Treo Pro unlocked in bid to lower costs

Two very different tales are circulating about Palm Inc. and its new Treo Pro smart phone these days.

One story, from Palm and some analysts, is that the new Treo Pro’s unlocked feature offers a cost-effective way for international business travelers to dramatically lower roaming costs. Travelers can insert a SIM card into the Pro from the carrier in the country they’re in, potentially cutting those costs by 90%, Palm officials said.

The other story, from a different group of analysts in recent weeks, is that Palm had to unlock the phone because it could not find a carrier willing to sell it. One analyst went further, saying that the inability to find a carrier to sell the Treo Pro is a sign that the troubled Palm is facing its ultimate demise.

“Palm loses a major distribution channel and any subsidy by not going through the carrier,” Gartner Inc. analyst Phillip Redman said via e-mail today. Having to sell the smart phone unlocked “looks like the final death sigh” for Palm and follows years of struggles finding effective products to sell fending off financial difficulties, he said.

The new smart phone sells for $549, a premium price compared to the Apple Inc. iPhone 3G and some other competitors. The higher price is largely because the upfront hardware cost isn’t offset by the guarantee of monthly service charges.

Mike Adamine, senior product manager for the Treo Pro at Palm, said Palm decided to unlock the device because business customers wanted to avoid draconian roaming costs when traveling. Palm’s decision to include a SIM card slot for various carriers means IT managers can help users cut roaming costs that easily reach $500 a month for a single user who travels through two or three countries.

“There’s already been a lot of demand for unlocked,” Adamine said.

Wasik Malik, director of mobile solutions at the Ohio State University Medical Center in Columbus, Ohio, said the prospect of an unlocked device interests him. He has been testing a Treo Pro for three months before deciding whether to purchase more than 600 for use by medical students and residents in the fall of 2009.

“Unlocked is important to us because we cannot bind ourselves with a single vendor for data and phone service,” he said.

In general, Malik said he looks for a single device that has voice and data capabilities for young doctors who might otherwise need to carry a phone separate from an online medical reference database. “Smart phones are becoming cheaper and our goal is to give the students one device instead of having six things in their pockets,” he said.

More than 80 medical students at the school this year are using the iPhone , although the medical department constantly reviews devices for future deployment, Malik said.

Another feature in the Pro is a simple switch to turn on Wi-Fi usage. By comparison, the iPhone will search for Wi-Fi service continually, burning up battery power, unless a user turns off that feature, Adamine said.

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