Lyons: Will the Palm Pre Kill the iPhone?

Apple fanboys can breathe easy. The new Palm Pre smart phone has arrived, and while it's a terrific phone, it's no iPhone killer. But it does have some things that the iPhone lacks, like a physical keyboard. Its software and user interface are magical. And its multitouch screen is arguably better than the multitouch screen on the iPhone, which pioneered this technology. Despite all this, and despite what Palm's sugar-daddy investor, Roger McNamee, said a few months ago, not many people are going to race out and dump their iPhones in favor of the Pre. I know I won't.

But that whole question about being an iPhone killer is beside the point. Because the real audience that Palm is targeting is not people who already use an iPhone or a BlackBerry. Palm is targeting people who have never used a smart phone before, the holdouts who have shunned smart phones because they're too big or bulky or intimidating. On that front Palm, may score bigtime, at least based on my own highly informal market research—which is to say, I showed the Pre to my technophobic wife, who still defiantly carries a Motorola feature phone despite my many offers to get her something cooler. Her response surprised me. Instead of grumbling, she held the Pre adoringly in her hand and made that sound women make when they like something. "Hmmm," she said. "It's nice. I like it."

The Pre is the brainchild of Jon Rubinstein, a former top Apple engineer (he led development of the iPod) who joined Palm last year. Officially his title at Palm is "executive chairman," and you could think of him as the Steve Jobs of Palm, the somewhat benevolent dictator whose vision gets expressed in the product. Ruby, as he's known, has brought in loads of new talent to Palm, including a bunch of Apple veterans. And they're handling the rollout of the Pre much the way Apple does these things—loads of secrecy, limited access, everything designed to build as much hype and suspense as possible.

The Pre goes on sale this Saturday, June 6. Palm started giving out review units to reporters in the last few weeks, but everyone was forced to sign nondisclosure agreements and to agree not to write a word until today, June 4. Which means that today, right on plan, Palm gets a blitz of coverage. Gadget godfather Walt Mossberg of The Wall Street Journal says the Pre is "beautiful, innovative and versatile" and "potentially the strongest rival to the iPhone."

Mossberg's big rival, the always-chipper David Pogue of The New York Times, says "the Pre will be a hit, but the iPhone isn't going away," and he predicts Palm's recovery from a death spiral will have a "happy ending."

Henry Blodget, editor of Silicon Alley Insider, says the Pre will bomb, but may turn Palm into an "attractive acquisition candidate," perhaps for Nokia.

Gizmodo, the leading gadget blog, employs a painful poker metaphor and says the Pre is, "Respectable. Decent. Impressive even. But not the highest hand."

The biggest gripe from Gizmodo seems to be that when you slide open the Pre to use the keyboard, the plastic edges of the phone's body are too sharp—in fact the Gizmodo reviewer, Jason Chen, calls the plastic "irresponsibly sharp" and warns you: "prepare to get sliced." I can only tell you that I've been using the Pre for nearly a week and have yet to suffer any blood loss or severe slashes on my fingertips. Conclusion: Jason Chen is a whiny, girly handed wussboy. Sorry, dude. But it's true.

One thing everybody likes is that the Pre can sync up with iTunes running on a PC. The Pre does this by tricking iTunes into thinking the Pre is an iPod. I'm pretty sure Apple will find a way to mess this up by putting some Pre-breaker code into the next version of iTunes. (These two companies hate each other.) But still, it's a neat feature, and if Palm can keep it alive, it will be a big selling point. One of the biggest hassles of using anything other than an iPhone is that it's a real pain to get music onto the device.

Another cool thing is that the Pre comes with Sprint TV, which lets you watch live and on-demand television on your phone. It's fantastic. There are even premium channels, which you pay for, and which include soft-core porn. Yes, I looked. Why not? It's a review unit, so the premium channels were paid for. And it's all in the name of research. Sadly, the porn was not so great. But the video quality is stunning.

So in some ways Palm has leapt ahead of Apple. Bad news is, Apple is just about to introduce a new iPhone device plus an upgrade to its iPhone operating-system software. That could come as early as next week. And today's little hype explosion about the Pre will get buried beneath the Apple publicity steamroller. Which is too bad, because if this thing had been introduced two years ago, it would have been huge.

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