BILL GATES last night unveiled a device that he claims will forever change the way people use computers. The tablet PC, a notebook-style computer which allows users to write directly on to the screen with a special pen, was hailed by the world’s richest man as “a revolution”.

Launched simultaneously around the globe by Microsoft and 13 computer makers including Toshiba, Acer, HP and Fujitsu-Siemens, the tablet PC incorporates a revamped version of the ubiquitous Windows operating system.

The biggest innovation comes from software embedded in the computer that recognises a user’s handwriting and can store it in its original form or convert it to text.

Mr Gates said last night: “This is a reaffirmation of the kind of thing that has driven PCs since the beginning.”

Recently, Mr Gates told Microsoft’s shareholders: “By allowing people to have a device where you don’t need to use the keyboard, you simply literally have it in tablet form, you can take notes, you can read long documents sitting in any location that you’d like and you can annotate things and share those with other people.”

The first versions of the tablet PC went on sale this week, at a healthy 20 per cent premium to standard notebooks, which are already dearer than desktop PCs.

Because of its cost the tablet is initially being targeted at company executives, the rare few who will be able to rush out and buy one, although versions are also being created specifically for markets such as medicine and education.

Shares of iSoft, which provides software to the healthcare industry, rose 9p yesterday to 230½p after the company said it had been selected as one of Microsoft’s 30 launch partners for the Windows XP Tablet PC operating system. The company is the only software firm in Europe to be included in the launch.

Meanwhile, RM launched the first tablet PC designed specifically for the UK education market, which will retail for £799. Tim Pearson, RM chief executive, said “the potential in the education market is huge”.

More than ten years in the making, and with an original research and development budget of hundreds of millions of dollars, Mr Gates is understandably gushing in his praise for the tablet PC. Technology analysts, however, are not convinced.

Judith Jordan, an analyst with Ovum Holway, an independent research group, said: “We struggle to see how they will make this any more successful than the many previous attempts at pen-based computing that have been launched over the past decade.”

Microsoft has failed at previous attempts at pen-based computing and Apple Computer’s Newton, while clearly ahead of its time as the forebear of the current family of handheld computers such as the Palm Pilot, was still a commercial flop.

The launch of the tablet PC may inject some life into the moribund PC market, which remains mired in its worst recession on record. Demand from companies and consumers for upgrades to their existing hardware has waned following the frenzy to modernise in the lead-up to the millennium date change.

Microsoft is estimated to have pumped $400 million into the tablet PC and its associated software, a fraction of the company’s cash balance of more than $35 billion (£22.5 billion).

Gartner, a research house, says that despite the expected marketing barrage from Microsoft and its partners, less than half a million tablet PCs will be sold in 2003, about 1.2 per cent of the total projected PC shipments for the year.

Ken Dulaney, vice-president and research area director for Gartner, said: “Tablet PCs will have a natural fit in many vertical applications that currently use pen-based tablets. However, a lack of application support, clumsy hardware designs and a price premium will be barriers for most users.”

Steve Gales, the UK tablet PC manager at HP, said the US-based computer giant expects tablets to account for up to 20 per cent of worldwide sales of notebook computers in 2003, which would generate turnover of about £45 million in the UK alone.

He said: “We think the early predictions have underestimated the potential of the product. Early orders have been massive.’’

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