Don't bet on Lenovo saving Palm
Summary: Lenovo has reportedly emerged as the leading candidate to buy Palm after HTC bowed out, but would the PC maker really pull the trigger? Logic dictates that Lenovo is an unlikely savior.
Lenovo has reportedly emerged as the leading candidate to buy Palm after HTC bowed out, but would the PC maker really pull the trigger? Logic dictates that Lenovo is an unlikely savior.
Reuters is reporting that Lenovo is in the running for Palm, which is up for sale as it tries to avoid a death spiral. Lenovo emerged as a likely buyer after HTC bowed out of the running. Reuters cites investment bankers who note that Lenovo "is looking into" buying Palm.
But here's the problem. Anyone around the tech industry more than an hour or two realizes investment bankers will tell you anything. After all, these bankers are trying to sell Palm. Lenovo would allegedly pay $1.3 billion or so for Palm.
Now it's time for a reality check. The Reuters story notes that Lenovo has been a buyer of faded brands before and cites the company's purchase of IBM's PC business in 2005 and an attempt to buy Packard Bell. The entire Palm theory seems to rest on the concept that Lenovo wants to be U.S. player and will spend money to get there. But what does Palm bring to the table here? Lenovo's purchase of IBM's PC business made strategic sense. IBM's PC business wasn't perfect, but let's just say the ThinkPad and thousands of corporate accounts are in a league much higher than the Palm brand.
Simply put, the Lenovo bid may still happen, but doesn't exactly add up. Here's why:
Yes, Lenovo is getting back into the smartphone market and lacks a presence in the U.S., but it doesn't need Palm. If Palm had more market share perhaps a deal would make sense. All Lenovo would get from Palm is an operating system and intellectual property. Palm's hardware prowess and ability to crank out new designs are questionable (we're still on the Pre aren't we?). Lenovo has the the manufacturing heft and designs that are better than Palm's setup now.
Lenovo's smartphone strategy can begin and end in China. Lenovo already has an Android-powered smartphone, the Lephone, ready to hit the market in China. China is a massive market and Lenovo can be a hit at home and do just fine. Lenovo can take its designs for the China market, run them through its North Carolina hub and enter the U.S. if it wants to in the future.
Why add a distraction when business is going well? After weathering a downturn, Lenovo is on a roll just as corporate IT spending is about to pick up. Why would you add a distraction to that mix? IDC data indicates that Lenovo was the fastest growing PC firm in the first quarter with 8.8 percent global market share.
Macquarie analyst Patrick Yau adds:
The corporate boost should still be the key catalyst for calendar 2010. With most corporate PCs still on Windows XP vintage 2001, a boost from PC renewals in the corporate segment would be an important driver for the PC industry. With Lenovo still more exposed to the corporate market from the perspective of sales mix, we believe it stands to be one of the beneficiaries as this scenario progresses, notwithstanding its recent efforts in boosting its exposure toward the consumer segment.
In other words, it's time for Lenovo to harvest. It's hard to make the case that Lenovo should spend half of its $2.4 billion in cash on Palm.
Related: HTC will not be bidding on Palm; Lenovo still a possibility
Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.
Talkback
RE: Don't bet on Lenovo saving Palm
I doubt it too
"two horse race" ???
Nokia/Intel will also be a player, with their scheme to combine support apps built on for KDE *and* Moblin *and* Maemo. (They call it "Meego".) They're targeting everything smaller than desktop PC's -- phones, netbooks, TV software, refrigerator software, and so on. So I see at least 4 survivors.
But Palm will NOT be one of them. By failing to provide a decent migration path from their old operating system, PalmOS, into their new one, WebOS, they left vast numbers of their old customers stranded on the old devices -- and the software App vendors are investing their migration efforts into other platforms (iPhone, WinMo, Android... and soon, Meego).
Larry's absolutely correct-- other companies don't see WebOS as a "valuable asset", because it can't support all those old PalmOS apps. It's just a distraction, like a splinter in your foot. I think that the ultimate price will vastly less than the $Billion-plus figures being spread around by the current takeover Marketing efforts.
But there's more than two survivors in this market. Microsoft has [i]defacto[/i] monopoly power, and Vendors keep pushing out phones on brain-damaged WinMo 6: WinMo 7 will be a winner for everyone (Microsoft, and phone vendors, and consumers, whose phones might stop locking up every couple of minutes). Nokia has been lost in the woods for years, but finally has a software strategy better than "patch and cludge, call it a new release", for moving forwards. They're still a big player at the non-smart lower end of the market. This tactic of sharing the work with Intel, who wants to target Atom against ARM, looks really great for attacking the high end-- perhaps all the way up into the netbook arena.
Google and Apple are already big winners with platforms built out of modern design techniques, but WinMo and Meego will be big winners too. Palm will offer a few bits of new, cheap hardware to phone companies at attractive prices-- just as an effort to prove they're still around.
They're not. They're already dead.
Migration Path
You said:
[i]But Palm will NOT be one of them. By failing to provide a decent migration path from their old operating system, PalmOS, into their new one, WebOS, they left vast numbers of their old customers stranded on the old devices -- and the software App vendors are investing their migration efforts into other platforms (iPhone, WinMo, Android... and soon, Meego).
Larry's absolutely correct-- other companies don't see WebOS as a "valuable asset", because it can't support all those old PalmOS apps. It's just a distraction, like a splinter in your foot. I think that the ultimate price will vastly less than the $Billion-plus figures being spread around by the current takeover Marketing efforts.[/i]
Palm certainly made many mistakes when it released WebOS (chief among the technical mistakes, the delay of the SDK until well after the release of the Pre), but failing to provide a migration path isn't one of them. Larry never even comes [i]close[/i] to arguing that in this article. Basically, his main argument is that Palm doesn't have hardware designs that Lenovo would want, and WebOS doesn't have a lot of market share. (There's no speculation in this article as to why.)
And for the record: There [i]is[/i] a migration path for people from PalmOS to WebOS. It's called Classic. You can argue that they didn't provide a [i]free[/i] migration path, but you can't argue that they (through MotionApps, of course) didn't provide one at all.
The main source of Palm's current troubles (besides the aforementioned ill-conceived timing of the SDK release) was the absolutely [i]miserable[/i] job they did marketing the Pre. Any marketing they did outside of their own website was all style, no substance. The "creepy Pre girl" very nearly killed the company all on her own (although it wasn't her fault, as she was just reading the lines she was given, the way she was told to do it).
I don't know what the future holds, but people shouldn't forget that Palm has been counted out several times before. They were circling the drain in 2009 before CES. Hopefully, they can put out another device or two that will spark some interest, and pay a little more attention to their marketing campaign (which I humbly submit means laying off the herbal tea this time around).
RE: Don't bet on Lenovo saving Palm
RE: Don't bet on Lenovo saving Palm
Don't count either Palm or Lenovo out at this point. {Jonathan}
Palm May Not Be Salvageable
It continues to enthrall much of its current customer base with the new features, but continued failure to honor old features is chiseling away at that customer base.
I didn't make the jump from Centro to Pre because they took away two important features, and inquiries about it got me a red slap in the face.
I waited for them to recover, but I do not think they were nimble enough to honor both threads, old and new, and without both, they were doomed to die.
Sad. They are the kings of Sync. And soon that will need to be changed to "They were the kings of sync."
When my Centro dies, I guess it'll be time for a Google Nexus 1. I'd get a Droid, but a world of doesn't, Droid doesn't do Sprint.
:: sigh ::
Droid and Sprint
Sprint. I have a Samsung Moment and love it (once
I updated the firmware). Now if they would get
that 2.1 upgrade out for the Moment...
Palm's biggest mistake was being way too late with
the WebOS SDK...
Palm's Biggest Mistake
You said:
[i]Palm's biggest mistake was being way too late with the WebOS SDK...[/i]
I don't think that's true. Sure, it was a mistake, but it wasn't the biggest one. The [i]biggest[/i] one was their stupid marketing campaign with the creepy girl. They had a brand new product, and instead of actually [i]showing[/i] consumers the product, they had a girl [i]holding[/i] the product while looking pharmaceutically sedated and spouting Zen philosophy. There's just no other word for it than stupid.
Bingo
The initial ad campaign nearly convinced me NOT to get a Pre.
Two Important Features?
From context, I take it that desktop sync was one of the features you feel is missing from the Pre. What's the other one?
As far as I can see, the thing most lacking in WebOS is a robust PIM system. Is that what you meant?
I can kind of see that, but I think PalmOS (the old system) wasn't as great as people are making it out to be on that score. There were a lot of third party apps (Agendus, DateBk, etc.) that improved upon Palm's basic PIM functions that people used to pick up the slack.
I do hope the next version of the OS allows users to link things a little bit more, though, and adds categorization.
RE: Don't bet on Lenovo saving Palm
But instead of working to improve the WiFi, the ability to use the web, the ability to do flash, etc. These companies are just spending all their money and effort into trying to look like an iPhone, have touch like the iPhone, and match the iPhone specs. The result is a bad phone, with bad battery life, and no features...that looks just like the phone you should by instead.
They need to meet needs, not match trends.
Some of that isn't RIM or Palm's fault.
You said:
[i]But instead of working to improve the WiFi, the ability to use the web, the ability to do flash, etc. These companies are just spending all their money and effort into trying to look like an iPhone, have touch like the iPhone, and match the iPhone specs.[/i]
I have a Palm Pre, and I've used the iPhone. Aside from the size and the gestures, there's not a lot of difference between the two browsing the Web. The Pre has the same zooming in and out, can render pages accurately, etc. In fact, the Web experience is quite pleasant. What it doesn't have is Flash, but that's got nothing to do with Palm. That's Adobe dragging its feet. Now that Apple has given Adobe the finger, maybe Adobe will advance their schedule a little bit to get a mobile version of Flash out the door for other platforms.
Why buy something that tries to be something else ??
As an ex Palm user of many years ago; and being expected to purchase basic readers, and NEEDING to buy anything that offered editing functions I decided long ago to never go near them again. Palm have yet to learn (and they're not alone) that you only need to pi$$ someone off once and they'll take an awful lot of convincing to come back.
WHY would anyone buy technology that nearly does what something else does? It ain't worth much unless they've got some decent patents and I doubt that. Palm stinks in my oppinion and is a dead duck! Power to the innovators like HTC, LG etc...
It's a shame about the shareholders but they left the board in place and it's them that's let thecompany go down the pan. That's no reason to buy a company though! Let it sink now, and let the consumers buy goods with aa future.
Who said it needs to be a cash deal?
I could see it happen actually.
href="http://www.chatalwid.com/">شات اÙ?Ù?د</a>
RE: Don't bet on Lenovo saving Palm
RE: Don't bet on Lenovo saving Palm
RE: Don't bet on Lenovo saving Palm