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Almost buried as an afterthought in AT&T's announcement of coming smartphones from Palm (Nasdaq: PALM ) , the Dell Aero is the carrier's second phone built around the Google (Nasdaq: GOOG ) Android software platform. It's also Dell's first major handheld gadget in the U.S. since the company discontinued its Axim line of PDAs in 2007, citing a "steadily declining market for pen-based PDAs."
That was just about when Apple (Nasdaq: AAPL ) launched the first iPhone and showed that there was a market for a new, finger-based PDA-like gadget. In that sense, the Aero could be seen as a revived Axim, with shiny new software and a refreshed hardware inventory. Dell still called the Axim a success even as the company announced its demise, so I imagine that the return to the handheld market is a welcome one. Dell could certainly use any edge it can grab as Hewlett-Packard (NYSE: HPQ ) , Apple, and others turn Dell's formerly market-leading PC division into an eternal pretender.
The Aero appears to be a rehashed Mini 3, the smartphone Dell sells in markets like China and Brazil. A few months of working out the kinks in this design elsewhere should ensure a trouble-free product for the American market, even if the hardware might lag behind top-shelf models like the Nexus One.
The Aero is not likely to make a huge splash when it hits store and virtual shelves later this year. Dell's brand name might attract a few curious shoppers, but there are lots of other smartphones with equally strong consumer pulls and other selling points, including an onrush of Android devices. Dell will get lost in the flood, at least for a while. If the Aero gets a sequel, one that applies the lessons learned from this first outing, Dell might become a force to be reckoned with in call-enabled PDAs. Uh, I mean "smartphones."
Check Dell's smartphone business again in 2011 or 2012, in other words.