Phones Get Smart

But jury's still out on their value

Second-generation smart phones are here, but it will probably be a while before corporations are convinced of their value as productivity tools.

Verizon Wireless recently introduced the Kyocera Smartphone that combines the Palm OS with a wireless phone and cost around $500. Most reviewers so far say its easy to use and smoothly integrates phone and personal digital assistant functions, but they suggest the device still needs some tweaking.

"The next generation will be even more elegant and more user friendly," promises CEO Delly Tamer. LetsTalk helps enterprises figure out what types of phones and service plans are best for their mobile workers. Tamer says he expects to see improved and lighter-weight products on the market later this year.

Whether users are interested in switching to a single device is open to debate. According to a Yankelovich Partners study commissioned by LetsTalk, 53 percent of users prefer to use a phone and a PDA; 34 percent say theyd prefer a PDA-enabled handset.

"There are some cases where a combination PDA/cell phone, like the Kyocera or the Ericsson 380, makes sense," Tamer says. If a workers productivity increases with the ability to check corporate databases with the PDA and at the same time hold telephone conversations, the product fits.

Employers pay for about 40 percent of all Palm-branded organizers sold, Palm says. So, its not a far stretch to imagine corporations cutting costs by equipping their workers with a single phone/PDA combo instead of a phone and a Palm.

Before organizations start to buy smart phones in volume, issues of customer support and training will need to be addressed, advises Alan Reiter, president of the Wireless Internet & Mobile Computing consultancy. "The wireless industry is going to have to do an order of magnitude better on supporting customers," he says. "

Companies like LetsTalk are hoping to capitalize on those shortcomings, by offering services such as application downloading and speed-dial setup to their customers.

The network operators also arent expected to take the lead in developing apps for the corporate user. "Itll end up being a third-party thing," says Chuck Gautney, director of the Wireless Accelerator program at Noblestar, a system integrator.

Verizon Wireless has a data group that finds apps for customers and works with applications developers to create services for users, explains Cheryl Noti, the companys associate director of voice portal and unified messaging. She says Verizon has begun to hear from companies looking to evaluate the Smartphone for their work forces.

The Kyocera Smartphone is the second iteration of the PDQ, the combined PDA/cell phone first introduced by Qualcomm. Kyocera later acquired Qualcomms phone business. The PDQ flopped mainly because it was too big and because information in the Palm OS wasnt tightly integrated to the phone functions.