Reading Palm's Future!

Catchy title in the newspaper coupled with my continued loyalty to Palm products and upgrades prompted me to blog this.

Once upon a time, in a simpler world before cell phones became teenage accessories and workplace necessities, a Silicon Valley startup called Palm Inc. launched a mobile revolution. Its creation of the PalmPilot, an easy-to-use hand-held computing device, meant people were no longer tethered to their PCs. It could hold addresses, phone numbers and to-do lists — all in the "palm" of your hand. More than one million were sold within 18 months.

Along the way, Palm has changed ownership, lost its creators, won the creators back and most recently found itself looking for new ownership options. At the same time, the company that changed the mobile landscape failed to keep pace with consumers' changing taste. It was late to mobile e-mail and lost momentum to the BlackBerry. It most recently failed to anticipate the preference for slim smart-phones, continuing to sell the relatively hefty Treo.

"Palm is viewed as somewhat antiquated in the minds of consumers," said Tavis McCourt, a financial analyst with research and investing firm Morgan Keegan. So, when the Sunnyvale, Calif., company agreed last month to sell a 25 percent stake to a star-powered private equity firm that would inject money and bring in fresh talent, investors thought they might have found Prince Charming.

Elevation Partners, co-founded by U2 lead singer Bono, will infuse Palm with $325 million in cash. As part of the deal, former Apple Inc. senior vice president Jon Rubinstein will become executive chairman at Palm. Rubinstein was a key executive in creating Apple's phenomenally popular iPod digital device.

But this latest twist in the story offers no guarantees. The new team faces two immediate and daunting challenges: introducing a new thin phone and competing with the iPhone. While Palm executives say it will take years to see any new phones or gadgets from the deal, Wall Street says the company will need to move fast to catch up with the rapidly changing mobile marketplace.

By Christmas, Palm will need to introduce a thinner, sleeker version of its latest commercial success, the Palm Treo smartphone, which was introduced in 2002, analysts said.