Palm may have sold up to 100,000 Pres in first weekend

Palm, Sprint won't say, but analyst estimates customers bought 50k to 100k of the smartphones

As many as 100,000 Palm Pre smartphones may have been sold since the device went on sale Saturday, one industry analyst estimated today.

The launch was widely considered a soft launch, with a limited number of devices in stock at Sprint Nextel Inc. outlets and at Best Buy and other stores. Palm Inc.'s new smartphone, described by one industry observer as an "iPhone Jr.," was highly anticipated and attracted lines of customers at stores in the first few hours of sales. The device has a price tag of $200 after a $100 mail-in rebate, plus a two-year service agreement with Sprint, which has an exclusive contract with Palm to offer service for the Pre.

Based on the fact that there were widespread reports of lines of shoppers waiting for a limited supply of Pres at a fairly wide range of retailers, Kevin Burden, an analyst at ABI Research Inc., said he believed that Pre sales "are where they should be." He estimated sales to be between 50,000 and 100,000 units for the first weekend.

"Did they sell 80,000 or 100,000 -- who knows? But it's got to be somewhere between 50,000 and 100,000," Burden said.

Sprint issued a statement late today saying the Palm Pre broke first weekend sales records for a Sprint device, but did not release any numbers.

A surprise to many analysts and Palm fans was that the Pre was designed to synchronize with the iTunes music player from Apple Inc. When the feature was announced last week, some called the move a hack by Palm of a competitor's software.

But one prominent analyst, Ken Dulaney at Gartner Inc., said today that Palm is working with Apple on this sync capability, partly because Palm's executive chairman, Jon Rubinstein, once worked at Apple.

Apple would also get too much criticism if it prevented an iTunes sync, Dulaney said in an e-mail. "If Apple pulled the plug after committing to it, they would probably get hugely negative publicity," Dulaney said. "They won't do that, I am betting."

Noting that Rubinstein worked for Apple, Dulaney added, "He knows them. I am sure the deal is worked out. After all, this [Pre] is the iPhone Jr."

Apple and Palm couldn't be reached for comment on the sync feature today, but Rubinstein said in a statement that iTunes sync was designed as an "easy and elegant way" for Pre users to access the music they own on iTunes.

Burden said the sync feature might have been done with Apple's consent as a way to bolster features in the Pre. At launch, only a dozen applications were available in Palm's application store, called the App Catalog. "Maybe the iTunes sync is not a long-term application and just for the launch," Burden said.

There are many other lesser-known music players on the market that Pre owners could use if they couldn't use their Pres, he said.

Ultimately, Palm's success will lie in its ability to get more developer apps into its online store, Burden said.

On its blog today, Palm announced another dozen applications, including ones called uLocate, FlightView and Citysearch.

The company said 150,000 apps were downloaded from the beta version of the App Catalog on the first day the Pre was available.

There are about 50,000 iPhone and the iPod Touch applications on Apple's App Store, and they have generated more than 1 billion downloads since the App Store launched about a year ago. Today, Apple announced more applications that will work on its faster iPhone 3GS.

Copyright © 2009 IDG Communications, Inc.

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