Palm drops corporate market while failing to win over consumers

Despite much media hype the Palm Pre has failed to turn around Palm, who has continued to lose money.  Announcing its quarterly results yesterday, the company announced a $164.5 million loss, a 300% increase compared to the $41.9 million loss for the quarter previously.

The loss was on the back of the sale of 823,000 smartphones, mostly Palm Pre’s, which continue to lose the company money.  The smartphone has failed to maintain its initial $199 price point, dropping to $149 a mere 2 months after its launch, with rumours of a $99 price point already circulating. Sales of the JavaScript based device has also failed to improve Palm’s sales over its already dismal performance last year, with sales 25% less than the 1029000 sold in the corresponding quarter last year.

Despite the poor performance of the much hyped handset Palm has announced its intention to discontinue its higher margin Windows Mobile-based cooperate line, saying it will concentrate on developing its WebOS devices.

With Palm under pressure from many sides in the consumer market, with Motorola set to launch its own social network based device on Sprint soon, Palm’s reliance on the cheap consumer market may again be its undoing.