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Fiorina Says HP May Get Out Of The PC Business
Mikelgan writes: "Interex (the global HP user's group) is reporting that HP CEO Carly Fiorina told USA Today that HP may get out of the PC business altogether if the merger with Compaq fails. Here's the story."
...HP is considering dropping computers all together and start a bathing suit factory in portugal.
:-)))
soup
HP, quo vadis?
I thought the general consensus is that if the merger fails that she will booted out.
While Compaq is trying to improve itself for the merger, it seems that HP's only game plan is the merger. Now that's some real corporate foresight!
Bah... I want Carly Fiona to experience some pain for what she did to the HP calc division.
That sounds rather disapointing. HP has finally started to make some decent PC's and now they want to leave. :-( I think they should stick to it and keep making the nice systems they have finally figured out. Of course... thats just my $.02
Behold for I am not Gandalf the Grey whom you betrayed. I am Gandalf the White who has returned from death.
Compaq is ever strong on the PC Market and HP only can compute on the desktop market for corporations. Not the best market for PCs, on a time of economy crisis.
A few weeks ago I sent to / a proposal of news post , rejected, guessing that this merge could not succeedd. It seems I was guessing right.
Next time I buy a lottery ticket.
------I can please only one person per day. Today is not your day. Tomorrow isn't looking good either.------
So what are they going to do now? Maybe they should take a page out of the Enron book and start serving pr0n for playboy or penthouse.
Thoughts on tech, Software Engineering, and stuff
From my vantage point as an IT application manager, a merger between HP and Compaq sits well.
I'm not really interested in either company these days. Compaq basically destroyed itself and the companies it purchased. HP is doing the same to itself.
Their products aren't attractive to me (although both offer a couple cool products), and I have no reason to trust any service offerings offered by HP, Compaq, or a combination of both.
I particularly have to laugh at their consumer line of PCs, with the clear colored plastic which is supposed to make them "cute" like an iMac. Not even close.
So as far as I care, it's up to the shareholders. I guess the choice is to have one big sucky company, or two big sucky companies.
HP getting out of the business leaves very few PC makers left in the retail market. You'll be left with Compaq, Gateway (at their stores), Apple (in both Retail and their own stores), and Sony (in 'select' stores).
Dell is still all mail order and with IBM and Toshiba beginning to transition what's left of their PC lineups over to web based orders as well, customers will walk into CompUSA, Sears, or Circuit City and will face themselves with two choices: Compaq or Apple?
I think this is a good decision by HP. They make a killing off of printers and cartridges, as well as scanners and other peripherals. With margins in the PC market severely low (unless you're Apple), this could be a good move for them.
Was it all her doing when the Unix guys got the boot and HP calcs had no more future? Now HP PC's?
So they'll just be relying on the good old quality test and measurement dept then? No wait hang on, that's gone too is'nt it?
Stupid bitch, when is SHE going to get deprecated?
War crimes, torture, lies, illegal spying... Would someone give Bush a blowjob, already, so he can be impeached?
This seems to be yet another spin control move. This is not what she said or has been saying. I know, it's hard to believe that the press can misquote or be swayed by a spin meister but at least in this case it would seem to be true. From the inside this whole thing has been really wierd... and kinda fun.
In a time of universal lies, Telling the Truth is a revolutionary act - George Orwell
...With or without Compaq. That business is so large and it moves so fast that there's no way a combined HP/COMPAQ merger could keep up with it and still make a reasonable profit.
The real money is in support contracts for server software, and PC clients. IBM has already figured this out. It will be interesting to see if these folks can make a niche for themselves as IBM has.
Nearly fifty percent of all graduates come from the bottom half of the class!
Where will both of the customers go?
Would you, or anyone else, know how HP's PC division is doing financially?
HP used to be a company that made good test equipment, sold it at the highest prices, and supported it very well (also at the highest price). Now that's been spun off to the bizarrely named Agilent, leaving HP with the low-margin PC's and printers. The trouble with making PC's is that the market is very price competitive -- you've got to cut prices to just above cost to sell anything. Maybe you can make it up in volume. Or maybe you let your expenses get a teeny bit too high, and you're losing money every time you make a sale.
Just wondering how HP weathered that change, from a "don't just do things right, do them better at any cost" culture to low-margin commodity manufacturing?
Would that also mean no more HP notebooks? That would be a real shame! I own a HP Omnibook 6000 and it's one hell of a notebook. You want one. Trust me. :)
I love it when powerful women like you talk dirty to me. If I come over tonight, would you please tie me up and fuck me hard in the ass!
Too bad about this, HP was making some pretty good PCs, well supported too- and affordable. They were good PCs for ma or whoever to own, heck I've even had one - just a little hard to upgrade very much.
Hope they still make notebooks though! I'm typing this on a Pavilion N5270 which I've always been very happy with!
Compaq's not so bad but it sucks not having HP around anymore!
printers and scanners ?
once one of the best R&D companies of the planet reduced to a mere peripheral manufacturer is not a god thing.
this Fiorina chick is realy screwing the company. I was trying to sell my HP48G, but now I'll keep it for the sake of the good old times.
What ? Me, worry ?
Printers? Scanners?
Good luck Fiorina... I learned long ago that HP wasn't the only game in town providing these products. To my suprise, other products are better.
I guess there are still millions of PC owners who only know Staples, Best Buy and Circuit City [etc] for their computing needs.
Well, they always have their faulty CDRW products.
Get your Unix fortune now!
Did anyone else see the Red Herring 'Open Letter' (not yet online, got the dead tree yesterday), saying "Quit Carly Quit" in no uncertain terms?
HP. HP had a powerful business. 'Scopes, testing equipment, laser printers, calculators. People paid for that brand name. Like IBM, no one ever got fired for buying a LaserJet.
Guess what, those days are *GONE* and gone for good. I blame Fiorina, and a lot of other folks do to.
they might as well kiss some of their largest customers goodbye. I know that my company is planning on purchasing about 100K new pc workstations over the next two years. They are also killing off MPE, which accounts for about 600 $250K and up systems that are going to be coming end of life in two years. I would suspect that without PC workstations, it would be better for us to package deal with IBM for workstations and AIX servers instead of only having HP her with HP-UX. I think HP would be wise to give Fiorina the boot. She has wrecked that company.
Can someone please explain to me what she gained by allowing that to print? I already know what she lost -- she lost all the companies considering moving to her PC product. HP life cycle for machine types is great, and they do a fine job of keeping an image alive across machine types. I just don't see why she would allow that to print if they are not 100% sure that HP PC's are done for.
The merger is her 'child' she will not let anything happen to it. She would go under with its failure anyway. So I think that these comments are made deliberately so it will seem as 'lesser evil' to do the merger and silence some opposing voices.
If programs would be read like poetry, most programmers would be Vogons.
I saw a great picture in the NYT of the founders probably 50 something years back tinkering on some piece of machinery. These guys are legends and it would be a shame to see them go under. I hope they can right the ship.
-- You see, there would be these conclusions that you could jump to
The Hewlett family(i do believe) was fighting against the merger. She is saying this to make the Hewlett family back down, and let the merger pass, or loose the PC market... it's her hail mary pass.
I sold my circa 1993 HP-48GX for $130 on e-bay! 10 years old, and the calc could still outperform anything TI threw at it. How about that! Of course, the new HP-49G is about the same calculator as the 48GX (same processor?), just with more RAM. HP will still be producing it, just no more after this one. Bad move, but look at it this way. HP's calcs were the best for the professionals that new how to use them. The general public would look at the 49-G(and who carried them?) and then would buy the TI-92 because of its bigger size! Looks over brawn every time = Small sales for the better product.
Please tell me I'm wrong.
Moreover, consolidation in the desktop PC market is needed. With DELL whipping everyone's ass, one of either GTW, CPQ, or HP needs to say goodbye. Neither CPQ nor HP can really compete with the likes of DELL, and they both are bleeding cash on their PC sales. Plus, if one firm exits, that breathes new life into the sails of the others.
HP should stick to what it does best: printers, servers, and services. Those businesses have recurring cash streams. PC's are the real problem. It's too bad they spun off the Agilent (?) division a few years ago to focus more on PC's. A is a good, strong company.
Yes, Fiorina is out if the CPQ merger falls through. She's been totally distracted by the merger, and I doubt if she really has a handle on the existing businesses.
Sig (appended to the end of comments you post, 120 chars)
...HP go out of business now.
I mean what does HP do if it doesn't do PCs, because we all know that Fiorina wants to get rid of HP-UX and all of that GOOD stuff.
Yes, that leaves flimsy INKJET PRINTERS! Cool. And digital cameras. Wait, they suck at those, so just printers.
Carly has successfully driven this company into ruin. As she did with her previous ventures. Why doesn't she just file chapter 11 right now to be done with it.
Face it, Carly has driven this company into ruin.
"HP Invent"
Wealth is the product of man's capacity to think. -Ayn Rand
Any other everquest players thing of someone else whenever they read the name "Fiorina"?
Just me then...
Sig is taking a break!
PCs are simply too easy to build. Anyone can do it. The real issue becomes PRICE, and the big companies are caught between having the power to leverage incredible prices out of vendors, and being to big to move the product out the door before the price loses its luster.
It is a matter of time before there are no pre-built PCs at the mid-level on up- that they are all built-to-order and sold at the price of the components at that exact moment. I'm not going to make any quotes, but there is (obviously) an incredible level of depreciation per week for a PC sitting on a store shelf. Is anyone making money these days selling pre-built PCs? I know HP also sells built-to-order boxes...but who would pay their relatively high price?
As a bit of an aside: and this says as much about Sam's Club (I hate that store, they could do Springer auditions there... but I had to go there for work purchases occasionally) but I'd see these HPs that were at least a year old on the shelves... with their year old price tag (still at a premium). What an undignified way to sell PCs!
Both companies seem to have made serious blunders at its lower level consumer lines that would certainly make me think twice about their server/networking products.
Imagine a world with nothing but white box builders.... OK, that will never happen.... imagine a world where everyone just builds their own PC.... no, that will never happen either- not that it couldn't.
Those that suggest you "dance like no one is watching" really want to see you make a complete fool of yourself.
If Hewlett Packard were to pull out of the PC (note, big if) it would be the end of some of the best desktop and server products in the industry.
From their consumer, soho, business and workstation PCs (such as the Brio, Vectra and Kayak ranges) all the way up to their server offerings, HP have consistently produced top-notch products.
Well designed, reliable machines with excellent utilities (is there a management suite out there that's better than TopTools?) backed up by a professional and knowledgeable support structure have made HP PCs a dream to work with - as both a end user and a system administrator.
Sure, the printing business may be the company's major cash cow but it's its systems that really impress me.
I've been fortunate to have reviewed PCs from dozens of manufacturers, and I can honestly say that if I bought a PC (I tend to build my own) there would only be two companies I'd buy from. HP is one of them.
But let's be realistic here. HP has a massive installed user base, including many blue chip corporates. It's not going to abandon making PCs and those customers (many of whom will have support contracts that guarantee the availability of their preferred desktop and servers for years to come) any more than it's going to abandon its print business.
From the sounds of it, this is classic boardroom spin ("if X doesn't happen then we'll be forced to do Y") aimed squarely at getting Fiorina the votes she desperately needs to push through the HP/Compaq merger on which she seems to have mortgaged her career.
Quite frankly, if this comment was a serious statement of HP's intent then it would have been made to a more respected media outlet, such as the Wall Street Journal or a Ziff Davis title, or via a major press conference, rather than the less-than-heavyweight USA Today.
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
once Compaq gave up the alpha to HP and HP in turn sold the IP/whatever else to *ntel.
Ironically enough I saw a blurb on the register (IIRC) and a few other sites that said if the "Q" merges with HP (rumor at the time) they would kill off the Alpha to the god of x86 (ok, I'm paraphrasing).
Guess what? Came true 2 or 3 months later.
Ok, I'm wierd for "missing" a processor architecture, but at least it gave us the EV6 bus for the Athlon before "Being Offered up".
(sigh)
Have you read the moderator guidelines? Well, have you, PUNK? (and I want a Karma: Gnarly option)
As of this post, CNET News is running a 13 part article on "visionary" people in the IT industry. Fiorina is listed on this, as is Steve Ballmer of Microsoft and a handful of other forgetables.
Yet Steve Jobs, who critics and pundits agree has great vision and has molded and changed the PC community dramatically despite the fact his computer does not make actual PCs, isn't listed?
And Carly has been with HP for about 2 years and hasn't really made any significant impact there beyond driving their stock price down.
HP makes decent printer hardware (except that POS OfficeJet series, which I own) and its PC hardware (which I worked on for 2 years) is adequate, albeit unremarkable. Perhaps Fiorina's departure could kill two birds with one stone--HP's PC business (so they can concentrate on what they do best--printers) and Compaq (whose PCs are among the rattiest things to maintain in the market).
/.
Vos teneo officium eram periculosus ut vos recipero is.
Then again, it could be part of the normal cycle and HP may survive this one and boot her out. I hope HP does not get rid of their PC division or their printer division. I love HP printers and have never had problems with them. I've had plenty of other printers that plain old suck and didn't work right. After getting a HP printer, I never looked back.
Who really knows what CF is talking about. It could be real or just political maneuvering. In either case, sounds like Ego is in play. I hope she retires, or works in some other field.
~~~
Believe me, the bitch had an impact. Not a good one though!
Ask people who work there and you will see what I mean. Many people left because of the changes she brought... HP used to be a good company to work for, things change!
HP not doing well in the PC business is no news. It was already the center discussion of company meetings 4 years ago. HP at that time was saying that it could not keep in business if it was not in the top 3 (go figure why!) and it was already fourth at that time, and still slipping down.
It was making fun of Dell for being nothing more than a Pizza delivery company, and were discussing ways of getting back up where they belonged.
The only department making big profits was the printer division and the PC repair one (not a good sign huh!)
Anyway, I for one am not going to thread any tears for HP. The HP way, has become the HP no way!
Black holes occur when God divides by zero.
This is understandable. Xerox just dumped it's SOHO (small office/home office) printing unit last year. The reason: you can't make money on the printers, just the supplies.
If the market is saturated now for inkjets, then they are losing money if they are still manufacturing the printers. HP's have a really high quality, unless you are playing basketball with it. So people don't replace printers unless they want higher resolution (digital cameras). Now that resolutions are picture quality, the only optimization is speed. Who cares if the new model prints at 8PPM instead of 6PPM, it's not like you sit there staring at the printer while it works. You surf the web, play solitaire, or do your bills.
Hp already spun off their test instrument divison into another company, if they get rid of printers and computers what's left? Why don' they just go chapter 11 and call it a day?
This scenario has played out too many times before. Heathkit stated making computers and was bought by Zenith, Heath/Zenith computer division was sold to Bull, good by Heathkit.
Before that MITS stated making computers, Pertech bought the Altair part of the company, good-by MITS.
The best part was the HP service. Whenever we had a problem the HP field engineers knew how to fix it right, the first time. We were pretty happy campers.
Then HP had the bright idea to outsource all their service to Vanstar. The gorillas that they sent to fix our machines were barely A+ trained. I watched one day as one guy - who had brought the incorrect power supply with him - literally tried to hammer the new one in place, bending the crap out of the motherboard in the process.
After enduring this abuse for six months or so, with HP turning a deaf ear to our complaints, we voted with our feet. The next leases went to Dell. They don't have a nationwide field service organization either, but they're much more responsive than HP is these days.
'stoo bad, really. I did like those HP cans, and I did like the HP service folks. But HP doesn't stand behind the product anymore. When HP outsources the printer maintenance business it'll be interesting. Maybe we'll look back to IBM again.
How about the "agilent" mess - she should be gone for that alone
-- 73 de KG2V For the Children - RKBA! "You are what you do when it counts" - the Masso
For the Record
Posted January 16, 2002
The following memo was written to Embedded and Personal Systems (EPS)
employees from EPS President Iain Morris to set the record straight
regarding recent press reports on the future of Hewlett-Packard's PC
business.
Dear All,
I would like to wish each of you a happy and productive 2002.
I'm writing to you to set the record straight regarding recent press reports
on the future of our PC business. You may have seen an article this Monday
in USA Today which claims that Carly "warned that, should it [the merger]
fail, HP's vaunted printer and imaging businesses would be damaged and HP
might have to shut down its personal computer division."
This is not the first time the press has zeroed in on the notion that we
should exit the PC business. Rather than suggesting we exit PCs, Carly was
explaining the importance of the merger -- in the context of a range of
strategic alternatives -- as a way to fix our PC business. She was also
responding to Walter Hewlett's assertion that PCs are a challenging business
(yet he fails to offer any thoughts on how to improve it).
According to the full transcript of the interview, what Carly said was: "It
[the merger] allows us to fix our PC business. We can't get out of our PC
business. If I didn't care about laying off people, I could just shut it
down. But if I shut it down, I'd have to lay off a lot more than 15,000
people across two companies over several years. So, we have to fix our PC
business. And fixing our PC business requires volume and distribution
capability."
To further clarify her remarks, the 15,000 figure has been included in our
filings with the U.S. Securities and Exchange Commission. It refers to the
estimated number of employee reductions of the combined HP and Compaq
workforce, which will total about 15,000 people. It does not specifically
refer to the PC business. The reductions are expected to occur during the
first two years after the merger closes and will be achieved through a
combination of targeted job reductions and attrition.
It is important for you to know that HP remains committed to the PC
business. By merging with Compaq, we believe the cost-savings from the
anticipated synergies and economies of scale will lower the cost structure
of our combined PC business and have a positive impact on margins. We will
also be able to leverage the significant progress Compaq has made developing
its direct distribution capabilities to create a more flexible distribution
model for the combined company and help us address this important industry
issue.
By combining HP's strength in the consumer PC business and Compaq's strength
in the commercial PC business, we will create a more balanced industry
leader. We also intend to create sustainable value in our PC and other
personal systems businesses by innovating across emerging categories and
delivering a new generation of connected access and embedded devices.
The merger also will provide important benefits to HP's imaging and printing
franchise (also mentioned in the USA Today article). By improving operating
margins in our other business segments, we expect to increase our investment
in core IPS research and development and new IPS initiatives such as digital
imaging and digital publishing - investments that are crucial to maintaining
our leadership in the IPS business. According to Carly: "Imaging and
Printing is not a cash cow. It is a growth engine that has to be invested in
if we're to capture the real growth opportunities in Imaging and Printing
going forward."
Our vision is to become a premier provider of the end-to-end solutions our
customers now demand. That requires us to be a leader in imaging and
printing and computing and services. It requires us to be a leader in both
the enterprise and the consumer space. PCs remain an important part of the
end-to-end solutions we provide.
In closing, let me thank all of you again for staying focused on the
business at hand, and for continuing to help HP emerge an even stronger
competitor when the economy rebounds. Here's to delighting our customers,
delivering results and beating the competition.
Thank you,
Iain
What will the world be without crappy HP computers that you can't get any bloody drivers for? I dunno how I'll ever live without that low level of tech support again.
Ever try installing a real copy of win98 on an HP?? What a nightmare!! It's about time they stopped making PCs!!
At least you can download drivers for Compaq systems!
Since then it was discovered that a lot of Lucent's "success" was based on juggled books and bad debt. But by the time all that was discovered, Lucent was spiraling down in flames. They kicked McGinn out with that most golden of golden parachutes, but Carly was long gone to HP by that time.
You can bet that Carly has learned her old Lucent management lessons well, and in between Power Point presentations about how gutting the company of technical expertise is going to save billions and inspirational talks about how the merger is good and the old HP is bad, she's carefully packing that parachute.
The problem with the PC business is that nobody makes any real money from PC's except for Intel and Microsoft. It's a perfect picture of the problem with commodity vs. non-commodity equipment. People consider PC's to be commodity hardware, but that's not the case. A PC is built mostly with commodity hardware -- everything except the CPU and the operating system. Uncoincidentally, the makers of those two components are the only ones able to set their price points high enough to make any real money. (One has some decent competition, and therefore can't set their prices too high... the other has a monopoly and can set their prices outrageously high.)
This is why the fall of the MS monopoly is inevitable. Once the market realizes that the OS can be commoditized as well, Microsoft will be lucky to keep any of the low end at all. Why sell a $500 computer containing a $100 operating system, when you can sell a $400 computer with a free one?
Tired of FB/Google censorship? Visit UNCENSORED!
HP was the last half-way decent retail computer a consumer could buy. No, I'm not talking about Dell, because a lot of less technically experienced people don't feel comfortable ordering their computer over the phone/internet.
I sell computers at Circuit City. It's a pretty good way to pay my way through school. If you walk into any retail store (Circuit City, Best Buy, CompUSA, etc.), you'll see four major desktop brands: HP, Sony, Compaq, and E-Machines. Most stores will usually have one or two more laptop brands (usually Toshiba and possibly Fujitsu). For desktops, HP is the only one of those brands listed that's even halfway decent. Compaq's Presarios are heavily integrated, cut-$2-off-this-win-modem-price pieces of crap. A lot of semi-savvy customers refuse to buy Compaq because of their previous experiences with them (it didn't help that their Presario line used to use proprietary RAM upgrades, either). E-Machines are shoddily assembled completely integrated computers with one thought in mind: Price. Which works well for folks who need a $400 or $500 computer package, but it won't do much for them. Sony's build quality is at least decent, but their occasional use of proprietary equipment, and their (usually) higher price relative to similarly equipped Desktops usually precludes them from the running. And don't get me started on the fact that they phased out last year's models (SDRAM-based P4 units) in mid-November and haven't supplied their retail partners with 845 chipset-based units yet.
That leaves good ol' reliable HP. Their PCs always use industry standard equipment, and the build quality on their desktops is very nice. Yeah, they charge a little bit too much for their monitors, but their inkjets are the best in the business (yeah, we techs sneer at inkjets, but you'd be surprised how much most folks like them).
Well, here's to hoping that this doesn't happen. Pavillion PCs will be sorely missed at my store.
She sounds more and more desperate every passing day. She's now openly resorting to threats and bribes to get away with the merger. Does she really expect to keep the job if the merger falls through, anyway?
You could also make an arguement that Carly had a lot to do with Lucents current problems. She likes to finance the sales of goods in-house. when the dot-coms fell apart, Lucent ate those loses.
She has shown me nothing to indicate she is a good manager, leader, or innovative thinker. Affirmative action at work.
I've got to admit. I don't really like HP PCs but I do like their printers; especially their laserjet and color laserjet lines.
Now Fiorina says she NEEDS Compaq to save its printer business??? HUH? Who else really competes with HP for mid-volume laser printing? I can see wanting to lose that low-margin HP inkjet business (gee, an apollo printer for $49.00 is hurting our margins? I can't imagine why?)
The bottom line is that HP needs to get rid of Fiorina and put an Engineer-CEO in her place. Intel ran into similar problems about 2 years ago when marketing and business people started directing the company instead of engineers. Non-engineers will always have a hard time running a technology company because they don't have the technical ability to concentrate on innovative, high-quality products.
HP board of directors take my advice. Dump Fiorina and sell that stupid aircraft she bought with your money, and put an Engineer in charge of that company.
-ted
this story yesterday on CBS Market Watch states that HP is looking to close a plant in France, outsource their PC manufacturing and all of this is independent of the CPQ merger.
the story above may be a move to put pressure on approving the merger.
/* Half alive and half dead too, work is for suckers and the sucker is you. - "Half-life" by Local H*/
I heard that something ridiculous like 50% or more of HP's profits come from printer cartridges. That means the rest of the company is more or less unprofitable. HP should sell everything BUT the printer cartridge division and invest in more printer cartridge plants. Jeez! No wonder Fiorina's in trouble these days.
This space left intentionally blank.
Steve Jobs introduces the new iMac and a short time later, the head of HP, Carly Fiorina declares that they might get out of the PC industry. Coincidence? I think not!
Strange women lying in ponds distributing swords is no basis for a system of government.
on HP unix are best I seen, easy to manage and to setup the second best is deb and dselect..
Cant say much about the rest of the world, but for developing nations esp. India, Thailand the merger displays great synergies.
Compaq rules the PC market by far and HP the peripherals mkt. the high end servers mkt is a scrap betn IBM, compaq, HP and Sun. No Dell anywhere.
With the local governments strongly pushing for tech reforms, there is tremendous potential for growth for both PCs and peripherals.
the same story, with minor variations, replays itself across various international markets...the growing markets.
The Packards would do well to get their blinkers off and realise that HP doesnt live in a garage anymore. Grow up and be a part of the world.
I guess the journalist was in need of a good story to keep his editors happy.
First of all, HP is far from being free of the proprietary noose. I've dealt with a number of people who bought HP Pavillions, only to have all sorts of compatibility problems when they tried to add an upgraded video board and disable on-board video. In fact, some models barely allow *any* expansion cards at all. You have to take what you get with the computer, and that's about it.
IMO, any PC that can't be easily expanded with upgrade cards is defective and worthless. The PC as "endlessly upgradable and reconfigurable white box" is one of the main reasons we still deal with so many PC architecture headaches today (IRQ conflicts, I/O addresses, DMA channels). If you're going to skip the compatibility with 3rd. party hardware, why even use the Intel platform anymore? Otherwise, you have all the bad without any of the good.
It looks as though at this particular point HP needs to look at its management. There comes a time when the directors need to look at the decisions that are being made. Fiorina has been struggling with making decisions that will lead HP. This merger will only complicate things. HP needs to stick to its core business - Network Computers, Desktop Computers, and peripherals (printers ect.). Getting out of the PC will be disasterous.
1) Get rid of HP/Unix, follow IBM and start using a widely accepted network OS (Linux).
2) Smaller and more intuitive designs for the desktop computer will be successful in re-branding the HP name in the minds of consumers, follow Apple.
Being innovative can come from the results from other companies successes, follow Microsoft. They have had a very very awesome business strategy. It does not matter what they put out, because businesses and end users know that they will be there tomorrow. HP is losing ground by complaining PUBLICLY what is wrong. Enough press statements and more action.
HP needs to change like many others. What would be useful is if they set up a site that allowed the OSS world to suggest things or even allows for OSS ppl to work them.
Am I the only person who thinks Carly Fiorina is a babe? Yow!
I'm proud of my Northern Tibetian Heritage
First people were saying that they were dumping the server industry, now people are saying that they're getting out of PCs?? What's left? It's good news for my friend who does kernel programming for their servers, but I wish that people would get their story straight.
you have heard the comparison to razors and disposable blades?
I haven't, but I'm paying way too much for mine, and I'm sure Gilette makes a health profit margin on those too. This is why I use up each razor blade I have until it's so dull that I still have stubble after I've shaven.
This is what companies LOVE to do. If you can make a totally non-generic but dirt-cheap (to them) component to one of your products, something that noone else can possibly duplicate, like a printer cartridge for an HP printer, or a razor blade for a gilette razor, then you will charge as much for it as possible. The same thinking goes for movie theatre popcorn.
It's this level of overcharging that has made Microsoft a multi-billion dollar corporation, but, in fact, is essential for many companies to simply SURVIVE. I'm sure a great many smaller movie theatres would have gone out of business were it not for charging too much for popcorn, and I'm dead certain HP would be in serious trouble were it not for these printer cartridges.
This space left intentionally blank.
and we all thought that sleep button on the tower that Compaq patented was so clever....i guess they finally got word from tech support that the occasional machine never wakes up. (lol)
Darn, and I so enjoyed slashing the living shit out of my hands on the insides of those old Vectras. Too bad we can't preserve that experience for the next generation, eh? Physical pain coupled with a poorly performing computer; now there's a corporate legacy.
--saint
Yesterday was the time to do it right. Are we having a REVOLUTION yet?
Did anyone else notice the HP ads running over this story?
I'm sure their marketing droids would be upset they were wasting their image impressions on an HP-negative article. Seems strange.
Then again, perhaps it was like when my girlfriend searched for "Britney Spears" in google, and a Britney ad showed up in the Windows AIM client.
HP wants to save HP-UX division. She also wants to expand into Linux/OSS. They also have the chip division that developed the itanium (with intel) at Ft. Collins, CO. HP was known as a company that allways re-invents itself. It is simply time to re-invent itself
Sure there is.
Just ask Steve Jobs. ;-)
mrg
Nothing like the impending death of your company to finally get your ass in gear. We've seen Compaq start from lumbering around with the DEC merger not knowing what to do with and operating in the RED. To where we stand today almost 2 years later where they're actually "making" money. Compaq has realized finally that they can't be the baby IBM DEC used to be. Believe me there is plenty of belt tightning left to be done and when it's finished Compaq will be as lean and mean as Dell and with a R&D division that rivals IBM. We should see them finally stabalize in early 2003. As for HP, They'll be missed... Fiona is an idiot. More of HP is comprimising to be part of Compaq than vice versa and the old guard just doesnt want to let go.
Peter
www.alphalinux.org
I think that Dell has the corner on the support market in the PC sector. Try sitting on the support line for compaq or HP, then compare the wait time to that of Dell.
HP and Compaq have sucked ass for years imho, two sucky companies combining makes one really sucky company. Remember all the loser companies that excite@home bought before they went belly up??
Moderators: Please make sure you understand a commment before you moderate. The parent posts are saying that Fiorina is not doing a good job at HP. They are expressing in a humorous way what many, many people think.
For the humor challenged: HP should get out of the Fiorina business.
Bush's education improvements were
Corvallis, now this.. hopefully their new push toward linux on their products will survive all this mess.
A strange game. The only winning move is not to play. How about a nice game of chess? - Joshua (Wargames)
Will that help Apple or will that help Compaq? The only reason that I know of that people walk into those Gateway Country stores is on word of mouth on "Get a gateway, not a Comcrap" or whatever. But word of mouth isn't as powerful as seeing JUST Compaqs when you are looking at all the PC's in a line. Apple at least is putting their stores in shopping malls and making themselves more visible, but Compaq will be showing the nice low sticker price.
However, will Compaq put up the price when it knows they have less to compete with? Will they have an advantage where people might have been choosing HP simply because it matches the name on their printer? With PC margins and a merger in the works, that might happen.
Again however, don't leave Apple out. I once had a compaq, now I homebuild. I like Windows 2000, very capable OS. XP is not, and thats what everything is now shipping with. For something thats supposed to be intuitive, its surprising not. Linux is not at the home desktop level yet (don't flame me). Apple however, has gone leaps and bounds over where they were five years ago. Their new OS looks very slick and they have an eye on design as well as functionality. As long as they don't screw up in the coming years, look for them to increase market share.
To be honest, I'm sure this isn't going to be the spark that makes either company a huge success. They'll both probably see a small marginal increase in sales and there will just be one less store bought computer to complain about.
- gtaluvit (prnc. GOT-tuh-LUV-it)
I've been thinking of putting this in a letter to Carly for some time now. Of course, more people will read it here (a few) than if I send it to her (zero), so here goes:
Ms. Fiorina,
As a Silicon Valley native, I have been very concerned with what has happened to a local institution under your control. Over the past few years, we have seen Hewlett-Packard shrivel from a industry giant in several sectors to a PC and server vendor that is struggling to be considered tier-one.
As such, I offer the following advice:
1. Give calculators to Agilent.
You and Mr. Morris made a lot of enemies by announcing the dissolution of ACO. However, handing the reins to Agilent seems like a simple solution. It seems that the vast majority of HP calculator customers are likely to be Agilent customers anyway. Even though you and Mr. Morris have destroyed ACO, HP calculators have survived gaps in R&D efforts before. Perhaps Mr. Barnholt's team will be able to rehire some of the talent in Australia, and failing that I'm sure that he can recruit some excellent embedded system developers, both from inside and outside of HP and Agilent.
2. Give the Hewlett-Packard name to Agilent.
I'm sure that Mr. Barnholt would be delighted to bring the prestige of the Hewlett-Packard name back to the Test and Measurement business. Furthermore, this move would neatly solve many of your current problems. The copies of The HP Way sent to you by your employees and observers must surely be piling up by now, getting rid of the HP name will likely get the Hewlett and Packard heirs off your back, since their forefathers' legacy would be Mr. Barnholt's to protect.
These two moves would leave you free to pursue your aspirations to build a printer and server powerhouse, and might even keep you in the PC business, despite your recent comments.
You would, however, need a name for this new company. Might I suggest Compaq?
You have violated Robot's Rules of Order and will be asked to leave the future immediately.
Moderators: The parent post is an important comment. Here's a link to the article, instead of just a reference:
Lew Platt began the decline of HP. After several years, he was replaced by Fiorina, who has also not been able to get HP under control.
Hint to the HP board of directors: The new CEO of HP should be someone who has a technical understanding of HP's products. Management experience is not enough.
"Technical understanding" means someone who knows the technology well enough to predict where it will be in several years.
Also, someone who would actually be able to run HP would put a new HP product on his or her desk, before it was released, and try to install it. HP has sold printer products with buggy or insufficiently capable install software recently.
Bush's education improvements were
She's about the only person in the world who thinks any one gives a fuck about HP PCs. HP has one of the best known names in the industry after MS and IBM but I doubt more than one in ten people you asked "What do HP Make?" would say "Computers" rather than "Printers". In the UK more people would say "Sauce" than "Computers"!
So, get back to making good printers that all computers can use and let Compac get on with going bust (or sorting their business out).
TWW
"Encyclopedia" is to "Wikipedia" what "Library" is to "Some people at a bus stop"
Just because Dell is a devoted supporter of Intel doesn't mean no one makes 'real' money. Not only that, AMD actually has increased market share, something that Intel is losing.
Speaking for myself only...
Who cares about HP's PC business? What Carly & Co. should be shot for is letting the crown jewels go to hell in a handbasket. I'm talking about the PRINTER business.
HP printers used to have the reputation of being built like tanks, and quite rightly (I personally saw a LJII that fell off a 4 foot table in the Northridge quake. After it was picked up and the toner reseated, it worked just fine.).
Nowadays, they're cheap flimsy plastic crap.
Fascism starts when the efficiency of the government becomes more important than the rights of the people.
personally, i'd love to see Compackard snap under it's own weight. thanks carly for everything.
2 down and 2 to go.
long live the macintosh.
HPs computer just stink. Have you opened any of those? It's scary! However HP makes the BEST printer, great scanners, ok cd burners, and more. They should stick to what they're good at.
The GeekNights podcast is going strong. Listen!
That's the only decent thing they make anymore.
First she dumped the HP calculators. I had to buy my son a TI graphing calculator recently because there no HP graphing calculators left to buy. No RPN...he will grow up with the "=" key and Carly is to blame. :( Now she wants to dump the HP computers (which used to much better than they are at the moment...Carly's fault there too?) What's next to go? Printers? The HP shareholders need to wise up and get rid of Carly before she wipes out the last vestiges of HP's reputation for high-quality useful products.
HP and Compaq are similar in many ways.
Both are headed by inept management. Both used to be visionaries in their industry. And both don't care about support. Why do they outsource allmost all support for their PC's & printers? They offload their problems onto another company in doing so.
Having worked for both Compaq and HP before I can say with absolute certainty that if the merger goes through that it will be a match made in hell.
"HP has been getting by on reputation for 10 years now."
Exactly. I've experienced similar craziness from HP.
Bush's education improvements were
Dell is still all mail order and with IBM and Toshiba beginning to transition what's left of their PC lineups over to web based orders as well, customers will walk into CompUSA, Sears, or Circuit City and will face themselves with two choices: Compaq or Apple?
About then, you will start to see an "Official M$ PC", and that'll become your only choice because soon after that, the next versions of WinWhatever will only run on their own hardware, that'll also coincide with the passing of laws that require PC's to have copyright control all over and within them. These will become the only kind of PC's legal to sell, own, posess or operate. Get caught running any older PC's without the copyright nazi stuff built in or with non-approved software or o/s (linux) and you'll be sentenced to prison as a cyberterrorist.
HP needs Compaq to stay in the printer business? Compaq isn't in the printer business. They resell somebody's fax/printer/scanner combo, and they offer one Compaq-branded inkjet printer, which they probably don't make. Mostly they resell HP, Lexmark, and Xerox printers.
I use Vectra Vl's and Netservers. The build quality is good, the thought that goes into the maintainability is good - no tools needed for desktops - every thing is replaceable easily with levers. But their support has just plummeted in the last year. Two years ago I had a user destroy his floppy disk drive by shoving a disk in backwards. HP sent out a guy to replace it for me. It's not like that any more. My LH4 Quad CPU server even had a "how to install Linux" guide, and they certify MS, OS/2, NOVELL and Redhat on most of their new boxes, but I no longer have that confidence in the company.
HP should get out of the PC business. Hands down the worst PC I ever worked on was a Pavilion 7170. Granted it was ancient, but it had a daughter board that blocked the RAM memory, and I had to unplug all PCI/ISA cards to remove the daughter board before adding memory. Damn near had to strip it bare, all for a RAM upgrade. Thanks HP! I'll take a Dell anyday over HP.
pot.kettle(black);
This memo doesn't just score a 'BINGO', it fills in the whole damned Buzzword Bingo card!
It's amazing how so many words can say so little.
There's some irony in the fact that Carly will be a keynote speaker at the next Linux World expo while she's killing off MPE/ix - HP's OS for the 3000. If there ever was a reluctant poster child for open source, HP is it.
HP has lost interest in MPE/iX and so the existing users have asked that HP release the source to them so that they can continue to support it. HP is hemming and hawing which sounds an awful like "No."
Instead, HP prattles on about "earning your continued trust..." while the larger HP3000 customers wonder how they'll recoup the enormous migration expense that HP has foisted on them.
If HP was serious about wanting to retain their customer's trust, HP would hand over the source and be done with it. It's one thing to say "we can't make money any more on the 3000, here's the source to the software you've been using" and quite another to say "We can't make money any more on the 3000. We're not going to let you have the source because we want you to buy this other solution instead."
Carly's tenure is in jeopardy not so much because of the Compaq merger but because of the enormous damage that's happened to the HP brand during her watch. The failed Price Waterhouse merger, closing the calculator division, throwing away PA-Risc (an amazing CPU!), screwing the HP3000 users, and now the Compaq mess look like more than 3 strikes to me.
Fiorina's tenure at HP head is a disaster at best. She got the job, got tons of favorable publicity because of her gender, and proceeded to do a terrible job.
She still gets a pass by the media/analysts because of her gender.
Isn't that an example of the media's double standard ?
Hey, newer HP laser printers almost always function off of Laser Jet 4 drivers (in our environment anyway). Deskjets are what give Citrix a heart attack around here. Those are the ones banned from Citrix.
PC makers don't get it... there is simply no way to differentiate yourself in this market or under Intel or MS's umbrella...
Sure there is; look at Sony. They came relatively late to the PC game and have done very well. While they have a well deserved rep for proprietary hardware problems, the flip side of this is giving consumers what they want and leveraging their strengths.
In some ways you could compare them to Apple. Firewire, strong video integration for users, high (relative to a beige box) design sense. Re: music, they have taken a different road by tying some of their desktop PC's to MiniDisc, a format you may not see much in the US, but which dominates in Japan, and is I believe more prevalent in Europe.
They're also one of the few manufacturers to try to run with Crusoe; not exactly under Intel's umbrella. As far as M$, well Linux and *BSD are very nice, but not really ready for the homebody users that are Sony's bread and butter. I run Suse on my Vaio notebook and am very happy with it.
There is no way to differentiate a commodity except price, so take your products out of the pure commodity category, and people will buy.
Sig?
Sigue Sigue Sputnik!!!
Quite frankly, I equate HP to the same quality you expect from Packard Bell. I hate those tiny cases!
Zodiac Survey
Oh no, what will the PCers do now. Another x86 cheapa$$ is biting the dust.
LOL. One day it's going to be just Dell and Microsoft. What excuse do PCers have then?
They won't have any, that's why they'll keep buying M$ and it's whores in the x86 cheapa$$ industry.
If peopled didn't buy from the big guys like Dell, HP, Compaq, and gateway, I would love it. I build PC's for fun, I just got done with building one for my uncle. I checked prices against Dell, he checked against gateway - we were both really happy. He can pretty much do it himself now, and I had fun - wish all my friends would come to me for stuff like this - i'd do it free I love it so much. Or charge them a pizza or something like that...The fact is that a lot of the time, small guys who use Pricewatch are much (as in 30%) cheaper...
- dave
Who is this Anonymous Coward character, how does he post so much, and why is he always such a whore?
Why is it that Slashdot does not have an HP subject category and related logo? Come on, this is one of the oldest and most respected companies in the industry. They deserve a section.
I'd like to turn her over my knee, pull down her panties, and spank her till she begs me to fuck her in the ass!
Yes but whats the POINT? I wanna use a computer not spend time fiddling with it. When I needed two PC's to run FreeBSD and Linux I looked all over, including the small mom and pop shops that sold AMD chips and were way cheaper than the big guys. I decided to try one, then they told me I'd have to wait 2-3 weeks for my system to be built and to arrive. Compaq was able to ship me stuff the next day.
Building your own is fun and all but I just want a minimum of fuss. Is that such a crime?
Mac OS X and Windows XP working side by side to fight back the night.
According to HP's website, "Fiorina holds a bachelor's degree in medieval history and philosophy from Stanford University". In my general experience, most people in these majors are there because they don't know their a** from a hole in the ground. (I'm majoring in computer engineering.) The bio goes on to state that she has two other masters in business. While most realize that a persons real skills and career can vary greatly from their undergraduate degree, it's pretty obvious in this case that this is one of the reasons why she has no handle or insight on the technology that drives her company and as a result is making terrible decisions. When are people going to realize that in order to manage (or as hp wants to "invent") technology you need to know something about it, because the only thing that one learns from a business degree is the business of business which is finance,
accounting and economics. That stuff can always make your paper work look pretty and attract investors but it doesn't sell good products or innovate.
...do you think this has something to do with HP's infamous support record catching up with them? I mean, overall I can't see why Compaq could help HP's PC division more than HP can, but perhaps the problem really is in support (or lack there of).
-Tim
-------------
"You would not get a high grade for such a design" -- Andy Tanenbaum on Linus' Linux design.
There is a lot of Carly bashing here but I think a lot of it ignores a couple of facts.
(1) I think everyone is focusing on the merger but like most things, these troubles have their start long before Mrs. F showed up. HP had sharply reduced R&D spending for the previous 4-5 years before she took over. This made profits higher during the Platt years but there was simply very little in the tech pipeline when Carly came on board. Because of this they missed the boat on storage, enterprise software and a number of other growth sectors. They were left funding upgrades to their printers and PC's. Not very interesting and the PC business sucks. I believe that this is the reason for the majority of HP's current problems. They should be in enterprise computing and out of PC's.
(2) I love their calculators also but let's be honest, not much money here (probably losing money) and they would sell the division if anybody was interested (which it looks like no one is). This tells you a bit about what this portion of the business looks like. If it looked good, someone would buy it. And people have looked at it. Love the product but not a good business from an owners point of view. A bummer.
(3) Spinning off Agilent was the right thing to do (although she wasn't the one that did this). It is an entirely different business and conglomerates don't work. There is simply no reason these companies should be connected (just because that is the way it was doens't make it right). Agilent probably should have gotten the HP name but this is just a surface issue in the end.
(4) Both HP and Compaq's PC businesses suck. They are both stuck with the classic distribution channel and attempts to go with the direct model creates tons of channel conflict. Also, these models are somewhat all or nothing propositions from a operational efficiency standpoint. Being in both is a loser.
(5) Carly first went with the PWC merger idea which probably made more sense (go compete with IBM and Sun). Without another service firm merger candidate, she was left to either
A. Shut down the PC business
B. Merge with another firm and hope to cut costs (this works....sometimes..and with a lot of work)
C. Fix the current PC business. This frankly, is a non-starter. Easy to talk about on a web discussion site but really just about impossible to pull-off. BTW, to the guy talking about HP's laptops, ya they are nice but they don't make them. I believe the same company that makes Dell's laptops makes HP's.
Easy road would have been (A) (what I would do). I will give her this, she is at least trying to make a go of it and keep HP in the computer business. This takes a lot more balls than anybody here is giving her credit for.
Again, looking at her situation (pathetic R&D situation means nothing for a couple of years and a crappy PC business) she walked into, she was really stuck between a rock and a hard place. And I have yet to see any practical alternative from anyone on this board besides some broad handwaving about making HP a great company.
... never used to reading between the lines. CARLY FIORINA IS ATTEMPTING
TO SAVE HP'S STORM-TOSSED PC BUSINESS. Why the proposed merger with
Compaq if not for this very reason? Compaq has nothing to give HP but
a dosage of revitalizing medicine. That is what
attracted Carly Fiorina in the first place. With the merger deal
on the verge of collapsing, poor Fiorina is left to giving not
so subtle hints about the imminent future of HP without Compaq.
``Hoping to frighten the crows with your `off-the-record' remarks
to the USA Today reporter Carly?'' Truly, Fiorina will be forced
to resign if this merger does not proceed.
Influential members of the HP board are opposed to the merger
for reasons that are not very clear. Hints are emerging that at
least the Packard faction is concerned about what the merger's
costs will do to HP's profitable printer business. But whatever
their reasons are, no one is talking outside the board-room.
---
``I bet you 10 dollars I'll be modded down.''
As a previous 20-yr HP employee (now retired), I interpret Carley's threat to kill the PC business (and fire even more employees) as a ploy to motivate employee stockholders to vote in favor of the merger. However, she under-estimates the intelligence of the average HP emmployee.
While there's not much money to be made in PC's, there's not a lot to be lost either. HP is really good at managing the retail supply chain, and as long as they keep executing, there's no reason to stop selling PC's.
The advantage for HP in selling PC's is that:
A) they are able to offer complete solutions to their business customers.
B) they are able to wield incredible power in the retail market, making sure that printers, Jornadas, cartridges, paper, cd-writers, cameras, scanners, etc get prime treatment over other manufacturers. Did you know HP is #1 (units) in retail digital cameras? Cameras?!?!?
Combining with Compaq only increases this power. Whether they can actually pull off ther merger is another matter all together.
HP is not getting out of PC's.
It was a gigantic bit of speculation from USA Today (known in my family as McPaper).
/. entry.
She DID say during her interview in USA Today that HP needed to fix its PC business, and when they do that, they necessarily look at a lot of options. They look at outsourcing, exiting the business, concentrating on certain industries, etc.
She went on further to state that HP is committed to the business.
Then USA Today lost its mind and said "HP is considering exiting the PC business". They probably did that because it would sell papers.
Finally, to complete the game of telephone, other sources are picking up the USA Today story and embellishing on it. Witness the lead article of this
If you really want to know what she said, get the USA Today interview; do NOT read the analysis; and come to your own conclusions.
Why oh why must technology companies be run into the ground like this? Carly is just a bad manager and bad leader but her failures ride on the coat tails of Lew Platt's failures. I don't give a shit that Carly is a woman CEO, for all the hubbub made over that it doesn't really matter in one way or the other. What does matter is how shitty of a CEO she is. She knows her antics would have gotten her tossed out of her position so she made the entire company's upper management sign an agreement never to disagree with anything she proposed. If they didn't want to sign this agreement they were shitca...offered early retirement with a fat check for maintaining their integrity.
Any crap about HP getting out of the PC business is just boardroom antic crap to light a fire under board members. If they don't agree to vote on [proposal] the company will have to drop [product or service]. That is entry level business class crap. The problem is Fiorina sees the Compaq merger as her brainchild and as the future path HP must take. Compaq and HP if merged would form the biggest retail PC maker in the industry. Theoretically they could leverage their systems anywhere. Between them they have inlets to all of the major retail outlets in the country. Theoretically.
The reality of it is the merger would only make one big company to lose money. Maybe she ought to really go through with getting out of the PC business. The market is saturated as it is, people who want PCs have them and aren't going to buy new ones as long as what they have does what they want. People want to get on the internet and type stuff up and play the occasional game. PCs are so fucking overpowered that a two year old PC is still way above what even current software needs to run properly. It would be pretty hard for you to find any consumer program that didn't run just fine on a three year old 500MHz P3 with a TNT2 video card.
I'm a loner Dottie, a Rebel.
get out of the PC business. I work for a company that does HP warranty work among other brands, and I've seen more HP Pavilion PCs cross my bench than almost any other brand.
Which is actually kind of surprising considering they did have some quality components like ASUS motherboards and the like.
It seems HP's quality started to dive when they started to diversify in the home market, ie. Pavilions, cameras, the CD Writer+ 7200, etc.
ChodaBoy
- The preceding statement is the product of a deranged mind and the sole property of the voices in my head.
Red Herring
Feb 2002
To: Carly Fiorina
From: The Editors of Red Herring
Re: Your Departure
Dear Ms. Fiorina,
Please resign.
You were appointed in 1999 to replace the boring if dependable Lewis Platt. An outsider, you brought to Hewlett-Packard the cult of the celebrity CEO. You said the right things:
You promised Wall Street 15 percent annual growth when HP (a sclerotic giant with $42 billion in sales) had seen its growth dip below that figure in 1998.
You predicted that HP would be a leader in "the second phase of Internet." You assured employees that you would embrace and yet reform the "HP Way" - the egalitarian, innovative, technologically driven corporate culture that bill Hewlett and David Packard created.
You have not met any of these promises.
First, Wall Street has lost faith. Since you took charge, the company's stock has tumbled 50 percent: nearly $4.8 billion in shareholder equity has vanished.
HP's cost of sales has increased 19 percent from October 1999 to October 2001-but revenue has declined by 9 percent. Among your competitors, only Apple Computer, Gateway, and Compaq Computer have done worse over a similar period.
Second, under your management, HP seems unlikely to be a leader in the second phase of the Internet-or anything else. For example, you tired to copy the corporate-services successes of IBM's CEO, Lou Gerstner, by making a pass at PWC, only to see the $17.5 billion merger fall apart. Good thing, too, because purchasing the consultancy could not have made HP another IBM. IBM's services are so attractive because, in addition to expensive servers, IBM Sells software. Fully one-third of IBM's profits derive from software sales. HP has-what? Nothing. Your company earned a mere $1 billion in software sales in 2000.
Third, far from embracing and renewing HP's corporate culture, your personal style has been comically at odds with the company's traditions. While a CEO with a bodyguard and a Gulfstream IV jet (and tens of millions of dollars in compensation) might be appropriate for some companies, at geeky, democratic HP you have alienated everyone. The 6,000 layoffs you ordered profoundly shocked a company that never laid off anybody.
At press time, you were struggling to merge HP with an even more stricken PC maker, Compaq. You have defended the deal by saying it will allow HP to sell higher-margin PCs and servers to corporations and help the company compete in the coved professional-services market. The William and Flora Hewlett and David and Lucile Packard Foundations (which oppose the deal) have "other concerns," you darkly hint, like "wealth stability." They offer no alternative for HP's future, you complain.
Nonsense. Compaq is not a leader in high-margin computers and servers. Like HP, Compaq sells commodity PCs. The merger cannot help HP sell services- HP has no services business. And wealth stability is a perfectly valid concern for shareholders. No: the merger will only increase your dependence on commodity PCs with their increasingly slender profit margins, while diluting the strength of your successful businesses like printers.
In any case, mergers of large computer companies nearly always fail-as did Compaq's own merger with Digital Equipment. The merger is like two starving men agreeing to share a crust of bread.
You say that your critics offer "no alternatives? Here are some: HP's mergers should aim to acquire technology, not "scale." Specifically, if HP does plan to sell services and servers, it should, like Sun Microsystems and IBM, sell software as a driver of those products. Why not buy a database, data-storage, or server operating system company? Your company's best chance is to embrace its own engineering traditions.
Many have suggested that if HP's shareholders reject he proposed merger, you will resign. But even if the merger is approved, you should leave. You have badly damaged....
"First of all, HP is far from being free of the proprietary noose. "
Agreed, and inversely, the higher end Compaq consumer you get, the less integrated components you find. WOW! big surprise, it's no wonder he works at Circuit City, as his knowledge of computers equates to jack shit. All the low end computers are going to come with onboard components.
All the IJ/All in one printers are Lexmark. They do try and sell Xeroxes with their corporate models, I think.
I wouldn't put anything past that malicious nitwit.
"You make a fundemental mistake. The support costs of a system far outweigh the operating system costs. If you reduce the MS OEM rate from $50 to $0 for Linux, but you double your support costs, you are now losing money! "
The problem with support costs for MS is thatit doesn't do the brunt of it. The OEMS do the most while the remander is taken up by individuals, and books, and other aids. Just because one can't stare support cost in the face doesn't mean they're not there.
Right - MS is smart because they profit from selling a gazillion cheap licences, and the OEMs actually _lose_ money shipping each copy of Windows (which they hopefully make up with hardware markup.)
:)
The only reason this works is that the OEMs would lose even more money shipping any alternative, including Linux. Maybe MacOS on x86 would have had a chance 10 years ago...
If you want a vendor to pick up all your support needs, call your local IBM salesman. Note that his suit costs more than your car
I have an OfficeJet G85, a real nice multi-function device that is great when it works. However, they are up to version 4.0.3 of the Mac driver without successfully producing a stable, robust product.
HP: Awesome hardware. Consistently shitty software.
-ccm