and a guide to all available and announced Springboard modules for the Handspring Visor, 38 in all.

Conrad H. Blickenstorfer is editor-in-chief of Pen Computing Magazine and general editor of Digital Camera Magazine. He can be reached via e-mail at chb@pencomputing.com.