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  1.    #1  
    I just listened to Palm SVP & CFO Andy Brown's presentation at the 2007 Merrill Lynch Communications Forum. Here are a few of what I think are the key things he said, with any emphasis in bold added by me:

    On Jeff Hawkins and Palm's Vision

    He started both sessions and the Bank Of America conference on 2/21/07 with a similar comment:

    When you really think about Palm as a company, when Jeff Hawkins started the company and invented the first Palm Pilot, he had a vision for the company that I think is really playing itself out in the marketplace today, and that is the future of personal computing is mobile computing, and that's really what you have in devices like this [the Treo] that are basically mobile computers in your hand, and that is what we're executing to in the marketplace.
    Despite Jeff Hawkins concentrating on his "brain work", as a key founder a visionary, his vision and influence still matters greatly at Palm. I think this is very important to remember, and I'll expand on this further down*.

    On "Transitioning to Windows Software"

    Question: As you transition towards Microsoft Operating systems, you've got two [Windows Mobile products] now, what's unclear to me is that if everyone is licensing the Microsoft operating system, what is the competitive advantage at that point?

    Andy Brown: I want to make sure we understand something, we're not transitioning to a Microsoft operating system.
    He then went on to give 3 main reason why Palm became a Windows Mobile licensee when asked if Palm was migrating to Windows software:

    1. Hedge their bets when the future of "Palm OS" was in question.
    2. They wanted to expand into Europe and the European carriers told them they didn't want to adopt another platform other than Symbian and WinMob.
    3. Palm wanted to expand into the enterprise market, and no CIO has ever been fired for buying Windows.

    They've addressed problem #1 with their acquisition of perpetual rights to use, modify and innovate on top of Garnet OS code, as well as the rights to the Palm OS name. They're using Windows Mobile mainly for markets (Europe and the enterprise) where they can gain marketshare, but they view Palm OS as their 1st platform, and Windows Mobile as their 2nd platform.

    On Palm OS

    If you think about the Palm OS, being uniquely positioned in the Palm OS, because it's really more of a consumer oriented operating system [unintelligible] there's nobody else out there that has that, versus focusing strictly on that end to end enterprise solution I think that's not going to be the high growth part of the market....
    There's still a significant amount of people that we can tap into... Which is why the Palm OS I think is not just going to survive, it's going to thrive. I mean the carriers really look at us and that Palm OS as pretty formidable. They have a lot of users asking for it.
    On purchasing perpetual source code rights and rights to innovate on top of Garnet from ACCESS

    What we really wanted out of the Palm OS, you know the acquisition of the license, was the ability to get those innovations out sooner. We weren't seeing that from PalmSource, let's just face it, they weren't executing, and it was causing us more pain than it was them. We were paying them 2.5% for every unit that shipped, and yet they're not doing anything. What we like to say that if you look at the UI on the Palm operating system, it's still a great UI. It works seamlessly, it's a great house, but the foundation's a little bit rocky, and what we're going to do initially is shore up that foundation, is really the key.
    It gives us the ability to be more predictable about the innovations that come out of Palm OS products.
    We purchased a perpetual license to the source code, which allows us to basically do any innovations that we want on top of that. And what that allows us to do is control our own destiny...

    One of the reasons that we went down the Windows Mobile route 3 years ago... [was] the Palm OS at that point was tossed off as a separate company, and we were concerned about that. We were to some extent hedging our bets.
    It does allow us to control our own destiny so that we can now specifically customize that operating system for our products and our products only.
    Similar comments from the From Bank of America conference on 2/21/07:

    Strategically, it's important. We haven't gotten into the details, but I think the ability to control our own destiny on that platform is strategically important, so we can customize specifically for Palm and Palm Treos, that user experience on that platform.
    When asked about Palm employees and keeping them at Palm and excited:

    One of the fun things about being at this company is just the passion that we have behind mobile computing. We've got people at the company that are just excited about this space, that have been with Palm originally.... One of the reasons why were were able to get the Palm OS, and we're confident that we can innovate on that, is that still a lot of the people that have done those innovations are at Palm today.... There's a strong passion behind this [Palm] business, and we've got a lot of long-tenured Palm employees on some of the more HandSpring-Palm, you know combination, that are passionate about this space.
    Palm clearly sees the Palm OS as the most consumer-oriented and friendly (easy to use) mobile operating system.

    *From Jeff Hawkins's Oral History (page 34, warning-PDF Link):

    I really dislike Windows software. I really think it’s a disservice in many ways; the way the industry’s turned out is unfortunate. And there’s a theme in my life, by the way, which I really want to correct this. I want to correct- underlying a lot of this, besides the brain work, another theme (maybe this is one of the questions we get to at the end here) is really how do you make personal computers that are better and useful for a larger audience.

    Conclusions

    Clearly, Palm and Jeff Hawkins view Windows software as not easy to use, and Palm wants to make mobile computers that are easy to use for a larger audience (consumers), which they see as a high growth area, unlike the enterprise market. Global handset sales numbers back this up.

    Palm licensed Windows Mobile to hedge their bets when the future of the Palm OS was in question, and to gain marketshare in the enterprise and European markets, but it is not their first choice as an mobile operating system for a larger audience.

    Palm views their key differentiator as their ability to offer a user experience that "delights the user" (usability) through the Palm OS, and now that they have acquired the perpetual rights to innovate the Palm OS in a way that is exclusive to their products, as well as the name Palm OS, they can control their own destiny. Therefore, Palm sees the Palm OS as being tied to their destiny. They are not putting it in the hands of ACCESS, Microsoft, or anyone else for that matter.

    Brian
  2. #2  
    that's a nice write up, but i wonder how far along palm really is with their Palm 2.0 platform. They would need to shock everyone with a spring/fall release to still fight in today's market. I'm cheering them on though! Go Palm Go!

    Timmay
    Iím a lucky man to count on both hands
    The ones I love..

    Visor Pro -> Visor Edge -> Treo 180 -> Treo 270 -> Treo 600 -> Treo 650 -> T|T2+SE T68i -> Treo 600 -> T-Mobile MDA -> Treo 755p -> Treo 800w -> Treo 755p -> PALM PRE -> Palm Pre 2 -> HP Palm Pre 3

    Twittering about
  3. #3  
    Here's a quote from a CNET article written last year about Apple Computing. Some people may not remember their demise in the early 90's. Reminds me of Palm right now. I am pulling for Palm and think they will come back strong.

    Given the company's current success, it's easy to forget how it fell from the top of the tech heap in the 1990s and scuffled along as Microsoft grew into the largest software company in the world and PC makers such as Compaq Computer and IBM came to dominate the industry Jobs and Wozniak helped create.

    But glossing over those years would make it difficult to describe just how remarkable Apple's current renaissance is. While Compaq now only exists as a brand name sold by Hewlett-Packard, and IBM no longer makes PCs, Apple is enjoying perhaps its finest hour. The iPod is a pop-culture phenomenon. And, incredible to some, Apple is having an easier time updating its flagship Macintosh operating system than Microsoft is having with Windows.

    Some say there are no second acts in business, but Jobs & Co. are making mincemeat of that old chestnut.
  4. #4  
    Simple question - how many people think Palm will ever stop selling WM devices? And how many people think Palm may in the future stop selling PalmOS devices?

    For people who know Palm's history I think the second group is much bigger than the first group.

    Surur
  5. #5  
    My big question has been, when will they put out a flip and/or candy bar phone? Or is this out of the question for them?

    How long do they expect to keep selling full size PDA phones alone? If BB can put out a Pearl to gain mass attention, what's stopping Palm? Their stubborness to stay forever with the same form factor alone?
    HP has officially ruined it's own platform and kicked webOS loyalists and early TouchPad adopters to the curb. You think after you drop it like a hot potato and mention it made no money and is costing you money, anyone else wants it??? Way to go HP!!

    And some people are fools to keep believing their hype. HP has shown they will throw webOS under the bus and people are still having faith in them??? News flash: if it's own company won't stand behind it, it's finished!
  6. #6  
    Quote Originally Posted by The Phone Diva View Post
    My big question has been, when will they put out a flip and/or candy bar phone? Or is this out of the question for them?

    How long do they expect to keep selling full size PDA phones alone? If BB can put out a Pearl to gain mass attention, what's stopping Palm? Their stubborness to stay forever with the same form factor alone?
    Nah, I definately see Palm coming with a slimmer, more fashionable form soon. I personally really like the shape and form of my current Treo...but I sure wouldn't mind if it were a little sexier and slimmer either. What I see as a major hurdle though is maintaining some standard of battery life with an even slimmer, sleeker form...and the resulting slimmer, smaller battery. Fact is...even though I am seeing improving battery life now, with several full charges under my belt, than when I started...realistically, the battery life as it is right now isn't the greatest. I'm concerned that it might actually get worse and not better.

    I am glad to hear that Palm isn't planning on jumping onboard the Windows train any time soon, and leaving the Palm OS behind. I agree that Windows is needed to maximize the user popularity with the brand...I just hope that they will be stubborn enough not to be swayed by Microsoft into giving up what they have fought for...and so many users have stayed with Palm for.
  7.    #7  
    Quote Originally Posted by surur View Post
    Simple question - how many people think Palm will ever stop selling WM devices? And how many people think Palm may in the future stop selling PalmOS devices?

    For people who know Palm's history I think the second group is much bigger than the first group.

    Surur
    Why don't you take a poll and find out? I consider myself someone who knows Palm's history pretty well, and I think you're absolutely wrong. I guess you didn't read Andy Brown's statements. The message is pretty clear that Palm feels Palm OS is not only going to survive, but thrive, and Palm's destiny is tied to the Palm (their own) OS.
    Last edited by ballistic; 03/02/2007 at 08:37 PM.
  8. #8  
    Quote Originally Posted by surur View Post
    Simple question - how many people think Palm will ever stop selling WM devices? And how many people think Palm may in the future stop selling PalmOS devices?

    For people who know Palm's history I think the second group is much bigger than the first group.

    Surur
    Why would Palm shut down a profitable and growing business line that comprises most of its business?
  9. #9  
    Quote Originally Posted by ballistic View Post
    Why don't you take a poll and find out? I consider myself someone who knows Palm's history pretty well, and I think you're absolutely wrong. I guess you didn't read Andy Brown's statements. The message is pretty clear that Palm feels Palm OS is not only going to survive, but thrive, and Palm's destiny is tied to the Palm (their own) OS.

    So how long are we going to wait for an update? WM has already updated three times.
    HP has officially ruined it's own platform and kicked webOS loyalists and early TouchPad adopters to the curb. You think after you drop it like a hot potato and mention it made no money and is costing you money, anyone else wants it??? Way to go HP!!

    And some people are fools to keep believing their hype. HP has shown they will throw webOS under the bus and people are still having faith in them??? News flash: if it's own company won't stand behind it, it's finished!
  10.    #10  
    Quote Originally Posted by The Phone Diva View Post
    My big question has been, when will they put out a flip and/or candy bar phone? Or is this out of the question for them?

    How long do they expect to keep selling full size PDA phones alone? If BB can put out a Pearl to gain mass attention, what's stopping Palm? Their stubborness to stay forever with the same form factor alone?
    Another one of the things Andy Brown said, and Ed Colligan has made similar statements, is that they're working on new form factors, and if you look at the Palm's product lineup a year from now, the devices will look very different.
  11. #11  
    Palm's destiny is tied to what the market wants, unless they think going down with the ship is a great way to enhance share holder value. They are a public company, and they have an obligation to maximize earnings to their share holders, irrespective of their personal leanings. If they get acquired they will even less control over the future direction of Palm devices.

    Re why they would shut down Palm OS, I did not say they would, but in my assessment the chance of them dropping PalmOS is higher than WM, due to prevailing market trends and the direction the market seems to be heading.

    Writing and maintaining your own feature-rich OS is hard and expensive work, and the next Linux-based OS is not going to be a simple thing like Garnet and its predecessors. To support all the features they would need to compete, they will need a lot of programming muscle and a lot of time. As HTC said, why spend money doing this when they can partner with some-one who is an expert in OS development already.

    It all comes down to ROI, and at some point the CEO/CFO may have to make some hard decisions.

    Surur
  12.    #12  
    Quote Originally Posted by The Phone Diva View Post
    So how long are we going to wait for an update? WM has already updated three times.
    Would I like to see it sooner rather than later? Yes. Would I like to see them release it before it's ready? No.

    When asked if Palm would be releasing products using the changes that they're making to the Palm OS within the next 12 months, Brown stated, "Probably within the range you're talking about, the latter half of the range you're talking about."

    I'd say he was probably being intentionally conservative. It's better to under-promise and over-deliver than to over-promise and under-deliver. And after being bitten by execution problems in the recent past (Treo 750 launch), Palm's managment is focusing on improving their execution.
  13.    #13  
    Quote Originally Posted by surur View Post
    Palm's destiny is tied to what the market wants, unless they think going down with the ship is a great way to enhance share holder value.
    If Palm feels that their destiny is tied to the Palm OS, then they believe that's what the market and their customers want. I think a great way to decrease shareholder value would be for Palm to become just another WM licensee. Clearly, they have a vision and a business plan that they're executing, with the Palm OS being a vital part their plan and vision, and they are profitable as a company. I think they know the market and their customers better than you do.

    As far as your assessment of the chance of Palm dropping the Palm OS being higher than WM, I think your assessment is extremely flawed and counter to Palm's own assessment of the market and their own customers. Read or listen to his statements again, especially the parts were he says that Palm sees the enterprise (WM) market not being a high growth market, while the consumer (Palm OS) market will be a high growth area for Palm in the future. He directly correlated each OS with which markets Palm believes each is best suited.

    Quote Originally Posted by surur
    As HTC said, why spend money doing this when they can partner with some-one who is an expert in OS development already.
    Palm is an expert in OS development already, and they've been hiring software engineers (many with Linux experience) like crazy over the past 12 months and spending a significant amount of money on R&D.

    Andy Brown:
    One of the reasons why were were able to get the Palm OS, and we're confident that we can innovate on that, is that still a lot of the people that have done those innovations are at Palm today.
    He also said that Palm has a lot of experience developing platforms and operating sytems.

    It's just a matter of time before it bears fruit.
    Last edited by ballistic; 03/02/2007 at 09:31 PM.
  14. #14  
    The problem is they're taking a bit too long. They will need to show something soon. WM is moving ahead. By 2008, if we don't see anything, Palm OS is done. RIM is cranking out BB designs to become more popular among the masses too.
    HP has officially ruined it's own platform and kicked webOS loyalists and early TouchPad adopters to the curb. You think after you drop it like a hot potato and mention it made no money and is costing you money, anyone else wants it??? Way to go HP!!

    And some people are fools to keep believing their hype. HP has shown they will throw webOS under the bus and people are still having faith in them??? News flash: if it's own company won't stand behind it, it's finished!
  15. #15  
    Palm thinks that too, but they have only had the rights to modify the OS for very short time here. I think they are very clear they felt that the PalmOS was dying where it was and they did not have control over it. They now have a way to control the OS that they use. I think due to some new hires like Marc Blank they are serious about the future of the PalmOS. I think they were wondering just as much as we were if the PalmOS was going to die.
    PalmIII > PalmIIIx > PalmIIIxe > TRGPro > Handera 330 > Zire71 > Treo600 > Treo650 > Treo680 > Treo750 > Centro > TreoPro > iPhone 32GB 3GS

  16. #16  
    I am fairly amazed with RIM's recent progress. Two years ago you didn't hear about a Blackberry in Europe. Now every European company seems to be deploying them. It's a pretty amazing story.
    ---
    iPhone / Samsung Epix

    Current playtoys:
    Also: Treo 750 (Test phone) / Sony Ericcson w900 (unlocked for international travel)
  17. #17  
    What he said is all great, but ideas are one thing, execution is another. The Palm OS at this point has a lot of snags that are keeping it from being a great OS, and there is a lot that Palm is going to have to address to fix it. WM7 is coming out in a year and a half or so, and that is going to be a huge upgrade. The Palm OS hasn't been very competitive with WM since PPC2002. Once WM5 came out, the Palm OS had still seen no major upgrades, and a couple of years later, it still hasn't developed into anything.
  18. #18  
    Quote Originally Posted by jamesgangut View Post
    Palm thinks that too, but they have only had the rights to modify the OS for very short time here. I think they are very clear they felt that the PalmOS was dying where it was and they did not have control over it.
    That is foolish and lame... sure, in THIS incarnation, Palm only recently got sufficient rights/control to work with PalmOS. But Palm has had YEARS and YEARS to do something intelligent with PalmOS. They should have come up with something even prior to the Palm/PalmSource split. Yeah I know about the stillborn Cobalt, etc. There really isn't any good excuse for PalmOS not being a robust, multitasking OS years ago, nevermind having to wait a couple more years from now... They've made many mistakes...
  19. #19  
    Palm tried; PalmSource failed to deliver on both the original and amended software licensing agreements for OS5. Then PalmSource was acquired by Access and turned focus 100% on ALP. It is only in this new licensing agreement that Palm has the rights to do what PalmSource dropped the ball on.
  20. #20  
    Quote Originally Posted by driven01 View Post
    I am fairly amazed with RIM's recent progress. Two years ago you didn't hear about a Blackberry in Europe. Now every European company seems to be deploying them. It's a pretty amazing story.
    RIM had sense enough to hybrid form factor with function a bit faster than Palm. Candy bar and/or thinner less wide BBs are easier to carry.

    Now if only we can get Treos slightly thinner(can't go too thin though) with a functional OS for the masses, either WM or Palm OS(or both). Palm OS will have to upgrade though. WM WILL become seriously dominant if Palm doesn't hurry.
    HP has officially ruined it's own platform and kicked webOS loyalists and early TouchPad adopters to the curb. You think after you drop it like a hot potato and mention it made no money and is costing you money, anyone else wants it??? Way to go HP!!

    And some people are fools to keep believing their hype. HP has shown they will throw webOS under the bus and people are still having faith in them??? News flash: if it's own company won't stand behind it, it's finished!
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