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Palm's Forecast

full-year revenue would be “well below” its previous target of $1.6 billion to $1.8 billion. Wall Street was expecting $1.6 billion

If we assume $1 billion/yr. revenues, that works out to about 3 million smartphones a year out of a market that Gartner just forecast to be 215 million this year. That gives Palm just 1.4% share of smartphones.

The WebOS is a fine piece of code, but one has to understand that success in this business is not just doing something right. You have to do everything right:

  • Nokia has great distribution and logistics, not so good software or platform story
  • Palm has great software, not so good distribution or platform
  • RIM has great distribution and service, not so great software
  • Android has good software but not great integration of solution
  • Apple’s software and platform are great, but distribution is still weak
  • Microsoft has nothing good at all

The question of acquisition invariably comes up. The obvious answer would be to pair Palm with somebody who needs what they have and who has what they don’t. Unfortunately no perfect fit arises.

UPDATE 3-Palm cuts revenue view on weak phone sales | Reuters