In a long-ranging interview with CNN Money, Palm CEO Jon Rubinstein acknowledged the company has had some missteps but he remains confident in its ability to mount a comeback.
Of course, you’d expect any CEO of a public company to blow smoke up your backside when things aren’t going well. Make no mistake, things aren’t going well for Palm. The Pre and Pixi were supposed to be runaway successes that helped the company regained relevance but consumers ignored these handsets. Last quarter, the company shipped nearly a million handsets to carriers but only 408,000 were actually purchased by customers. So Jon, was it a mistake to launch exclusively with Sprint?
They were willing to invest significant marketing dollars. But the quid pro quo for that is that we had to do an exclusive with Sprint. Now, if I sit today and I kind of roll back the clock and go, okay, now if I could have launched to October with Verizon, and done shorter exclusive with Sprint, and the world would be completely different today, yeah, I mean, that’s easy to say. But you don’t know these things at the time. And Sprint has been a really good partner for Palm. They continue to be a really good partner for Palm.
He’s previously said he thinks the Pre Plus could have been as successful as the Droid if it had launched on Verizon first. I’m sick of this wishy washy “hindsight is 20/20” horse apples – everyone and their mom knew the exclusive deal with Sprint was going to be a weakness. I don’t blame Palm because it probably got the best upfront deal for handsets, but it traded short-term cash for long-term relevance. Even T-Mobile may have been a better choice because at least then it would have given Palm a jump start on its GSM-based European push.
Is it too late for Palm to push back to profitability? Rubinstein said the major issue is economies of scale, but the company is investing heavily in research and development, which will pay off down the road. He’s seen this type of situation before at Apple, Rubinstein said.
When I got to Apple the company was dying. We brought out the iMac, and the company was really successful, and then the economy cratered, and we went through a major dip, which took like two years to dig our way out of. And during that time period we invested very heavily in R&D and Wall Street was very unhappy with us, because the numbers looked ugly. But then when the economy turned, we had a bunch of really cool products ready to go, the iPod being one of them, and the company quickly scaled up to the point where the economics just made sense.
Hop on over with the via link to read the rest of the interview, it’s well worth your time.
[Via CNN Money]