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6/5/09

Gauging the Palm Pre's success: It'll take time


Posted by Larry Dignan on ZDNET

Palm’s long-awaited Pre device is available this weekend and the launch will be closely watched. The lines at Sprint stores will be analyzed. Analysts will guess Pre units sold in the first weekend. And the Pre will be compared to the iPhone launch repeatedly. All of those short-term mileposts will miss the big picture: Gauging the success of the Pre will be a long-term endeavor.

Oh sure, Palm sales on the first weekend will be closely watched, but shortages are expected. In fact, Pre units are likely to be hard to get. But that generates buzz. Add it up and the Palm Pre launch is likely to be modest—and possibly deemed a failure following all the strong reviews. On Monday it’s likely that folks will note how:

* Palm failed to move millions of Pre units;
* Palm doesn’t have what it takes to compete;
* Palm doesn’t have the apps;
* Palm relies on Sprint.
* And Palm couldn’t come close to Apple’s iPhone launch.

All of those gripes will probably be accurate, but the real read on Pre’s impact will come over the period of weeks and months. Research firm Morgan Joseph expects Palm to ship 1.9 million units in calendar 2009 and 3 million in 2010.

So how do we gauge the success of the Pre? How the following questions are answered will tell the Pre tale:

Did the Pre save Palm? You could argue that the Pre has already saved the company. Let’s face it: Without the Pre’s big splash at the Consumer Electronics Show in January Palm would be toast. Since that splash Palm has become relevant again. The company is worth more than it was, it now has a stock price it can use to raise capital and as long as the Pre isn’t a total disaster Palm has a puncher’s chance in the smartphone market.


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