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The battle to secure the European exclusive for the upcoming Palm Pre smartphone is reportedly hotting up, with Telefonica said to be fighting off frontrunner Vodafone and also T-Mobile. But while the public relations value of a bidding war is powerful, Palm needs to start generating revenues from its make-or-break device, yet still remains worryingly silent on the date of its launch with US exclusive partner Sprint Nextel.

Vodafone was widely expected to be the European launch partner for Pre, since the company has been stepping up its efforts to challenge the iPhone with high profile handsets, and has the widest market coverage. However, Vodafone famously refuses to bow to stringent vendor terms - as when it turned down an iPhone deal - and has recently put its strongest efforts behind phones into which it contributed co-development effort, like the RIM Storm and HTC Magic.

If Vodafone bows out, Palm is likely to sign several exclusives, since no other carrier has the same European coverage, or launch in some territories non-exclusively. T-Mobile and Telefonica are both said to be in talks, although the agreement that is on the table for the latter, would apply to the Spanish giant's Latin American markets as well as, potentially, its cellcos in Spain, the UK, Ireland and Germany. A deal for Latin America would be a major coup for the Pre - Telefonica has near blanket coverage under its Movistar brand, and mobile internet usage is growing rapidly in countries like Brazil and Argentina. Since most countries in the region use the 850MHz and 1.9GHz bands, also used in north America, it would be likely that the Pre would support these as well as 2.1GHz.

Bidding wars bring valuable profile and public relations points, but these are less important than actually getting the handset out of the door, and analysts are getting nervous that there are last minute hitches in making the Pre launch-ready for Sprint. Although the operator ran a promotional webcast for the device this week, it still remained silent on pricing or launch date, though the window of its exclusive deal is narrowing. It seems that the phone will appear towards the end of the promised launch period - 'the first half of the year'. Any later would be serious both for Palm, whose revenues are currently being hit hard by the hiatus period as it waits for Pre contributions to kick in; and Sprint, which badly needs a star handset to try to stem the tide of customer defections.

Sprint only said that there would be an applications store, and that the device would be offered with the 'Ready Now' scheme, which runs from $69 a month, and the 'Simply Everything' unlimited voice/data plan, from $99. No word on the upfront cost of the handset to go with those plans though.

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