Verizon Wireless Offers Free 3G Tethering on Palm Phones, Slashes Prices

by Gaurav Kheterpal on April 3, 2010

Verizon Slashes Prices for Palm Phones

Verizon Slashes Prices for Palm Phones

In a move that can be attributed to Palm‘s dwindling fortunes and below par sales, Verizon Wireless made two dramatic announcements on Thursday (April 1st). First, the free Palm mobile hotspot app now comes with free service and the first 5 GB of data each month now comes at no extra cost. Second, it has slashed the prices of Palm phones and it is now offering the Palm Pre Plus for $49.99 and the Palm Pixi Plus for $29.99 (requires two year contract commitment). A buy-one, get-one free offer is also currently available.

Just in case you are curious about the timing of these announcements, these are not April Fool Jokes. Given its sorry state, I don’t think a company like Palm can afford any such jokes. I browsed through the Official Palm Blog to make sure that these announcements are indeed genuine and I found this post which confirms these announcements.

The Palm mobile hotspot app lets your Palm Pre Plus or Palm Pixi Plus share the 3G bandwidth with up to 5 other Wi-Fi devices. So, while the smartphone data plan is unlimited, but tethered usage isn’t. Prior to this announcement, Verizon charged users for connecting devices while giving away the app for free. As for the slashed prices, I think it is clearly a move of desperation. Verizon sees the contract to be more valuable than the Palm phone itself. It’s quite a deal for consumers to buy decent smartphones at the fraction of a price. It is interesting to note that these announcements from Verizon come less than two weeks after Palm reported dismal last fiscal quarter results. A while back, I wrote a story about AT&T’s plans to launch Palm Pre Plus and Palm Pixi Plus later this year.

There is no doubt that Palm is struggling. Its market share has fallen as Apple, RIM and Android phones have gained in popularity. Will Verizon’s lucrative pricing strategy work? I’m not sure. I do not know if Verizon is aiming to clear out stale inventory nor is a true ‘friend in need’ for Palm. In fact, if Palm experiences one more below par sales quarter, I’d hardly be surprised if Verizon decides to dump Palm altogether.

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Written by: Gaurav Kheterpal. www.digitcom.ca. Follow TheTelecomBlog.com by:RSS,Twitter,Identi.ca, or Friendfeed

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