Microsoft Launches Pocket PC Campaign

Taking a sharper aim at rivals Palm and Handspring than in the past, Microsoft said it will launch on Thursday its largest-yet campaign for its Pocket PC operating system for handhelds under the theme “Software matters.”

The move coincides with the retail release of handhelds from Compaq, Hewlett-Packard, Toshiba and others based on Microsoft’s Pocket PC 2002, its latest upgrade to the OS, formerly known as Windows CE.

The print campaign, via McCann-Erickson, San Francisco, takes a “Pepsi Challenge” approach, comparing Pocket PC 2002 to Palm’s OS on applications like handwriting recognition, word processing and Internet surfing. In the handwriting recognition execution, an HP Jornada is compared to a Palm device. The Palm screen shows instructions for using the OS’s alphabet. The HP’s screen says: “Write notes in your own handwriting.”

“We’re really focusing on software as a differentiator,” said Ed Suwanjiandar, product manager. “In the past the [handheld] buying decision has been focused primarily on hardware.”

The effort comes as the stock prices of Palm and Handspring, a company formed by Palm’s founders, hit sub-$2 levels after overstock led both to slash prices. Handspring is planning “below the line” promotions for the holiday season instead of national advertising. Palm could not be reached for comment.

Placement includes the New York Times, the Wall Street Journal, Time and Newsweek plus, for the first time, outdoor. The budget for the effort was not given, but Suwanjiandar said it will easily double Microsoft’s 2000 spend for Pocket PC, which was $6.8 million, per CMR.