HTC Interested in Buying Palm

No other smartphone manufacturer has sown its seeds as broadly as HTC. Motorola is banking solely on Android. Samsung, Sony (though with plenty of Symbian history), and LG are fairly new entrants to the smartphone OS market. Apple, Palm, RIM, and Nokia (though not for long, when Symbian becomes fully open source) are closed systems with their own proprietary software. All this time, HTC has been backing Windows Mobile and Google Android like no one else. With Palm’s devastating fiscal revelations serving as the backdrop, new speculation has surfaced that HTC might be interested in buying Palm and thereby gaining a third smartphone OS to its stable.

Back in 2008, when HTC was just becoming recognized, it was looking to acquire a US design company. Fast forward to today, and Palm is in dire trouble. CEO Jon Rubinstein has said that he is open to licensing out its WebOS.

According to UDN, HTC chief Peter Chou is in negotiations to purchase Palm. Rubinstein’s comment is that, “If there is a reasonable acquisition proposal, the Board will consider.” Lenovo is the other primary candidate to buy Palm.

What all this means is that if HTC actually takes over WebOS, it will be the only major smartphone company to manufacture devices for Android, Windows Phone 7/Windows Mobile, and have an established (which Samsung’s Bada is not) operating system of its own. If this deal goes through, HTC’s buy-out is very risky, particularly since the future looks bright for WP7 and Android. In essence, HTC would be creating greater competition for its existing Windows and Android smartphones. Would an HTC WebOS really be a better product than a Palm? The problem with Palm right now is not hardware or software. From my perspective, the company is losing the marketing war.