John Paczkowski

Recent Posts by John Paczkowski

Palm: Spare Change for Financial Viability?

Is it too late for Palm? Elevation Partners doesn’t think so. The private equity firm has agreed to make an additional $100 million investment in the foundering smartphone maker, which last week reported an abysmal second quarter and its sixth consecutive loss. “We believe that Palm is in a position to transform the cell phone industry, and we are pleased to have the opportunity to make this additional investment in the company,” said Elevation Partners co-founder Roger McNamee. “Palm has an industry-leading team and an exciting, differentiated product roadmap. We are proud to be associated with the company and look forward to great things from Palm in 2009 and beyond.”

For Palm (PALM), which has lost two-thirds of its market value this year, the funds will help underwrite the cost of launching its new Nova operating system and the first line of products to run on it. For Elevation, however, which already holds a large stake in the handset maker, it seems more of a good-money-after-bad exercise–though neither Elevation nor Palm would ever admit it.

“There’s an enormous amount of opportunity left,” Palm CEO Ed Colligan said last week. “If you look at just the replacement market in this business, every year there’s phenomenal numbers of even just replacement devices, so the chance that there’s not another opportunity ahead or we can’t build a platform position here I think is not real. So it’s incumbent upon us to create really compelling products and a differentiated enough platform that people will recognize that and come to Palm. We have millions of users that recognize our brand of delivering them fantastic solutions over the years. We expect they will look to us again and we hope as feature phone users migrate to smartphones that we will get more and more of them as well.”

We’ll see. Palm shares are trading up some 32 percent on news of the Elevation investment.


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The problem with the Billionaire Savior phase of the newspaper collapse has always been that billionaires don’t tend to like the kind of authority-questioning journalism that upsets the status quo.

— Ryan Chittum, writing in the Columbia Journalism Review about the promise of Pierre Omidyar’s new media venture with Glenn Greenwald