rattyuk - 21 March 2010 07:06 PM

Roman - 21 March 2010 04:36 PM

So all in all, I’m not wishing that Apple buy Palm, certainly not at the current price. I also agree with Eric that it would knock AAPL down immediately.

The question is “would HTC or Google buying it knock Apple further?”

I don’t see it as knocking Apple at all. It’s an OS for better or worse (and no matter the reasons) that hasn’t gained traction with consumers and development resources would be high to keep the OS current.

I don’t know what happened following signing of the Verizon deal and whether or not Verizon insisted on high shipments or if Palm pushed too hard to move product into the market.

There’s rapidly depreciating product in the channel that may or not eventually be sold and there isn’t a market to license the OS to other handset makers. What’s the value of the acquisition?

Just read an interesting comment on this topic at Jean Louis Gassée’s blog. Unfortunately there seems to be a problem posting the exact link at the moment. The link should go to Gassée’s post called “Who will buy Palm”. If we can sort this, the link will be here. if not its at www dot mondaynote dot com forward slash 2010 forward slash 03 forward slash 21 forward slash who-will-buy-palm

relentlessFocus - 22 March 2010 02:01 PM

Just read an interesting comment on this topic at Jean Louis Gassée’s blog. Unfortunately there seems to be a problem posting the exact link at the moment. The link should go to Gassée’s post called “Who will buy Palm”. If we can sort this, the link will be here. if not its at www dot mondaynote dot com forward slash 2010 forward slash 03 forward slash 21 forward slash who-will-buy-palm

calmdownFocus, this is the link you look for

ghobi - 22 March 2010 02:19 PM

[quote}
calmdownFocus, this is the link you look for

Well I wasn’t having a problem “looking for” the link, but every time I tried to make my post with it I’d get a TMO web site message saying the link was blacklisted. Glad its working now.

artman1033 - 22 March 2010 03:15 PM

relentlessFocus - 22 March 2010 02:47 PM

ghobi - 22 March 2010 02:19 PM

[quote}
calmdownFocus, this is the link you look for

Well I wasn’t having a problem “looking for” the link, but every time I tried to make my post with it I’d get a TMO web site message saying the link was blacklisted. Glad its working now.

In the future try THIS!

IT explains the tiny url above link.

Thanks artman, that clears matters up. Before posting I had written a PM to DawnTreader asking his suggestion on how to handle the blacklist problem and he suggested that I try the method that I tried. He said he’d check through the blacklisted sites in the meantime. Perhaps he did or perhaps he added it to the whitelist which then allowed ghobi to post the link.  Haven’t had a chance to get back to Robert as I only seem to be able to make one PM/day. Oh the trials and travails of a newbie…

Cheers
Eric

Thanks for the welcome artman… it’s nice to find an Apple forum related specifically to Apple financials. I hope to learn a lot and hopefully contribute a bit myself.

I’m experienced with forums and posting forms but I never came across a blacklist message like the one I got today. So the first thing I did was look through all the links on TMO looking for something resembling help or posting info. Not finding any I looked for an administrator’s name and saw DawnTreader was listed as administrator so PM’d him. I’m not sure if my/our experience is relatively unique and thus an outlier or if others have had a problem. Anyway, I feel a lot better now that you’ve explained the situation.

And now back to the thread…

artman1033 - 22 March 2010 04:16 PM

Welcome Relentless!

I did post THIS, but I am STILL WAITING!

Wow, artman, this would be good. I never saw that post. Personally, I just started posting after 2 years of reading AFB, hopefully enough preparation to avoid most blunders.

Back to the topic - the article that relentless linked to is good. However, JLG glosses over Palm’s assets (e.g. IP portfolio), and there’s also the fact that it can be a political/posturing move on the part of the acquirer. I think someone somehow will buy the remainder, but probably at a lower price. One other part of the company that hasn’t been considered much is their hardware capability. For Google or Microsoft, this could be relevant.

relentlessFocus, the article was a good find. The issues relating to sales are well known. What this brought to light were issues involving any borrowing covenants.

The only “buyer” I see is Elevation Partners and I’m not sure what they would do with the company if it were wholly owned.

I have a question.  What IP portfolio?

After reading a bizillion references to Palm’s valuable IP portfolio, I have yet to see it described.  There are some statements floating around based upon imputed value, like “Palm was a pioneer in PDAs”.  But never have I seen anything approaching a description of what they have that is so valuable.  I suppose it must exist; where there is smoke, there is fire and all that.

This was something I worried about last summer when I shorted Palm.  Finally decided to risk it.

Separately: Palm has about $2 of long term debt per common share.  Another number to factor into any potential purchase price.

capablanca - 22 March 2010 11:42 PM

I have a question.  What IP portfolio?

Engadget’s Nilay Patel took a look about a year and a bit ago. you can read the article here but I will quote bits without the graphics in this response. The first part of the article covers what Apple brought to the table… The second part covers Palm:

Palm’s patent portfolio

In all the rush to portray Apple as the big bad wolf, people seem to have forgotten that Palm is a comeback story—it’s been in the game since 1992, and it’s got a pretty hefty patent portfolio of its own. Take #7,268,775, entitled “Dynamic brightness range for portable computer displays based on ambient conditions,” for example—it covers automatically adjusting display brightness using an ambient light sensor while leaving a user-selected brightness setting alone. Yep, that’s exactly how the iPhone does it:

Or how about #7,007,239, “Method and apparatus for accessing a contacts database and telephone services”? Claim 10 is an almost exact description of the iPhone’s phone app—buttons for dialing, call history, contacts, and speed dial that stay on-screen as you toggle between them:

Not only that, but it covers pulling up contacts by just typing in initials, which is totally in the iPhone:

Or how about #7,296,107, “System and method for detection of an accessory device connection status”? It covers leaving the display at full brightness instead of auto-dimming while connected to a power source during sync—go ahead and try it, iPhone owners, that’s what it does. And let’s not forget 2001’s greatest hit, patent #7,231,208, “User interface-technique for managing an active call”: it describes in detail a conference call management system that’s exactly like the iPhone’s—you put one call on hold while you make another, and then you can independently manage each call from a single screen. Look familiar?

If you’re going to say that the Pre crosses the boundaries of Apple’s spring-back edge scrolling patent, you’re really not in a position to say that the iPhone doesn’t similarly ape Palm’s call-management patent—or the brightness patent, or the contacts patent, or the dim-during-sync patent, or… you get the idea. Apple might be the more infamous IP juggernaut, but Palm has literally hundreds of patents of its own, and we managed to dig up four that seem to directly implicate the iPhone in just a few hours of searching. Imagine what Palm’s lawyers could do, armed with their actual knowledge of what Palm owns and the motivation of some serious hourly fees.

Speaking of tidy sums, we haven’t even begun to talk about the money involved here, and it’s a lot—enough to seriously tip the scales. Let’s say Palm were to win: not only might Apple lose its patents, the court would at the very least award Palm royalties for the patents the iPhone infringes, and at over 16m iPhones sold so far, even a few percentage points adds up fast—we’re talking hundreds of millions of dollars. If Apple wins? Well, Palm hasn’t sold any Pres yet, so its exposure to royalty payments is much lower—and potentially losing some older patents it may or may not even be using doesn’t seem like a terrible punishment. Then again, if Palm loses, it probably won’t be able to ship the Pre on time or as promised, and that could well be the end of Palm.

What both sides could do is tweak their pending patent applications to more accurately describe their competitors’ products and then try to sue based on those—it’s actually considered good practice for tech companies to always have patents pending, so they can try and cut their competitors off. For example, Apple has a second patent identical to the “iPhone patent” filed with the patent office that it can certainly slightly revise to try and loop in the Pre’s scrolling behavior. Not only that, but Apple also has tons of pending patent applications on multitouch that haven’t really gone anywhere since they’ve been filed, like this one that purports to flatly cover all capacitive multitouch surfaces. Will it ever get granted? Who knows—but it’s certainly another card Apple can try to keep in its back pocket.

Since a patent covers an implementation of an idea and not the idea itself (correct me if I’m wrong), if Apple or Palm has a patent on some implementation of an idea the patent is only infringed if another company tries using the same or substantially the same physical technique as the first to perform the action.

What we lay people can’t easily assess is how critical a specific patented technique is to accomplish the desired result. Therefore, I think its very hard for us to assess how important a particular patent or patent portfolio is because most of us are not engineers familiar with the engineering problems involved. It may well be that Apple has assessed Palm’s portfolio and given the advances in technology decided that the patents are no longer critical for accomplishing the same end results.

A patent is valuable to the extent it can generate revenue through the creation of desired goods. I don’t see buyers lining up at the door and the lack of sales to date for the handsets may indicate the market has spoken about the value of the portfolio.

Thanks, ratty.  I am embarrassed I did not see this when I was looking last summer.

As Relentless points out, hard, even impossible, for me to assess.  But its unlikely any of these would have scared me off shorting Palm.  Auto-dimming dashboards on autos have been with us for what, 20 years.  BTW, I hate the damn things.  Call me a Luddite, but I rue the day that they started putting computers in cars.

P.S.  I am also embarrassed that I covered at 6 and change.  (fear of takeover)