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Impact of the Palm Pre

Having the Palm Pre only being in the market for a few days, the exclusive seller of Smartphone, Sprint, has kept its sales numbers a secret. Analyst have estimated the reach of the sales to more than 300 000 units by the end of June, in spite of the small amount of machines available at the release, just 120 000. Some stores report having sold out on the day of release.

Palm Inc. is following the device's sales closely and is hoping the Pre is the company's so called "Savior". Also for its provider, Sprint Nextel Corp, the boost this device is creating can make them overcome the demise and the extremely low sales of their near past products and help them try to retake is pioneer position in mobile devices market, lost since the 90's with Palm Pilot. So far the expectations at Wall Street have been exceeded, and the trade of Palm Inc's shares was up 14% ($15.83) in June 25. Maybe this could strengthen the brand name in the eyes of the consumers.

The sales of Palm Pre in the second half of the month (June) have slower down a little, with the estimate being 30 000 units sold this last week, compared to the nearly 40 000 in previous weeks, but with the promise of new apps for the Smartphone the sales should increase again. Developing new downloadable content and programs is a "must" in the case of this kind of device, and the quality of the apps is a big factor; the Palm online store only supports 40 apps, a very small amount if when compared to the 50 000 available in Apple's App store. Palm plans to release a new set of tools to develop and put on sale new apps early this summer. At this moment the supply and demand of the Smartphone is almost even.

Currently Palm Inc. is preparing for an international release of the Pre by this Christmas. Telefonica will be the seller in Spain (through their Movistar Brand), the United Kingdom, Ireland and Germany (O2 Brand). Almost all the specifications are unchanged from the US version, but the device will have support for UMTS (3G) and HSDPA (3.5G) data. One curious fact is that despite the Pre and the iPhone being competitors in the US market, in the UK they both run under the O2 network. Europe is too important a market to ignore and, with the success of the Smartphone, is an opportunity to increase not only sales but in popularity as well.

Jon Rubinstein, CEO of Palm Inc., has gone on record saying: "Now we're getting on the playing field, and we're going to be extremely competitive. But it's the beginning."