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Comments on: 1 Million Zire Handhelds Sold and Counting

Palm Solutions Group announced today that sales of the original Zire handheld have passed the 1 million mark. The Zire has been the fastest-growing handheld in Palm's history.
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i believe that

orol @ 5/27/2003 11:33:59 AM #
.. because i have seen so many zires even in women hands ! i mean they didn't have any clue about hotsync or so but for them it was a cheap organiser ..

RE: i believe that
Spell @ 5/27/2003 2:13:48 PM #
I know what you mean by "even in women's hands," but at the same time, as a tech saavy woman, that rubs me the wrong way. No, I'm not trying to start a gender war. I just think it's fairer to say, "in the hands of the not so technically inclined," or even "in the hands of those not quite up to programming their VCRs," instead. Ignorance (or perhaps to be more fair, lack of interest) is not gender-specific.

Yes, women stereotypically are less tech saavy; but, you know, some day, I'd like to walk into Radio Shack and not be treated like a moron just 'cause I've got breasts.

RE: i believe that
crustyedgeofinnovation @ 5/27/2003 5:14:42 PM #
i'm a man and I have breasts too, nananananana.
So don't be all like, oh i'm so cool and savvy because I have boobies.

Yeah, talk to the hand.

RE: i believe that
JonAcheson @ 5/27/2003 5:53:59 PM #
Spell,

1) As a member of the human race, I apologize for "crusty".

2) Radio Shack treats EVERYONE like an idiot. Don't take it personally.

Jon Acheson


"All opinions posted are my own, and not those of my employers, who are appalled."

RE: i believe that
elo @ 5/27/2003 6:21:30 PM #
Spell,

You took the first comment very differently from the way I did. I took it as simply noticing that he was seeing a number of Zires used by women, where PDA's typically are used disproportionately by men. It is probable that buyers of this particular device aren't particularly technically inclined, but that would be true of people from either gender.

It is factual that this product is reaching women in greater numbers than by (all) other PDA's, and that this PDA is directed at both women and people who are less technically inclined (these characteristics can exist in the same person). I think that noticing that, and observing further that male PDA users are somewhat more likely to be power users, does not in any way disparage women. To assume on the basis of statistics (however true) that a *particular* women automatically would be more ignorant than a *typical* male user would be fallacious.

By the same token, it would be noteworthy if an unusually large number of males suddenly were buying a typically female-dominated device. Here, it might also be possible to infer correctly that the typical male was less inclined to use the device to its potential than the typical women. Again, however, this would be merely an examination of the probable.

elo

RE: i believe that
mikecane @ 5/27/2003 9:01:38 PM #
White goes with anything.

But it's true: I've also seen more women buy the original Zire than men.

I think if Palm reintroed it with a backlight, they'd sell *two* million.

RE: i believe that
blueBlade @ 5/27/2003 9:28:27 PM #
The darned thing is sold in 'Target' what do you expect?
RE: i believe that
RhinoSteve @ 5/27/2003 11:31:38 PM #
Well ok how about this,

"... even with cute, non-technical women with a love of children above career that work via aestetics above technology are using a Zire."

that way we can distinquish those women who are in a more traditional role and those brave one's in a man's world?

That works for ms. ;)

RE: i believe that
Spell @ 5/28/2003 1:37:00 PM #
Based on the responses, and June Cleever or k.d. lang offered up as my only role options, I humbly withdraw the original comment.

So, uh, electronic paper -- when do you think that and microdrives will make PDAs as tiny as playing cards?

RE: i believe that
ray00pal @ 5/29/2003 12:33:16 AM #
This is nothing to be proud of. This shows that palm users are cheap while clie users are more quality oriented. However, if I am the CEO of Palm, I rather have it the other way. This is why palm is not making money.

But what about profits?

nrosser @ 5/27/2003 12:08:16 PM #
I've seen the 'units sold' vs 'profit per unit' argument debated here and every other place, so I won't start that rat hole going, but I'm undecided as to the value of having 1M Zires sold. Of course, it's great for palm to access that untapped market, but on the other hand, are they making money in doing so?
Since their channel (the Targets of the world) is great at getting cheap product out there, I would tend to say 'yes', but I don't know for sure.
I'm sure Palm would rather have 1M Zires sold than, say, 175K. That much I do know.

(on a side note, I saw a Zire 71 at my local Target on Saturday, in the same type of plastic hanging box thing as the Zire next to it - I was surprised to the 71 being marketed the same way as the Zire. Interesting...)

RE: But what about profits?
mashoutposse @ 5/27/2003 12:25:21 PM #
Too bad the revenue generated by the sales of those 1 million Zires are equal to that of, what, 2 Tungsten Cs? ;)

RE: But what about profits?
Be3G @ 5/27/2003 12:40:25 PM #
Admittedly, the amount of profit made by a Zire will probably be fairly little. But think of all those people who'll buy a Zire to try out the "notion" of a PDA, find they like it, then go ahead to buy themselves something that Palm make a better profit on... say, a T|T. That's what happened to me... I originally bought the super-low-end m100, not knowing if Palms were right for me. I was immediately hooked, so one year later I jumped up to the best of Palm's offereings, the m505. And for the record I now have a T|T. :-D

Thomas

Check out the Palm Tungsten|T review at www.comp-talk.co.uk

RE: But what about profits?
sr @ 5/27/2003 1:21:05 PM #
I don't think the profit on Zire is that small, I'm actually fairly certain that Palm makes more money per unit on each sale of the original Zire than Dell makes on the low end Axim, I got this impression from all the articles and figures written on the costs of making a PDA like Zire and Axim. Just think of everything Dell has to pay for in an Axim which sells for less than twice what Zire costs. Zire's tech is several years old and there should be no reason it costs more than $50 to manufacture, even that is a lot.

That said, think of the million Zires out there, whatever percentage of those users upgrade they are much more likely to upgrade to a PalmOS device than the competition.


RE: But what about profits?
royhandy @ 5/27/2003 1:41:18 PM #
I bought a Zire for my wife. She loves the thing. I saw what she was able to do with her Zire and purchased a refurb TT from Palm. I may buy her a Z71 this year. The Zire serves as a great introduction to what can be done with a Palm device and drives sales of higher end units.

RE: But what about profits?
peitron @ 5/27/2003 1:55:08 PM #
Granted that profits won't be as large as in the the late 90s, but nometheless this is huge. This goes to show how some "power users" don't know diddy about the market. A million new Palm users who will soon begin upgrading. By the way, does the $50 promotion apply to the old Zires? I would think many Palm Zire newbies will begin to think about the Zire 71.

_____________________________________________
"Why should I care about posterity? What's posterity ever done for me?" - Groucho Marx
RE: But what about profits?
mikecane @ 5/27/2003 9:03:14 PM #
>>>(on a side note, I saw a Zire 71 at my local Target on Saturday, in the same type of plastic hanging box thing as the Zire next to it - I was surprised to the 71 being marketed the same way as the Zire. Interesting...)


-- er, could it be because BOTH are Zires?

RE: But what about profits?
babynino @ 5/27/2003 11:14:25 PM #
I do support others here saying that Palm is not focusing much on the profit of the Zire but part of a bigger purpose of making these users upgrade to a higher model once they become more attached to it and find its limited functions. Just imagine you already have 1 million potential users upgrading, talking about passive marketing strategy ;)

RE: But what about profits?
Gremmie @ 5/28/2003 1:40:21 PM #
Kinda of a small car theory; car makers don't make good money off compact cars (except the Neon), but they trust that one day they can afford a nice big Hummer. Look at us; "I can't live without my [insert favorite handheld here]." Someone becaomes addicted on a small model, and feels the need to upgrade.

I don't get it, but maybe that is why Palm is #1 and I'm not

Timothy Rapson @ 5/27/2003 6:54:52 PM #
Since I have never been interested in so limited a PDA, I can't figure out this success. I just don't get it.

For the money, as long as you can do so little of what I would want to do on a PDA, I would far prefer a 4 meg Casio PocketViewer, Sharp Yo with 10 meg for $50, Royal Lineo or about any old Sharp Wizard or Casio Boss that would keep appointments and a few (very small) notes. But, that was never what I wanted a PDA for. I want it to create and carry written documents. Anyway, the Zire 71 is worth so much more than 3 times what this Zire is, that I would never buy this $99er.

But, there it is. Congratulations Palm.


Palm is probably especially happy with these results as almost every one was sold at a full profit margin. That is, the Axim cost Dell $170 and they've sold less than 200,000 of them at prices from $152-249. Most of those were sold at $175 during $50 rebate with 10% off sale prices. But, the Zire cost Palm about $35 each. They sell them to all sorts of places for anywhere from $50 (special price for ordering several thousand at one time) to the tire company that gave them away with a set of tires, all the way up to $80 each wholesale to resellers who sell only a couple a month. Palm is making big money on these. Palm has made at least a couple hundred million bucks profit on the low end Zire since introduction. That makes it the most profitable model since the original Ipaq by my reckoning and the most profitable model for Palm since the Vx.

And all just to make me feel like a fool for thinking that no one would ever buy a Zire.

RE: I don't get it, but maybe that is why Palm is #1 and I'm not
Sweetlu @ 5/27/2003 7:42:34 PM #
"Palm has made at least a couple hundred million bucks profit on the low end Zire since introduction."

1 million units x $99 = $99 million.

Consider this....

Step 1 - sell cheap very basic unit to target potential users.
Step 2 - after they get used to it, offer a $50 trade in so they can upgrade their units. More sells for the higher end units = $ & hardly no expense incurred for the offer since they will most likely resell the trade in units.

Pretty clever way to build up brand loyality.

___________________________________
Yankees, Steinbrenner,...... I will never turn to the dark side.

RE: I don't get it, but maybe that is why Palm is #1 and I'm not
Timothy Rapson @ 5/27/2003 10:00:13 PM #
RE Sweetlu's comment

I wrote:""Palm has made at least a couple hundred million bucks profit on the low end Zire since introduction."

Sweetlu corrected:
"
1 million units x $99 = $99 million."


Of course, my math is off by a factor of 10. I should have come up with 20 million.

Thanks.


RE: I don't get it, but maybe that is why Palm is #1 and I'm not
whitemiata @ 5/27/2003 11:14:29 PM #
Don't sweat your faulty math too much...

according to David Letterman's scientific study of the phenomenon... about 50% of Americans are really bad at math. And the other two thirds aren't all that much better ;-)

Alessandro

RE: I don't get it, but maybe that is why Palm is #1 and I'm not
enjolras @ 5/28/2003 11:39:19 AM #
Profit = Revenue - Cost

They most definitely haven't even made $99m in revenue off of these. I have no idea what the actual costs are. The cost to the retailers for these units was likely something like $60.. based on that guess Palm has brought in a maximum of $60m in actual revenue. If these cost $35 to make, then their profit (before operating expenses) was ($60m - $35m) or $25m.. I have no how idea how accurate it is, but much more than the $99m thrown out before.

Palm Taking Advantage Of The Un-Savvy

Sid_Sid @ 5/27/2003 7:04:00 PM #
In some ways, it could be said that Palm took advantage of the technologically naive consumer by selling the Zire at $99.00.
Anyone with a little PDA experience would consider the Zire either over-priced or under-powered.

Palm Taking Advantage Of The Savvy
Satan @ 5/27/2003 8:10:11 PM #
The people that have traditionally been taken advantage of by Palm have been those who bought their so-called higher end PDAs (Vx, m505, m515, etc.) Basic Palms have always been a good buy for what they offer.

You fail to understand that most PDA buyers are not fanatics who's lives revolve around their devices. Most people buy PDAs either because they want a simple organizer for phone numbers/addresses/daily schedule/to do lists (or else because they think they look good). You may be shocked to know most people seem to get by just fine without adding any third party software (other than the occasional game) to their Palms.

Like most consumer electronics that have been around for a while, Palms have now reached the "commodity" level. The problem for Palm is that these basic PDAs can potentially cannibalize sales from more lucrative higher-end models. If the average person in the market for a new PDA is honest about how they will really use their Palms, most would actually be satisfied with a very basic PDA.

Can it be true?

ganoe @ 5/27/2003 10:58:58 PM #
I mean come on. We all know that monochrome PDAs are dead, and Sony's latest high-end model will be the bestseller of the year.
RE: Can it be true?
RhinoSteve @ 5/27/2003 11:37:58 PM #
Well you must remember that the Palm-a-rati that reads this site is less than 1% of all Palm users. Thus, the opinions here do not reflex the general consumer market. Neither does the entire Internet IMNSO.

RE: Can it be true?
amflores @ 5/28/2003 11:27:54 AM #
C`mon Rhino, we all know Ganoe was being sarcastic to all of us....

(isnīt he?)

Sony alredy owns Palm.

Satan @ 5/27/2003 11:55:44 PM #
The Zire is nothing more than an attempt by Palm to expand the handheld market. The profit generated by Zire sales in the past year is trivial, but bringing new consumers into the fold with a basic model might eventually pay off in more sales of high end PDAs in the next two years.

Sony alrady controls Palm, so they're presumably behind this strategy. Two years ago, Palm was on life support. They wouldn't still be here unless Cousin Sony decided to keep them around. Now that Sony/Palm have effectively removed Handspring and HandEra from the PDA marketplace, Sony will eventually consolidate their position in the high end and as an entertainment device. The Palm name still has some cachet, but unless Sony decides to rebadge CLIEs with the Palm name, eventually "Palm" will primarily be producing the bargain basement $50 - 100 models, leaving Sony the rest of the market.


Conspiracy Theory 101


A little history, lest we forget:

http://www.palminfocenter.com/view_story.asp?ID=4324

http://www.palminfocenter.com/view_Story.asp?ID=1889


Wonder who's making those Palm color screens these days...

RE: Sony alredy owns Palm.
cyruski @ 5/28/2003 10:54:48 AM #
and hp/compaq owns sony i guess..

RE: Sony alridy owns Palm.
Satan @ 5/28/2003 2:03:31 PM #
No, Grasshopper. That is not what I taught you. Once again, you have shamed your family.

Sony already owns Palm. They provided Palm with the money to survive the past two years and have also made Palm's color screens for years. Palm is just a brand name for Sony hardware. Just ask Palm. They'll tell you. Eventually.

Right now, no-one knows what consumers (typical buyers rather than the people reading sites like this) really want and are willing to pay for in their PDAs. So Palm/Sony are throwing out as many permutations and combinations as possible, hoping to see what sticks. Form factor/resolution/screen size/Graffiti/Virtual Graffiti/keyboard/MP3/wireless/digital camera/voice recorder/cellphone/microwave/popcorn maker/etc. - it's all a guessing game. But depending on what sells, Sony/Palm will quickly narrow their focus. PalmNet, Web Clipping, Springboard modules, monochrome screens etc. will all go the way of the dinosaurs as only the fittest ideas survive. Some good ideas will also get thrown out with the bath water. (What ever happened to Actual Software's MultiMail PRO after Palm took over the company? Will anyone remember the HandEra and their AutoCF program in a year? Did the Springboard architecture deserve to be abandoned?)

Handspring and HandEra tried to battle the mighty Sonyzilla and are now licking their wounds. Handspring management at least had the sense to know when to cut their losses and stop competing with Palm/Sony. HandEra was too naive/arrogant to give up and is now moribund. At least they still have some of their engineering talent left. The may eventually get revenge on Palm/Sony by moving to a certain other platform and advancing it the way they did the Palm OS. Palm/Sony should have just bought HandEra last year. HandEra could have actually produced a solid PalmOS 6 by now and more importantly, would not pose a threat to Palm/Sony.

You are dismissed, Grasshopper.

RE: Sony alredy owns Palm.
palmwiz @ 5/28/2003 6:48:46 PM #
Handera are a contract design and manufacturing house -- they did the case for the Palm III and some other work for 3Com back in the early days. Marketing the 330 themselves was an aberration, and they are now back to their usual mode: designing and building PalmOS hardware for other manufacturers, most recently Garmin.

RE: Sony alrudy owns Palm.
Satan @ 5/28/2003 8:28:24 PM #
Not many people know how good TRG/HandEra was at engineering solutions for Palm. Hardcore Palm users in late Nineties may remember TRG's "SuperPilots" and the xtra xtra memory boards. Here's a list of some of the other things they have done:

http://www.handera.com/services/Projects/PalmPartners.htm


But HandEra threw all their eggs into the Palm basket and ended up getting shafted by them. They deserved better than this.

http://news.com.com/2100-1001-231459.html?tag=bplst
http://news.com.com/2100-1040-256216.html?tag=rn
http://news.com.com/2100-1041-997317.html?tag=mainstry

RE: Sony alredy owns Palm.
mikecane @ 5/29/2003 12:13:53 AM #
Satan, you give good message. Nowe please go smite the traitorous abosco!

never thought it would sell

antikryst @ 5/29/2003 3:42:58 AM #
when the zire came out...i honestly didnt think it would sell at all.

no backlight??? low memory??? i guess people who bought it didnt know any better.

at the time it was released you were better off purchasing a 2nd hand palm vx on ebay.

well...just a thought.

RE: never thought it would sell
hoodoo @ 5/29/2003 5:01:59 PM #
True, but I doubt most people who bought the Zire were actively searching ebay for a Vx!! The whole point I believe was to attract new Palm users, hence the "Target" market and Wal-mart etc in blister packs.

A Million Dusty Zires?

Gekko @ 5/29/2003 6:17:30 PM #
I wonder how many of those million Zires were given as gifts to people who didn't really want/need them or were bought on a whim and thus are sitting dusty in desk drawers all around the world never to be used again?

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