Palm Pre Needs Strong App Store To Stand A Chance

Sprint confirmed earlier this week that the Palm Pre would land in stores June 6 and retail for $299 with a two-year service agreement, or $199 after a mail-in rebate. That particular date just happens to be the 65th anniversary of D-Day. And both Sprint and Palm are facing the daunting challenge of establishing a beachhead on turf that Apple and Research In Motion plan to defend vigorously.

Unfortunately for Sprint and Palm, Apple is widely expected to unveil a new version of the iPhone and significant upgrades to the smartphone's OS at its World Wide Developers Conference, which kicks off June 8.

But there's a new wrinkle in the smartphone market. According to a report released from research firm Gartner, the smartphone market is growing, taking a bite out of the more traditional mobile phone market.

That news must be music to Palm's ears—growth means more customers adopting the technology, which could give it a chance against the vaunted BlackBerry and iPhone. Unfortunately, Roberta Cozza, principal analyst at Gartner, points to very specific reasons for smartphone adoption and the coinciding uptick in Apple and RIM's market share.

"Much of the smartphone growth during the first quarter of 2009 was driven by touch-screen products, both in midtier and high-end devices," Cozza said in a statement. "'Touch for the sake of touch' was enough of a driver in the midtier space, but tighter integration with applications and services around music, mobile e-mail and Internet browsing made the difference at the high end of the market."

The Palm Pre will be equipped with both a touch screen and physical keyboard, providing a mix of options and cribbing specs from both the BlackBerry and iPhone. But the bit about "tighter integration of applications and services" should be worrisome to Palm.

It's clear that Apple has a mature application and services strategy. The Apple App Store, in fact, has driven competitors like RIM to launch the BlackBerry App World and Google to launch the Android Marketplace.

The Palm Pre's app store has been named the Palm Apps Catalog. But right now there has to be uncertainty surrounding the it. While Apple may have strict approval processes for the App Store, it is at least a known entity. App World has been in existence a few months now and is progressing, same for the Android Marketplace.

So why would a developer bet on the unknown? And more to the point, Palm is going to have to quickly convince customers that its App Catalog will be populated with applications that are going to be compelling to both users and developers.

As Gartner points out, customers want applications. And without them, the Palm Pre's battle against Apple, BlackBerry and the G1 might be just as difficult as establishing a foothold in France was 65 years ago.