Smaller Is Better, Say Makers of Ultraportable PCs

But will consumers agree? OQO, Samsung, Sony, and others test the waters.

If you’re itching to upgrade to Windows Vista, the new Microsoft operating system to be launched Monday, January 29, chances are you’ll need a new computer, given Vista’s hefty hardware requirements. And when you think about spending $1,000 or more on that computer, chances are, you’re picturing a desktop or a laptop–not a half-kilogram device with a screen smaller than a piece of toast.

The OQO 02 (above) from OQO was launched to much attention at the Consumer Electronics Show in Las Vegas earlier this month. This and several other new devices put the power of a full Windows PC into a palm-size package.

But engineers at San Francisco-based OQO (pronounced “oh-kyoo-oh”) think 2007 might be the year when U.S. computer buyers come to think of diminutive “ultramobile PCs” as practical alternatives to the personal computer’s beefier desktop and laptop manifestations. Their new OQO 02, launched January 7 at the Consumer Electronics Show in Las Vegas, is 14 centimeters wide, 8 centimeters high, and 3 centimeters thick–small enough to toss in a purse or a large pocket. Yet it’s a full Windows Vista-capable computer, with a 1.5-gigahertz processor, an 800-by-480-pixel touch screen, a slide-out keyboard, and three kinds of wireless connectivity.

“If you’re a mobile professional, you need to be connected to the Web and access applications as part of your daily life–so your computer needs to be small enough and light enough that you’re willing to take it with you when you leave your desk,” says Bob Rosin, vice president of marketing at OQO. Laptops don’t meet that standard, Rosin argues. “If your computer weighs five pounds and requires a briefcase, that’s very different from something you could throw in your jacket pocket.”

The company’s previous product, the OQO 01, held the title of “world’s smallest Windows PC” for two years and attracted business customers who needed small PCs for field inspections and similar mobile activities. But as a general personal-computing device, the OQO 01 was met with mixed reviews and sluggish sales. The new model includes many upgrades recommended by OQO 01 owners, such as a brighter screen, a better keyboard, more-powerful batteries, and a docking station with an optical disk drive, according to Rosin.

Even with such improvements, it’s not clear whether U.S. mobile professionals–OQO’s initial target market–will be attracted to sub-notebook-sized PCs. The OQO 02 belongs to a new generation of small Windows computers, including ultramobile PCs such as the Samsung Q1, that can run the same software as Windows desktops and laptops but are designed to be used from a sofa, conference room, or airplane seat. Miniaturized PCs have proved popular in Japan, where consumers have shown a willingness to pay extra for high-powered devices in small packages. But the gadgets are still largely untested in the United States, where they’re often criticized for their slow performance, their tiny or nonexistent keyboards, and their high prices. (At $1,000 to $2,000, the devices often cost more than laptops of equivalent power.)

Some consumer-electronics watchers say OQO and other companies are beginning to overcome the basic problems that make small PCs tricky to use. For example, U.S. users don’t like to type or write on touch screens, so some manufacturers are including real keyboards with improved tactile feedback, while others are simplifying onscreen interfaces so that users can get more things done with fewer gestures and clicks.

“The original version of the OQO had a lot of gotchas,” says Rob Enderle, principal analyst at the Enderle Group of San Jose, CA, which advises companies on personal technology products. “It was incredibly small, but it was also painfully slow. The new one is a decent machine. I had Vista up and running on it pretty fast, and it performed just fine.”

Better performance was one of three specific goals emerging from complaints lodged by users of the OQO 01, according to Rosin and Jihye Whang, OQO’s director of product management. “It needed to really feel like a notebook computer,” says Rosin. “It had to be a full Windows Vista device, and it had to run applications in a really snappy way, without hesitation.” The OQO 02 runs standard Windows programs from the Firefox browser to Adobe Photoshop, and it has enough processing power to run two 1,920-by-1,200-pixel external displays when plugged into its docking station.

Users also pleaded for better ways of connecting to the Internet, says Whang. The OQO 01 could connect only at Wi-Fi hot spots or via a Bluetooth connection with a networked mobile phone. The OQO 02 includes faster 802.11g Wi-Fi circuitry and can also connect to Sprint’s EV-DO network, a broadband data service available in most of the same locations where Sprint operates its PCS phone network. EV-DO carries data at 400 to 700 kilobits per second–not as fast as home DSL or cable Internet connections, but much faster than previous generations of cellular data networks. “We’re getting closer and closer to true broadband speeds,” says Whang.

Finally, users demanded a better screen and keyboard. The five-inch-diagonal touch screen is six times brighter than its predecessor, says Whang, and it incorporates a few new tricks, such as the ability to zoom in on an area of detail and to scroll vertically or horizontally with the brush of a finger along the screen’s border, eliminating the need for a mechanical thumbwheel like those on many PDAs. The 58 keys on the OQO 02’s redesigned keyboard stick up higher than the OQO 01’s keys, giving thumb typists more tactile feedback to confirm that they’ve struck a key. The keyboard is also backlit for nighttime operation.

The OQO 02’s keyboard is indeed “much more usable this time,” in Rob Enderle’s estimation. And while the device is slightly larger and heavier than the OQO 01, carrying it is “still a hell of a lot easier than lugging a laptop around,” he says.

But in the lighter-than-a-laptop category, the OQO 02 could face competition from other handheld devices, such as Sony’s Vaio UX Micro PC, Nokia’s N800 Internet tablet, and Motion Computing’s LS800 Tablet PC, as well as an entirely new category of handhelds, the so-called Ultra-Mobile PCs, or UMPCs. Samsung, Medion, Asus, and several other manufacturers have begun to produce these book-size devices, which look like small tablet PCs and are all based on a reference design unveiled by Microsoft in 2006 under the name Origami. The devices have Wi-Fi and Bluetooth connectivity and are operated solely via a touch screen (although at least one UMPC includes a slide-out keyboard similar to OQO’s). So far, they’ve been marketed not as office appliances but as entertainment devices enabling users to browse the Web and access videos, music, and photos.

The first group of UMPCs shipped with a plain Windows Tablet PC operating system. But at the Consumer Electronics Show, the company introduced the Origami Experience, a new user interface for Vista-based UMPCs that does away with the traditional desktop environment in favor of a single menu that scrolls both horizontally and vertically, letting users navigate quickly to their media files without a stylus or keyboard. Reviewers are calling the Origami Experience “speedy,” “intuitive,” “helpful,” and “sexy”–terms not often associated with Windows devices. This suggests that the UMPC may have a shot at attracting the same kinds of consumers who shell out for the indisputably sexy Apple iPod.

At OQO, Rosin and Whang say they’re not worried about going up against the UMPCs. “We see the OQO 02 as a productivity tool,” says Rosin. “The businessperson may want to have some personal stuff on their mobile PC, but our focus is really on the professional user, not on the teenager on the couch wanting to browse the Web with a tablet-type device.”

Nor is OQO concerned about Apple’s forthcoming iPhone, which is descended from the video iPod but will mimic many of the functions of a full PC, via an advanced touch-screen interface that early reviewers have greeted as potentially revolutionary. “The iPhone is probably the best thing that’s ever happened to us,” says Rosin. “Everyone is now thinking, ‘We need more than just voice on a cell phone,’ and ‘We need more than just audio on small devices.’ So there’s a lot of interest in this category, and we think that’s a good thing for OQO.”

The OQO 02 and the other small PCs hitting the market this year do have a few common weaknesses. One is battery life. It’s getting longer–four hours in the case of the OQO 02 and three hours for the Samsung Q1–but it’s still not long enough to keep a businessperson busy for the duration of a transcontinental flight. OQO’s devices and the UMPCs “need a minimum of 8 hours of battery life to succeed,” writes Tim Bajarin, president of Creative Strategies, a technology consulting firm based in Campbell, CA.

And the screens and keyboards on the new devices, while improving, are still impractically small for some users, especially older users with less-than-perfect vision or dexterity. “My 28-year-old son can use the OQO 02 just fine,” Bajarin says. “But for old guys like me with bad eyes and fat thumbs, it’s really tough.”

But Bajarin’s biggest concern relates to manufacturers’ marketing strategy rather than to mechanics. He believes consumers will start buying ultraportable PCs only when they’re shown to have a compelling application–say, browsing the Web and controlling the TV, set-top box, DVR, and stereo system from the sofa. But as long as ultraportable PCs are marketed as general-purpose devices, software writers won’t be inspired to write the killer app that makes the devices take off, he argues.

“With a device of this size, if you take the PC mentality and say, ‘Let it be all things to all people,’ it will fail,” Bajarin says. “But if you say, ‘It’s a platform for application-specific solutions,’ then you’re more likely to get it right.”

Enderle, however, believes PCs could find a market even without further tweaking or new software. With its faster processor and full Windows capability, OQO’s device, in particular, could appeal to “folks for whom a smart phone isn’t really enough and a laptop is too much,” he says. “That’s still a niche group–but it could be a pretty good-sized niche.”

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