Palm recently got a $100m investment by private equity firm Elevation so they should be able to stay buoyant for now. Internet buzz will help, and presumably Sprint are going to be doing a lot of advertising for them and push the phone heavily.
I don't think they are competing with the iPhone as much as they are RIM, the biggest smartphone manufacturer in the US.
There are lots of innovations in there: good multitasking support, a proper application dock, and sync and communicate via multiple services being the obvious ones. But it benefits from looking like a good all-round phone when every other one out there has glaring flaws.
I think the other key benefit is that it actually looks like a phone. Smart Phone companies are all aiming for the 18-34 bracket, however there's a lot more people with a lot more money in the 35-65 bracket. My wife's uncle laughed at the iPhone, because without a keyboard it's completely useless and as a 20 year old writer I whole heartedly agree.
There's also an amazing thing called "word of mouth" which beats any other form of advertising ten-fold. I saw the demo and said "I want one", I showed my wife and she said "I want one!" There's a handful of people that if I showed I'd say there's a good 80% chance they would say they want one, all of whom don't have an iPhone.
See the funny thing with the iPhone is that it plays off the iPod gimmick. I'm not sure how long that momentum will last, before all the people who are whipped into thinking apple are amazing begin to ask questions. Apple has too much momentum and it'll have to spend a lot of energy keeping it up to keep people distracted from flaws. Palm however has virtually no momentum, it has no large vocal user base that it has to fear, aside from a few techies (like us) most people probably haven't even heard of Palm so it's like being a brand new player. No one knows they failed in the past, no one cares and as long as the Pre is as good as it looks in that demo then I give Palm an amazing chance as lead underdog.
I also think the Pre sits in a nice niche between iPhone and Blackberry, which will either make it huge or kill it completely depending on if it can steal customers or if it acts as a gateway drug to the iCrack/crackberry.
The physical keyboard note is laughable. Most iPhone users have no problems with it. I switched from a Blackberry to an iPhone and after a week of heavy keyboard use, I am now just as fast / error free.
I'm not sure exactly how the iPhone is playing off the "iPod gimmick" or what exactly the "iPod gimmick" is. The iPod is an established brand name and a very easy to use portable media player. The iPhone offers the same easy-to-use interface. Think back two years ago, and see what other smart phones were doing with media players...Blackerry's was an absolute joke, and not one of them had a halfway decent web browser.
In comes Apple and they fix most of the key issues. They made the mobile web useful and actually integrated phone and iPod into a single device. You can call that a gimmick all you want, but they were the first to do it properly. The App Store also addressed a major concern in mobile apps distribution. Since then, everyone is just copying what Apple has done and try to innovate in between. What we end up with is a poor attempt by RIM (Storm), a OS that falls behind the iPhone from Google (not to mention running on inferior hardware) and whatever trash is running on Windows Mobile.
I'm not saying that there isn't a market for the Pre, but it's market isn't going to be current iPhone users. I just don't see the Pre being a game changer at all for Apple. If they ever break exclusivity from AT&T, it's just going to get worse for the competition. There is too much momentum and not enough room for innovation.
We'll see what happens once it's released. I know one thing though...Apps are going to be the lifeblood of mobile devices in the future. If I'm an App developer and I only have one platform to release on, it's going to be the iPhone. Where will the Pre sit on this chain? I don't think it's going to be near the front.
Okay, how about I take your keyboard away, and lets see you type that on the on-screen keyboard utility's you get with Windows/OS X. Please, let me see you type an email message without a keyboard.
I agree, it's not completely useless. It's about 99.9% of the way there though.
I don't think they are competing with the iPhone as much as they are RIM, the biggest smartphone manufacturer in the US.
There are lots of innovations in there: good multitasking support, a proper application dock, and sync and communicate via multiple services being the obvious ones. But it benefits from looking like a good all-round phone when every other one out there has glaring flaws.