Peter Burrows at BizWeek has some hot news about Palm’s new OS, Nova. The company hopes to fit their new system in the gap between the BlackBerry and the iPhone (good luck – Microsoft has been trying to do that all year) and they are looking to grab 2% of the middle-range market shere, the range that Google/Android is also gunning for.

“If they can’t show me a large, active audience, I’m not going to be interested,” says Jeff Holden, CEO of Web 2.0 company Pelago, maker of a social networking tool for the iPhone. “At this point in the game, you’re toast unless you have something completely unbelievable.”

Not a lot of specs available right now but it should be available by Q2 2009 and the company hired 150 engineers to work on the new system. Dales are down 50%, Palm has laid off 10% of their workforce. Analysts are bullish, though.

“Palm going to zero would be bad for me as an analyst, but it’s not going to hurt T. Rowe Price,” Eiswert says. “But if it works, the upside is tremendous.”

The key word in that sentence is, obviously, “if.”

Incidentally, Palm, “Nova?” Those who don’t learn from history are doomed to repeat it.