Palm introduced the Treo 680 smart phone targeted to students, moms and other consumers who might have balked at a smart phone's regular price of $300 or more. The Treo 680 is expected to sell for under $200.
Unlike previous models that were silver, black or some combination of the two, the new Treo will come in four colors, crimson, copper, arctic and graphite, with easier-to-use icons. Initially, the Treo 680 will be offered with a Yahoo music bundle and a 30-day free-service trial.
The company tried a similar two-prong approach with its Palm Pilot line of personal digital assistants, offering the Tungsten for business users and selling the Zire for about $90 in mass-market stores. Palm's sales of hand-held computers have been declining; in the fiscal first quarter, it reported sales of 490,000 hand-held devices, down from 597,000 the previous year.
Palm, however, is bullish on the future, citing analysts' predictions that by 2011 as much as a quarter of all wireless handsets worldwide will be smart phones.
The company conducted a quiet, unconventional review for the business and did not look at creative nor did it critique work, executives familiar with the situation said. Rather, the focus was on "how the world would look in 2010" and to "get inside the heads" of the agencies, said an executive familiar with the process.
Palm was the last full-service client of Citron Haligman Bedecarre before it morphed into AKQA, an internet-focused shop that also works on accounts from Visa and Microsoft's Xbox.
Palm spent $7 million last year in measured media in support of the Treo, and $2 million the first two months of this year, according to TNS Media Intelligence.
Executives from Palm and Y&R did not return calls by deadline.