Typing On Cloth

By Jennifer L. Schenker

Two European engineers start a company in Switzerland, take it public, move the headquarters to California and recruit a marketing whiz from APPLE to run it. The company evolves from a humble provider of computer mice to a seller of everything from cordless keyboards to webcams. And then it goes bust, right? That's the way the story is supposed to end in this grim, post-bubble era. But LOGITECH is defying that logic.

Despite the global slump last year, Logitech's profits grew 66%, to $69 million, on revenues of $720 million, in the past three quarters. Meanwhile, Logitech stock recently closed above $40, near its all-time high and up from $7.50 in February 1998, when Apple veteran Guerrino De Luca took over as CEO. A report by CREDIT SUISSE FIRST BOSTON dubbed Logitech "the ultimate Energizer bunny: it just keeps going and going and going."

This month at CeBIT, an information-technology fair in Hanover, Germany, that draws some 700,000 visitors, Logitech will introduce its entry in the mobile sector, a global market more than twice the size of the one for PCs. There are a billion mobile telephones in use, plus 50 million PDAs, compared with half a billion personal computers.

The center of the company's new mobile focus is the KeyCase, a folding cloth keyboard and case that works with Palm Pilots (but not, for now, with other PDAs). The device looks modest, but some road warriors may end up using it in place of a laptop.

About the size of a regular laptop keyboard, though with slightly smaller keys, the KeyCase is made of ElekTex, a lightweight fabric invented by Britain-based ELEKSEN, which combines conductive and traditional fibers in a way that allows it to be cleaned with a damp cloth and keep working even if you spill coffee on it. When a finger hits a key, the sensing system sends electronic impulses that can be understood by conventional electronic equipment.

Because the case is only slightly bigger than the PDA, the whole thing fits in a jacket pocket. The pitch: Why buy a regular protective case when--for less than $100--you can get one that will double as a keyboard? Says Bernard Gander, a Logitech vice president: "After this goes into production, we can print different designs on the cloth, perhaps even Gucci or Louis Vuitton versions."

A PDA slides into the KeyCase's patented cradle while it is lying flat. A spring and hooks, designed to work on all Palm models with a universal connector, attach the handheld to the keyboard. When the cradle is moved into typing position, it automatically turns the Palm on, and you're ready to type. "There is no need to take your notebook on the road now," says Denis Pavillard, Logitech's product-marketing manager. "You can just use your PDA."

At CeBIT, Logitech will also launch a foldable hard-case keyboard for pdas, called the TypeAway, that will compete with those sold by TARGUS and PALM. "Targus is a great product," says De Luca. "We made a mistake not to be interested in it." But Logitech is betting that it can catch up with the KeyCase and the TypeAway, which is more useful for keying in longer files, folds to a thickness of half an inch and weighs 3.9 oz., significantly smaller and lighter than anything else on the market.

Though supplying mice to computer vendors currently accounts for only 15% of its sales, Logitech, founded in 1981 and headquartered in Fremont, Calif., hasn't turned its back on its original product. At CeBIT the company will unveil its first Bluetooth-powered cordless mouse for laptops--a mouse with a built-in laser pointer for giving presentations.