December 4, 1996 5:25 PM ET

Corel to re-evaluate PDA plans
By Margaret Kane

  Corel Corp., which has backed off plans to develop a Java-based PDA, will re-evaluate the project in January.

The Ottawa company will instead focus its energies on the Video Network Computer, its version of the thin client, according to a spokeswoman.

"The VNC is really taking higher priority right now," said the spokeswoman. "For the short term, the focus has changed and more energy is going into [it]."

Corel announced plans for the PDA (personal digital assistant) in September. It was expected to retail for less than $500 and run applications on the Java OS, including a World Wide Web browser, scheduler, address book and E-mail. The Java OS was to be embedded into a kernel in the machine, with the Java virtual machine on top.

So far, only preliminary work has been done on the device, the spokeswoman said. Scheduled to be released in the second quarter of 1997, the PDA is now in limbo, she said. The company will reevaluate its timeline in January.

Corel's PDA would have faced stiff competition from a slew of PDAs announced at Comdex that work with Microsoft Corp.'s Windows CE operating system. Compaq Computer Corp. and Hewlett-Packard Co. were among the companies debuting devices that run on the operating system.

Corel's decision to postpone competing in that market was applauded by one analyst.

"I was concerned about their plans to enter that market when they announced in September, not only because I thought that market would be crowded with a slew of CE devices, but also because it's not a core competency of Corel," said Howard Lis, partner and technology analyst at Griffiths, McBurney and Partners, in Toronto.

Corel should not spread itself too thin, Lis added.

"Yes, they are going to focus on the NC, but they also dropped the [PDA] project because they realize they have to focus resources--human and financial--better," he said.

While the VNC is also not exactly a core competency for the software company either, Corel will use some of its knowledge in the video arena by developing the thin client around its current videoconferencing products, Lis said.

"I'd like to see them drive the business by selling their Java suite to the other NC vendors, and let them develop the market on the NC hardware side," he said. "If it's a temporary strategic move to be in the NC market and accelerate adoption of Java-based software, and they manage to do that with minimal expenditures, then it's sensible."

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