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Sony CEO Wants to Buy PalmSource

In a week full of Sony news and reviews, comes a very interesting interview with Sony's CEO, Nobuyuki Idei at AlwaysOn. In the discussion he reveals that he would buy PalmSource, if they would sell.

The interview touches on a number of topics including Sony's decision to use the Palm OS for it's PDA's and Symbian for their smartphones, "And I can't tell you why Sony has a Symbian OS on its phones and Palm OS on its PDAs. [ Laughs ] Even Bill Gates asked me if I was crazy."

PalmSource Inc, announced in October of 2002 that it had received a $20 million minority equity investment by Sony Corporation. As a result, Sony has about a six percent ownership stake in PalmSource.

Mr. Idei goes on to say, "I really want to own either Symbian or Palm. I want to buy them. [...] My problem now is that as Palm licensee we have to pay them lots of money. " Much more is covered in the interview and I highly recommend you read the full piece. The interview is part 1 of a three-part series.

Sony has been a Palm OS licensee since 1999, and with the introduction of its CLIE personal entertainment organizer product line, has brought to market some of the most innovative and successful Palm Powered products.

Thanks to Mike Cane, kev and j888 for the tips.

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Is this is a good thing?

HiWire @ 3/5/2003 3:05:04 PM #
Pros
- Sony merges its enormous engineering and technological resources with an elegant platform
- Sony is already invested, so it is the "next step"
- Sony has already shown leadership with the Clie lineup; many choices for different needs
- lower product prices without the licensing overhead (?)

Cons
- Possibly less innovation and choice in the Palm hardware market
- Sony's proprietary technology "forced" upon Palm customers - Memory Stick, Jog Dial, Clie buttons, etc.
- layoffs (?)

Palm m505 User

RE: Is this is a good thing?
Morph @ 3/5/2003 3:13:19 PM #
Those are some good questions to ask. It would be interesting to see if they would blend the 2 devices. The size of the Palm, and the sound of the Sony, etc. Could come out with a really good PDA. Yeah they might make all the devices use Sony memory but I don't think that's a bad idea. I for one am tired of many deivces and dozens of different memory to have to use. Some standardizations wouldn't be too bad.

But as we all know that's just pipe dreams.

Probably wouldn't happen anyways. many users like the Palm over the Sony so some seperations would have to be kept

************************************************

For what shall it profit a man if he were to gain the whole world, but lose his own soul.

RE: Is this is a good thing?
ganoe @ 3/5/2003 3:14:59 PM #
No, it's not a good thing. Sony buys PalmSource and I buy a Zaurus the next day.

PalmSource as it is offers as independent as possible of a base for the Palm OS as we could hope to get. It is in PalmSource's current interest to keep the OS as flexible and attractive to as many licensees as possible.

Even from the interview it's obvious that his only interest in buying PalmSource is to save money (and bring in money from other licensees) not to better the platform. Sony would love to get its hands on PalmSource, so it can play the Microsoft game for a change.

RE: Is this is a good thing?
JKingGrim @ 3/5/2003 3:17:14 PM #
I hate SONY. A purchase like that would be the worst thing that could happen to Palm OS. Palm OS is fine where it is. I don't want it to be run by some big ugly monster.

RE: Is this is a good thing?
hudsonhawk @ 3/5/2003 3:21:08 PM #
I think this would be absolutely terrible. At the very least, it would make me switch devices (but that's because of a personal grudge against Sony), but I also think it would criple the platform (dropping SD support for memorystick, etc).

I find it odd that he talks about the inherent apple-like conflict of interest of being the hardware manufacturer and owning the os - but wants to buy PalmOS?

I just don't trust a company with a history off refusing to license their products out to other manufacturers (minidisk, beta) with keeping an OS available and friendly.

RE: Is this is a good thing?
mashoutposse @ 3/5/2003 3:31:04 PM #
Sony has done more to advance things than any other PDA manufacturer. Hi-res, mp3, REAL speaker, native MPEG support, Virtual Graffiti, etc...

I would love for them to buy PalmSource just to piss off guys like one above :D

RE: Is this is a good thing?
HiWire @ 3/5/2003 3:34:10 PM #
I keep forgetting the difference between PalmSource and the Palm Solutions Group. I guess some of those points still apply :-P

Palm m505 User
RE: Is this is a good thing?
ganoe @ 3/5/2003 3:38:41 PM #
> Sony has done more to advance things than any other PDA manufacturer.
> Hi-res, mp3, REAL speaker, native MPEG support, Virtual Graffiti, etc...
>
> I would love for them to buy PalmSource just to piss off guys like one above :D

Only someone like you would say such a silly thing since every PDA "advancement" you listed above came from companies that were not Sony.

No.
sdf @ 3/5/2003 3:41:16 PM #
Sony makes good products, but their developer program is absolutely terrible.

RE: Is this is a good thing?
mashoutposse @ 3/5/2003 3:45:17 PM #
I'm talking about for PalmOS only. Sony brought hi-res first, mp3 first, a real audio experience first, native MPEG support first, and the first widely accepted virtual graffiti scheme. This is correct.

RE: Is this is a good thing?
ganoe @ 3/5/2003 3:55:28 PM #
> I'm talking about for PalmOS only

Well the real speaker and virtual graffiti were HandEra, so it's not correct.

I believe PalmSource dropped pretty much all the Sony APIs for everything you claim they did in your list because their design wasn't generic/general enough. VFS is the only major OS thing I could credit them for.

Anyhow, I could care less about how much hardware Sony can cram into their PDAs. This is about building an OS that MANY licensees will want to put on their platforms. It is not a give the Palm OS to the company who can cram the most gimmicky features into a PDA sized case contest.

RE: Is this is a good thing?
cbowers @ 3/5/2003 4:17:31 PM #
Jeeze I was wary of this (and posted such) when they first invested in PalmSource, and everyone said there was nothing to worry about... I'm still not convinced.

The only thing to stop Sony becoming the Microsoft of the PalmOS market, is PalmSource now. We'll see if they sell out...

"Sony has done more to advance things than any other PDA manufacturer. Hi-res, mp3, REAL speaker, native MPEG support, Virtual Graffiti, etc..."

Bah. Sony has merely copied much of those.

-HandEra originated a PalmOS PDA with a card slot with the TrgPro (at the same time that Handspring brought out the SpringBoard concept). Sony's first card slot enabled PDA didn't come out for another 9 months.

-HandEra originated what was to become the concept of VFS, with their version, FFS, to function with the TrgPro's CF slot

-HandEra originated the first REAL speaker on a PalmOS PDA with the TrgPro. And even way back then, gave it the ability at the OS API level to play native .wav files on cards. HandEra's two PDA models are still among the loudest of PalmOS PDA's, only recently having to share that distinction with Sony models of the past few months. This test was done prior to their arrival:
http://www.deeptec.com/info/misc/alarm.html

-Symbol was way ahead of everyone with integrated wireless in their PalmOS PDA's back in May 1999.

-HandEra released their 330 model with a high-res screen 2 months before Sony's first high-res model. And still the HandEra 330 offers the widest and most numerous font selection at the OS level, from tiny to huge.

-The Virtual graffiti originated with the HandEra 330, and it's only been in the last few months that Sony has copied that feature.

Taken altogether, only recently has any other PDA included a substantial number of the features found in the HandEra 330, 18 months ago. Only in recent Palm and Sony models have you been able to get a device with many of these features in a single device; High-res, real speaker, card slot, virtual graffiti, voice recording, alternate navigation control (Jog dial, nav pad), wireless expansion, replaceable rechargeable Lithium ion battery, a reset pin slot that you can hit with the tip of the stylus...


All of those and more are available in the 330. All of those can be had in other models now too, but you'd have to combine features from the Tungsten T, SJ33, and the NZ90 to get them in another single device.

And yet, due to their lack of CF slots, the immaturity of SD and MemoryStick expansion options, the demise of support for Springboard, and the total disarray of the clip-on/sled market, there remains no other PDA's with the expansion options available to the TrgPro and HandEra 330. Further, those CF expansion options (with driver support) are available in a multitude of brands and models, many of which are available cheaply at your local brick and mortar...

And Palm may well have jumped the gun on BlueTooth. I'm still rooting for it to be an IRDA successor, but they and PalmSource missed the boat on WiFi thus far. Only HandEra supports WiFi solutions from multiple vendors, and offers (while still limited), most complete 802.11b experience with their own OS driver layer, and LAN Status app (allowing the browsing of nearby networks, the signal strength, WEP ennoblement, etc). While Bluetooth continues to strive to get to it's famed $5/chip level in volume, 802.11b is approaching that at the *retail* level, with the expectation of US$10 retail pricing per card this year (already as low as US$16). See:


And for all that, does HandEra assume they do things better than any other licensee and angle to take over the market? Not that they could if they wanted to, but instead they continue the tradition they started in the early days of Palm by contributing designs, specs, and innovation to other licensees to further the platform as a whole (including Palm, Symbol, Alphasmart, and others).

I value Sony's contribution to the platform, but I don't think they need any more favors, or control of the market than they already have. Moreover it's time for PalmSource to allow/court additional *strong* competition to keep Sony honest.

RE: Is this is a good thing?
hotpaw4 @ 3/5/2003 4:39:23 PM #
>Sony would love to get its hands on PalmSource, so it can play the Microsoft game for a change.

Sony is *already* playing the Microsoft game with its Playstation franchise. Either company would love to find a way to take a bite out of the Gameboy franchise.

RE: Is this is a good thing?
sr @ 3/5/2003 4:47:17 PM #
"I just don't trust a company with a history off refusing to license their products out to other manufacturers (minidisk, beta) with keeping an OS available and friendly."

Actually, only Beta was not licensed, after that they've learned their lesson and licensed pretty much everything else. That includes Minidisk (I own a Sharp, Panasonic and Pioneer MD players!) and MemoryStick (it's not only available on Sony devices). And think of other things Sony brought us that you are most likely enjoying today, some of which include: CD, DVD+R, SPDIF digital audio standard, etc.

That said, I'd prefer if PalmSource stayed independent.

RE: Is this is a good thing?
M3wThr33 @ 3/5/2003 5:28:08 PM #
Buying Palmsource would be stupid.
It broke up for that sole reason to prevent bias in development.
And if Sony DID make a gaming handheld to compete with the GBA, it'd use Magic Gate sticks at $60 a pop, have horrible buttons with a battery life of 5 hours without a backlight. Did we forget Nintendo co-developed the first Playstation with them?
Sony has very little ideas in SOFTWARE and sometimes hardware as well.

I don't think you understand the gravity of the situation. We're in space.
RE: Is this is a good thing?
Zuber @ 3/6/2003 2:35:23 AM #
It's not that Sony don't license their ideas that bugs me. They are willing to do so in some areas.

My problem is that they insist on inventing their own standard (and often reinventing the wheel) rather than just using perfectly good current standards allowing interoperability. Memory Stick,Memory Stick Duo, Wi Fi slot being exellent examples.

They would probably continue with the same agenda if they owned PalmSource.

Zuber

RE: Is this is a good thing?
anjrober1 @ 3/6/2003 10:38:30 AM #
While I agree that HandEra first implemented high res, VFS, virtual graffiti, etc. Sony was the first to really make it work. I had a 330 from the first day it was interoduced and it was by far the flakest Palm device I have ever had (which is nearly all of them). I exchanged it a few times with HandEra and they were all flakey. We recommended them to a customer who ended up ditching them. They ARE flakey devices, period. It was the only Palm device that I ever lost data using.

In contrast my Sony devices have been some of the most stable devices I have ever had. My NX70V takes a licking. Apps work well. When I install odd ball apps, it doesn't lock up. Sony makes rock solid devices.

It doesn't necessarily matter who invented a feature, it's who is able to market and deliver the total solution. Thing PARC here, they invented everything and delivered nothing. I give HandEra credit for some great work, but they are not going to lead the Palm community. Sony could.

As for their developers community, they need to get to work. Getting information out of them is nearly impossible. Our local Sony rep barely returns my call.


RE: No.
mikemusick @ 3/6/2003 12:15:54 PM #
>Sony makes good products, but their developer program is absolutely terrible.

Bingo. When it comes to support in all flavors, Sony consistently gets an "F". They build fabulous hardware, but there is a corporate arrogance on par with Microsoft, "If we don't already provide it, you don't need it, so how dare you ask for it. Next."

RE: Is this is a good thing?
JKingGrim @ 3/6/2003 2:36:50 PM #
Also, Palm Source maintains tradition. Palm OS 5 has extrodinary new features, but looks just like Palm OS 1. Sony has a 'go against the grain' attitude that I don't like.

RE: Is this is a good thing?
fleegle @ 3/6/2003 3:10:09 PM #
Response to comment from anjrober1:

I've owned the HandEra 330 since they first came out. I haven't had any "flakiness" problems and have never lost data. Maybe I am lucky.

However, I have friends that have been having problems with their Clies. Mainly, the problem where it looses contact with the Memory Sticks. I know others that access this website have had this problem. This I call "flakey". The workaround is to shove a folded piece of paper in the slot along with the Memory Stick. What a joke! Above all that, Sony doesn't even acknowledge/recognize that there is a problem.

Yes, you may have had some flakey H330s. And I know there are some out there. But all the PDAs out there: Clie, Palm, PPC, etc. are far from "perfect" and have their own problems whether or not you want to recognize them as a problem.

RE: Is this is a good thing?
HiWire @ 3/6/2003 8:41:31 PM #
I just checked out the new SJ33 Clie at The Sony Store tonight... those buttons are just ridiculous. Nice screen and built-in cover though. The cover idea should be copied by more manufacturers; it saves the consumers money that they would waste on a case. They should make sure that the cover can be replaced, though, in case of accident.

Palm m505 User
RE: Is this is a good thing?
Fat_Man @ 3/6/2003 8:50:26 PM #
HandEra this and HandERa that...blah, blah, blah

What ever happened to HandEra anyway? If they are so revolutionary, then why have they not release a new handheld since the 330?

Weren't they working on a color handheld?



KAY

RE: Is this is a good thing?
Fat_Man @ 3/6/2003 9:19:27 PM #
Oh yeah, speaking of HandEra's innovations:

While HandEra may be the first to introduce these, they are all dead-ended.

1. High resolution: only HandEra uses they whacky 360x240 resolution scheme. As you might have noticed, the new palm OS standard is 320x320. Dead-end.

2. External Cards: The auto-card (or whatever) they use is not in the new palm OS, instead it is the VFS developed by Sony. Dead-End.

3. Virtual Graffti: Sony's virtual graffti is skinable and much more developed than HandEra's, if palm is to go with a VG scheme...which do you think they will pick? Dead-End.

If you want to talk about important contributions to the Palm OS and hardware, the contributions have to be carried over to future models, and so far I don't see ANYTHING HandEra has done that showed up in any of the later palm OS models, well maybe that replaceable battery.

The HandEra 330 is a Dead-End device, maybe that's why they have not released an updated model. They would have to drop most of their OS modifications to adopt to Palm OS 5.

KAY

RE: Is this is a good thing?
fleegle @ 3/7/2003 9:46:33 AM #
Fat_Man,

Where do you get your information about the HandEra 330?

You can skin the virtual graffiti area. You can even modify the virtual graffiti area to display the time, date, free memory, etc. on the icon bar when it is minimized. I don't know if it can be done on the Clie, but it is very customizable.

As far as not seeing "ANYTHING HandEra has done that showed up in any of the later Palm OS models"... now what is that other slot on the Clie NX series?!? A concept that HandEra innovated. So... what does Sony decide to do with it? Make it only compatible with their WiFi card. Why did they do it? To force people to use their Memory Stick rather than have a choice of which media to use. Is this really a good thing?

RE: Is this is a good thing?
cbowers @ 3/7/2003 5:14:01 PM #
KAY, shhhhh. You're wearing your ignorance on your sleeve (on all points).

THIS WAS EXPECTED

navomaal @ 3/5/2003 3:34:27 PM #
IT was going to come down to this anyway - give how palm has been doing business...so good...however this might not be a good idea for the users - without competetion - there will be no need to come out with new producs.


pot calling kettle black

ganoe @ 3/5/2003 3:31:28 PM #
"there are monopoly companies like DoCoMo. [...] This is very scary because they want to control every layer of the business."

and then

"My problem now is that as Palm licensee we have to pay them lots of money. [ interviewer asks if he would like to buy Palm's software business ] Yes, if they want to sell."

So you could control every layer of the business. Wow, wouldn't that be "scary"!

Well, at least he was honest.

RE: pot calling kettle black
mashoutposse @ 3/5/2003 3:39:50 PM #
I thought he was talking about the DoCoMo being a 'scary' situation as a competitor, not as some odd ethics or moral issue like you're hinting.

RE: pot calling kettle black
Tungsten @ 3/5/2003 7:34:50 PM #
>So you could control every layer of the business. Wow, >wouldn't that be "scary"!

Now, don't you get ahead of yourself. Sony controls every layer of WHAT business?

PDA's? No - there's still Palm, HP, Dell, Toshiba, and the smaller players. Note that there are only two companies left making *mainstream* PalmOS PDAs: Palm and Sony (Treo & the Garmin iQue don't count as they are niche products).

Digital cameras? Canon, Kodak, Nikon, Olympus to name a few.

Game consoles? obviously not.

Sony does not control every layer of the PDA business. They do have a thing for competing in every consumer electronics category possible, and having their products interoperate with each other. Sony is not who I'd call anti-competitive.


RE: pot calling kettle black
ganoe @ 3/7/2003 7:40:49 PM #
If Sony owned PalmSource, they would own essentially every layer of the PDA business. They would own the primary OS being used, a major portion of the hardware used in production, and one of the major brands to end users. Plus, owning the OS would allow them to influence what hardware is used, forcing companies to buy Sony parts.
RE: pot calling kettle black
JKingGrim @ 3/8/2003 8:29:03 AM #
Memory Stick! NOOOOOOOOOOO!

Might be the best thing.

Stann @ 3/5/2003 3:33:15 PM #
I know quite a few will disagree with me, however a merger with Sony might be the best thing that could happen to Palm/PalmSource.

Maybe then there might be some true innovation, and more frequent OS updates. So far what I see from OS5 unless I'm going wireless I see no need to upgrade.

Let's not kid ourselves, all the bells and whistles that PPC's have is attractive to a lot of people. Palm has been slow to adopt these innovations, and is in some respect stagnet.

Don't read into the statement, I'm no fan of PPC's but some of the features are attractive and wish they were available in Palm.

RE: Might be the best thing.
JKingGrim @ 3/5/2003 3:45:27 PM #
>>Maybe then there might be some true innovation, and more frequent OS updates. So far what I see from OS5 unless I'm going wireless I see no need to upgrade.<<

Maybe there would be more frequent updates, but SONY would not give them to the users.

RE: Might be the best thing.
cbowers @ 3/5/2003 6:38:34 PM #
You couldn't be any more wrong Stann.

RE: Sony vs. M$
Cheetah @ 3/5/2003 10:47:05 PM #
In the end, if Palm does not sell out, they will disappear. How many competitors of Micro$oft have survived for very long against a full frontal assault from M$?

Sony has the resources, brand name and marketing to go head to head with Micro$oft.

PalmSource does not.

Can SONY do it?

JKingGrim @ 3/5/2003 3:42:19 PM #
Does Sony have the cash? Even if they do, it is ultimately PalmSource's choice. Isn't it? [shifts in his seat]

RE: Can SONY do it?
dickius @ 3/5/2003 4:05:59 PM #
Sony has plenty of cash. They could also pay in stock. Technically, it's not PalmSource's choice; it's PalmSource's SHAREHOLDERS' choice. Palm stock is currently trading around $10. If Sony came in with an offer of, say, $16, the shareholders might very well accept the offer. Sony would own the whole company (including hardware), for less than half a billion. Sounds like a bargain.
RE: Can SONY do it?
hotpaw4 @ 3/5/2003 4:30:32 PM #
Why would anyone with the cash TALK about buying a company and risk running the price up, instead of just quickly buying a controlling interest before anyone notices? Perhaps they have a reason to talk the price up (to keep some other potential suitor at bay)?
RE: Can SONY do it?
dickius @ 3/5/2003 4:51:11 PM #
You can't just buy a controlling interest in a company without anyone noticing. Under US law, you have to make a public filing with the SEC if you acquire more than 5% of a publicly traded company. Also, if you want to buy more than $50 million worth of a company's shares, you have to make a premerger filing with the Department of Justice and the FTC, and wait a minimum of 30 days before acquiring the shares.

Does anyone know if Palm is incorporated in Delaware? If so, once the company is "in play" (i.e., someone wants to buy it), the company's board of directors is obligated to hold an auction to find the buyer willing to pay the highest price. Sony can't just sneak in and buy the company for a song.

RE: Can SONY do it?
kidA @ 3/5/2003 10:45:05 PM #
i don't know if they're incorporated in Delaware, but i would imagine that they probably are since a good portion of corporations are incorporated there because of their laws and stuff.

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