Misfortunes Ahead For Palm

March 22nd, 2010 at 12:00 am

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It wasn’t long ago when the media was awashed with news about the emergence of the Palm Pre smart phone. It was actually given positive reviews by most technology critics and enjoyed great overall media mileage coming towards its launch. But fast forward to the present and its parent company Palm is going through quite a beating and it may not be stopping any time soon. What went wrong?

There may be various factors that contributed to the failure of Palm to capture the market when it launched the Palm Pre. Being touted as the iPhone Killer may not have been a good marketing ploy. Although it may have quite impressive features for a smart phone, it really hasn’t been able to drive the market its way I terms of sale in an industry known for its stiff competition.

One reason why the Palm Pre may have suffered in terms of sales was the announcement of Apple to come out with the iPhone 3G. But it was the announcement that Apple will be lowering older iPhone model prices to $99 that struck a blow to the Palm Pre. Because of it, the market may have been snatched out from under them.

Another possible reason why Palm may have suffered is that it was unable to take advantage of providing synching features in iTunes for the Palm Pre. Their plan backfired when Apple blocked the access for the Palm Pre, possibly pushing away a substantial number of customers in the process.

Another reason why Palm may be currently in hot water is that it may have over expected the market and how easy it would be for people to embrace the Palm Pre along with its impressive features. But then the market is harder to convince than they previously thought. Over expectations led to Palm producing more Palm Pre’s than it sold. According to reports, third quarter sales for the Palm Pre stand at 408,000 units from an overall inventory of 960,000 units that it has released to retailers. This leaves them with a substantial number of excess inventory that it might be forced to absorb at a loss.

Similarly, outlook for the fourth quarter does not seem too rosy for the beleaguered company. Even stock market numbers have recently shown the extent of the problems that Palm is currently facing. The company may be walking on very thin ice for now. It may take an amazing comeback for the company to be able to save its bottom line as well as its future. The problem is that, after several attempts to do so that resulted in flops, that amazing comeback may not happen in time to save Palm from possible disaster.