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Palm dumps Windows Mobile for WebOS

Future handsets will use its own OS

Palm has revealed it is dumping Windows Mobile software from new handsets in favour of its new WebOS software.

The news came as the struggling handset maker reported widening losses for the quarter during which it unveiled the new Palm Pre, the first device to run WebOS.

Losses for its first quarter reached $164.5m, compared with a loss of $41.9m in the same period last year. Nevertheless, the results beat analyst expectations.

Adjusted sales were $360.7m, better than the $297.7m anticipated by analysts polled by Thomson Reuters.

So far, the Pre is only available in the US and Canada. A UK launch date hasn't been released yet.

Palm has already signed contracts with additional operators to bring phones using WebOS to new and existing markets, said Jon Rubinstein, chairman and CEO of Palm.

Palm last week announced the arrival of the newest WebOS phone, the Pixi,which is expected to be made available before Christmas.

Slow ramp-up

Rubinstein defended the relatively slow ramp-up of the Pre by comparing it with the Centro, an earlier Palm device that was an unexpected hit. That phone started off slowly too, but ended up being sold by about 30 operators around the globe, he said. "I expect a similar trend [for the Pre]," Rubinstein said.

In the future, Palm plans to focus solely on WebOS rather than developing phones that run operating systems from other vendors such as Microsoft.

"While there are still Centros and Treos moving through the channel, our future engineering efforts are based around WebOS," Rubinstein said. The Centro runs Palm OS, Palm's previous operating system, and the Treo runs Windows.

The appeal of the Pre to business customers - a segment that Windows has traditionally appealed to - may have helped Palm decide to focus on its own phones and drop Windows.

"We found early on that demand [from businesses] was stronger than expected," Rubinstein said.

As a result, Palm has accelerated updates to the WebOS platform, such as improved Exchange security policies, that business users want, he said.

Though Palm probably did not make up a major share of Windows sales, the news is probably a blow to Microsoft, which has struggled to keep up in an increasingly competitive mobile market.

Updated Windows phones running version 6.5 will come in early October, but the more significant upgrade - the apparent response to the launch of the iPhone two years ago - won't arrive until next year.

"Palm has been and remains a great partner to Microsoft, and they are one of the many companies we work with to deliver a compelling range of mobile offerings," a Microsoft spokesman said.

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See also: Palm Pre available for pre-order in UK


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