ckrupsha
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Registered: Oct 2000
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Posts: 34 |
 Back to the original Q
What is going on with the edge is simply market forces.
First there is an economic slowdown...
Then Palm bungles the release of the M50x series. Everyon stops buying Palm's other products to wait the 6-8weeks for the M50x. Palm had to start deep discounting to clear excess inventory to a) sell product at all, b) keep their supplier chain happy by moving out the older products to replace with the new.
THEN, Handera and more significantly, Sony release their latest generation of products which perform arguably better than anything Palm or Handspring has in a base unit. So the item that Palm was counting on to bring them back to profitability has some very stiff competition for the fewer PDA buyers in this market willing to pay for a high end device. If you can get past the form factor, the Sony is a far better device than the M505. So, Palm has to start dropping price on the M505 to keep their inventory turning over.
What does this mean for edge? ANyone willing and able to pay the full MSRP for edge is also able to do so for Handera, M505, Clie700c. The last two units have compelling reasons to purchase them -- check em out if you haven't already. Edge has a great form factor, but lacks the color even though its MSRP is equivalent to the other two. If Handspring wants to keep turning inventory, they too will have to discount because the edge is arguably a slightly lesser product (just compare hardware features please, edge will come up short for the average user who may only purchase one springboard -- ROM software hardly counts since there are far better products available to all units). And remember, where Palm was profitable, and could easily be again; Handspring is not yet profitable. Everyone is talking doom and gloom for Palm, but I think Handspring's situation is slipping under the radar of most industry analysts.
ALthough it is generally accepted that Handspring had been moving in the right direction vis a vis profitability, this is not the economic environment Dubinsky had been counting on. Especially given Palm's inventory problems. In order to retain market share, let alone growth in market share Handspring must discount to match Palm. To compete for the same high end buyers as Palm/Sony, Handspring needs either a color product in Edge form, or powerful color unit a la Clie. However this would not be a good time to roll one out because they simply would not sell enough of them given the economy and competition. INtroducing this unit would drastically cut into sales of B/W edge and Prism -- of which there is a lot of inventory globally. A bloated product line would further delay the all important "becoming profitable."
So what is up with the edge? A tough marketplace.
Last edited by ckrupsha on 06-14-2001 at 08:43 PM
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06-10-2001 08:17 PM
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