updated 07:50 pm EDT, Tue October 11, 2011
New HP CEO may keep PCs in-house after all
New HP CEO Meg Whitman's accelerated review of the fate of its PC business may see her change her mind, insiders detailed Tuesday. Advisors on the subject have told the new executive that the costs of breaking out the group into a separate company might be more than the cost savings, the WSJ heard. Shedding the PC business would hurt HP's ability to get low prices on its remaining hardware and would cut into the profits of what was left.
No decision has been made so far on the business, they said. Whitman has only said so far that she wanted to have a decision made by the end of October. A decision on what to do with webOS hardware and software, if any change, also hasn't been mentioned.
HP itself hasn't confirmed any details.
A decision to keep the PC business would be a reversal of the course that Whitman had mentioned just hours after taking over from fired CEO Leo Apotheker. She triggered confusion when she planned to maintain Apotheker's plans despite many presuming that his decisions on PCs and mobile were the very reasons he was forced out. He had contended that the sudden departures were necessary as the iPad was making business untenable, although many have interpreted his real aim as trying to recreate the services-only business he knew from his earlier post at SAP.
If HP keeps its PC business, it's likely to disappoint rival computer makers like Apple and Dell. A separated HP PC division wouldn't have had the brand identity or financial safety net it does now, giving others a chance to dethrone HP from its current lead.