Palm Pre may not match iPhone debut

New York: Palm Inc, whose stock has doubled this year on the buzz over its new Pre phone, may sell less than half as many devices as Apple Inc's iPhone did in its debut.

The Pre wowed visitors at the Consumer Electronics Show in Las Vegas this January with its WebOS operating system and wireless charger, winning the event's top honour and pushing the stock up more than 80 per cent over two days.

Palm may ship 2.6 million in the first year, according to the median estimate of 10 analysts surveyed by Bloomberg.

Apple sold 6.1 million iPhones in the year after the 2007 debut, before the worst economic slump in a quarter-century sapped consumer spending.

Palm, whose sales fell 71 per cent last quarter, has neither the base of Apple devotees from which to draw nor the BlackBerry's niche in the corporate world, said Andy Bateman, who leads the New York office of Interbrand.

"What the BlackBerry and iPhone did was to be game changers," said Bateman, whose firm compiles an annual list of the world's 100 most valuable brands. "As a brand, Palm is a little dusty. Coming from behind, it's going to have to do an awful lot to make up the difference."

The Pre received praise at CES, where event-goers cheered the unveiling and named the device "Best of CES." Pre hype has since spread to the television airwaves through the phone's March 9 appearance on Late Night with Jimmy Fallon, the comedian and talk-show host who marvelled at the software that allows users to shuffle through applications like a deck of cards.

Palm, which enlisted Sprint Nextel Corp. as its exclusive US carrier, said in January that the Pre will come out in the first half of the year. Spokeswoman Lynn Fox said it's too soon to judge how many Pre phones Palm will sell in the first year.

Sprint, based in Overland Park, Kansas, will showcase the device at its "Pre VIP Lounge" at the CTIA Wireless trade show in Las Vegas this week.

Palm, whose stock plunged 42 per cent in the year before the CES presentation, rose 13 cents to $8.59 (Dh31.52) at 4pm New York time on the Nasdaq Stock Market.

The 180 per cent increase for this year is almost eight times Apple's and compares with a 6.2 per cent jump for Research In Motion Ltd, the maker of the BlackBerry phones.

Sunnyvale, California-based Palm faces a much more difficult economic environment than Apple did when it introduced the first iPhone.

In the two years since, the US economy entered a recession and consumer spending, which accounts for about 70 per cent of the economy, fell at a 4.3 per cent pace last quarter.

"Consumer demand two summers ago or even last summer was much better and was before the market started to tank," said Matt Thornton, an analyst at Avian Securities LLC in Boston, who rates Palm "neutral" and doesn't own shares. "So it does make things much tougher for Palm."