Palm, Inc. To Be Sold?

[Ed Hansberry]

<a href="http://today.reuters.com/business/newsarticle.aspx?type=ousiv&amp;storyID=2006-02-02T094343Z_01_N02354666_RTRIDST_0_BUSINESSPRO-PALM-DC.XML">http://today.reuters.com/business/newsarticle.aspx?type=ousiv&amp;storyID=2006-02-02T094343Z_01_N02354666_RTRIDST_0_BUSINESSPRO-PALM-DC.XML</a><br /><br /><i>"A top shareholder of Palm Inc., which makes hand-held electronic devices, has sent a letter to the company's board urging them to explore a sale of the company, the Wall Street Journal reported on Thursday."</i><br /><br /><img src="http://www.pocketpcthoughts.com/images/hansberry/2006/20060202-palmgobbledup.gif" /><br /><b><i>Will Palm, Inc. be gobbled up?</i></b><br /><br />Palm Inc. is really the only company left that is dedicated to making handhelds for consumers. Several years ago, you had Handspring, Handera, Palm and even URThere with its Pocket PC offering, the @Migo, but those have all either fallen by the wayside, been acquired or got out of the handheld manufacturing business entirely, except for Palm, Inc. Will it be absorbed into a larger company? It wouldn't be new territory for Palm. It was a part of US Robotics and then 3Com before its IPO in 2000.

[inteller]

buyer #1, Microsoft.

[whydidnt]

I doubt MS would be interested. It would put them in the postition of competing with the OEM's that sell products with their OS on it.

Palm is the type of company that should do well independent of a bigger corporation. As a smaller company without a huge infrastruction to feed they should be much more nimble and be able to innovate more quickly.

However, we really haven't see that from Palm to this point, even after the spin-off from 3Com. They definitely appear to be a short-term profit driven company, like many larger corps and don't seem to be very good an innovating. Perhaps an acquistion by a larger corporation with deeper pockets would provide enough cash to allow them to look beyond 1 or 2 product cycles when developing new devices. Their current strategy is obviously one of getting 2-3 "new" devices out of one design by crippling and then providing incremental upgrades. Not an awful strategy for the short term, but as the market share numbers show, not so good long term.

If anyone were to acquire them I suspect it would be someone like BenQ or the like who have had issues getting phones placed with US carriers and would be buying that asset as much as anything else -- ironic, since that was a driving force behind Palm's acquistion of Handspring.

[Patrick Y.]

All I can think about are the yummy fish fillets!!! :mrgreen: :devilboy: