Yesterday morning while still in bed I rolled over to check on the markets via my BlackBerry and discovered that palm was down 20% on the day. As a Palm shareholder, I nearly flat-lined. Not really, but I wasn’t experiencing positive emotions either. I quickly clicked over to Bloomberg Mobile to discover they essentially cut their forecast for the whole year. It doesn’t get much worse than that.
The sad thing is that as confident as I was that Palm was a good company to invest in, I wasn’t surprised. Palm gets no love. They were buried on Sprint where they were left for dead and their attempt to crawl from under the rock is going to be tougher than I realized. As terrible a business decision as it was, I kind of see why they were in an exclusivity deal with Sprint now.
All Verizon cares about is selling Blackberry and Android devices. AT&T is focused on Blackberry and iPhones. They must have figured they should give themselves a chance as a headliner at Sprint, who has no iPhone to sell and is always last to receive any type of Blackberry worth buying. In theory it sounds pretty good. If only Sprint wasn’t a useless network with a regression of subscribers similar to print media, it probably would have worked.
Nobody is buying the new Palm Pre and Pixi. But the truth is they are really good devices. Better in my opinion than any Android, or Windows Mobile device. And if I was being perfectly honest they are also better than many of the mid to low end BlackBerry models. In fact I consider the Pre on the same plane as the BlackBerry Bold and iPhone, as good as it gets.
It was this confidence in their devices that made me believe that multiple carrier distribution would be enough to bring the company back. Such a high quality product has to count for something right? Maybe it will bring them back in a year. After they reach AT&T and introduce perhaps a new device on top of the two they have out right now. But the road to recovery is looking bumpier than ever. So bumpy that it wouldn’t surprise me if they can’t recover at all.
If great phones and the biggest carriers don’t turn things around then I expect Palm will start formulating a strategy to allow the company to keep going in some capacity. A possible buyout is already being rumored. Nokia, which holds the world lead in phone market share is reported to be interested.
While I am a dedicated BlackBerry user, I am rooting for Palm. I think the market needs their quality products to keep competition in top form. As for being a shareholder, I had to sell off before this terrible situation got worse. It doesn’t mean it’s not on the watch list though. But I can’t see the bottom right now and that is too scary to deal with. When they stabilize and present their new strategy I will be all ears. In terms of upside I believe theirs is potentially greater than Research In Motion. But like a world class athlete, undeveloped talent equates to what could’ve been. And what could’ve been doesn’t equal success.