Internet Access in the ‘Palm’ of Nokia’s Hand

Nokia (NYSE: NOK) and Palm Computing (Nasdaq: COMS) announced today that Nokia will license the Palm Computing Operating System (Palm OS) to run mobile phones that can access the Internet.

In the deal, Nokia will get a mobile phone operating system that is already widely accepted by application developers and millions of Palm users. In return, 3Com Corporation’s Palm Computing will get the opportunity to extend its Palm software business.

Nokia intends to use the Palm OS in its pen-based mobile units. “In the emerging mobile information society, we anticipate strong demand for various categories of future wireless devices,” said Jorma Ollila, chairman and CEO of Finland-based Nokia. “So far, our handset offering has included phones with keypad input as well as communicators with keyboards. Now we intend to complement our range with products using pen-based input.”

“In that category, Palm Computing is a leader and has a wide market presence,” added Ollila.

For Palm Computing, based in Santa Clara, California, the agreement offers entry into a global marketplace. “This is an exciting new growth opportunity for the Palm Economy,” said Alan Kessler, president of Palm Computing. “It will provide an innovative, flexible foundation for Palm’s thousands of developers to expand the mobile information management market into new territories worldwide.”

Both Companies Prepare For Boom

Presently, only a small number of the 300 million mobile users currently have Web access, but that figure is expected to change drastically over the next few years. The wireless communications industry is aggressively gearing up for the coming changes. By 2005, experts believe that 1 billion people will use mobile phones, and Internet access is expected to become a standard feature on most wireless devices.

As part of the agreement, Nokia and Palm will maintain backward compatibility for current Palm applications, ensuring that the majority of existing applications will be supported on the next generation of products produced by the partnership. The companies expect to begin to disclose information on new products and tools during the next 12 months.

About The Companies

Palm Computing, Inc. is a 3Com company that provides handheld computing devices and operating systems, including the Palm II, Palm V and Palm VII series of connected organizers. 3Com Corporation is a networking company with 300 million customers.

Nokia is a leading mobile phone supplier, as well as a leading supplier of mobile fixed and IP networks. The company employs more than 51,000 people.