Oh dear – it’s on now.

Either Palm’s making a stand — or they’ve stepped in it big time.

When your smartphone drops from $299 ($199 with contract) to $79 over a summer, you have to wonder what’s going on. Two rumors are circulating this AM, one that Palm is laying off folks, perhaps in the Windows Mobile team.

UPDATE from Palm: “We are not laying people off. As we continue our transformation we are better aligning our staff with our business objectives.”

The estimated sales for the Pre topped out at 375,000 somewhere in the 810,000 range (Palm reports it sold 810K units last quarter and states at least half of those where Pres) at the end of August and they went from $299 ($199 with contract) to about $79 in about eleven weeks. While this might be normal for a feature phone – the subsidy kicks in once they’re sure that the early adopters who simply must have the LG Chocolate have had their fix – this isn’t good for a smartphone that was supposed to be the lead invasion force for a new WebOS smartphone renaissance.

UPDATED with word from Palm.

This is going to end well, and no one will be upset about this. Also, everything I said in that last sentence is probably wrong.

When Debian developer Joey Hess started tinkering with webOS, he noticed that it was sending something to Palm once a day. Surely, Palm wasn’t sending anything too potentially incriminating without making it blatantly obvious to the user, right? Wrong.

Didja hear that RadioShack is rebranding? The hoopla will of course include some sales to drive traffic. Apparently the Pre will be part of this upcoming sale and will be only $150 for new customers. Nice.

Palm has hired the smallest SVP in the world, Jeff Zwerner, to be in charge of its branding initiatives. As Brand Design SVP, Zwerner will use

[...] his significant expertise in strategic brand design and management to Palm’s global advertising, marketing communications, PR, events and web design.

If you weren’t one of the lucky ones that happened to snag a Palm Pre for $99 at Best Buy the other weekend thanks to a pricing snafu, LetsTalk.com has a deal for you. The website has managed to drop the price of the Palm Pre down to only $99 through a combination of instant and mail-in rebates.

There is probably a good chance that if you wanted the Palm Pre, you already snagged it at a Sprint store or Best Buy. Amazon now has the smartphone in case though.

And yet another game of cat and mouse begins.

Over the past 24 hours, Apple has released updates for both iTunes and the iPhone beta SDK. While both are seemingly minor on the feature front, each packs a bit of disappointment for those who had been using loopholes to their advantage.

If you find yourself wishing your Palm Pre had a tad more battery life, Seidio is now selling an extended life battery for $45. It’s the same size as the regular battery pack so it doesn’t require a special back cover for you to use it.

Now that everyone has had their say about the Palm Pre, I thought it wise to say a few words about the oft labeled “iPhone killer” that Sprint and Palm hope will bring each back from the edge of the dreaded deadpool. It seems as though every touch-screen device to launch since the first generation iPhone has faced an uphill battle and the Pre is no different. It’s unpolished, sure, but Palm’s webOS has managed to slip in right behind Apple’s iPhone OS, which is something the other smartphone operating systems have failed to do. But it’s not perfect and, let’s face it, nothing is ever perfect on launch day.

The Pre is emerging as a polarizing device, even more so than the G1 (which everyone agreed was kind of beta), probably because it’s the closest thing to a legitimate threat that the iPhone has faced. Who wouldn’t get defensive? With strong sales in its first two weeks and an entirely new OS for developers to do their thing with, it’s strong out of the gate but controlled — because the jockey is holding the reins tight. Palm didn’t expect a dynamite launch or a million app sales in a week; what they’ve got so far is, if we can believe what they say, pretty much what they’d hoped for.

Of course, the TechCrunch network is a treasure trove (a rat’s nest, some would say) of opinions, and we have been known to attack the Pre (savagely and repeatedly) despite our interest in it. The app sales numbers for the Pre need more context than a direct comparison to the iPhone App Store, but that is an important data point, so let’s at least do it thoroughly.

We’re not sure if there’s a direct connection here or not, but here’s the way we saw it: PreDev Wiki opens the floor to anyone looking to discuss tethering the Pre, then nixes the topic at the request of Palm. Just hours later, the first tethering solution has gone up. Coincidence? Did someone get a spark of motivation after the discussion got pushed under the rug? Either way – tethering works!

Got a Pre? Like Nintendo? If you fit in the overlapping intersection of that particular Venn diagram, then have I got some good news for you. Some enterprising individuals over at the Pre Dev Wiki have gotten a NES emulator up and running on the Palm Pre.