Palm Prunes Pre Pricing

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In a bid to pump up stagnant sales Palm is expected to pare down the price of the Palm Pre smartphone by about $50.

Starting today, Palm is expected to sell the Pre for $150 after a mail-in rebate, a special pricing model that will run through Oct. 31, according to a report by Pre Central citing a tipster from one of Sprint's retail partners.

The Palm Pre price pruning comes as Sprint aligns itself with the Google Android-based HTC Hero, the carrier's first device to offer the open-source Android mobile operating system. The HTC Hero is expected to run $179.99 with a two-year agreement when it launches next month, while the Palm Pre still costs the same $199.99 that it did during its June launch.

The $50 Palm Pre discount is expected to only be offered by Sprint's "indirect retail channels" like Best Buy and Radio Shack, aka The Shack, meaning the rebate won't be offered at Sprint Stores or via, Pre Central reported.

A Pre price cut would also help Palm better compete with its archnemesis, the Apple iPhone 3G S. The two devices hit stores within days of each other, sparking a new clash of the touch-screen titans. The Apple iPhone 3G S quickly clobbered the Palm Pre in sales, selling more than 1 million smartphones in its first week alone while estimates indicate that the Palm Pre won't sell anywhere near Sprint's projected 1 million to 1.5 million units for the year, according to a report from Barron's.

The $50 price reduction will also help Sprint better compete with rival carriers. Along with AT&T offering the Apple iPhone, other major carriers like T-Mobile have launched devices in the $200 range like the Google Android-based T-Mobile myTouch 3G. A $50 drop for the Pre could give it a slight edge.

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