“You know the beautiful thing: June 29, 2009, is the two- year anniversary of the first shipment of the iPhone,” Elevation Partners (which owns a huge portion of Palm) co-founder Roger McNamee told Bloomberg in March. “Not one of those people will still be using an iPhone a month later.”
Yes, that would be today.
So how did McNamee’s claim turn out? Well, let’s put it this way: If there was a foot-in-the-mouth award given every year, no one else would need to apply this year. Hell, it might take the prize for the whole decade. It’s a quote of Ballmer-level proportions.
Before I dive into any kind of analysis, I can say right off the bat that McNamee’s statement is false. Why? Because I bought the original iPhone on June 29, 2007. I am still using an iPhone today.
Something else to think about: Estimates are that Apple sold somewhere between 250,000 to 500,000 iPhones in its first weekend on sale in 2007. The last estimates given for Pre sales was that it sold around 300,000 by the end of June. It’s entirely possible that there haven’t even been as many Pres sold so far as there were iPhones sold during its first weekend. That doesn’t just make McNamee’s claim look bad — it makes it impossible.
I do not have a Palm Pre, but I have used one quite a few times now. It’s a great phone. The hardware isn’t exactly my cup of tea (I don’t like the keyboard), but there is no denying that the webOS software is very solid. Of course, it’s subjective, but I would say the Pre is the second-best smartphone on the market today.
But that’s not what McNamee said. He said, “Not one of those people will still be using an iPhone a month later.” The claim was laughable at the time, but it’s even more laughable now. He was, of course, implying that once people who bought the original iPhone saw the Pre, all of them would switch since their initial 2-year contracts would be up.
The reality has been much different. Not only is it likely that many of the people who originally bought the iPhone are still using one, but many of them have upgraded once or twice to newer models. And of course, there are millions more iPhone customers that have been added since then. Including millions since the launch of the iPhone 3GS, which was launched after the Pre.
Speaking of the Pre’s launch, it took place after McNamee’s claim, and it sold pretty well out of the gate. But Apple announced the iPhone 3GS a few days later, and as expected, it dampened much of the Pre hype. Sales of the Pre remained decent, but not stellar, and have been slowly trailing off ever since.
Contrast that with the iPhone 3GS that sold over a million units in just three days after its launch, and has remained red hot. It’s so hot that Apple has had a hard time keeping it in stock. The Pre, on the other hand, is widely available, according to recent inventory checks.
And while it’s not entirely fair to compare the two platforms by their app stores, the huge difference cannot be overlooked either. The iPhone launched its App Store a year ago, which was a year after the launch of the first iPhone. So there was already an installed user-base, which is one of the reasons why iPhone app downloads completely destroy Pre app downloads.
But at the same time, the iPhone App Store launched with 500 apps, the Pre’s App Catalog has an anemic 32 apps, nearly two months after its launch. The number is so laughably low that when two new apps were launched yesterday, it made headlines — for the fact that two new apps finally launched.
This is of course because Palm only just opened its SDK to the public, the lack of which really hurt its potential. With it out now, the Pre’s app ecosystem should grow much more quickly, but it will likely still be a few months before we really start to notice that.
But McNamee knew all of that when he made that statement, and yet, he still said it.
Now, it’s one thing to tout your own product, but calling out a rival with a comment so asinine, was a poor choice, to say the least. And to Palm’s credit, they knew it too, which is why they sent the SEC a filing with 10 clarifications and corrections about what McNamee said in one interview. Here’s the correction that relates to this:
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.
Oh, okay, why don’t we all just make outrageous claims then send the SEC a note to withdraw them? But that’s why we’re here, to hold people’s feet to the fire when they say idiotic things, even if they petition the SEC to withdraw them.
The fact of the matter is that the iPhone remains the hottest smartphone and may be the hottest platform overall on the planet, right now. Apple has sold around 25 million iPhones. Palm has sold something probably south of a half million Pres — it’s a number that Sprint wouldn’t even say during its earnings call. And whatever the number was, it was not enough to stop the service from bleeding customers last quarter.
The Pre, while a nice phone, has a number of things working against it, including Sprint’s smaller network (though I find it to be much better quality-wise than AT&T’s awful network), and the lack of a robust app ecosystem right now. But both of those should change shortly. I already spoke to the app problem, but Verizon has also announced that the Pre will be on its network sometime in early 2010. That will be big, I imagine.
But will it be iPhone-killing big? No, of course not. There is plenty of room for many smartphones on the market, you’d have to imagine that even McNamee knows that. I think his iPhone-envy just got the best of him with such a statement. And that was interesting because it added more fuel to the fire of the Apple/Palm rivalry, which was already an interesting one.
Palm has no shortage of ex-Apple employees now working for it, including newly appointed CEO Jon Rubenstein, who used to head Apple’s iPod and Mac divisions. And now they’re caught up with this cat-and-mouse game with Apple to make iTunes syncing work for the Pre.
The Pre is also the first mobile device since the iPhone to use multi-touch, something which brought out some interesting statements from Apple about protecting their intellectual property. There have been no lawsuits on that front, but we can probably safely assume that Apple looked into it, and probably isn’t too happy that it apparently cannot push for legal action.
Then there was the ad that Sprint made for the Pre, with an eaten apple (which also spoke to the first wave of expiring iPhone contracts). And then there was Apple trash-talking the Pre’s small app store size during its WWDC keynote. “And somebody else. I can’t quite read it. It’s small,” is what Apple’s Phil Schiller said. (The chart he’s referring to is above.)
But Apple can talk for now, it has earned that privilege by running laps around its rivals with its smartphone and App Store. Palm, has not. And they look bad today thanks to McNamee.
Today isn’t June 29th… which is incorrect, the date of the post or the quote?
Dan Grossman (@djg) – July 29th, 2009 at 5:43 pm PDT
^ never mind that.
I misread it also.
Quote: “Not one of those people will still be using an iPhone A MONTH later.” (emphasis added)
June 29th + 1 month = …
Ding ding ding! July 29th.
I misread the quote, my bad. “June 29, 2009, is the two- year anniversary of the first shipment of the iPhone” … “Yes, that day would be today.”
Reading articles a few hours a day and I start mentally skipping over the parts that look like press release nonsense (”–REDMOND, WA & SUNNYVALE, CA” right after the first sentence) and citations.
what are you asking? the quote noted the anniversary of the iPhone and said one month later, none of those customers would have iPhones. today is that date.
Today is “a month later”.
did you forget to add [SPONSORED POST], as you TC they would?
Anyway, palm pre’s failure so far is not due to the iphone but due to the imminent launch of dozens of Android phones. Why invest on a smartphone which may not be very smart after all (judging by the number of apps available) when there are quite a few apps on the android market already, some of which are awesome?
I thought about the Pre but got the sense from the commercials (and trailers at movies) that it was being marketed to women. I don’t want to be stuck in a 2 year contract with a “girly phone”. Looking at Android stuff for when my contract does expire.
I agree with you. All the ads are very targeted to woman which is a bad move.
Woman probably like the iPhone better anyway.
I got that sense too after hearing either McNamee or Rubenstein reference the back of the Pre being mirrored. Also would be easier for women with smaller hands to use the keyboard.
McNamee got the press to do exactly what he wanted: continue to talk about him, and as a result, the Pre.
He really won this one, to be quite honest.
@MG,
You are saying the Pre is better than the Google Ion Android phone you got at Google IO back in May?!?
,Michael Martin
GoogleAndBlog
I like that hardware a little bit more, but I like webOS better than Android from a user-perspective, so overall, yes, I like the Pre more.
My prediction is that the Sony Ericsson Xperia X3 Rachael Android phone will finally trump the iPhone 3GS once it comes out toward the Holiday Season – as far as overall design & capability – not sure if the sales numbers will quite match
,Michael Martin
GoogleAndBlog
Xperia is ugly.
It have a certain aura, but not necessarily a good one.
If X3 come out exactly the same look as those photos a couple of days ago.
It will officially be the No.1 on my most ugly smartphone 2009 list. N97 (White) just have to settle for No.2
This is getting tired… we get it, McNamee said something stupid, can we move on….? Palm retracted in the SEC filing, so?
And you know what, I own a Pre, and it is an awesome phone, wayyyy better than the iPhone on a much better network. And I think all the people who didn’t switch to the Pre from the iPhone are the idiots… paying through the roof for lousy service, and too proud and fanboyish to even entertain the thought that there could be a phone that is better than the iPhone. That is my opinion and I’m entitled to it.
McNamee never said that that was going to be his exact forecast and investors should jump on palm stock based on what he said. If you did that, you are too stupid to be in the stock market anyway and you will lose money. Bringing this tired rant again and again is just douchey. Not that I care (I know, I did take the time to post the cocmment yada yada) as I am enjoying the pre and would like them to succeed.
You are entitled to your opinion.
You deserve it.
It’s a great rant and it should continue for weeks and months ahead. McNamee and Bono and all the other investors are the idiots for flushing so much $$ down the toilet. They should have bought Apple stock with that money!! It would have delivered a nice return!
Roger? Is that you?
Roger used to be a great VC. What happened? Elevation’s portfolio is all dogs. Not even a single star. They would have done a lot better had they just invested all that money into AAPL instead of buying a huge chunk of Palm.
Remember how Roger sabotaged launch of Wordnik and TC and NYTimes covered that. Ridiculous.
And now Palm… Palm will be dead in a year. There’s no way that they’ll survive. You can’t survive by selling their product this poorly.
Finally, what will Bono do now? All his money is gone.
Oops, I noticed this after I wrote my post, it’s exactly the same thought– so how much would Palm’s valuation have to be for there to be an exit for Roger and Bono? Gigantic, it’s never going to happen!!
Classic MG: “But that’s why we’re here, to hold people’s feet to the fire when they say idiotic things, even if they petition the SEC to withdraw them.”
25 paragraphs to rip into one statement. That’s how I roll.
What a joke! Hold people’s feet to the fire as long as they’re not apple or twitter…
I’ll take the 32 quality Web OS apps over the 50,000 mobileOSX fart apps any day
LOL… let me know when there’s a one quality webOS app
ha.
1. Pandora
2. Documents 2 Go
3. Twitterrific
4. Skype
5. Things
6. AIM
7. Remote
8. Strokes
9. AOL Radio
10. Flixster
11. Google Earth
12. Last.fm
13. Convertbot
14. Urbanspoon
15. VNC
16. Air Sharing
17. Eliss
18. Brothers in Arms
19. Dropship
20. Edge
21. Metal Gear Solid Touch
22. Super Monkey Ball
23. Doom Resurrection
24. Flight Control
25. Keynote Remote
26. Bento
27. Analytics App
28. Classics
29. Lose It
30. MotionX GPS
31. MLB.com at Bat 2009
32. Yahoo Messenger
33. Midomi Music Identifier
34. Awesome Note
I can go on if you’d like me to…
Haha… you left off 1 app so you can say; “I can go on if you’d like me to” Genius Strategy. I like that buddy.
Please do! LOL
None of these apps are any special and yet there’s no more to list. LOL
Dear lord
Guys, there are a lot of awesome apps in the list above.
It’s just they are all iPhone apps, not palm pre apps
For christ’s sake 7. 25. 26 are from Apple itself.
exactly.
Another classic quote… are you Roger McNamee in disguise?
I’m with you on that!
That’s a lot of fart apps! Actually the number is over 65‚000 now‚ thanks. And 64‚970 of them are not fart apps.
2007 called. They want their iPhone fart app joke back.
Douche.
1 month later??? Are you sure?
This competition for platform native apps is so 1980s desktop wars all over again. Which explains why native phone apps are a regressive concept.
And there we go again Apple vs Palm Pre….
How many rounds is it going to be???
Rounds? This fight was over a long time ago…
Plam lost a year ago or so. They just don’t know it yet…
At least Roger McNamee has the balls to put his money where his mouth is. They invested $450M (almost half of their fund), hired a great team and came out with a phone customers seem to really like. He might have gotten over excited with that one quote. It might be time for techcrunch to move on and look at the big picture.
+1
And then he went and ran his mouth off‚ talking smack about a superior product‚ making the company he was funding file retractions with the SEC and generally trashing the credibility of people associated with the Palm brand.
If he cared at all about his money‚ he’d keep his mouth away from it.
Why did I know who wrote this post without checking the author’s name?
Yes you right… can we say FAnBOY
Well, I just have to add that the fact there isn´t a GSM version of the Pre yet has a small but still an impact on the Pre sales – while you could buy yourself an iPhone in Europe or Asia (say: in countries equiped with GSM networks) hoping there´d be an unlock one day, people didn´t do that. And i am sure that this still keeps EMEA developers away from the Pre – Pre/WebOS´s real lauch (from my european point of view) will be the GSM Pre launch.
^^^^ Because even a blind, deaf, fool could recognize Siegler’s anti-MSFT, pro-Apple bias regardless of how vehemently he denies it. Citing the two slightly negative articles you’ve written about apple and google doesn’t quite match the hundreds of articles you’ve written regarding the wonders of licking Steve Jobs’ balls.
It would have been interesting to see Windows Mobile apps numbers on the Applications chart. Should be close to or better than iPhone in numbers, better average quality (much less silly 1-run apps produced for WM) and you can actually install any app you want.
On the issue of 50k + apps on the iPhone app store. Is that number really something to be proud of? Can someone name off more than 10,000 quality, attention deserving apps? 5,000? 200?
There are plenty of them, for sure, but it’s meaningless to cite 50,000 apps if the vast majority of them aren’t worth the time it takes to download them. There is quantity, and then there is noise.
The Pre and others lack that towering bar of apps when laid out in a presentation, but I don’t think it really harms them here in the real world. As a developer looking to get into the market, is it better to try to compete with 50,000 other apps, or 200? Which gives a better opportunity to shine and stand above the crowd?
Then there is the noise some iPhone developers are making this week about quitting the iPhone as well. Citing hostile Apple practices, long approval times, and the fear of having their app removed out from under them after being on the store for four months.
To the point of the article, of course the Pre wasn’t going to stand up to the claims. They were silly to outright state them, and most likely didn’t believe them themselves. The iPhone has momentum, and it had that momentum before it was even announced. Apple was able to capitalize on 100 million + iPod users looking for the next best version. I don’t think anything on the market has that sort of advantage and I find it a bit silly to compare the others. Silly, albeit a bit fun.
I can name around 50 worth having iPhone apps, just for reference. About 20 that aren’t games.
You hit the nail on the head here… I love my iPhone..(for now) but I can’t think of more than 20 apps on it as we speak that I use on a daily basis.. (Facebook, The Weather Channel, ESPN ScoreCenter, Bank Of America, and GPS Motion X..) other than the phones native apps (text, mail) The list quickly starts to tail off after that.. Then there’s the whole Google Voice thing.. I don’t like Apple’s atttitude that (we won’t approve of apps that enhance the product we created because we’re Apple and you’re not!).. The Google phones are starting to look more appealing as time goes on…
Aww, c’mon, not such a big deal — at least Roger got free publicity out of it. MG, surely it is not the first time you’ve heard these fellas making wildly exaggerated claims? Why hold Roger’s feet to the fire for that?
To be honest, I was pleasantly surprised that Palm seemed to have something that looks half decent, and could help them survive as a company. I thought that firm had lost its mojo way back when.
Compare with Nokia or Samsung sales, the iPhone is still selling in minimal quantities.
OK the iPhone is the leader in a niche market.
Like Cabrinha is market leader in the niche market of kitesurfing.
Kind of like that Hertz ad campaign – there’s the iPhone, and then there’s “not exactly…”
interesting how there are no Windows Mobile app numbers listed there. would certainly be higher than the iPhone – but because it is a free world in MSFT land, you would never be able to track them down and get an accurate count. Same goes for Nokia.
Yea, the number for Windows Mobile would be WAY higher than iPhone, and I agree that they are dificult to find, but MS is jumping on the band waggon with an App store
Good things to come, and it has been anounced that it will be available for Windows Mobile 6 and 6.1 as well as 6.5
Please stop wasting valuable TechCrunch space on crap like this. So McNamee made an incredibly bold, some may say ridiculous, presumption. Now you resurrect it with some inane and pointless article comparing apps, sales, etc, when nobody really cares.
p.s. Apple has so many iPhone apps because their users need them to pass the time waiting for a phone signal.
Peter I agree with you 100%.
You have a massively inflated ego to think your judgement means a thing to McNamee. You guys didn’t get a review phone and have been pussies about it sine going so far to impugn the integrity of everyone who did get a early look. Everyone knew the statement was hyperbole and it did exactly what it was meant to which is stir the pot. Is it really worth all this? You have no credibility on the subject of the Pre and this overwrought post is an embarrassment. Why not revisit Jobs claiming that apps on the iPhone could bring down the cell network? That quote is at least as crazy as RM silliness and way more dangerous – after all, apple is now trying to turn that absurdity into a legal doctrine now.
test
Well hello again, Mr. Deceased Equus, shall we flog you again?
Seriously, why write this article? A guy known for hyperbole made a ludicrous PREdiction to promote a company he has a major investment in, one that everyone knew a long time ago wouldn’t come true . Nothing to see here, let’s move on.
Oh iPott,
You are so right!! I bet you also have a Zune and a Betamax VCR as well. Keep picking the losers.
Apple stock is the only thing to buy.
iPhone or (micromac) will be here long after your
gone and the real bitch about that is, it will make
much more of a difference than you did.
He should have known better and exercised restraint. Seems Pre owners would like to forget this embarrassing moment and move on, but it’s not going to happen just yet. Give it more time and pray he shuts up. I’m sticking with my iPhone. It changed the the cell phone industry for the better and deserves its current status.
I’ve never used a Pre and don’t need to or plan to. Most first gen iPhone users, like myself, simply upgraded to the 3G or 3GS. He didn’t get his wish. Whether the Pre is a fine phone is of no consequence. It arrived too late and will be relegated to me too status. It’s funny how vigorously Pre owners defend this phone that borrows heavily from the iPhone. Down to the former Apple staff. Only way to win is to fight Apple with Apple. Microsoft is also using the same tactic. I can only laugh in disbelief at MS and Palm.
Personally I find the ATT network far superior to Sprint, both in terms of technology, and in customer support. I was a Sprint customer for several years, and as with millions of others it was a living nightmare. I’m very happy with the 3G coverage on my iPhone, and I find ATT’s customer service very good. ATT’s network quality, here in greater Boston, is far superior to Sprint’s, and it continues to get better.
There’s nothing wrong with that prediction. But, as somebody commented earlier – “They invested $450M (almost half of their fund), hired a great team and came out with a phone customers seem to really like.” – and made CDMA phone. THAT’S the dumbest thing of the year.