Earlier this week we brought you news of Celio’s REDFLY Mobile Companion, a 1.9-pound device designed to synchronize with Windows Mobile-powered phones (via USB or Bluetooth) in order to provide a bigger screen and keyboard for maximizing productivity. Given that the only other true smart phone companion never made it to market, and that this product is identically priced, skepticism understandably abounds. But according to Celio CEO Kirt Bailey, the REDFLY is different. Of course, we asked him about the “F-word”, but also about how this CES Innovations 2008 Design and Engineering Award honoree works, its target audience, and how it stacks up against the new breed of standalone mobile Internet devices.

LAPTOP: How is the REDFLY Mobile Companion different from the Palm Foleo?
Kirt Bailey: The weakness we saw in other devices that have been announced was that they were completely new platforms. They had a processor and operating system. It really was a Linux notebook running on a processor. It was a completely new platform so new applications had to be written for that device. What we are doing is moving away from that and extending the smart phone as the platform. We are taking advantage of the smart phone operating system and the processor so there is no duplication of resources. The thousands of Windows Mobile applications can work on our device.

L: What does the device look like and when will it be available?
KB: What we have is a micro-laptop or notebook. It is 9 x 6 x 1 inches, it weighs less than two pounds. It also has an 8-inch LCD panel, a standard 80-key keyboard, and a touch pad. Connecting to the smart phone via USB or Bluetooth, we allow users to fully access the functionality of the smart phone and have a better experience using e-mail, accessing the Internet, and getting attachments. The REDFLY will cost $499 and it will be available in March. We’re in beta now.

L: How do you trick the smart phone into thinking its outputting to a larger display?
KB: That is the crux of the IP. Hundred of megabits per second of data are being transferred to the display. We have a proprietary compression algorithm in order to get that down to a good experience over USB or Bluetooth. The Bluetooth experience, because of its lower bandwidth, isn’t the same as USB. USB will work best for watching YouTube and video of any sort. We also change the resolution of what would be displayed.

L: How do you set up the REDFLY?
KB: There is a small driver we put onto the smart phone. Once the driver is on the smart phone you simply plug in a USB cord or hit a key on our keyboard and you are connecting. It takes a couple of minutes to install the software.

L: Who are you targeting initially?
KB: We are positioning the device for business users and enterprises. We want to make sure we give our customers a very good experience. We think we can go out to business and work with CIOs, and we can ensure they have a solid stack on the device.

L: Why not make a $400 device that runs Windows Mobile on its own?
KB: Our response would be to minimize the number of platforms. The ubiquity of the Smartphone is a key market factor. How do we make that communications device, which has good computing power, also the personal computing platform? It really is a Pocket PC; it just has some deficiencies. We think we have solved the deficiencies. All the things you might do on a larger Windows Mobile device like you have described you can do on the Pocket PC and limit the cost of ownership of having multiple platforms.

L: How is your device different from mobile Internet devices like the Nokia N810?
KB: Those devices are more single-function devices. We think that with the REDFLY partnered with the smart phone we can provide those single functionalities without having to buy a multiple of devices or platforms. One of the things we have done is really developed the REDFLY so that when you are on a one- or two-day trip you aren’t replacing your notebook. It’s just more convenient to have while you’re traveling.

L: Since Windows Mobile doesn’t yet support Ajax or Flash, do you think going to a bigger screen will be a letdown?
KB: The feedback so far has been that customers are thrilled with the functionality that we are providing and the fact that now they can actually access the Internet and websites and get a much better experience. Applications such as Salesforce.com do work very very well and are providing a good experience. And Microsoft continues to improve Internet Explorer Mobile.

L: Are you working on a second iteration of the REDFLY that has wireless USB?
KB: The beauty of our model is that we are dependant on the smart phone. So we are able to connect to the biggest wireless pipe that is out there.