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grimani wrote:

Discussion on whether PALM is a RB, and if so, when the best time to buy is...

read the link. found it informative, well written, etc.
i'm new to the GG, and am not completely finished with the book, but last night while reading i began to wonder if the handheld market is "in the tornado" and whether palm was a gorilla or gorilla potential within this market.

the handheld market is not new. in the 1980's i had a neat digital watch (casio) that could hold phone numbers and so forth. the newton (one of my favorites) was a cool little pda. pda's are a big thing now. now qcom and nok are/have been shipping mobile phones with pda capability.

first, is this discontinuous technology? imo the answer is "it depends." is the palm top an extension of the desktop? i could argue either way on that one. in the end, i think the palm top may be a discontinuous technology because the applications have the potential of running on a diverse set of devices (i.e. pda, pager, wrist watch, etc.). the palm top is also a paradigm shift from bulkier desktops to the info-appliance. but in the end i am not sure on this one.

i believe the palm os is an enabling technology, but then so is win ce. i like the potential returns on palm os licensing to handspring, qcom, etc. win ce seems to have more device manufacturer support, but otoh most of those manufacturers appear to also create wintel pc's, making me question if win ce is merely an attempt of msft to head off a potential gorilla and have [at least some portion of] their technology replaced by this discontinous innovation.

second, is it open-proprietary? palm owns the interface. there are two interfaces: the palm api and the conduit api. the palm api is the interface for creating programs that run on the palm os. the conduit api is the interface for integrating desktop applications with any palm application/database.

are there high switching costs? i believe so. converting a palm address book to a win ce address book could be a difficulty. converting an application from palm to win ce could be downright painful.

if i apply normal rule breaker type of analysis to palm, then i would be shorting the stock since it trades at a PEG of 5+. btw - anyone else notice that gorilla's tend to have PEG ratios that are pretty high? csco (3.9), jdsu (5+), orcl (4.3), msft (2.2), all have (imo) high PEG ratios. is this the nature of being a gorilla.

like i said, i have not fully finished the book. anyone have some clues for me? thanks.

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