With PalmSource in disarray following the abrupt departure of CEO David Nagel, there is growing speculation the company will be acquired. An obvious candidate is PalmOne, a move that will reunite the software side of the Palm eco-system with the hardware. That said, PalmOne's intentions seem fuzzy after it took control of the Palm brand today by purchasing PalmSource's 55% stake in Palm Trademark Holding Co. for $30-million. It may suggest PalmOne's next move is acquiring PalmSource, or it may indicate PalmOne has what it values most - the Palm brand name - and it has little interest in the software business. Another intriguing rumor is that Research in Motion may be interested in acquiring PalmSource as it attempts to become an "wireless applications platform" rather than simply the company that makes cool Blackberry e-mail devices. As it now stands, RIM is a one-trick pony no matter how much management contends otherwise. This isn't a bad thing given the strong growth of the wireless e-mail market. RIM, however, is smart enough to realize there is plenty of mobile e-mail competition on the horizon, and it must diversify. PalmSource would give RIM access to the Palm OS and a large library of applications, which would address a major hole in RIM's product portfolio. The Deal suggests RIM could pay as much as $225 million for PalmSource - a 40% premium to its current market cap. While RIM has the cash to make a deal, the question is whether it wants to adopt a new OS. In many ways, the acquisition of PalmSource makes sense because it would be relatively inexpensive given RIM's large war chest, and it would give RIM credibility when it wants to talk about becoming an wireless application platform.

Not that it should surprise anyone but the Firefox community's efforts to spread the word now include online commercials. Firefox evangelist Tristan Nitot commissioned three a French viral agency to create three ads, which show people using Firefox for the first time. The video clips, which are designed to be e-mailed to friends, have been viewed nearly two millions times this month. While it's amusing to see the Firefox community step it up, the real test will come when IE 7 is ready for prime time. With enhanced anti-virus protection and tabbed browsing, the big question will be whether Firefox can maintain its momentum. In other words, can it take the leap from 50 million downloads to 100 million, and can it move from 6% or so of the browser market to 10%? At 10%, corporate users may have to sit up and take notice that there is an alternative out there. Then again, you wonder have many CIOs and CTOs are ready to adopt an open-souce browser, even though many of them are using Linux on their Web servers.

Skype took another step forward with the formal launch of its affiliate program that rewards Web sites for helping the company attract more users. During a keynote speech to VON Europe, Skype CEO Niklas Zennstrom said Web sites can receive a commission of to 10% for promoting Skype. The program, managed by Commission Junction, already had more than 1,800 affiliates sign up during a test run. The first group of "super" affiliates includes 192.com, Firstream, SpyMac and MyFamily.com. The affiliate program suggests Skype's transition from a free P2P telephony service to telecom company with revenue is happening quickly. While the company does not release financial numbers, it is clear that SkypeIn and SkypeOut have become widely-used and lucrative. Another revenue source could be SkypeSee, a video-conferencing service now in beta.
On another front, it will be interesting to see how Skype addresses 911 service and how regulators deal wity Skype. If you try to use Skype to make a 911 call, this message pops up: "You cannot use Skype to many any emergency calls". During its days as a pure P2P service, there was no question Skype stood above the 911 fray. But now that it's becoming a more "traditional" telephony service, it can only a matter of time before regulators start to examine whether Skype needs to offer 911. In Canada, Skype was not included in the mandatory 911 edict because it does not offer Canadian telephone numbers.