Outlook: Psion venture deserves success

SO MAYBE Psion does have a future after all. Until yesterday, the manufacturer of those dinky hand-held computers looked destined to go the same way as Apple, becoming a much-admired but obsolete player in an industry dominated by the mighty Microsoft. Everyone recognised that Psion's software was the best. But nobody else wanted to use it.

Yesterday's deal has changed all that. In one fell swoop Psion has tied the world's three largest mobile phone manufacturers into its software. When Ericsson or Nokia launches a phone next year that lets you check your bank balance or order some theatre tickets, it will be running Psion's software. For proof of the potency of this combination, consider that Motorola was prepared to pay a hefty premium for getting involved at the last minute.

But how stable will this combination be? The mobile phone market is about as competitive as they come. Motorola, Nokia and the others spend most of their time desperately thinking of ways to get ahead of each other. How comfortable will they feel rubbing shoulders and sharing know-how in Symbian's boardroom? And will other manufacturers want to license software that is owned by their main competitors?

Nevertheless David Potter, Psion's chairman, deserves a round of applause. Having already built a world-leading technology company in a country which tends to let its best ideas get exploited abroad, he has now taken a bold move which gives his company a better than evens chance of surviving the onslaught from the likes of Bill Gates. He deserves to succeed despite the unstable nature of the alliance he has just put in place.