Press Release

Real-world usage data confirms Palm Powered smartphones promotes higher revenue for Orange

Palm Powered Treo 600 delivers more than double the ARPU of an average Orange phone
 
SUNNYVALE, Calif., February 17, 2004 — PalmSource, Inc. (NASDAQ: PSRC) provider of Palm OS®, a leading operating system powering next generation mobile devices and smartphones, today announced the Palm Powered™ Treo 600 smartphone has delivered twice the Average Revenue Per User (ARPU) than the average mobile phone for leading mobile operator Orange.
 
In November 2003, the Treo 600 smartphone was one of the highest ARPU-generating handsets on the Orange UK network in its entire handset range. The average Orange phone delivers around 竄ｬ50 per month per user. The Treo 600 delivered well over 竄ｬ100. The Treo 600 is part of the Orange Signature phone series. Orange began its Signature phone series over a year ago, working with leading innovative hardware and software companies to deliver a simple and exclusive experience on their Signature phones.
 
Orange works closely with manufacturers and leading operating system providers, such as PalmSource, to create its Signature phone series. By collaborating on the development of the hardware and software of a phone, Orange can deliver what its customers want, giving them direct access to Orange services and one of the best possible customer experience. As a guide for manufacturers, Orange has specified 101 mandatory specifications that make up a Signature phone, with a further 102 recommended specifications.
 
Palm Powered smartphones combine advanced voice and data functionality with the easy-to-use Palm OS to make the business professional truly mobile. On the Treo 600, the keyboard, five-way navigation button and other design features enable the user to get more done-in fewer steps, with just one hand, and without having to swap back and forth between applications. With 20,000 Palm OS software titles available, users for Palm Powered smartphones can customize their device to fit their individual personal and professional needs. The extensive Palm OS software library is designed to offer a wide variety of vertical solutions for the communications, enterprise, education and entertainment markets, including Web browsers, email and Internet communications, sales force and field automation, personal productivity, groupware, financial management and games.
 
Florian Seiche, Director of Devices for Orange Global Brand Marketing and Products, said: "Our Signature phones are designed to be simple and intuitive, providing our customers with one-click access to key services and exclusive Orange services that help secure and manage content on the phone. By making it simple to use the handset and easy to access the services, our customers are finding a previously hidden benefit within their phones, and delivering a clear business return on our investment in these devices." "With the Treo 600 - one of our key Orange signature phones - we are currently seeing double the ARPU in comparison to our non-Signature series. We are looking forward to new and exciting applications being developed to continue to drive this usage."
 
"We believe that the significantly increased data usage and ARPU are a validation of the strength of the Palm OS platform in the smartphone category as well as the ease-of-use of our Palm Powered smartphones," said Albert Chu, vice president of business development, PalmSource. "We will continue to partner with leading operators to drive increased service revenue through compelling end user solutions, in an effort to achieve greater adoption of Palm Powered smartphones."
 
The Orange group is one of the world's largest mobile communications companies, with operations in 19 countries across Europe and beyond. It provides a broad range of personal communications services, including Orange GSM1800 services and other digital cellular telephone services. The Orange brand operates in the UK, France, Switzerland, Romania, Denmark, Slovakia, Luxembourg, Thailand, the Ivory Coast, the Dominican Republic, Cameroon, the Netherlands, Botswana and Madagascar. The Orange group also has controlled operations in Belgium (Mobistar). The Orange group has a joint controlling interest in Egypt (MobiNil) and minority interests in Portugal (Optimus), Austria (One), and Mumbai/India (BPL Mobile). As at the end of December 2003, Orange was the largest mobile operator in both the UK with over 13.6 million active customers, and France with over 20 million registered customers. As at the end of December 2003, Orange reports that its controlled companies had over 49 million customers worldwide. Further information about Orange can be found on the Orange website at www.orange.com.
 
About PalmSource
PalmSource, Inc. is the company behind Palm OS, a leading operating system powering mobile information devices. Approximately 30 million Palm Powered handhelds and smartphones have been sold to date worldwide. Industry leaders Aceeca, AlphaSmart, Fossil, Founder Technology, Garmin, GSL, HuneTec, Kyocera, Lenovo, palmOne, PerComm, Samsung, Sony, Symbol Technologies and Tapwave license Palm OS to create diverse mobile devices that meet unique customer needs. Palm OS has given rise to a large community of users, enterprises, developers and manufacturers, who together make up the Palm Economy. More information about PalmSource is available at http://www.palmsource.com, http://www.palmsource.co.uk, http://www.palmsource.fr, http://www.palmsource.de and http://www.palmsource.com.cn.
 
Palm, Palm OS and PalmSource are registered trademarks of, and Palm Powered is a trademark of, Palm Trademark Holding Company, LLC. Other brands may be trademarks of their respective owners.
 
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Such forward-looking statements include, without limitation, statements related to, Orange's ability to anticipate and meet customer expectations and demands, the features, functions and benefit of Palm Powered smartphones, and the benefits of available Palm OS software applications for the enterprise, wireless and multimedia markets. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include, without limitation, the ability of Palm Powered devices continue to produce ARPU that is acceptable to Orange or any operators; the ability of the Palm Powered smartphones, including the Treo 600, and Palm OS software applications to provide the anticipated results and benefits; acceptance of Palm Powered smartphones and Palm OS applications for the enterprise, wireless and multimedia markets by business professionals and other end users; our ability to benefit from any growth in the smart mobile device markets; and the general economic conditions in the U.S. and abroad and other risks and uncertainties contained in our public announcements, reports to stockholders and other documents filed with and furnished to the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the period ended August 29, 2003 and November 28, 2003. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements.