PalmSource buys into China and Linux

PalmSource today promised a Linux version of its operating system, together with a cut-down offering for use in budget mobiles, after buying mobile phone developer China Mobilesoft.

The move is designed to allow PalmSource to broaden its customer base by selling outside the relatively small smartphone market.

The firm said that, as China Mobilesoft already has its software on 30 mobile devices, the acquisition doubles the number of PalmSource phone licensees.

David Nagel, chief executive at PalmSource, told vnunet.com: "This allows us to significantly broaden the range of devices we can use, not only for smartphones but for feature phones at all prices.

"Finally this allows us to port our user interface and applications framework onto a Linux-based platform using China Mobilesoft's expertise."

PalmSource plans to issue approximately 1,570,000 shares to pay for the company, subject to shareholder approval. At current market rates that values China Mobilesoft at over $20m. The Nanjing-based company has over 100 staff whom PalmSource will employ.

Nagel claimed that the purchase would double PalmSource's software development team and, because of low wage costs in the Far East, do so at a very competitive rate.

Rachel Power, an analyst at Canalys, said: "I think this is indicative of the convergence we're seeing as phones get more powerful and able to run more sophisticated software."

She added that there is currently very little European demand for mobile Linux. "PalmSource was not able to reveal any details of hardware vendors using the products and that will be the test of their success.

"As for [mobile] Linux, that's playing to the Asian market at the moment. We do not see the requirement or the interest as yet in Europe."