Come Clean, Verizon: Palm Pre, Or No Palm Pre?


Well, which is it, Verizon? Palm Pre, or no Palm Pre? That's the question racing around the smartphone universe following a Thursday report from The Street that Verizon has chosen not to support the Palm Pre.

If that's true, it would be a 180-degree reversal of Verizon's previous position. In May, Verizon Wireless CEO Lowell McAdam suggested that a Verizon-supported Pre was six months away, and about a month after that, several reports indicated that the Verizon-carried Palm Pre would drop in January 2010.

Palm Pre was released in June and is carried exclusively by Sprint -- a sleek new smartphone seen as a potential savior to both companies, which take a backseat to smartphone makers like Apple and Research In Motion and rival telcos like Verizon and AT&T. But additional carriers are crucial to Palm's long-term viability with Pre, and losing a chance at Verizon means losing at chance at the country's largest.

Palm did reiterate to Bloomberg and other news outlets yesterday that it still planned to add more carriers by 2010, but thus far has added only Telefonica's O2 in the United Kingdom and Bell Mobility in Canada. The setback with Verizon, according to The Street report, is because Verizon is concerned about less-than-gangbuster Palm Pre sales and is not interested in selling Pre apps through Palm's App catalog or any other outlet than its VCast app store.

Be that as it may, Verizon should make clear where it stands on Pre. Verizon didn't return a Thursday night request for comment by ChannelWeb, but The Street's report did send Palm shares down 4.7 percent in late day trading.

Palm is counting on Pre -- and its recently announced sister phone, the Pixi -- to prop up its flagging smartphone fortunes. Palm posted dismal first-quarter results last week -- its ninth quarterly loss in a row -- but did see smartphone shipments rise 134 percent from the previous quarter. Palm didn't break out how many of the 823,000 units shipped were Pres, but most analysts projected Pre was responsible for between 500,000 and 540,000.

Last week Palm also announced a common stock offering of 16 million shares. Earlier this week, Palm upped that number to 20 million shares at $16.25 a share.