RUMOR: HP getting out of the PC business?

Discussion in 'HP' started by dave1812, Aug 18, 2011.

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  1. hockeymass

    hockeymass that one guy

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    Not really.
     
  2. linuxwanabe

    linuxwanabe Notebook Evangelist

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    There's been talk of a HP spin-off or break-up for quite some time, but it looks like the decision to dump the Touchpad and WebOS came straight from the board of directors, and by all appearances, the decision was made in hurry.

    When you think about it, WebOS wasn't just for tablets and phones, but was intended for every HP notebook and desktop - perhaps as "quick start" OS alongside Windows, but perhaps also as a sole OS to replace Windows, depending on the market segment. With WebOS gone, the phones and tablet were dead, but so was a major component of the conventional PC business.

    I don't know how well WebOS would have performed on a X86 processor, but it's clear that HP couldn't turn around its PC business just by turning out the same commoditized Windows PC. With WebOS gone, perhaps HP couldn't turn around its PC business at all, hence the death of WebOS being tied to the announcement of the general PC spin-off.

    HP getting out of the Windows PC market isn't all that important, since there are too many competing brands and one less doesn't matter, more or less.

    This is catastrophic news for Microsoft. If the HP board of directors doesn't envision Windows 8 as being sufficiently successful to keep the biggest Windows PC maker in the business, it speaks volumes about the future of Windows.
     
  3. Izagaia

    Izagaia Notebook Evangelist

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    I can't believe that HP would just sell-off their consumer products division? I mean,.. I "get" that it may actually happen. And that it may have been largely unprofitable for them to keep it on. What I don't get is how doing so and conceeding their portion of the market is going to make them more profitable. It doen't seem like the best thing to do when you are the top manufacturer to just give your client-base away. I am kind of leaning towards the "spin-off and creating a new company" theory. You just don't tell your customers: "sorry, we are nolonger in the business - but you can buy from our competitors".

    I once read an article explaining that HP intended on putting WebOS onto every new notebook and desktop PC it sold. Instead they sort of gradually tried to feed to their customers with a limited product line and then didn't really do anything with it. IMO, they should have just included it with those purchases (new notebooks and desktops) as a freebie along side Windows. Let customers discover for themselves. Seems it would have reached more people that way. I dunno...
     
  4. pianowizard

    pianowizard Notebook Evangelist

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    The whole thing seems very bizzare. I don't understand why HP would want to make this announcement so prematurely. Why not wait until after they have made up their mind as to how to "spin off" the PC division? That way, investors and the general public wouldn't have to speculate wildly and freak out, like they are doing right now.
     
  5. linuxwanabe

    linuxwanabe Notebook Evangelist

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    HP planned a 2012 roll-out for WebOS on x86 PCs - and it seems quite likely that WebOS wasn't sufficiently developed as a desktop OS for an earlier rollout. Personally, I would have been far more interested in WebOS if it had been FOSS, but there again, I don't see all that much interest in the Chromium OS? So even if WebOS had worked out x86, at best it would have been HP's equivalent to Google's Chrome OS, and we all know how little interest consumers have in Chromebooks. About as much as the Touchpad, before the $99 liquidation.

    The bottom line that HP was probably breaking even on the PC division, even taking into consideration the typically accounting shenanigans. It wasn't a money loser, although looking at the entire Windows PC industry, the future prospects were poor.

    Right now, it's hard to imagine any serious bidders for the PC division, and if you consider the meaning of the term "spin-off," it might simply be a matter of giving each HP shareholder shares in a new standalone HP PC company. Have one HP share, get one HP PC share. The other option is to attempt an IPO, which seem ridiculous considering the economy and the stink from the Touchpad liquidation. There were rumors of splitting up HP and selling off the remains to Private Equities, but again, the Touchpad debacle makes that seem unlikely. Finally, there's the possibility of HP simply taking a huge writedown and shutting down the entire PC division. If HP could use the writedown against past, current or future corporate tax obligtations, this option could make the most sense. I don't think anyone would pay $10-12 billion in cash for HP's PC division, although if HP could offset that much in corporate taxes, it might make sense to shut the whole division down for good.
     
  6. Pseudorandom

    Pseudorandom Notebook Evangelist

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    1. The situation is a bit different, I'll accept that, but HP, like IBM is going nowhere anytime soon. There really shouldn't be any fear about honoring of warranties on business machines.

    2. What? Maybe Small Businesses, maybe executives who don't follow the advice of their IT staff, but Apple isn't in the enterprise at all.

    3. There is Thinkpad, Latitude, and Elitebooks. Yes, Toughbooks and Tecras exist, but no where near the big three.
     
  7. APasserBy

    APasserBy Notebook Enthusiast

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    I've operating profit at anything from 13% from an MSNBC article that was pulled to ~5% (Microsoft Explorer : Rumors of HP's Death are Ridiculously Exaggerated)

    By comparison, HP's printer group pulled in a 14.7% operating profit for the last fiscal quarter.
     
  8. pianowizard

    pianowizard Notebook Evangelist

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    That's the best article I have seen about HP's announcement. It clarifies lots of the misunderstandings and rumors.

    BTW, I read somewhere that Dell's profit margin is even lower, like 2.6%. If that figure doesn't go up soon, I won't expect Dell's PC division to be around for much longer. Ten years from now, the only remaining PC makers will probably be Acer (Taiwanese), Apple (U.S.), Asus (Taiwanese), and Lenovo (Chinese). Sony, Samsung, Toshiba and Panasonic can make a lot more money by selling other products.
     
  9. trentbg

    trentbg Notebook Consultant

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    And what was the stock back than over $50 and now....almost under $20...sooo, your argument is invalid!
     
  10. jihe

    jihe Notebook Enthusiast

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    Probably because apple is more expensive. When you are given a choice of free notebooks, you would choose the most expensive one.
     
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