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Analysts give thumbs up to Dell buying Palm

Not that anyone is thinking of it
Tue Mar 24 2009, 14:49

Palm_pre_4THE DARK SATANIC RUMOUR MILL is so certain that tinman Michael Dell is going to buy Palm, that hacks have started ringing around and asking the strokers of beards and people in the know to find out if it is a wise plan.

The rumour started when Dow Jones suggested that market conditions were making a merger more and more likely. So far neither outfit has mentioned a dicky bird about it happening.

However Computerworld have got onto the blower and asked three of their rentaquotes what the world would be like if it really was true.

Shaw Wu, a financial analyst at Kaufman Brothers, said Palm could be the target that would allow Dell to get into the smartphone market.

Financial strategy consultant Sramana Mitra said that that Palm needs to take on Apple and needs a chum to help take it on. Dell would be very good for it.

Yankee Group Research analyst Carl Howe pointed out that Dell had cash which Palm really needed and Dell needed to do something to cope with increased competition in its server market from Sun and IBM. He added that if Palm can get its Palm Pre out to the masses then it could make a bomb. It is arguably an Iphone killer.

Kevin Burden, an analyst at ABI Research told Computerworld that he first looked at Dell buying Palm two years ago and said that it would make a lot of sense.

At the moment Palm is probably hanging for Sprint-Nextel to ship out the Pre. However that outfit has not been doing well either and might not rush to put the phone out.

If Sprint doesn't perform the way Palm needs it to perform, that could kill Palm's much-needed momentum, Burden said.

Clearly they have not been watching Michael Dell much lately.

While giving a speech in Tokyo he strongly hinted that his company is working on a smartphone-like device. "It is true that we are exploring smaller-screen devices. We don't have any announcements to share today, but stay tuned as when we have new news we will share that with you," he teased.

He pointed out that, for the last three years, Dell had integrated 3G radios into its notebooks.  Dell already has agreements with many mobile carriers around netbook devices, so it wouldn't be unreasonable to expect it would get involved with smaller mobile Internet devices or smartphones in the future.

If Dell has a phone of its own then it does not need Palm for anything. µ





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