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HP Getting out of the PC market?
Message #1 Posted by Richard Garner on 18 Aug 2011, 1:46 p.m.

A news report on MSNBC said that HP has announced that it will be spinning off or selling its PC business. HP plans to keep the enterprise market but spin off the Personal Computer business to someone else. Does anyone have more definate information?

      
Re: HP Getting out of the PC market?
Message #2 Posted by Eric Smith on 18 Aug 2011, 2:14 p.m.,
in response to message #1 by Richard Garner

Didn't HP buy Compaq largely because it would improve their economies of scale to merge Compaq's and their own PC businesses? Couldn't they have saved a metric *@&load of money by just spinning off or selling off their PC business back then, and NOT buying Compaq?

            
Re: HP Getting out of the PC market?
Message #3 Posted by Seth Morabito on 18 Aug 2011, 4:29 p.m.,
in response to message #2 by Eric Smith

I've been so puzzled by HP's directions since Bill and Dave died. It seems like HP should have kept everything they spun off to Agilent, and spun off the computer division instead.

I wonder what impact (if any) this will have on whatever remains of the DEC properties? OpenVMS is still alive and kicking, I suppose they'll still be supporting that on Itanium, since it's part of their Enterprise group.

                  
OpenVMS
Message #4 Posted by Eric Smith on 18 Aug 2011, 10:41 p.m.,
in response to message #3 by Seth Morabito

Speaking of OpenVMS, I wonder why they haven't ported it to 64-bit x86? (Officially, that is; I wouldn't be surprised if they have it running in-house.)

Of course, if they did release such a thing, they'd ensure that it couldn't easily be made to run on commodity hardware, but it would give them a lot more flexibility in designing the enterprise-grade hardware to run it.

The first two items on this obviously very out-of-date FAQ are absolutely hilarious: OpenVMS on HP Integrity servers

Some of the other items are laughable now as well, such as item five which says that "Over the next few years, Itanium will exceed x86 performance by as much as 2X." That was apparently written around 2007, and yet Itanium is still significantly slower than x86. The supposed availability features of the Itanium are present in some Xeons, so Itanium doesn't win there either.

It was obvious at the Itanium introduction ten years ago that it was NOT the architecture of the future, and nothing has changed that since. The Itanium sales forecasts have been downgraded several times a year, and yet are still absurdly optimistic.

The conclusion I draw from it is that HP is perfectly happy to relegate OpenVMS to a legacy niche, and will likely drop it within a few years, like they did the HP 3000 systems and MPE.

Edited: 18 Aug 2011, 10:49 p.m.

                        
Re: OpenVMS
Message #5 Posted by John B. Smitherman on 18 Aug 2011, 11:05 p.m.,
in response to message #4 by Eric Smith

We still have 10 DEC VAX/VMS machines in service at work - 6 each 4300's, 3 each 4710's and 1 each Alpha. One had a power supply failure last weekend which had been in service since 1991. Over the last 20 years we've had very few failures - a small number of power supplies and hard drives. Not too bad.

John

                  
Re: HP Getting out of the PC market?
Message #6 Posted by BobVA on 19 Aug 2011, 6:16 p.m.,
in response to message #3 by Seth Morabito

Quote:
... It seems like HP should have kept everything they spun off to Agilent, and spun off the computer division instead...


Agreed. And it's an interesting alternative history to think about.

            
Re: HP Getting out of the PC market?
Message #7 Posted by Marcus von Cube, Germany on 18 Aug 2011, 4:49 p.m.,
in response to message #2 by Eric Smith

With the Compaq deal they acquired Digital and Tandem which are valuable assets in the high end market. The NonStop Systems which now are build mainly from stock HP hardware still run the unsurpassed NonStop Kernel operating system invented by Tandem for almost unlimited scalability and very very high reliability. It's the top of the line system (besides the Super Dome Unix boxes) for mission critical enterprise applications.

            
Re: HP Getting out of the PC market?
Message #8 Posted by Paul Gaster on 18 Aug 2011, 5:13 p.m.,
in response to message #2 by Eric Smith

Here is another HP story for today:

HP Killing WebOS http://gizmodo.com/5832291/

"A terse line in a press release from the company today reads "HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones." WebOS phones are great devices, much beloved by users, but they haven't sold well. It seemed like good news for webOS when HP bought Palm, but despite HP's clout, the phones still failed to catch on. There weren't enough apps. There weren't enough updates. And consequently, there weren't enough users. It was already clear that webOS was in very, very much trouble. Especially after Jon Rubinstein's recent departure."

So, that seems to be 1.2 Billion dollars wasted in under a year and a half. Is that some sort of record?

http://www.engadget.com/2010/04/28/hp-buys-palm/

"HP has just announced that it's acquiring Palm to the tune of $1.2 billion,.."

                  
Re: HP Getting out of the PC market?
Message #9 Posted by BobVA on 18 Aug 2011, 6:16 p.m.,
in response to message #8 by Paul Gaster

Hmm, I'm guessing that the chance of getting an HP-15c or Classic emulator port for my Palm Pre just stopped approaching zero and actually arrived there...

            
Re: HP Getting out of the PC market?
Message #10 Posted by sylvandb on 18 Aug 2011, 11:18 p.m.,
in response to message #2 by Eric Smith

Carly F. bought Compaq. It was nothing more than empire building. The PC part of the company was always low profit, and Bill and Dave spoke many times about the folly of pursuing profit in commodity products.

      
Re: HP Getting out of the PC market?
Message #11 Posted by Tim Wessman on 18 Aug 2011, 3:36 p.m.,
in response to message #1 by Richard Garner

FYI - Calcs falls under PSG.

TW

            
Re: HP Getting out of the PC market?
Message #12 Posted by Nigel J Dowrick on 18 Aug 2011, 4:17 p.m.,
in response to message #11 by Tim Wessman

PSG = Personal Systems Group? If so, then this BBC News story means that this is what is probably being sold off - is this correct?

Nigel (UK)

            
Re: HP Getting out of the PC market?
Message #13 Posted by Seth Morabito on 18 Aug 2011, 4:33 p.m.,
in response to message #11 by Tim Wessman

Oh dear. I'm hoping for the best.

Is there anything that can be said publicly before HHC about HP's planned attendance there?

                  
Re: HP Getting out of the PC market?
Message #14 Posted by Tim Wessman on 18 Aug 2011, 5:18 p.m.,
in response to message #13 by Seth Morabito

Well, I am planning to be there, as is Cyrille. GT Springer may show up for a bit, and two others who are based in San Diego.

Not exactly a secret. And no, I don't know anything else at all regarding the HP changes.

TW

Edited: 18 Aug 2011, 6:24 p.m.

      
Re: HP Getting out of the PC market?
Message #15 Posted by David Ramsey on 18 Aug 2011, 3:50 p.m.,
in response to message #1 by Richard Garner

Doesn't surprise me: especially since they killed Voodoo, HP desktop machines have been boring also-rans, no different from Dell or Acer or any of a dozen other PC box makers. They do have some nice workstations, though.

Edited: 18 Aug 2011, 3:50 p.m.

      
Re: HP Getting out of the PC market?
Message #16 Posted by Lode on 18 Aug 2011, 4:14 p.m.,
in response to message #1 by Richard Garner

What will this mean to HP printers?

            
Re: HP Getting out of the PC market?
Message #17 Posted by Glenn Dowdy on 18 Aug 2011, 4:25 p.m.,
in response to message #16 by Lode

Quote:
What will this mean to HP printers?

Likely, nothing.

      
Re: HP Getting out of the PC market?
Message #18 Posted by John B. Smitherman on 18 Aug 2011, 4:49 p.m.,
in response to message #1 by Richard Garner

I was speaking with some HP'ers this week and believe it or not they said that Compaq branded PC's sell more than HP.

John

      
Re: HP Getting out of the PC market?
Message #19 Posted by Howard Owen on 18 Aug 2011, 5:26 p.m.,
in response to message #1 by Richard Garner

IBM got out of the consumer PC market several years ago. Low margins and slow growth, even in good times, isn't a winning combination.

But since the calculator division is part of the potential deal (per Tim Wessman's post) this holds special interest for me. You might think that calculators were iconic products that HP would want to retain. I'm pretty pessimistic about that. IBM sold an iconic product, the IBM Thinkpad, to Lenovo with the rest of the PC business. Lenovo got the right to continue calling it the "IBM Thinkpad" for some time after the sale, in order to better enjoy the benefit of good will. So much for "iconic."

Who would a likely buyer be? Lenovo comes to mind right away.

            
Re: HP Getting out of the PC market?
Message #20 Posted by JustinM on 18 Aug 2011, 5:51 p.m.,
in response to message #19 by Howard Owen

My money's on Acer or Asus. The Thinkpads went to Lenovo in China, and I think only the computer companies in SE Asia will continue to produce commodity, low-margin systems. There's no growth left in desktop PCs and laptops are rapidly losing their niche to tablets.

I think in ten years your "computer" will be your phone. On the chance that you need a big screen and a keyboard, you'll just dock your phone like you do your laptop now. No more syncing a phone with a base computer - the phone will be it.

HP saw the writing on the wall this week with the stories of thousands of TouchPads sitting unsold in Best Buys. Apple and Google will be the 800 lb. gorillas of the next phase of personal computing so it makes sense to pull back to their core enterprise services and compete with IBM in the server room.

                  
Re: HP Getting out of the PC market?
Message #21 Posted by Ethan Conner on 18 Aug 2011, 6:46 p.m.,
in response to message #20 by JustinM

"in ten years your computer will be your phone" It's NOW my computer...and other people that i know. I was laid off earlier this year and found another job,filled out the application and completed the background check all on my iphone. I was even in the interim doing all the unemployment paperwork on the phone. The only reason i ever touch the laptop anymore is to "sync" the phone and that is coming to an end soon. The future is now.

                        
Re: HP Getting out of the PC market?
Message #22 Posted by JustinM on 18 Aug 2011, 10:53 p.m.,
in response to message #21 by Ethan Conner

You miss my point. I am fully aware that some people have replaced their desktops and laptops with phones. I wasn't saying that it will take ten years for phones to be capable of typical computing activities. My point was that in ten years a "computer" will be a phone - desktops and laptops won't exist anymore. We aren't there yet. Corporate offices don't have phone docks on their desks - they still have desktops and laptops. Have you written a 200 page report on your iPhone lately? What's missing is a means to seamlessly connect the phone to a real input device and a screen you can stand to look at for nine hours a day.

                              
Re: HP Getting out of the PC market?
Message #23 Posted by Ethan Conner on 18 Aug 2011, 11:13 p.m.,
in response to message #22 by JustinM

Not entirely.....no i have not written a 200 page document on my iphone. To quote a famous phrase among iphone owners.....or android, "there's an app for that." :)

            
Maybe a move back to engineering?
Message #24 Posted by snaggs on 18 Aug 2011, 7:38 p.m.,
in response to message #19 by Howard Owen

They still have printers, maybe theyll move the calculator division back there. It could be good news.

Daniel.

                  
Re: Maybe a move back to engineering?
Message #25 Posted by NateB on 18 Aug 2011, 8:34 p.m.,
in response to message #24 by snaggs

The calculator transitioned from engineering tool to teaching device years ago. I'd think that most of HP's scientific calc sales are due to the FE/PE/PS exams and financial calc sales are due to the financial and real estate exams.

There was mention that HP was going to stop producing the 12c. Perhaps this is why. Bummer. With this news I think the 10,000 15c's will sell out rather quickly. Hopefully I'll be able to get at least two...

      
Re: HP Getting out of the PC market?
Message #26 Posted by NateB on 18 Aug 2011, 8:24 p.m.,
in response to message #1 by Richard Garner

New story out now.

            
Who will buy the calculator division?
Message #27 Posted by snaggs on 19 Aug 2011, 1:14 a.m.,
in response to message #26 by NateB

Quote:
As a result, it needs to exit most of its consumer businesses, just as IBM did six years ago

Wow, I thinks thats a good analysis. IBM got rid of its printers too.

Who will buy the calculator division? A small interested firm might be better anyway.

                  
Re: Who will buy the calculator division?
Message #28 Posted by Walter B on 19 Aug 2011, 1:35 a.m.,
in response to message #27 by snaggs

Quote:
Wow, I thinks thats a good analysis.
(Sic!) That's no analysis at all - it's a comment. IMHO, a major share of the financial troubles in recent years stem from the fact these people were named "analysts" for whatever reason (maybe for getting higher wages?), and John Doe (hardly capable of spelling correctly :-( but writing about everything nevertheless) thinks that must be something close to scientific work. Forget it! They are traders, nothing more. [/rant]

Disclaimer: I apologize in advance for spelling and grammar errors - it's a foreign language for me.

                        
Re: Who will buy the calculator division?
Message #29 Posted by snaggs on 19 Aug 2011, 2:07 a.m.,
in response to message #28 by Walter B

Sorry :)

Been reading bloomberg (yes, more mba's) and theyre talking about the founders trying to block compaq buy etc, its interesting. They seem to think HP wants to re-invet itself as quality.

I'd have tomagree, I never asked them to keep reducing thhe price of the calculator. Most people would rather have rubber keys and something worth keeping for decades.

Quote:
While the PC unit accounted for 30 percent of sales last quarter, it only generated a 5.9 percent operating margin. Thatís less than at any other division in the company.

At least calculators anrt on the bottom!

Edited: 19 Aug 2011, 2:13 a.m.

      
Re: HP Getting out of the PC market?
Message #30 Posted by Calum Tait on 19 Aug 2011, 8:53 a.m.,
in response to message #1 by Richard Garner

Unfortunately, I can't see the calculators line surviving and I suspect it won't be long before the printers line gets spun off or sold off either. Both are de facto consumer products. Perhaps Kinpo will buy the rights and re-brand the calculators - or it may not be profitable enough for them. I think we are seeing one more step here towards the end of HP. It sadly reminds me of a once great British brand, GEC, built up over decades by the single-minded and famously penny concious Arnold Weinstock up to become Britain's largest and most profitable diversified technology company and a world leader in many fields. GEC succumbed to short-termist profit demands from gung-ho management and institutional shareholders. They saw in the 1990s, high profit margins from their telecommunications divisions, mainly due the expansion of the internet and subsequent dot-com boom. They decided this would be their "core business" and divested themselves of all the other divisions of the company which at that point were less profitable. They renamed the company "Marconi" and for a couple of years were popular investment due to high dividends. When the dot-com bubble burst and the telecoms equipment market went flat they had nothing to fall back on and within 10 years of being the largest conglomerate in the UK, they went bust. The old GEC was able to trade on its reputation for innovative, quality products and its wide portfolio of product types from components to systems allowed them access to the majority of markets and to cross-sell products. Further, the company's size allowed them to recruit in quantity the best engineers and designers who would then cross-fertilise ideas and solutions, even between separate businesses within the group. The parallels with HP are compelling and sad for me as we seem to learn nothing from historical errors of management. Is a time when enterprises and governments worldwide are reducing spending the right time to put all your eggs in the basket of enterprise level computers and software? Especially when an upturn in the market doesn't seem to be in near sight. When a company has invested heavily in acquiring a software platform (WebOS) which has a number of advantages over the market leaders and then further invested in providing an excellent tablet and phone platform for it, is it wise to withdraw the product 2 months after launch? It all comes down to short-term profit from a quick sale of businesses and instant cash injections resulting in large management bonuses. It is this greed and near-sightedness which is a fatal flaw in our current market system. I do hope that the HP name survives as it is a brand with a tradition to be proud of and of course I think it would be a crying shame if the last maker of RPN calculators were to cease production. I can't help but feel pessimistic though.

            
Re: HP Getting out of the PC market?
Message #31 Posted by bunuel66 on 19 Aug 2011, 2:40 p.m.,
in response to message #30 by Calum Tait

A business that makes nothing but money is a poor business. Henry Ford

There is one rule for the industrialist and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible. Henry Ford

            
Re: HP Getting out of the PC market?
Message #32 Posted by Namir on 19 Aug 2011, 3:21 p.m.,
in response to message #30 by Calum Tait

It seems that HP's most trusted analysts projected that the PC market will be fading and that HP, like IBM, need to hone in on rich customers and make a lot of profit. They have missed one important point. If the market they are gunning for is cash-rich, there will be many more players in that market. I really can imagine many Asian Indian and Chinese companies getting a big piece of the pie for that market AND providing these services for less than HP. What will HP do then??? Greed does not have patience and that's a bad thing. I remember when Microsoft came out with MS-Word and Excel for DOS. They were not instant hits. This did not push Microsoft to ditch these products. Instead they stood by them and refined them. When Windows 95 rolled out Microsoft was able to jump ahead of the line and make their office products the best sellers, dethroning Word Perfect who had the lion's share in the word processing market, and likewise Lotus 123. Patience and strategic move pays off--not that they are easy or simple.

Namir

                  
Re: HP Getting out of the PC market?
Message #33 Posted by Massimo Gnerucci (Italy) on 19 Aug 2011, 3:49 p.m.,
in response to message #32 by Namir

Quote:
I remember when Microsoft came out with MS-Word and Excel for DOS.

Ok for Word, but Excel?

Microsoft made Multiplan for DOS and Excel for Windows in 1987, after several months of delay (I remember well since I was eager to test it against Multiplan and Lotus 1-2-3). They released it for Mac at first.

Greetings,
Massimo

Edited: 19 Aug 2011, 3:51 p.m.


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