Ex-Apple man takes charge of Palm

 

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By Reuters

Posted on 11 Jun 2009 at 10:33

Ex-Apple man Jon Rubinstein has been named the new chief executive of Palm, as the company seeks to revive its fortunes with the Pre.

Rubinstein was brought in from Apple in 2007, where he was senior vice president of Apple's iPod division, and instrumental in the creation of the market leading gizmo.

He was given the title of Palm's executive chairman and quickly became the face of the Pre smartphone, popping up at various industry conferences and touring retail outlets.

Rubinstein succeeds Ed Colligan, a 16-year Palm veteran who will take some time off and then join Elevation Partners, the investment firm which has a 25% stake in Palm.

News of Rubinstein's appointment came on the heels of the Pre launch, considered the company's best chance to compete against Apple, Nokia and RIM.

Despite the early success of the Pre, there's still a big job ahead of the new chief executive. In its third quarter, Palm reported a $95 million net loss after the company's smartphone revenue fell 72% to $77.5 million.

"It is true that Palm still has challenges," says RBC Capital Markets analyst Mike Abramsky. "It has to reestablish relationships and its reputation with users who have been disenfranchised by the old Palm."

But Abramsky believes Palm is poised to become a key player in the global smartphone market, armed with multiple smartphones based on its new WebOS operating system.

Sprint, which has exclusive US rights to carry the Pre, claims it clocked record sales of the Pre during its first weekend of sales and was restocking the phones "as quickly as Palm could make them."

Indeed, shares of Palm have fallen this week amid concerns that sales of the highly anticipated new phone, which has garnered good reviews, may be hampered by supply constraints.