Comments on: Palm's Sales Drop in April

I have a prediction on when sales will increase. When you learn how to meet pre-orders and you can get your new product to market and not piss off the loyal Palm followers.

I believe that the focus has changed. People are more concerned about performing in their job and less focused on what tools can enhance that job. When things get tough, you go back to the basics. I have been using the Palm for years and yet am still learning how to make my job easier with this device. I think that neither I or my Palm have achieved the optimum path. One has to develop new habits. That takes time. You don't change a paradigm overnite.Your employer wants you to use new technology to become more productive, BUT does not want you to spend the time to LEARN how.

Actually... Retail sales make up the majority of sales of Palm handhelds and several years ago the retail channels basically said "you will get us units before you sell them or give them to online stores, or we will stop selling your products".

Not wanting to lose that (the MAJORITY) market, Palm has since shipped FIRST to retail channels and 2ND to online stores and filled their own web orders.

This isn't a recent change. This is the third (or maybe fourth) year that if you want a unit fast you avoid buying one direct from Palm via their store.

This is such a common occurence, there's even a Dilbert cartoon about it.
It should be a mystery to NOBODY why sales were slow in April. And I'll bet I can predict when
sales will improve: May! The PalmPilot mailing list is buzzing with folks who have been
rushing out to Office Depot to get their m505. These are most likely the "early adopters" who
will be the guinea pigs for the rest of us. If the screen turns out to be acceptible, sales will
skyrocket. Of course, the way Palm has been doing things recently, they will be caught off
guard and will build a huge backorder for these things. They'll be elated at the sales rebound,
but will lose stock value because they will report "parts shortages" because they didn't think
far enough ahead to build enough, and now they can't get parts fast enough to build more.

Just a guess here, but I'll wouldn't be surprised if this actually happened.

Please don't feed the trolls.

Palm won't go down because of the Palm OS. They'll either sell themselves to Sony, wo will carry the ball and bury that dumbass Bill Gates forever in the PDA market, or they'll be the next Sega, after they give up on making hardware beacuse of their inability to produce a competitiive product on time.

The reports I've seen in the last few days are a testament to this. The m500 and m505 are average at best. I'm tired of people convincing themselves that these PDAs are great simply because they're made by Palm.

The Palm OS is a great thing because it's shared with so many developers. Palm would rather have 10% of a $1000 pie over 100% of nothing.

Keep up the good programming, Palm. It's the only thing you've got going for you in this market.

Pocket PC will never crush the Palm platform, because it lacks a critical advantage of PalmOS devices...sex appeal! Devices from Palm/Handspring/SONY are not just business tools, they are fashion statements. Sleek, elegant, stylish, and finely designed. They are made for easy wearability. PocketPC, on the other hand, while filled with impressive features, lacks the qualities that have made the name "PalmPilot" a household name.

Contrary to the post quoted below, PocketPC is very much alive and well, and is going to be expanding market share at Palm's expense.

Palm has made a series of unbelievable blunders over the past two years, and in particular over the past 4 months. They are using relatively primitive equipment that has not been significantly updated in 4 years. The Sony CLIE N710C is the only new PalmOS PDA worth buying, and may end up being what saves Palm from extinction.

Palm makes about 5% of its revenues from OS licensing, so people who suggest they can afford to get out of the hardware business don't nnow what they are talking about. Going through their models, we have:

m100 - entry level, low markup, minimal profit but high sales.

m105 - modest markup, good sales.

IIIc - lower markup (prices recently slashed in an attempt to clear out remaining inventory before m505 release), poor sales.

Vx - high markup, good sales but sales decreased after m50x announcements and now will be discontinued, leaving millions of dollars lost in unsold inventory.

VIIx - high markup, low sales, needed to keep a preliminary wireless strategy going. Will be abandoned in 2 months when m700 series released, using a different wireless strategy.

m500 - high markup, low sales predicted by industry experts.

m505 - high markup, high sale had been predicted, however this is now in question due to Palm's miscalculations regarding relative importance of screen contrast/brightness vs. battery life. (Most customers would have chosen a nicer screen at the expense of battery life, but Palm marketers seemed to be very concerned that their PDAs were becoming more similar to PocketPCs in terms of battery life.)

Palm is losing millions daily and recently cancelled plans for an extravagant new headquarters (what were they thinking?). Silicon Valley is slumping and a lot of naysayers have made self-fulfilling prophecies about sales, which have (overnight) slaughtered Palm's stock price. (Makes you wonder if Gates pays these "analysts" that have been slamming Palm...)

Now factor into this the price war that is about to be waged among manufacturers, and you'll see Palm, Inc. isn't in a very good position. The fact that they have survived despite years of mismanagement is a testament to the brilliance of the original design and the elegance of the Palm OS.

Microsoft is the most powerful company in the world and could have easily bought Palm with the money Gates has in his "petty cash" jar. What's surprising is that they haven't yet started flooding the market with
inexpensive (subsidized) PocketPCs to gain market share. In any event, with the release of the new PocketPC4, they might start showing Palm how aggressive Microsoft can be when they decide to play hardball. Palm is wounded and hemorrhaging cash profusely. It would be very unlike Microsoft to not
seize this opportunity to move in for the kill.

I have read rumors that either Sony or Microsoft will be buying Palm this year. The way things are going for Palm, they may soon be of no concern to Microsoft.

_______________________________________________________
Original post:

Why does everyone automatically assume PocketPC will be around forever? Microsoft has been pouring money into the platform for at least 5 years now and I strongly doubt they've made any money on it yet.

Palm advertises it has some something like 10 million units. Microsoft has about 10% of the market and they make about $10 per unit in licence fees. So MS has about $10 million in revenue in about 5 years. I wish I knew how much money they'd spent developing and advertising CE/PPC over the years but I'd bet you dollars to donuts that it was way, way over $10 million.

Microsoft has a lot of money but they can't afford to fund every struggling product forever. Remember Microsoft Bob? They will kill failing products.

Sometimes it doesn't matter how good the product is. If it isn't successful in the marketplace, it dies.

-RobZombie