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Palm's Comeback Starts With Pre, WebOS

The handset and operating system look impressive, but the company is facing many challenges if it wants to grab consumers from Apple, Google, Nokia, and Research In Motion.

Palm 'Pre' Smartphone

Palm 'Pre' Smartphone
(click for larger image)

A few years ago, Palm was the unquestioned leader in the U.S. smartphone and PDA market. But it has failed to keep deliver devices that consumers lusted after, and it has been rapidly losing customers and has posted six consecutive quarterly losses.

Palm's unveiling of its Pre smartphone and WebOS at CES on Thursday gives the company a decent shot at taking back customers who have flocked to Research In Motion's BlackBerry smartphones and Apple's iPhone 3G. The comeback trail will be tough, though, as the marketplace is wildly different from when Palm dominated it.

Once the domain of early adopters and business professionals, smartphones have now become a mainstream product. The space has strong entrenched players like RIM and Apple, and up-and-coming newcomers looking to capitalize on Google's Android operating system. To make matters worse for Palm, LG and Nokia are making hard pushes for the U.S. market as well.

The smartphone market is still somewhat divided between enterprise smartphone users and the casual user, but that line is rapidly disappearing. Palm said it wanted to go after the "fat middle" of the market between the business-centric BlackBerry and the media-centric iPhone.

"We think it's perfectly balanced," said Palm CEO Ed Colligan during the handset's unveiling. "It's not just for work, it's not just for play. ... We think it's the one phone you can use for your entire life."

In terms of design, the Pre should be an appealing device to consumers. The 3.1-inch touch screen has a sharp resolution and it has multitouch and gesture-based navigation like the iPhone. The Pre takes gesture control a step further by including an area under the screen to let users quickly perform a few actions in any application with a swipe of the finger.

There's also a slide-down physical keyboard that curves forward slightly, and it should make mobile professionals and rapid-fire text message users happy. Including the touch screen and a physical keyboard does have its price though, as the Pre is a bit thicker than Apple's smartphone and the touch-screen BlackBerry Storm. Additionally, some may be bothered that there's no on-screen virtual keyboard.

In terms of features, the Pre has nearly everything one expects from a high-end smartphone, including Wi-Fi, 3G, Bluetooth, full HTML browser, 3-megapixel camera, the ability to add applications, 8 GB of storage, multimedia capabilities, and a high-end processor from Texas Instruments. It doesn't blow the competition out of the water with its specs, but it is a highly capable smartphone that isn't out-classed by its rivals.

But most high-end smartphones share similar set of features anyways, and there's an increasingly important emphasis of the software. Palm's WebOS has been in the works in various iterations for more than four years, and the company believes that extra time allowed it to create the right OS for a modern mobile user.

Palm's WebOS has been built from the ground up with constant mobile Internet connectivity in mind. Palm's OS pulls information from various Web services and aggregates it into a single, finger-friendly interface. For example, it will be able to aggregate contact information from Microsoft's Outlook, Web-based e-mail, and social networking site into a single contact list. The Outlook integration could make this a useful device for mobile professionals, and hands-on reports said it handles multitasking well.

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