Palm has unwrapped two new handheld computers, seemingly undaunted by a lawsuit filed by NCR claiming that it owns the patent to the whole idea of the PDA. Both new Palms include a small expansion slot that lets users add extra memory and software applications to their devices, and eventually hardware add-ons such as a wireless modem or a digital camera. The m500 has a black and white screen and comes with 8MB of memory. The m505 has a 16-bit color screen and also includes 8MB of memory. Both devices look a lot like the existing Palm V, although the color version is a fraction thicker and weighs slightly more, at 4.4 ounces. The units come bundled with Palm's Mobile Connectivity Software, which lets users connect to the Web from certain types of mobile phones using a cable connector or the Palm's infrared port. They also include a new type of battery, called lithium polymer, which should add a few days' extra battery life, and a new version of Palm's operating system, version 4.0. But most notable is the addition of a slot about the size of a postage stamp on top of the devices which accepts a Secure Digital (SD) card. Users can slot an SD card into their Palm when they need extra memory, or to view content that will be sold separately by Palm and its partners. "We really chose the SD card because of its tiny size, which allowed us to incorporate it into the device without interfering with the elegant design. But it also opens a lot of doors in terms of extending the capabilities of the Palm to include new content and capabilities," said Stephen McDonnell, business development manager with Palm's consumer markets group. For example, Palm will offer a card that includes 10 computer games, including SimCity and Zap!2016. It will also offer SD cards for travellers that include city guides, a currency converter and a language translator. They come in three versions for travellers in the U.S., Europe or Asia Pacific, McDonnell said. For users who want more storage, Palm will offer a 16MB expansion card that could be used for storing images or other large files, or by corporate users for storing a large database. Palm is also selling a back-up card that lets users copy the contents of their Palm and then reload it in the event of a system failure. The company doesn't want to get too deeply into the SD card business, and hopes better-known card manufacturers such as Matsushita Electric (better known for its Panasonic brand), Toshiba and SanDisk will step up their own production to meet demand from Palm users, McDonnell said. Palm is also relying on partners to create hardware add-ons that make use of the SD slot to increase the functionality of the Palm, much like Handspring, one of Palm's software licensees, uses Springboard modules to extend the capabilities of its Visor PDA. Add-ons for the m500 series are likely to include a tiny digital camera, a wireless modem for connecting to the Web without having to use a cell phone or a telephone line, and an MP3 music player, McDonnell said. Palm has also said it will release an SD card for Bluetooth, allowing its handheld computers to make use of the short-range wireless networking technology. Because SD cards are widely used in digital cameras and MP3 music players, users will also be able to exchange the cards freely between devices, taking photographs and then viewing them on their Palm computer, for example. As well as SD Cards, the expansion slot accepts MultiMediaCards. Palm eventually plans to include an SD card slot across all of its handhelds as new models are introduced, McDonnell said. The m500 and m505 also include a new type of connector that works with a USB docking cradle, which should make it faster to synchronize data with a Windows or Mac PC. The connector also works with a serial cable that can be bought separately. That new connector isn't compatible with previous Palms, but the company has promised developers it will standardize on the new design for at least two to three years, McDonnell said. Version 4.0 of the Palm OS brings a handful of smaller improvements. Besides supporting SD cards and USB, the new operating system supports SMS (short messaging service) for exchanging text messages with other users; a wider range of password options; new types of event notification including a vibrate setting; and software that makes it easier to keep dates and times in order when travelling between time zones. The devices also come bundled with some bonus software including an e-book reader; DataViz Documents to Go for editing Word and Excel files; an improved calculator; an application from AvantGo for viewing Web content offline, and AOL for Palm OS, which lets members of the ISP check their email and instant messages. Both devices are scheduled for availability in the UK in June. Palm also said that IBM plans to release on May 1 a new version of its WorkPad PDA that includes the same design features as the m500 series, which presumably means an expansion slot. Trouble in the palm of your hand However, there is a slight chance that these devices will not ship at all, as NCR has filed a lawsuit earlier this week that could send ripples through the handheld market, as the company alleges it possesses patents to the types of devices developed by Palm and Handspring. NCR claims to hold two patents governing the creation and sale of handheld devices dating back to 1987, according to documents filed in US District Court in Delaware. NCR is asking the court to order Palm and Handspring to stop selling their handheld devices. Researchers from NCR developed devices for handling and transmitting data in a manner similar to that of current handheld devices such as the Palm Pilot or the Handspring Visor, the lawsuit says. NCR wanted to create a device allowing users to enter information for appointments, to-do lists, addresses and to execute shopping transactions - just like handhelds that have flooded the market since then. NCR also contends that it developed the idea of using docking stations where information could be exchanged between a handheld and other machines. Palm and Handspring should compensate NCR for damages related to past and future sales of devices that allegedly infringe on NCR patents, the lawsuit says. NCR would say little to elaborate on the charges. When asked whether NCR plans to extend the lawsuit to other handheld makers, company spokesman John Hourigan declined to comment.. Palm and Handspring were not immediately available for comment. Even though it claims to hold the patents, NCR did not release consumer handheld devices of its own. The company specializes in developing technology for cash registers, ATMs (automated teller machines) and other point-of-sale hardware. NCR is concentrating on increasing the amount of information available using its point-of-sale devices, Hourigan said.