Pen-Computers Find Niche Market

THE pen-computer industry is on the verge of a marketing comeback.

That's the view of Ronjon Nag, who makes software systems for computers that read handwriting.

Mr. Nag is confounder and general manager of Lexicus, based in Palo Alto, Calif., which he founded in 1992 and is now a division of Motorola Inc. Nag is at the forefront of a group of entrepreneurs who want the world to communicate by handwriting - handwriting linked to a miniature personal computer. It could be handwriting in most of the world's major languages. And it could be in cursive, print, or a combination of the two.

Nag says people are increasingly eager to buy small personal computer-like products that come equipped with a stylus or other handwriting device that converts handwritten notes or letters into typed messages. Those messages then can be immediately sent to another person. The receiving person picks the message up on his or her computer device - what the industry calls "personal communicators."

Some companies in the electronics industry introduced such technology several years back. Apple Computer Inc., for example, brought out in 1993 a pen-computing system, the Apple Newton. But following a burst of initial excitement, the concept of pen-computing systems hit the sales skids.

Nag says better days may now be in the offing. Both the hardware and the software in the devices have improved, giving the devices better handwriting recognition and faster response. And he's not alone.

"The concept of hand-held pen recognition systems in the early days was just not ready for prime time," says Tim Bajarin, president of Creative Strategies Inc., a high-tech consulting firm in San Jose, Calif. "It was totally over-hyped" as a mass consumer market.

"But now the concept is finding its niche," he says, such as in medicine, contracting, transportation, and other field operations away from a central office.

This market for pen computing is growing "very fast," says David MacNeill, associate editor of Pen Computing magazine. For example, some 30 states now use pen-computer systems in checking out their automobile fleets for required federal highway safety standards, Mr. MacNeill says.

One reason the pen-computing industry is doing better in niche markets - as opposed to the mass consumer market - is price, experts say. Costs for such personal communicator systems can easily range from $400 or $500 up to $2,000 or more.

NONETHELESS, experts expect it to become popular among other consumers eventually. "As the niche market grows, there should be a slow but steady growth" in the mass market for pen-linked personal communicators, says Jackie Fenn, research director with Gartner Group, in Stamford, Conn., an information technology service.

Apple's Newton is now widely used in medical offices, says Mr. Bajarin. And so too, Nag says, are his Lexicus software products, which are used in such small communicator devices as the Motorola Envoy and the IBM Think Pad. Other potential users, Nag adds, are police departments, claims adjusters, and sales representatives.

Nag says pen-based systems will eventually prove popular in the mass market. "The [personal communicator] devices," he says, "are becoming smaller every year. And processing power is doubling every 18 months." The result, he says, is that users are increasingly able to perform "broader tasks," such as sending e-mail and faxes.