Economy and Palm Pre Sales: iPhone launch was a different market

Not so long ago Palm Inc (PALM) was in a bit of trouble, most of which was caused by its aging handset line. However; so far this year, Palm’s stock has doubled over the buzz of its new handset, the Pre. Things might not go as well as Palm hopes though, as it is thought that the Pre will sell less than half the number of units than the Apple (APPL) iPhone did on its launch.

Bloomberg has been looking into the launch of the iPhone and the upcoming launch of the Pre, and studying the differences. 10 analysts surveyed by Bloomberg estimate that Palm could shift 2.6 million Pre handsets in its first year.

If we go back to the launch of the first iPhone back in 2007, Apple managed to shift 6.1 million handset in the year after. Today is a very different story, as consumer spending has hit an all time low as a result; we are in the worst economic slump in a quarter-century.

Palm sales fell by almost 71 percent in the last quarter, which is not a great time to be launching a phone that is meant to take on the iPhone. The other problem that Palm is facing is the fact that they do not have the base of Apple devotees, and they cannot even draw from the corporate world as RIM (RIMM) can with its BlackBerry range.

There is also another factor that could prove a problem, Palm Pre’s buzz is starting to drop, a result of the upcoming Apple’s iPhone 3.0 OS.