There is something that draws you in when you are driving down the road and see a sign that says, “Palm Reading.” You’d really like to have someone be able to lay out your future, especially all the good things that are likely to happen in your life. You know it’s a little bit of a farce (no one really knows what’s going to happen), but it is fun to let some purported futurist give it a try. This is exactly the situation I feel I’m in when trying to read the future of Palm, Inc. Everyone wants me to let them know what’s going to happen with this company. Here’s my view on what I think is going to take place. Remember, the value of this “Palm reading” is worth exactly what you’re paying for it.
Palm is in a bit of a rut. Being a public company, they just reported earnings. The report is that, while unit sales and revenue are up, both were lower than expected. Unit sales have increased thanks to some serious promotions being implemented by Verizon Wireless. However, the carrier’s current promotion offers two Palm Pre’s for $149 or two Palm Pixi’s for $79. It’s right on the edge of being a fire sale. Is bankruptcy next?
Palm CEO Jon Rubenstein, Palm’s board of directors and the hardworking Palm team need to do something different. I can see a bright, rosy future for Palm but it’s not from continuing what they are doing now. In Obama-esque style, they need to embrace change as a core value. Here are five things that I believe they should do:
1. Improve Palm products
The Palm Pre and Palm Pixi are nice products. But that’s the problem: they are nice but not great. For convenience, they integrated an older Centro-like keyboard into the Palm Pre and Palm Pixi that is not easy to use. What they should do is build a product that incorporates a larger screen, perhaps just a tad larger than the iPhone. They should integrate a landscape, flip-out keyboard that is wide enough to make it easy to thumb type.
They need to integrate a camera with a major brand such as Canon, with 3x or 4x optical zoom, flash, film speed adjustment and ability to create high-definition movies. There is still a wide-open field out there to build better smartphones. Palm could lead the charge by creating the next generation of smartphone.
2. Improve Palm’s branding
Drop the Palm Pre. Bring back the Palm Treo. It’s a known brand. It represents everything good that Palm did for years to lead the smartphone market. With this branding, we could all then say that the Palm Pre was the “Precursor” to the return of the Palm Treo. Plus, there’s a new definition for the three key service elements in the Palm Treo: 1) phone, 2) applications and 3) services such as social networking.
Merge Palms webOS with Intel and Nokias MeeGo
3. Merge Palm’s webOS with Intel and Nokia’s MeeGo
Intel and Nokia announced a merger of their Linux-based smartphone operating systems at the recent GSMA Mobile World Congress. Thus, Intel’s Moblin and Nokia’s Maemo are merging into one offering called MeeGo. Palm has some great features in the Palm webOS (for example, Synergy, Web standards for development, and integrated social networking). It’s based on Linux. It would take some effort but the resulting effort where Intel, Nokia and Palm all work on a common open-source, Linux-based operating system would stand up well against Google Android and Apple iPhone. With such a strong effort, perhaps they could get RIM to join the coalition as well so they could use a really solid mobile Linux platform for the next-generation BlackBerry devices.
4. Find Palm a strong partner
Palm needs to find a good partner-not just one such as Foxconn (Hon Hai) that can produce volume products. Rather, they should link up with someone such as LG, Lenovo, Motorola, Nokia or Samsung. Most likely, this would result in an acquisition where Palm would become the owner’s new smartphone unit. Thus, a larger, global company such as Lenovo (who makes ThinkPad notebook computers for the United States market and phones for the China market) could utilize the Palm brand as its own smartphone division.
Nokia could do the same thing. After all, Nokia is primarily focused on lower-end phones and sells over a million a day. They could set up Palm as their smartphone division, utilizing MeeGo to build insanely great, higher-end smartphone products that would be sold worldwide. They could integrate all the great features of webOS into MeeGo. If they did this, Nokia would see their United States market share skyrocket. The company has just hired Goldman Sachs and Qatalyst Partners to assist them in finding just such a partner.
5. Build the successor to application stores
Application stores are certainly a rage led by Apple, but every major handheld platform (iPhone, BlackBerry, Windows Phone, MeeGo and Android) now has an application storefront. The next generation of smartphone development is going to be around services. Information of the Web will be integrated and made available via services delivered wirelessly to the user’s smartphone. Palm Synergy is a perfect tool for building the next-generation wireless services.
I hope my Palm reading turns out to be close to the way Palm’s future plays out. Users will certainly benefit. I, for one, will be rooting for them.
J. Gerry Purdy, Ph.D. is Principal Analyst of Mobile & Wireless at MobileTrax LLC. As a nationally recognized industry authority, Dr. Purdy focuses on monitoring and analyzing emerging trends, technologies and market behavior in the mobile computing and wireless data communications industry in North America. Dr. Purdy is an “edge of network” analyst looking at devices, applications and services, as well as wireless connectivity to those devices. Dr. Purdy provides critical insights regarding mobile and wireless devices, wireless data communications and connection to the infrastructure that powers the data in the wireless handheld. He is author of the column Inside Mobile & Wireless that provides industry insights and is read by over 100,000 people a month.
Dr. Purdy continues to be affiliated with the venture capital industry as well. He currently is Managing Director at Yosemite Ventures. And he spent five years as a Venture Advisor for Diamondhead Ventures in Menlo Park where he identified, attracted and recommended investments in emerging companies in mobile and wireless. He has had a prior affiliation with East Peak Advisors and, subsequently, following their acquisition, with FBR Capital Markets. For more than 16 years, Dr. Purdy has been consulting, speaking, researching, networking, writing and developing state-of-the-art concepts that challenge people’s mind-sets, as well as developing new ways of thinking and forecasting in the mobile computing and wireless data arenas. Often quoted, Dr. Purdy’s ideas and opinions are followed closely by thought leaders in the mobile and wireless industry. He is author of three books as well.
Dr. Purdy currently is a member of the Program Advisory Board of the Consumer Electronics Association (CEA) which produces CES, one of the largest trade shows in the world. He is a frequent moderator at CTIA conferences and GSM Mobile World Congress. He also is a member of the Board of the Atlanta Wireless Technology Forum. Dr. Purdy has a B.S. degree in Engineering Physics from University of Tennessee, a M.S. degree in Computer Science from UCLA, and a Ph.D. in Computer Science and Exercise Physiology from Stanford University. He can be reached at [email protected].
: From time to time, I may have a direct or indirect equity position in a company that is mentioned in this column. If that situation happens, then I’ll disclose it at that time.