Recent Palm Pixi price cuts seen as hurting Palm?

As we managed to report not too long ago, Sprint has gone ahead  and reduced the price in half of the Palm Pixi from its original cost of $99.99 to now $49.99 – it happened ominously on the same day when Palm cut its revenue target and raised profitability concerns. Although many will see the 50 percent drop in price as an attractive offer, it still doesn't beat the lower price that other retailers like Wal-Mart offers to customers who purchase the handset through them. Even before Sprint's cut, Verizon reduced the price of its Palm Pixi Plus smartphone to $79.99 which boasts some improvements over the one offered by Sprint – this all points to the unusual move by mobile operators when they quickly reduce prices so soon after launch. CL King analyst, Lawrence Harris, said that “Inevitably this will hurt Palm's profits.  If it's not in the February quarter, it'll be in May.” BMO Capital Markets analyst Tim Long also questions Palm's outlook in the coming months as wireless providers appear to already have problems getting rid of Palm inventory. Palm of course partly blamed the poor marketing of its Verizon Wireless phones and has recently launched a new campaign known as Project JumpStart to aid Verizon employees in sales of its products. Despite all of their new plan changes, analysts still view it as not enough and that Palm will need to offer new phones with bigger screens and keyboards than what the Pre and Pixi offer. When you look at it, the Palm Pre has been on the market since last June and is quickly approaching its one year mark – possibly signaling the onset of a successor in the coming months.

Palm Pixi Specifications | Review

source: Reuters