Re: [NTLK] OT Palm Pre

Hi,

When I'm comparing things, I often find it helpful to take the gold
standard, and the new guy, and flip them around. So consider for a
moment the following alternate reality scenario, where Palm Pre and
the iPhone's relative positions in the marketplace are flipped.

Palm Pre was the first major smartphone with a touch sensitive full
screen interface. The iPhone, which has been competing with (and
ultimately losing to) RIM for the last several years, has only
recently announced their new product. The Pre has already become a
major competitor to RIM, and is considered by many to be the top
product across the board.

The Pre has been out for about two years. They invented the market,
but Apple stole the smaller sized PDA market away from them in the
early 90's. This is seen by many as the 'return of the king' to the
PDA world.
The iPhone itself was introduced this quarter, but Apple has been
making the iPhone in various other incarnations since the early 90's.

When the latest Pre shipped, there were lines around the buildings
that sold them, all over the world.
When the iPhone shipped, you could pick them up all over the place,
with virtually no lines. Apple played it down though, as the iPhone is
a serious phone, and doesn't need 'hype' to sell it. It's
technologically superior, after all. It has a better operating system,
despite that Apple's previous several versions of the iPhone operating
system were tossed aside when they made this one.

The Pre has an 'app store' that already offers 50,000 applications,
from indie through big name developers, in the short time since it
launched. Those developers are starting to spend real money on
advertising. And anyone can join in the fun, as the developer tools
are free, and only a $99 fee is required to start selling apps in the
app store. It's the Software, Stupid! might not have been said first
at Apple, but it's definitely driving their profits now.

By comparison, the iPhone has no app store, and no public SDK. Well,
it has an SDK, but according to Apple, no one would want it right now,
it's kinda a mess. But there'll be one soon. And an app store after
that, of course. And it's going to be better than the Pre one, because
Apple can learn from Palm's mistakes.

The Pre's interface is considered revolutionary, because there really
weren't any competitors who were doing something this concentrated at
the time it launched. Hundreds of patents were filed by Palm to
protect various things in it, from the way you click and drag on
things, to how the device decides where the center of a touch is.
The iPhone has a few patents around it, but Apple and its carriers are
really flying the 'it's the same, but better' flag pretty high.

Palm openly stated that running multiple apps degrades the performance
of whatever app you're currently using, so they came up with several
ways around this, most of which include only allowing one 'userspace'
app to run at a time. Hacked versions of the Palm Pre OS have shown
that while you can run multiple apps, it does in fact get slow.
Apple has openly stated that you can run numerous apps at the same
time, but conspicuously leave out things like how long it takes to
switch from app to app, when a bunch of them are running
simultaneously. That said, you won't see much of a problem right now,
because there are no real third party apps yet, because there's no SDK.

Palm itself is spending millions on advertising the app store, which
in turn promotes the third party app developer community.
The iPhone has no app store, but it doesn't matter, because the iPhone
is a 'serious phone' and does many important things out of the gate.

Palm just announced a non-holiday quarter profit of almost 2 billion $$
$ US. In the same quarter, they sold 5.2 million Palm Pre's, up 626%
from the same quarter a year ago.
For the same quarter, Apple posted a $20.1 million $$$ US gross
profit, but part of that was from a younger product. Apple wouldn't
say how much. They also posted a Net loss of $105 million. In this
first quarter they were available, they shipped 351,000 iPhones.

By comparison, the launch of the substantially more expensive Pre saw
unit sales of 500,000 to 700,000 during the same quarter, two years ago.

------

Okay, done. That's just the sales and marketing figures, but even
based on that, would anyone really say Apple's iPhone was the Palm Pre
killer? Would anyone even consider the iPhone to be a *possible*
threat to the Pre?

-Chilton

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Received on Tue Jul 21 20:40:08 2009