The Palm Pre: Final thoughts (for now)

By Angela Gunn | Published January 12, 2009, 10:01 PM

It could be here in five months; it could be here sooner. But even before the Palm Pre has a firm release date, there are a few datapoints and checkpoints you need to keep an eye on.

Dollars and demand. In the wake of CES, the pricing and supply picture is becoming clearer. At this point it's believed that the Pre will be priced at under $200 with a two-year Sprint contract and at either $399 or $499 without it. That's steep, sure, but not at all out of line for a high-end handset from Sprint (or anyone else).

The bigger question for some is whether the production will meet the insane hyp-...um, expected demand. Early reports put the initial production run at 200,000 handsets, all intended for the US market. To give you some point of comparison, Apple famously sold 1 million iPhones in the first 74 days of availability. It's hard for our tiny minds to conceive of fanboys queuing up for days in front of a Sprint store, but one wonders nonetheless if the manufacturing will be able to keep up with the demand.

App-y slappy? The jury's out on whether the anyone-can-play apps-development strategy is a winner -- and to whom it's directed. Some consumers profoundly loathe closed-garden apps stores such as those for the iPhone and the Sidekick; in particular, users of Symbian systems seem to have a gift for free-range software gathering. Palm's splitting the difference, offering a branded and curated apps store while ensuring that developers wise in the ways of HTML, CSS, and JavaScript are also able to build and offer apps separately.

But AR Communications senior vice president (and frequent Betanews contributor) Carmi Levy says that Palm can't afford to dilute its efforts out of the gate. "Palm's app store will have to be branded just as strongly as Apple has branded its offering. It's all well and good to allow third parties sufficient leeway to build their own offerings as they deem appropriate, but consumers don't have the capacity to remember the six different ways of getting apps onto their device. They want to remember one brand, one URL, on easily installable application."

Enter the enterprise buyers. Not that it hurt Apple to give the high hand to would-be corporate iPhone users for so many months, but it's not likely Palm has that kind of time, or that kind of brewing social capital, on its side. Friday's CES presentation didn't go into much detail on security, and no representative had news to give on VPN support -- two must-know issues for your hardworking IT department.

If Palm wants to open a two-front war -- Apple's iPhone on one side, RIM's BlackBerry on the other -- there's an entire marketing conversation that needs to happen between now and launch. Levy, however, isn't worrying: "For now, they've got a bit of time to put together a business-specific marketing strategy, so we'll wait and see how that evolves."

The induction charger on Palm's new Pre

Gee, GSM. Palm representatives told Betanews that the company's already talking to potential partners on the GSM side. Levy's glad to hear it: "It's encouraging to see that they've developed a roadmap for broader network capabilities."

But, he says, "The key lies in how quickly Palm will be able to ramp production of multiple versions of the device, and how quickly they'll be able to lock in different vendors in different markets around the world to ensure seamless availability of subsequent generations. The game is no longer based on the near-term success of any one device. Rather, it's based on the evolution of the platform over time, and Palm needs to be planting the seeds for that evolution -- and getting that message out -- now."

Our hands, they itch. To the person who e-mailed me demanding that I not leave Vegas without a Pre in tow: Yeah, right. Not only are review units not yet available, even the demo units reporters were allowed to see and touch aren't falling into our hands for any serious playtime. (One very high-profile journalist -- he writes a weekly column for that well-respected daily paper back East -- started to walk away from the Palm reps with the Pre in his hand and was immediately surrounded by Palm staffers, who in the nicest way possible made sure he walked no farther.)

In other words, we can now twitch and speculate all we like, but what reviewers will really be doing for the time being is scheming to get access ASAP. That footloose reporter is doubtless one of the 2-3 folks who'll have early access; the rest of us will agree to sign over our firstborn for hands-on time at Palm's earliest convenience. Such is the life of a gadget reviewer. (Pity poor me, yes.)

Investors will take stock. Just six weeks ago, Palm's stock price hit a new 52-week (and all-time low of $1.14; that was a couple of weeks after the previous new low ($1.65), which hit four days after the previous new low ($2.07). On Monday, the stock was trading at $5.91 and analysts at Citigroup were using terms like "potential to be iconic" and -- more to the point -- "hold" (not "sell"). Between now and launch, Palm has one earnings call in late March and, if they're delayed until late June, possibly a second.

Announcing months ahead of time also means that the company's committed to enduring a period of low sales for its current Treo and Centro lines, which will be a bite in the shorts for revenues. And no one needs to tell tech folk that the current economy holds no promises.

But Citigroup's not alone in thinking that it's all likely to work out for Palm -- Morgan Joseph on Friday upgraded its recommendation from "hold" to "buy," and Global Crown Capital moved its marker to the upgrade column as well, shifting its (curiously worded) rating from "underweight" to "overweight" after changing that recommendation on November 24 from "neutral" down to "underweight."

Comments

View comments by with a score of at least

looks a little round and bloated.
But then again it looks like the iPhone just wants to smash a break (fragile). Not the case I believe...

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I like Palm products and even the ancient Palm O/S, however, companies like RIM, Apple, Sony Ericsson have produced some very excellent phones, as it is designed to be a super MP3 player. I dislike the Apple iPhone however, the Blackberry Storm and Bold provide most excellent and solid service. Sony Ericsson has produced a very fine phone in its new Xperia X1, which in my mind right now is the one to beat.

Palm will have to present a phone that is really outstanding to beat the competition, and right now, I do not see the Pre as a lion killer.

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It looks to be a nice phone with a nice feature mix.

But as far as so many postulating as to whether it will be an iPhone killer, get your heads out of your posteriors!

With multiple millions already sold, the legions of iPhone uers are not going to abandon them! So you idiots are going to have to figure out where all of the new users will come from.

And the truth is that the market benefits by having a variety of competitive phones nd choices available. And it would be nice if a few more understood that and a few less market ignorant, emotional fanboys
speculated on their dream of the death of the iPhone - especially when everyone else is falling over themelves to copy the significant features of what they think is such a poor design!

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Why is no one b****ing about there being no SDK like they did for the iPhone when it first came out? The iPhone had a web browser as its development platform and got panned for it. This phone has fail written all over it, and Palm will die or get bought by Microsoft.

Another iPhone clone bites the dust.

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If you search your memory banks you might recall that the SDK for the iPhone came out 10 months AFTER the announcement of the iPhone. I am certain the SDK is in the hands of the right people at this time and that it will follow quickly after the announcement.

Remember, for developers to effectively create good and usable applications, they need to have hardware to test it on. I don't think Palm wants to hand out thousands of Pre devices in the hopes that applications come out at launch. The strategy here is quite sound because it will take time for this new platform to be adopted and tested.

Palm's death knell has been sounding for a long time and they continue to avoid both death and acquisition. The reason is based on the fact that while their products are a bit behind the time, they are still a quality product that works as designed. The look and feel has just become very old and tired.

The new WebOS looks very compelling and very good. Also, if the Palm notes are to be believed, the new device will provide a very simple development environment. Regardless, it is good for the market to have options besides Microsoft, Nokia, Apple and Google. We all win when choices are out there.

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How exactly do you pronounce "Pre?"

Is it "Pray?"

Or is it "P'ree?"

Or even "Pry" maybe?

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Hi Gregmir -- they were pronouncing it "pree," with the long E. And they were doing it consistently, which made me glad. (A good question!)

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Wow, not only was my question answered, but the author of the article answered it herself. Thank you so much for taking the time to read my comment :-)

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I'm skeptical of a price of $200(although I hope that it is). Since Palm's existence very strongly depends upon this device, and since they spent a fortune(and had to close stores) developing it, I'm thinking they're going to have to sell for $250 with a 2 year contract, at least to start(remember, the iphone started at $400?). Palm has very meager income from other sources. However, at the same time, it was shown that the Pre has a much more advanced processor and other high capabilities, such as turn by turn GPS, so I'm thinking they could argue the value exists for the higher price point. For the record, I hope I'm wrong.

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The analyst view is certainly an interesting albeit tainted view of the success of this device. Palm's fate is in their own hands and the success of the Pre is more based upon delivering a quality and quality device. It seems to me that if the Pre comes out the door plagued by issues and not living up to the hype generated, they will not catch the iPhone.

The real test will be the first 90 days once they ship. If the device lives up to expectations, you know that Palm will follow up with a variety of flavors. To me, this is what will impact the iPhone. With Apple, you get an iPhone (Generation, 1, 2, 3, etc.) Palm has traditionally delivered many different products with their OS. Those tailored to the youth and entry level (i.e. Centro) and those tailored to the business segment (i.e. Pro).

It is wrong to try to compare the Pre to the iPhone as this will not be where the fight lies. It will be a battle between the Palm's WebOS and the WinMo, RIM, Symbian and Apple platform. If Apple continues their flat market with a single device strategy and Palm delivers, the iPhone will lose its appeal.

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Solid piece, very intriguing. What nobody seems to understand is that the reason Palm is being so free with their app platform is because Apple is doing the opposite. Whatever the iPhone does well the Pre will obviously have to try and match, but Palm's main focus will be on delivering what the iPhone doesn't. That is how you create an "iPhone killer". Actually, I think those big-time analysts probably DO understand..not only because they know how this game is played, but most of them probably have iPhones.

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What you don't seem to understand is apple's closedness is why it is so successful. People love itunes and the ipod because it manages their music for them. People love apple hardware because it's tailored for coolness, not sloppiness. apple needs that control for quality control. If you don't have quality control, you get Windows Mobile, where apps are 10x the cost of iphone apps and 1/10 the functionality/fun PLUS make the WM device unstable.

Opening apps isn't enough to get mass adoption other than us geeks. sadly, geeks do not make up much of the cell/smartphone market.

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