It's no wonder then that the two companies have forged such a strong bond. I recently had a chance to speak with Joanne Taylor, Media Relations Manager for Extended Systems, to learn more about the company and its relationship with Palm, Inc. Taylor is pictured in Figure A.

FIGURE A


Joanne Taylor, Media Relations Manager for Extended Systems. Roll over picture for a larger image.

"Extended Systems has been selling into corporations for many years," Taylor explained. "We began as a spin-off of Hewlett Packard, selling print spoolers when that was really a hot technology and then graduated to print servers." This remained the business of Extended Systems for some time, helping them open several large corporate accounts. "What we are able to do now is to leverage those relationships into our new technologies."

That leveraging started with companies like Hewlett Packard and 3Com, which was where their relationship with Palm began, as at the time Palm was still a part of 3Com. This relationship eventually led to an announcement on March 6, 2001 that Palm, Inc. had agreed to acquire Extended Systems Incorporated as part of Palm's ongoing strategy to serve the enterprise marketplace. The slowing economy and market conditions took their toll, however, leading both companies to conclude that a termination of merger plans would best serve both companies and their respective shareholders. On May 17 the companies announced that they had mutually and amicably agreed to terminate their proposed merger agreement.

"With the challenges that Palm faces right now, they have to remain focused on their business today," Taylor said. "The last thing that they need is another business to manage." Ultimately, though, Taylor believes this will work out better for everybody. In fact, on June 26, Palm and Extended Systems, Inc. announced that they had signed a non-binding Letter of Intent for Palm to resell Extended Systems' XTNDConnect Server Software as a Palm branded product by the fourth quarter of this calendar year. "They can offer it as an add-on piece," Taylor explained. "This makes their offering a lot more valuable to the enterprise."