It feels as if HP has conceded victory to Apple after just a few weeks of battle. As MG Siegler writes, the message seems to be ‘HP To Apple: You Win’.
Was this result inevitable? Was this the best decision and should we praise the company for its good analysis of the situation and its quick response?
If we consider the survey conducted by Robert W. Baird in the US regarding customers’ interest in tablets where iPad was the overwhelming winner - 94.5% cited the iPad as their main device of interest, followed by the HP Touch with 10.5% and the playbook with 3.8% - maybe this was the best decision. Possibly, Apple’s lead is too great and the right decision is to stop throwing good money after bad and start re-assessing their strategy.
At the same time, the HP Touch was the second device of interest. It’s main competitor, even if with a much smaller mindshare, has just left the market… But the device has only been out for a few weeks and with a less-than-stellar marketing campaign. HP had set-out to fight a giant and should have expected the process to be difficult.
In any case, it is done, and now the focus is on selling out the existing inventory with ‘fire sales’ where the prices have come down as low as $99. And they are selling like hot cakes!
Now the focus needs to be on:
1) What is next for HP? At the same time that Apotheker is lessening the company’s reliance on PCs, tablets and phones to distance it from consumer demand dependency, he is focusing the business in software and services for enterprise customers, including expansion of their cloud services.
Their first move in this direction has been to acquire ($11.7bn) Autonomy Corporation, a Cambridge-based UK company specialized in un-structured data search, that is, searching data that is not in the form of spreadsheets or word documents, such as e-mails, music, video or posts on social networks such as Facebook. Autonomy is the UK’s second-largest software maker with a large list of customers including Coca-Cola Co., the S.E.C. and Nestle SA.
This is a world that Apotheker knows well and where he feel comfortable. He may be able to make the best out of HP’s existing and new assets to promote growth and increase profitability.
2) What is next for webOS? It was, and maybe it still can be, a credible alternative to Android and iOS and, don’t forget that a number of Google’s OEM partners may be a bit shaken up after Google’s acquisition of Motorola and would like to have solid alternatives at hand.
With this in mind, out of the three alternatives they have – sell it, keep it open source or license it – the best move for HP might be to fill the gap that Google has just left open. It may not earn them back the $1.2bn spent on Palm or give them the #1 or #2 spot in the mobile platform wards but it is a solution that would allow HP to save face and give OEMs and developers a third worthy platform on which to work. And, with a bit of time, it may become the third platform of choice ahead Windows Phone 7.
And, by the way, what do you think Google is making of this?