Software Everywhere — David Beers on Mobile Computing

If you thought I was going to speculate on this morning's fresh acquisition rumor then I'm sorry to disappoint you. What gets me is the way this stuff gets propagated into the mainstream media outlets. Most people get news like "Palm Takeover Expected This Week" from the New York Times (registration required). The Times quotes the Unstrung.com article (the first link) which in turn quotes "sources." As if news of this kind from undisclosed sources means anything. The fact that the sources are said to be "close to the situation" is hardly something that contributes to their credibility. A major shareholder of PALM who would like to pump up the stock before unloading it is "close to the situation." So would be someone inside Palm itself that would like to see the shares rise enough that a takeover is averted. Talk about the tail wagging the dog! It's bad enough that Unstrung is reporting this as real news, but that it gets play on the New York Times is ludicrous. It makes me feel like I may as well listen to the voices inside my own head as read the Times! :-)

Updated Mar 25, 2007:

Palm's stock climbed steeply through the week as the baseless news of the imminent acquisition announcement spread around—then plummetted when the market opened on Friday, hours before the conference call when Palm was supposed to announce the "acquisition."

This has been said elsewhere, but if you're ever tempted to take stock market activity as evidence of anything important that a technology company or its rivals are up to you really should first familiarize yourself with the way hedge funds have transformed the market these days. Jim Cramer's Guide to Market Manipulation (registration required), also published in the Times, is a good place to start. Cramer is a fund manager himself and told TheStreet.com back in December that this is the standard MO that he and his colleagues use to ensure the market swings their way when they need it:

Say a hedge fund manager is holding a short position — a bet that a stock will decline — in Research in Motion, which has just announced blockbuster quarterly earnings results. An enterprising fund manager might call several brokerage houses and either feed them bad information or order a slew of short sales. Then he or she could call up a “bozo reporter” with a fake news tip about Resarch in Motion rival Palm.

The result, he says, is a perfect storm of bad news that temporarily lowers R.I.M.’s stock price, long enough for the manager to reap a tidy profit.

Interesting that Cramer chose Palm as his example in that interview back in December. It looks like someone ripped that play out of his book and followed it verbatim last week.

If you ask me, Palm is not going to be acquired any time soon. They have, however, been making some acquisitions of their own: $19M worth during the last quarter (see transcript here), including ChatterEmail earlier in the month. Since Motorola acquired Good Technologies, which was one of Palm's best push email partners, adding ChatterEmail's popular serverless push email technology to its products makes a lot of sense.