A new hero?: Palm Pre’s tenure as top dog at Sprint Nextel could be short lived

Palm Inc.’s Pre has been a qualified success for both Palm and its exclusive launch partner Sprint Nextel Corp. (I say “qualified” because as the phone has sold in the hundreds of thousands and been lauded with glowing reviews, it has been overshadowed by the millions of iPhone 3GS’ sold by rivals Apple Inc. and exclusive partner AT&T Mobility.) However, the Pre’s reign as the “it” handset at Sprint Nextel could be coming to an end as the carrier is set to launch its first Android-based device next month in HTC Corp.’s Hero.
Sprint Nextel announced late last week that it would launch the Hero on Oct. 11 at the fully-subsidized price of $180. The Hero is schedule to be the carrier’s first Android-powered device nearly two years after signing on as an initial supporter of the Google Inc.-developed platform.
The pricing currently undercuts the Pre’s $200 price tag and adds such features as a larger display for its fully-touch screen operation, a 5-megapixel camera and integration with Google’s bevy of applications. The Pre does include a slide-out QWERTY keyboard to go along with its 3-megapixel camera, and its WebOS platform relies on Google’s e-mail, contact and calendar features to integrate content with the device. Both devices share support for Sprint Nextel’s CDMA2000 1x EV-DO Revision A network and Wi-Fi radio access.
In a spec sheet accompanying the Hero announcement Sprint Nextel compares the Hero’s feature set with those from the iPhone 3GS, T-Mobile USA Inc.’s recently launched HTC MyTouch 3G and Verizon Wireless’ BlackBerry Storm. Not surprisingly the Hero comes out quite well in the comparison. However, when compared with the Pre, the Hero’s advantages are as striking. In addition to the previously mentioned screen and camera advantages, the Hero boasts access to Androids’ extensive application store that includes more than 8,000 apps and expandable memory up to 32 gigabytes compared with the Pre’s embedded and locked 8 GB of memory.
There is also the subject of the pricing differences between the two devices. While the $20 may not seem like much, in today’s current economic malaise it could mean the difference in the mind of consumers. That pricing difference could be short lived as Sprint Nextel’s exclusivity on the Pre is expected to run out in January when Verizon Wireless has said it plans to launch the device, which could mark a good time for Sprint Nextel to cut its price on the phone. (Rumors also have the Hero launching at Verizon Wireless on the same day Sprint Nextel plans to launch.)
Investors did not appear concerned about the pending battle for device supremacy at Sprint Nextel as Palm’s stock was up in early Tuesday trading. However, as the Oct. 11 launch of the Hero draws nearer, look for some concern at Palm as its halo product is challenged.
Moto on deck
With HTC set to launch additional Android-powered devices with major carriers, Motorola Inc. is scheduled to announce its first Android device later this week. The beleaguered carrier, still looking to find its post Razr-legs, has a press gathering scheduled for Sept. 10 where it will unveil the device and hopefully a carrier partner.
Motorola has had a long history with Google as it was one of the first handset manufacturers to strike a deal with the Internet search giant to integrate access to content from Motorola handsets.
Motorola’s Android device is seen by many as a very important product for the company, which has seen its product portfolio age at an alarming clip and lack a compelling offering in the hotly-contested smartphone market.