While the PalmOS future appears to be bleak, Palm itself is doing something interesting with its adoption of Windows Mobile for a version of the next Treo, with Symbian UIQ likely to come next. I was especially heartened by Microsoft's comments that Palm negotiated several changes to software and requirements to make their device look like a Palm. Of course, we should expect Microsoft to incorporate any transferrable Palm ideas and putting them in the next set of device requirements and software.
Honestly, I expect the device will look like it came from the Handspring design team, not the Palm design team (within the larger constraints of Windows Mobile SmartPhone). Palm devices (i.e., those by Palm outside the Treo line) have been somewhat uninspiring for the past several years. My LifeDrive, for example, has many of the same physical characteristics as the Treo 600/650, but the software is not well integrated for thumb or 5-way rocker use. They took some of the lessons from the Treo but not all (hey, isn't that what Microsoft does?)
So, based on recent reports, it looks like Palm's core competency, the design of mobile devices' user experience, is being preserved. This is good since they had to purchase it back from Handspring. They don't appear to have the ability to build quality hardware, particularly the radio components, if recent quality reports and lawsuits have any merit. Certainly the radio on my Treo failed.
So what is the future of Palm?
As an independent device manufacturer with no inside track for any operating system, their weaknesses in marketing and quality spell a further downward spiral. After all, other companies can and do make devices with good user experience. Their divorce from PalmOS the company is likely to cause that OS to become less relevant in more developed markets, so they don't have an inside track there.
As an acquisition target, however, Palm is very interesting. What if they found a company who could make and distribute smartphones, had good relationships with the carriers, but who didn't have a (Western) brand identity? I'm talking particularly about the Asian device manufacturers, particularly Samsung, Sanyo, and LG. Samsung, for example, will make a device with any operating system that's out there, and does not have a strong design identity. LG is struggling to get out of Samsung's shadow. Sanyo makes very high quality devices, but is too accustomed to the Japanese strong-carrier business model to have much of an identity.
Palm's strengths could complement the strengths of one of these Asian manufacturers.