Palm vs Apple (iTunes Analysis That No One Else Is Talking About)

As the smartphone market increases and Apple gobbles up market share from its competitors what can smaller companies do to compete?

First, copy the good aspects of the product you are trying to compete against.  Next, improve your product in the areas that your competitors are deficient, and finally,  if you are smaller and more nimble you lower your price.  You lower the price because you are too small for the big boys to adjust their pricing in contrast to you.

This is exactly what Palm is trying to do with the Palm Pre smartphone.  Its a very good first try, and I think the phone has great potential, but right now its not up to snuff when compared to the iphone.  However,  Palm is doing something that I think Apple is very scared about.

The Palm Pre is (Sometimes) compatible with iTunes.  Apple doesn’t open iTunes to outside devices, so syncing doesn’t work on anything except Apple Ipods/Touches/Iphones, etc.  The Palm Pre masquerades as an older Ipod in order to sync with iTunes.

When the Palm Pre launched it worked great with iTunes, then about a week ago Apple released a “fix” for iTunes that broke compatibility with the Pre.  Palm has since released version 1.10 of webOS that has a fix for the fix that broke compatibility.  I suspect Apple and Palm will play this cat and mouse game for a while, but here is the part that almost no one is talking about –

Apple is scared to death to sue Palm and here’s why – If Apple sues Palm and loses they just don’t lose to Palm, they lose to everyone.  Right now the issue is still on legal quicksand.  There is all kinds of legal precedent that backs up Palm’s reverse engineering of the hooks into iTunes.  Many larger companies are too afraid of the legal implications of tangling with Apple, but Palm is a cornered beast.  They really don’t have a lot to lose, and Apple has everything to lose.  Palm knows this.  If Apple sues and loses be prepared for a tidal wave of “ipods” (Every smartphone, mp3 player, and modified 1985 walkman) connecting to iTunes in a matter of weeks.

There is nothing “technical” holding back devices from connecting to iTunes, its all legal threats keeping devices off right now.  I suspect in the end that Apple will “decide” (be forced) to license devices to iTunes rather than risk losing the lawsuit and getting no license fees.

I’m a HUGE Apple fan, but I’m totally rooting for Palm on this one!!!

Matt Heaton / President

14 Responses to “Palm vs Apple (iTunes Analysis That No One Else Is Talking About)”

  1. […] Palm vs Apple (iTunes Analysis That No One Else Is Talking About … […]

  2. That is really interesting! I’ve seen a lot on the Palm Pre lately and didn’t realize that they are battling with ITunes. I like ITunes but the fact that it only syncs with Apple devices is a pitfall that keeps me away and keeps me on Windows Mobile smartphones.

    Your mention of an IPhone brings up more pitfalls. I live where only Verizon has a signal which forces me to continue using a Verizon SmartPhone. I really wish that Apple would open up their technologies more, especially their IPhone.

    I too am rooting that Palm wins this one!

  3. Dee says:

    I am a sprint customer and hooked to my simply everything plan, I am using a windows mobile device currently. I am also a huge Apple fan. You are the second Apple fan to recommend looking at the palm-pre. Thanks for the perspective. I may give it a try. Btw, Thanks for the core protection!

  4. matteo says:

    Sounds like palm needs to create a nice open source equivalent of the palm hotsync app to sit between a stable palm itunes syncing API and itunes itself. Once this little program is open source, anyone who feels like taking on apple (like, six kazillion college students. nerds and hackers) can update the program. Palm just has to verify the changes, update a small program (not their whole software) and on we go. Any other project or company that wants in to the synching can use the same program. As a bonus, with respect to your legal quicksand comment, there wouldn’t be anyone to sue even if Apple did decide they wanted to…

  5. Joe Green says:

    How about a-tunes, amarok, or scaling down wine to include only what’s necessary to run legitimate windows version of itunes? Isn’t the palm pre a mini PC in essence? I’m having trouble finding info on kernel, but apps appear to be java based- I imagine porting from solaris sources would be in order. I’m just sayin’..

  6. Joe says:

    Matt, agree with your premise that Apple does fear Pre to some extent. First, they went to the trouble of reprograming iTunes to block Pre. Palm has such a minuscule market share, why bother? Next, there is an article today that Jobs approached Palm for an agreement not to hire each other’s employees.

    Noncompetes (except in very limited circumstances) are illegal in California. Why would Jobs approach Palm with an offer like this unless he was concerned about Palm as a future competitor? Jobs seems awful interested in suppressing competition.

  7. r9 460 driver says:

    Apple is not a idiot.

  8. Bustor says:

    I too am with Palm on this

  9. That is great. There’s always been work-around’s for using itunes with other devices. It’s about time that apple gives up and opens straight compatibility. It should mean more sales for them anyway.

  10. Richard says:

    Hey Matt,
    I’m with you on being a fan of Apple – but with Palm on this one.

    Sorry but i disagree on the idea that the smaller player lower their pricing. As to me i think competition on price is the last resort – smaller players should always differentiate themselves as much as possible. they should choose their USP & hammer that home. (especially if that USP is something that the larger player doesn’t offer).

    & Matt – can i suggest something to you. I was a first time visitor to your site (coming from WordPress) and everything looked good – then i noticed that you guys have a live chat going on at the bottom of the landing page. I thought to myself – hey that’s a cool idea – give people live sales support – i like it! smart, differentiated.

    So i typed in a question – waited, waited… ok – got an innocuous answer, sent back the same question asked in a more specific way. Then i was a little alarmed (from a marketing perspective) as a window popped up saying that the support person was probably dealing with several people and that it might take between 1 – 5 minutes (WHAT!??) you’re joking!!

    Here i am – and right now i’m an 80% chance of becoming a customer – all it will take is for 1 good positive reinforcement & i’m in.

    waited, waited waited … back came another generic answer, so i asked something different about your offering…. waited, waited, waited… & thought to myself – hey if this is what its like when they WANT to sell to me – how bad must it be when you’re a customer. so i was outta there.

    Then i thought you might appreciate the feedback :-) I know I WOULD

    I like the idea, but if you’re going to do that, please, please, have a darn good response & get the people typing to be well trained & like they give a toss.

    I hope it works out well
    kind regards

  11. JC says:

    Just thought I would point out that the iTunes library information is stored in an unencrypted, well documented XML file. All Palm has to do it use that file as a guide, as makers of other devices do. Instead they’re reverse engineering iTunes in ways that they know Apple won’t be happy about.

    It’s a publicity stunt, and a way to cast themselves as the victim. Nothing more.

  12. I agree with you, as I like Apple. But I prefer Palm at the minute.

    I personally can’t wait for the Palm Pixi to hit UK shores. After reviewing the Palm Pre, one thing that was apparent to me was the slightly cramped keyboard which made texting a little bit awkward.

    The Pixi has fixed this apparently, however the camera resolution has been dropped to 2 megapixels, which to be honest is a shambles.

    WebOS is amazing, the 1.3.5 update will be amazing I am sure, and if Google could go back knowing about WebOS they’d surely design something very similar.

    Thank you for the post.


    Jakk – Your fellow Technoholic 😀

  13. Anytime, Any day, Apple has my Vote!

  14. I will side with Apple for sure. The specs and iOS 5 will be mind blowing for their new products and I really can’t wait to see what they bring to the table this year.

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