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AAPL Stock: 121.99 ( -1 )

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HP abandons webOS smartphones, tablets; may shift PC group

updated 03:45 pm EDT, Thu August 18, 2011

Confirms possibility of spinning off PC group

The TouchPad tablet and other webOS-based devices will be discontinued, HP has unexpectedly announced. The company has also confirmed earlier rumors, noting that is indeed negotiating to buy software maker Autonomy, and may also spin off the Personal Systems Group. The PSG controls HP's signature PC business.

The TouchPad in particular has been floundering, having possibility sold a few as 25,000 out of 270,000 units delivered to Best Buy. Last week HP dropped its price by $100, even as a new model, the TouchPad Go, appeared at the FCC. The webOS-based Pre 3 smartphone, meanwhile, has yet to launch outside of Europe. HP paid approximately $1.8 billion to buy webOS' creator, Palm, in 2009.

The Personal Systems Group generates about $41 billion for HP annually. The company is believed to be following in IBM's footsteps, however, and wanting to concentrate more on services. Despite high revenue, HP earns comparatively little profit from PCs.




by MacNN Staff

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Comments

  1. BigMac2

    Joined: Dec 1969

    +8

    That was quick

    HP have been real quick to pull the plug on its tablet. Too bad, I was considering WebOS one of iOS contender.

  1. rvhernandez

    Joined: Dec 1969

    +6

    Wow

    That's just all I have to say! I had to look at the calendar to make sure it wasn't "April Fools".

  1. facebook_Paul

    Via Facebook

    Joined: Aug 2011

    +2

    HP will sell Palm IP to highest bidder?

    This makes sense if HP thinks they can sell the crucial Palm Intellectual Property patents to the highest bidder.

    In the current client, they stand to make way more from the IP than from the products themselves.

  1. Rezzz

    Joined: Dec 1969

    +3

    Marketing Campaign

    All those lost millions during prime time TV. A swift kick to the nads.

  1. lamewing

    Joined: Dec 1969

    +4

    Advertising

    I must have hear 5 adverts on the radio for the Touchpad just this morning. I guess they haven't gotten the memo yet!

  1. climacs

    Joined: Dec 1969

    0

    if the markets weren't tanking today

    this news should have led to a modest bump up in AAPL and is potentially great news for the continued dominance of iOS products. Although TP was not even a mosquito bite compared to iPad sales (and so its departure from the marketplace won't help all that much selling incrementally more iPads), HP's departure sends a strong sign to competitors that maybe they should consider throwing in the towel as well, that perhaps they are simply not going to survive the iPad/iPhone juggernaut. It re-confirms, as well, in the minds of consumers that there's iPad and there's everything else... some of which may not be around for very long after you buy one of those wannabes.

  1. Bobfozz

    Joined: Dec 1969

    -3

    HP Services

    Makes you wonder if HP couldn't pull it off in the tablet field, the Air field, who would want their services with a "crack" outfit like that??

  1. climacs

    Joined: Dec 1969

    +2

    because...

    the competencies required to sell hardware to consumers are different (though somewhat related) than those required to sell hardware to businesses, which in turn are different than those required to provide services to business.

    I wouldn't buy a printer or computer from HP (though the monitor I bought 2 years ago is pretty nice). Someone passed down to me a combo scanner/printer... the software sucks and HP really rapes you on the cartridges. I only use it to scan. My mother has an HP Pavilion laptop that's a real P.O.S.

  1. jdsonice@gmail.com

    Joined: Dec 1969

    +4

    HP Services = EDS

    HP purchased their PC business by taking over Compaq (remember Carly baby) and then brought EDS to bolster its services business and now HP=EDS will be true. I guess Carly was wrong after all. The Compaq purchase (as was WebOS) was a mistake. They should have stuck to their core UNIX and Storage business.

    I guess they will still have some manufacturing i.e. the printer and consumables plus there UNIX business.

    Looks like the the services business is going to get crowded and soon HP, IBM, CSC, blah blah will be competing against each other and when they can't find people or when their CEO's feel they are not getting a big enough bonus they will layoff and hire overseas. Watch for HP to start advocating increased H1-B visa numbers.

    More layoffs and misery on its way for IT.

  1. JBytes

    Joined: Dec 1969

    +13

    More Proof

    I'm still waiting for someone to show me this tablet market which I often read about. People do not want a tablet; they want an iPad.

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