HP to spin off PC unit, double down on cloud and software [rumor] | webOS Nation
 
 

HP to spin off PC unit, double down on cloud and software [rumor] 75

by Derek Kessler Thu, 18 Aug 2011 1:52 pm EDT

HP got its start in a garage in Palo Alto, making precision audio oscillators. In the years since, HP has expanded into calculators, servers, printers, desktop and laptop computers, software, cloud services, and – most recently – smartphones and tablets powered by webOS.

That may soon change, according to a report by Bloomberg. According to “people with direct knowledge of the matter,” HP is in talks to purchase software firm Autonomy for $4 billion, while simultaneously spinning off their personal computers division into a new business. Obviously this represents a watershed moment for HP and the computing industry in general – HP, like IBM before it – is acknowledging that the PC industry is reaching a crest (or already has crested) and will become a business of declining revenues and profits.

The question is “what does this mean for webOS?” Currently, the webOS Global Business Unit is slotted under the Personal Systems Group – the division that makes HP PCs. HP has been making noise about their plans for webOS since making their purchase of Palm over a year ago, with plans to expand the operating system into new niches like appliances and automobiles (though not likely in a form you’d recognize today) and even servers.

The way we look at it, there are three possible options for webOS and HP: HP could spin off the webOS GBU with the Personal Systems Group and let Todd Bradley and company run that ship. HP could also pluck the webOS GBU from the PSG and keep it for their new cloud-focused self. The final option would be to split the webOS GBU into software and hardware, with the cloud-focused HP taking software and licensing it back to hardware-focused HP PCs (this arrangement would sound awfully familiar to any Palm historian).

The latter two options would better open HP up to licensing out webOS. Without having a stake in Windows-running hardware, HP could develop webOS into a true desktop-caliber operating system of their own that ties back into all of their cloud services.

Regardless, the story of HP and webOS isn’t over just yet, and if Bloomberg’s report pans out, we’ll have our answers in just a few hours when HP releases their quarterly earnings statement and holds a conference call.

Source: Bloomberg; Via: Engadget

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75 Comments

It's over for webOS. There's no way that it fits into the strategy of a new IBM-like HP. It will be acquired by some overseas company - probably Chinese and probably used to make cheap knockoff phones for 2nd tier smartphone markets.

At any rate, even the transition will kill any momentum that webOS has. Just getting the deal done will take a year or two and, during that time, webOS will have no strategy.

webOS is dead ... long live AsusOS

I agree. I recently upgrade to a new cell phone and went with an android phone. I have a Pre Plus, which is no longer being used because of a lack of apps. Anyway, as for the future of webOS, it will not be used on any phones, but most likely servers and the like. That is the real reason HP purchased Palm....

This is essentially the official announcement of the death of WebOS.

An open source webOS might be successful as it could be less vulnerable to patent infringement claims than android.

Care to explain that one? Android is also open source and it seems that every day someone comes out of the woodwork with a patent infringement claim on Android.

yah, you're probably right. Just cause it hasnt been sued so far, doesn't mean it won't in the future. Wishful thinking on my part.

they're not getting sued because their market share is too small...and palm owns a boatload of patents...seeing that they started all this hand-held hoopla. when palm was in the market, i thought the rumor was htc was also inquiring, mainly because of the patent, but decided to go another direction. i wonder if they're regretting that now that apple is suing them.

i don't think it would be profitable though even if what you say is true. Android isn't making google tons of income.

Yeah, but then neither do the majority of Google products. It's slapping ads on them that makes the money.

yeah, that's not how patent law works. Open source can infringe patents as much as proprietary software.

I hope they pull webOS out of HP's bureaucracy. It has not done webOS any favors in the past year, and putting webOS in a smaller company might finally help it move at faster than a snail's pace. The scale of HP certainly wasn't helping.

A smaller company? You mean like Palm? Hmmm...

No, Palm was too small.

Palm was too small. HP was too big. Palm didn't do the marketing right. HP did the marketing OK but didn't execute the hardware right. Yada yada yada. So many damn excuses for one lousy operating system. Palm should patent the excuses - they've invented so many of them over the past few years. They must be worth a fortune.

ooooh, them are fighting words....

sick burn

HP will probably sell WebOS to Google.

I think there's a higher chance that one of Google's Android partners would buy webOS first, to hedge their bets in the face of Googlerola.

i second that. although not sure about buying webOS. but maybe licensing it. it definitely behooves the other phone makers to also consider other OSes on their devices. you don't want to get caught with your pants down in this market. motorola just got lucky putting all their eggs on the android basket when they were trying to turn things around after the razr. htc and samsung are intriguing...but if both do license it, they will obviously want to differentiate themselves from the other webOS phones. easier said than done...i mean, how do you slap sense/touchwiz on top of webOs, right?

i put my money on samsung buying webos. imagin webos tv

One of these is not like the others:
- Amiga
- BetaMax
- NextOS
- Microsoft Bob
- webOS
- Barney the Purple Dinosaur

NextOS - It was brought to Apple by Steve Jobs and formed the basis of Mac OS and, later, iPhone OS.

Someday, maybe WebOS will be another huge failure that spawned a success.

Perhaps. However, it won't matter to anyone who owns any current webOS device nor to anyone who has developed a webOS app nor anyone who reads PreCentral.net . Those are now detritus.

I wasn't fond of the HP acquisition of Palm. With Rubenstein moving up the HP food chain and this information, it looks like HP is trying to shed WebOS/ Palm dead weight.

How is Rubenstein moving up the HP food chain? He was demoted, if anything.

I'm thinking this is HP's way of getting rid of WebOS and taking the cost of the purchase of Palm off of HP's books. Also, I think this is the way to allow the PC unit to make Android tablets.

not even close. The Palm purchase was nothing for HP - folks at P|C see it as a main business for HP and it's really not. It's small change for them in their portfolio.

it's all ruby's fault

And Best Buy Sales reps.

Note sure why a few commentators here see this as a way of getting rid of WebOS.

The PSG is worth huge amounts of money. Much more than the tiny $1.2Bn paid for Palm. WebOS is very important in this equation, but it cannot be the sole reason nor the catalyst.

In fact if the rumour is true AND Palm is split back into hardware and software, it could be another opportunity to make it grow again.

The original spinoff of palm into hardware and software groups (selling palm os to Access) was to raise money to start a new development based on Linux, which became WebOS. HP need not sell anything to raise cash to survive. Given the inability of HP engineers (200 of whom actually transferred to Palm from their slate division) and Palm engineers to make hardware that competes with others, licensing WebOs to the likes of Samsung and Sony is the best way of increasing its market share.

agree - WebOS is irrelevant when HP heads talk of things like this. The $1.2 billion spent on Palm was nothing for them

In HP's defense, they did design, develop, test and ship tablet hardware/software in a little over a year which is impressive. Although in the end, when the HW doesn't compare to the currently shipping Apple product, I think it leaves the platform in doubt.

I would like to see WebOS core stay in HP. I think it can help complete HP's cloud strategy. PSG has not been known for developing cutting edge HW. Developing competitive HW for WebOS is better left to companies like HTC.

I will be an optimist and say this is a good thing. I vote for option 2, move webOS to the cloud group and build out its full potential

I'm personally hoping for option 3, with webOS being licensed to more than just HP's hardware division.

Well, if the doomsday folk are correct, it certainly explains the less than enthusiastic, I mean soft, launches that we have seen lately!

Thanks Leo. What did people think when you hire the guy that was a CEO for less than 2 years at a SOFTWARE Company. Are they really going to let him spin this off? Heck, spin off printers too to better focus on software and services. Why didn't he just go work for IBM.

Bad bad bad

one article i read mentioned that IBM got out of the PC business altogether and is doing fine. Maybe this is the first step in a sale of the pc group. i doubt it since it's still around one third of their revenue. but it's not a very low margin sector. who knows.

What is everyone talking about?

Wouldn't doing this help them concentrate on webOS?

Unless I am reading it wrong...

From what I recall, pretty much everything webOS was moved to the PC division, so not great news.

I heard this from inside sources when the new CEO took over. You guys have it wrong. If they are double downing on the cloud.. hello? webOS is the cloud. They bought it because it was a true cloud ready OS. In order to build out webOS and it's usefulness, it needs more software/services and infrastructure behind it. We all know HP hardware is sub-pare. This could be a good thing.

Here is a thought. Google just bought Motorola. Android now has it's own hardware. not something re-branded from HTC.

HTC is now teaming up with Beats Audio to bring Beats Audio to mobile. Beats Audio is already connected to HP. What if HTC dumps android and the lawsuits for a patent protected OS.. say.. webOS? We already see that HTC does Android and WinMo7 phones. With HTC getting sued for using android i'm sure they aren't tied to android as much as one might think.

I wish this could be true.

They are definitely up to something (HP) and the subject of discussion doesn't paint the whole picture. However, I would expect lots of info on what this all means later today.

It does seem like it's time for the annual "just wait for [event that never happens] to save WebOS" round of propaganda, doesn't it?

I dont think this necessarily means the death of WebOS.

If HP's new strategy is in the cloud and cloud based software, this in fact could mean a doubling down on WebOS. Since PCs are essentially dead for basic consumers, the focus is going to be on mobile OSes and how well they can interact with the cloud. WebOS could be HP's ticket to stay relevant.

Why? The cloud is platform-agnostic.

(Says in best Geeorge Takei Immatation) Oh, my!

Wow, the millionth time they declared it dead, yet i just downloaded like 5 different apps and have been using my touchpad all morning in meetings.

can we have a time of death at least?

Thursday, August 18th 4pm EST. Your TP will still work and the apps will still be available. It's just that a bunch of webOS development projects will be put on indefinite hold. Kind of like what happened to your Palm OS device in 2007.

Wow, people are really looking for any excuse to pronounce webOS dead. As mentioned earlier, you don't spin off your massive PC unit because a tiny group within that didn't meet expectations during the first month of sales. Do you guys think huge companies like HP just wake up one morning and change their direction? This has probably been in the works for a LONG time.

HP shareholders would balk at the idea of them gutting their PC business because they woke up one morning to find out Best Buy wanted to return a few units of a very small part of the business.

Why don't we wait for the announcement before proclaiming webOS is dead? If you haven't noticed, webOS is software, and they are focusing on software.

I just read this on the bloomberg terminal

*WSJ: HP Plans To Exit Tablet Business With Computing Spinoff. - Sources

From the WSJ:
As part of Hewlett-Packard's planned spin off of its personal computer business, it will keep the webOS software business but let go of the hardware, meaning H-P is shutting down its tablets business, people familiar with the matter said. H-P's tablet is the TouchPad, an iPad rival that went on sale in July starting at $499. Earlier this month, H-P cut its price 20%.

H-P got webOS when it acquired Palm Inc. in April 2010 for $1.2 billion. H-P may license the webOS software to others, the people added.

Read more: http://online.wsj.com/article/SB1000142405311190359690457651640305371885...

@tj0827 They said nothing about shutting down webOS printers. Which means webOS is not dead. =)

Wow - my prediction is happening sooner then I thought where WebOS would become a corporate offering only and for business professionals. So long consumer space.

PSD might not be sold. It might be spun out, as in a separate, publicly traded company. This should provide HP shareholders additional value. Heck, HP should bundle the peripheral (AKA printer) division and the PSD together, and spin both out. This would allow the company that remains to focus on servers, storage, cloud computing, enterprise software and integration services. Remains to be seen whether webOS and devices stay with HP. It will be, at best, a boutique business for 18 to 24 months, and will continue to require significant investment.

I wonder if HP employees will be able to use any laptop they want going forward. Man, could you imagine how many Apple laptops would soon pop up if folks were give a budget to go buy them.

So, does WebOS on every PC go out the window now. Was that another well thought out idea from HP before they announced it. These Execs are sharp cookies.

The re-branding under HP was supposed to be a big part of what would draw the mass market and HP's enterprise business customers to webOS. If the Personal Systems Division goes to Samsung (or pretty much anybody), then the branding becomes "Samsung webOS" or "Some New Madeup Name's webOS". Without the close ties to HP, webOS will have a difficult time breaking through. Heck, even WITH those ties, webOS is having a tough time breaking through. Just ask Best Buy.

HP -PLANS TO ANNOUNCE THAT IT WILL DISCONTINUE OPERATIONS FOR WEBOS DEVICES, SPECIFICALLY THE TOUCHPAD AND WEBOS PHONES.

came across the wires

webOS is officially dead :(

HP SAYS WILL CONTINUE TO EXPLORE OPTIONS TO OPTIMIZE THE VALUE OF WEBOS SOFTWARE GOING FORWARD

also coming accross the bloomberg wires.

HP -WILL DISCONTINUE OPERATIONS FOR ALL WEBOS DEVICES, SPECIFICALLY THE TOUCHPAD AND WEBOS PHONES BY END OF QUARTER.

came across the wires via bloomberg terminal

This just in:
"In addition, HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones. HP will continue to explore options to optimize the value of webOS software going forward."

It's over.

Brilliant! Suck a bag of &$&%$ HP!

you guys don't see the big picture:

"As part of Hewlett-Packard's planned spin off of its personal computer business, it will keep the webOS software business but let go of the hardware, meaning H-P is shutting down its tablets business, people familiar with the matter said.

Read more: http://online.wsj.com/article/SB10001424053111903596904576516403053718850.html#ixzz1VPRbgVr1"

webos is off to licensing land.

Okay, take a few *&*&* out of the bag HP. I'm still pissed though.

Yes, webOS will become the first OS to run without any hardware.

hp should patent an running an os on thin air

It's too late even for licences. Who is going to want to licence an OS that has performed terribly since it's inception among consumers. Someone might take a chance but then we're waiting another year for more hardware. Very sad but it's nice to not have to anticipate a device that will never come. I feel real bad for developers and especially the homebrew community.

Oh snap, nice knowing you P|C. It was a nice run. :(

Does this mean my newly frankenpre2 will cease to function?

it will spontaneously combust once P|C becomes Sammy | C

They better get webOS in the hands of Samsung and HTC real quick. I say this for the benefit of developers who really got jerked around.

Just read this on the Fidelity Investment site. Well HP, not sure what to say.

Beside's personally being a big HP supporter, we've been BIG HP PC/Server users at my employers.

So much for loyalty.

I guess the 'Droid is looking pretty good these days...

Looks like i'm returning my touchPad tomorrow.

I guess we all owe Sprint an apology for sticking to their guns, huh?

umm, No. =)

If more people/companies were on board HP could have met their goals for webOS devices. They didn't so they are going in a different direction.

It is my guess the HP was not planning on giving webOS devices made by them, much rope. They bought palm for webOS, not the mobile devices.

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