TOP PC maker Legend Group Ltd. on Monday launched two Chinese-language handheld computers powered by PalmSource Inc. software for the hotly contested, but shrinking China market.

The P100 model, with black and white screens, would retail at between 1,000 yuan (US$120) and 2,000 yuan, and the P300, with color screens, would sell at between 2,000 yuan and 3,000 yuan, Liu Junyan, general manager of Legend's handheld group, told reporters.

Both models, also known as PDAs (personal digital assistants), feature text in simplified Chinese characters and are designed to help users learning English, he said. They are built around Palm OS 5 software and will be sold early next year.

"We believe the education market in China has great potential," Liu said. "Within one year, we plan to sell 100,000 units."

Palm-powered devices held 6 percent of the domestic market during the third quarter of this year, executives said citing figures from research firm Gartner.

Lillian Tay, an analyst for Gartner, said the domestic PDA market was shrinking this year because many of its features had been included in mobile phones.

Handheld shipments in China were expected at 442,000 units this year, down from just over one million units last year, she said. Shipments next year were forecast at 475,000 units.

PalmSource said it had licensed its software to a new partner, Chinese computer maker Founder Technology Group Corp.

Five firms -- Legend, GSPDA, a unit of Group Sense (International) Ltd., PalmOne, Symbol Technologies Inc., Sony Corp. -- have already licensed Palm software for products in the China market.

GSPDA-made handhelds are distributed and sold by Beijing Capitel Co., a Chinese mobile phone maker.

PalmSource competes around the world with Microsoft Corp. and Symbian, a software consortium of which leading mobile phone maker Nokia owns a 32 percent stake.

(Xinhua News Agency December 9, 2003)