PalmSource and Telefonica Moviles Espana Collaborate To Grow the Smart Mobile Device Market in Spain Leading Spanish Mobile Operator Joins Palm Powered Mobile World CANNES, France, Feb. 23 /PRNewswire-FirstCall/ -- 3GSM WORLD CONGRESS -- PalmSource(R), Inc. provider of Palm OS(R), a leading operating system powering next generation mobile devices and smartphones, and Telefonica Moviles Espana (TME), the mobile operator of Telefonica Moviles, today announced TME has joined the Palm Powered(TM) Mobile World program to speed up the availability and accelerate the adoption of Palm Powered smartphones in the Spanish mobile market. As a new charter member of Palm Powered Mobile World, Telefonica Moviles Espana will collaborate with PalmSource and leading Palm OS licensees to bring cutting-edge smart mobile devices to the Spanish mobile market. In addition, TME will work closely with PalmSource to align the Palm OS platform with TME's requirements and service offerings. TME will also collaborate with PalmSource in cooperative marketing activities and leverage the approximately 275,000- strong Palm OS developer community to provide key vertical market solutions including sales force automation, utilities, logistics and delivery. Today's announcement builds on PalmSource's commitment to optimize the Palm OS platform for the creation of cutting-edge Palm Powered smartphones that produce higher Average Revenue Per User (ARPU) and deliver a compelling Palm Powered experience for wireless customers.In addition, the collaboration reinforces PalmSource's strategic objective to extend the Palm OS platform into the emerging mobile data market in Spain, while providing increased revenue opportunities for leading mobile operators such as TME. "The combination of two market leaders in Spain for mobile devices and services will promote greater penetration of Palm Powered smartphones into the Spanish mobile market and accelerate the mobile data business for TME," said David Nagel, president and CEO of PalmSource. "We look forward to working with PalmSource to offer our customers cutting-edge smart mobile devices that provide a truly compelling Palm Powered user experience," said Luis Ezcurra, Development Services General Manager of Telefonica Moviles Espana. "The leading market strength and innovation of the Palm OS platform will extend our market leadership, reduce time to market and increase ARPU for our Palm Powered mobile products and services." Palm OS provides a flexible and efficient platform that enables hardware manufacturers and software developers to rapidly and efficiently create a wide range of powerful, innovative and easy-to-use smart mobile devices and software applications. Approximately 30 million Palm Powered handhelds and smartphones have been sold to date and Palm OS has attracted a large and loyal following of approximately 275,000 developers building applications for Palm Powered smart mobile devices. About Palm Powered Mobile World Launched in the Fall of 2003, Palm Powered Mobile World is a marketing program that connects mobile operators, infrastructure providers and software developers to efficiently bring Palm OS software applications and solutions to market, providing increased revenue opportunities and a superior user experience for Palm Powered smart mobile devices. TME joins mobile operator partner, Sprint, and Orange announced separately today, as well as infrastructure partners in the wireless Palm Powered ecosystem to capitalize on the growing smart mobile device market. More information regarding the Palm Powered Mobile World program can be found at http://www.palmsource.com/mobileworld. About TME Telefonica Moviles Espana (http://www.empresa.movistar.com/) is the operator of Telefonica Moviles Group in the Spanish market, where it has more than 19.66 million active customers at the end of 2003 and offers a comprehensive portfolio of data services and applications using the latest mobile technologies, including GPRS, MMS and UMTS. Telefonica Moviles, S.A. manages all the Telefonica group's mobile operations throughout the world. It is one of the world's largest mobile telephony companies and leader in the Spanish- and Portuguese-speaking mobile telephony market, with an active customer base of over 52 million. The company reported net profit of euros 1.257 billion in 9M03, with a 28.4% increase in recurring profits. Telefonica Moviles' shares are traded on the Spanish and New York Stock Exchanges with the ticker TEM. About PalmSource PalmSource, Inc. is the company behind Palm OS, a leading operating system powering mobile information devices. Approximately 30 million Palm Powered handhelds and smartphones have been sold to date worldwide. Industry leaders Aceeca, AlphaSmart, Fossil, Founder Technology, Garmin, GSL, HuneTec, Kyocera, Lenovo, palmOne(TM), PerComm, Samsung, Sony, Symbol Technologies and Tapwave license Palm OS to create diverse mobile devices that meet unique customer needs. Palm OS has given rise to a large community of users, enterprises, developers and manufacturers, who together make up the Palm Economy. More information about PalmSource is available at http://www.palmsource.com/, http://www.palmsource.co.uk/, http://www.palmsource.fr/, http://www.palmsource.de/ and http://www.palmsource.com.cn/. Forward-Looking Statements This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Such forward-looking statements include, without limitation, statements related to, Palm Powered Mobile World Program; the features, functions and benefit of Palm Powered smartphones; and the emerging mobile market in Spain. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include, without limitation, our ability to successful execute our business objectives, including the objectives of the Palm Powered Mobile World program including to accelerate the availability and adoption, if at all, of Palm Powered smartphones in the Spanish market; our ability to maintain and continue to optimize the Palm OS platform to enable creation of Palm Powered smartphones that produce ARPU that is acceptable to mobile operators; the ability of the Palm Powered smartphones and Palm OS software applications to provide the anticipated results and benefits; the realization of the size of the mobile data market in Spain; our ability to maintain and grow the developer community; and the general economic conditions in the U.S. and abroad and other risks and uncertainties contained in our public announcements, reports to stockholders and other documents filed with and furnished to the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the period ended August 29, 2003 and November 28, 2003. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward- looking statements. Palm, Palm OS and PalmSource are registered trademarks of, palmOne and Palm Powered are trademarks of, Palm Trademark Holding Company, LLC. Other brands may be trademarks of their respective owners. DATASOURCE: PalmSource, Inc CONTACT: Laurie Spindler, Public Relations for PalmSource, Inc., +1-408-400-1924, or ; or Telefonica Moviles Espana, Press Office, + 34-680-01-86-00, or Web site: http://www.palmsource.com/ http://www.palmsource.co.uk/ http://www.palmsource.fr/ http://www.palmsource.de/ http://www.palmsource.com.cn/ http://www.palmsource.com/mobileworld http://www.empresa.movistar.com/

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