Today’s Wall Street Journal has an article entitled, “Palm’s Pre Smart Phone Fails to Stem Deep Losses.” The article goes on to describe the Palm’s quarterly loss has quadrupled since the launch of the much-touted Pre on June 6. Revenues are down, profits are down.

But how much of this is attributed to the phone itself, which has been lauded as an “iPhone killer,” versus the partner that Palm chose to dance with on the network provider side? This is a classic case service design example of the symbiotic relationship between products and services. From our vantage point, Palm’s problem is not the Pre product, but the Sprint Nextel network, which is suffering from massive customer flight due to spotty coverage, dropped calls and bad customer service.

As a long-time (and happy) Verizon customer, I have been jonesing for the Palm Pre ever since I saw it in Las Vegas last January at the Consumer Electronics Show. Add into the mix that I am also a long-time (and happy) Palm Inc, customer who started on the old Palm Pilot handheld organizer, moved up into the Treo family of smartphones and is now happily using a Palm Centro. And even though I’m happy I STILL want a Pre. But I will not buy it until Verizon has it. (This is probably also the number one reason I don’t have an iPhone – even though I am Mac everywhere else in my life – you can only get an iPhone via AT&T, another inferior network to Verizon.)

Call me old fashioned, or just call me loyal. But Verizon has always done right be me when it comes to mobile communications and that service relationship is the stake in the ground around which my product decisions are made. This is a key insight of service design that product folks often don’t get: it’s more about the service “eco-system” than it is about individual features of a product.

When is this insanity going to stop? Imagine if you bought a Chevrolet and you could only put Sunoco gas into it. In Europe, the phone networks are independent of the handsets so that consumers are free to combine their favorites. Until the U.S. adopts the same model,  I just have to hope that Palm hangs in there long enough for me to get a Pre on the Verizon network. Please, Santa…