Does it make sense for Nokia to buy Palm?

Should one company that has trouble selling smartphones buy another?

A rumor that Nokia might purchase Palm shot the troubled smartphone company's shares up on Friday and reignited the debate: What should happen to Palm?

For the moment, nothing. With a $1.7 billion market cap, Palm seems awful pricey. It is hard to imagine anyone making such a huge investment for a company whose gloss is so rapidly wearing away.

On that basis, until something happens to lower that market cap--I think time will take care of it--Palm will remain independent.

Once the price goes down, Palm will have proven itself to be in such trouble that it may not be worth buying. Too expensive now could translate into not worth enough later. This is especially true if potential purchasers make smartphone progress in the meantime.

In that regard, Nokia needs to do something to make a real play in smartphones, but rumor aside, Palm is not it. Nokia already has its own smartphone OS, a Linux variant called Mameo, and could always head in the Android direction once it gives up on the idea of owning a smartphone ecosystem.

Nokia's new Mameo-based N900 may also be a better smartphone than the Palm Pre, another reason Nokia may want to continue on its own. However, there remains the annoying problem of generating developer interest, something Palm also lacks.

The biggest thing that speaks against Nokia buying Palm, besides the price, is the cost of integrating the two companies. Nokia is probably better off building Android phones for its high-end product while it tries to do a successful smartphone OS of its own.

Nokia will live to regret its inability to master smartphones before Apple and Google did. However, by not buying Palm it will be saving a boatload of money. Why add injury to insult?

A Palm buyout by Research In Motion is another possibility. RIM has faced problems turning its BlackBerry products into a family of smartphones. Its corporate customers have, however, been very understanding, thus giving the company breathing room.

Smartphones have been slow to catch-on in business, where integration with Microsoft Exchange technology often drives a purchase decision. BlackBerry remains the nearly universal corporate standard.

This also plays to RIM's benefit and against newcomers like the Droid. Apple seems to have only a passing interest in corporate purchasers.

You could reel off names of other potential Palm purchasers, a group that might include Samsung, Microsoft, Dell, and others. None of them, however, has a compelling reason to invest.

It is possible to imagine a company that has been successful in other consumer electronics or business products buying Palm as a way to get into the business. It is, however, much harder to imagine a company that loony.

If Nokia--or anyone else--is really considering a Palm buyout, they should think again.

David Coursey tweets as @techinciter and can be contacted via his Web site.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags Palmmobile phonesNokia

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

David Coursey

PC World (US online)
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?