Palm headed for the abyss?

Paul Nesbitt

Palm has some nice smartphones in its range, but the company is in deep financial trouble and analysts are predicting its demise if a buyer doesn't step in.

Palm's woes deepened following its announcement that its VP of software and services, Michael Abbott, has resigned. Abbott's resignation is significant as he was in charge of Palm's webOS, the company's smartphone OS, which is generally regarded as the main selling point for devices like the Pre, as well as the most attractive part of the company to potential new owners.

'We believe any potential acquirer would likely want (and need) the webOS development team,' observed UBS analyst Maynard Um.

Palm has recently been linked to buyouts from Dell, Lenovo, Huawei, and even HTC. But while Palm continues to lose money, suffer stalling sales, and face an increasingly uncertain future, no buyer has yet emerged.

Morgan Keegan analyst, Tavis McCourt warned that losing Abbott meant that a buyout was 'less likely' while Morgan Joseph analyst, Ilya Grozovsky, effectively valued Palm as worth nothing.