Palm CEO on competitors, mobile manners

By Hannah Clark

updated 2:10 p.m. ET Aug. 30, 2006

If you've ever suffered someone gabbing obnoxiously on a Treo or sending an e-mail during a meeting, it would be easy to blame Palm CEO Ed Colligan. Along with Donna Dubinsky and Jeff Hawkins, Colligan helped build Palm, the company that produced the first decent handheld organizer back in 1996, after giants like Apple Computer tried and failed with its rather rotten Newton.

But getting to market first doesn't guarantee you'll dominate it. When one innovator successfully treads a new path, others quickly follow and improve on the original product. Among the competition that quickly dialed in is Research in Motion which launched its BlackBerry in 1999 and now has 5.5 million subscribers to its service. RIM is gained rapidly on Palm; in the first quarter of 2006, the company shipped 1.45 million of its mobile devices, compared with 590,000 for Palm, according to research firm IDC.

Those shipment numbers are reflected in the two companies' earnings. In its last quarter, RIM reported net income of $130 million on $613 million in revenue, while Palm announced earnings of $27 million on $403 million in sales. Both firms face competition from Motorola, which rolled out the e-mail-enabled Q in June.

As cellphones gave way to more sophisticated smartphones, you'd think users would have become smarter, too. Annoying ring tones still interrupt movies, men and women are e-mailing in the middle of meetings, and lunch companions continue to eye their in-boxes more often than they wipe their mouths. Colligan won't take the blame for all that bad behavior, but he did offer Forbes.com a few tips on mobile manners.

Forbes: What are the biggest cellphone etiquette problems you've seen?

Colligan: To me, one of the big etiquette problems is when people go to a meeting, and they’re sitting in the meeting, and the whole time they are doing e-mail, not looking at people and not even listening to the content of the meeting. I think it’s incredibly rude, and in our company I basically say, If you are going to be at the meeting, you need to be at the meeting and listen to the content. If you need to do your e-mail, then don’t come to the meeting.

Has your cellphone ever gone off in an awkward place?

It goes off all the time. But we have this really great feature on the top of the Treo. It’s a little switch that turns off all the volumes and sounds on the device, and it immediately goes to vibrate mode.

It seems like cellphone etiquette is getting a little better. Is it?

I agree with you — I think more and more people have become more sensitized to the idea that you don’t have to yell into your cellphone, for instance. A lot of people used to talk on trains and be constantly screaming at the person on the other end of the phone. I think people are more sensitive to where they are, and are more controlled in restaurants and other places. But there's still a big problem with driving while you are either talking on the phone or doing e-mail. It's rude and dangerous. In fact, we’re supporting a bill here in California to demand that people use headsets.

Are Europeans more advanced than Americans when it comes to the ways they use their cellphones? They certainly seemed to catch on to text messaging long before we did.

In that particular application, I would say that is accurate. I would not say that your perception of overall sophistication of usage is accurate. I think that that is a perception that exists, but I don’t think it’s necessarily true. For instance, we’re much more advanced here in the States with regard to e-mail usage on cellphones.

How is Palm responding to Motorola's Q?

Well, we’re making great products that people love to use. I think you’ll also find [with] the Q enormous return rates, people that are disappointed with its usability. The only thing we can do is focus on what we do best, which is simple, fast, reliable products that people love to use. Treo users are a real dedicated bunch. If you talk to them, they will tell you why they would rather carry our products than those.

We are clearly continuing to innovate, and developing new products. We never stop doing that, and you will see new products come out from us, before the end of the year, that we’re very excited about and will continue to put us in a very competitive position against all the competitors out there.

It’s not a winner-take-all game. We don’t have to vanquish Motorola or Nokia to be successful. We can have enormous success [with] this company while they continue to have success, and the same with RIM. So we really think as we look at our strategic options that the best opportunity is to execute against our plan, and that’s what we’re going to do.

Millions of people are now enslaved by their cellphones and handheld devices. Do you feel responsible for that?

No. I find it really funny —  do see people saying, "Oh, geez, this is a ball and chain for me." Or, "I feel like I’m constantly on." I think that’s all about personal responsibility and discipline. In fact, I think if you look at it from the positive side, these things allow you to be anywhere at any time and still be in control of your life. I find them to be incredibly liberating. I often say to people, "There is an off button."

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