Anticipating the Palm "iPhone"

This week there was a big announcement from Palm, one that could dramatically change what you see from that company. The result could have a big impact on Apple and the cell phone industry.

Not only did they get a large influx of private capital, allowing them to significantly enhance their ability to design and build new products, but the former head of Apple’s iPod Division, Jon Rubinstein, who also ran hardware for Apple through some of their best years, will take over as Executive Chairman of Palm’s board. 

What is unique here is not only will Jon have the very highest position in the company (the CEO effectively reports to him), he will be the head of development. This is very similar to the role Bill Gates had when he was both Chief Architect and chairman of the board for Microsoft. 

This may also explain why the iPhone is not as good a product, comparatively, as the iPod has been. Jon is now free to create the iPhone he would have built for Apple, for Palm instead. 

The Fall of Apple, the Rise of Palm? 

Before the iPod was hot, the previous hot product wasn’t the Sony Walkman — it was the Palm Pilot. The Palm Pilot had its roots in the Newton and was the likely end of an evolution the Newton couldn’t get to from inside of Apple. Regardless, there is a lot of Apple DNA in Palm, but the company lacked the leadership that was needed to allow the company to sustain greatness. 

While Palm often had some really interesting designs, some of the most compelling ones couldn’t make it through what was increasingly a management structure driven by internal politics and not great products, something this latest move likely fixed.

In short, while they had the Apple talent, they lacked the kind of leadership that defined Apple. While Jobs provides a lot of that, in a large company like Palm or Apple, one person isn’t the entire company — they can only be a major part of it.

Steve Jobs has historically not done a good job of sharing credit or giving his best people what they need to remain with the company. While there are often big gaps between a CEO’s compensation and visibility and that of his or her direct reports, when that gap moves beyond excessive (as is the case with Apple), key resources leave, because they realize that if they want to advance, they have to move on. Steve Jobs also has a history of being abusive, which often motivates those that leave to aggressively go after the executive and the company they left.

Apple has been bleeding executives rather badly over the last few months. Fred Anderson, the CFO who just left Apple and who is very vocal about Steve Jobs being held accountable for option pre-dating , is also joining Palm as CFO. He clearly is very upset with his old boss’s apparent attempt to make Fred the Apple scapegoat (as a side note, Fred likely would not have been given this job had the private investors now backing Palm not agreed that it was Jobs, and not Anderson, who was behind the Stock backdating problem).

This may explain why Leopard is late (Avie Tevanian, the father of OSX, also has left the building) and why the iPhone is considered by many to be a badly designed product. Granted, the typical hype surrounding this product has been great, but the hype surrounding the AppleTV was strong as well (though not quite as strong), and AppleTV failed in market. 

We clearly don’t know how critical these departures truly are for Apple, nor how great they will be for Palm, but if AppleTV and the iPhone are early indicators for Apple and the iPod itself of what could happen at Palm, the outlook will be very interesting for both companies. 

The Palm iPhone 

Palm knows how to build a Smartphone. They now have experience with three operating systems: their own Palm OS, the Microsoft Mobile platform, and they are working on a Linux derivative. This last may be at risk, because neither Next nor Apple management liked the original GPL, and like most hardware companies, will like the new GPL even less. The Palm OS is on its last legs, and that means they will either rethink OSX using BSD as the core with a license they clearly like better, or will rethink the Microsoft mobile platform and probably emulate what Neonode did. 

Whatever path they take, look for a much slimmer, sexier Palm product, one with a keyboard for data entry and a large screen for video. Touch seems intuitive as well, but using more of a Palm, or possibly a Microsoft Surface, metaphor. Just think what Palm, with this enhanced DNA, will do with Foleo. Think of a much more appealing hardware design coupled with Apple-like software elements. Probably something that looks more like this.

The problem for Palm, or anyone else, selling a Smartphone near term is keeping folks from waiting until something amazing comes out of the new Palm. Given there is already an iPhone replacement being rushed to market that appears to address most of the initial product’s critical shortcomings, waiting may be a good thing. 

Apple woke up the market with the iPhone, so it would be incredibly ironic if someone else actually built the best iPhone — doubly so if it was Palm, largely driven by people that Steve Jobs personally drove out of the company. 

The views expressed here are solely those of the author and do not reflect the beliefs of Digital Trends.


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