HP buys Palm

Palm has been saved. Today, HP said it will buy the struggling handset maker for $US1.2 billion.

Shares in Palm (NAS: PALM), which is 30% owned by Elevation Partners - aka the venture cap fund backed by Bono out of U2 - surged 27% in after-hours trading as news of the deal broke (a pop that actually took Palm's stock beyond HP's buy price, which represented a 23% premium. Some investors are obviously expecting a higher offer. Or are just not too bright).

HP shares (NAS: HPQ) fell.

I've always had a soft spot for smart phone pioneer Palm and its keep-it-simple approach (everybody says that, Palm has actually done it, mostly).

With its Palm Pilot, Palm invented the PDA (personal digital assistant). And with its Treo (originally developed by breakaway faction Handspring), it invented the smartphone - a category now dominated, of course, by iPhone.

The Treo ran on Palm's own Palm OS. A switch to Microsoft Windows coincided with the rise of competitors such as the iPhone and Nokia's N and E series, the rise and rise of RIM's BlackBerry line and, most recently, the emergence of Google Android phones.

With the Palm Pre, the company returned to running its hardware on its own, simplified operating system software, the well-regarded WebOS.

Ironically, the Pre, which gained five-star reviews in the US, has not been available in New Zealand because it runs on CDMA (the mobile network Telecom is in the process of phasing out).

And for all it's initial buzz, the Pre, and other new models, have not been enough to turn the company around.

Still, WebOS has caught Palm's eye. And with HP behind it, Palm should rise again. For any consumer who likes a little competition, that's a good thing.

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Almost like Yahoo vs Google, the newer more simpler (looking) kid won.

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They lost their way when Windows CE (WINCE) was a pup. Palm is a prime example of what not to do when faced with competition: do not pratt about navel gazing for several months.

Once they'd finished angsting about their future direction, Microsoft had eaten their lunch. Then they sold themselves to 3M which had NO idea, then they split in two, then they stopped using their own software, then they bought the company their founder had left to set up, then they stopped making robust products, then they lost market share and really began to panic.

Today, nobody has a Palm device and nobody cares about Palm whatsoever. The days of the Pilot are long gone, the company has no teeth and no promise and no cache with users. The market is now all about Google versus Apple and even RIM and Microsoft are wondering WTF happened.

Palm is toast.

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Having had to support a Palm or 3 over the past couple of years, their phones were inevitably dire to look after, especially if the owner wanted some of that "internet mobile email" stuff they'd read about in the latest edition of NBR. Compared to the iPhone, a Blackberry or (even) a Sony-Ericsson, the onboard software was primative and difficult to use and to configure.

Personally, I'll say "good riddance" and hope that Palm disappear, unwanted and unmissed like OS2.

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Palm was absolutely brilliant. When others were faffing about pretendiong to be mini computers (remember the Psion, the then-leader), Palm just did what it did really well; contacts, calendar, and a few other things. Then they lost their way. I remember chatting with a Palm exec in the US after they went with Windows. He didn't get that going from simple that worked brilliantly to complex that was full of problems for users wasn't really that smart, and even me (a strong supporter) left them becuse I actually still wanted something that worked (funny that) . Now, the iphone does that well. Turn it on, a few simple configuration things that even I can do right out of the box and it just works. The iphone really is the new Palm. apple understood it before Palm itself. Goodbye Palm.

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As a user of a Palm Treo and a buyer of the Palm Pro (XT network), I hope that HP (who I also prefer in the PC market) do a good job. I've used, and loved, my Treo for years and it's been great as a phone and PDA. Never used email on it. The touchscreen is great. "upgraded" to a Palm Pro on XT. Uses Win Mobile. Phone is good, Win Mobile is rubbish, and XT failed, so back on Palm Treo on CDMA. Will probably go to another network as I can, apparently, use the new phone on GSM.

And if Palm/HP make a new phone available in NZ running webOS I'll be in line for it. iPhone is good but it has issues and is expensive. I'm not convinced about Apple and it's hype.

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