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BlackBerry Limited Message Board

  • jameydimon jameydimon Jan 22, 2013 4:12 PM Flag

    PALM: A Cautionary Tale

    The recent increase in share price for RIMM reminds me of the hype surrounding Palm's attempt at a comeback. Palm was once the leader in mobile business technology with the popularity of the Palm Pilot PDA. Palm's PDAs were extremely popular with business professionals and easily dominated the market. At one time, PALM's share price rose to $95/share. Palm rested on its laurels and continued to pump out PDAs with little new innovation. Soon, the competition started making better devices and when the mobile phone industry exploded in the early 2000s, Palm was left behind. The company failed to stay one step ahead and it cost them. In 2009, Palm put all of their chips on the table and developed the Palm Pre smartphone with its WebOS software. There was much hype about this new product and soon shares rose from $4/share to $20/share, peaking just a few months after launch. Only 8 months following launch, Palm cut its guidance due to weak demand and the stock price returned to $4/share. Within a 12 month period, the stock went from $4 to $20 and back to $4 again. People loved WebOS but it just couldn't gain any momentum against the likes of Apple and Samsung. Palm was too late to the party. Even with good hardware and software, they just couldn't compete with the well established iPhone, who by that time had already won market share due to their integration with iTunes and Macs. Fast forward to 2013 and we see RIM attempting a similar story; a company who in its glory days who failed to innovate, got crushed, and attempted to deliver a "game-changer" years later among much hype. We already know how the story ends. RIM failed to deliver when it mattered most and it will be a miracle if they can re-establish themselves. They are the ultimate underdog in an industry where underdogs get killed fast. How do you win when everyone has iTunes, Macs, iPods, iPads, AppleTV, Android phones, Android tabs, and even Microsoft computers? RIM has no ecosystem of devices and software, making this one hell of a Hail Mary.

    http://www.businessinsider.com/chart-of-the-day-the-rise-and-fall-of-palm-2010-2

    Sentiment: Sell

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