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Palm Signs Treo Deal with Blackberry Too

PDA and smartphone maker Palm's recent deal to put Microsoft's Windows Mobile on a future Treo smartphone device seemed like a blockbuster move at the time. But with news this week that Palm has signed a similar deal with Blackberry maker Research in Motion (RIM), it's clear now that Palm is just covering all the bases. The message to customers seems clear: If we build it, you will come. And now, for the first time, a smartphone maker will offer devices with all three of the major smartphone operating systems available.

"We are extremely pleased to broaden the choice of BlackBerry-enabled handsets with the \[Palm\] Treo 650," said RIM chairman Jim Balsillie. "We have already seen significant customer interest in this powerful combination, and we look forward to building on our relationship with Palm."

The move establishes Palm as more of a device maker, and positions the company better with corporate entities, which have been more inclined to pursue Windows Mobile and Blackberry devices than Palm OS-powered devices, because of those systems more readily available connectivity with back-end messaging servers. Blackberry devices, especially, are well known for their wireless email capabilities.

The deal is interesting for RIM as well. In its initial guise as a device maker, RIM had to compete head-to-head with devices powered by Palm OS and Windows Mobile. Now, the company is moving towards a model in which it focuses more on software and services, as it ports its Blackberry software to devices made by other companies.

Smartphone sales are still growing slowly, however. While RIM has accrued over 3.6 million subscribers over the years, various companies are selling just 3-4 million smartphones each year. By 2009, these companies will be selling roughly 6 million units a year, according to estimates. Part of the expected growth will come from enterprises finally being allowed to purchase their favorite devices running their favorite operating systems and services. In the past, getting a Treo, for example, meant sacrificing capabilities to get that device. On the flipside, many RIM users were happy about the service, but not big fans of the hardware.

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