Shares of Palm Inc. went up 35 percent as investors welcomed the arrival of the company's new operating system and first new smartphone, according to a wire report.

Palm pre

Reuters said that Palm shares closed up $1.15, or 34.85 percent, at $4.45 on the long-awaited announcements.

Palm is now third behind RIM and Apple in the North American smartphone market for the third quarter, said Reuters, citing Gartner analyst Hugues de la Vergne.

Critics, bloggers, and analysts welcomed the new webOS and the Pre at Palm's New-ness event today at the Consumer Electronics Show in Las Vegas.

Both webOS and Pre were developed with help and direction from former Apple executive Jon Rubenstein, who is known for his role in the creation of the iconic iPod.

Palm first announced the development of its new operating system in 2007 but has been delayed until now.

The long delay resulted in Palm's fall from being the market leader to an also-ran, with Apple's iPhone, Research in Motion Ltd's BlackBerry and Windows Mobile devices already beating the ageing Treo line.

US CDMA network will be the exclusive distributor of the Pre, the first smartphone powered by the new webOS. It packs GPS technology, WIFI connectivity and a slide-out keyboard, among others.

The Pre starts shipping by June 2009. No pricing schemes were announced.

Reuters also said that Sprint shares rose over 8 percent, helped by the new exclusive contract with Palm.