Apple was outbid by HP for Palm acquisition - report
Apple reportedly sought to purchase its smartphone rival Palm earlier this year, but was outbid by PC maker HP, which paid $1.2 billion for the struggling company.
Dan Frommer at Silicon Alley Insider on Thursday reported that Apple was in the race to buy Palm, along with Google and Research in Motion. That information comes from an anonymous source familiar with the negotiations.
"Apple was mostly interested in Palm's huge library of intellectual property and patents (450+ patents on file, another 400+ applications on file)," the report said. "And unlike some other bidders, Apple even seemed committed to funding Palm's operations, perhaps to challenge RIM's dominance in the keyboarded segment of the smartphone industry, our source says."
Frommer also said that Google was interested in Palm's intellectual property too, but was allegedly more interested in the company because it "thought Apple might want it. But Google supposedly didn't know Apple was bidding for Palm, so it didn't proceed."
But HP ended up sealing the deal, and now owns Palm's creations, including its much-touted webOS mobile operating system. The company plans to use webOS on future tablet devices that it hopes will compete with Apple's own iPad, also based on an operating system originally created for a smartphone.
Palm and Apple have one significant connection in Jon Rubinstein, who helped to invent the iPod for Apple. He is credited with discovering the 1.8-inch hard drive within Toshiba's labs, and placing it inside Apple's iconic portable music player. Rubinstein later retired from the company, where he was was last the vice president of the iPod division, in 2005.
Two years later, Rubinstein joined Palm, and just last year, with when its Pre smartphone went on sale, he was named the new chief executive of the company.
Dan Frommer at Silicon Alley Insider on Thursday reported that Apple was in the race to buy Palm, along with Google and Research in Motion. That information comes from an anonymous source familiar with the negotiations.
"Apple was mostly interested in Palm's huge library of intellectual property and patents (450+ patents on file, another 400+ applications on file)," the report said. "And unlike some other bidders, Apple even seemed committed to funding Palm's operations, perhaps to challenge RIM's dominance in the keyboarded segment of the smartphone industry, our source says."
Frommer also said that Google was interested in Palm's intellectual property too, but was allegedly more interested in the company because it "thought Apple might want it. But Google supposedly didn't know Apple was bidding for Palm, so it didn't proceed."
But HP ended up sealing the deal, and now owns Palm's creations, including its much-touted webOS mobile operating system. The company plans to use webOS on future tablet devices that it hopes will compete with Apple's own iPad, also based on an operating system originally created for a smartphone.
Palm and Apple have one significant connection in Jon Rubinstein, who helped to invent the iPod for Apple. He is credited with discovering the 1.8-inch hard drive within Toshiba's labs, and placing it inside Apple's iconic portable music player. Rubinstein later retired from the company, where he was was last the vice president of the iPod division, in 2005.
Two years later, Rubinstein joined Palm, and just last year, with when its Pre smartphone went on sale, he was named the new chief executive of the company.
Comments
RIM has done very well as a company main led by engineers with nowhere near the vision that Apple has. Had they won and had an infusion of palm (and so a bit of Apple) they could have become a serious threat to Apple in the consumer space.
The most interesting part of the original article was how close RIM came to buying them. RIM's original bid was substantially higher than the bid HP won with, but revised their bid to just below HPs bid and lost.
RIM has done very well as a company main led by engineers with nowhere near the vision that Apple has. Had they won and had an infusion of palm (and so a bit of Apple) they could have become a serious threat to Apple in the consumer space.
Yeah, I agree.
It seems some business-head at RIM may have thought they could hardball the price (since Palm was desperate at the time), and perhaps lost the whole deal. RIM + Palm would make for better competition than HP ever will.
I still like the iPhone far better than any of the alternatives though, (and especially kind of despise Android), so having Apple buy up Palm would be my best case scenario. Too bad neither scenario will ever happen now.
Yeah, I agree.
It seems some business-head at RIM may have thought they could hardball the price (since Palm was desperate at the time), and perhaps lost the whole deal. RIM + Palm would make for better competition than HP ever will.
I still like the iPhone far better than any of the alternatives though, (and especially kind of despise Android), so having Apple buy up Palm would be my best case scenario. Too bad neither scenario will ever happen now.
Agreed on all points. RIM realized they overbid, but dropped the followup too far. I would stay with Apple, but it would have been interesting to see what the result of Apple DNA (via Palm) being infused into RIM would have produced. They have some great engineering talent, but if they want into the consumer space, they need something to match Apple's finesse.
Competition is a good thing, especially when the other company is capable of funding research into new things without worrying too much about funding.
Let me guess: Palm had a patent on how to hold a mobile phone in the palm of your hands without a problem?
Jesus, we couldn't go 10 posts without some dumb ass troll blowing off topic and bringing up the antenna issue.
For the other bidders, they had their own objectives for acquiring Palm. RIM wanted the IP but they need the overall tech of the Palm OS far more than Apple does. I'm sure that Apple feels hiring HP's engineer responsible for WebOS' notification engine was a far cheaper play than paying too much for Palm.
Google, like Apple, just wanted the IP since they thought Apple was going might be playing for it (much like the AdMob acquisition). But I suspect they realized that Wall Street thinks they paid too much for AdMob (especially since Apple had a second choice M&A target) so they would not make the same mistake again.
That leaves HP which actually wanted to use WebOS for other things in their product strategy. A lightweight version of WebOS in devices like printers would be a far better interface than what's in HP's current products. And it gave them a platform for tablets and phones they didn't have otherwise which means they wouldn't have to depend on Microsoft or Google for OSes. The IP ownership was a bonus. In the end, that was worth $1.2 billion for HP.
It might have made sense for Apple to buy Palm... they could have used Palm as a way to compete against Google on Verizon's network, while always making sure that Palm was just a little behind the iPhone. Plus there's all the IP. Oh well, maybe Apple has better ideas for how to spend their cash.
As a shareholder, I am glad the transaction didn't happen. That amount of money is better spent on new product development for the iPhone than securing patents. After all, with their cash reserve, they can afford some good lawyers. And from the looks of things, it seems like webOS will die a slow death at HP...what better outcome can you ask for really.
Jesus, we couldn't go 10 posts without some dumb ass troll blowing off topic and bringing up the antenna issue.
What makes him a troll?
The fact that he or she only submitted ten posts to your 109?
The fact that he or she registered close to six months before you?
It is you who brought up the word antenna not him? It is Apple's problem that this has gone on to the extent that it has that one can merely say "hold a mobile phone in the palm of your hands without a problem" and have those in the loop know what that means. Does that make them a troll? He has the word "Palm" in his post and you don't and what is the subject about? Palm acquisition!
I don't see troll. I see someone who has the same slapstick comedy mentality that can be found in many a posts I submitted!
Oops, I guess that makes me a troll...
What makes him a troll?
The fact that he or she only submitted ten posts to your 109?
The fact that he or she registered close to six months before you?
It is you who brought up the word antenna not him? It is Apple's problem that this has gone on to the extent that it has that one can merely say "hold a mobile phone in the palm of your hands without a problem" and have those in the loop know what that means. Does that make them a troll? He has the word "Palm" in his post and you don't and what is the subject about? Palm acquisition!
I don't see troll. I see someone who has the same slapstick comedy mentality that can be found in many a posts I submitted!
Oops, I guess that makes me a troll...
Oh, well, yeah, you are a troll. And no, you aren't a comedian.
Let me guess: Palm had a patent on how to hold a mobile phone in the palm of your hands without a problem?
Actually, best post since a while now.
It might have made sense for Apple to buy Palm... they could have used Palm as a way to compete against Google on Verizon's network, while always making sure that Palm was just a little behind the iPhone.
Apple has never done anything like that as far as I remember. They acquire companies and close the doors.
Let me guess: Palm had a patent on how to hold a mobile phone in the palm of your hands without a problem?
That's just wicked! Funny, but still wicked! Made me laugh!
Best
Actually, best post since a while now.
Yeah kind of funny it is. Now Apple has to buy HP to get the mentioned patent.
I would think that Nokia would have the greatest reason of all to acquire Palm. Symbian isn't considered a leading smartphone OS by anyone and a portfolio of WebOS phones could have really changed the balance of power in the smartphone game, especially outside of the US. They certainly could have delivered a WebOS tablet. And it might have made the whole Apple vs. Nokia legal battle over IP a lot more interesting.
But they didn't seem to play at all, which is mystifying.
Yeah kind of funny it is. Now Apple has to buy HP to get the mentioned patent.
An interesting idea, but not necessary. HP probably makes a fair amount of money on licensing their IP (much like IBM) so I suspect that it wouldn't have been that hard to cut a deal. It's just another line of business for them.