CTO resigns: Will Palm lose its grip?

The latest resignation from handheld firm leads to speculation over its future

Palm chief executive Carl Yankowski wrote in a company-wide email Monday that Bill Maggs, the chief technology officer, will be leaving the company.

Maggs is resigning to "pursue outside opportunities related to the next phase of the Internet", according to the email obtained from a source close to the company. In an interview Tuesday, Maggs said he has not set a resignation date and plans to remain on as a consultant for a "couple of months".

Maggs came to Palm about a year ago from Internet infrastructure company Inktomi, where he served as chief network officer. He described his departure from Californian-based Palm as amicable. "It's not easy for me to leave. I feel like I'm going to miss out on all the fun," Maggs said. "But there are so many cool things to do."

"[One of those] cool things" might be starting his own company. Maggs wouldn't comment on his next step, but he said: "If I hadn't taken this job a year ago, I would probably be running my own company at this point." Maggs added that he sees all sorts of the opportunities related to wireless Internet access and plans on doing something to address them.

As for Palm, Maggs said the company has already laid out a strategy to become more focused on wireless Internet access. Now, it just needs to turn that strategy into a reality. Maggs asserts that Palm will be successful in such efforts because the values that helped the company become the leading handheld maker system are still in place. In his email, Yankowski wrote that Maggs played an "important role" in developing new devices and wireless services. Yankowski did not announce a successor.

Reactions from analysts to Maggs' resignation varied. "Palm is riding tremendous momentum, with the top spot in market share and solid financials on top of that. I don't see this derailing that," ARS analyst Matt Sargent said. Giga Information group vice president Rob Enderle was not so optimistic. Enderle said Palm may be depending too much on past glories. "Much of Palm's current success is based on products that were built by people that are no longer with the company," Enderle said. "Bill's resignation is not a good sign."

Enderle said rumours are flying in Silicon Valley that Handspring and Sony, which license Palm operating system, are shopping for a new OS. "No one is ever comfortable licensing from a competitor," he said.

IDC analyst Alex Slawsby took a more diplomatic angle, saying it's too early to tell what kind of effect the resignation will have on the company. Maggs' resignation follows that of other key players, including the recent departure of Mark Bercow, who left his position as vice president of strategic alliances and platform development in October to join Atheros Communications, a Californian-based wireless chip company.

Other organisational changes announced in Monday's email include a new vice president of software development, Ruth Henniger. Henniger comes to Palm from Cobalt Networks, where she was vice president of product development.

Ian Fried contributed to this report.

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