Palm (PALM) produced both a portable wireless device and an operating system for portable hardware devices and desktops. Palm launched its Palm Pilot hardware device in 1996 as a personal organizer. In 1999, it released its Palm V. The Palm Treo smartphone was developed by Handspring which Palm acquired. In the quarter that ended in September 2005, Palm sold 470,000 Treo units, up 160% from the same quarter the year before. At that point, three companies dominated the smartphone market: Palm, Research-In-Motion, maker of the Blackberry, and cell phone giant Nokia (NOK). By the September 2007 quarter, Treo sales had only moved up to 689,000, but sales of the Blackberry hit almost 3.2 million and the newly launched Apple (AAPL) iPhone sold more than a million units during the same period after it debuted on June 29 of that year. Palm, one of the earliest makers of smartphones, was unable to follow up its success in the personal organizer business. Analysts pointed to the fact that the company was slow to realize that consumers wanted wireless voice and data from the same device. According to ZDNet, "Palm just couldn't find the formula for over-the-air synchronization with Microsoft Outlook, which business users demand and RIM nailed with its BlackBerry device." Palm also suffered from multiple product delays. The company will launch the next versions of its hardware, the Pre, later this year. Palm's stock traded for $669 late in 2000. Today, the shares trade for $11. Shares in Apple and RIMM are up between 200% and 300% over the same period. Palm could not translate its lead in one form of consumer electronics device to another.
Douglas A. McIntyre
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