Is a $99 Palm ‘Eos’ in the Works to Challenge Apple?

The Palm Pre may have just debuted at $199 (after rebate), but a cheaper, smaller Palm smartphone may be just around the corner. According to Mike Abramsky, an analyst for RBC Capital Markets, Palm will launch its $99 Pixie — or perhaps it’ll be named the Eos — as early as Q4 2009.

Rumors of the Pixie/EOS have been circulating for months, and some reports predict the phone will resemble the popular Palm Centro with a touchscreen and a physical keyboard. A shrunken version of the Pre is unlikely, however, without some major design changes. In her review of the Pre, PC World’s Ginny Miles praised the phone’s interface and touchscreen, but was less than thrilled with its physical keyboard:

“Unfortunately, Palm seems to have sacrificed keyboard usability in the interest of compactness. While I appreciated having a physical keyboard, I disliked the design . . .The keys weren’t too tiny for my small hands, but some of my colleagues found them quite cramped.”

Another option for a future Pre: Palm could ditch the slide-out keyboard and replace it with a touchscreen version, a la the Apple iPhone. (Today’s Pre lacks a touch keyboard.) Certainly, the Pre’s best feature is its webOS operating system, which Palm will likely port to other Web-enabled devices next year, Abramsky believes.

Whatever Palm has up its sleeve, it definitely needs a webOS-enabled smartphone to compete with the iPhone 3G. Aggressively priced at $99 and featuring Apple’s slick iPhone 3.0 software update, the 3G is arguably the best smartphone value on the market today.

Go to jbertolucci.blogspot.com for links to Jeff Bertolucci’s PC World blog posts.