10 Reasons Why Palm Pre May Become the Smartphone Flop of 2009

A report has surfaced claiming Verizon Wireless won't be bringing the Palm Pre to store shelves. The device was originally expected to be offered to Verizon Wireless customers later this year or in early 2010. For a while, the possibility of the Pre coming to carriers other than Sprint seemed quite likely. Palm's CEO said its phone would be offered on multiple carriers. Even Verizon Wireless CEO Lowell McAdam said users should expect to see the device on his network. It seemed like a done deal.

But Verizon Wireless, according to the report, is having some second thoughts. And the chances of it bringing the Pre to its network are growing slimmer by the day.

I find this quite alarming for Palm. If the company can't revive the Pre on Verizon Wireless' network, it's debatable just how long the device will be able to keep it afloat in the mobile phone space. At this point, it's entirely possible that the Pre will become this year's smartphone flop.

Here's why:

1. Ubiquity is everything

Say what you will about the iPhone and its exclusivity contract with AT&T, but it's the only device on the market that can pull it off with that kind of success. The Palm Pre doesn't have the curb appeal that the iPhone does. It also doesn't attract customers the way Apple's product does. It needs to be on as many carriers as possible if it is to be a success. Without Verizon Wireless' help, there's not much more Palm can do to turn things around.

2. Where are the apps?

When we consider the fact that the Palm Pre has just a few dozen applications available to users and there's no guarantee right now that that will change drastically in the short term, the Pre isn't as appealing to users as competing smartphones. Palm's main competitors all have more apps than the Pre. Apple's App Store has over 75,000 applications. Google's Android Market has over 8,000 applications. Research In Motion's BlackBerry App World has over 2,000 applications. There is no comparison.

3. The network

Although there are some folks who love Sprint, the majority of U.S.-based users are on AT&T and Verizon Wireless networks. Those companies have many more millions of subscribers and easily dwarf Sprint's subscriber base. It's an issue for Palm. The company is starting out with fewer potential customers. And with a phone that doesn't captivate audiences the way the iPhone does, it only spells trouble for the Pre.

4. Sales, please?

According to the aforementioned report, Palm has yet to sell 1 million Pre units. That, according to the publication, was one of the main reasons why Verizon Wireless had second thoughts about bringing the device to its stores. Consider the fact that Apple and RIM sell 1 million phones without batting an eye and I think it tells us everything we need to know about the Pre's position in the marketplace.

5. It's lost in the shuffle

When discussions about smartphones arise, inevitably the discourse moves to the iPhone and the BlackBerry. Again, all the other devices on the market simply don't have the curb appeal that those products do. Realizing that, the Palm Pre is lost amid the hundreds of cell phones currently on the market. It can't be distinguished.

Next: Pricing the Pre Out of the Market >>