Palm Gets Rubinstein

Elevation Partners is buying 25% of Palm for $325 Million, and John Rubinstein, the now famous Apple executive who brought the iPod to life, and ran Apple’s iPod division until recently, will join as Executive Chairman. The deal also brings Elevation founders Roger McNamee and Fred Anderson (former CFO of Apple) onto the Board of Palm.

My analysis of the recently released Foleo says that the Linux laptop direction, and the aspirations of becoming a convergence device, are on the mark directionally.

What I see lacking in Palm’s new direction is a strong marketing leader, one who can successfully combat Apple’s PR and Advertising machine. Satjiv Chahil has been long gone. While finding one to match Steve Jobs’ genius will be tough, in my opinion, the weakness of Palm remains in its lack of a marketing visionary. Without this person, the iPhone competition will be a formidable wall to break through. Will Bono step in?

The second missing piece on the team is a Software visionary. As Steve Jobs said over and again at his D interview last week, that Apple is a software company. And that is exactly what Palm has not been : a software company, which they really needed to be. Going forward, this will become incredibly important. Rubenstein is a manufacturing / hardware guy, and will not be able to plug this gap so easily.

Finally, a few words on Elevation. Is this Palm acquisition a result of Fred Anderson’s recently aroused vendetta against Jobs, who has tried to throw him to the wolves on the Options scandal? Bono and McNamee, long-time Jobs allies, are going along with it, though, as is Rubinstein, who will soon discover that Jobs will make it very difficult to recruit anyone of significance out of Apple, something that all executives look to do when they take a new gig.

On the positive side, Elevation’s strong suite is Content. Perhaps, Palm’s strategy going forward will embrace Content in a way that will be unique and interesting, and breathe new life into the company.

Most of the media is writing Palm off at this point. I guess, I have a bit more patience, and am curious to see what they do with a market disruption as big as the iPhone, which will open things up again, in 2 rather stagnated markets : laptops and handsets.