Businessweek published an article stating:
Palm Pins Its Hopes on Nova – The smartphone maker debuts its new operating system, code-named Nova, at January’s CES. Palm says its phones for it will bridge the BlackBerry-iPhone gap … Rubinstein and others say the goal is to create products that bridge the gap between Research In Motion’s (RIMM) BlackBerry devices, oriented to work and e-mail, and Apple’s iPhone, oriented to fun.
Palm had their time and unfortunately, their time is up. When their popular line, Treo, were selling well, I believe their management became too comfortable with their expected growth without too much focus on innovation. The only reason why Treos become so popular amongst corporations was because competition was scarce and IT departments only supported the Treo via their Windows Mobile software. Now Palm is at a position where they are desperate to do anything possible to win even 2% marketshare. When I heard the news of their Nova O/S, I couldn’t believe that this was their strategy to overcome the obstacle that now faces them. Unless their operating system is crazy innovative (i.e. better than Android and iPhone’s OS), there’s no reason to persue this market. They might as well purchase one of the licenses like Symbian and concentrate on developing a very, visually attractive phone rather than throwing more money into the R&D department in developing a new OS that will not be any better than the ones out there. People these days don’t care about the OS because the OS features are supposed to be excellant by standard. People crave aesthetically pleasing phones, phones Paris Hilton would carry. Phones have become a fashion accessory, both in the line of business and personal usage.
As for Rubinstein’s vision of bridging the gap between the Blackberry and the iPhone, the only gap they will bridge is the gap of their ugly phones next to Apple’s, HTC’s, and Blackberry phones that dominate the PDA market today. What they don’t understand is that Android is the blend between the iPhones and the Blackberrys and if they want to compete, they can’t. Why not? Because Palm can’t afford to even buy 1% stake in Google and Google can afford to buy a 100% stake in Palm.
Stock prices do not lie and Palm’s stock is acting like a penny stock.
Palm, here’s some options I recommend:
1. Sell your company to Microsoft. (Probably won’t happen. Microsoft or any potential buyer would probably rather have you go bankrupt and then, buy you out for a lot less.
2. Drop Nova OS before it’s too late. Bulk of your sales was from Microsoft’s Exchange support. Lose Windows Mobile and now you’ve just made enemies with everyone in the mobile market.
