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Jon Rubinstein Joins Board of Qualcomm, as Mobile Chipmaker Ups Its Silicon Valley Cred

Kara Swisher — Mon, 06 May 2013 20:05:12 +0000

According to sources close to the situation, well-known tech exec Jon Rubinstein will be joining the board of Qualcomm, the San Diego-based chipmaker that has gotten a big boost of late for its role in the explosion of mobile devices.

Rubinstein is an interesting and logical choice for Qualcomm, having been a high-profile player for a long time in the mobile space, beginning with his work on the iPod while at Apple. After he left his last job at Hewlett-Packard last year, though, he has been very low-key.

(Update: Qualcomm confirmed the appointment in a press release.)

For Qualcomm, the selection of Rubinstein to join the board is something to watch, as he is the second exec from Silicon Valley to be tapped by the company recently. In March, Qualcomm hired tech investor Laurie Yoler as SVP of business development, making her “responsible for augmenting existing business relationships in Silicon Valley, as well as developing new strategic business opportunities for Qualcomm in the region.”

Rubinstein has even more experience here and is also familiar with a range of mobile efforts over the years, some of which were successful and others not so much, from his work at Apple, Palm and then HP. He is also a board member of Amazon.

Aside from CEO and Chairman Paul Jacobs, Rubinstein — who has degrees in electrical engineering and computer science — will be the most technically experienced director on the 11-person board.

Qualcomm declined to comment.

Here’s a nice primer on Rubinstein by Arik Hesseldahl, in a report on his leaving HP early last year:

Best known for his work on Apple’s iconic iPod music player, Rubinstein left Apple in 2006 and joined Roger McNamee as a partner in the private equity firm Elevation Partners, following its 2007 investments in Palm.

In 2009 he replaced longtime Palm executive Ed Colligan as its CEO, and oversaw a dramatic restructuring of the company’s products, including a significant rebuild of its smartphone operating system. Gone was the legacy PalmOS that had been used in so many popular devices like the Treo that for a time competed seriously against Research In Motion’s BlackBerry.

PalmOS was replaced by WebOS, which first appeared on the Pre smartphone, then later on the Pixi and Veer devices. After HP acquired Palm, WebOS was also used on the abandoned TouchPad tablet, and is now an open-source operating system overseen by HP.

Rubinstein’s departure is no big surprise. Sources said he hadn’t been seen at HP’s offices following the decision by former CEO Léo Apotheker to get out of the business of making WebOS-based hardware. His future plans have been the subject of speculation for some time.

After HP decided to exit the WebOS hardware business, Rubinstein was assigned to a vaguely described “product innovation role” within HP’s Personal Systems Group during a management shakeup last July. It was an unusual move and one made with little explanation at the time. But sources say it was a preface to Rubinstein’s departure, one intended to lessen its PR impact when he finally left. “That ‘innovation’ gig he was given in July was his first step toward the exit,” said one source, a former Palm exec with close ties to Rubinstein.

History Repeats Itself at Hewlett-Packard webOS Unit

Arik Hesseldahl — Tue, 06 Sep 2011 14:00:42 +0000

History, it is often said, has a funny way of repeating itself. So it appears to be at Hewlett-Packard with regard to its webOS business.

HP has announced to the world that it plans to stop selling its TouchPad tablets and other hardware running the webOS software it got after spending $1.2 billion to acquire Palm last year. Yet it wants to keep the webOS software, guessing, perhaps correctly, that there’s some revenue-generating business to be made of it yet, maybe in patents. Meanwhile, the hardware side of webOS is, after disappointing sales, being shut down, just maybe to be reanimated under the umbrella of the soon-to-be spun out PC business. And it’s building one last run of the heavily discounted TouchPad, to rid itself of parts it has already paid for. It’s complicated!

As it happens, a pair of internal HP memos — which were leaked to PreCentral.net, a site devoted to the Pre, the first smartphone to run webOS — appear to outline how the webOS split is going to go down.

According to the memos, the webOS software business — that is, the bit that HP still wants — is being moved inside HP’s Office of Strategy and Technology, or OS&T, which is headed up by Shane Robison, HP’s executive vice president and chief strategy and technology officer. One of the two memos was written by him.

And what of the webOS hardware group? It will remain within the Personal Systems Group, which is HP’s formal name for the personal computer business it says it wants to spin off as a separate company.

It’s not the first time that the hardware and software halves of what used to be Palm have been split into separate entities. Students of the history of Palm well remember the strange odyssey that began in 2002, when Palm — less than two years after spinning out of its prior parent, 3Com — split into two companies: A hardware company called PalmOne, and a software company called PalmSource.

The idea was that the two halves of the business had different agendas. The software business saw opportunities in licensing the PalmOS to numerous hardware manufacturers. In time, several companies took out licenses: Handspring, launched by Palm’s original founders Jeff Hawkins and Donna Dubinsky, was the original licensee, and others followed. Sony made a bunch of handhelds sold under the Clie brand; IBM sold something called the WorkPad; Garmin made a GPS-enabled PDA that could also help keep you from getting lost. Eventually a company called Access bought it and still operates it to this day.

Meanwhile, the hardware business soldiered on under the name PalmOne. In 2003, it acquired Handspring, bringing back its original founders, and in 2005 it bought back the rights to use the Palm name. Then, in 2007, came the big investment from Elevation Partners, the creation of webOS and, well, you know how that turned out.

Apple Tops J.D. Power's Smartphone Survey for Fifth Time

John Paczkowski — Fri, 18 Mar 2011 17:05:23 +0000

The iPhone has again topped J.D. Power and Associates’ semi-annual smartphone customer satisfaction survey.

For the fifth time in a row.

The iPhone scored 795 out of 1,000 possible points–-5 fewer than it claimed last year, but still more than those awarded to its closest rivals, Motorola and HTC, which scored 763 and 762, respectively. And its score far exceeded the industry average of 761.

Sadly, the same cannot be said for those of Palm, Nokia, Samsung and Research in Motion. All four companies’ smartphones posted below average scores in customer satisfaction, whose key factors include ease of operation, operating system, physical design, features and battery function.

Ranked dead last: RIM, which surpassed all three of its low-scoring rivals just 6 months ago.

What's In Store for Technology in 2011

Walter S. Mossberg — Thu, 30 Dec 2010 02:03:49 +0000

It has been a big year in personal technology, from the debut and early success of Apple’s iPad, to the rise and continuous improvement of Google’s Android smart phone platform, to the continued surge in social services led by Facebook and Twitter.

[ See post to watch video ]

So I thought I’d take a look at the challenges and opportunities facing some major players in consumer tech in 2011. As with all my columns, this one is focused only on products and services provided directly to consumers, rather than to businesses. Also, as usual, this column isn’t meant to offer investment advice or to evaluate the management skills or financial condition of companies. It is a look at the products and competitive positions of the key contenders as they enter the new year.

Apple: Coming off a highly successful 2010, in which it introduced a new category of portable computer—the multitouch tablet—and sold millions of the product, Apple will have to withstand an onslaught of competitors by wowing consumers again with the second version of the iPad. At the same time, it will have to make a widely expected transition for the iPhone from a single carrier in the U.S., AT&T, to a second, likely Verizon. This could present a new opportunity to reach lots of new customers, but the sleek phone will have to work well on different network technology. At the same time, Apple will be hoping its planned new Macintosh operating system, Lion, can preserve the surprising momentum of the high-priced Mac, which the company is trying to enhance with certain iPad-like features, such as an app store and longer battery life.

Apple’s iPad will face an onslaught of competition in the coming year.

In 2011, Apple also is likely to try to address two areas where it has been weak: cloud computing and social networking. Both its MobileMe cloud service and its Ping social network had rough starts, and MobileMe charges $100 a year for services others give away. Apple is so popular, it has a huge opportunity to link users of its family of devices and of iTunes via the cloud and social networks, but it will have to aim higher and execute better. The second area where it likely hopes to improve is in the living room. The new, cheaper Apple TV is selling better than its predecessor but still lacks much Internet content. To break through, Apple will have to strike landmark deals with media companies.

Google: The search giant, also riding high, is now in so many product areas it competes with nearly everyone. In its core search business, it must focus on fending off a surprisingly strong challenge from Microsoft’s Bing by giving consumers more attractive, actionable results. Its Android operating system is a big hit, but still isn’t as polished or easy to use as the iPhone’s software, and even a Google official admitted it is still “an enthusiast product for early adopters.” One big test will be the forthcoming Honeycomb version of Android, meant for tablets that challenge the iPad.

A separate group at Google will try in 2011 to revolutionize the PC operating-system business and muscle in on incumbents Microsoft and Apple. Its new Chrome OS will power notebooks that essentially act as Web browsers, and run programs stored in the cloud, not on a hard disk. They also store all your files in the cloud. We’ll learn in 2011 how many consumers are comfortable with that approach.

Google also may take another whack at social networking, where it hasn’t made much of a dent after its Buzz service failed to take off. And it will have to rework its overly complex Google TV effort to bring Internet video to the living room.

Microsoft: The software giant still generates strong consumer loyalty with its older products, like Windows and Office and Xbox, all of which have had updates in the past year or two. But it faces big challenges in two hot areas: smart phones and tablets. Its new Windows Phone 7 platform has some nice design features, but also some missing capabilities that need to be addressed. Initial sales seem respectable, but will have to accelerate to get Microsoft back in a game it once led. The company also is a long way from the 300,000 apps available for the iPhone or the 100,000 for Android.

In tablets, Microsoft is hinting that a new version of Windows is being designed with a tablet focus to complement its PC focus. That product can’t be too late, given the rapid rise of the iPad and the many planned Android and other tablets for 2011. One golden opportunity Microsoft has is to expand the reach of its brilliant Kinect technology for games to other forms of computing. This system can recognize individual users and interpret gestures without the use of a controller device.

Meanwhile, Microsoft hopes to seize on a surge in concern about privacy to help keep its diminishing lead in browsers by building new privacy features, unavailable so far in other browsers, into the 2011 version of Internet Explorer.

RIM: The BlackBerry maker had a good 2010 in some ways, though sales were propped up by two-for-one giveaways, and consumer surveys show enthusiasm fading for the iconic smart phone. It needs a radically new user interface to keep up with iPhone and Android, and a lot more third-party apps. But it can’t afford to alienate its fan base. The company has an answer: a new software platform called QNX, but is vague on when that will show up on the BlackBerry. For 2011, RIM’s big move will be a new QNX-based tablet, the PlayBook, which looks speedy and highly attractive in the limited demos RIM has provided. What isn’t clear is how much the PlayBook will be aimed at consumers, as company officials have consistently stressed its appeal to businesses.

HP: The technology behemoth’s laptops and printers have proved popular with consumers. But it hasn’t had any real presence in smart-phones, tablets or consumer cloud services. To solve the problems, in 2010 HP bought innovative but struggling Palm, whose smart-phone operating system, webOS, and phones, the Pre and Pixi, got good reviews but sold poorly and didn’t attract many third-party apps. In 2011, HP hopes to use its ample money and talent to revive webOS with new phones and tablets to challenge Apple and Android. A successful Palm re-launch, with the new initiatives from RIM and Microsoft, would be good for consumers by providing more choice and competition. HP also hopes to boost home printing with a new line of printers that can print anything emailed across the Internet and wirelessly print from Apple’s hand-held devices.

Facebook and Twitter: The twin leaders in social networking were red-hot in 2010, attracting vast numbers of users. They have huge opportunities for further success, but face challenges. Smaller services, like social-coupon company Groupon, continue to emerge with new social and community ideas consumers like. Apple and Google could be big headaches if they get social right in 2011. Facebook must continue its recent initiative to let members share personal details with more limited groups of friends, and to find ways to make money while offering more privacy, which has been a thorn in its side. Twitter is on a mission to get more than an active minority to post, while convincing people it is a valuable way to keep up with news and opinion even if you never post.

Despite the poor economy, the consumer-tech companies continue to show vibrancy, innovation and success. But every year brings challenges and surprises, and 2011 promises to be another fascinating ride.

For all of Walt’s columns and videos, go to the All Things Digital site, walt.allthingsd.com.

Write to Walter S. Mossberg at walt.mossberg@wsj.com

Myte, Gyst and Veer: Who's Doing Palm's Branding, Chaucer?

John Paczkowski — Fri, 17 Dec 2010 16:12:38 +0000

Companies often file trademarks on brands that they never end up using, so this trio of USPTO filings, made by Hewlett-Packard on December 10 isn’t exactly remarkable. But it is interesting in that the marks for which the company has applied–”Gyst,” “Myte” and “Veer“–sound suspiciously like the names of Palm products.

Certainly it doesn’t take a big leap to imagine Myte as a name for the the next iteration of the Palm Pixi, which is rumored to be smaller than its predecessor–perhaps even “the smallest smartphone ever.”

And Veer and Gyst? Who knows. Maybe HP’s branding team has been reading a bit too much Chaucer lately.

Palm Boss Jon Rubinstein: We Still Have a Chance to be a Major Player

John Paczkowski — Tue, 07 Dec 2010 22:50:07 +0000

When Palm CEO Jon Rubinstein last appeared on the D stage in 2009 he was bringing the Pre to market in a bet-the-company move to recover the handset maker’s long-lost glory. Palm’s new operating system, webOS, had been well received at the Consumer Electronics Show earlier in the year and the company’s share price had ascended from $3 to $10 on its promise.

Two years later, Palm no longer has a share price, having been acquired by Hewlett-Packard, and Rubinstein, no longer its CEO, runs HP’s new mobile devices unit. But with the iconic Silicon Valley company backing it and “doubling down on webOS” and a new tablet based on the OS headed to market, its future is perhaps equally as promising, if not more so.

2:57 pm:
The session kicks off with video of a previous interview with Rubinstein in which he–the “father of the iPod”–claimed never to have used an iPhone.

So, have you touched an iPhone yet? Kara asks.

Rubinstein laughs. “Oh, we’re going to go through this again? Have I used one as my own device? No. Have I touched one? Yes.”

2:58 pm: Rubinstein continues: For me personally, we have lots of people who use iPhones and we have competitive analysis groups who review competing products, but I don’t want to be tainted by another experience. I want to come at this with a fresh perspective and I think what we’re seeing now in this industry is that everyone is copying the iPhone.

3:00 pm: Sorry, we’re having some connectivity issues here….

Moving on now to Palm and its ultimate acquisition by HP.

I think we did have many of the elements to be successful. We had a great team, a great product, a great product pipeline….But I think the market moved too fast and when we looked forward we saw a very clear way to where we could get the company to profitability, but we didn’t see a way to get it to scale….We could have been a small, successful company, but I don’t think that’s long-term sustainable in this business.”

So it was an issue of scale and not the “creepy lady marketing?” Kara asks.

Rubinstein says no, though he concedes the Palm Pre could have been marketed better.

3:04 pm: Ultimately, says, Rubinstein, we just ran out of runway…. We looked at a variety of different alternatives, and at the end of the day we decided that the best thing to do was to hook up with a partner that could get webOS to scale….The most expeditious outcome was to partner with HP.

3:05 pm: What other companies were interested in acquiring you? Kara asks. Rubinstein won’t say. What he will say is that the one that made the most sense was HP. “They didn’t have a great mobile strategy, but they had the means to get webOS to scale….A company like HP needs to be in control of its own strategy….This is not ‘game over.”

3:07 pm: How badly did HP need Palm? “Look,” says Rubinstein, “HP is the largest computer company in the world…it needs a mobile strategy. And it needs a mobile OS of its own….They needed to be in this space, and now they’re very jazzed about webOS.

3:08 pm: How about the Mark Hurd scandal? Was it much of a distraction for Palm? Rubinstein says it wasn’t. Palm was relatively new to the company when it occurred and was thus unaffected. “There was some turmoil for a few days,” he says. “That’s about it.”

3:10 pm: Moving on now to Palm’s role within HP. “What we chose to do as part of the acquistion was to integrate part of Palm into HP and keep part of it separate….The engineering team is essentially separate…things like HR and finance are handled by HP….From my perspective, what we were planning on doing and what HP wanted to do were very well aligned.”

Post acquisition, says Rubinstein, as soon as we aligned our road maps, we were off and running. He notes that internal relationships with divisions like HP Labs have been quite helpful.

Will the Palm name continue? asks Kara.

[Sorry, more connectivity problems.]
Rubinstein: That’s something we’re debating. What do you think we should do?

Kara: Get rid of it.

Rubinstein: Okay [jokingly]….I don’t really have much of a connection to the Palm brand.

3:16 pm: What’s Rubinstein’s view on the competitive environment? “Look, this is a huge market. The growth is phenomenal. If we roll back three years to when I started this Palm adventure, mobile was the place to be. And it still is today. I think we still have the chance to become a major player if we do the right things.”

3:20 pm: What’s the more important device, the phone or the tablet? asks Kara. Rubinstein says he doesn’t think people will have just one device. “It used to be that people shared a device. These days, people have multiple devices. So the new question is how do these devices interact so there’s a seemless user experience across devices….The ability to have a unified experience on all your devices is very important.”

3:21 pm: The conversation moves on to carrier relationships. Rubinstein observes that AT&T is doing pretty well in the Bay Area. “Just for you,” quips Kara.

3:23 pm: And on to the Q&A. First question from Engadget’s Josh Topolsky. What’s the Palm story that’s going to make people buy your phones? How do you convince a consumer to buy your stuff when you’re competing with the likes of Google and Apple?

Rubinstein: We really do have a unique experience compared to everyone else….The other concept around this is the connected device strategy. We’re in this transition now where we’re integrating into HP, so we’re still ramping up.

3:25 pm: Kara circles back, asks about differentiation and how HP can break through all the marketing noise. Where do you think the next radical change in the mobile market is going to come from? she asks.

I think it’s going to be incremental change, not a radical. I think it’s all about bringing this vision of a more connected world to our users.

Kara asks about forthcoming webOS devices.

Rubinstein gives the standard answer: “Stay tuned.” But he added, “This will be a very different conversation next year.”

3:25 pm: And that’s it.

Palm Handsets Priced to Pwn

John Paczkowski — Tue, 04 May 2010 10:16:04 +0000

Remarking on slowing sales of the Pre in August 2009, Pali Research analyst Walter Piecyk suggested that Palm (PALM) and Sprint (S), its sole carrier partner at the time, would be wise to drop the price of the device to 99 cents and put it in the hands of as many customers as possible before it lost the little differentiated advantage it had.

Piecyk’s advice went unheeded–until recently. Now with Palm’s fate settled after its acquisition by Hewlett-Packard (HPQ) last week, the handset maker’s smartphones have become bargain-bin fare.

Last week also saw Sprint giving away the diminutive Pixi free to anyone willing to sign a two-year contract. This week, Verizon (VZ) is following suit with steep discounts of its own. The carrier has begun offering the Pre Plus and the Pixi Plus for just $29 with a new two-year contract. That’s $120 less and $60 less than the prices at which the devices debuted in January.

It’s also $28.99 more than Amazon’s price.

That’s right, the next-generation versions of the phone former Palm CEO Ed Colligan once described as a “significantly better product” deserving of a higher price than Apple’s (AAPL) iPhone is selling for a penny at Amazon (AMZN). Which is a great deal, particularly since both devices are being offered with free 3G Mobile Hotspot service. Sadly, the offer comes a bit too late to make much of a difference for Palm.

PREVIOUSLY:

Palm's Pixi: Soon to be a Great Happy-Meal Prize

John Paczkowski — Mon, 26 Apr 2010 14:42:45 +0000

Here’s one way for Palm (PALM) to get rid of the 197 days of inventory it reportedly hasn’t been able to move off the shelves: a free-with-2-year-contract deal. That’s what Sprint’s (S) done with the Pixi, the Palm Pre’s underpowered sibling. The offer is currently good at the carrier’s online store only, but I suspect it will soon extend to its brick-and-mortar outlets as well. Given Palm’s aforementioned inventory problem and recent news that retail partners like Radio Shack are phasing out its poorly selling smartphones, it was only a matter time before we saw the zero-dollars-on-contract-scheme come into play here.

RadioShack Dumping Palm? [UPDATED]

John Paczkowski — Mon, 19 Apr 2010 13:15:33 +0000

For Palm, April is indeed proving to be the cruelest month. It began with reports that the company is for sale and continued with news of the departure of software chief Michael Abbott. Now comes another ugly development: RadioShack appears to be dumping the company’s smartphone line. The Palm Pre and Pixi have disappeared from the retailer’s Web site and from the shelves of many of its stores.

As of this writing, RadioShack’s Palm Store is entirely empty (“What are you shopping for in our Palm Store?” “Nothing!”). And CL King analyst Lawrence Harris reports that a number of RadioShack locations are no longer stocking the Sprint (S) version of the Pre and Pixi.

“Over the weekend we visited multiple RadioShack locations in the New York metro area,” Harris writes. “Most were no longer carrying the Palm Pre or Pixi. One location still had some Pixi’s, but no Pre’s in stock. The store manager told us that sales of the Pixi would be limited to the stock on hand, with no further shipments expected. Historically, RadioShack has been an important sales channel for Sprint. In recent weeks RadioShack was offering both Palm models for free, probably in order to clear out inventory.”

I’ve asked both Palm (PALM) and RadioShack (RSH) for comment and will update here if and when I’m given one.

UPDATE: Wendy Dominguez, corporate media relations manager for RadioShack, just provided me with the following comment: “For competitive reasons we don’t comment on inventory numbers and distribution of specific devices. Palm has been a good partner. We expect that relationship to continue.”

Dominguez declined to explain why Palm devices are no longer available for sale in RadioShack’s Palm Store. Nor would she comment on reports that the Palm Pre and Palm Pixi have disappeared from a number of the company’s brick-and-mortar locations.

UPDATE: Palm has declined comment.

UPDATE: Sprint has confirmed to Tech Trader Daily that it is indeed phasing out sales of both the Palm Pixi and Pre. “The plan is for the Pre to be replaced by a BlackBerry device and the Pixi for a message-centric device,” a spokesman told the blog.

FURTHER READING:

Palm: I Cast Thee Out Creepy Lady Ad Agency

Palm’s Worst Nightmare: New iPhones on AT&T and Verizon

A Palliative for Palm

Good Luck Competing on the iPhone’s Home Turf, Palm

Exercise in Futility? Palm Pre Plus, Pixi Plus Headed to AT&T

Palm: Pssst. Wanna Buy 1.15 Million Smartphones?

Palm Pileup: Weak Smartphone Sales and a Gruesome Q4 Forecast

Could Be Worse, Could Be Raining: Palm’s AT&T Launch Delayed?

Could WebOS Licensing Be Palm’s Salvation?

Palm’s Salvation? Less Push, More Pull.

And if Palm’s Project JumpStart Doesn’t Work Out, There’s Always “Project Defibrillator”

Double Face-Palm: Analysts React to Palm’s Lowered Guidance

Time to Start Looking for a Buyer, Palm?

2010: Year of the Palm? Maybe Not…

Analyst: Palm May Be Acquired in the Next Two Years

Verizon's Palm Pre and Pixi Prices Officially INSAAAAAAANE!

John Paczkowski — Thu, 01 Apr 2010 18:59:20 +0000

Verizon has a solution to Palm’s (PALM) daunting inventory problems: Dramatic price cuts on the company’s webOS smartphones.

The carrier is now selling the Pre Plus, which debuted on its network in late January at $149.99, for $49.99. And the company has dropped the price of the Pixi Plus to $29.99 from $99.99.

Substantial discounts, even more so because Verizon (VZ) is offering a buy one/get one free deal for both devices. And, on top of that, the carrier is now offering its Mobile Hotspot service, which transforms the smartphones into Mi-Fi-style hotspots for free.

Inventory purge, anyone?

Hudson Square Research Launches Palm at Hold, RIM at Buy

Eric Savitz — Tue, 30 Mar 2010 20:00:36 +0000

Hudson Square Research analyst Daniel Ernst today launched coverage of both Palm (PALM) and Research in Motion (RIMM).

Ernst started coverage of Palm with a Hold rating, asserting that without a dramatic shift in demand, the company will run out of cash by the end of its May 2011 fiscal year. He notes that despite critical praise for WebOS, “neither the Pre nor its sibling the Pixi has found commercial success.” That said, he still things the company should attract significant interest from strategic buyers, whether from handset makers using third-party software or from PC makers seeking to make a move into handsets.

Read the rest of this post on the original site

Palm's Worst Nightmare: New iPhones on AT&T and Verizon

John Paczkowski — Tue, 30 Mar 2010 17:54:10 +0000

The debut of a fourth-generation iPhone this summer and, later, a second version of the device designed for use on CDMA networks like those operated by Verizon, will be great news for Apple, AT&T and, potentially, Verizon. But it doesn’t bode well at all for Palm, which has already seen strong competition from the iPhone and new Android devices like the Droid undermine sales of its Pixi, Pre and their “Plus” successors.

Going head-to-head with the iPhone 3GS on AT&T will be difficult enough for Palm (PALM). Competing with the smartphone’s souped-up successor on AT&T (T) and perhaps Verizon (VZ) could be disastrous.

The Apple (AAPL) iPhone has been AT&T’s hero device since launch, and that’s not going to change anytime soon. Said a company spokesman: “The iPhone will be an important device for us for quite sometime.”

The Pre Plus and Pixi Plus less so, I imagine. It’s a safe bet that the same will be true of Verizon if the carrier adds the iPhone to its lineup. Analysts mulling the consequences of such a deal say that pent-up demand for the iPhone on Verizon’s network could result in a massive burst of iPhone subscribers for the company.

One scenario put forth by Bernstein Research this morning suggests Verizon could stand to gain 6.4 million new iPhone subscribers in 2010 alone, many of them existing Verizon subscribers upgrading to the iPhone. Which would obviously leave fewer subscribers to upgrade to Palm’s devices.

That leaves Palm in a position that’s arguably worse than the one it found itself in when its devices debuted on Verizon, a position it blamed for its lousy third quarter. “If we could have launched at Verizon prior to the Droid, I think we would have gotten the attention the Droid got,” Palm CEO Jon Rubinstein said at the time.

But as I noted last week, Palm did not launch prior to the Droid. And now the company is launching on AT&T just as the carrier presumably prepares to introduce a new Apple iPhone (iPhone HD?).

Now it’s looking like all the hard work Palm did to evangelize its webOS phones at Verizon could be overwhelmed by the deluge of interest almost certain to accompany a Verizon iPhone.

Which leaves Palm in a vulnerable position, indeed. CEO Rubinstein claims Palm should have gotten the attention garnered by Droid. Will he make similar claims if Palm suffers further woes from a next-generation iPhone on AT&T–or a brand new one on Verizon?

FURTHER READING:

A Palliative for Palm

Good Luck Competing on the iPhone’s Home Turf, Palm

Exercise in Futility? Palm Pre Plus, Pixi Plus Headed to AT&T

Palm: Pssst. Wanna Buy 1.15 Million Smartphones?

Palm Pileup: Weak Smartphone Sales and a Gruesome Q4 Forecast

Could Be Worse, Could Be Raining: Palm’s AT&T Launch Delayed?

Could WebOS Licensing Be Palm’s Salvation?

Palm’s Salvation? Less Push, More Pull.

And if Palm’s Project JumpStart Doesn’t Work Out, There’s Always “Project Defibrillator”

Double Face-Palm: Analysts React to Palm’s Lowered Guidance

Time to Start Looking for a Buyer, Palm?

2010: Year of the Palm? Maybe Not…

Analyst: Palm May Be Acquired in the Next Two Years

Desert Palm

Nitrozac and Snaggy — Mon, 22 Mar 2010 19:00:48 +0000

Palm: Pssst. Wanna Buy 1.15 Million Smartphones?

John Paczkowski — Fri, 19 Mar 2010 21:33:52 +0000

“Obviously, we’re disappointed in our sell-through and we’re working very aggressively right now to resolve that. … We’re working closely with all of our carrier partners and our future partners. … We want to make sure that the point of sale is well trained. So step one is to make sure that we can get in with the point of sale. Remember, webOS is a brand new operating system. And it takes a while for the people in the stores to get accustomed to something new.”

– Palm CEO Jon Rubinstein

Palm shipped 960,000 smartphones during its third quarter–23 percent more than in the previous quarter. Too bad the company sold fewer than half of them, because now, on top of all its other woes, Palm (PALM) is developing an inventory problem, a nasty one, too. Looking over the company’s latest financials, Morgan Stanley (MS) analyst Ehud Gelblum puts Palm’s total channel inventory at an “alarming” 1.154 million devices.

That’s 197 days of inventory Palm hasn’t been able to move off the shelves.

Gelblum figures that even if Palm reduces its channel sell-in in its fourth quarter and manages to boost sell-through from 408,000 devices to 575,000 devices, the company will end up with a full quarter’s worth of excess inventory at the end of May.

That’s just gruesome. And as hard as Palm is striving to improve sell-through, it’s not likely to improve any time soon. Says Gelblum: “We expect Palm’s new in-store initiatives and better advertising to improve sell-thru, but excess inventory, which we estimate at 882k units or nearly 197 full days of inventory likely weigh on new device shipments and thereby revenue for several more quarters.”

Adding detail, Gelblum paints a challenging picture. “With channel inventory levels sky high, cash burn going well north of $130-150M next quarter and both a new Android phone and likely a new iPhone model all hitting store shelves in the spring and summer timeframe, we see little way numbers could begin to move back up again until at least the end of the calendar year at the earliest.”

How can Palm drag those sky-high inventory levels back to earth? Perhaps a price cut like the one inspired by its 2001 inventory glut?

Palm Running Out of Time–Again

John Paczkowski — Fri, 19 Mar 2010 14:14:15 +0000

Remarking on Palm’s gruesome third quarter during an earnings call yesterday, CEO Jon Rubinstein called the company’s performance “extremely disappointing to me personally.” This sentiment seems to be widely held among investors, who are dragging the company’s shares through the mud today–at $4.66, Palm is down 17.52 percent as I write this–and among analysts questioning whether Palm can ever pull off the turnaround for which it’s striving.

Analysts issued a handful of research notes on the company this morning and they are all viciously negative. The headlines proclaim that Palm’s brand value has collapsed, its financial performance is a disaster, and its execution missteps in a business as competitive as the mobile market have left its prospects dubious.

Over at Canaccord Adams, Peter Misek essentially threw in the towel on the company: “We believe that Palm’s troubles will only accelerate as carriers and suppliers increasingly question the company’s solvency and withdraw their support,” he wrote.

“With what appears to us to be roughly 12 months of cash on hand, an accelerating burn rate, a complete lack of earnings visibility, and substantial debt and preferred equity,” Misek added, “we no longer see any value in the company’s common equity. As such, we are reiterating our SELL recommendation and reducing our target to US$0.00 (previously US$4.00).”

Then there was this from Kaufman Bros. analyst Shaw Wu: “While we believe PALM has some value with its webOS and tight integration of hardware and software, we are unsure of the company’s prospects as an ongoing concern.”

And this from Morgan Keegan analyst Tavis McCourt: “It is certainly looking less likely that Palm can execute this turnaround on its own, but the company has at least one more chance with new hardware later this year to try and create some real consumer demand for webOS.”

And finally, this from Needham and Company’s Charlie Wolf: “Palm appears to be in a no-win situation. The company could invest even more in marketing the Pre and Pixi. But it’s unclear whether Palm could ever spend enough to reach a position where Pre and Pixi sales were sufficient to cover its marketing bill and return the company to profitability.”

Wolf concludes that “In the mean time, time is running out. Supported by an increasing number of smartphone manufacturers, the Android juggernaut is continuing to gain steam. And the day when Microsoft (N/R) launches Window Phone 7 and rejoins the spending party is drawing closer.”

If it’s true that bad news begets bad news, Palm is in for a very rough time of it in the months ahead. The company has already lost half its market value since the year began. Time for a takeover? Perhaps, though Rubinstein seems intent on staying the course.

“There’s all kinds of speculation out there that we are going to get bought, that we are not going to get bought,” Rubinstein said on the earnings call Thursday. “We’re not going to comment on any of those. Obviously, we are a public company. And if there’s a reasonable proposal, of course the Board has to consider it. But, that being said, our focus since the day I arrived here, and that’s almost three years ago now, is to build a great company with a great mobile platform and great products. And that has been our focus.”

FURTHER READING:

Palm Pileup: Weak Smartphone Sales and a Gruesome Q4 Forecast

John Paczkowski — Thu, 18 Mar 2010 20:22:57 +0000

No surprise, following Palm’s (PALM) dismaying February warning: The earnings news today is grim, though a bit less so than some had feared.

The good news: For its third quarter, Palm reported a net loss of $18.5 million, or 13 cents a share, on revenue of $349.9 million. That’s nicely ahead of its recent guidance of $285 million to $310 million, but obviously well below the $424.7 million analysts had been expecting before the pre-announcement.

The bad news: While Palm shipped 960,000 smartphones during the quarter, the company sold only 408,000 of them. That’s about 30 percent less than it sold last quarter and significantly fewer than the 500,000-600,000 analysts were looking for. Palm has a lot of unsold inventory sitting around.

And then there was this: Looking ahead, the company said it fourth-quarter revenue will be less than $150 million. That’s about half what Wall Street was expecting. Pure ugliness.

“Our recent underperformance has been very disappointing, but the potential for Palm remains strong,” said Jon Rubinstein, Palm chairman and chief executive officer. “The work we’re doing to improve sales is having an impact, we’re making great progress on future products, and we’re looking forward to upcoming launches with new carrier partners. Most importantly, we have built a unique and highly differentiated platform in webOS, which will provide us with a considerable–and growing–advantage as we move forward.”

At $4.94, Palm shares are down more than 12 percent as I write this.

Notes from the earnings call:

There are now over 2,000 apps in the Palm App Catalog.
Handset sales are predominantly webOS.
Rubinstein says Palm has been held back by “execution missteps.”
Rubinstein declined to discuss speculation about a possible acquisition of the company

FURTHER READING:

Could Be Worse, Could Be Raining: Palm’s AT&T Launch Delayed?

John Paczkowski — Wed, 17 Mar 2010 14:39:12 +0000

Palm’s fourth quarter may turn out to be no better than its third–an ugly period marked by a grotesque 30 percent revenue shortfall, poor sales and tepid interest in the company’s new line of smartphones.

In his latest note on the company, Canaccord Adams analyst Peter Misek says Palm’s (PALM) already substantial troubles are mounting. Palm’s latest problem: Delays in the long-rumored launch of its smartphones on AT&T (T). Originally expected this spring, sources now say the debut of new Pixi and Pre models has been pushed back until summer.

“Beyond generally lacklustre handset sales in the current quarter, which are already reflected in our previous estimates, we have recently learned that AT&T has delayed the planned launch of the Pre and Pixi on its network from April to June/July,” Misek writes.

“Moreover, we believe that this is more than just an ordinary delay,” the analyst adds, “as AT&T has cited a long list of technical issues with the Pre and Pixi. Furthermore, the carrier has decreased its initial order size and has decided to sharply reduce its marketing budget for the launch.”

So: A delayed launch on another major carrier, a smaller first order and a soft marketing budget. On top of these issues, Misek cites a mysterious “list of technical issues.” I’m not quite sure what he is hinting at; my sources tell me there are no problems with the devices on AT&T’s network–but perhaps Misek knows something they don’t.

Leaving the mystery list aside, this is bad news all around for Palm, which clearly needs the additional distribution it will get through AT&T sooner rather than later. Misek is slashing his February quarter unit shipment forecast to 670,000 from 720,000 and his 2011 forecast to 3.58 million units from four million.

Honestly, this getting difficult to watch.

Palm is scheduled to report third-quarter earnings after Thursday’s closing bell.

FURTHER READING:

App Watch: Seeing Success on the Palm Pre

Yukari Iwatani Kane — Mon, 15 Mar 2010 15:00:47 +0000

Success stories about iPhone app developers are well documented, but one game maker says it has gotten better results in an unlikely place: Palm’s App Catalog for its Pre and Pixi smartphone devices.

Palm (PALM), which has been trying to turn itself around, created a stir last month when it admitted that its phones weren’t selling as well as it had expected. Palm warned that its revenues for the year would be “well below” forecasts.

But Redwood City, Calif.-based Self Aware Games say they liked Palm’s webOS software enough that they took a chance about a year ago and started developing poker and blackjack games like “Word Ace” and “Card Ace: Blackjack” for Palm devices first, closely followed by versions for the iPhone and Facebook.

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In Mobile Gymnastics, the Motorola Backflip Scores a 6

Katherine Boehret — Tue, 09 Mar 2010 21:47:23 +0000

Touch screens are now prevalent enough on mobile devices that I find myself touching the screens of every new gadget I see. My trusty index finger of a stylus is ready at all times to swipe, pinch, double tap and scroll since these are natural gestures.

[ See post to watch video ]

Yet touch screens have some downsides. Finger gestures leave smudge marks on the glass screens and monopolize screen real estate, making it hard to show the screen to someone while navigating. Also, touch screens often require two hands.

This week, I tested a smart phone with a solution for two of the three touch-screen problems. The Motorola Backflip (http://3.ly/Ku9), which became available March 7, lets people navigate its screen by touching a panel behind it, thus keeping fingers off of the screen. This trackpad-like panel is appropriately named the Backtrack and works like magic: On-screen objects are selected, text scrolls and screens open, but you can’t see the fingers manipulating the screen because they’re hidden behind it.

The Backflip, which runs on AT&T’s (T) 3G network, costs $100 after a $100 mail-in rebate and a two-year agreement. Its name comes from its design: The Backflip’s screen seems to flip backward when the QWERTY keyboard flips down for use. In the device’s “closed” position, the keyboard flips back up and is automatically turned off.

I’ve been using the Motorola Backflip for emailing, Web browsing, social networking, taking photos and making phone calls. While I applaud its creative design and the idea of the Backtrack, I think it sacrifices functionality for form. Take, for example, its QWERTY keyboard, which has a subtly handsome design when the Backflip is closed. But when used for typing, its shallow keys don’t give much tactile feedback and are tough to use. Likewise, the Backtrack is clever, but only works when the phone is the flat, opened position, forcing people to reach around both the keyboard and the screen to use it. I often found myself giving up and just touching the screen directly, which also works.

Other companies’ mobile devices have found ways around actually touching their touch screens, silly as it may sound. Palm’s (PALM) Pre and Pixi models use a gesture area beneath the screen to navigate—with just one hand holding and swiping.

The Backflip in opened position.

I easily set up two email accounts and Twitter and Facebook accounts on my Backflip. There are also shortcuts for setting up accounts for Picasa, Photobucket, Bebo, LastFM and MySpace.

The Motorola Backflip runs Motoblur, the company’s social-network and message-consolidating software, which I found to be an attractive interface with intelligent capabilities. For instance, if it senses you’re checking it a lot, it will update the displayed messages more frequently. Motoblur also uses images from contacts, like their Facebook or Twitter photo, and displays these as small background icons behind Motoblur messages from that person. This is a small detail, but it brings an extra spark of life to everyday messages.

But Motoblur lacks one of the most popular Twitter functions: the ability to re-tweet, or re-message someone else’s tweet (Twitter status). A Motorola (MOT) representative said re-tweet is under evaluation, but won’t disclose details about timing. Motoblur has been available for six months, first seen in the Motorola CLIQ.

Oddly, the Backflip runs the Android 1.5 operating system, not the newest Android 2.1. A Motorola representative said the company plans to update this but wouldn’t say when. It seems strange for a brand-new device not to run the newest operating system.

Phone calls were clear and loud, and photos captured on the five-megapixel, flash, digital zoom camera looked great. I enjoyed using the Backflip’s bright, 3.1-inch screen with 320×480 pixel resolution. Though I wasn’t crazy about typing on its keyboard, I did like the keyboard shortcut keys for the Web browser, home, email and search. With the Backflip in its opened position, I used the Backtrack—the trackpad behind the screen—to skip around from one thing to the next. Double tapping on anything selected it, and I swiped my fingers down on the Backtrack to scroll a long news story on the browser.

The Backflip is designed so that whenever it’s plugged into its wall charger or set at a 90-degree angle, it goes into Tabletop mode, showing a large digital clock with the local weather, date and options for setting an alarm. This mode also offers a button for watching the device’s photos in a slow-panning, Ken Burns-like slideshow, which is useful for sharing with friends.

Monthly AT&T plans that work with the Backflip include a combination of the carrier’s required $30 unlimited data plan and a $40, $60 or $70 voice plan. It comes with a 2-gigabyte memory card, though it will work with one that holds up to 32 gigabytes. Its internal memory is 512 megabytes, and the memory available for apps is 220 megabytes, though certain apps can offload some data they use onto the roomier card.

Motorola deserves credit for trying an innovative design and for offering a unique way of moving fingers off of the touch screen. But the Backflip device seems unfinished because of several features that don’t work as well as they should.

Edited by Walter S. Mossberg

Write to Katherine Boehret at mossbergsolution@wsj.com

Palm Resumed Smartphone Production Last Week

John Paczkowski — Wed, 03 Mar 2010 18:36:09 +0000

With Chinese New Year celebrations finished, Palm’s manufacturing partners in China are once again producing webOS smartphones after a temporary shutdown in observance of the holiday.

Sources close to Palm (PALM) tell me production resumed last week–on Feb. 22 to be exact. Ironically, that was right before the company warned that lousy sales of the Pixi and Pre and their “plus” variations would cause a revenue shortfall in the current quarter and in fiscal 2010.

PREVIOUSLY:

Palm's Salvation? Less Push, More Pull.

John Paczkowski — Tue, 02 Mar 2010 00:09:00 +0000

Palm’s warning last week of a gruesome fiscal third-quarter revenue shortfall confirmed fears that have haunted the company since it first brought its new webOS handsets to market last year: Neither the Pre nor the Pixi is the “hero” device that commands the consumer attention needed to really turn the company’s fortunes around.

Certainly, Palm’s (PALM) carrier partners haven’t viewed it that way. If they had, Palm wouldn’t be sending hundreds of “Brand Ambassadors” out to Verizon stores in the hopes of juicing sales.

According to Palm CEO Jon Rubinstein, that campaign has met with some success. But it has clearly been hard going against heavily promoted Android devices like the Motorola (MOT) Droid. And it’s only going to get more difficult when Google’s (GOOG) Nexus One smartphone goes live on Verizon (VZ) in the next few months.

So what’s Palm to do? Over at Needham & Company, analyst Charlie Wolf suggests the company redouble its efforts to build out the webOS ecosystem.

“The effort to push the Pre in the carrier channel has not worked because of reluctance of carriers to promote the brand against the Android juggernaut,” Wolf writes. “In our view, then, Palm’s only hope is to adopt a pull strategy; that is, to focus on its software developer program to build a library of compelling applications for the WebOS platform.”

As Wolf sees it, “This effort could prove successful because WebOS’s development tools are already familiar to Web developers; and the developer environment itself is arguably superior to that on Android.”

Worth a shot, right? One of Android’s biggest weaknesses right now is a paucity of good apps. Same thing with Research in Motion’s (RIMM) BlackBerry. If Palm were to drum up some serious developer support and differentiate itself on that level, perhaps it might win a bit more of the market’s attention.

With that and a new gotta-have-it “hero” device, the company might gain at least some of the traction it needs to hold its own in a market that’s being hit with a wave of new Android devices and soon, presumably, a new Apple (AAPL) iPhone as well.

Otherwise, Palm may further languish, or worse. Says Wolf: “Unfortunately, if this [pull] strategy does not work, Palm could be assigned to oblivion.”

And if Palm's Project JumpStart Doesn't Work Out, There's Always "Project Defibrillator"

John Paczkowski — Fri, 26 Feb 2010 16:05:23 +0000

Will lousy brand awareness be Palm’s Waterloo? With weaker than expected launches of the Pre and Pixi at new carrier partner Verizon, it’s beginning to look like it.

Certainly, Palm’s leadership appears to believe that insufficient carrier support is largely to blame for its current woes. In an all-hands memo to employees yesterday (full text below), Palm CEO Jon Rubinstein said the company is taking some extraordinary measures to address unexpectedly weak sales for its handset lineup. To drive demand at Verizon and raise its customers’ apparently limited awareness of webOS, Palm (PALM) has initiated Project JumpStart, a sort of product evangelism outreach program.

“To accelerate sales, we initiated Project JumpStart nearly three weeks ago. Since then, nearly two hundred Palm Brand Ambassadors, supplemented by Palm employees from Sunnyvale, have been training Verizon (VZ) sales reps across the U.S. on our products. Early results from the stores have already shown improvement on product knowledge and sales week over week. You may have also seen a growing number of Palm ads on billboards, bus shelters, buses, and subway stations–all getting the word out about Palm.”

A wise move, particularly given reports that Verizon sales reps unfamiliar with Palm’s smartphones often opt to pitch more familiar devices like Motorola’s (MOT) Droid and RIM’s Blackberry to new customers. Additional in-store training should help drive sales volume, assuming Palm’s offerings are compelling and differentiated enough to withstand comparison with rival devices.

The question, of course: Are they? And while initial reviews of the Pre and webOS operating system suggested they were, it’s hard not to look at Palm’s current situation and conclude that they really might not be–particularly with new and impressive Android and Windows Phone 7 devices headed to market and Apple (AAPL) and Research in Motion (RIMM) both presumably working on refreshes of their iconic devices.

“Given the sizable discounts now prevalent on the Pixi, it now suggests that the real problems for the Pixi and the Pre go beyond insufficient carrier support and unfocused TV advertising campaigns,” CL King analyst Lawrence Harris observed in a research note to clients this morning. “Rather, consumers are not finding the Pixi a compelling product in an increasingly competitive smartphone market.”

If that’s truly the case, these Palm Brand Ambassadors the company is sending to Verizon (VZ) have their work cut out for them, at least at the moment. Sources close to Palm tell me the company plans to introduce at least one new smartphone this year. Perhaps that will be the device that drives demand and pushes the company back to profitability.

Team,

This morning we announced preliminary results for our 2010 third quarter. Since the quarter has not yet closed, it is too soon to offer exact numbers, but we stated that we expect to report revenues for Q3 between $300 and $320 million. We also announced that we expect our revenue for this fiscal year to fall below the guidance we gave to Wall Street, which ranged from $1.6 to $1.8 billion. As we mentioned in our press release, our softer than expected performance is due to slower than expected customer adoption of our products, which in turn has prompted our U.S. carrier partners to put additional orders on hold for the time being. On a positive note, we expect to exit the quarter with over $500 million in cash on our balance sheet. We’re scheduled to announce our full financial results in March.

I realize this news is difficult to swallow. We made this announcement today to prevent a surprise for Wall Street when we announce quarterly earnings in March. In the meantime, the entire executive team has been working extremely hard to improve product performance, and have implemented a number of initiatives to increase awareness and drive sales.

Dave Whalen and I just returned from a very successful meeting with Verizon Wireless, where they acknowledged that their execution of our launch was below expectations and recommitted to working with us to improve sales. To accelerate sales, we initiated Project JumpStart nearly three weeks ago. Since then, nearly two hundred Palm Brand Ambassadors, supplemented by Palm employees from Sunnyvale, have been training Verizon sales reps across the U.S. on our products. Early results from the stores have already shown improvement on product knowledge and sales week over week. You may have also seen a growing number of Palm ads on billboards, bus shelters, buses, and subway stations–all getting the word out about Palm.

All of these efforts are examples of how we are working to accelerate adoption and grow distribution of webOS. In the next few weeks, your management will work with you to make sure your priorities are laser-focused, primarily on helping to increase sales, improve product quality and differentiate the Palm product experience.

Our goals are taking longer than expected to achieve, but I am still confident that our talented team has what it takes to get the job done.

We’ll schedule an all-hands meeting after our earnings announcement in March, and I’ll be happy to answer your questions.

Go team!!!

jon

Palm: Sales Well Short of Targets at Verizon, Canaccord Says

Eric Savitz — Thu, 25 Feb 2010 13:00:15 +0000

Sales of Palm (PALM) smart phones at Verizon Wireless (VZ) are coming in well short of targets, according to Canaccord Adams analyst Peter Misek.

Misek told his firm sales force [Wednesday] afternoon–and then told me–that he thinks sales of the Pre Plus and Pixi Plus so far are less than 50 percent of Palm’s target levels. He believes Verizon will have to reassess its approach. Misek notes that there are multiple options: the carrier could ratchet up marketing (likely together with Palm); it could re-train store sales reps to push the phones; it could change its marketing approach; or it could simply throw in the towel and stop selling Palm phones entirely.

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Palm Shorts Celebrating Chinese New Years in Style Thanks to OTR Global Report

John Paczkowski — Thu, 11 Feb 2010 21:45:27 +0000

With a new distribution deal with Verizon (VZ) in hand and another with AT&T (T) in the works, Palm is about the last company you’d expect to shut down production of its entire smartphone lineup. Yet, that’s what it did. As OTR Global reported in a breathless alert this morning (see below), Palm manufacturing partners Foxconn and Compal have temporarily shut down production of the Pre, Pre Plus, Pixi and Pixi Plus.

But not for any worrisome reason, as the OTR note seemed to imply.

No, Palm handset production was shut down in observance of Chinese New Year. And, contrary to OTR, which suggested that production might not resume in March, production will indeed resume by March. In fact, sources close to the company say current plans call for it to resume near the end of this month.

Anyway, here’s Palm’s statement on the matter. Presumably, now that the statement has been issued, Palm (PALM) shares will recover some of the losses they suffered earlier today because of OTR’s note. But Palm shorts, I’m sure, had a field day with this one.

“Palm regularly adjusts its product manufacturing levels to manage inventory,” the company said in a statement sent to Digital Daily. “In anticipation of the Verizon Wireless launch and Chinese New Year, we increased production levels prior to February, and anticipate ramping production back up after the Chinese New Year ends.”

Palm Inc. Alert
Palm Orders Production Halt of Pre and Pre+ in February
February 11, 2010
PALM, S, VZ, 2038 HK, 8078 TT
Sources: 3 sources Taiwan handset component supply chain (all repeats)
Key sources in the Taiwan handset supply chain said Palm Inc. has ordered assembler Foxconn International Holdings Co. Ltd. to suspend production of both the Pre and Pre+ in February. “The decision is very sudden, and Foxconn was told to reduce all February Pre forecast to zero on Wednesday and nobody knows whether shipment will resume in March,” said a key source. The source said the CDMA2000 Pre to Sprint and the CDMA2000 Pre+ to Verizon were affected.
Pixi Production Suspended Too?
One source said Palm also told Compal Communications Inc. to suspend shipment of the Pixi and Pixi+ in February, while another source said that production is still going ahead with the Pixi+ to Verizon, but actual delivery in February will amount to less than 5,000 units.
Reporter: Van Tran
Editor: Hartmut Leuschner

Reminder: Microsoft's WinMo on 18 Percent of U.S. Smartphones

John Paczkowski — Tue, 09 Feb 2010 13:00:33 +0000

Here’s a metric to consider in advance of The Mobile World Congress next week and the likely debut of Microsoft’s Windows Mobile 7 operating system: As widely maligned as it is, Windows Mobile was still running on 18 percent of U.S. smartphones at the end of 2009, according to comScore (SCOR). This despite our continuing fascination with Apple’s (AAPL) iPhone, Palm’s (PALM) Pre and Pixi, and Android phones like Google’s (GOOG) Nexus One and Motorola’s (MOT) Droid.

Windows Mobile has the third largest smartphone market presence in the U.S., after Research in Motion (RIMM), which controls 41.6 percent of the market, and Apple, which controls 25.3 percent. (See table above; click to enlarge.)

Worth remembering because Microsoft’s (MSFT) portion is far larger than Palm’s share, which fell to 6.1 percent in the December quarter, and Google’s share, which though doubled over the year prior, was still just 5.2 percent.