Palm forced to cut Pre launch numbers?
updated 08:00 am EDT, Fri May 1, 2009
Palm May Cut Pre Launch
Analyst Ashok Kumar of financial group Collins Stewart has said that Palm has had to significantly scale back its build numbers for the Pre. In an investment note obtained by All Things D, Kumar claims to have access to Palm's supply chain and hears that "multiple hardware and software issues" have forced the company to scale back its production to match. The cuts are steep enough that the researcher doesn't see Palm shipping 1 million Pre phones in the second half of 2009.
The Collins Stewart analyst also echoes conservative views of Palm's chances with Sprint, arguing that it's "highly unlikely" customers will drop AT&T or Verizon to get the Pre while customers themselves have been leaving Sprint over customer support concerns. Kumar also believes the Pre is "DOA" if the price goes significantly above the $199 subsidized price asked for the iPhone 3G.
Whether or not Kumar is accurate is still uncertain; several other analysts predict that Palm may deliver as many as 375,000 first-wave units and that this may sell out by itself. Rumors have also circulated that the first devices may already be in the US.
A preliminary cost analysis has put the pure manufacturing price of the Pre at just $138 before royalties and other costs and hints that a $199 or lower contract price is likely for the Pre.
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bury both of them
Sprint and Palm, a match made in h***.