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Palm Pre Debut Kicks Off Smartphone Smackdown

The Palm Pre will debut a week from tomorrow with a beta version of the company's smartphone app store along with iTunes and Twitter features that analysts say help position the Pre as the closest iPhone contender to date.

Leading up the June unveiling, Palm (NASDAQ: PALM) yesterday unveiled some signature features of the webOS platform including Palm media sync that works with iTunes, the integration of Twitter in universal search and a beta version of its App Catalog.

The App Catalog, the company's answer to the iPhone App Store, will include applications from Fandango, Pandora, Handmark, FlightView and several other companies, and will offer Pre owners a glimpse of how the overall webOS ecosystem will work.

On the digital media front, the Pre, Palm reports, will synchronize with iTunes to transfer DRM-free music, photos and videos to the handset. Once the phone is connected to a computer via the USB cable and "media sync" is selected on the Pre, iTunes launches on the computer desktop so media files can be transferred.

In addition to listening to music transferred from a computer desktop, Pre owners can use the on-device Amazon MP3 store to purchase individual songs or full albums over-the-air. Searches can be done by artist, song and genre, and preview and purchase music files. You can then download purchased tracks when you're connected to a Wi-Fi network.

In terms of search functionality, the webOS integrated universal search lets users find information on the Pre by typing on the home screen. From there, the Pre's universal search scans the Web through Google, Wikipedia and Twitter.

News of the key webOS features come at a time when competitors are enhancing their operating systems and gearing up for signature product launches in an effort to capitalize on the lucrative smartphone market, which is posting gains amid a wider slump in handset sales.

Research In Motion (NASDAQ: RIMM) just finished tweaking the BlackBerry operating system to support touchscreens and speedier browsing. A BlackBerry Storm 2 is on tap for summer release, while Google's (NASDAQ: GOOG) open source mobile operating system Android just rolled out its first significant upgrade, dubbed Cupcake, with version 2 on the way. Samsung, HTC and Motorola are expected to put Android phones on the market this year. Microsoft is also prepping updates to its Windows Mobile software.

Meanwhile, Apple (NASDAQ: AAPL) is poised to release iPhone OS version 3.0, with a slew of enhancements and perhaps a new iPhone model days after the Pre launch.

Add to the mix the race to catch Apple in terms of smartphone app success -- the iPhone app Store recently surpassed 1 billion downloads -- and the summer smartphone smackdown is shaping up to be a sizzler.

Given the competition and fact that the very fate of Palm relies on the success of the Pre, all eyes are on the new device, which analysts and developers are now saying appears to be emerging as a viable competitor, if not a threat, to the iconic iPhone.

"Palm is smart about including iTunes sync as Apple iPod users have a music alternative. I believe the most significant issues in regard to challenging the iPhone are how well the touch interface and UI work," Bill Ho, mobile analyst at Current Analysis, told InternetNews.com.. "Many people will invariably be drawn to that first and foremost. Having seen it in action, I think the Pre is the closest iPhone contender to date."

Meanwhile, Ken Dulaney, mobile analyst at Gartner, is less optimistic, questioning the app store progress and logistics and citing carrier issues. "I was disappointed that there was no news about the app store being completed. Also, I don't like the fact that Palm is running it. It's going to take a lot of money," Dulaney told InternetNews.com..

While pleased overall with the news so far, Dulaney thinks Palm needs more than AT&T's backing. "The features announced are good solid features, but I don't think the Pre is a competitor to the iPhone yet. It only runs at Sprint. And few will move to that network from AT&T just for the phone. The iPhone is good enough to keep people at AT&T. And it will be upgraded soon. However the Palm Pre has done some good solid things to make sure the product is well received and we believe it will do well there," he said.

Indeed, Sprint today announced it has an exclusive deal to carry the Pre until the end of 2009, after Verizon Wireless CEO Lowell McAdam said yesterday at conference that his company would start selling the Pre by the end of the year.

Ho said the news of Pre moving over to Verizon at some point will help sales. "The short answer is yes, it is good for Palm. If you think about where Palm is in the market, at the bottom, they need to maximize their products across all carriers to make a comeback. It stands to reason that there will be a GSM/HSPA version in the future to attack the global market. For Sprint,going into Pre negotiations, they had to know Palm's position and having some sort of lock for a period of time is still a good thing," said Ho.

Ho added that this behavior among industry players is no different than any other 'hero' device available at a carrier for a length of time before hitting the market elsewhere. "Take a look back at the BlacBerry Pearl -- it was at T-Mobile for a length of time and then it moved onto other carriers. The anomaly to this model is clearly Apple. Apple is a strong brand that could dictate what it wanted because the iPhone was so revolutionary and AT&T execs 'got it' right away. So Sprint (and every other carrier) will continue to seek out compelling 'hero' devices that give them the same type of competitive advantage."