Microsoft ( MSFT) is promoting an all-new PC design, but will anyone really care?

Formerly code-named Origami, the new design is for an ultramobile computer, or UMPC. The idea is to have a device with much of the same power and features of a notebook or tablet computer in about half the size.

The product represents only the latest effort by Microsoft to create a market for a new class of portable computers. Although notebook computers have seen enormous growth in recent years, the market for related products such as PDAs and tablet PCs has been limited at best.

Some analysts say the same will be true for the UMPC, at least in the near term.

"The technology could be neat, and it may make a difference in the future, but we are years away from a significant financial impact," says Charles Di Bona, a financial analyst who follows Microsoft for Sanford Bernstein, which does not do investment banking.

The UMPC concept faces a number of obstacles to mass adoption -- and to having a meaningful impact on Microsoft's results -- analysts say. Price, market perception, the lack of major vendor support at launch and the actual physical design of the device all could work against the concept, analysts say.

"There's potential there, but I remain skeptical," says Van Baker, a PC industry analyst at market research firm Gartner.

As sketched out by Microsoft, the typical UMPC device would have a seven-inch touch-sensitive screen, weigh less than two pounds, include a 30GB to 60GB hard drive and a built-in wireless networking antenna, and run on an Intel ( INTC) or Via mobile processor.

Unlike PDAs running Microsoft software, the computer would run a full version of Microsoft Windows. In addition to allowing users to enter data via the screen, some versions would also include a keyboard.

Buzz about the UMPC concept has been building for weeks, centered first on a enigmatic Web site devoted to the Origami project and then on a related announcement by Intel at its developers' conference in San Francisco this week.

Microsoft is slated to give more details Thursday at the giant CeBit trade show in Hanover, Germany.

With the PC industry maturing, both Microsoft and Intel have struggled recently to develop new markets for their wares -- and new catalysts for their stocks. While WinTel (a term denoting the close alliance between the two companies) competitors Apple ( AAPL) and Advanced Micro Devices ( AMD) have seen their stocks soar in recent years amid resurgences in their respective businesses, share prices at Intel and Microsoft have basically been in a rut since the dot-com bubble burst five years ago.

Who Will Buy?

Despite the hype, the UMPC likely won't lift them out of that rut anytime soon, analysts say. Price, they add, is perhaps the biggest initial problem for the UMPC platform.

When Microsoft CEO Bill Gates first started talking about a new class of portable PCs last year, his idea was to have devices on the market for $500 or less.

But the first generation of Origami computers, which will go on the market beginning next month, are set to sell at significantly higher price points, from about $600 to $1,000.

And the lower end of that range may be a bit misleading, in that consumers will have more options at the higher price points than at the lower ones, says Richard Shim, an analyst with the industry research firm IDC.

The UMPC idea is similar to the smart display variation on the tablet PC theme that Microsoft touted a number of years ago, say Shim. The idea then, like now, was to have a relatively simple, portable, personal device.

But smart displays never caught on because the price points were too high, he says. "This idea has always been popular one," Shim notes. "The limiting factor has always been if you can't sell it cheaply to the mainstream market, they're not going buy it."

But price isn't the only potential problem for the UMPC devices. Despite their logical appeal, all-in-one portable devices have typically struggled in the marketplace against devices that focus on doing a few things particularly well.

For instance, many portable devices from cell phones to PDAs can play digital music. But those multipurpose devices have done nothing to stop the outsized popularity of Apple's iPod, which is known first and foremost as a great music player.

Similarly, for the UMPC to succeed in the market, vendors are going to have figure out the best applications for the device and explain those to consumers, analysts say.

"There's a real danger of having this thing perceived as a small PC ... of getting too excited talking about all the stuff you could potentially do on this thing and not focusing on the things it could do well," says Rob Enderle, principal analyst at the tech industry consulting firm Enderle Group.

Gartner's Baker puts the problem a different way. "My initial reaction was that this is a tweener product. I've got a PDA. I've got a notebook. Why do I need something in between the two?"

Another possible impediment to adoption of the UMPC is the lack of vendor support. So far, only five vendors have publicly committed to releasing devices based on the new design, of which the only household name is Samsung.

Notably absent from the list are any of the major PC vendors, such as Dell ( DELL), Hewlett-Packard ( HPQ), Toshiba and Sony ( SNE).

H-P's absence is particularly noteworthy, given that it was one of the first vendors of both Tablet PCs and PocketPCs.

Representatives for both Dell and H-P declined to comment on whether they have UMPC devices in the works.

The lack of top-rank vendor support at launch "should be a concern," says Enderle. "You want as many people behind it as possible ."

To be sure, few analysts are ready now to completely write off the UMPC. The small design of the devices could appeal to some on-the-go consumers, says Gartner's Baker.

And some analysts say it could be a big hit -- if it's done right. Unfortunately, outside of Apple, the PC industry has a history of having good ideas undermined by their complexity, says Enderle.

"This platform could be next big thing, depending on how good a job it does," he says. "If it were coming from Apple, that would be a lot more certain."

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