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12/10/2007

Dead Brand Walking

Palm_pilot Last weekend I was walking through Washington's Union Station when I saw the Palm Store and decided to pop in for a visit. It's hard today to remember just how innovative Palm was during its mid-90s heyday. Also difficult to reconcile the tepid offering on display at the Palm Store with the, revolutionary spirit of the original Palm Pilots. Just after Apple failed with its Newton handhelds, Palm brought a device to market that was simple to use, elegantly designed and, most import of all, unlike anything else.

These days, Palm can't get a break. Earlier this year it squashed its Foleo product before ever bringing it to market. The stock price has fallen by 2/3 since that announcement. On Friday, the company announced that it would miss earnings expectations because of certification delays with a new product (likely the "yawn-worthy" Treo 755p for Verizon Wireless). As is the way with these things, even the good news is bad news; Palm's budget-minded Centro has been selling well, but its slimmer margins have further hurt the financial picture.

Trying to think about what I would do with Palm is a challenging thought experiment. The company is surrounded by a mean gang of competitors, both for business customers and consumers. It's clear that in order to survive, Palm needs to make some quick decisions on what its going to be...the company no longer has the luxury or the scope to be a broad-ranging player.

Centro's positioning as an entry-level smartphone is not a bad one considering the space. However, it will need to do more than simply be a Junior Treo if it is to compete with the Sidekicks, Helio Oceans and next gen iPhones.

One difficult decision (that should have been made two years ago) is the OS. Consumers are not willing to make handset decisions and operating system decisions separately, nor should they be. Job one: figure out which operating system to go with (Win Mobile, Palm Garnet or Linux) and stick with that decision.

All hope is not lost. The Palm brand still has some gasps of life in it and in today's short-memory marketplace, product innovations trump all else. The company's record of waffling and making really stupid decisions doesn't give a lot of hope, but perhaps the smart folks at Elevation Partners can bring in some tough love. Palm needs it. 

December 10, 2007 in Brand volatility, Digital lifestyle, Technology | Permalink

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