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Palm cutting staff, overstocking the Pre?

updated 11:55 am EDT, Wed September 30, 2009

Palm may be cutting jobs

Palm is engaging in a fresh round of job cuts due to disappointing sales of the Pre, according to a pair of assertions made today. One tip has the smartphone creator laying off some staff within the US. Numbers and the particular divisions affected aren't mentioned by CoolSmartphone; the move is only known to be prompted by "restructuring."

One analysis issued today suggests that the cuts may be necessary given not just Palm's wider losses but also a possible masking of actual Pre sales numbers. As the company's recent 10K filing with the Securities and Exchange Commission only counts deliveries to Sprint as sales rather than sales through partners like Best Buy and Radio Shack, it's suspected by TheStreet that a reported 13,000-phone increase in inventory doesn't reflect a much larger glut of phones left unsold the channel. Palm is estimated to have actually sold about 375,000 Pres but to have as many as 275,000 phones still in stores, or enough to last it for another 11 weeks. Apple by comparison often has only about four weeks.

The poor sales are attributed to two of the most commonly cited problems with the Pre's availability on launch. Its $200 contract price was considered high in June and was cut to $150 just over three months later, not including third-party discounts that have brought the phone to as low as $80 at Walmart. Also, Palm's now almost exclusive dependence on Sprint in the US may be a liability as it not only limits the reach of its phones but could lose a bargaining chip when trying to negotiate a fair price from Verizon or other carriers.

By Electronista Staff
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  1. climacs

    Mac Enthusiast

    Joined: Sep 2001


    didn't see that one coming

    if you're not getting share in the smartphone market, you're doomed to be an also-ran.

    Motorola = FAIL
    Palm = soon-to-be FAIL

    Nokia will probably hang around for the indefinite future because they sell a lot of cheap phones in markets which can't support widespread smartphone adoption

  1. iphonerulez

    Dedicated MacNNer

    Joined: Nov 2008


    The Pre is losing sales...?

    Who would have thought that possible as it was considered the next contender for the iPhone crown of glory.

  1. bearcatrp

    Senior User

    Joined: Dec 2005


    Yeah, they really blew it with the pre

    The pre looked promising. I was holding out for one but couldn't wait and got a BB. Glad I didn't get one. The web OS needs more work but they have to do better with the phone that works very well and not this cheap plastic c***.

  1. Fast iBook

    Fresh-Faced Recruit

    Joined: Mar 2003


    I knew it.

    I reviewed the specs the 1st day they were released. Unimpressed i relaxed in my chair while sipping hot cocoa & using apps on my iPhone. :)

    - A

  1. charlituna

    Fresh-Faced Recruit

    Joined: Sep 2009


    first guy fired

    is the one that made the decision to just hack itunes instead of making their own software

    second guy fired.

    is the one that couldn't make a hack that Apple couldn't break

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