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Summary:

Earlier this afternoon, I listened in on the Palm quarterly conference call. Although the financials were the first order of business, I was more interested in hearing about Palm’s plans for the Pre and WebOS, since that’s paramount to the future of the company. Not that I […]

palm-pre-rockEarlier this afternoon, I listened in on the Palm quarterly conference call. Although the financials were the first order of business, I was more interested in hearing about Palm’s plans for the Pre and WebOS, since that’s paramount to the future of the company. Not that I had many, but I walked away with no doubts that WebOS is now the rock upon which the company is built upon. CEO Jon Rubinstein reiterated this fact:

“We believe we have pioneered the mobile platform for the next 10 years and beyond.”

Adding further to that theme was a question about future Windows Mobile products. Although no future products were detailed by Palm on the call, the company did say it feels the Windows Mobile 6.1 Treo Pro is one of the best WinMo products out there. However, the actual question wasn’t answered. I’m taking that silence as a no, as the business plan revolves around WebOS.

As far as the elusive Mojo SDK for WebOS software development, Rubinstein says that Palm is

“…eager to widen the SDK access, but will do so in a controlled and methodical fashion.”

The original 30 or so developers that were provided early access have apparently offered feedback to Palm, which is what the company wanted. The company is still tweaking the tools and process. When asked about increased availability of the SDK, Rubinstein said that hundreds to thousands of developers would have access in the next few weeks. By the end of summer, Palm intends to have the SDK open to all who want it. “End of summer” can be interpreted several ways, so when asked for clarification, Rubinstein joking answered, “Look it up in Wikipedia on your Pre.” It was kind of amusing, but that pretty much tells me we might not see wide open access until September 21st rolls around.

In terms of the business plan, market opportunity and financials, Palm thinks there is room for three to five players in this space. With Windows Mobile, Symbian, Android, iPhone and BlackBerry already in the mix, I wonder who Palm thinks will be “out”? There’s no question for smartphone demand: Palm says that smartphones account for 19 percent of handhelds in the U.S. and 11 percent globally, with both figures expected to double by 2013. However, the other players have a head-start and “newcomers” like Intel   have smartphone designs too.

In any case, Palm has some money to burn while we see if the business plans come to pass. Cash, cash equivalents and short-term, liquid investments equaled $255.1 million at the end of the May quarter. That total includes $103.5 million from the recent equity offering. For the quarter, Palm used $72.4 million and feels that they’ll be cash-flow positive in the second quarter of fiscal 2010; just two quarters from now. That could well happen, but the signs to watch are handset sales of the Pre and growth of the application store. Of course, there won’t be much growth there until Palm opens up that SDK and takes the App Catalog out of preview beta. You can view the rest of the financials in this PDF.

Palm could always license the WebOS, but said on the call that they’re not thinking about it at this time. I was hoping to ask about the potential of WebOS on a netbook, but there were too many questions ahead of me in the queue. Palm did say that going forward, they would not be focusing on handhelds, but instead would be concentrating on smartphones. That doesn’t preclude the possibility of other WebOS devices in the future, but the current target market is the smartphone area.

Folks hoping to hear more about the Pre on other carriers or in a GSM version will have to wait. No questions on these topics were fielded, although Palm did remind us that Bell Mobility of Canada will be the next market for the Pre.

  1. I was wrong … I predicted they will fail with their release and I was wrong. At least that is what I read from this and other sources. Good for them! And good for their fans :)

    One thing though Kevin – in the age of Moorstown, webOS might look outdated and belonging to another time, when the platform was still a half way PC.
    I wonder if this has a 10 year potential. Heck a 3 year one.
    Android over Moblin seems like the best bet for me.

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    1. Moorestown on smartphones is a pipe dream for Intel. There’s no way that they’ll ever get power consumption down to as low as what ARM is doing, and with the upcoming multicore Cortex A9, the difference in speed gets smaller and smaller.

      As for webOS staying relevant for years, it’s got the same likelyhood of Android at doing so. In fact, I’d argue its superior interface and the fact that Palm controls the hardware and the software for tying the two together give it more promise both in the current iteration and future versions.

      And it’s very unlikely that third-party apps will stay entirely in Javascript, CSS, HTML for the whole ten-year lifetime that Palm predicts. I give it a year or two before it’s opened up for more.

      It doesn’t really matter anyway though, with developers getting access to root, there’s any number of Linux programs that can be run. All that remains is a method of accessing them via their own cards, and that’ll be perfect.

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  2. I believe they could be on to something with webOS. I love it, very natural and easy to pick up, IMO. But the newness of the device is already wearing off from a hardward standpoint. I really worry about the longevity of the Pre. The slider is a little loose – which is ok – but the two halves “click” together when I use it – like pressing it up aginst my ear during a call. It just bugs me! Also, the earpiece itself is not very good – mine sounds “fuzzy” with certain inflections in voice, like a blown stereo speaker. Annoying. I am really thinking of taking mine back now and waiting. Might try a TP2 or even a new iPhone (to see if ATT’s service is better now in Austin TX). But I am just not feeling that comfortable with the Pre from a hardware standpoint.

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  3. Hording the OS is not going get them very far, they wil sure be able to compet with the other smartphones. Swithcing to the WebOS is not going to happen in droves as there is no “killer app” that is available only on this platform.
    Indeed it will be interesting to see what the SDK is going to brew.
    How about licencing the WebOS to the MID devices? or netbooks without keyboards? or something like this… before Apple gets there first. WinOS is still tooooo thick for the current batch of underpowered CPUs on the market. WebOS has the multiatsking already on and would give a run for its money to anyone with similar offerings.

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