Should Dell buy Palm?

Should Dell buy Palm?

Summary: Dell is allegedly pondering a smartphone, but a better move may be to merely buy Palm now that it illustrated that its Pre and WebOS are the real deal.A Dell-Palm combination is floated by Bob Faulkner, a contributor to RealMoney.

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Dell is allegedly pondering a smartphone, but a better move may be to merely buy Palm now that it illustrated that its Pre and WebOS are the real deal.

A Dell-Palm combination is floated by Bob Faulkner, a contributor to RealMoney.com. In an open letter to Michael Dell, Faulkner makes his case (you can also find via Yahoo Finance):

With the advent of the Apple iPhone in 2007 and its subsequent imitators, it has become apparent that we're seeing "computing" evolve once again. Phones are no longer just something you speak into. They have transformed into a portal for taking the Internet wherever you go.

I realize that you have been busy the last couple of years trying to right the good ship Dell, but your lack of participation in this market segment will hurt the company going forward. There is another rumor making the rounds that you've been feeling out suppliers in an attempt to enter the market at some point. While, if this is true, I'm glad to see some movement on this front, I fear that this approach is doomed to fail.

Let me be so bold as to suggest that there is a ready-made solution for you that I recommended nearly two years ago: Dell should buy Palm. Think about it, Michael -- it's a match made in heaven. You get a solution, and they get the stability, influence and purchasing power of Dell.

Faulkner further argues that Dell could help Palm out with its two biggest hurdles. First, Palm needs to attract software developers and Dell's heft can help (with a few financial incentives of course). In addition, Palm needs distribution. Dell has that in spades.

Add it up and the Dell-Palm combination makes some real sense. Thoughts?

More reading:

Topics: Hardware, Browser, Dell, Mobility, Smartphones

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8 comments
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  • Nokia

    I loved Palm Pre UI, but I am not sure if the
    innovations it brings are enough to save Palm. I think
    it will depend on price (and if so, it is not so
    innovative).

    I think Dell buying Palm is a win-win game. But what
    about Nokia? Wouldn't it be a good business as well?
    fredguth
    • Re: Nokia

      i guess Nokia would be too expensive to buy... compared to Palm... haha...
      xkiller213
    • Re: Nokia

      Did you suggest Dell buying Nokia or Nokia to buy Palm ? ;-)

      I would say the latter would still help them at least on the practically non-existing Linux front. webOS is said to be based on Linux or another open OS, so while Nokia is very strong on Symbian the Open structure and community around Palm could help them. Symbian always lacked developers compared to Palm e.g. when PalmOS was still big.

      Of course Dell or another big HW and device maker could profit from that as well. IBM once tried to brand their own Palm devices, but gave it up after a while. As IBM is no longer making HW and computers by itself only a company like Lenovo may compete with Dell on such a bid. Dell or other PC vendors might even profit from a <b>DUAL</b> strategy Palm was going for a while now. By supporting Windows Mobile just as well as its own OS. Users might be irritated by this, but a large vendor like Dell, Lenovo, Toshiba or others could afford if not to say require more than one mobile OS under their wings.
      catmedia
  • RE: Should Dell buy Palm?

    Dell could save Palm for this time. But, they would destroy the innovation that made Palm for the future. Is that a fair trade?
    jorjitop
    • Not a fair assessment... entirely.

      While the consumer side has seen a question in its acquisition of Alienware and the end-result, you have to look at Dell a a whole to see if that's a true statement. Consider their acqusition of EqualLogic, Inc last year--that product line has not been stifled at all and the innovation that drove Dell to make that huge cash purchase still thrives today in development.
      MJWatt
  • RE: Should Dell buy Palm?

    No. The cultures and business models are completely at odds with each other. Palm (and most smartphone companies) have to innovate to stay ahead of the wannabes. They spend a lot on R&D, ramp up a new phone or new technology and get their revenues quickly.

    Dell doesn't innovate. Dell takes its time to learn a market, then commodotize it, then use its supply chain power to drive as much cost out of it as possible once the market is mature. Dell is a wannabe that simply makes the same things the innovators do - cheaper.
    SWMCinci
  • No, they should resurrect the Axim

    Dell should bring back their much loved Axim PDA line. With more recent technology - smaller, faster and easily able to add a phone abilities to it.

    If Dell had had the nous 2 years ago, a Windows Mobile 5 based Axim X51v (with it's ferocious 624MHz StrongARM CPU) with some clever HTC style software masking Windows Mobile, could have easily been an iPhone Killer, before it was launched.
    neil.postlethwaite
  • Buy LOW, Sell HIGH

    Remember Snapple?
    3dguru