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HP's Shift On PCs Could Boost Acer, Dell and Lenovo
CWmike writes "With HP spinning off its PC business, rivals will be looking for a way to get a bigger piece of the hardware pie. HP's PC unit news, among other industry-rattling announcements, including pulling out of the tablet market and shuttering webOS, rocked the hardware industry since HP is by far the dominant maker in the world. So while HP decides what to do, rivals should be plotting their next move, say industry analysts. Who could benefit the most from any change-up in PC sales? The obvious suspects: Dell, which passed Acer in the second quarter of this year; and Acer is looking to make up some lost ground and could see HP's shake up as an opportunity. And don't forget Lenovo, which holds the third-largest market share. Despite the general downshift for PCs, Lenovo is riding some great momentum right now, reports Gartner. In the second quarter of 2011, the company saw 22.5% growth in its PC shipments."
A related article ponders the fate of webOS, looking at a number of potential buyers as well as the unlikely possibility that HP will open source it.
I guess that is where the market is headed now. And there will be no need for systems integrators.
If they sell of their computer business what do they think they can sell? Companies that don't make anything, can't sell anything, and can't make any money.
If I were God, wouldn't I protect my churches from acts of me?
Nuf said.
Enlighten us more, oh wise seer of truth.
There's no -1 for "I don't get it."
The first "rivals" hotlink didn't even mention Apple. And the "downshift" link mentioned only the iPad. But I'm guessing, Apple might get a bigger piece of the pie too.
That is really sad, I was eager to get a ProBook. Business grade hardware from HP was almost always really good, I'm sad to see it go.
HP makes very good servers and high end PCs. So where am I meant to buy good servers from now? They spin this off the quality will nose-dive.
Acer make junk, Dell servers lack HP's quality and the hardware changes every 5 minutes, Lenovo don't make servers at all.
I have really loved my little Lenovo T500, it has been proved itself to be a rugged and reliable laptop, and it was very affordable. If they p
I certainly would have never figured out that the largest PC maker leaving the market would benefit its competition
Knowing when to cut your losses is a pretty rare skill among computer industry management. Apotheker might turn out to be HP's Lew Gerstner.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
As someone subjected to a server that was entirely Intel's design, I agree 1000% percent.
XML is like violence. If it doesn't solve the problem, use more.
Same here. HP provides our servers, printers, desktops and laptops. And an HP support contract for all that. Eliminating PCs is taking a leg off the stool. Our office will probably shift back to Dell would be my guess.
Intel already makes PCs, or at least they used to. However these were not consumer PCs. They were hardened and designed for industrial environments.
Apple provides, free of charge, the installation tools and drivers to support Windows. They just don't provide Windows itself, that is left to you.
That is really sad, I was eager to get a ProBook. Business grade hardware from HP was almost always really good, I'm sad to see it go.
Maybe they will spin it off and call it Compaq, and little will change other than the name plate. OK, I admit it, that was a little optimistic.
I can't imagine HP are just going to say "OK, all you engineers and technicians; you're out of work. And we will scrap all the tools, demolish the factories, salt the fields...." They are probably going to create a seperate company, and give it a suitable name to deferentiate it from themselves. Hmm. Maybe even call it Compaq. Not sure they would choose DEC :)
Existing HP customers could then be shifted over to Compaq, without any significant change.
Cambo
In the tech industry, there is a lot to see here of interest.
First, notably, a lot of the financial commentators are praising the dump of PSG because of the relatively weak ~5% margin. It is clear that a lot of the vocal members of that circle tear into the numbers piece by piece without consideration of how it relates to the whole. For example, dumping PSG means a lot of big contracts (like the NASA deal they were touting so heavily not so long ago) are going to be at high risk for cancellation. That means not only are they losing the PC piece of that pie, it means they are forfeiting some amount of server sales. The ability to sell all a company's IT needs from datacenter to desktop was actually a non-trivial advantage over IBM for a lot of procurement situations, this means they will forfeit that advantage going forward and lose server sales. There is also the reputation damage associated with companies that bet their business on the consistency of HP to potentially lose the bet. This last part will depend heavily upon how they handle existing contracts and make things right. Another consequence is on HP buying components. When you ship a whole lot of PCs, component vendors will be aggressive on margin and make it up in volume. If you are ordering only parts for servers, expect a hit to server base material cost due to lower purchase volumes. This applies to common components, but more critically distinct components sourced from the same suppliers even if they wouldn't fit in a laptop.
The whole palm acquisition handling demonstrated a complete lack of strategic direction, regardless of your opinion of WebOS. Either there was no market opportunity in the first place, meaning HP bet a couple billion based on poor marketing skills, Palm's team was a lost cause from the start, which HP should have figured out before the 1.2 billion dollar check, whatever capability was there was destroyed by HP mismanagement, or it would've worked but they canned it before even really trying. Of course, it's a combination of all of the above, but I do recall a mass exodus of nearly every single 'visionary' person who could take credit for the features about WebOS that garnered any praise, meaning HP either booted them out or at least failed to retain them, which reeks of mismanagement. Launching after the iPad2 at price parity with 0 mind share was absolutely insane.
Another thought I have is around their declared intent to move to software and services instead of PC industry. A lot of people describe this as IBM like, but IBM was *very* firmly entrenched in the software industry before they exited. HP is not nearly so robust in the software industry, and while they may be making moves in the name of getting there, they should be hedging their bets before betting those efforts will bear fruit. I do wonder if the Apotheker leadership is a bit biased from his SAP experience and assuming the answer to any company regardless of current positioning just just become a software development company. I wouldn't be surprised to see the guy handed CEO of McDonald's and tell them to shutter their fast food business and start coding.
In general, they lost 20% of their company value because 1 year ago, they said 'we want to be just like apple' and threw billions at the problem to say in only one year "we want to be nothing at all like apple". They've been showing more and more shortsightedness in their spending in the last couple of years, spending on the magnitude that demands long-term engagement and then changing their minds on short-term timescales.
XML is like violence. If it doesn't solve the problem, use more.
When that 3% earns you more money than the 20% earns the other guy, you won't be complaining.
We will now have to buy our Chinese computers from some other label company like Dell.
ahh, but aren't we supposed to be all buying ARM 64-bit systems right now, in order to save power in those data centres, ehn? like the phytec module using the spear1310 where you can get 8 Dual-Core Cortex A9s with 1gb ECC DDR3 RAM on each, and 8 SATA drives (one each) which are the major power drain in the 19in 1U rack-mounted server? http://www.phytec.com/news/ZT-Systems-R1801e-Server.html
WebOS, like Android, runs atop the linux kernel. You can download the source, plus the patches, from the palm website.
FWIW : http://www.engadget.com/2011/08/19/the-engadget-interview-hps-stephen-dewitt-discusses-the-state/
With there 1-2+ year locks in and they reset when you get a new phone.
Forced Voice plans at $5+ per line or $25+ on there own
Forced Data plans at $20-$30 per Device for at most 5GB with more data being $10 per GB
NO Data Plan pools
Software lock in
App store lock in
forced carrier software on the phone
No mention of the fate of HP/UX or True64.
Having to work for a living is the root of all evil.
More so than how this will benefit Lenovo, Dell, and Acer, I'm interested in what kind of opportunity this creates for Asus and Samsung.
Okay, so who apart from HP sells netbooks with matte-finish screens and Linux?
Lenovo does, for their business-oriented models. I don't know about Linux, but they'll sell you systems with just DOS loaded, at a modest discount.
...but I have a sneaky suspicion there's more to it than this. Yes, Apotheker is a CEO, and as much as we all like to look condescendingly upon those in upper management as being out of touch, HP has been trading Dell for the #1 and #2 slots as far as PC shipment numbers for the past decade. I find it seriously difficult to believe that the board, the shareholders, or even the 'yes men' will say "dump the second most profitable division of our company, excellent idea, sir!".
Yes, you can dismiss my crystal ball (it also said that by this time next year, the touchpad would have had a respectable minority share in the tablet market), but I'd dare say that there has to be more to this story than simply a change of heart whereby the CEO no longer wants to gun for the number two slot in the tablet market simply because he doesn't feel like it anymore or because it failed to make a mint in less than two months. I reckon there's either a problem with some accounting ledgers somewhere, he got a C&D from Apple (who clearly has no qualms about doing so if Samsung is any indication), or...something else that would make more sense than what we presently know.
Not sure if enough information is present to load Ubuntu onto an HP TouchPad.
arguing with pointy haired bosses that insisted on HP hardware that charged more annually for the 'license' to connect to their remote access consoles than I paid for support on other hardware.
Good riddance.
To my former employer, "I told you so."
"No good deed goes unpunished"
HP PSG only has 5% margins. That is only slightly more profitable than Treasury bills. Apotheker said, "we have better ways of using that capital." Making PC's for Microsoft is not a good business and never has been. It is refreshing to hear someone at HP talk who is not a Microsoft-brainwashed zombie.
Apple just became the #1 PC vendor by volume last quarter. They shipped 4 million more systems than HP.
> but I'd dare say that there has to be more to this story than simply a change of heart
> whereby the CEO no longer wants to gun for the number two slot in the tablet market
> simply because he doesn't feel like it anymore
Can't fool you! Yes, there is more going on. This HP CEO is not the same HP CEO who bought Palm a year ago. Two months after the Palm purchase, HP fired their CEO and hired this new one. So the CEO did not just change his mind, he changed everything! He is a whole different guy now. No, he is not interested in being Steve Ballmer's punk, making almost no money assembling Windows PC's.
> less than 2 months
The other thing is that WebOS is much, much further behind iOS than is generally understood. They do not have native apps, they do not use the GPU well, they have all kinds of missing stuff. Software takes a long time to make. The tablet market is MATURE, it is over 25 years old. They do not have time to catch up to Apple. OS X is almost 30 years old, and has Unix components that are over 40. WebOS is 3, and made by a much, much smaller team.
The truth is, if they convert all the WebOS apps to iPad apps, that would be the best return on the investment they could make. Except I don't think their apps would be competitive.