Palm, Inc.

» see palm.com as it lived, on the wayback machine

~ the obit ~

Palm Computing was founded in January 1992 to write handwriting recognition software for other companies' machines. That is the part usually left out of the story. It began as a supplier, and it only built hardware later because the machines it was writing for kept failing in the market and taking its software down with them. By the time it shipped the device people remember, the company had already been bought.

USRobotics acquired it in 1995. 3Com acquired USRobotics in June 1997, so a handheld computer business arrived inside a modem company as an item on somebody else's balance sheet. Jeff Hawkins and Donna Dubinsky left the following year to found Handspring, largely because 3Com would not let the unit run itself, and they went straight into competition with the thing they had built. Five years later Palm bought Handspring, which meant the founders came back in through an acquisition of their own company.

The ending was arranged in April 2010. HP announced on the 28th that it would pay $5.70 a share, about $1.2 billion, and the deal closed on 1 July. Palm stopped being a registrant that day and became the webOS Global Business Unit. On 18 August 2011 HP announced it was ending webOS device operations, which was forty nine days after the TouchPad had gone on sale. HP sold the operating system to LG in February 2013 and the patent portfolio to Qualcomm in January 2014. In October 2014 the trademark went to TCL through a shell company.

Turkey did not have a PDA decade. The devices arrived as imports at import pricing, there was no local retail channel worth the name, and what a professional in Ankara actually carried in 2003 was a Nokia. The country went from a paper agenda straight to a phone, with no stop in between, which is why the whole category reads here as something other people owned. The successor product was never in question, because the predecessor was never really here.

~ the rap sheet ~

~ the carve-out ~

3Com sold about five percent of Palm to the public on 2 March 2000 and kept the rest, promising to hand its own shareholders roughly 1.5 Palm shares for every 3Com share later in the year. The offer priced at $38. It opened at $150 and closed at $95.06, having touched $165 along the way.

Anyone holding a 3Com share was therefore holding a claim on about $145 of Palm. 3Com closed that day at $81.81. The market was pricing everything 3Com owned other than Palm at roughly negative sixty three dollars a share, which came to about minus twenty two billion dollars for a profitable networking company with cash in the bank.

This was not obscure. Two Wall Street Journal pieces and a New York Times piece explained it within a day, and it became the most cited single data point in the argument that the market of that spring was not pricing anything at all. Palm lost ninety percent of its value inside a year and was trading at $6.50 by June 2001.

~ the trademark years ~

In January 2002 the company put its operating system into a subsidiary called PalmSource so that other manufacturers could license it without buying from a competitor. In October 2003 the hardware half merged with Handspring and renamed itself palmOne, which left the Palm trademark jointly held by two separate public companies with adjacent names and a shared logo. It took until May 2005 and thirty million dollars for palmOne to buy out PalmSource's half, and in July 2005 it quietly became Palm, Inc. again under the old ticker.

~ what hp actually bought ~

The attraction was webOS, a genuinely good operating system built by a team that included former Apple engineers, and HP said at the time that it intended to put the thing on printers and eventually on every PC it shipped. The handsets were the means of acquiring it. Léo Apotheker became HP's chief executive five months after the deal closed, and on 18 August 2011 he announced the end of webOS devices and a possible exit from personal computers on the same afternoon. HP's shares fell twenty percent. He was gone by September.

webOS did survive, which is the strange coda. LG has shipped it on television sets since 2014 and it now runs on more screens than it ever ran on phones, under a brand that has nothing to do with California. The patents went to Qualcomm and are presumably still being asserted somewhere. What does not survive is the company, and the reason is that it spent eighteen years being owned rather than owning, which is a hard habit to break in a business where the winners were all founder-run.

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