Affordability and Simplicity Draw U.S. Consumers

MILPITAS, Calif., Feb. 6 /PRNewswire-FirstCall/ -- According to market-information company The NPD Group, the Palm(TM) Zire(TM) handheld was the best-selling PDA in U.S. channels during the fourth quarter of 2002 -- accounting for 13 percent of unit sales. The NPD Group data also confirmed the Palm Zire handheld had the highest sales figures during its first three months after introduction of any handheld tracked by the market-information company. The NPD Group reported that during the quarter more than 228,000 Palm Zire handhelds were sold. Additionally, the five top-selling handhelds during the quarter all were Palm branded products -- accounting for 46 percent of all units sold.

Palm Solutions Group also said that registration data indicates more than 90 percent of consumers who bought Zire handhelds are new handheld purchasers -- exactly the customer set Palm intended. Palm believes that many of the Zire buyers of today will become purchases of higher-performance Palm handhelds in the future.

The Palm Zire handheld, which was introduced Oct. 7, 2002, is the most affordable and lightest-weight Palm branded handheld to date. With an estimated U.S. street price of $99, the Palm Zire handheld target buyer is the first-time purchaser who needs an affordable way to organize a busy life. Named as a best product of 2002 by BusinessWeek, PC Magazine and others, the Zire handheld helps students, families and individuals in business meet the demands of juggling endless events and other activities.

"Growing the handheld space with fresh products that target new customers is infusing new energy in the PDA category," said Ken Wirt, senior vice president of marketing and product management for Palm Solutions Group. "The NPD Group data is an indispensable tool that ensures that we have the best market intelligence to react rapidly to changes in the marketplace."

While the handheld space is still a nascent market, Palm research shows that in the United States alone there are more than 63 million individuals interested in purchasing handheld devices.(1)

Palm Zire Handheld Led European Sales

According to GfK's latest analysis (October/November 2002), all five top-selling handhelds in Europe are Palm branded devices. The Palm Zire handheld, introduced on Oct. 8, led with more than 12 percent of the market. The Palm family of handhelds led with 44 percent of the market, up 6 points vs. August/September.(2)

Palm Zire Handheld Features and Benefits

The Palm Zire handheld is an easy way for consumers to carry the information they need, anywhere they go. The Zire handheld is an elegant and sleek device -- the lightest-weight Palm handheld on the market at 3.8 ounces. The distinctive, polished white face and silver back lends a visual simplicity and elegance. The new two-button design focuses on what matters to first-time users -- Address Book and Date Book -- while providing an engaging look and feel. Palm's famous, easy-to-use personal information applications allow users to quickly keep track of important information. Recurring appointments need only be input once. Helpful reminder alarms alert users to meetings or appointments.

The Palm Zire handheld can store approximately 6,000 addresses, 5 years of appointments (approximately 3,000 entries), and more. Zire handheld users can expand the functionality by choosing from 16,000 commercially available applications, from business software to puzzles and games to personal productivity software (www.palm.com/zire). Zire handhelds also come with four interactive games: Puzzle, Minehunt, Giraffe and Hardball.

"The introduction of the original Pilot handheld from Palm in 1996 ignited a revolution around the world. And now, the simplicity, tiny size, low price and long battery life of the Palm Zire handheld continues to fuel that revolution, leading to rapid adoption of the device and extending the Palm brand as the trusted choice for handheld computing," said Wirt.

About The NPD Group, Inc.

The NPD Group, Inc. (NPD) is a global market information company that measures product movement and consumer behavior across a broad range of industries -- apparel, automotive products, consumer electronics, cosmetics and fragrances, food, foodservice, footwear, housewares, information technology, interactive entertainment, toys and music. NPD's clients, many in the Fortune 500, use this insight to uncover market opportunities, strengthen channel relationships and benchmark industry performance. Since 1967, NPD has introduced numerous industry firsts, most recently combining and calibrating information from consumer panels and point-of-sale tracking via its flagship services, the NPD Worlds. The firm has offices and affiliations in 60 countries. For more information on The NPD Group, visit http://www.npd.com .

About Palm, Inc.

With shipment of more than 20 million Palm handheld computers, many carried in pockets, purses and briefcases around the world, Palm delivers devices that make it easy for people to use and keep track of what matters to them.

Information about Palm, Inc. (Nasdaq: PALM) is available at http://www.palm.com/aboutpalm .

(1) Source: March 2002 Maritz: Thompson Lightstone US only segmentation
study.
(2) Source: GfK's Small organizing solutions panel - Euro 7: France,
Germany, UK, Italy, Spain, Sweden, Netherlands. The GfK Group, a
leading international market research organization, has four business
divisions, Consumer Tracking, Non-Food Tracking, Media and Ad Hoc
Research. For further information, visit the website: www.gfkms.com

NOTE: Palm and Zire are trademarks of Palm, Inc. Other brands may be trademarks of their respective owners.

SOURCE Palm, Inc.