O2 wins exclusive Palm Pre deal

Palm will next week confirm that it has signed a deal with O2 which will see the mobile phone network become the exclusive UK partner for its eagerly awaited Palm Pre handset.

The Pre, which went on sale in the US last month, has been tipped as the most viable alternative yet produced to the iPhone. The new version of the Apple device – the iPhone 3GS – went on sale less than two weeks ago and a million were snapped up in the first three days.

O2 already has an exclusive deal with Apple to stock the iPhone and grabbing the Palm Pre is likely to further cement its position as the UK’s largest mobile phone network. Reports of a tie-up between Palm and O2 first appeared in May and Carphone Warehouse is also expected to stock the Pre.

O2 is believed to have seen off fierce competition for the device from Orange, which it also beat to the iPhone at the last minute.

Analysts reckon that Palm has already sold more than 300,000 Pre devices in the US alone and the handset has a crucial role to play in reviving the company’s flagging fortunes.

After pioneering the handheld computer market in the 1990s with the Palm Pilot, the company’s move into the mobile phone business was scuppered by the arrival of the iPhone.

Earlier this year, Palm’s chairman, Jon Rubinstein, said that launching a hit device was the vital first step on the road to recovery. "We’ve been fighting the battle with basically both hands tied behind our back for the past year and half," he said. "Now we’re getting on the playing field, and we’re going to be extremely competitive. But it’s the beginning."

The Apple device sent many handset manufacturers back to the drawing board when it appeared two years ago. Since then a series of ‘me-too’ touchscreen devices have appeared, from the Nokia 5800 and Sony’s X-Series Walkman to the HTC Magic and T-Mobile’s G1. Business email device manufacturer RIM, meanwhile, has pushed hard into the consumer market with the Blackberry Storm.

The Palm Pre has received positive reviews since it launched in the US under an exclusive deal with Sprint. Its touchscreen has been compared favourably with that on the iPhone, while the Pre also has a full slide-out keyboard, making emails easier to type than on the Apple device.

But for many users the most striking difference between the iPhone and the Pre is the way in which the latter device charges: rather than being plugged in, it merely has to be placed on what Palm calls its "Touchstone" and charges through magnetic induction. O2 refused to comment.

via The Guardian