Prediction: Palm Will Switch to Android (and Then Fade Away)
On paper it was a good week for Palm — they announced at CES that they’ve struck a deal with Verizon and the next day their stock price ticked up. However the whims of the stock market can be a poor predictor of how a company does in the long run and can miss the big picture. Frankly the company that owned this week was Google with the announcement of the Nexus One: And that spells the death knell of Palm.
Frankly you knew this day was coming a while ago: In retrospect palm had a small window of time to work in — that period between Apple introducing the iPhone and Google entering the marketplace. And to Palm’s credit at first they did a great job by brining over many folks from Apple and being willing to reinvent themselves. But sadly that alone enough to be a disruptive force in the marketplace which was what was needed to succeed. It wasn’t enough for Palm to be just a little bit different than the iPhone, it had to give you a killer reason why it was better or open up some niche that wasn’t there before.
Above: The palm Pre zen ads were pretty, but they didn’t give you a reason to switch.
The lackluster pretty advertising that followed told the story: Like Vista copying OS X the Palm was a great clone, but there was no good reason for an iPhone user to switch brands. In fact the only innovation was the cat-and-mouse game Palm played to open up iTunes. But that missed the entire point: What was needed was a reason to make you sop using iTunes in the first place.
And Google was the one company that can give you that reason. While they didn’t have a lock into entertainment (in fact it’s a weak point) their software on the net is the killer reason to get an Android phone. At this point so many folks are using Google software (from Gmail to Google Maps) that there are multiple things that Google does better than Apple. In fact I would argue that Google has a monopoly on search, which makes anything that Palm has to offer seem non-existent.
Above: In 2005 Palm switched to Windows with the Palm Treo 700w — my bet is that you’ll see history repeat itself with Google.
So what will happen to Palm? My gut tells me that they’ll take a page from their own history. Back in the good old days Palm was the company that owned the PDA space. In a bit of historical irony they took that title from Apple by making a disruptive product that was just better than the Newton. They managed to ride that into the first era of smartphones, but then they let their software age poorly and had Microsoft eat their lunch. I’ll never forget the result: There came that one sad day where Palm introduced a smartphone running Windows, which was then followed by them selling off their operating system. And at that point there was no point in being a Palm user.
So here we find ourselves in the year 2010 and you’re about to see Google playing the role of Microsoft this time. The Droid did well on Verizon, but with the Nexus One they’re a steamroller on steroids in the marketplace. And when you add to that they’re getting into the OS game means that now Apple and Microsoft are on red alert — which means that Palm is already finished before they started.
Frankly Apple won’t be licensing the iPhone to anyone and it’s questionable if Microsoft seems like a good bet at this point in time — so Palm will be forced to go with Android thus repeating history. It’s that or they’ll be out of business or be acquired by the likes of a Microsoft or RIM if they’re lucky.