Crazy Rumour Department: Dell Looking to Buy palmOne?

[Jason Dunn]

<div class='os_post_top_link'><a href='http://www.palminfocenter.com/view_story.asp?ID=6790' target='_blank'>http://www.palminfocenter.com/view_...ory.asp?ID=6790</a><br /><br /></div>"Rumors floating around wall street that Dell is interested in a takeover of palmOne sent stock shares of palmOne higher in trading yesterday. <br /><br /><i>The uncorroborated rumor was posted in a note on the stock site Briefing.com. It stated, Dell (DELL $35.78 +1.3%) rose after Banc of America raised its rating to Buy from Neutral. DELL has started offering companies a zero interest lease for PCs. There were rumors floating around of a possible Dell takeover of PalmOne (PLMO $18.21 +12.5%), which is certainly feasible and a deal would create synergies for both companies.</i><br /><br />Shares of palmOne were up 12% in trading Wednesday based on the news."<br /><br />Nah. :roll: I just can't see this happening in any way - it's not Dell's style. What do you think?

[Foo Fighter]

It's true! It's all true! I know because Micheal Dell told me so. We play golf together every weekend. He throws some bitchin keggers. :drinking:

[drop]

PalmOne up 12% based on that news? Wow, a vote of confidence on PalmOne's management. :lol:

Dell doesn't seem to be so hot on their PDA development despite the success of X5. No, I'm with you Jason, don't see Dell doing such a thing.

[Steven Cedrone]

Couldn't see it happening, unless they were doing it to force Microsoft to make concessions somewhere (but I still couldn't see them doing this with PDA's).

Now, if there were a rumour about them buying Red Hat... :wink: :twisted:

Steve

[huangzhinong]

well, if Dell buy Palmone, I can see Palmone make a PPC finally and much earlier than we expected.

[Jason Dunn]

well, if Dell buy Palmone, I can see Palmone make a PPC finally and much earlier than we expected.

Heh. Just wait another 14 minutes. :-)

[Kacey Green]

well, if Dell buy Palmone, I can see Palmone make a PPC finally and much earlier than we expected.

Heh. Just wait another 14 minutes. :-)

I thought you were talking about the stock market, but had the nagging feeling that a news post was in the works

[BugDude10]

... but I've also heard that Bill Gates will send me a check for $236 for each person to whom I forward a special test e-mail from Microsoft and AOL... :roll:

[manywhere]

:rofl:

Thanks Jason for publishing the funny "joke"/news! ;)

[Felix Torres]

PalmOne designs and manufactures PDAs; Dell farms out those processes by defining product specs and letting low-cost asian manufacturers bid for and subcontract that work. Its how they keep their overhead low and profit margins acceptable.

Buying PalmOne would be bringing those functions (and the attendant overhead and liability) in-house.

Why would DELL want to own PalmOne, then?
You don't buy the cow to get a glass of milk. ;-)

Realistically, this only makes sense if your brand isn't good enough to sell the product (PDAs) on its own.
And Dell has no branding problems that require buying a whole company just for the brand.
Bottom line?

No go.

[Foo Fighter]

This just doesn't make much strategic sense for Dell, IMO. If Dell really intended to embed themselves into the mobile market, they'd go after RIM or Good first. I can't believe they would buy an entire company just for rights to one product (Treo 600).

[ctitanic]

Lion + Tiger = Liger

Palm + Windows CE = PACE

:twisted:

[Zack Mahdavi]

I don't think this will happen at all. I mean, if Dell really wanted to enter the Palm OS market, why can't they just make their own Palm OS PDAs?

I know PalmOne could technically make Pocket PCs if they wanted to, but wouldn't that be a waste of money for Dell since they already make their own Pocket PCs?

The whole thing just doesn't seem right to me.. I don't think Dell will go through with it.

[Pat Logsdon]

I know PalmOne could technically make Pocket PCs if they wanted to, but wouldn't that be a waste of money for Dell since they already make their own Pocket PCs?
Actually, they don't - Wistron makes the Axim line. IF Dell is serious about selling their own Palm line and IF they project doing so over a prolonged period of time, it MIGHT make sense for Dell to purchase PalmOne to avoid paying licensing fees over that period of time. There's also the fact that they could collect licensing fees from other companies that sell Palms at the same time.

That said, I don't think it'll happen, either. :D

[Felix Torres]

I know PalmOne could technically make Pocket PCs if they wanted to, but wouldn't that be a waste of money for Dell since they already make their own Pocket PCs?
Actually, they don't - Wistron makes the Axim line. IF Dell is serious about selling their own Palm line and IF they project doing so over a prolonged period of time, it MIGHT make sense for Dell to purchase PalmOne to avoid paying licensing fees over that period of time. There's also the fact that they could collect licensing fees from other companies that sell Palms at the same time.

That said, I don't think it'll happen, either. :D

Uh, PalmOne pays PalmSource licensing fees for PalmOS.
If rumor can be trusted, they actually pay a higher rate than SONY...

[Pat Logsdon]

Uh, PalmOne pays PalmSource licensing fees for PalmOS.
If rumor can be trusted, they actually pay a higher rate than SONY...
You are absolutely right. Sigh - that's what I get for reading too fast and trying to squeeze in a few posts in a five minute break. :roll: I'm not usually an idiot, I promise. :mrgreen:

I stand my my last assertion, however: I still don't think this fits with Dell's m.o. I think it's far more likely that they'd find more profit by squeezing their hardware suppliers a little harder. :wink:

[twalk]

This can actually make a lot of sense.

Dell has been stuck at 6-7% of the market for a lonnng time. When you compare the price of the X3's to the competition (ie, HP), it doesn't look like they are even competiting price-wise anymore. So Dell is faced with 3 choices: go fully head-to-head against HP (which hasn't worked for them so far), keep the status quo (which must be eating at them badly), or do something to really shake up the market. They also would like to get into the smartphone market, but don't really know how.

What would they get? A combined PPC + PalmOS PDA marketshare of 50%+, the best selling smartphone in the US last quarter, top PDA designers, retail channel access, and connections to most of the wireless carriers (which is tough to get). Just add a few Dell execs to fix up PalmOne's cost containment and supply chain.

Don't forget that smartphones are expected to become a 250M+ unit/year market that Dell would like to get into. That's enough incentive alone for them to consider ticking off MS.

[hotweiss]

This could be possible. Dell could use Palm to surpass HP in another sector...

[Felix Torres]

Hmm, something odd here...

Do PALM fans *want* DELL to take over PALMONE?
Its not *going* to happen, and it makes no sense; so it sounds odd that you folks seem to *want* it... :-o

[twalk]

Palm fans are terrified of Dell buying PalmOne. They think that it may be an end-round for MS to destroy Palm. Dell would need to make some really strong commitments to both get the sale, and get this past the DOJ. (Originally Dell approached Palm for a PalmOS license, but went to MS after Palm refused (One/Source hadn't split yet), so obviously Dell doesn't have anything against Palm.)

OTOH, most Palm fans know that PalmOne has supply chain/corporate access problems, and that having a major manufactuer involved with PalmOS would be a really good thing for them.

The really wild rumor going around: HP is talking with PalmSource about making a treo600 clone.