HP to end TouchPad and PC sales

**frenchtower** · August 19th, 2011 07:28 AM

[SIZE=4]HP kills TouchPad, looks to exit PC business[/SIZE]
By David Goldman *CNNMoneyTech August 18, 2011: 4:57 PM ET

Hewlett-Packard is taking a hatchet to its business and doing some radical restructuring.

The company said Thursday that it is looking to spin off its industry-leading but struggling personal computer business. HP also killed off the TouchPad tablet it launched last month, as well as its webOS smartphone line.

The move essentially leaves for dead the webOS software HP got by acquiring Palm last year, though the company said it will continue trying to "optimize the value" of its purchase. Though the move was unexpected, it's not all that surprising: Despite a huge marketing campaign, TouchPad sales struggled so much that HP almost immediately cut the tablet's price by $100. HP said none of its webOS products reached the company's internal sales targets.

HP also said it has agreed to buy British software developer Autonomy for roughly $10.2 billion in cash. At $42.11 per share, the purchase price represents a 58% premium over the company's average share price over the past month. Autonomy specializes in database search and other enterprise software technologies.

"We believe this bold action will squarely position HP in software and information to create the next-generation information platform, and thereby, create significant value for our shareholders," Apotheker said in a prepared statement.

HP's (HPQ, Fortune 500) stock swung wildly since the news first broke late Thursday morning. Shares had fallen by as much as 8% in early trading on Thursday. After Bloomberg's report, shares rebounded and shot up as high as 8% above Wednesday's closing price before falling back into negative territory.

The various moves are part of the company's stated goal of transitioning into faster-growing, more profitable businesses like software, servers and corporate technology services. But ditching its consumer businesses will come at a steep price: HP's Personal Systems unit accounts for about 1/3 of the company's annual revenue.

As a result of the transition and "challenges that we face across our businesses," HP reduced its full-year revenue forecast by 9%. It also lowered its profit forecast by 16%, though that dreadful number includes charges related to killing off its webOS products. Without those charges, HP still lowered its previous estimate by 4%.

The end of an era
The bold move to reshape HP -- the world's largest tech company by annual revenue -- would be in line with the strategic vision CEO Leo Apotheker unveiled in March.

In May, Apotheker told analysts on a conference call that the company needed to put greater investment into its "value-added services" or it will "be left with a business that is running out of steam."

Consumer PC sales have slumped industry-wide for the past several quarters, as tablets like Apple's (AAPL, Fortune 500) iPad have slowed netbook and mini-notebook sales. The trend has hit HP particularly hard: sales to consumers fell 23% between February and April.

But a move to sell off its PC unit would be a 180-degree turn for HP, which 10 years ago bought Compaq in an acrimonious deal that eventually helped cost then-CEO Carly Fiorina her job. That acquisition made HP the largest PC manufacturer in the world.

Despite its recent struggles, HP still sells more PCs than any other vendor, shipping 14.9 million PCs last quarter -- enough to give it control of 17.5% of the market, according to Gartner. Dell (DELL, Fortune 500) and Lenovo are in a near-tie for second place, each with more than a 12% share of the market and shipments in excess of 10 million units last quarter.

The company said its board of directors has authorized executives to explore "strategic alternatives" for its Personal Systems unit, including a full or partial spin-off or sale. HP said it plans on making a final decision on the division within the next 12 to 18 months In addition to PCs, that unit also makes some other consumer devices like mobile phones.

Apotheker has said that by placing greater emphasis on the company's fast-growing software and server businesses, HP can leverage those units to improve its slow-growing services division.

A deep dive into enterprise software would also take Apotheker back to his roots. He was previously the head of German software giant SAP

Somehow, it is bound to happen.
LINK

**chua_riwap** · August 19th, 2011 07:56 AM

so goodbye HP na.
iPAD kasi eh......

**marg** · August 19th, 2011 08:01 AM

Ang BILIS. One month lang Suko na?

**Monseratto** · August 19th, 2011 08:05 AM

Someone mentioned the iPad and tablets are just a fad...but it is killing the PC/notebook market slowly.

Consumer PC sales have slumped industry-wide for the past several quarters, as tablets like Apple's (AAPL, Fortune 500) iPad have slowed netbook and mini-notebook sales. The trend has hit HP particularly hard: sales to consumers fell 23% between February and April.

Lacklustre demand from consumers and market-share gains by Apple weighed on results, offsetting stronger spending on server computers. Among home computer shoppers, tablets and smartphones may have sapped demand for PCs.

Palm Pre used to be the darling phone, now it's dead in the water...

HP had launched its Pre smartphone as a competitor to the iPhone and devices based on Google's Android operating system.

However, webOS failed to gain traction with reviewers, operators and retailers.

The decision to ditch the Pre, as well as its TouchPad tablet computers, comes despite paying $1.2bn (£727m) last year to buy up the technology through its acquisition of Palm.

The move essentially leaves for dead the webOS software HP got by acquiring Palm last year, though the company said it will continue trying to "optimize the value" of its purchase. Though the move was unexpected, it's not all that surprising: Despite a huge marketing campaign, TouchPad sales struggled so much that HP almost immediately cut the tablet's price by $100. HP said none of its webOS products reached the company's internal sales targets.

**Monseratto** · August 20th, 2011 11:29 AM

Now if only a modder would be able to make this thing run on Android OS...

Well, that didn't take long. It's only been a day since HP announced its intention to discontinue production of webOS devices, and it looks like the outfit's already throwing its flagship tablet in the bargain bin. PreCentral reports that HP sent out a memo to its affiliates asking them to cut the price of the ill-fated TouchPad to $99 and $149 for the 16GB and 32GB editions, respectively. The date apparently put forward by HP is August 20th, but at least two Canadian retailers (Best Buy and Future Shop) have already made the cut -- though both outlets show the sale ending August 22nd. As proof that being fashionably late isn't always a good thing, the white 64GB edition has surfaced on HP's US site, sporting a $600 asking price, leaving us to wonder, well: why now? If all of that isn't enough to turn your smile upside down, webOSroundup is playing the bearer of bad rumors, with what they say is an internal memo from AT&T stating that the carrier's launch of the Pre 3 has been "completely cancelled."

**tidus1203** · August 20th, 2011 11:32 AM

HPQ stock is down 20% yesterday on this news... I am short HPQ stock, I am very bearish long term on this company... Its got no future pretty much. Just visit the WORLD ECONOMY TALK for my technical analysis on HPQ...

**Monseratto** · August 21st, 2011 11:51 AM

Fire Sale!!!

HP TouchPad fire sale spurs online sell out, brick-and-mortars may still carry stock (updated) -- Engadget

It's the same old story of genius recognized only after death, and thus is the fate of webOS. If you were amongst the opportunistic hordes scavenging the interwebs for last night's bargain bin $99 HP TouchPad announcement, chances are you're fresh outta luck. The L.A. Times is reporting widespread online store sell outs for the recently abandoned and heavily discounted 16GB and 32GB slates. While HP's own site and the biggie online retail outfits, like Circuit City and Walmart, have all but sold out of their web inventory, Amazon's third party sellers still have the tablets on offer -- just at non-discounted prices. Of course, you could always leave the hypnotic glow of your monitor and venture out into the real world where actual, physical stores are purported to have the tabs currently in stock. Try your luck, and let us know how things go in the comments below.

Update: We've been hearing reports that select Best Buy outlets have begun selling their remaining inventory as of this afternoon. Also, it appears RadioShack plans to get in on the discounted fun, as leaked internal memos indicate an impending price cut. If you haven't had any luck snagging one of HP's also-ran tabs, now's your chance.

**myk384** · August 21st, 2011 12:07 PM

Tablet PC's are a niche market. They are mini PC's but don't have full PC function. Pagdating sa name factor, mas lamang si Apple

**WeaponX** · August 21st, 2011 01:02 PM

Baka style ni IBM din gagawin. They will focus more with their Managed Services.

**Monseratto** · August 24th, 2011 10:35 AM

Hmmmm.....

HP TouchPad to run Android thanks to TouchDroid

HP TouchPad to run Android thanks to TouchDroid
Aug. 22, 2011 (1:45 pm) By: Russell Holly

By now, there’s a massive, yet unconfirmed, number of brand new owners of the HP TouchPad tablet. As you read this, thousands of apps are being installed, the UI played with, and the device as a whole is being re-judged. Compared to other tablets in the market, the TouchPad is still a major competitor when it comes to hardware, and yet it’s only $99 right now… if you can find one. So, they will continue to fly off the shelves until there are none left and the people at HP can move on with their lives.

What happens when that “new gadget smell” wears off, though? The honeymoon effect with your new, heavily-discounted device wears off and you’re left with a tablet that isn’t likely to get any better than it is right now unless you do something yourself. The Preware community already has a nice collection of things you can do to play with any WebOS device, but even that has its limits. So, what are you to do with that shiny new tablet? Well, eventually, you’ll be able to put Android on it.

RootzWiki, the Android-focused rooting, modding, and development forum has put together a small team dedicated towards assembling Android for the TouchPad, as well as performing the hacks necessary to shoehorn the OS on the device. The team has put forth a clear plan of attack and is documenting the process along the way using both the RootzWiki forum as well as a separate “TouchDroid” Wiki. Each of the team members purchased their own TouchPads, but also have a donation link available in case they brick one of their TouchPads, or if one needs to be the victim of a teardown for additional information.

Basically, they will attempt to put (stock) Android 2.3.5 from the Android Open Source Project on the device at first. If that succeeds, they will move in to CyanogenMod, a popular Android rom that has a full suite of tablet enhancements for large screens. When the next version of Android, Ice Cream Sandwich, becomes available, the team plans to port that to the TouchPad as well, provided Google sticks to their plan to release Source once again when that version comes out.

This attempt has garnered a mixed bag of responses from TouchPad users. There are those who would rather keep their stock WebOS experience still, though I refer you to the first paragraph for my opinion on that. There are those who welcome the Android port with open arms, and likely bought the tablet with that in mind from the beginning. While I am an Android user, I must say that I am a huge fan of the WebOS experience and have preferred it over Android for some time now.

I’m not the only one, apparently. James Kendrick recent wrote that what he would rather see happen is closer to what RIM has in store for the Playbook. Some sort of emulator to allow Android apps to run on the TouchPad, while still following the rules and multitasking principles of WebOS. I have to say, that idea excites me. I feel that solution would certainly be more elegant, and would preserve much of what we have come to appreciate from WebOS. I do know, however, that making that work is a great deal more difficult then just shoehorning Android onto the TouchPad. So while I am excited at the possibility, I will refrain from holding my breath.

Another notion that was raised was the possibility of seeing Windows 7 or Windows 8 on the tablet in the future. Essentially, if the TouchPad gets opened up for Android, the sky will be the limit for modders who want to push the limits of this device. So many things will be possible as long as there is an audience and developers interested in making the TouchPad do “all of the things.” If you have a TouchPad, keep your eyes on the RootzWiki guys, as they will most certainly be making noise about their developments regularly.