Palm Steps It Up
It has been a good run for both Verizon (NYSE:VZ) and AT&T (NYSE:T) with their latest smartphones; Research In Motion’s (Nasdaq:RIMM) Blackberry and Apple’s (Nasdaq:AAPL) iPhone, respectively. But that could all change on June 6th when Sprint Nextel Corporation (NYSE:S) releases their latest smartphone, the Palm Pre. The Pre will be carried exclusively by Sprint, and will be available in Sprint stores, at Best Buy (NYSE:BBY), RadioShack (NYSE:RSH), online, as well as some Wal-Mart (NYSE:WMT) stores. This new release could be good news for Sprint, the once giant cell phone carrier who has seen dwindling market share with the rise in popularity of both the iPhone and the Blackberry.
Sprint is hoping to bridge the gap between those using a smartphone for personal use and those that primarily use their smartphones for business purposes. The new Palm Pre features the ever-popular touchscreen controls as well as a physical keypad that slides out from below the phone. The phone will run on Sprint’s 3G network and boasts many sought-after features such as personal and professional calendars, e-mail and contact lists. “Pre consolidates your important information – professional, social and personal – into one revolutionary device using an operating system that redefines the experience of living and working wirelessly,” Sprint said in the release on Tuesday.
The main criticism of the Pre has been the price-point. The new phone will set you back $199.00 after $100.00 mail-in rebate, with a two-year Sprint service agreement. A CL King Associates analyst, Lawrence Harris, said that some investors might be disappointed that the phone was not priced below iPhone and that it would not be available sooner.
The highly anticipated iPhone competitor, which won the Best in Show award from this year’s Consumer Electronics Show in Las Vegas is Palm’s attempt to regain market share after losing its leading position, first with the Palm Pilot and then with the Palm Treo. While Palm’s operating system had a 40% share of all smartphone devices in early 2006, by the first quarter of 2009, Palm’s share had fallen to 10%, with Blackberry’s share growing to 36% and Apple’s to 21%.
One key feature of the Pre is that it runs on WebOS; Palm’s new operating system that the company says will change the way we live and work. WebOS allows you to run different applications at the same time, which gives it an advantage over the iPhone. It also allows you to reply to e-mails and social networking profiles through one interface.
“This is an opportunity for Palm to invigorate itself and become a serious contender,” said Roger Entner, a telecommunications analyst with Nielsen. If it doesn’t, he said, “that could mean the end of the road for Palm.” Palm has many loyal customers from their many successful years with the Treo, but the question remains; will the new Pre be enough for Sprint to keep existing customers and lure new ones? Only time will tell but so far the Pre looks to be a worthwhile contender.
