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Did Palm get it right with the cancellation of Foleo?

by on10 September 2007

It seems like not everyone agrees

Over the past week or so, I have been hearing a lot of opinions on whether Palm CEO Ed Colligan’s decision to cancel the Foleo was a good decision. Let me start by saying that Palm has had a lot of trouble getting in the news of late and they really have not had much to brag about recently. If Palm could generate this much buzz every time that they launched a product then they would be sell a lot more Treos, that is for sure.

Maybe it has just been a slow news week, or perhaps people just like to talk about something that might have been. We can’t be sure. What we are fairly certain about is that Foleo was a product concept seeking a market space that either does not exist or one that does not exist yet. Still, the Foleo has generated much interest from the Palm community of users and everyone seems to have their own opinion as to whether Palm should have gone into production with the Foleo.

From the Palm Info Center to the Foleo oriented Foleo Fanatics, the discussion continues about a product that is now dead, at least for the time being. Some have suggested that the development team purchase the IP from Palm and try to make a go of it themselves. But who would invest in such a risky product that by many accounts has only a long shot at making it?

Given the current state of the market, we think Palm did the right thing in moving on from dedicating resources to a product that was not that well received by many consumers or by the mainstream media. Sometimes innovative concepts just do not mesh well with the business goals of the company, and sometimes they are just introduced at the wrong time. Right now, Palm is fighting for their very survival in a crowded market space with the Treo smartphone products with competition coming from every direction trying to get a slice of its pie.

While it is nice to continue to discuss the merits of this concept, we just don’t think the timing is right for the Foleo in its current configuration. Maybe in the future this could change, but we doubt it. Palm has to continue to focus on the next generation of the Treo, as well as the Palm OS, and trying to regain some market share before they can take more risks on trying to innovate. Some may complain that Palm is merely playing it safe, but the facts are that the marketplace is tough.

While the decision may not be popular with some Palm fans, the long-term financial health of Palm is what is at stake here; and while writing off $10 million might sound like (and is) a lot of money, the damage could have been much worse if Palm had gone into production with the Foleo. Perhaps we just didn’t understand the product, but we do know that if consumers at large are not clamoring for a device of this type, cutting bait on Foleo was the right thing to do.

Palm still has a lot of good engineering talent and ideas that lead to innovative products such as a product like Foleo might have offered, but let’s hope that Palm puts these people to better use in the next generation of the Treo, rather than on taking a risk on something that very few consumers seem to want. In the meantime, let’s see if the market space has an opening for a product like the Foleo; and if it does, we are sure that Palm with be there with such a product.

Last modified on 10 September 2007
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