$299 Palm Centro: Australia’s cheapest smartphone?

You remember Palm. The company reinvented the PDA with the original Pilot (later PalmPilot and then just Palm) in 1996 rescuing it from the ridicule of the Newton and five years later – through the work of offshoot Handspring – helped light the touchpaper on the smartphone revolution.

It’s also the company that faced struggles of operatic if not soap operatic proportions. There was the dot-com blowout of 2000-2001 which was stock prices plummet from US$95 to US$6 in barely a year (today they still trade at just US$5.50). The highly praised OS was spun off (into PalmSource)and then sold off (to Japanese firm ACCESS) after which Palm cosied up to long-time enemy Microsoft as a licensee of Windows Mobile. Last year private-equity firm Elevation Partners (co-founded by U2’s Bono) purchased a 25% stake in the company.

Beneath those blips on the corporate ECG Palm managed to churn out several impressive products mainly in its Treo smartphone range but the increasingly competitive market seemed to move faster than the company could keep up. It didn’t help that the Palm OS itself was almost stagnating with the last major release being Palm OS 5.0 in late 2002.

Yet Palm seems to have finally bounced back with a bang incredulously based on a smartphone built around that same years-old OS. The trick is that Palm is going after the entry-level market comprised of first-time smartphone buyers and it’s cooked up the Centro to have a spec set and price point to match.

That’s been enough to sell over one million devices in the past nine months mainly in the US where the Centro has been offered through carriers Sprint and AT&T for a low US$99 on a two-year contract. In the UK and Europe it’s available unlocked for £199 ($410) and €299 ($490) outright.

The deal available to Australian buyers from this week is even sweeter: $299 through Telstra pre-paid although you’ll have to fork out a $50 unlock fee in order to switch over to any other carrier. There’s no contract – you just need to keep your phone account topped up with voice and data credits beyond the $10 which comes with the phone using Telstra’s ‘browsing packs’ which start at $5 for 5MB of data.

Because the Centro runs on Telstra’s GSM Edge network rather than Next G you shouldn’t expect to be doing a lot of downloading but you’d still want a little extra data up your sleeve for handy online services like Google Maps plus of course email especially where attachments are involved (although you can set the Centro’s mail client to retrieve only subject lines or limit messages to a certain size.

So what do you get for your $299. Quite a lot frankly. The overall mix is pretty familiar to anyone who’s used a Palm device in the past few years because as we mentioned earlier the OS has remained largely unchanged. That makes it a sheer delight when you’re used to the likes of Windows Mobile thanks to the elegant Zen-like simplicity of the Palm OS and a punchy little 312MHz XScale processor.

Beyond the standard phone and PIM features you get treats like a threaded chat-style interface for SMS exchanges and support for ISP-based POP and IMAP email as well as Exchange ActiveSyc for push email plus wireless calendar and contact synchronisation. Documents to Go Professional 10.0 lets you read edit and create Word Excel and PowerPoint documents including the XML-based OpenDoc files of Office 2007 as well as read PDF files.

The bundled Pocket Tunes 4.0 plays MP3 WMA AAC and Ogg Vorbis files and syncs against Windows Media Player with support for album art. Native video playback is limited to supporting video clips taken with the 1.3 megapixel camera plus mobile-friendly 3GP clips the free and open-source Core Pocket Media Player is a quick fix for getting video onto the 5cm 320×320 panel – it’ll handle just about any format you throw at it including DivX XviD H.264 MPEG AVI QuickTime and Matroska. Multimedia content can be stored on high-capacity microSDHC cards.

The most serious criticism could be levelled against the keyboard which is so tiny and cramped that you’ll more likely rely on the stylus and touchscreen for tapping out everything from phone numbers to email and SMS messages.

All up this is a pretty appealing package for anyone making their move from a mobile phone to a smartphone although there’s no doubt the imminent local arrival of the iPhone will keep Palm on its toes – especially if Apple opts to bring in an updated and cheaper GSM iPhone alongside the 3G model. Stranger things have happened…

During last week’s media launch of the Centro we took the chance to catch up with Palm co-founder and CEO Ed Colligan and chat about the company’s current and future device line-up work on their next-gen OS and a possible return for the much-maligned Foleo. Click here for an insight into the Palm of 2008 and beyond.