Sony's departure from the global handheld market comes as no surprise, but Larry Garfield still mourns their passing and wonders what it means for the long-term industry.
Earlier this week, Sony announced that it was getting out of the world handheld market and focusing just on its home town of Japan, where its Palm OS-based CLIE line is still going strong. In fact, it's the only place where the once-lauded CLIE line is going strong, for a variety of reasons. Whatever the reasons, however, Sony's exit is part of a larger picture, one that should have even platform-agnostic users very worried.
Sony first entered the handheld market with the CLIE PEG-S300 in 2001, and in the past three years has released no less than 27 models. From day one, Sony's stated focus was Sony's home turf; flash-dazzle multimedia. For a long time, the CLIE was the multimedia handheld, not just for Palm OS but overall, with integrated cameras, video players, and more eye-candy than even Microsoft. That was also its downfall. In its (successful) drive to push the mobile multimedia envelope, Sony completely ignored the business market during an economic slump. That meant that as business purchases pick up again, and bleed into end-user sales as they always do, Sony is left out in the cold with the still luke-warm "consumer" market while most other device makers remembered the first rule of money: Diversify.
Its other mistake was typically Sony. The only non-proprietary element of the CLIE line was that it used Palm OS. Everything else, from its API extensions to its serial connectors to its Memory Stick slot, was Sony-unique, and it kept changing its product line so quickly that 3rd party accessory makers couldn't keep up, even when they did have interest. The "Palm Economy" that palmOne and PalmSource like to talk about never materialized for the CLIE line. After so many failures in this area before, it's unfortunate that Sony still hasn't learned its lesson: Proprietary bites, but 3rd party support can keep you alive during the worst times.
Unfortunately, the fall of the once 2nd largest handheld maker (behind Palm/palmOne, who is still matched only by phone-maker Nokia) bodes ill not just for the Palm Economy, but for the handheld market at large. Three Palm OS licensees have exited (HandEra), retreated (Sony), or been absorbed (Handspring) in the past 18 months, the three that pushed the envelope the most. While there are still a dozen or so other licensees, most are in niche markets where they have no serious competition. palmOne, and perhaps Garmin, are the only general-purpose handheld makers with Palm OS left. Even if they are doing well for themselves, that's cause for concern.
And not just for Palm OS users, either. The Windows Mobile market, while it has more licensees, has also become essentially a two-company game; HP and Dell, with HP way out in front. As the handheld market has matured it has, as most markets do, shaken out to a few big players and marginalized everyone else. That's actually bad news for buyers, as less differentiation and competition means slower progress and fewer choices, as the costs of development and the costs of entry into the market rise.
The silver lining is the just-emerging synergy of handheld and mobile phone, but that is even more of a big-boys-only club. Getting a wireless device picked up by a big carrier requires a lot of capital, not only financial but political. Small start ups have a much harder time in an entrenched market like mobile phones. Don't expect many dark horses like Handspring and HandEra anymore.
Sadly, the handheld market has matured. It's now entering its early 30s, and is beginning its slow, painful decent into middle-age. And as anyone who has done that themselves can tell you, things just aren't as fun as they used to be.
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