Palm Pre review: Finally, a worthy iPhone rival [video]

June 4, 2009, 3:55 PM UTC

[cnnmoney-video vid=/video/technology/2009/06/03/fortune.techmate.palmpre.fortune/]

This is Jon Fortt’s segment of a review done with Michael Copeland. For the full review including Copeland’s take, click here.

The Palm Pre is the second-best smartphone I’ve used. Its black plastic physical casing is attractive and feels well crafted. Its screen is bright and sharp. Its keyboard, though too cramped for comfortable one-handed typing, feels good and works well when attacked with two thumbs. And the software — the true test of any modern phone — is smooth and intuitive enough to challenge Apple’s iPhone.

Before I share details of my take on the Palm Pre, a little context: I was an avid Palm Treo user (and Sprint customer) for four years. It was a tough decision to leave the Treo, because we’d become friends. I knew its keyboard and its quirks. But after months of frustration with Sprint’s coverage and customer service, I got an iPhone three months ago.

After spending a few hours with the Pre, I wasn’t tempted to give up my iPhone. While the Pre is a very good device that matches the iPhone in many ways and even surpasses it in a few, the iPhone is still a better handset in the ways that matter to me — and in ways that I think will matter to a lot of potential buyers. Here’s how the two phones stacked up against each other:

Design. iPhone has the advantage. When it’s closed, the Pre looks like a smooth stone, fits easily into a pocket, and does so without extraneous buttons — there’s an on/off switch on top and a navigation button in front, and that’s it. Open it and there’s a small keyboard. Compared to the iPhone, the Pre feels lighter, more plastic and less luxurious. But it also feels durable enough that you might throw it into a pocket or purse without worrying about it getting scratched up. The Pre’s camera is better than the iPhone’s too, through many expect Apple to address that with new hardware and a software upgrade.

The Pre gets points for having a removable battery (which the iPhone lacks), and for its keyboard (a must for some heavy e-mailers). It falls short, though, in usability. The Pre is a little too slim and small to use comfortably with one hand, and the keyboard is so small and squat that one-handed typing is a painful affair. And the battery, while accessible, doesn’t last long — with WiFi on it seemed to drain more quickly than the iPhone.

Interface. It’s a tie. Palm deserves huge credit for giving the iPhone a run for its money in the usability department. It’s pretty easy to find what you’re looking for on the Pre, whether it’s e-mail, instant messaging, the web browser or the camera. The touch screen navigation is smooth, including a method of managing tasks that’s like working through a deck of cards – flick to the side to show a new window, flick up to discard it.

There are a couple of areas where the Pre outshines the iPhone. Its ability to run multiple programs at once — a talent the iPhone lacks — is probably the most hyped, but there are others. The way the Pre’s address book pulls down contacts from online sources like Google (GOOG) and Facebook is nifty, though it can cause duplicate entries for the same person; it similarly pulls info from online calendars. And its universal search function is a nice one-stop way to find information both on the device and the web.

But there are other aspects of the Pre’s interface that aren’t so great. The screen is too small to easily navigate through calendar information. And the screen size also becomes a problem on the web, where text is often too small to read without first zooming in.

Applications. Here the iPhone has the advantage. Apple has a store with tens of thousands of applications that iPhone and iPod users can download. Palm doesn’t. The availability of so many applications makes the iPhone a more useful tool. Whether you’re looking for a game, a database, or a Twitter client, you’ll have a better chance of getting a great one that works on the iPhone rather than the Pre.

It’s a bit early to criticize Palm too much for this, since the Pre is brand new. But the disparity in applications isn’t likely to even out anytime soon.

Why? Third-party software developers want to make back the money it costs to create their product, and to do that they need volume. When they’re deciding whether to make an app for the Pre versus. the iPhone, the BlackBerry or Android, they’ll want to see which is most likely to pay off. The iPhone and BlackBerry have sold millions of units already, so they’re in the lead. Android, which is backed by Google, hasn’t done nearly as well — but word is that more than a dozen Android phones will be out by the end of the year, expanding the potential market.

One ambitious mobile developer I spoke with last week said that even if developing for the Pre is easy, he’s focusing on the iPhone and Android for the foreseeable future — the Pre just isn’t worth it yet.

That means even if you’re one of the folks who likes the Pre’s features a bit better than the iPhone’s, you might have to do without some of the cooler mobile apps for a while. If that’s OK with you, the Pre is a very good choice. (AAPL) (RIMM) (MSFT) (GOOG) (S) (T) (VZ) (MOT) (PALM)