Here’s a fun hypothetical for your Sunday. Let’s say you’re Palm, and you’ve poured untold sums of money and time into developing the Pre; the early response has been positive. But when you launch the phone, hopefully still sometime before July, it completely and utterly bombs. For whatever reason—people unwilling to give up the iPhone, people unwilling to switch to Sprint—it just doesn’t do the numbers you expected it to, or needed it to. Then what do you do?
But let’s step back for a minute: is there any evidence to suggest that the Pre won’t do well? Hard to say. During CES in January, anyone even tangentially interested in gadgets and technology seemed to be mightily impressed. Dumb Peter Ha even went on G4 to say, yeah, the Palm Pre looks pretty darn good; Peter is a Charles Montgomery Burnsian cynic, it must be said. Developers seem to like its operating system, webOS. (It has a physical keyboard!) But let’s temper the enthusiasm.
First, and let’s make no mistake about this, Palm really needs the Pre to be a hit, with a Gartner analyst calling it a “bet-the-company product.” If it tanks—again, there’s no reason to assume it will tank—then Palm is in a bad way. The company just posted its seventh consecutive quarterly loss (to the tune of $94.7 million); revenue is down nearly $100 million from the previous quarter ($77.5 million vs. $171 million last quarter). Palm could use a hit right about now.
And then there’s Sprint, which has exclusive rights to the Pre through the end of the year. Sprint doesn’t have the best reputation of the big cellphone carriers here in the U.S., nor does it have a surplus of subscribers. It needs to convince people to switch from AT&T, Verzion and T-Mobile in order for the Pre to be a success. (Say what you will about Verizon’s lackluster phone selection, but I’ll be damned if you can find a better-sounding cellphone call in the northeast than with Verizon. Dream combo: the Pre on Verizon!) So we’re dealing with two wobbly companies that need each other to exceed expectations.
In the words of a famous radio host, good luck, bro.
And, for the record, lest someone accuse me of being a biased jerk, I want to see the Palm Pre succeed. My concern here is Sprint. I haven’t used a Sprint phone in ages, and I’m one of those weird people who still like their phones to make reasonably clear phone calls. If the Pre is good but Sprint stinks (which is my opinion of the iPhone/AT&T setup), then I may hold off. We’ll see.
if it’s a sprint issue you quickly release a new phone with different form factor, like a horizontal slider or all touch screen with the same os on other carriers.
if’ it’s an os problem you put 100% of effort into fixing it ASAP. the windows short. Like a week or two before bad buzz ruins it. Android had tons of buzz but mainstream reviews were no where near what the tech nerds thought of it and mainstream people said i’ll wait till it’s not like a beta.
additionally you drop the price if needed.
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Fuck off Garbowicz
Can’t say I disagree, talk about a completely off-topic hijack. Do you really think methods like that will get you somewhere, LOL!
Garbageowicz … Keep sh!t like that going and you will turn the blog crowd against you… the crowd you WILL need…
Check out the Floria BBB. This company is under investigation.
liar. there is no report on this company at the florida BBB.
Is it also a dessert topping?
This is what I said yesterday:
If the Pre is not a blockbuster success, there goes Palm. Personally I think Palm stands a great chance to fail. First, they are putting a lot of weight behind a standard platform for third party developers. Except for the iPhone, no one is seeing exceptional interest from mobile developers wanting to take time to develop applications for their product. This may have been something to get excited about 6 months ago when the Pre was announced, but not now. Second, for the Pre to be a big success, it’s crucial that it has a blockbuster launch. By only having Sprint/Nextel exclusively sell the phone, they are limiting themselves 90%, not to mention, the majority of mobile users (18-30), who are prime targets to buy this phone, don’t use Sprint/Nextel. Third reason, Android. So long to the closed, one-off platform that is unique to each of the manufacturers (except Apple, but this goes for the standard computing game as well). Android will spread like a virus to almost 100 devices by 2010. Because it is open-source, we are already seeing companies tweaking it to have the same possibilities of the iPhone, like The Magic. Not to mention, if you are a developer, creating an app once, you will get your app noticed by 100x more devices than just programming for the Pre. Even Apple is worried about Android (the Pre to Apple is like Cal State Northridge popping off to UNC that they are going to knock them out March Madness, it’s just noise). Lastly, let’s not forget where Palm came from. Before the Pre announcements, Palm bounced back from near the point of no return. Remember when not too long ago, their stock price was hovering around $1.00? They have had no positive fiscal news since, so if the Pre is a flop, what’s stopping it from diving below that price? Nothing. See ya Palm.
http://tinycomb.com/2009/03/22/if-the-pre-flops-palm-goes-down-with-it/
If Palm tanks, Microsoft might buy it. Windows mobile is a serious POS.
I don’t think the pre will bomb, but to become a big success at this point all depends on their advertising. If they can hype the phone well enough it will help both companies. Yellow swirls around the phone wont cut it.
I think that locking the Pre in with Sprint for all of 2009 was Palm’s biggest mistake. Sprint is losing customers faster that a bleeding hemophiliac and just doesn’t have the same level of call quality or service reception that your Verizon or AT&T do… maybe in large metropolitan areas, but not anywhere outside of them.
I, too, want Palm to succeed here – I really do. The Pre is the first really solid phone that I’ve gotten genuinely excited for. Sprint is the real x-factor for me here… I’d switch to AT&T before I switched to Sprint, and either one of those situations is still unlikely. I’ll probably just stick it out with my first generation LG En-V until Palm let Verizon have the Pre.
you have to remember that Palm got something in exchange for that exclusivity – probably something that Palm needed pretty badly, like marketing money, cash upfront, guaranteed sales, big subsidies for consumers etc. Palm wasn’t exactly in a position to bargain that hard because they are in a desperate situation.
But you’re right, it was a move that puts them in a precarious position. This is a hail-mary for both companies, and I’m putting the odds of success at less than 50/50.
The Pre will not bomb but will not be a blockbuster. It will be sold but returned once its limitations are fully realized by users (like the Storm) — multitasking will slow the operations and drain the battery fast.
The Pre is admittedly not aimed to compete with RIM or Apple directly (the BlackBerry is for business, the iPhone is for entertainment–according to Palm) but as an entry level smartphone “for the rest of us.”
Palm will fade into irrelevance in a year– or bought out by one of the fellow struggling “handset makers.” Cell-phones and cell-phone makers are doomed…
Are you crazy? “multitasking will slow the operations and drain the battery fast”. Where do you get that idea? That’s true on a few phones, but not the majority of them. Case in point: Blackberries multi-task very well. Most Windows Mobile ones do to (my favorite OS). The ones that don’t are because the manufacturers put too little RAM in in. My iPhone 3G, for example, only has about 40mb of FREE RAM upon startup. my Moto Q9h on the other hand has well over 100mb. it handles email, music, and nav all at the same time with NO PROBLEMS. SO, as long as the Pre has decent RAM, and we know it has the best processor on the market, then it should multi-task well.
What does RAM have to do with battery life? Running apps in the background on a mobile has always been a drain.
I’ve reluctantly stuck with Sprint hoping that they improve and get their act together. The only reason I have not bailed is because I have an intense dislike for ATT. In reality, I have almost bailed on Spring several times. The first time was when they wouldn’t listen to reason and grab the iPhone when they had the opportunity. The rest have had to crappy service which has improved a spot or two.
I’d say they’re pretty doomed if it’s not a smashing success.
The question is, how innovative is this device. The market has so many new cool devices, that you need some differentiators to compete.
You mean like the WebOS?? duh… Also, they have very well working multi-touch on a capacitive screen, almost identical to the iPhone. Plus a full keyboard, and all the missing features of the iPhone, like full bluetooth, multi-tasking, and MMS, I believe.
great comment timmy, i agree completely
LOL!! LOL!!!
I don’t know about other people but I myself would love to switch from AT&T (They bound me into a two year contract so I can’t do it right now) but I have a fear that what if Sprint or whatever other are just the same. It’s the same thing that a lot of people have in mind and they don’t switch due to the same reason that what if other is not good enough.
Mohammad Afaq
Free Website Traffic
The only thing keeping me from getting one is Sprint. Blehh… just thinking of them leaves a bad taste in my mouth. There’s a reason why they’re hemorrhaging customers, you know…
Will wait for a GSM version to hit and buy it unlocked if need be. Cannot wait to get rid of my iPhone.
Boardroom Jimmy is bullish on the Pre and expects it to do well, but nearly as well as whale blubber. Frrrrunkis!!
The Pre looks pretty awesome… they’ve got an uphill battle though. They’re going to need to overcome the cell carrier challenges as you listed, and they need to have an amazing phone all around to allow it to even do “okay” from a business perspective.
It’s going to need a very slick, fast, and easy to use OS to make it attractive, and have good battery life. If it has all of those things, they’ll have the potential to compete with the iPhone. They’re going to have to be able to convince people to switch over to it, and pay for data to use it. The Sprint situation is a lame one in my opinion, Sprint + Verizon working together on it would be a lot better of a situation. VZ should actually just acquire S and work to compete with AT&T.
The iPhone really opened up people’s thoughts to such an amazing device, but they still have a lot of work to do on it. I see this as being similar to Ford’s Model T, people had horses before, and now they see things can be done in a different way. Ford has an amazing history, but they still didn’t dominate the auto industry, and so in the long run, I’d say Palm definitely has a chance.
I agree with your comments and just wanted to add the need for a development community. If they have a nice development platform, it will create lots of buzz around the device. It is still going to be hard to compete right now with all the cool devices out there.
Pretty good response.
Yes….a failure means the end for Palm.
Palm has been coasting for quite a while on nothing but the “anything but Microsoft” attitude of its die-hard base, who have spent years avoiding Windows Mobile. Now with the iPhone, Android, and even BlackBerry starting to get some third party support, Palm doesn’t really have a customer base anymore.
As such, I think they are really reentering the market almost as a startup again. I won’t say that the Palm name is actually a determent to buyers, but I don’t think it really buys them any good will with customers either. I think this phone is going to have to work really hard to be a big hit. If I had to guess, I would say that it is going to HAVE to do email better than a BlackBerry, media better than an iPhone, and be more open than Android to even have a chance. That is a pretty tall order for a company that hasn’t really done much in 5 years.
Honestly, I would like to think they are not dumb enough to bet the whole company on a Sprint-only launch. However, if they don’t start seeing serious numbers once they have an unlocked 3G version of the device out, then I think that is pretty much the end for the company.
Man oh man that phone looks cool!
Early adopters will buy enough to keep Palm’s head above water – it’ll be the follow-on buyers who make the live-or-die-Palm decisions. If Palm charges too much for their web-based services (new product according to them) that go hand-in-hand with WebOS (and may be behind some of the functionality we saw with the Pre demos) then the general public won’t buy.
what can i say but…’epic fail’
Here’s the question though – if the Pre is a success, will Palm actually sustain that success? I mean, remember, it’s not like Palm is some upstart that hasn’t been around before. They were the dominate PDA company for years, and when they bought Handspring, they also were pretty dominant in smartphones. Even on the Windows Mobile front they were leaders for a while, especially thanks to some of their improvements over the core WinMo OS.
My concern with Palm is, what about their track record says they will sustain their success this time around? This is the company that let the original Palm OS stagnate and took years and years trying to improve it or come up with a new OS until they finally came out with webOS instead.
Palm needs to not only demonstrate that they can release a nice device with a great OS again, but that they can actually sustain that success and not rest so horribly on their laurels and success this time around.
I am am a Sprint customer. Have been for over 10 years. I know customer service sucked for quite a while, but, has improved the past year. There phone and data service has been quite good and I travel coast to coast often. I have no complaints about calls and data service.
I for one will get a Palm Pre (if cost is reasonable). Giving up my Blackberry will be easy.
It seems most of the negative talk about Sprint comes from non Sprint users that just read news and posts from other non Sprint users. I have experienced ATT and Verizon and will tell you I am happy with Sprint.
I second that statement, and very firmly.
ATT 3G coverage is crap (yes I have used it) and it was only in the last 18 months that Verizon 3G has caught up with (and passed) Sprint due to tower upgrades. But for me Sprint still has the best combination of network, features, and price, and the Pre will be enough to lock me in another 2 years.
As a customer for the last 7+ years, I fail to understand why folks continue to bag on Sprint:
1) Nearly all the carriers have reciprocative agreements regarding use of cell towers, therefore, any perceived network issue a non-starter. I carry a Verizon Blackberry and a personal Sprint phone and can testify that reception/call quality on both carriers is identical, regardless of location.
2) Sprint customer service has greatly improved in past couple of years. A CSR is quick to take my call, friendly and helpful, and always ask if they resolved ALL my issues before ending the session.
3) Sprint has the least expensive voice/data plans of any major carrier. Period. Also, I’m willing to wager that the 3G service on the Pre will be vastly superior to what customers currently experience with the 2nd-Gen iPhone.
4) Right now, Sprint’s Retention Department has been authorized to make substantial concessions to existing cutomers. if you have a Sprint account, escalate your trouble call and you can negotiate some “sweetheart deals.”
Thank you for a good post/read. I agree with you 110%.
ATT service over Sprint in the North East … you couldnt pay me enough, i would be a millionare if i had a penny for each time a friend of mines iPhone dropped a call (especially in Jersey City, Hoboken, Manhatten). Funny how iPhone users use wifi over their “far supperior” 3g network to boot.
Fanboys/Trolls have to put down a carrier to make them feel good about spending hundreds of extra dollars just to have a “me too” phone.
I’m not sure if Pre will be a home run but I completely agree about Sprint. I have had Sprint for more than 4 years and I’ve not had a single dropped call ever, and the coverage is great. I have the best plan that no carrier can match and the customer service is very good. I’m not sure why Sprint gets so much bad press when their service is quite good, they need to work on branding I guess. I used to have AT&T and as Erik said, I won’t switch to them even if you pay me. Iphone is nice but if you can’t make a call when you have to, what’s the point? About the Pre, I was really impressed and I will be the first in line to buy it when it is released.
Same thing here –
Sprint customer service and call quality – A++
Sprint marketing kool aid – D- to F.
People drink the Apple kool aid and saddle themselves to ATT in a heartbeat. Consumers are just flat out stupid.
I also want to see the Palm Pre succeed too.^^
I believe the “Pre” will have a missed opportunity.
I’m not in love with VZ but I’m not ready to move away from them. Why should I move from a first tier carrier to a second tier carrier for a phone that might not live up to its expectations.
If VZ was offering it, it would do extremely well just because of the numbers of potential customers that might be rolling over their plans or who are willing to extend their present plan.
The mistake VZ is making – they are abusing their present customers by not offering the newest, most innovative phones.
For consumers, it would not good if Sprint was bought by one the competitors.
If the “Pre” does not drastically increase the customer base, I’m sure Sprint will be bought by someone.
It’s going to bomb because:
1) high expectations
2) Sprint-only
3) it takes more than just a fancy device at this point (platform, app store, corporate integration, facebook, etc).
It actually might be a good thing for Sprint. This could be a device that puts Sprint is a good place. Will be interesting to watch…
Can it not be a hit overseas to bring in the numbers.
I will buy a Pre (for sure) but I will not go to Sprint!!
Unlocked GSM please.
Besides the Storm, does Verizon have anything coming that will prevent VZ users from leaving for the Pre or iPhone?
You move quickly to release it on all major carriers. And I mean FAST
After having switched from Sprint to AT&T to get the iPhone, and having used both carriers while traveling quite a bit, I can definitely say Sprint has better voice calls and faster data speeds. I used to think Sprint was bad till I tried to use AT&T regularly
But I think the carriers play a far smaller part in my decision making then in the past. Decision around coverage, price plan, customer support, friends in network has become a decision now around what is the best device. And no one could compete with the iPhone. Now I see it as a two horse race finally (Sorry Android, you aren’t there yet)
I would assume there’s a certain level of sales Sprint would have to meet for the phone to Pre to stay exclusive to them through the end of the year right? This was the arrangement with the Storm & Verizon.
Get the Pre right and down the line suck some peripheral services in to the mix (app stores, developer network, etc) and it could be a great and hugely lucrative platform to build a solid mobile ecosystem on.
From what I’ve seen they are doing everything right *technically*. They have perhaps the most technically brilliant device on their hands. I’m not sure about the (lack of) developer/consumer ecosystem around it just yet but let’s hope it’s in the works and it’s super awesome.
Their focus on doing one device and doing it well is allowing them to focus. Going back to basics, building from the ground up is an excellent strategy and we’ll see how it plays out in S2.
I might even buy one.
This is an endless problem with Verizon. I have been lusting after the Pre but will NOT be switching to Sprint to get it. I feel the same about the iPhone, I’m not that interested in AT&T. Part of this is that I’m getting a 22% corporate discount on my Verizon bill. Why Verizon hasn’t stepped it up with new phones is beyond me.
Are we talking about the same Palm who trotted the Foleo out in a major media event and then subsequently ran with their tail between their legs canceling the device because they were the only one who could (finally) see the Foleo was 10 years too late.
That Palm?
Stick a fork in them….
Dell or Microsoft will pick over the carcass.
yes
Here’s what going to happen in 5 to 10 years. Phones will run whatever mobile OS a person wants to. All phones will run only 3G and greater services. Voip applications will replace cell phone calls. Traditional cellphone service will finally go away!
> Phones will run whatever mobile OS a person wants to.
Spoken like a true geek.
Normal Humans, on the other hand, generally want even a smart phone to be an appliance.
Do you really want your subscribers to have to worry about what the Load Average is on their *phone*?
I believe it would be too bold (no punn intended) to project more than 3 to 5 yrs.
Too many variables.
Here are just a few things that could effect the cellphone industry.
1. frequencies the gov’t will auction off later this year.
2. economic impact on the consumer over the next 12 months.
3. corporate funding/investment and financing.
4. lack of or unknown leapfrog innovations on the horizon.
5. market saturation.
I would love to buy the “Pre” if it was with V. But, I’m not moving to S.
My V. contract expires this month but I’m going to ride with month to month til I see a better deal out there.
Sorry “Pre”. I don’t think we are going to hook-up.
Didn’t they say this about Apple, if the iPhone failed?
The difference here is that Apple had its Mac and iPod divisions to fall back on, even if the iPhone failed. It would have been a major loss, but still just one facet of its business.
Palm is only handhelds. That’s all it’s ever really been. They’re betting the farm on the Pre because they have no business elsewhere. They’re either going to succeed incredibly, or fail spectacularly.
Since my last experience with Palm (Treo 500), I would say they are doomed.
Switched to Sprint several years ago, since I was doing some work for them and wanted to avoid the embarrassment of hauling out a competitors phone in the middle of a meeting. I’d been a long time Northeast Verizon user.
Sprint’s data network is superior to the VZW network. The voice network is slightly worse. Slightly. And one tends to roam on VZW towers in Sprint-light areas.
Sprint’s prices are lower — a lot lower if you do some Internet research.
Customer service is improving — it used to be hellish. Now I find it on par with VZW.
Voice, data, value and service are superior in my experience to AT&T — I have not used T-Mobile, but the reason for that is that their coverage is a joke.
In my mind, AT&T means iPhone — other than that, I keep a cheap unlocked phone around for GSM destinations, and get great data service from Sprint. Compared to VZW, I halved my bill, get great data, and personally have never had a voice issue of any importance.
Palm best be workin on a GSM version for overseas that can be quickly pushed to US carriers 1Q ‘10 at the latest.
The only difference between the iPhone on ATT and Pre on Sprint is the Apple mystique. Palm has to execute extremely well, but I don’t think Pre’s success is as dependent on Sprint as people seem to think.
As far as Palm goes, I think it was on death-watch (at least for me personally) a long time ago. I feel like it’s already living on borrowed time. Pre could be a modest success here in the US and slightly more so overseas (has anyone heard any buzz overseas on this? Is it even for sure they will be releasing it in Europe?) and I think it would save Palm.
yes, they will be releasing it here in europe “before summer”.
http://www.precentral.net/movistar-offer-palm-pre-spain-and-latin-america
So in the big picture sprint isn’t a major factor. if the pre bombs in the states thanks to sprint, it can still be a major succes in the rest of the world.
palm put a lot of R&D in the pre, so they will sell the pre in as much countries as they can.
I’ve been with sprint since 2000 and never had a problem with service or dropped calls. Currently I have the Treo 755P and I’m looking forward to upgrading to the PRE.
Unless Palm gets either the WebOS onto some other GSM handsets, or they get the actual Pre onto some other carriers, then yes, Palm is gonna be toast.
They cannot expect to be a major player with their only modern piece of software (since that is obviously what the important thing is here) exclusively on Sprint.
I’ll say this much, so far Palm’s PR group is acting very much like Apple. Suddenly, they’re not talking to anyone about anything. It’s a bad sign.
Interesting that the writer indicates he hasn’t used a Sprint phone in ages, yet somehow he’s an authority on the quality of their service?
Anyway, interesting predictions going on. I like the thought that in general we root for the underdogs.
Sprint is indeed awful.
i switched from verizon to get a palm centro on sprint–and it works fine. a lot of it depends on where you are. here in albuquerque, sprint service, even EVDO, works pretty well.
also, the switch to selling pre as a verizon product once the contract runs out will be easy because after all, they are both the surviving CDMA networks. so the Pre won’t require a new radio to be picked up by Verizon.
I’ll go for a Pre when my contract runs out.
It’s beyond me why everyone is thinking that Sprint is going to kill this. I have had Verizon for 5 years, but their customer service has only gone down hill since they started the “we are the best in the industry” campaign. This, combined with “we are the most expensive in the industry” reality, doesn’t give me many reasons to stay. The internet has a bad habit of perpetuating these myths with very few first hand experiences.
Sprint has the same 30 days guarantee that all providers have, which is more than enough time for you to thoroughly use the phone and determine if it is up to your standards.
What the iPhone really had was all the die hard apple fans that went out and got the iPhone regardless of its carrier. Palm lacks this.
As a mobile developer, what’s the draw? Not an audience. Not a working app distribution channel. Zip. Nada. Just a pretty looking device at a distance with no real look under the hood.
It’s a total X factor at this point, other than the little bit that’s been allowed out.
Partnering with Sprint exclusively is a huge net minus; just look at the rate of subscription losses, anecdotal customer service kudos expressed here to the contrary.
Not sure how much of my own money I’d invest in Pre development, shy of a company coming right out and plunking down some cash in front of me to do something for the phone.
Don’t see it happening.
I find it interesting — not to say amusing — that all the people who dis sprint in this thread just throw away one-liners, with no substantiation.
And all the people who say “No, not so much; Sprint’s pretty decent these days” all provide lots of reasons why they think that.
Did’ja notice that?
Wonder what that means?
I’ve been a Sextel subscriber since 1999, and yes, their customer support used to suck, and yes, lately, it’s *quite* a bit better — they all speak Native English, they answer the phone immediately, the Blackberry reps *know* their handsets; I mean intimately, I have a hard time knowing more than the rep, and that pretty much shocks me; and indeed, they make sure they’ve fixed everything before they let you go.
Now, they screwed up on the 8350i, putting Nextel data instead of EVDO on it, bu in fairness to them, when that phone was being locked, Sprint was probably going to spin Nextel back off; there was no sane way they *could* put the fast data on it.
Doesn’t mean I’ll buy it — I fully expect Qchat to magically appear on the Pre, shortly after launch if not before, and then I’ll be doubly happy.
Did Bono get his money back yet? Weird match for an investment – U2 and Palm.
Palm’s biggest problem is that they’ve completely abandoned their core business, the PDA. There’s a big market for people want a PDA that doesn’t come with a $60/month bill. Yet Palm has discontinued the Z22 (I don’t think there’s an equivalent on the market at all right now), and they haven’t updated the E2 or the TX in years now. Of course, separating Palm OS and Palm hardware into two different companies was a strategic SNAFU that didn’t help anything…
Palm was doomed before Pre ever saw the light of day. All the Pre is doing is delaying the final nail in the coffin.
Hmmm, i hate hearing all the Sprint hate. I’ve been with Sprint/Nextel for over 4 years and have not had any major complaints. Stop the dumb hate. A good phone from ATT, Sprint, or Verizon is a no brainer. The service provider won’t make your life hell so much as to make you shun the phone, that is unless you’re one of those elitists.
I just noticed another thread on techcrunch that probably is putting the nail in the coffin before the Pre is born.
“The iPhone now accounts for 50 percent of mobile Web traffic from smartphones in the U.S.”
Once, people start using something and are satisfied, they are not going to be too quick to jump ship since they presently have a contract and an investment in the the present phone.
This Pre thread is starting to talk me into moving from V. for the iPhone.
It chokes me to say that.