Last week, we reported on – and were amused by – the quotes from big Palm investor Roger McNamee, who made some pretty bold claims about the upcoming Palm Pre and its main competitor, the iPhone. Even though McNamee is not an employee of Palm, the company did issue an unusual retraction today.
The retraction was issued at the Security and Exchange Commission in the United States, which is a rather unusual method of issuing such statements. The filing containts ten itemised clarifications and corrections, effectively retracting everything Roger McNamee has said.
The items on the list refer to the original article on Bloomberg. Looking at the list, these are the few that were really interesting:
5. With respect to the statements in the tenth paragraph of the transcript that the Palm Pre is “going to be a million times – well, not a million times – several times faster” than Apple, Inc.’s iPhone products and is “going to run rings around them on the web,” the Palm Pre is still under development and it is premature to state the speed at which the device accesses the web or the relative speed of the Palm Pre compared to the smartphone products of competitors.6. With respect to the statements in the twelfth paragraph of the transcript that “there are aspects of the Pre that are unlike any phone you’ve every seen before,” “the Pre is the first one that is the next generation” and “the result is it does a lot of things the others guys don’t do,” the Palm Pre is designed to be the first phone based on the Palm webOS platform and as a result will have different operating characteristics and features than other phones, however; the Palm Pre is still under development and it is premature to compare its full functionality with that of other phones.
8. The statement in the second paragraph of the article that “not one” person who bought an Apple, Inc. iPhone on the first shipment date “will still be using an iPhone a month” after the two-year anniversary of that day is an exaggerated prediction of consumer behavior pattern and is withdrawn.
9. With respect to the statements in the second to last paragraph of the article that “the underlying technology for Research In Motion Ltd.’s BlackBerry is about 13 years old, while the technology behind the iPhone goes back almost nine years,” estimating one specific age for the many technology components underlying any mobile phone is inherently imprecise and these statements are withdrawn.
10. With respect to the implications in the second to last and last paragraphs of the article that Palm’s new operating system will give it an edge over competitors that “are going to run out of gas way before” Palm, estimations of the relative useful lifespan of smartphone operating systems are conjecture, unverifiable at this time, and age is not necessarily predictive of their relative long-term success.
It is quite clear that Palm is not amused by McNamee’s statements, most probably because Palm doesn’t want too much hype about the Pre. Palm has been relatively tight-lipped about the device, and McNamee’s statements didn’t really fit into the picture.
Key investor or not, McNamee has just been whipped.
That’s because this investor almost certainly has a rather large amount of insider information, and this could be deemed to be manipulating other investors into making their decisions based on this insider knowledge, being stated from someone that would seem logical to have such insider knowledge. In other words, Palm clearly has a problem with letting such things stand from the SEC’s point of view as it is material knowledge that this investor almost certainly has, that may be (real or perceived) used to manipulate the price of the stock: this is absolutely a bad thing from a legal point to have happen, or even the perception of it. If you’ve ever been employed by a publicly traded company, there’s all kinds of things about what you can and can’t do, and why, regarding “material information” such as this investor almost certainly has, or at least outsiders have a reasonable expectation that he has. As soon as they’re aware of any such breaches, like any company traded, they’re required legally to do what they’ve done.
Palm is just doing their legal requirements: this isn’t nearly so odd as you make it out to be, except for the fact that someone that’s not associated with a rumor site said this much.
In lamens terms: “He was full of crap and knows nothing of the technologies nor what it takes to deliver the end-to-end competition for the iPhone.”
Actually, in laymen’s terms, it means:
“This investor is shooting off his mouth, and making claims that could affect stock prices, we can’t look like we condone insider trading, so we have to disavow him”
That’s an effect, not the cause. The cause to make this guy shoot his mouth off is rhetoric from Palm engineers who didn’t expect their marketing hype to be spewed forth for the world to read, long before a product arrives.
Undersell, over deliver. The other way around spells doom.
Source?
Exactly… the retraction reads like a retroactive version of the “forward-looking statements” disclaimer that JLG used to be fond of.
this is pretty standard for anyone large company when some investor shoots his mouth off. its just standard damage control, happens all the time…
It’s not like anyone outside of the 3 remaining Palm users care anyways. Palm had their chance to be the main player in the game, but rested on their laurels for way too long and did nothing to improve their technology.
Palm is about as relevant as SGI nowadays.
Edited 2009-03-11 01:03 UTC
The smart phone market is highly competitive, and not nearly as closed as the desktop market. Any company, whether it had past successes in the market or not, can be successful with a good product. There’s up till now no reason to assume the Pre is not a good product, and therefore no reason to assume it is doomed for failure.
JAL
Strange when I see it coming from someone connected to Palm. It doesn’t seem quite right. PalmOS sat for so long that you’d think everyone around it would be quite reserved.
I’d expect this kind of hyperbole from an Apple fanatic who can’t see reality, but just as Apple doesn’t apologise or retract (in general), why is Palm?