HTC to buy out Palm? Rumors abound

With the weak sales of both the Pre and the Pixi, Palm is hurting. They’re looking for bids, possibly as early as this week, according to sources familiar with Palm’s situation. Among the companies showing interest are Lenovo and HTC. What could this mean for HTC? Well, it may just give them the patents they need to fight the Apple lawsuit that they are currently facing. Palm, who has been in the mobile phone and handheld device game for a long time, and has built up a nice portfolio of patents during that time, some of which may be key in helping HTC win the upcoming battle against Apple.

Jon Rubinstein, CEO of Palm, worked at Apple and developed the iPod. He was the head of the iPod division until March 31, 2006, when he retired. He then joined Palm in 2007, working to create an “iPhone killer.” He played a key role in developing both WebOS and the Pre, both of which debuted in January of 2009, at CES. Just a few days after the launch of the Pre in June of 2009, Rubinstein was announced as CEO of Palm. During this entire process, Apple never raised a complaint against Palm, presumably because Palm has a large enough patent portfolio that they could countersue, making a legal battle futile.

Acquiring this patent portfolio could give HTC the edge it needs to win the Apple lawsuit, along with giving them enough new patents that they could improve their phones. It could also allow WebOS to grow, potentially becoming a solid competitor in the smartphone world. Coupled with the great hardware that HTC can make, the appeal of WebOS could grow, no longer dependent upon the two phones that it is currently on. An international release could also be possible, giving WebOS the potential to reach an entirely new set of customers.

This could also mean a shift in HTC’s strategy, and instead of just producing hardware, they could also get into the software game, combining their excellent SenseUI with WebOS (which could ultimately set up an excellent user experience), and great hardware. Also, since HTC has a phone on pretty much every major carrier, they could have a solid chance at really getting serious in the smartphone game, and could compete with Apple and RIM.

Overall, this could be an excellent opportunity for HTC, and it will surely be interesting to see how it plays out.

Sources: Gizmodo, Bloomberg, Wikipedia