Analysts refute latest Verizon-Palm Pre rumor
Will it or won't it? That's the question that Palm Pre fans are asking. They want to know if the Palm's touch-screen phone will be offered by Verizon Wireless early next year.
TheStreet.com reported late Thursday that sources close to the companies said Verizon was considering not offering the phone on its network, as had been expected. But now analysts are saying the rumors are likely bogus.
Palm Pre
(Credit: Sprint Nextel)"Our checks continue to point to healthy carrier demand for the Pre early in calendar 2010," Deutsche Bank's Jonathan Goldberg said in a research note published Friday. "We believe Palm has placed orders with the supply chain for another version of the Pre, with features highly consistent with a Verizon launch."
Verizon Wireless CEO Lowell McAdam said in June, before the Pre was even launched, that he expected the device to be on Verizon's network within six months. Sprint Nextel currently has a deal to be the exclusive U.S. carrier of the Pre.
Neither Verizon nor Palm would publicly comment on the speculation. But on Thursday, Palm reiterated its financial guidance, which it gave just last week, when it reported third-quarter earnings. In a notice announcing that the company is raising about $360 million through a public offering, Palm "reaffirmed its fiscal-year 2010 outlook, and its planned product and carrier launches in the second half of Palm's fiscal year, ending in May 2010." The E-Commerce Times wrote on Friday that Verizon's Jim Gerace had confirmed the company still plans to bring the Pre to its network in January, and a source familiar with Verizon's plans later confirmed the plans.
Several analysts have also said they don't buy the rumor that Verizon would snub the Pre. Tavis McCourt, an analyst at Morgan Keegan, said in his research note that Palm's upbeat guidance would require the company to launch the device on Verizon's network. He also pointed to Verizon's long history with Palm.
"Verizon has carried just about every Palm product in its history, and the Pre is clearly the best," McCourt wrote in his note. "We do not have insight as to the marketing support Palm will get from Verizon, but we see little risk in not getting a placement at this carrier."
McCourt also said that he expects the Pre to hit Verizon's network in February. He suspects that the rumor had more to do with investors wanting to influence the company's stock price than any actual change at Verizon. He notes that just before Palm finalized its new funding this week, rumors were circulating that Nokia was looking to buy Palm. The news of the funding deal lifted the company's stock price. And when the subsequent rumor about Verizon not carrying the Pre surfaced, the stock dipped.
"The timing of the rumor, post-deal, makes it equally as dubious as the timing of the 'Nokia will buy Palm' rumor during the roadshow," he wrote.
While McCourt agrees that it's unlikely that Verizon will spend a lot of money marketing the Pre, he said it's not unusual for carriers to spend much less on marketing a device that has already been out on another carrier's network.
"Normally, for an exclusive like the Pre or the (BlackBerry) Storm, the carrier will provide more marketing support," he said in an interview. "But the Pre will have already been out for seven months. So I wouldn't be surprised if Verizon doesn't commit as much money to marketing it."
So what is a smartphone consumer to do? Since neither company is responding to the rumors, it's difficult to say for sure what will happen. But these analysts seem pretty confident that the Verizon Pre is still a go.
Verizon consistently wins high marks for its reliable network. And the company has one of the widest coverage footprints. But customers have long complained about Verizon's lack of cool handsets. So many customers have been waiting for the Pre. And many others are hopeful that Apple's iPhone will come to wireless carrier next year.
Verizon isn't saying anything about unannounced products. But the company is building its next-generation LTE network, which will go live next year. And there is speculation that Apple might announce products that work on that network. Verizon also has its Open Development Program, which allows any device maker to quickly get devices certified for services that run on the Verizon Wireless network.
Updated at 5:21 p.m. to include a statement from Verizon to the E-Commerce Times, saying Verizon still intends to offer the Pre to its customers in January, and at 6:16 p.m. with confirmation from a source.
Marguerite Reardon has been a CNET News reporter since 2004, covering cell phone services, broadband, citywide Wi-Fi, the Net neutrality debate, as well as the ongoing consolidation of the phone companies. E-mail Maggie. 
BTW...both PALM and YHOO were up today , while Apple was down.
It`s well known Apple has a huge internal anti-ZUNE HD FUD machine.
Fact: MSFT has hired many top Apple store employees to work at the new MSFT stores.
APPL was up quite a bit midweek, but ended about where it started on Monday. However, it is up about 20 points from where it was three weeks ago. MSFT is also down today, twice as mush as AAPL.
Well known? By who and based on what sources? You say it's well known which means there must be plenty.
Last I heard, Microsoft was "attempting" to hire Apple store employees. How this makes anyone but Microsoft look bad is beyond me, but I'm sure you'll figure out a way to do it somehow. Microsoft knows Apple has done something right and wants to emulate that. They very well might succeed. Competition is good and it forces Microsoft to actually release good products, which they have been doing more of recently.
"But the Pre has been out for seven months. So I wouldn't be surprised if Verizon doesn't commit as much money to marketing it."
If he meant that it would read have not has. I don't really trust this analyst if he either does not know when a device comes out or if he can't even speak correct english.
"But the Pre will have been out for seven months if Verizon get's it in Feb. So I wouldn't be surprised if Verizon doesn't commit as much money to marketing it."
Direct quote from the article:
""But the Pre will have already been out for seven months. So I wouldn't be surprised if Verizon doesn't commit as much money to marketing it."
He didn't say "has been". He said "will have been".
From the previous article...
by gtdtm September 25, 2009 8:36 AM PDT
First of all, TheStreet.com are a bunch of idiots. Second, Verizon wanted to limit how many phones Sprint sold, hence the announcement that they would offer the Pre soon. If everyone bought on on Sprint immediately, Verizon wouldn't have as large of a consumer base hoping to get it on Verizon. I wouldn't trust TheStreet.com's analysis.
His latest piece doesn't even bother to touch on the most obvious question, which is WHY Verizon would decline to offer the Pre. As an iPhone user and devotee, I'm not a Pre fan, but I can't imagine any business case to be made for Verizon to snub a phone that is one of the better alternatives to the iPhone juggernaut. Verizon and Palm need each other. Any report that claims one is going to snub the other demands at least an attempt to answer the very obvious question of WHY that would happen. Moritz's report (and his reporting in general) deserve to be ignored, based on his track record.
If Verizon was to have plans as simple as Sprint ($69 unlimited m2m w/data & GPS) with fully functional android devices, they could easily add another 20 million customers. And that also is making me think that if Sprint gets an Android device, I just might hop over to them since their network seems to work well in most places.
As an iPhone user and devotee, I'm not a Pre fan........
Never ceases to amaze me that Iphone users are such Zealots!! They are the only umm "people" I know that have such bigotry towards other Products made by other Companies!! I mean geeze Appdroids stop being such HATERS and learn to appreciate other Products too. The PRE is awesome but that doesnt mean i can't appreciate the Iphone too. What makes Iphone users such Hateful Bigots?
I guess it is just the mentality of the users that think their **** don't stink and feel superior to everyone else just because they are sheeple and follow the apple masses. Gad not everyone thinks like them or it would be a sorry world we live in.
I have posted before about having the iPhone on Verizon. Very recently too, but I've been looking more into the android platform and I think I like what I see there even more. So, I'm waiting for Verizon to get an Android device, which I hope they won't lock down any of the core functionality.
If Verizon was to have plans as simple as Sprint ($69 unlimited m2m w/data & GPS) with fully functional android devices, they could easily add another 20 million customers. And that also is making me think that if Sprint gets an Android device, I just might hop over to them since their network seems to work well in most places.
HTC HERO check it out. LOOKS AWESOME even though id prefer a WebOs model with a bigger screen size,maybe 3.6 or so screen.
- by TrailBarge October 5, 2009 7:32 AM PDT
- "We believe Palm has placed orders with the supply chain for another version of the Pre, with features highly consistent with a Verizon launch."
- Like this Reply to this comment
-
(18 Comments)---- Hmmm... if history has anything to say about that, consistency with Verizon means that features will be disabled or otherwise unavailable until the customer subscribes and pays Verizon at a la carte prices.
They'd have a lot more "cooler handset" if they'd let the phones do what they can and if they'd stop raping the customer for each feature. My current phone has a GPS reciever. If I want to access it, I have to pay. I can understand the fee if I download POI or mapping data... but I'm not allowed to see the friggin lat/lon numbers unless I pay.
If you want to use a smartphone on Verizon's plan, be prepared to turn your pockets inside out so hard that you reach into another dimension.