SM: So services as a key strategic initiative you think is still in beta! EB: Well, this was a core opportunity. In the Spring of 2005, at an annual strategy board meeting, it was decided that a key goal for the company would be in the subscription area. We had not been able to execute on this. It took a toll. It became clear we could not introduce new products and services to the market.
This is why it felt like the company was in deeper malaise at the end of 2006. We seriously looked at all of the options available to the company. We looked at many different options and a lot of these are summarized in the proxy document mailed to shareholders a few weeks ago. Nobody shared the same mindset in terms of what to do. We seriously considered selling to a larger player, and we had opportunities.
SM: Can you discuss that? EB: No, I can’t discuss it because it has not been disclosed yet. At sometime in the future I can add some color to this. Our filings describe what we did. I headed up the special committee to look up the alternatives, and with the help of our investment banker we went through the series of alternatives available to the company. Eventually we ended up focusing on the one that is currently being put to vote which is a sort of partial privatization, free capitalization of the company with the private equity firm, Elevation Partners.
Elevation has really smart partners who understand this business really well. These are folks like Fred Anderson. Folks who come out of the industry and who understand the Palm business for quite some time. They knew that with operational execution and the injection of innovative talent, the company could do far better. They understood that quite well. We came to an agreement that they would take a very substantial stake in the company and get involved at the board level. Fred Anderson, who was the CFO of Apple, and let me emphasize that he was a broad scope CFO during the turnaround of Apple, will join the Board. Basically, Fred is someone who managed to get Apple to deliver on its earnings stream and commitments.