AKQA, MEDIA Magazine's Interactive Agency of the Year for 2005, will hold the Palm account through the end of the year and then hand it off to Y&R's San Francisco office, said a Palm spokesperson.
Representatives for Y&R had no comment, but several people familiar with the review said the client was planning to broaden its marketing mix and up its spending, and felt a full-service agency would better serve its long-term needs.
A Palm spokesperson alluded as much, saying: "[Palm] wants an agency to look beyond 2010 in terms of capabilities, and we believe that Y&R is an agency that cannot only serve us tomorrow but for many years to come for the right mix of advertising."
In addition, Palm's Vice President of Marketing Page Murray will soon be leaving the company, clearing the way for a new executive and a new agency.
In its press release, Palm was uncommonly gracious for a client parting with an agency, noting the firm's many awards and praising AKQA "for seven years of innovative advertising...which helped catapult Palm to greater prominence [and] helped Palm retain its leadership in handheld computing against bigger competitors with more resources..."
AKQA's CEO Tom Bedecarre was equally effusive about Palm. "We loved working with Palm and had a very strong run for seven years. I'm a devoted Treo user myself, and we wish them a lot of luck. Let's face it--the number one reason people change is because new people want new teams."
The new agency decision comes as Palm launches its first smart phone aimed at the general public instead of corporations, the Treo 680. Ironically, the day before Palm announced its account move, AKQA's new $25 million campaign for Palm was highlighted in a Wall Street Journal article about the 680.