June 4 (Bloomberg) -- Palm Inc., the phone maker whose shares have quadrupled in anticipation of the release of the Pre, may have buyers waiting six months for their favorite games after keeping software development details under wraps.

The touch-screen handset uses Sunnyvale, California-based Palm’s new WebOS operating software. Without program specifications, designers such as PopCap Games Inc., the maker of top-rated mobile games “Peggle” and “Bejeweled 2,” can’t modify their offerings ahead of the device’s June 6 debut.

“If they really want to make it a competitor to the iPhone, I would think that they would want to have as rich and as wide a variety of types of products available,” said Andrew Stein, PopCap’s director of mobile business development. “Peggle,” where players try to clear the screen of pegs with help from unicorns and aliens, was among the top 10 applications for Apple Inc.’s iPhone in its first two weeks out.

PopCap, based in Seattle, also makes “Bejeweled 2” for Apple’s App Store, which started with more than 500 applications when it opened last July. It would take PopCap about six months to develop an application for the Pre, the company said.

The App Store now has more than 35,000 games, weather forecasters, shopping guides and digital books. Without that kind of library, Palm’s Pre may not have as much appeal as it might with a large number of applications, said marketing consultant Laura Ries.

Cool Isn’t Enough

“What has made the iPhone, I believe, into the huge success that it is, is the applications -- the applications are what people are so excited about,” said Ries, president of Ries & Ries in Atlanta. “If I have a cool phone, great, but if I can’t do anything with it, I’m not going to be a happy customer.”

Palm rose $1.15, or 9.2 percent, to $13.64 at 4 p.m. New York time in Nasdaq Stock Market trading, boosted by positive reviews for the Pre today. Overland Park, Kansas-based Sprint Nextel Corp., the Pre’s exclusive U.S. carrier, gained 18 cents to $5.03 on the New York Stock Exchange. Apple increased $2.79 to $143.74, while rival Research In Motion Ltd. added $1.53 to $82.01. Apple has risen 68 percent this year, and RIM has more than doubled.

Palm had kept the developer tools under wraps to all programmers except those chosen to help test them. The company has since expanded that pool of developers, allowing would-be application makers to apply for permission to view the kit. Hundreds now have access, spokeswoman Leslie Letts said, declining to say when Palm will make the kit widely available.

Handheld Pioneer

Palm, which became a pioneer in handheld devices with the Palm Pilot more than a decade ago, plans to sell the Pre exclusively through Sprint in the U.S. at least through the end of the year.

The Pre will go on sale with about 18 applications available in its App Catalog, including programs from the Pandora music player, movie-ticket service Fandango and a digital version of the checker-stacking game “Connect Four,” Letts said.

Some popular games may not make it to the Pre at all. The creator of “StickWars,” where you defend a kingdom against invading armies of stick figures, said he’s not willing to put in the extra effort to redesign the game if it’s not going to make any money back. The game is the third-most popular paid application in Apple’s library.

Wait and See

“I would need a real direct incentive in order to be willing to once again commit months of my evenings and weekends behind a computer screen coding,” said Eric Hartzog, who created the game as a student at Duke University in Durham, North Carolina.

Designing for the iPhone was easier because other developers shared resources in free online libraries, said 22- year-old Hartzog, who has since graduated and joined the U.S. Navy. He said he would only consider doing the same for the Pre if its popularity reaches the level of Apple’s phone.

Tiny Pictures Inc. Chief Executive Officer John Poisson, whose 14-member team has created photo applications for Waterloo, Ontario-based RIM’s BlackBerry, plans to see how the Pre fares before he commits. Once the San Francisco-based company decides to build an application, it will take his team about three weeks to complete, he said.

“We didn’t see a lot of value in being really early,” he said. “It remains to be seen how successful that device will be.”

Getting Hooked

Addictive applications, such as digital books, games and brain teasers, can often be enough to prevent customers from switching wireless companies, Wachovia Securities Inc. analyst Jennifer Fritzsche said. Sprint, which has lost more than 4 million contract customers in the past year, has until the end of 2009 to get subscribers hooked.

“The more dependent you are on that app, the less likely you are to change carriers,” said Fritzsche, who is based in Chicago and advises investors to hang on to Sprint shares. “It becomes even more important when you have an exclusive handset.”

Verizon Wireless, the largest U.S. mobile company, said it plans to carry the Pre early next year. No. 2 wireless carrier AT&T Inc. also has expressed interest in the device. Palm may ship 1 million Pre phones this year, Deutsche Bank analyst Jonathan Goldberg said.

Finding Fault

Reviewers have pointed to the minimal App Catalog as one of the few flaws with the phone, even as they praise the WebOS platform. The Wall Street Journal’s Walter Mossberg called the selection “the Pre’s biggest disadvantage,” and said that downloading one program crashed the device.

Ultimately, the WebOS platform will make it easier for developers to create applications, according to the companies with which Palm has shared program specifications. The platform uses language familiar to Web site developers rather than specialized rules, so it’s not as difficult to find programmers with the right skills.

Pandora’s Chief Technology Officer Tom Conrad became convinced after he watched a Palm employee demonstrate the phone for the first time. The device’s battery life and audio capabilities allayed his fears about the new operating system, said Conrad, whose company is based in Oakland, California.

Still, until developers can get their hands on the specifications, they can’t begin working on programs. And with more than 1 billion downloads since it opened in July, Cupertino, California-based Apple’s store may be too far ahead for Palm to catch, Sanford C. Bernstein analyst Craig Moffett said.

Sales of mobile programs may exceed $25 billion industrywide by 2014, with games being the largest category, according to Juniper Research in Basingstoke, England.

“There’s a very real risk here that the apps game has already largely been won,” said New York-based Moffett. “There’s a case to be made that Apple has already reached a fundamentally different orbit.”

To contact the reporter on this story: Amy Thomson in New York at athomson6@bloomberg.net

Last Updated: June 4, 2009 16:22 EDT