View Poll Results: Palm's release of the m500 and m505 was

Voters
21. You may not vote on this poll
  • Brilliant business move to counter Handspring and Sony

    0 0%
  • Brilliant business move, but caught in a sliding US economy

    4 19.05%
  • ill-conceived move, failing to consider the m50x's affect on own inventory

    10 47.62%
  • cue Homer Simpson!! "DOH!!"

    7 33.33%
Results 1 to 9 of 9
  1.    #1  
    Just a little poll in light of the recent news of Palm's financial troubles. The article in fools.com made some very interesting comments about Palm's move to release the m500 and m505 way ahead of schedule.

    http://www.fool.com/news/2001/palm01...01&ref=yhoolnk

    Some interesting quotes:

    "After rival Handspring (Nasdaq: HAND) unveiled its Visor Edged recently, the end-all of the Palm VX, Palm rushed the launch of its m500 product series. Palm gave the new product major props at the CeBit show last week, but an unfortunate side effect was that it couldn't ship enough of the devices to retailers. With Palm struggling to unload the older Palm V, retailers pulled orders back and Palm got stuck. Making matters worse, Palm forecasts a $200 million increase in inventories next quarter."

    At first Palm's move to announce their new models seemed quite a well-constructed coup against Handspring's release of the Edge. Palm announced the m500 and m505 followed by the annoucement of all the support companies that are going to make future accessories for the new models.

    However, did Palm fail to anticipate the effects of decrease Palm Vx sales because everyone and their mother are waiting for the new units and as a result, causing a huge back-up of Palm Vx's that no-one would want? (I could almost hear Homer Simpson on this one.) ...Or did Palm just an unfortunate victim in the slow down US market?
    Last edited by Fat_Man; 03/30/2001 at 10:56 PM.
    Fat's
  2. #2  
    Originally posted by Fat_Man

    However, did Palm fail to anticipate the effects of decrease Palm Vx sales because everyone and their mother are waiting for the new units and as a result, causing a huge back-up of Palm Vx's that no-one would want?
    I always assume that companies have their inventories in control, but for some reason many don't -- Apple is a famous example. (Apple also likes to preannounce products, like Palm just did.)

    In Palm's case, they did cut the Vx price $50 as soon as the m500's were announced, so they kind of knew something was needed to keep Vx's moving. But $50 isn't enough. Would you rather save a measly $50 for last year's technology, or get the latest and presumably greatest? If I was paying that much money on a PDA, I wouldn't be settling for second-best. IMHO they should've lowered the Vx to $300, at least.

    Imagine if HS announced a new Vpl with, say, OS4.0, flash memory and a slightly better screen for $300, and then lowered the current Vpl price 12%, to $265. Would you be saying "oh, that old Vpl is a steal, let me buy two before they're all gone"?

    Does anyone know how well the m100's are selling, and how much profit Palm makes from them? I'd be surprised if anticipation of the m500/5 was the sole cause of Palm's problems.
    Last edited by dalamar70; 03/31/2001 at 05:38 AM.
  3. #3  
    I think M100s were a smash hit, which surprised me w/all of its limitations.
    Palm was always famous for doling out dribs & drabs of tech. & keeping their prices high w/almost no R&D for so many years. They could do this because of no real competition w/the 10,000 Palm OS apps out there.

    But I think it was a mistake to pre-announce. They should have given HS a "month in the sun," who cares. If HS didn't release a color edge in that time, I bet plenty of people would still have switched back, esp. w/the SD card factor.
    But now the SD card factor works against anyone buying a Vx. As was noted, last yr's tech.
    They should have concentrated on dumping inventory 1st.
    Oh, well -- this is Palm; they'll recover. They've hardly made a truly "stupid move" in 5-6 yrs.
    "Great Spirits Have Always Encountered Violent Opposition From Mediocre Minds." -- Albert Einstein
  4. #4  
    Originally posted by bkbk
    They've hardly made a truly "stupid move" in 5-6 yrs.
    They forced Hawkins and company to leave and form Handspring. That WAS a stupid move. I think its time Palm reconsider its role and keep itself in the software business. Its losing marketshare like crazy. I definitely would not buy their stokc.. Handspring ont he other HAND (pun intended) is another story. They have no where to go but up.
  5.    #5  
    Originally posted by yardie

    They forced Hawkins and company to leave and form Handspring. That WAS a stupid move.
    I agree completely, they should not have let Hawkins and company leave. If you think about it, what has Palm done since Jeff and Donna left to form Handspring?

    Since 1998(?) when Hawkins and company broke off, except for the m100, Palm has not done anything significant until now. In the meantime, look at all the moves by Palm OS licencees in the past two years:

    Visors: solo, deluxe, Platinum, Prism, Edge
    TRGpro
    Sony Clie: PEG-N300, PEG-N500c, PEG-N700C

    The products above were not merely clones of Palms, they each incorporated new innovations, while Palm remain stagnant. The sad truth is that Palm lost a lot more than employees when Hawkins and company left, they lost their innovative spirit.

    Instead of leading the PDA movement, Palm is playing catch-up ever since Handspring was formed.

    I think that Palm's mistakes are catching up with them. Like the Fools.com article...their dominance in the PDA market is about to end.
    Fat's
  6.    #6  
    Fat's
  7. #7  
    It's nice to see that Jim Seymour prefers the Edge!

    Seriously, this isn't exactly news to me, I've been saying the same thing for some time. Palm is slipping, both in market share..and in the innovation department. They haven't really offered a truly new product since the VII. And that was pretty much a flop. I smell trouble ahead for the Palm platform, as much as I love it. Like I've said here many times before...Palm can not survive on OS licensing. Palm will never become the Microsoft of PDAs, because they don't make the same profit margins on OS licensing that MS does with Windows on the desktop. And I have a sneaking suspicion that one day in the not too distant future, Palm could pull the plug on Handspring. Especially since Palm is losing much of it's market share to HS. Microsoft is gaining some ground too, but not that much...they are a non-threat. If Handspring knocks Palm down into the 40% range of market share, the sh!t is going to hit the fan. Jeff Hawkins may already know this, and perhaps that was the basis for his remarks on licensing other operating systems. Don't let the smiles and pats on the back fool you, underneath those facades, HS & Palm are bitter rivals. But Handsprings success lies, at least in part, at Palm's mercy. The only alternative for HS will be to go with a competing OS. I just hope that if that day comes..they don't go with PocketPC. I'd rather see Hawkins develop an entirely new OS from the ground up. Maybe even the JavaOS or Linux.
  8. #8  
    Originally posted by dalamar70


    I always assume that companies have their inventories in control, but for some reason many don't -- Apple is a famous example. (Apple also likes to preannounce products, like Palm just did.)
    While you're correct about Apple in that they preannounce to drive demand (which eventually they can't meet - take a look at the TiBook), what you fail to mention is that they usually do a decent job of controlling the channel once the supply is there. Prior to a major product announcement, they usually try to empty the channel of the new product's predecessor prior to the product announcement (again, see the TiBook: about 2 months before MacWorld SF, Apple announces major price drops on the PBG3 line, which drives sales, which helps clear the channel for the TiBook.)

    Palm's mistake here was that everyone knew the m50x's were coming, and they didn't take the appropriate steps to clear the channel of the Vx before CeBit. At this point, they may need to consider a steeper price drop on the Vx if they hope to sell them off, especially with the press declaring the m500 the superior monochrome machine (and with HS breathing down their neck.)
  9. #9  
    Originally posted by yardie


    They forced Hawkins and company to leave and form Handspring. That WAS a stupid move.
    I tend to think of this as 3Com's fault, as opposed to Palm; but depending on the post-Palm/3Com split, you could argue it either way.

    In any case, I agree that the loss of Hawkins and Dubinsky and others was a serious blow to Palm -- one that, I think, is showing up when it comes to innovation by the various companies. Handspring has, by and large, been leading the pack in that area.
    Jeff Meyer

    "And he died like he lived: with his mouth wide open."

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