Should Palm and the others come out with an iPod Touch Rival?

Palm, RIM, Nokia and some others have come out with mobile operating systems of their own. They are all focusing on phones. And no points for guessing who their chief rival is – yeah, Apple.

Apple came out with some numbers at their recent Rock and Roll event. They have sold 30 million iPhones. But guess what. They have also sold 20 million iPod Touches. That gives them 50 million devices to sell those apps and services to. Each time Apple comes out with a software update, they charge the touch users to upgrade their OS. Out of the 1.3 billion downloads that have happened on the app store, we can easily assume 40% from the iPod Touch.

We all know now that the game’s focus has shifted to apps and services (music, video, etc). So what should these other mobile companies do to capitalize on the investment made on their OS? Churn out new phones? No. Well, that and think about this other market that Apple has so nicely tapped – mobile devices like the touch.

I am not sure what the folks at Palm and RIM are thinking (why did Palm have to release the pixie?), but it seems that time is ripe to take a look at this market as well. I mean, what does it take to create a music player out of the current phone? Just strip out the phone! Everything else should be (more or less) in place.

The incremental cost of adding this new product in the market should be much lower. The product is already there. The distribution channel is already out there. Just a marketing push should be enough to get their consumers’ attention…what do you say Palm?