Palm Admits the webOS Isn’t Catching on as Fast as it Hoped

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Palm, Inc. warned investors today that it isn’t bringing in as much revenue from sales of its smartphones as it had originally forecast. The company’s new webOS is facing tough competition from rivals like the Android OS and Apple’s iPhone.

A statement from Jon Rubinstein, chairman and CEO, admits “Driving broad consumer adoption of Palm products is taking longer than we anticipated,”

Still, the head of Palm remains optimistic: “Our carrier partners remain committed, and we are working closely with them to increase awareness and drive sales of our differentiated Palm products.”

Not surprisingly, today’s announcement hasn’t been good for this company’s share price — it’s down nearly 20% on the day.

Is Being Good Going to Be Enough?
Generally speaking, reviews of the webOS and the smartphones based on it have been very positive. But there are so many operating systems for mobile devices available that Palm is having a hard time standing out from the crowd.

Consumers are snapping up BlackBerrys and iPhones in large numbers, and there’s strong interest in Google’s Android OS from both developers and phone buyers.

As a result, sales of the Palm Pre and Pixi have been anemic. Verizon launched updated versions of these smartphones last month, and today’s announcement from Palm makes it clear that customers haven’t exactly been buying them up in droves.

Still, AT&T says it will release webOS-based devices at some point soon, which might help Palm’s bottom line a bit.

Source: Palm

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