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HP's Shift On PCs Could Boost Acer, Dell and Lenovo

Soulskill posted about 3 years ago | from the nobody-knows-you-when-you're-down-and-out dept.

HP 156

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.

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Intel and AMD will wind up making their own PCs (1)

vakuona (788200) | about 3 years ago | (#37148828)

I guess that is where the market is headed now. And there will be no need for systems integrators.

Uh huh. (1)

MrEricSir (398214) | about 3 years ago | (#37148848)

Enlighten us more, oh wise seer of truth.

Already open sourced (1)

tomhudson (43916) | about 3 years ago | (#37149490)

as well as the unlikely possibility that HP will open source it.

WebOS, like Android, runs atop the linux kernel. You can download the source, plus the patches, from the palm website [palm.com] .

Re:Intel and AMD will wind up making their own PCs (2)

1s44c (552956) | about 3 years ago | (#37148948)

I guess that is where the market is headed now. And there will be no need for systems integrators.

Why? It's not their core business. There is a world of difference at being good at making chips and being good at making chips and whole systems.

Agree (1)

Junta (36770) | about 3 years ago | (#37148992)

As someone subjected to a server that was entirely Intel's design, I agree 1000% percent.

Re:Agree (1)

rickb928 (945187) | about 3 years ago | (#37149070)

I didn't have many complaints with their X series. Especially when we could update the processor board from a 486 DX50 to a Pentium 60. Woot! 32MB RAM!

They went 24x7 for 5 years. Not a hiccup. Then came the Cubix chassis, and from there it was downhill into Windows NT server and Compaq.

Re:Intel and AMD will wind up making their own PCs (1)

Anonymous Coward | about 3 years ago | (#37148994)

Close... But I'd say companies like TigerDirect, Newegg, Amazon, Fry's, Tech4Less, etc. will actually start building to order. They've already got the cases, motherboards, etc. in stock... Assembling a PC really isn't the hardest job either. The parts manufacturers have done a good job of idiot-proofing that. Most of the internals can't be any worse than what the typical "PC maker" offers anyways. When it comes to boards Foxconn, Gigabyte, ASUS, etc. are pretty much what's on the inside in any case.

Hopefully what we'll start seeing in the market is modular laptops. Thus you could roll your own as you do with desktops.

Re:Intel and AMD will wind up making their own PCs (1)

datapharmer (1099455) | about 3 years ago | (#37149174)

That ought to help with QC...

Re:Intel and AMD will wind up making their own PCs (2)

jedidiah (1196) | about 3 years ago | (#37149494)

I have a bespoke box from a relatively obscure web vendor. I have had no reason to disparage it.

My Apple machines are another matter though.

Also have a Compaq that's been a real trooper oddly enough.

Re:Intel and AMD will wind up making their own PCs (1)

Joe_Dragon (2206452) | about 3 years ago | (#37149778)

systemax is part of TigerDirect

Intel already makes PCs ... (1)

perpenso (1613749) | about 3 years ago | (#37149038)

Intel already makes PCs, or at least they used to. However these were not consumer PCs. They were hardened and designed for industrial environments.

Doomed... Not in a good way (1)

Capt.DrumkenBum (1173011) | about 3 years ago | (#37148834)

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.

Re:Doomed... Not in a good way (4, Informative)

Guy Harris (3803) | about 3 years ago | (#37148894)

If they sell of their computer business what do they think they can sell?

"Personal computer business" != "computer business". Their Q3 2011 financial review [corporate-ir.net] indicates that, in earnings from operations in the quarter ending July 31, 2011, the rest of the computer business - "Enterprise Servers, Storage and Networking" - was third, after the services business and the printer/scanner business, and ahead of the PC business.

Re:Doomed... Not in a good way (1)

Capt.DrumkenBum (1173011) | about 3 years ago | (#37148914)

I missed that part. Good, at least I won't have to find a new server supplier. :)

Re:Doomed... Not in a good way (1)

ElectricTurtle (1171201) | about 3 years ago | (#37148900)

That explains why IBM is out of business, unless you think that servers and POS are carrying all the load.

Re:Doomed... Not in a good way (4, Informative)

PCM2 (4486) | about 3 years ago | (#37149370)

That explains why IBM is out of business, unless you think that servers and POS are carrying all the load.

Right... but for the last few years HP has claimed it's competing with IBM Global Services, but I don't see much real evidence of that. And I don't see HP making a lot of software either... IBM has the DB2 and WebSphere product lines (sales of which are driven by their Global Services contracts). I don't know if IBM's hardware outsells HP's, but they have a lot of products available there, too, and they cost money.

But then again, although I have two consumer-market HP PCs here in my office, I'd categorize the tower as "average to meh" and the laptop is pretty much junk. I'd love to see HP clear some space in the retail channel if it means someone who actually knows how to make a decent PC takes their place.

Re:Doomed... Not in a good way (0)

Anonymous Coward | about 3 years ago | (#37150366)

That explains why IBM is out of business, unless you think that servers and POS are carrying all the load.

Right... but for the last few years HP has claimed it's competing with IBM Global Services, but I don't see much real evidence of that. And I don't see HP making a lot of software either... IBM has the DB2 and WebSphere product lines (sales of which are driven by their Global Services contracts). I don't know if IBM's hardware outsells HP's, but they have a lot of products available there, too, and they cost money.

But then again, although I have two consumer-market HP PCs here in my office, I'd categorize the tower as "average to meh" and the laptop is pretty much junk. I'd love to see HP clear some space in the retail channel if it means someone who actually knows how to make a decent PC takes their place.

IBM still sells hardware too other than the Server and POS market, there is the Power Platform, DASD and mainframe. Things like XIV, DS#xx products (DS3000, DS5000, DS8000), Z series (mainframe w/Z OS or Linux), i series (w AS/400, i5OS or linux), P series (AIX or Linux), SAN Volume Controllers, and a mess of other things along with software and the global services.

Re:Doomed... Not in a good way (0)

Anonymous Coward | about 3 years ago | (#37150078)

It is a strategy that has worked well for IBM, yes.

Which makes it all the more puzzling why HP thinks they can compete directly with them.

Re:Doomed... Not in a good way (3, Funny)

sgt scrub (869860) | about 3 years ago | (#37149810)

Companies that don't make anything, can't sell anything, and can't make any money.

Tell that to Wall Street.

Carley really fucked them (1, Insightful)

gr8_phk (621180) | about 3 years ago | (#37148846)

Nuf said.

Re:Carley really fucked them (0)

Anonymous Coward | about 3 years ago | (#37149016)

Carly's been gone for years.

Re:Carley really fucked them (2)

dodobh (65811) | about 3 years ago | (#37149986)

Yeah, but the fuckups have long-term effects. Short term profit, long term loss.

Or Apple (1)

WebManWalking (1225366) | about 3 years ago | (#37148856)

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.

Re:Or Apple (1)

MrEricSir (398214) | about 3 years ago | (#37148934)

I'm sure Apple can hardly wait to get the business of all 15 people who bought a WebOS device.

Re:Or Apple (1)

jejones (115979) | about 3 years ago | (#37149164)

I recommend Heinlein's The Moon is a Harsh Mistress. Pay particular attention to the part where Mycroft is taught the difference between "funny" and "funny only once".

Re:Or Apple (1)

Nebulo (29412) | about 3 years ago | (#37149974)

I recommend paying particular attention to the entire book - it's an outstanding story by an author in his prime.

nebulo

Re:Or Apple (1)

jd2112 (1535857) | about 3 years ago | (#37150342)

I'm sure Apple can hardly wait to get the business of all 15 people who bought a WebOS device.

They already did. Most of them probably bought iPads when they returned their HP tablets.

Re:Or Apple (0)

Anonymous Coward | about 3 years ago | (#37148976)

Yes, because customers that didn't want to spend 3k on 1k worth of hardware before will be forced to do so now that HP's top quality software is no longer there to make up the difference.

Err wait that didn't make any sense...

Re:Or Apple (1)

1s44c (552956) | about 3 years ago | (#37148978)

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.

Apple have limited themselves to selling hardware that runs their software. When they start making servers and pc's that natively run linux and windows then they can have a bigger piece of the pie.

Re:Or Apple (2)

jo_ham (604554) | about 3 years ago | (#37148998)

That would be right now then. You can natively run Linux and Windows on any current Mac sold since 2005 or so.

Re:Or Apple (1)

1s44c (552956) | about 3 years ago | (#37149046)

...at 3 times the cost of buying the same spec from any other supplier. Apple hardware doesn't make sense without the apple software that comes with it.

Re:Or Apple (1)

jo_ham (604554) | about 3 years ago | (#37149116)

You didn't say anything about the cost (and 3x the cost, come on, 1995 called and wants its myth back), you said (and I quote) "When they start making servers and pc's that natively run linux and windows then they can have a bigger piece of the pie."

So, that's right now then. Now you are trying to dig your way out of an ignorant post by trying to retcon in some nonsense about the price.

Yes, you pay a premium for Apple hardware, but that was not the argument at all.

Re:Or Apple (0, Offtopic)

1s44c (552956) | about 3 years ago | (#37149192)

What makes you think I actually care about winning an argument with a random autistic on slashdot?

If you want to run windows server 2008 on apple hardware you go right ahead.

Re:Or Apple (1)

jo_ham (604554) | about 3 years ago | (#37149714)

You care enough to keep replying. So clearly, quite a bit. You're just sore that you got called on a nonsense argument.

Re:Or Apple (0)

PCM2 (4486) | about 3 years ago | (#37149404)

So, that's right now then. Now you are trying to dig your way out of an ignorant post by trying to retcon in some nonsense about the price.

My God, can you imagine what business meetings will sound like a few years from now? I just choked back a gag reflex.

Re:Or Apple (0)

Cwix (1671282) | about 3 years ago | (#37149438)

I chose to look at that argument.
I went to apple.com clicked the first apple computer I saw (Macbook air) and went to the configuration page to get a look.
It has:
13-inch : 256GB

        1.7GHz dual-core Intel Core i5
        processor
        4GB memory
        256GB flash storage1
        Intel HD Graphics 3000

For 1,600 dollars.

I then went to dell and clicked on the 11 to 14 inch laptops.
I found the first one with comparable specs.
Processor 2nd Generation Intel® Core i5-2410M processor 2.30 GHz with Turbo Boost 2.0 up to 2.90 GHz
Operating System Genuine Windows® Home Premium, 64-Bit, English
Display 14.0" High Definition (720p) LED Display with TrueLife
Memory3 4GB3 Single Channel DDR3 SDRAM at 1333MHz
Hard Drive 640GB4 SATA hard drive (5400RPM)

It costs 600 dollars.

The only spec that apple wins with is the fact its using a ssd (I think thats what the mean when they say flash storage.) In fact the dell's processor is better I believe.

The apple is therefore 2.667 times more expensive then the dell.

Its not a damn myth, apple is overpriced. (If you only consider the specs, I don't feel like arguing about the "experience")

Re:Or Apple (1)

jo_ham (604554) | about 3 years ago | (#37149734)

So, you picked the "ultra micro portable" vs an 11" laptop - now try speccing it against a Macbook Pro, or find something equivalent to the Air.

You're not comparing equivalent systems - for one thing, the SSD makes a huge difference in the price, as does the form factor of the Air.

Re:Or Apple (0)

Anonymous Coward | about 3 years ago | (#37149926)

Oh, come on. Why pick the Macbook Air -- that is a pathological case as far as the tradeoff in performance/price against portability. I bet the Dell weighs at least 2x as much. (I don't see a model number there, so I didn't feel like looking it up.)

I think you can make a more reasoned argument with the regular MacBook/MacBook Pro line. Picking the Air and pretending that it is any way represents the rest of their line-up weakens your argument, not strengthen it.

Re:Or Apple (2, Informative)

Anonymous Coward | about 3 years ago | (#37150286)

I dislike Apple as much as the next guy, but be reasonable here - the Macbook Air is expensive because it is ultra light weight unlike the Dell. A Samsung that comes close to the specs of the Macbook is NP900X3A at $1650 and it is half the hard drive and a weaker processor. Take a look at the 3 lb models from others and the Macbook is probably in the upper middle price range ($1400, $1650, $1600, $1950 were the prices for such a laptop with even a $128 SSD on TigerDirect).

Apple does Windows ... (1)

perpenso (1613749) | about 3 years ago | (#37149066)

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.

Re:Apple does Windows ... (1)

jedidiah (1196) | about 3 years ago | (#37149532)

So? It still remains a relatively hostile environment for other operating systems (boot loader, partition format).

Whereas I can just take the Apple parts list, avoid using unnecessarily expensive laptop parts, and put them in a much more expandable chassis or even get something that's meant to be rack mounted.

Or I could just get the cheapest thing I can and forget about the Apple parts list if it's not really needed.

Re:Or Apple (1)

babywhiz (781786) | about 3 years ago | (#37149040)

Unless you can convince Apple to start making a way to run Autodesk Inventor products without having to go to the whole Boot Camp thing (aka double licensing on a single work station is not a smart option for manufacturing)....then no, they won't be 'replacing HP' as a hardware vendor.

Re:Or Apple (1)

WebManWalking (1225366) | about 3 years ago | (#37149144)

Just curious, whom were you quoting when you put quotes around 'replacing HP'?

3% of this market doesn't make you a rival. (0)

Anonymous Coward | about 3 years ago | (#37149058)

Anyone who only has 3% of the PC market can't exactly be considered a "rival" to those who have 20% or more of the market.

Re:3% of this market doesn't make you a rival. (1)

wsxyz (543068) | about 3 years ago | (#37149214)

When that 3% earns you more money than the 20% earns the other guy, you won't be complaining.

Re:Or Apple (1)

bloodhawk (813939) | about 3 years ago | (#37149398)

Apple is barely even on the table let alone a significant piece of the pie. The Desktop/laptop business is jam packed with competition, especially in the enterprise desktop market. Margins are small and competition is fierce, apple rules supreme on the tablet front, but that part of HP's business is even tinier, hence why would the link bother to mention apple?

Re:Or Apple (1)

CharlyFoxtrot (1607527) | about 3 years ago | (#37149492)

Margins are small and competition is fierce, apple rules supreme on the tablet front, but that part of HP's business is even tinier, hence why would the link bother to mention apple?

Because HP says [wsj.com] the fact people are increasingly ditching PC's for tablets (read: iPads) factored in their decision :

"The tablet effect is real, and sales of the TouchPad are not meeting our expectations," Apotheker says, explaining the movement of consumers from PCs to tablets as one of the problems with the PC division. So H-P is exploring options for its unit that "may include separation through spinoff or other transactions."

Basically they're saying iPads are where the money and future growth are and they failed to create even a beachhead in that market so they're getting out.

Also, Dell and Lenovo may take HP's share of the corporate workstation market and Acer the low-to-mid range laptop but Apple will probably take a healthy bite out of the more profitable high end laptop share (what HP had left of it) and high end PC. The volume isn't really important, the fact that there isn't any money left in being top dog volume-wise is the whole reason they are getting out.

Re:Or Apple (1)

masdog (794316) | about 3 years ago | (#37150034)

Because HP says [wsj.com] the fact people are increasingly ditching PC's for tablets (read: iPads) factored in their decision :

"The tablet effect is real, and sales of the TouchPad are not meeting our expectations," Apotheker says, explaining the movement of consumers from PCs to tablets as one of the problems with the PC division. So H-P is exploring options for its unit that "may include separation through spinoff or other transactions."

Basically they're saying iPads are where the money and future growth are and they failed to create even a beachhead in that market so they're getting out.

That seems like a very shortsighted move because HP only acquired Palm last year and has only had a competitor to the iPad on the market for a month and a half. To kill your largest division because your 1st generation tablet didn't make an immediate splash against a product from a company that has a cult-like following tells me that HP's management isn't willing to work to develop a product that they purchased just to enter this market, and they deserve to fail as a result.

Also, Dell and Lenovo may take HP's share of the corporate workstation market and Acer the low-to-mid range laptop but Apple will probably take a healthy bite out of the more profitable high end laptop share (what HP had left of it) and high end PC. The volume isn't really important, the fact that there isn't any money left in being top dog volume-wise is the whole reason they are getting out.

While there isn't a lot of profits left to squeeze out of that market, it is still the company's largest division, and it's not like they have a lot of options to make up that income. When IBM sold their PC division to Lenovo, they had the market for big iron locked up, a successful line of midrange computers, a line of servers, several lines of enterprise software products, and a large consulting division. HP has their printer division, their server and storage lines, their line of Itanium products, and their networking division. HP doesn't have enough in those other areas to make up for spinning out their PC division.

The only thing that would make this move make sense is if HP is attempting to focus solely on the data center and gambling that VDI will be the future of the corporate desktop.

Sucks (1)

tian2992 (1690038) | about 3 years ago | (#37148868)

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.

Re:Sucks (1)

1s44c (552956) | about 3 years ago | (#37148940)

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 make great high end workstations and great servers. Their laptops are not so good. The build quality on any probook I've seen are not up to lenovo's standards although I'll admit HP laptops look prettier.

Spin it off, call it Compaq (2)

perpenso (1613749) | about 3 years ago | (#37149082)

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.

My employers must be psyched.. (0)

Anonymous Coward | about 3 years ago | (#37148882)

.. having switched from Dell to HP over the last couple of years.

Re:My employers must be psyched.. (1)

taxman_10m (41083) | about 3 years ago | (#37149036)

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.

This sucks (1)

1s44c (552956) | about 3 years ago | (#37148918)

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.

Re:This sucks (1)

Osgeld (1900440) | about 3 years ago | (#37148968)

servers are not PC's, simple isn't it

Re:This sucks (1)

1s44c (552956) | about 3 years ago | (#37149088)

servers are not PC's, simple isn't it

Actually tell that to my last employer who brought a few hundred HP workstations, rack mounted them, and used them as servers. It was the cheapest way to buy good quality and high spec hardware at the time.

It's slashdot, I didn't actually read the article. Nice to know I'll still be able to buy decent servers.

Re:This sucks (1)

babywhiz (781786) | about 3 years ago | (#37149094)

You don't think this won't spiral into other aspects of hardware? I can tell you right now that for all the squawk about 'lucrative printer business' try getting parts for any of their high end Plotters. Those parts already don't exist....not to mention a few months ago when the 'HP LaserJet Printer' supply magically disappeared.....while they were "moving the plants to Mexico". Unless you are one of the daily business customers of HP, you have no clue what they 'slight of hand' they are gonna pull. Those of us that have depended on them being reliable is being left with a horrid feeling of having to start all over again.

Re:This sucks (1)

1s44c (552956) | about 3 years ago | (#37149014)

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.

Seems I'm wrong about Lenovo, they do actually make servers. Their top end is very much lower spec than HPs current top end though.

Re:This sucks (2)

datapharmer (1099455) | about 3 years ago | (#37149202)

Dell servers lack HP's quality

Apparently you are wrong about a lot of things. I've used plenty of dell servers and they are well designed and incredibly reliable.

Re:This sucks (0)

Anonymous Coward | about 3 years ago | (#37150066)

I've used plenty of dell servers and they are well designed and incredibly reliable.

I manage 14 servers for hospitals that we have hosted at a 3rd-party data center in Austin, Texas. Just a half-hour drive from Dell headquarters.

My boss keeps buying Dell servers for each of our new clients because they're cheap. One of the new servers had to be completely RMA'd after a week. We had spent considerable man-hours building it out with our product and loading the hospital data. We definitely lost more in labor than the entire cost of the server. When I went to replace it at the data center, I decided to look at the racks where the facility leases out hosting on the machines they own. It was HP as far as the eye could see.

Re:This sucks (1)

Junta (36770) | about 3 years ago | (#37149222)

IBM and Cisco are still very much there in the x86 server space. So is HP for that matter.

you're expected to by ARM systems instead (1)

lkcl (517947) | about 3 years ago | (#37149258)

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 [phytec.com]

Re:This sucks (3, Interesting)

JazzHarper (745403) | about 3 years ago | (#37150132)

They're not spinning off the server, networking and storage business.

Boo HP! yay Lenovo! (1)

notKevinJohn (2218940) | about 3 years ago | (#37148938)

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

Re:Boo HP! yay Lenovo! (0)

Anonymous Coward | about 3 years ago | (#37149052)

Yeah, I agree 100%. The thinkpad brand is really qu

Re:Boo HP! yay Lenovo! (0)

Anonymous Coward | about 3 years ago | (#37149118)

Yeah, I agree 100%. The thinkpad brand is really qu

Cut that out before you start another meme. The last thi

Re:Boo HP! yay Lenovo! (0)

Anonymous Coward | about 3 years ago | (#37149536)

My Lenovo's pretty slick, but I hate that the clitmouse sometimes clicks post bef

No shit captain obvious (5, Funny)

Osgeld (1900440) | about 3 years ago | (#37148946)

I certainly would have never figured out that the largest PC maker leaving the market would benefit its competition

I'm impressed. (4, Interesting)

jcr (53032) | about 3 years ago | (#37148958)

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

Re:I'm impressed. (2, Insightful)

Anonymous Coward | about 3 years ago | (#37149078)

It is their largest segment of their business. The market punished them today for it. It just isnt growing as fast as other segments. They want to say 'oh yeah 10% growth yoy' They have been following the market for many things instead of leading the way.

Instead of reinventing what they make they just threw the largest segment of their business overboard.

When IBM did it, it was not exactly a huge segment of their business at that point.

They are betting on someone else's company saving them. Hence the 10 billion dollar buy.

They do not lead they follow... They have had a string of 'duds' in the consumer market. Instead of taking on Apple and Dell and Acer in making a better PC. They made mediocre/cheaper ones. After your laptop literally falls apart after a year or two people look for better. After gouging your customers for years with ink they look for better.

They want to move into cheap services. More power to em. Whoever ends up with HP/Compaq computers could really take it somewhere. But I suspect they will just margin drive it into the ground.

Re:I'm impressed. (0)

Anonymous Coward | about 3 years ago | (#37149554)

It is their largest segment of their business.

Revenue is not the same as profit. PSG are bleeding cash. They have been for some time.

HP stocks fell along with pretty much every other IT stock today, it was nothing much to do with yesterdays announcement.

Disclaimer: I work for HP

Re:I'm impressed. (0)

Anonymous Coward | about 3 years ago | (#37150374)

Okay. What other IT stock was down 20% today? Look around, nobody thinks that Leo made a good call here. Ditching PCs may make sense. Buying a company to try and save them by placing them in direct competition with established players in a well established market is nothing short of idiotic. Palm was less idiotic because the tablet market is basically iPad vs everyone else. The everyone else market is still quite new. Instead of making an earnest effort, HPQ just spent over a BILLION dollars to just throw away everything. Leo is just that arrogant. His way is the only way. Services are the way forward. Bullshit. Everyone (except for the HPQ board which is just stupid enough to hire Carly, Hurd, and Leo) saw through that. That's why HPQ is down over 20% today, and came down further after market.

In comparison: AAPL -2.74%, +0.27% after hours; DELL +1.74%, +0.14% after hours; LENVGY.PK +1.47%; CSCO +0.47%, +0.33% after hours; ORCL -1.63%, +0.44% after hours.

One of these is not like the others. Buddy, you better start looking for a job other than as Leo's publicist.

Note: I don't work for HPQ nor do I own any stock in them. Probably not a bad time to start shorting the pants off of them tho.

Re:I'm impressed. (0)

Anonymous Coward | about 3 years ago | (#37149158)

I'm impressed too but not for that reason. it's not so much cutting their losses as knowing when an industry is in the early stages of its death throes. The PC is a dying thing. It'll be around a while yet, don't get me wrong, but it's going the way of the 68000-based workstation. The consumer industry is moving more and more to tablet and smartphone computing. Especially younger people, they do almost everything on those two devices, and have little need for a traditional PC any more.

There will always be PCs as a niche industry, just as how you can still buy a new Unix workstation from HP or somebody, but it isn't going to remain the dominant force we saw it be for the last few decades. And this should make slashdot people really happy, who tend to hate Microsoft and Intel. Those two players who were riding the coattails of the PC revolation since the 80's are going to become much less important in the post-PC future.

Re:I'm impressed. (0)

Anonymous Coward | about 3 years ago | (#37149362)

LOL....

and the cell phone carriers are more evil (1)

Joe_Dragon (2206452) | about 3 years ago | (#37149826)

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

Re:I'm impressed. (2, Insightful)

whiteboy86 (1930018) | about 3 years ago | (#37149190)

Yeah, erase all those years of RD, manufacturing know-how, engineering skills and general success in the PC scene. This is testament of utter executive disconnection, incompetence if not plain betrayal of the company, employees, HP's shareholders and loyal customers. Probably realising he can't compete with Steve Jobs, he cowardly axes the entire division so he doesn't need to personally deal with Apple's dominance and leadership.

Re:I'm impressed. (2)

Jim Hall (2985) | about 3 years ago | (#37149358)

Excellent rant, sir! But may I suggest that you forgot: "And anyone who disagrees with that is clearly a moron."

Re:I'm impressed. (1)

whiteboy86 (1930018) | about 3 years ago | (#37150068)

These executives should realize that not everything is measured by profit margins, HP is a public company and PC division is a very important western PC maker. In the upcoming digital economy and computer based world we in the west would like to use western made computers to avoid hardware level spyware and other malignancies of squarely China made computers, HP plays an important role here. IBM already lost it, to our dismay, this is another western failure in the making.

Re:I'm impressed. (3, Insightful)

gnasher719 (869701) | about 3 years ago | (#37149452)

I guess HP didn't notice that it took Apple and Steve Jobs good ten years of hard work to get where they are now. HP thought they could achieve the same with a one time payment of $1.2bn.

Re:I'm impressed. (2)

GaryOlson (737642) | about 3 years ago | (#37150140)

I endorse your portrayal of truth and honesty and insight. I assume you have no ambitions to become management?

Asus (0)

Anonymous Coward | about 3 years ago | (#37149044)

I'm pretty happy with Asus products. Perhaps they can fill the quality gap?

HP hardware business.... (1)

Cambo67 (932815) | about 3 years ago | (#37149086)

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

Re:HP hardware business.... (1)

Osgeld (1900440) | about 3 years ago | (#37149410)

its more like, hey pc devs finally ready to go beyond shoving 1 more virus scanner on windows, come play with these real computers, but be careful! it can kill you.

Re:HP hardware business.... (1)

jonwil (467024) | about 3 years ago | (#37150376)

Most likely HP would do what IBM did and spin it off/sell it.

HP obviously sees no future in the commodity PC market so it would make sense for them to get out of it and let someone else take it over.

corepirate nazis ponder fate of web/us (0)

Anonymous Coward | about 3 years ago | (#37149110)

hold on to your hedonisms.

confusion surrounds cancellation of $.5m terror tolerance stipends

the usual rumours; that we're going to get it, or nothing at all, on the
backend of our terror. so, once one lie is 'infactated', the rest becomes
just more errant fatal history.

disarm. tell the truth. the sky is not ours to toy with after all?

you call this 'weather'? what with real history racing up to correct
itself, while the chosen one's holycostal life0cider mediots continually
attempt to rewrite it, fortunately, there's still only one version of the
truth, & it's usually not a long story, or a confusing multiple choice
fear raising event.

world wide disarmament is taking place based on the pure intentions of the
majority of the planet's chosen to be depopulated, population. as the
biblical fiction based chosen ones have only one ability, which is
destruction for personal gain, they just don't fit in with all the new
life extending stuff that's we're being advised to ignore. life likes to
continue, advance etc... deception & death appear to have similar
ambitions. with try terror first tuesday upon us, wouldn't this be a great
time to investigate the genuine native elders social & political
leadership initiative, which includes genuine history as put forth in the
teepeeleaks etchings. the natives still have no words in their language to
describe the events following their 'discovery' by us, way back when. they
do advise that it's happening again.

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which are always changing, you butthead

Interesting scenario (4, Interesting)

Junta (36770) | about 3 years ago | (#37149208)

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.

Re:Interesting scenario (2)

sphealey (2855) | about 3 years ago | (#37149394)

> 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.

As long as the master vendor takes ownership of the commodity product (specs, warranty, service, etc) does it matter what the name is on the box? Historically IBM would (re)sell you almost anything except Amdahl, and I have purchased plenty of non-IBM stuff from them over the years as part of larger contracts. Same thing should apply to HP, and eventually they will have greater flexibility to offer other brands besides the ex-HP PC units if it makes sense to do so.

sPh

Re:Interesting scenario (1)

failedlogic (627314) | about 3 years ago | (#37149670)

IBM also makes really bad software. I'd say HP could start a profitable business by making better quality software. Then again ..... its HP.

Just a Label (1)

Sponge Bath (413667) | about 3 years ago | (#37149232)

We will now have to buy our Chinese computers from some other label company like Dell.

Dammit. (0)

Anonymous Coward | about 3 years ago | (#37149250)

Okay, so who apart from HP sells netbooks with matte-finish screens and Linux?

Fuck WebOS. HP were just about the only major manufacturer making hardware that was worth buying. (Apple's sad love affair with mirror-finish screens rules them out, and everything else seems to be cheap'n'tacky or infected with unavoidable Microsoft taxes.)

Re:Dammit. (1)

Guppy (12314) | about 3 years ago | (#37150048)

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.

Yes and their spinoff will be called.... (0)

i_want_you_to_throw_ (559379) | about 3 years ago | (#37149390)

Compaq.

Will HP TouchPad run Ubuntu, Kubuntu, or Andriod? (0)

Anonymous Coward | about 3 years ago | (#37149728)

Will HP TouchPad run Ubuntu, Kubuntu, or Andriod?
If it will, then when HP sells off the inventory, the mod geeks can take em and make em usfull again.

Open Source Portions of WebOS (1)

Cassini2 (956052) | about 3 years ago | (#37150328)

The open source portions of WebOS are at: opensource.palm.com/packages.html [palm.com]

Not sure if enough information is present to load Ubuntu onto an HP TouchPad.

HP/UX True64 (2)

sgt scrub (869860) | about 3 years ago | (#37149850)

No mention of the fate of HP/UX or True64.

Asus and Samsung (1)

cel4145 (468272) | about 3 years ago | (#37150002)

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.

HP you are not Google (1)

Latinhypercube (935707) | about 3 years ago | (#37150046)

Thanks for helping to turn the PC into an iPod.

now I'm not generally one for conspiracy theories (1)

Voyager529 (1363959) | about 3 years ago | (#37150154)

...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.

Business machines (0)

Anonymous Coward | about 3 years ago | (#37150176)

Hp should focus on a solid business lineup that's where the money is anyway.

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