Top US mobile service Verizon Wireless announced yesterday it would be selling the Palm Pre as part of its upcoming device line-up, sending Palm shares up 8.8 per cent.
Palm is depending heavily on Pre to revamp its own business and regain market share from rivals such as Apple. The Pre is also seen as key to helping stem customer losses at Verizon's smaller rival Sprint, which is launching the Pre exclusively on June 6.
Verizon will offer the Pre in the next six months or so, chief executive Lowell McAdam said during a conference webcast.
Verizon Wireless said its phone line-up would also include a new version of the touchscreen controlled BlackBerry Storm and a new BlackBerry called Tour.
McAdam said: "Over the next six months or so you will see devices like Palm Pre and a second generation Storm. You can expect to see us launch a steady stream of new devices from multiple vendors."
Some analysts had worried that Palm was limiting Pre's success by forging an exclusive agreement with Sprint, which lasts at least until year end.
As a result, UBS analyst Maynard Um said Verizon's Pre news was encouraging for Palm investors. But the analyst predicted increasing competition in the advanced phone market, saying that Motorola "could be the wildcard in the smartphone race" as it has the potential to be most aggressive on price.
"However, visibility in an increasingly competitive market is still limited," the analyst said in a research note.
Um also said he expects other new Palm phones based on the same operating system as Pre. Chief executive for AT&T, number two in the US, had said during a conference on Wednesday that his company would also like to sell Pre but he did not give a timeframe.
The comments come ahead of Sprint's long-awaited Saturday 6 June launch of Pre and the expected announcement of a new iPhone from Apple in the week after that.
Top executives from both Palm and Sprint have said they expect Pre shortages around the launch because of strong demand.
Verizon Wireless is already the exclusive US carrier for the first BlackBerry Storm launched late last year. While reviews of the first Storm were mixed, Verizon had said on 28 January that it had sold 1 million phones since the device's November launch.
McAdam said the Tour would be a new upscale BlackBerry, that that company expects to sell along with Storm in the next six months or so.RIM had said earlier this month that it was planning a new edition of Storm to help it push into the consumer market but it had not announced a timeframe.
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