It's looking ugly at Palm, whose new smartphones at Verizon Wireless -- the Pre Plus and Pixi Plus -- are off to a slow start. Shares are down 5% today after getting downgraded by Bank of America/Merrill Lynch and MacQuarie Research.

As MarketWatch reports:

"Palm was cut to an underperform -- or sell -- rating by Bank of America/Merrill Lynch. In a note to clients, analyst Vivek Arya said the company's newest webOS phones have seen 'sluggish' sales since the Verizon sales began."

"In another report, Phil Cusick of MacQuarie Research cut his rating on the stock to neutral, or hold. Cusick also cited 'weak sell-though' at Verizon , and noted that interest from other carriers such as AT&T is weak."

The main problem for Palm is that the smartphone market has become a platform game, which means there are only going to be 2 or 3 big winners. So far, in the U.S. at least, RIM's BlackBerry and Apple's iPhone are the top 2, and Google's Android is making a strong push to be no. 3, with increasing support from all four major U.S. wireless carriers.

While Palm has a technically impressive platform, there's a lot more factors than technical quality in who will win: It also includes carrier distribution, hardware design, marketing, app quantity and quality, commerce, entertainment and media services, etc. And so far, Palm is not making it happen.