June 8 (Bloomberg) -- U.S. shoppers clamored for tight supplies of Palm Inc.’s Pre in its debut weekend, marking an early victory in the device’s bid to challenge the iPhone.

Sprint Nextel Corp., the Pre’s exclusive wireless carrier, ran out of inventory at some stores, putting customers on waiting lists. Sprint may have sold 45,000 to 100,000 of the phones this weekend, analysts said.

While that’s less than the original iPhone’s 270,000 sold in the 30 hours after it debuted in 2007, the Pre is helping restore Sunnyvale, California-based Palm’s reputation as a mobile-phone innovator. The touch-screen device also may slow the exodus of customers at Sprint, which has lost more than 4 million contract subscribers in the past year.

“There was certainly a lot more buzz about the iPhone than there was about the Pre” opening weekend, Stifel Nicolaus analyst Christopher King said. “The Pre is clearly going to be an underdog if it is a head-to-head battle.”

RBC analyst Mike Abramsky said 45,000 to 55,000 Pre phones were sold this weekend, with at least 80 percent going to current customers. Chris Larsen, a New York-based analyst at Piper Jaffray & Co. said as many as 100,000 may have been sold.

Sprint sold out of the Pre in many locations and is getting the device back into retail stores “as fast as Palm can make them,” the company said today in a statement.

James Fisher, a spokesman for the Overland Park, Kansas- based carrier, declined to specify how many phones were sold, how many locations ran out or when new shipments would arrive.

Applications

Pre customers downloaded 150,000 games and other applications the first day the device was available, Lynn Fox, a spokeswoman for Palm, said today in an interview.

The Pre supplements its touch screen with a slide-out keyboard, giving it a feature the iPhone lacks. The Pre’s operating system is designed to make switching between applications easier. The device also can combine calendars, contacts and messages from different accounts.

Palm shares have almost quadrupled this year in anticipation the Pre will be a hit. Today, the stock fell 84 cents, or 6.5 percent, to $12.16 at 4 p.m. New York time on the Nasdaq Stock Market. Sprint lost 15 cents, or 2.9 percent, to $4.96 and Apple dropped 82 cents to $143.85.

Buzz for a Day?

The Pre’s debut coincided with Apple’s annual developers’ conference. Cupertino, California-based Apple unveiled a new iPhone and operating system today and cut the price of the older iPhone 3G to $99.

Palm should have released the Pre earlier no matter how many units may have been ready, said Roger Entner, an analyst at Nielsen Co. in Boston who doesn’t own Palm shares.

“You’re able to build buzz for, what, a day?” said Entner. “And today or tomorrow all the headlines will be filled with Apple.”

Verizon Wireless, the largest U.S. wireless carrier, is introducing new phones as well, including new BlackBerrys and a model based on Google Inc.’s Android software.

Like the iPhone, the Pre synchronizes with Apple’s iTunes music store. The Pre’s $199 price, after a two-year contract and mail-in rebate, also matches the cost of the new, 16-gigabyte iPhone 3G S.

Sprint has exclusive rights to the Pre through at least the end of the year. Larger rivals Verizon Wireless and AT&T Inc. have said they’re interested in carrying the phone.

Chicago-area Sprint stores received 30 to 50 of the phones, said Jennifer Fritzsche, an analyst at Wachovia Securities Inc. Some locations expect to get new shipments by June 10, she said. One Best Buy Co. store in New York said it only received three devices.

Gave Up IPhone

Sprint’s store on Mission Street in San Francisco sold 60 Pre phones within two hours before running out, manager Daniel Chan said. The outlet started a waiting list and will get the next consignment in a few days, he said. About half the people who bought the Pre were iPhone owners, he said.

“So far, it is fantastic,” said Chris Lee, a 28-year-old architect from New York who bought the Pre the first day. “There are some similar features to the iPhone,” said Lee, who gave up his iPhone 3G after eight months of service with AT&T. “But it feels more fresh.”

Palm aims to win back customers for smart phones, a market it helped create, after losing ground to Apple and Research In Motion Ltd. Palm will probably post a third year of losses and declining sales, according to a Bloomberg survey of analysts.

In 2007, Palm hired former Apple executive Jon Rubinstein, who worked on the iPod, to create the Pre. Venture capital firm Elevation Partners invested $425 million in Palm to fund the Pre’s development. The firm owns about a third of the company.

Smart Phones

Smart phones represent a pocket of growth in the wireless industry. The devices made up 23 percent of U.S. phone sales last quarter, up from 17 percent a year earlier, according to research firm NPD Group Inc. in Port Washington, New York.

Smart phones also bring in more revenue for carriers, since customers pay extra for Web access, software applications and messaging.

Pre buyers are required to sign up for Sprint’s Simply Everything plan, which includes unlimited data and messaging for at least $69.99 a month. AT&T charges iPhone users the same amount without messaging, according to the company’s Web site. The Pre is also available through Best Buy, RadioShack Corp. and some outlets of Wal-Mart Stores Inc.

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

Last Updated: June 8, 2009 18:12 EDT