Palm Investors Await 'Pre'-lude

By Ian Gilson, CFA, Ph.D

This week Palm, Inc. (PALM - Analyst Report) will announce earnings for the year ending May 2009, and we should get some comments on the initial sales of the Pre.

Industry comments on sales so far in June have been less than complementary. Sales were restricted due to an attempt to foster interest and demand. However, the lack of product may have been due to a supplier having yield problems on a critical chip rather than a marketing ploy by Sprint ([[S]] - Analyst Report).

Comments that certain stores had less than five units for sale on opening day, delivery is 10 units a week to stores and units are available at a large number of Radio Shack (RSH - Snapshot Report) stores suggest that initial demand is less than exciting. Reports on Sprint’s subscriber base are not encouraging, but a reduction in churn with existing subscribers buying the Pre would be a positive.

In our opinion, sales are from existing Palm customers and Apple (AAPL - Analyst Report), Research In Motion (RIMM - Analyst Report) and Nokia (NOK - Snapshot Report), all of which have new smart-phones in the market, have not lost market share. However, the smart-phone market is growing and getting bigger, and even a small share of this market would be significant to PALM.

Comments

[Aryamehr:]

Palm Pre vs iPhone 3GS vs iPhone 3G
www.redmondpie.com/spe.../

Jun 23 04:19 AM

[vassar:]

I looked at the Pre and felt that it was pretty much unusable. The screen was hard to read, the keyboard too small and the soft buttons on the screen too hard to hit. That combined with Sprint killed the Pre for me. So I got an iPhone 3GS instead and could not be happier.

Jun 23 09:34 AM

[Aryamehr:]

I tried the iPhone 3GS and felt it was pretty much unusable. The screen was hard to read, it had no keyboard and I kept on making mistakes with the virtual keyboard. That combined with ATT killed the iPhone for me, especially at over $150 per month. So I got myself a Viao laptop instead and could not be happier.

When I need to use a computer I don't think of a Smart phone to replace my small laptop. When I need a phone I need a phone that can do voice/text/email and occassional Browsing on a reliable network at a reasonable price. I pay Sprint $99 for all I can use, Voice/Text/Email/Browsing and $50/mo for my Laptop. If you can get this anywhere else under this price please do advise. Another thing you should note, Sprint allows me access to their 4G platform for the same price.

Jun 23 11:22 AM

[Geddy:]

But Sprint's network is horrible. I know you work for them but please!!


On Jun 23 11:22 AM Aryamehr wrote:

> I tried the iPhone 3GS and felt it was pretty much unusable. The
> screen was hard to read, it had no keyboard and I kept on making
> mistakes with the virtual keyboard. That combined with ATT killed
> the iPhone for me, especially at over $150 per month. So I got myself
> a Viao laptop instead and could not be happier.
>
> When I need to use a computer I don't think of a Smart phone to replace
> my small laptop. When I need a phone I need a phone that can do voice/text/email
> and occassional Browsing on a reliable network at a reasonable price.
> I pay Sprint $99 for all I can use, Voice/Text/Email/Browsing and
> $50/mo for my Laptop. If you can get this anywhere else under this
> price please do advise. Another thing you should note, Sprint allows
> me access to their 4G platform for the same price.

Jun 23 12:28 PM

[COCOViper:]

Worse than Att's network- you're joking right? Sprint has a 3G footprint 3 times the size of Att not to mention all the capacity problems Att has.

Seriously Geddy bring something to the conversation besides FUD for once.


On Jun 23 12:28 PM Geddy wrote:

> But Sprint's network is horrible. I know you work for them but please!!
>

Jun 23 04:48 PM

[ertsfan:]

I don't use a cellphone. When other people keep on interrupting to answer their phone, I feel like throwing their phone in the toilet.

Jun 23 06:27 PM

[Humps:]

Geddy, why are you always commenting on these blogs re:Sprint? Seriously, Sprint's network is very comparable, if not superior, to AT&T and Verizon, especially price-wise.

What's your AT&T or Verizon title, FUD Manager II? Get a life!

Jun 23 09:57 PM