Palm Lowers the Price on the LifeDrive

This may seem a little self-serving, but it's a convenient place to announce that we just launched MobiTV for the LifeDrive. The TX has been out there for a week or so already and is doing well. See http://www.mobitv.com/palmwifi.html for details. Make sure to update to LifeDrive Update 2.0, the original ROM has some nasty bugs with SSL.

On a personal note, I think LifeDrive 2 has the potential to kick ass. I could duct tape an iPod nano to the back of my TX and it would be only slightly more expensive and a lot faster than a LifeDrive 1; it doesn't seem to make sense to go with a hard drive approach seeing how flash prices are plummeting. I don't necessarily think you need massive storage either to make this work. Customers might still not buy a LifeDrive with 5GB of flash in a case half the thickness and three times the speed (without the stupid HDD in there), but they might think twice before buying an iPod video. That's a pretty lucrative bunch of customers if you can get them.

Not to throw a wrench in all you guys joy, but I have to disagree here. Yes, the LD could have some improvements such as better memory management and better video integration. But, the LD offers things that the iPod and the Archos can only dream about and may never even come close too.

Such a device has just about everything AND the kitchen sink to boot. C'mon, would you rather watch a 2.5 hr on a 2" iPod or a gorgeous 4"HVGA? What kind of software base does the archos have? How are the PIM apps etc etc etc. All three have advantages and disadvantages, but each is a different device for different tastes.

For me I would choose the LifeDrive hands downn for my own personal use. Of course I'm a PDA junkie, so throw that out of the sample. The LifeDrive is loaded with everything except cell technology. Just line up everything that it does against the other two and it would get ugly quick.

Yes, I would like to pocket the iPod better and love the massive HDD in the Archos. But if Palm will deal with the memory bottleneck next time and offer DVD x-fers, TiVo type captures or iPod like vid service, along with 8-10GB microdrive or flash ... it will be a hit IMO.

I would have it now, but she's just a wee bit too big for my PDA in wallet tastes. So is the TX imo.

Pat Horne; www.churchoflivingfaith.com

I'd consider the LD if they shoe-horned a 20 or 40 GB drive even if it still did have some of the delay issues. With freeware that lets you watch avi, mpeg, and divx movies at full screen, this would kill interest in the video iPod with it's itty bitty screen.

Actually, that's not quite true. Media was a considerable portion of Palm's sales strategy for the LD. Their PR materials emphasized music, pictures, and video, as well as business documents. That's the big reason why they got roundly denounced for failing to include a video player.

Anyway, I don't think that the LD is being either dropped or replaced, at least not at the moment. Sometimes a price drop is just a price drop. They probably wanted to see if it would sell better at a lower price. Besides, February is a very off-axis time for a Palm release.

We all have to remember that the LD was probably just a concept unit developed to see how well a product line of the type could do. From what i've heard, the LD has actually sold quite well, and therefore we can probably expect a new model to be released with somewhat improved specs (in keeping with palm's tendency to slowly upgrade the product lines).

Who knows, maybe it will have a better memory architecture.

Foo Fighter, you are mistaken.

The LD, to the best of my knowledge, has actually sold quite well for a $500 handheld. Dont be so quick to discount the device... Palm has NEVER lowered prices simply to improve sales... there is always an alterior motive. Considering this price drop is rather early, i'm going to guess that palm will try to shake up the line a little bit... they may actually release something around valentine's day... it would actually be pretty good timing.

Palm's Handheld business is hardly evaporating. The thing is, the trends in mobile technology have been focusing around phones, and therefore palm has paid much attention to it's formerly fledgeling Treo line. My guess is, however, that palm will not abandon the handheld market, nor will it continue to concede marketshare. I think palm is readying for a comeback... all the signs point to it.

> "The LD, to the best of my knowledge, has actually sold quite well for a $500 handheld."

No it hasn't. It ranks at the bottom of Palm's product matrix. Unless Palm has secretly been selling millions of these things unbeknownst to analysts, I think it's quite fair to proclaim this product a dud.

Nobody buys $500 handhelds anymore.

> "Palm has NEVER lowered prices simply to improve sales..."

Uh...yes they have, numerous times in fact. Sometimes price drops are utilized to push inventory, in preparation for upcoming products. Other times prices are slashed to adjust to market conditions (i.e. poor sales).

> "there is always an ulterior motive."

Slashing prices to push inventory is an ulterior motive. It's called business strategy.

> "Considering this price drop is rather early, i'm going to guess that palm will try to shake up the line a little bit... "

Early? Price drops always come in January. That's part of Palm's strategy to clear inventory in preparation for Spring product rollouts. You can't announce new products with channels still stuffed with unsold inventory.

> "they may actually release something around valentine's day... it would actually be pretty good timing.

Valentine's day? Palm never announces new products in February. They announce in March or April.

> "Palm's Handheld business is hardly evaporating."

Sales data says otherwise. The Smartphone segment is where Palm is investing because that's where the revenues are. Their financial results illustrate this fact.

> "The thing is, the trends in mobile technology have been focusing around phones, and therefore palm has paid much attention to it's formerly fledgeling Treo line."

Uh...yeah. Because that's like...where the sales are at. It hardly makes sense to focus on PDAs when consumers don't want them, while Smartphone sales are white hot...does it?

> "My guess is, however, that palm will not abandon the handheld market, nor will it continue to concede marketshare."

Concede marketshare? The marketshare is going to Smartphones. Palm will follow this market trend by offering MORE Smartphone products, and FEWER PDA devices. It's a simple matter of business. Palm isn't going to keep churning PDAs out just for grins. PDA sales now have fallen to the point where a questionable ROI exists.

> "I think palm is readying for a comeback... all the signs point to it."

Uh..first of all...what signs? A fifty buck price slash on a poor selling PDA gives you the impression Palm is staging a major comeback in the PDA space? Oi!

Second, I don't know what rock you've been residing under for the past year or so, but Palm is ALREADY on a comeback, and have been for some time now. They currently have the hottest selling Smartphone on the market today. Their financials are rock solid, thanks almost entirely to Treo sales. Things have never looked better. Where exactly do they need to come back from?

The PDA market is a dying space. It's commoditized, margins are razor thin, and it's transition towards convergence (Smartphones.) You're going to see fewer product releases in that space. The PDA is a dying form factor. Like it or not, that's reality. You can keep praying all you want for cool new handhelds, but there will NEVER be a comeback for traditional PDAs. The market has spoken...it wants Smartphone.

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Editor, http://Pocketfactory.com
Contributing Editor, http://digitalmediathoughts.com

Just dreaming but what about a Cobalt Lifedrive with real multi-tasking apps? If you were going to build a cobalt machine, this would be the platform to make it worthwhile.

David

The LD, to the best of my knowledge, has actually sold quite well for a $500 handheld. Dont be so quick to discount the device... Palm has NEVER lowered prices simply to improve sales...

Not quite. Last point first, but Palm dropped the price of the TE2 from $250 to $200 without replacing it. They also dropped the price of the TC a couple of times. Palm does indeed lower prices to improve sales. Everyone does, and Palm is certainly no exception.

Anyway, I think you'd be hard pressed to show that the LD sold well. As far as I've seen from monitoring sales numbers (sales usually spike after the release of a popular model) the LD hasn't done much of anything for Palm's sales.

Foo, I disagree that nobody buys $500 handhelds. Look at the success of the FSC Loox models in Europe--they're bringing out a new one soon that includes BT 2.0, 802.11g WiFi, VGA, 624 MHz processor, 256 MB of flash, and SiRFstar III GPS. Agreed that many people in the US don't buy $500 handhelds, but that's more an issue of demand versus features. The conventional handheld space in the US is owned by lower-cost devices, and most people won't spend the extra to get more features. That doesn't mean that $500 handhelds are dead, it means that they are--as they have always been--a select market segment.

> "Foo, I disagree that nobody buys $500 handhelds. Look at the success of the FSC Loox models in Europe..."

I was speaking in terms of US market. Handhelds still sell well in Europe. But here in the states, high-end mobile devices are a niche. Problem is...PDAs, as a device category, are a niche as well.

> "Agreed that many people in the US don't buy $500 handhelds, but that's more an issue of demand versus features. [snip] The conventional handheld space in the US is owned by lower-cost devices, and most people won't spend the extra to get more features. That doesn't mean that $500 handhelds are dead,"

Not entirely. Cheaper devices are most popular, but consumers in general aren't buying them anymore. And the numbers decline with each passing quarter.

The problem is that PDAs are being voted out of consumers pockets by other devices like Cell phones and iPods. In this new environment, PDAs no longer fit. Notebooks are cheap. Cell phones perform most the same tasks as PDAs, and digital audio devices like the iPod hold entire music collections compared to the scant storage capacity of SD-based PDAs. And these are the devices that are squeezing the PDA of out of peoples pockets. There's just no room on this life raft for LifeDrive or any other PDA.

Then there is the cost factor. The price for living the "digital lifestyle" is going up with the addition of more gadgets. As such, consumers are forced to choose what is most compelling to them. The devices that everyone wants are Notebooks, iPods, Cell phones, and digital cameras. The PDA isn't even on that list anymore. For that reason you're seeing traditional PDA sales evaporate. Retailers are dumping them because consumers don't want them The disappearence of mobile devices from retailers is extremely significant and often gets overlooked here. That is an omen.

People here are too focused on the past, and too fanatically devoted to their devices to see past their own hands. Reality can be a cold dark place. And it's going to get a lot colder and darker around here in the coming year.

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Editor, http://Pocketfactory.com
Contributing Editor, http://digitalmediathoughts.com

See medevilenemy, Foo can be even more gloomy that I can ever be ;)

Surur

They said I only argued for the sake of arguing, but after an hour I convinced them they were wrong...

We had a thread earlier where we spoke about saving PDA's by promoting them as media players. Fujitsu Siemens has won market share by adding features, such as VGA screens, GPS built-in, USB host and small size. Below is a picture of an MP3 kit for the upcoming Loox N and C series.

http://212.66.5.7/mediaserver/media/16107/U0402-PL-MP3-Kit-02_lo.jpg

It consists of a remote control, silicone slip case, lanyard and in-ear headphones. Very Sony-like and also very practical.

As Foo said, devices have to fight for pocket space. FSC has not conceded the PDA space yet. The FSC Pocket Loox series is in fact on the offensive. The absence of even the Camera Companion for the LifeDrive indicates that Palm has given up the fight already.

Surur

They said I only argued for the sake of arguing, but after an hour I convinced them they were wrong...

Foo - well said!

> "plus de choses changent plus qu'ils restent la même chose -- google"

Huh? Everything has changed, nothing has remained the same.

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Editor, http://Pocketfactory.com
Contributing Editor, http://digitalmediathoughts.com

You seem to have misread what I posted. You're discussing a completely different topic; which tech is better. That's not at all what I was referring to when I talked about consumers voting with their wallets. It's not an issue of "which tech is best", it's a matter of which tech does the consumer want. Is the iPod a better tech device than a Palm? Probably not...but the true answer is...it doesn't matter. The fact is consumers are not buying PDAs anymore. That fact is inescapable. PDA sales are desintigrating, and you can ask any retailer why they ceased carrying mobile devices and you'll get the same universal answer; "people aren't buying them anymore." Like it or not, in the eyes of consumers the PDA is a dead technology. And we can sit here all day pondering what new feature to add that might change that perception, and no matter what clever ideas we might pose, the end result would be the same; nothing.

The fact that my Treo or TX is vastly superior to any cell phone or iPod is completely irrelevant. The bottom line is that consumers are buying the latter and not the former because those are the products they want. Consumers buy iPods because they want to listen to music. They buy cell phone because they want to communicate. They buy digital cameras because they want to snap pictures and capture moments. They aren't buying PDAs because they don't want to carry around an unnecessary (and expensive) device just for storing address books and calendars, especially when the above devices I mentioned (like the cell phone) can already serve those purposes. This is why Palm and other mobile device vendors are hauling ass to get into Smartphones. These companies (those who are smart and gauge the market accurately) know the only hope for growth (or survival) is in leveraging all these features into an integrated device that combines these popular devices into one.

The dedicated device (PDA) doesn't have a future. It's the VHS of mobile technology.

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Editor, http://Pocketfactory.com
Contributing Editor, http://digitalmediathoughts.com

Foo wrote:

Cheaper devices are most popular, but consumers in general aren't buying them anymore. And the numbers decline with each passing quarter.

That not really accurate. People keep saying handhelds are dead, but they're selling about as well as ever. Yes, conventional handheld sales (i.e. minus the Treo) for Palm and HP are declining steeply, but that has a lot more to do with the fact that neither company has had a really compelling conventional handheld since 2003. A lot of other companies like FSC, Medion, Mitac/Mio, etcetera, are coming in to snap up the marketshare being lost by those two, which is mostly outside the US. And if you include smartphone devices like the Treo, which are really extensions of the conventional handheld, then the situation is better than ever.

Foo, I think that you're focusing too much on the old definition of a PDA as a device. Modern handhelds don't look anything like the old Palm IIIs, but that doesn't mean that the Palm III style PDA died. It just evolved. Looking at the broader handheld computing market, it's the same story. Devices are moving towards MORE powerful, not less. Many handhelds are absorbing phone features--a victory of the handheld, not of the phone. The iPod is closer to being a handheld computer than most people would ever have thought when it first debuted. We're seeing more and more tech focused on computing mobility, which is, after all, what this whole thing is about.

Well, even the idea that 'traditional PDAs' aren't selling as well is not really true - the opnly true thing is that the growth rate (formally double digit) is not as exciting for analyts. But even analysts have admitted that the PDA is not as dead as they once proclaimed. Never mind the millions of Zires and T|Es that have boasts sales on the Palm side of things for last 2-3 years; if you count PDAs as wireleess conneted devices BUT exclude 'smartphones' (as defined by forma-factor), then sales are up for 2005 over 2004.
Of course, here is where we enter the debate over semantics. To me it's pretty simple: would any of you argue that desktop computers ceased to be computers when the internet came along and companies added modems? Of course not - and this is the EXACT SAME THING. A Nokia s60 phone or a Windows Mobile Smartphone is a phone / smartphone. A Windows Mobile Pocket PC Phone Edition such as a Harrier/Audiovox 6600 (or whatever it's branded) - is not. Its a PDA. PDA sales continue to increase.