Windows Phone Thoughts: HP Getting Into Handheld PCs Again?

It was a Handheld PC (the Philips Velo 1) that caused my interest in the world of Windows CE back when. And currently, next to my Pocket PCs, I still use a Handheld PC, the HP Jornada 720. Although the form factor is not that much about portability, I do like the fact that these devices have a bigger screen, a typable keyboard, a long lasting battery, and instant on functionality. For light computing tasks, my HP Jornada still beats my iBook. But apparently not too many people were thinking like me, since the Handheld PC market was forever shrinking and one after the other OEM dropped the HPC line. After the Jornada 728, so did HP. But currently Psion reports there's a lot of interest in their NetBook Pro(running Windows CE). And according to an article in Computer Business Review Online HP is considering their return to this market.

Speaking with ComputerWire on a recent visit to HP's Office of Strategy and Technology in Stockholm, Sweden, center director Niklas Johnsson said it was possible that HP would re-introduce such a device into its range as a result of changing market forces and the greater ease of adapting Microsoft's latest mobile operating systems to devices of different form factors.

The product lines of the handheld market seem pretty blurred nowadays. We have mobile phones that are behaving like PDAs, we have PDAs that are behaving like mobile phones, we have PDAs that behave like mini-notebooks, we have mini-notebooks that come in a PDA format. What do you think? Is there room for the Handheld PC in this strange market?