The Technology Stig

So Palm is on sale again. The failure of the pre and pixi to make a buzz among consumers and translate into revenues for the company was the last straw in this re-run of ‘Palm resurrection’.

Commentators and analysts have given their views on it and most of them have focussed on how, despite having a winner in webOS, Palm failed because of their atrocious marketing campaign plus the fact that they were tied to sprint when they launched the pre and the pixi. Can’t argue much about that, but there was also a big fundamental problem with this attempt at Palm resurrection, the loss of the old Palm ecosystem.

Palm (Handspring) was the first company to make a successful transition from just a PDA to a PDA with phone. The Treo line of phones were one of the most popular smartphones in the early part of the last decade. Some of the first application stores on the web were sites like Handango, PalmGear etc. that were built to satisfy the ever growing demand for applications on the ‘Treo’. The Palm developer community produced tons of applications, despite the severe restrictions placed by the Palm OS environment.

Consumers absolutely loved this, resulting in them buying plenty of applications for their devices and becoming extremely loyal to the company – to the point that if they wanted to buy a newer phone they would buy a newer ‘Treo’.

With so much going for them, Palm still managed to botch it up because they failed to innovate in terms of both hardware as well as the OS. Instead of trying to fix this, they went ahead and tied up with Microsoft to bundle their OS with the ‘Treo’. This antagonized a lot of the native Palm OS developers and consumers who actually saw a regression in terms of phone quality and performance.

The ecosystem that they had helped create was withering.

Consumers started moving to better phones, developers began developing for more lucrative and ‘geared for the future’ platforms. The application stores began supporting more device platforms with less emphasis on Palm OS. Incredibly, Palm’s answer to this was to spin-off the company making the OS, selling it to ACCESS while it tried to keep it’s focus solely on the hardware.

The last remnants of the ecosystem also got destroyed.

When Palm finally started to ‘get’ the fact that an ecosystem (software, developer, consumers) is as important as the platform (as shown by Apple and BlackBerry) and created the webOS, it was too late in the day. Consumers and developers had moved on and had different expectations, which were in part set by the iphone and the android devices. The old application stores are no longer relevant in their segment since most device/OS manufacturers now had their own inbuilt application stores. For Palm, building the new webOS was actually the easy part, building back the ecosystem was just too difficult.

Now the entire sale/resurrection drama is again in full flow. Will the new buyer be able to ‘resurrect’ Palm and give webOS a new lease of life? I don’t know.

The only take away from this is: platforms which do not learn to nurture their ecosystem are destined for failure.