O2 have slashed the price on the Palm Pre - reducing the overall cost of the cheapest Pre tariff by £99. Which is all well and good, especially as it now includes three EA games, however I don't see that as the sort of incentive that will tempt buyers from the iPhone, Android or Windows Mobile.
The Pre is in real trouble right now, its selection of applications is limited, its only available from one network and its competition is getting stronger by the day, with new Android phones arriving in April (the X10 range, Nexus and its HTC half-brothers); Apple due to announce the fourth generation iPhone this summer and Windows Phone 7 Series arriving this year. Palm has little to offer by comparison and its bet on WebOS seems to be failing - and badly. Once again the company has announced another quarter of losses and you have to wonder just how much cash they have left to burn through.
In order to survive Palm has two options as far as I can see: Android or Microsoft. The former shouldn't be a difficult switch, the core platforms of WebOS and Android are similarly Linux based; whilst Palm has had some history of working with Microsoft in the past so should be able to build on what was once a positive relationship for the company. Perhaps the way forward is to follow some other brands and draw from both pools. Their devices will have to get a lot more competitive if they're to compete in the Android market though. However there is a niche for an Android-powered Pixi if Palm are quick, there's no candy-bar Android phone that currently sports a front mounted QWERTY...
Persevering with WebOS looks to be a dead end street and Palm now has a limited time to turn their car around. But do they have the will and personnel to do it?