"Lap Computer Market Ready to Boom" By David E. Sanger The New York Times NEW YORK-- When the Tandy Corp brought out the first truly popular "lap computer" a year ago, the $800 Radio Shack machine was quickly embraced by traveling salespeople, executives, journalists and others looking for a computer small enough to slip into a briefcase and powerful enough to communicate with the home office. But when Tandy's president, John Roach, looks behind him these days, he sees a lot of manufacturers-- both American and Japanese-- running hard to capture a chunk of the market that his company now dominates. "It's getting rough out there," said Roach, whose company by some estimates has sold 100,000 of the lap computers in the last year. "Nobody can hold on to 100 percent of the market forever." In fact, the market for sophisticated, battery-powered lap models is poised for an explosion. And for the next four years, analysts are predicting the sort of confusing product proliferation, price cutting and intense competition that makers of desktop and home computers are going through now. About 240,000 of these small machines will be sold in the United States this year, according to Future Computing Inc., a Richardson, Texas, market research company. In 1985 the number will double, and by 1988 shipments are projected to exceed one million units. Many of the names on the lap machines will be familiar: Radio Shack, Kaypro, Convergent Technologies and Compaq, among the Americans, all appear on the verge of new entries. And most in the industry are convinced that International Business Machines will have one, too, although if history is any precedent, the computer giant will not jump in until the dust begins to settle. Some of the names, however, will be new, like Gavilan and Grid Systems; others, of course, will be Japanese. Sharp, Nippon Electric and Epson have all weighed in with "first generation" models-- to mixed reviews. Despite the increasing competition, however, buyers this year are likely to be disappointed by the limitations of the early models. Most seem to want their lap model to be like an ideal lap dog: obedient to and command, friendly to play with and good for several years of loyal service. But none of today's inexpensive models, those under $1,000, come close to matching the performance of a desktop personal computer of modest capacity. And the industry still has a host of technical problems to solve before even the more expensive machines can run the popular word processing and business spreadsheet software. "The reason I haven't bought one is that the screens are still unreadable," said Esther Dyson, the editor of Release 1.0, a computer industry newsletter, voicing a familiar complaint. She added, "Anything with a full-size screen and keyboard is not going to fit in your pocket. It's a fundamental problem." For the computer industry, it is also a new problem. The first "portables" were 30-pound machines like the Osborn, made by the failed Osborn Computer Corp. Since then they have evolved into more sophisticated models, like Kaypro's line and those like Compaq's machines that are compatible with the popular IBM desktop models. But they have gotten no less weighty, and in the industry they are generally known as "luggables." Their great advantage is that the users sacrifice very little. Their screens, while small, are easy to read, their keyboard are full size and most models run standard software because they include disk drives. But the glory days of the luggables are over. Recently, to no ones surprise, IBM started shipping a portable of its own-- which many industry observers only half in jest call a "Compaq lookalike." With Big Blue bringing its marketing power to a niche it has until now ignored, companies like Compaq are scrambling to bring out new products, most likely lap models, that will sustain their momentum. They are not having an easy time. "It turns out it was a lot easier to put a full-function computer into a box the size of a suitcase than into one the size of a fat book," said Michael Murphy, co-editor of the California Technology Stock Letter. The first problem is screen size and clarity. Radio Shack and Nippon Electric, for example, have begun to encounter consumer resistance because their 8-line, 40-character-wide liquid crystal display is small and hard to read. "It is something people are really sensitive about," said Jeffrey Goldberg, manager of Washington Computer Services in New York, which dropped the Epson lap model "because no one wanted to buy something they couldn't see." Manny Fernandez, the president of Gavilan Computer Corp. of Campbell, Calif., apparently came to the same conclusion. Before he shipped his first Gavilan lap computer last fall, he announced a successor model, with a 16-line display. The kicker is that the new version of the 9-pound computer, which should be available this summer, will sell for $4,000; it includes a disk drive, something the less expensive machines do not. The lower-priced machines have their software built in at the factory, etched on what is known as a Read Only Memory chip, or ROM. But battery-run ROM's are expensive, severely limited in capacity and in short supply. As a result, current models usually do one thing well, but no more. Radio Shack's Model 100, for example, is a passable word processor, but cannot manipulate numbers in an electronic spreadsheet. Convergent Technologies' $1,200 Workslate, on the other hand, has a 16-line spreadsheet, but extremely limited word processing. One significant exception may come from the Lotus Development Corp., which says that its forthcoming "Symphony" word processor and spreadsheet program is designed to be etched on a ROM. Some manufacturers are already moving to solve the problem. Sharp, for example, has had good initial success with its $2,000 PC-5000, which includes a "bubble memory" that stores up to 128,000 characters of information. The Japanese machine, now being heavily promoted on television, has a flip-up, 8- line video screen that is significantly easier to read than most. For an extra $750, it comes with a modem for sending data over a telephone line and a built- in printer. But Sharp and others may be given a tough run by Kaypro, which has teamed up with Mitsui, another Japanese computer manufacturer. Under the Kaypro label, the two will market a computer that will be half desk model, half lap model, and designed by many of the same engineers who made the Radio Shack lap computer. "There will be two parts, a notebook and a base," explained David Key, Kaypro's vice president of marketing and product planning. The base will have standard disk drives and a traditional video screen. The "notebook," which probably will look like a lap computer and can be unplugged from the base, will have a flat liquid crystal screen of it's own.