July 28, 2005 2:10 PM PDT

Tapwave exits game device business

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Tapwave shut down its Zodiac handheld device business this week, meaning one less customer for struggling PalmSource, maker of the Palm operating system.

Tapwave, which sold the Zodiac gaming devices with organizer features, posted a notice on its site that it was discontinuing sales, service and support as of last Monday. It said that liquidation specialist Uecker and Associates will be contacting anyone with outstanding claims against the company.

The privately held gaming device maker debuted its Zodiac handhelds two years ago, as it sought to find a niche in the struggling PDA (personal digital assistant) market. As part of this effort, Tapwave partnered with PalmSource to carry its operating system on its devices.

Although the demise of Zodiac is not expected to dramatically dampen PalmSource's shipments, it will nonetheless have a significant effect in other ways, said Richard Shim, an IDC analyst.

"From an influence standpoint, it hurts PalmSource," Shim said. "They pointed to Tapwave as an example of applications of the Palm OS outside of handhelds."

PalmSource is facing a shrinking market for handhelds, and Tapwave provided customer diversification for its partner.

PalmSource "is losing a licensee that doesn't play solely in the organizer market," Shim noted.

Last year, PalmSource was dealt another blow when Sony announced it would discontinue sales of its Clie handheld in U.S. and European markets. Clie was another PalmSource customer that went beyond basic organizer features, offering a multimedia handheld.

Tapwave and PalmSource representatives were not available for comment.

4 comments

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I blame their CEO
Peng Lim was an idiot when he worked at Palm. What made him think that he could lead his own business to success? Obviously nothing changed and his creation is now dead.

Their marketing squarely aimed at Nokia's N-Gage, which also flopped, when they should have been targeting the mass market. Of course, they would have to lower prices and actually get a real game studio to create titles for their device, but being the smart guy that Peng Lim is, you would have thought he would have known that, right?
Posted by David Dudley (446 comments )
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I blame their CEO
Peng Lim was an idiot when he worked at Palm. What made him think that he could lead his own business to success? Obviously nothing changed and his creation is now dead.

Their marketing squarely aimed at Nokia's N-Gage, which also flopped, when they should have been targeting the mass market. Of course, they would have to lower prices and actually get a real game studio to create titles for their device, but being the smart guy that Peng Lim is, you would have thought he would have known that, right?
Posted by David Dudley (446 comments )
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not much Tapwave could've done
bad business model. Not good when you walk into an EB Games and see demo Ngage QDs along with a rack of games for it, but no zods. Not good to walk into Staples and see Clie PDAs, Palms, PPCs, but no zods. Just online isn't enough. And compUSA is a joke. THey don't take care of their store models. Their current selection of PDAs can't be demo-ed anyways b/c they're not charged

Ngage QD was also a flop, but at least Nokia's got deep pockets to fall back on. Between competing vs $150 GBA's and Sony's PSP announcement, TW didn't stand a choice. TW did get some agreements for some games for their device, but they were empty promises. They devs were really trying to work with Sony to focus games for PSP first.

All in all, nice effort none of the less. The Zodiac may not be in mainstream sale anymore, but the zod community is still going strong.
Posted by ackmondual (199 comments )
Reply Link Flag
not much Tapwave could've done
bad business model. Not good when you walk into an EB Games and see demo Ngage QDs along with a rack of games for it, but no zods. Not good to walk into Staples and see Clie PDAs, Palms, PPCs, but no zods. Just online isn't enough. And compUSA is a joke. THey don't take care of their store models. Their current selection of PDAs can't be demo-ed anyways b/c they're not charged

Ngage QD was also a flop, but at least Nokia's got deep pockets to fall back on. Between competing vs $150 GBA's and Sony's PSP announcement, TW didn't stand a choice. TW did get some agreements for some games for their device, but they were empty promises. They devs were really trying to work with Sony to focus games for PSP first.

All in all, nice effort none of the less. The Zodiac may not be in mainstream sale anymore, but the zod community is still going strong.
Posted by ackmondual (199 comments )
Reply Link Flag
 

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