Palm Pre Customers Apparently as Constrained as Palm Pre Supply [Updated]
by John Paczkowski
Posted on July 24, 2009 at 10:40 AM PT
“We still have a backlog of subscribers but it’s not unmanageable and we get shipments every week. We’ll be short for a while but we’re catching up.”
[This post was updated at 12:36 with comment from Sprint.]
Sprint best step up its marketing efforts for the Pre because according to Pali Research, demand for Palm’s new device is slowing, and quickly.
During the week ending June 26, Pali estimates that Sprint sold 50,000-60,000 Pre handsets. In the weeks that followed, Sprint sold “less than 40,000,” and then, “over 30,000”–again, according to Pali. Now the research outfit says Pre sales have declined by another 5,000 units.
“We really aren’t sure what Sprint is waiting for in stepping up the ad campaign but Palm Pre sales have continued to slow over the past two weeks and we believe Sprint is currently selling roughly 25,000 per week, down from over 30,000 two weeks ago and over 50,000 in late June,” Pali analyst Walter Piecyk said in a research note this morning. “Advertising could increase in the coming weeks but we are headed into August and there is a new BlackBerry now vying for the attention of wireless customers.”
And don’t forget that $99 Apple iPhone 3G.
Piecyk concludes by suggesting that Sprint (S), by failing to market the hell out of the Pre, is fumbling the best opportunity to come its way in a while.
“Slowing sales cannot be helping CEO Dan Hesse’s ability to extend the exclusive period for the Pre as Palm (PALM) likely views a Verizon launch as something that could materially stimulate sales,” Piecyk said.
“Hesse has never been one to resort to price cuts but we wonder if dropping the Pre to $99 could reignite sales,” the analyst continued. “…Sprint’s future is certainly not tied to the Pre but this is a great product that could highlight their data network. We believe they are squandering this opportunity over the past few weeks. Sprint is still not in a strong enough position to let good opportunities pass them by.”
And what does Sprint think of that assessment? Not much. Reached for comment, a spokesperson told me: “we are very pleased with the performance of the Pre and the excitement it’s drawn; we are selling all the quantities that are being delivered to us and we are ramping up advertising this month — did you see the full-page ads this week comparing the value and performance of the Pre to the iPhone? — and we are expanding availability of the handset at Best Buy, Radio Shack and online, with future expansion of availability planned. As Dan Hesse noted in California today, it takes a number of months — through a whole ramped-up sales cycle — to determine the real performance of a handset in the marketplace. Folks like to speculate and toss around ideas on the internet all the time, but the truth is Sprint is very happy with how the Pre is doing.”
Comments
Sprint just sent me a dunning notice for $14 for service that I terminated in February, threatening that if I don’t pay it they will… terminate my service.
I have friends with a small business that have been fighting Sprinte/Nextel billing issues for two years, getting errors corrected by phone, only to have the same issue show up again next month… with interest charges.
The only thing dumber than Apple doing an exclusive deal with AT$T is Palm doing likewise with Sprint.
In this last case though, the Sprint/Palm lash-up is like throwing an anvil to a drowning man with a lead suit.
Posted by Mac Beach at July 24th, 2009 at 11:17 amIt’s ironic that the Palm Pre’s poor sales are being reported today, the first day since the
Posted by Michael Wilson at July 24th, 2009 at 11:55 amPalm Pre was re-patched so it could access iTunes again (Source:
MarketNewsVideo.com). Of course, after the bad press that I’d imagine came out after the Pre was first disconnected from iTunes, I suppose it would be hard for Palm to recover any good image it has lost with a mere software patch.
@Mac:
The only thing worse than the AT&T data plan hosejob is Sprint’s bad billing service…
No wait, the only thing worse than Sprint’s bad service is Verizon’s anti-customer hardware locking and walled-garden instincts.
No wait, the only thing worse than *that* is T-Mobile’s lousy coverage…
You see where I’m going, I’m sure. It’s rock-paper-scissors amongst the carriers.
@Michael:
To me it is entirely unclear whether Palm or Apple are going to end up looking the worst. So far, the spitball fight is a draw IMHO.
Disclosure: I am a satisfied Pre customer, who dropped both my iPod and iTunes itself right away.
Posted by David Gorgen at July 24th, 2009 at 1:10 pm