Editorial: HP and the post PC World

By Gadjo Cardenas Sevilla

The news today that HP was cutting off webOS and possibly shifting away entirely from the PC market was monumental for a number of reasons. Ending its pursuit of the smartphone and tablet market a mere month after it launched the TouchPad, shows that HP is very aware of where it stands in this immensely competitive space. Putting the brakes on its PC business, where it has long loomed as a giant gives us an insight of how it sees the industry and where it is going. 

Shooting down an underperforming mobile division a month after a global launch is a gutsy and brave move. It takes a lot to try and sell the world on a great idea and then go right back and say, "y'know what, we were wrong. Screw it, we're done."

This may have some negative effects in the short term but HP showed that it is willing to sacrifice its image today to ensure it succeeds tomorrow. We should have known things were brewing when former Palm honcho Jon Rubinstein was moved out of position. That and CEO's Leo Apotheker's insistence that they want to go into services and solutions for business (an area he is very familiar with from his days at SAP AG) prompted this shift.

Right now, HP seems to be heading in the same direction IBM did when it sold off its PC business to Lenovo. Focusing on software, cloud services and business solutions takes HP out of the current milieu of a hyper competitive PC market that's now all about the race to the bottom in terms of pricing.

With ASUS, MSI and Acer bringing cheap yet competitive models in the low end to midrange, Samsung, Sony, Lenovo and Dell stretching out the middle to high end and Apple apparently thriving in the high end yet constantly lowering prices with each new iteration of its notebooks and desktops, HP seems to be having a hard time competing.

In the mobile space, HP's place was even more ambiguous. Believe it or not, the time it took for Palm to transition to HP took  webOS out of the conversation. Android exploded and even the Johnny come lately attempt of Microsoft Windows Phone proved to be a more exciting prospect for users seeking alternatives to the iOS and Android.

I sensed something was wrong when the TouchPad launched in July. No formal press event was held to introduce the device. There were some select blogger parties where units were given away but this did little to show the public at large what the device could do. It was almost as if HP knew then that things were not going well.

Still, we remained hopeful that the innovative webOS  system would thrive.  We liked what it brought to the smartphone space and felt that it would make a natural transition to tablets. We believed HP could really forge a formidable ecosystem but even HP could not eke out a future for the OS.

This opens up an incredible opportunity for Microsoft which is in a good position to challenge RIM and slowly inch up to Android in the coming months. Pricing, model mix and public information are what is needed to help promote Windows Phone.

As for HP, well they have been around a long time. Few companies survive this long without taking calculated risks and understanding the ebb and flow of the trends of the day.

They do have an opportunity to leverage the Palm intellectual property and the sizeable patent portfolio as well as the name and reputation of the company that defined the PDA and invented the smartphone.

As fans of Palm, we hope that this means the brand and its products may somehow live again.