UPDATE 1-CES-AT&T plans 2 Palm phones, 5 Android phones

Wed Jan 6, 2010 4:25pm EST

* Palm shares up over 6 pct on news AT&T will sell phones

* AT&T also eyes Android phones from Motorola, Dell, HTC

* AT&T apps based on Qualcomm's Brew for cheaper phones

(Adds executive quote, analyst comment, share prices)

By Sinead Carew

LAS VEGAS, Jan 6 (Reuters) - AT&T Inc (T.N) plans to sell seven new smartphones in the first half of this year, including two phones from Palm Inc PALM.O and five Android phones from vendors, including handset newcomer Dell Inc DELL.O.

The announcement, made on the sidelines of the Consumer Electronics Show, helped lift Palm shares 6 percent. Palm is trying to regain ground lost to Apple Inc's (AAPL.O) iPhone and others and currently only sells its hottest phones at Sprint Nextel Corp (S.N), the number 3 U.S. mobile service.

The planned Android phones from Motorola Inc MOT.N and HTC Corp (2498.TW), as well as Dell, will mark the first time AT&T, the second-biggest U.S. mobile provider, will use the operating system developed by Google Inc (GOOG.O).

The news comes amid speculation that AT&T could this year lose its exclusive contract to carry the iPhone in the United States.

Michael Gartenberg, an analyst with consulting group Interpret, said it was unusual for AT&T to announce so many smartphones all at once.

"One has to wonder if the time of their iPhone exclusivity is coming to an end and if they're doing this to prepare for that eventuality," he said.

AT&T declined to give details about the devices, saying that would come closer to launch.

"I think this is the best portfolio we've ever had if you look at 2010," AT&T's mobile chief Ralph de la Vega told Reuters on Wednesday at an AT&T developer conference on the sidelines of CES in Las Vegas.

De la Vega declined to say whether the Palm webOS phones AT&T will sell are new devices or Palm's existing Pre and Pixi phones.

Dell said AT&T will carry a smartphone from its Mini 3 family, already available in China and Brazil. [ID:nN06151381]

De la Vega also said AT&T plans to offer Web-based applications to users of less advanced phones by forging a deal with Qualcomm Inc (QCOM.O) for use of its Brew app platform.

He said the first of these applications would be available first in phones from Samsung Electronics Co Ltd (005930.KS) later this year. AT&T sees the majority of its mid-range phones supporting Brew next year.

Palm shares rose 6.45 percent to close at $11.23, while AT&T shares were down 1.46 percent at $27.61 and Dell shares were down 1.95 percent at $14.58. (Reporting by Sinead Carew; additional reporting by Gabriel Madway; editing by Tiffany Wu and Andre Grenon)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.