Please ensure Javascript is enabled for purposes of website accessibility

How Palm Could Change Everything

By Tim Beyers - Updated Apr 5, 2017 at 7:53PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

We've seen it before.

Palm (NASDAQ:PALM) is scheduled to hold a press event Jan. 8 at the Consumer Electronics Show in Las Vegas, at which it is expected to debut its Nova smartphone operating system.

Call it D-Day. Time to do -- or die trying.

Over the next two days, I'll game out two ideas for what Palm's hopeful sunburst will be -- one, a game-changer; the other, game over. Let's begin with the game-changer, an idea that would allow Palm to make good on board member Roger McNamee's pledge to "transform the cell phone industry."

Be kind, rewind with me
Innovators zig as others zag. That's the challenge Palm faces, to do something that neither Apple (NASDAQ:AAPL) nor Research In Motion (NASDAQ:RIMM) nor Nokia (NYSE:NOK) nor Motorola (NYSE:MOT) has done or is doing now. I can think of one thing: handwriting recognition.

Handwriting recognition has vexed the industry for years. Only a few have made it work well enough to win customers. Apple tried with the Newton, which, in turn, birthed a series of non-starters such as Go's tablet computer. IBM (NYSE:IBM) was even in on handwriting recognition for a time. Microsoft (NASDAQ:MSFT) had it in a tablet PC version of the uncommonly durable Windows XP operating system.

We tend to forget  that where these others failed, Palm succeeded.

Surely I can't be the only one to remember the old PalmPilot and its Graffiti recognition system, can I? Graffiti set the Pilot apart because it was an easy-to-learn language, and therefore a better alternative to deciphering barely legible scribblings.

Record sales followed. Press reports from 1998 show that the PalmPilot captured roughly 66% of the market in its first 18 months of release. More than 1 million units were sold, five times more than what Apple's Newton sold in its entire history.

The PalmPilot remains a cult icon to this day, so much so that the Graffiti language persists. Software called Graffiti Anywhere makes the language accessible to owners of the latest Palm devices, including the hot-selling Centro and Treo smartphones.

Can there be any doubt that a breakthrough in handwriting recognition -- Graffiti 3.0, perhaps -- would lead to commercial success?

A better business in Palm's hands
Imagine what might be if Nova were a lightweight, touchscreen Linux OS with advanced handwriting recognition, a new Graffiti for a new era.

At the very least, it would unite Palm's product lines and make them more extensible. Consider the failed Foleo. Built on Linux by Palm co-founder Jeff Hawkins -- a tech Hall of Famer if ever there were one -- it was pegged as a "smartphone companion." Think of it as a lightweight netbook. Yuck.

Foleo also needed emulation to run Palm OS software, bringing into sharp relief the company's failure to create a well-integrated family of products built on a common platform. Nova is an opportunity to change that, to be like more like Apple, whose Mac OS X is the secret sauce behind both the Mac and the iPhone.

Nova could also resuscitate Foleo. This is what I mean when I say "extensible." Platforms always are. Here, a Nova-powered netbook would be set apart by Graffiti. So would a Palm tablet. Or a new Treo. And each device would be interoperable with the others, because they'd have been built using common interfaces to the Nova OS.

There's a market for this. Palm's new Software Store already hosts 5,000 applications, and Linux is a popular OS with coders. Nova just has to be novel and have good tools for developers to work with. Handwriting recognition could supply the novelty; Palm will need to supply the tools.

But will it? I hope so. If our 125,000-strong Motley Fool CAPS community is any indicator, and it usually is, this is Palm's last shot at survival. Nothing less than a game-changer will do:



CAPS stars (out of 5)


Total ratings


Bullish ratings


Percent bulls


Bearish ratings


Percent bears


Bullish pitches


Bearish pitches


Data current as of Dec. 29, 2008.

D-Day is less than a fortnight away, Palm. You've got till then to show us something brilliant. If you don't, then it's likely game over. And none of us wants that.

Apple is a Stock Advisor selection. Microsoft and Nokia are Inside Value picks. Try either of these Foolish services free for 30 days. There's no obligation to subscribe.

Fool contributor Tim Beyers is a member of the Rule Breakers team and had stock and options positions in Apple and stock positions in IBM and Nokia at the time of publication. Check out his portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. Its disclosure policy isn't here right now. Please leave a message at the tone. Beeeeeeeeeeep.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Palm, Inc. Stock Quote
Palm, Inc.
Microsoft Corporation Stock Quote
Microsoft Corporation
$291.91 (1.70%) $4.89
Apple Inc. Stock Quote
Apple Inc.
$172.10 (2.14%) $3.61
Nokia Corporation Stock Quote
Nokia Corporation
$5.21 (0.00%) $0.00
International Business Machines Corporation Stock Quote
International Business Machines Corporation
$134.01 (1.11%) $1.47
BlackBerry Stock Quote
$6.78 (0.59%) $0.04
Motorola Solutions, Inc. Stock Quote
Motorola Solutions, Inc.
$255.97 (1.46%) $3.69

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/15/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.