Ericsson plans PDAs, more collaboration

TAIPEI, Taiwan--With a projected boom in wireless Internet access looming, cell-phone giant Ericsson plans a move into the market for personal digital assistants and Internet appliances.

Along with the expansion, Ericsson will begin working more closely with third-party manufacturers and software developers, president Kurt Hellstrom said. The days when Ericsson did all of its own development are coming to an end, he said.

"Many people know that Ericsson has gone through some difficulties on the (cell-phone) handset side. The experience of that has increased the readiness in Ericsson to trust other methods of working," Hellstrom said at a press conference at the 2000 World Congress of Information Technology conference here.

"It is better to be first to market than to do it completely by yourself. Hopefully I will be able to change the culture," he added.

Ericsson is joining an increasingly crowded market for consumer electronics goods. Computer giants such as Hewlett-Packard, Compaq Computer and Gateway have already stated plans to market items such as watches, MP3 players and Web pads.

Sony plans to preview a personal digital assistant (PDA) at the PC Expo trade show in New York later this month. Cell-phone competitor Motorola earlier this month announced an agreement with Sega to jointly develop new cellular phones that can access the Internet.

In the handheld market, both Palm and Research in Motion are adding wireless functions to their devices.

"We are experiencing tremendous competition. We see a lot of new players," Hellstrom said. "We have plans to release PDAs and other things. We may do a few of them and collaborate with others."

Because of its problems in the past and the growth rate, the company will invariably be working with contract manufacturers, application developers and others to develop the new devices.

"This is a change from previous policy, which was oriented toward providing everything ourselves," Hellstrom said. "That is no longer possible."

Hellstrom would not indicate which companies will serve as partners, although collaboration with Asian companies is most likely. Late last week, in fact, the company opened a wireless application center here. Although Taipei is largely known for manufacturing PCs, Motorola has shifted some cell-phone manufacturing here, sources have said.

Despite the competition, the market for wireless Internet access devices should be huge. "In 2003, the number of mobile Internet users will pass the number of fixed (device) Internet users," Hellstrom predicted. "(Overall) access through a mobile device will surpass access from a fixed computer."

Currently, "China is Ericsson's fastest-growing market," he said. Chinese consumers are buying 2.5 million handsets a month from all manufacturers, he added.