MikeCooper

Palm's Time May Have Passed

Let me be the contrarian and say I believe this is a good time to invest in Palm. Three reasons:

1. Despite the disasters you name Palm still owns 10-13% of the market. It continues to have strong brand and a following so loyal they will wait almost a decade for a product that promises to barely match what's out there now. Never count a company like that out.

2. Palm is absolutely winning the price battle. The centro is the ONLY smart phone out there affordable purely on its merits. What I mean by that is that it sets a reasonable price for a phone that delivers voice, email and internet services. With RIM or Apple you are paying $200-$300.00 extra for a bit more elegance and big heap of vanity (oooh you have an IPhone, you're a player aren't you?).

This point is important because the smart phone market continues to be a virgin one. Right now it is largely a vanity market. But as internet access becomes more a necessity, and WiMax or LTE becomes ubiquitous, you're going to see a second wave of consumers looking for these services for their own sake. For these consumers, Palm is well-positioned.

3. Buyout possibilities. Palm has always been the subject of buyout speculation. However there large market capitalization and declining market share has traditionally made Palm an expensive and risky proposition. The present financial crisis as largely solved that problem. Palm today would be a reasonable if still large takeover target for a company still looking to jumpstart itself as a player in the post-laptop, broadband world that is upon us. Recall how much Microsoft was prepared to pay for Yahoo. Yahoo's share of the search market and Palm present share of the smart phone business is roughly equivalent.