McKinney: HP was supposed to leave Palm alone for three years, lacked the "patience for innovation" | webOS Nation

McKinney: HP was supposed to leave Palm alone for three years, lacked the "patience for innovation" 168

by Derek Kessler Tue, 13 Mar 2012 11:05 pm EDT

Phil McKinney

Phil McKinney left his position as HP CTO and chief big thinker at the end of this past October. Since then he published a new book, Beyond the Obvious: Killer Questions That Spark Game-Changing Innovation [hardcover, Kindle, iBooks] that explores his experience as an innovator. In promoting Beyond the Obvious, McKinney sat down for an interview with "strategic marketing expert" and fellow author Rick Mathieson. Most of the interview touches on what's in McKinney's book, but in part four of the interview he steers the discussion towards what went down with webOS and McKinney's last few months at HP. We'll let McKinney do the talking here:

"[The Palm acquisition] was going to be a long term effort. Palm was struggling and HP was stepping in, doing the acquisition, and we were basically going to take three years hands-off. Palm was basically going to get cash infusions, resources, and expertise. But Palm was going to be given three years to basically get itself positioned to be a market leader in its space. Now, fast forward to July of 2011 and, one, you had a swap out of the CEOs - Leo comes in as the new CEO - and HP, for whatever reason - I was not a part of this decision - made the decision to kill it, one year into the three year program. This is an example of not committing long term to the resources and not having patience for innovation."

McKinney notes that he was part of the team that drove the acquisition of Palm and that there are always challenges to overcome with trying to get a large organization like HP to be innovative. As the existence of a three-year plan for Palm implies, the challenge is sticking to a long-term plan that ignores the quarterly financial reports in favor of the long view.

It's equal parts hard and frustrating to imagine where Palm and webOS would be today had HP not pulled the plug on hardware development and essentially killed (and since attempted to revived) the OS. It's been seven months since former HP CEO Leo Apotheker made the decision to kill webOS hardware, and during that time we expect that we would have at the very least seen the release of the HP Pre3 and TouchPad Go, plus whatever else HP might have been working up.

For his part, McKinney still uses a webOS smartphone and a TouchPad.

Source: Rick Mathieson (Part 1, 2, 3, 4); Thanks to Haakon for the tip!


Yes, Leo and board, along with HP marketing were personally responsible for bad product placement, high price and lack of content on TP launch day.
Fact is, webOS is capable to run flash videos, is capable to decode h264 and x264, and is capable to display e-magazines. None of that was avail to TP buyers at launch.
And you are saying this is hardware and software engineers fault? You are saying that Rubinstein and Bradley were in position to negotiate terms of cooperation with Hollywood moguls or publishing moguls? Simply, webOS was abandoned and doomed. Same thing would happen to it even if it performed better.

they surely were not expecting to lose money. They surely were expecting people to buy the devices in greater numbers. They bought autonomy. It turned a profit.

They invested a billion. I'm positive HP did not expect it to lose 332 million in the second quarter they had. I'm sure they didn't expect the loss to be getting bigger the following quarter with the release of a new product, the expected pre three. I'm sure HP expected a much more positive effect on the balance sheet. But that only comes is people buy the device and few people wanted it.

bottom line is if the public had wanted to buy the devices they'd still be making them. Sad but its' the truth.

hardly a fair comparison. Google's business model is different plus they have an ecosystem, they dont' make phones or tablet hardware they have several other companies do, they have way more cash to burn the hp, again unlike hp they aren't trying to make 100% of the hardware, and sorry but android with it's cloud services, better email, it's google based apps like youtube, maps, navigation that were never updated for Palm, and voice commands and music beta has many many more features then webos. Webos has multitasking! woooo! that's. it. Not to mention android has a robust app catalog of enough apps to keep people happy,

HP on the other had none of that nor the already big market penetration and unlike Google, HP was trying to make a profit of of selling webos phones, Google really isn't.

Sure, you know exactly what they were thinking in the boardroom, and, have much better insight than John did; they should have hired YOU to help them see the light, I guees.

From all accounts, your take is so wrong, it isn't even funny.

But, keep believing as you do - you only are convncing yourself; most here followed this in very great detail and the facts are quite different.

Ooops, there I go again, talking about what we know, versus what you say ....

Shame on me.


Yeah, I'm only using the quotes from the CTO, acquisitions on record, cash on hand on record, and market non-performance and other figments of my imagination to buttress what I say.

Pretty much just making things up as I go, obviously.

blame Leo all you want but he didn't cause the failure of the Pre, the Pre+, the Pre 2, the Pixi etc. That failure existed before he got there. And the phones they tried to make after he got their were just bigger or smaller versions of an already failed design.

It needed a complete redesign and someone with an ounce of style to design the look.

Leo is the one to blame - even though the TouchPad and Pre style devices failed, he is the one that killed webOS. Heck, he killed HP and I seem them being bought if things don't turn around. No way around it.

Even though the TouchPad didn't sell, the Veer was a joke and the Pre3 never saw an official release, HP was committed to make things better. They had additional phone designs ready, a TouchPad roadmap, etc. This was all in the plans.

Leo, and the BOD that approved his hire are to blame. I hold Leo accountable and think the guy is an absolute disgrace. His decisions around webOS are not the primary reason, there is more too it and he was a lame duck. I'll be the first to tell him how big an idiot he is if I ever have the chance.

crappy sales killed webos. He didn't kill HP. HP was declining during hurd check the stock price plummet in the 3 months before Hurd left. And they had quarters of declining profits.

leo is the scapegoat for disgruntled webos fans mad cause the massed didn't like the phones. None of the webos phone caught on.

i'm sure he'll be crushed to hear your opinion of him as he swims in his money.

The Veer was a horrible mistake. (any final numbers on that idiot toilet puck?) Releasing it would have been bad enough, but they soft launched it as if they were embarrassed. I truly believe that a Slab/Candy bar webOS device would have made some strides if it had come out first.

Has anyone figured out how much Leo got from other company's for destroying webOS. We know how much his severance pay was but how much did he get for his mutiny.
If Palm was to be "left alone for three years" it seems to me someone at Palm should have said something.
Why is McKinney just now releasing this information in a "BOOK",
its all about the all mighty dollars.
I'm not chastising McKinney at all but he could have been a "whistle blower" a long time ago and most likely many others.
What happened at Palm for all these people to not step up to the plate. Where they trying to save their jobs?
I don't expect anyone to answer these questions because most don't care anymore beings its history and now we have open source going on.
I still have my original Pre from two years ago and a 32 gig Touchpad I bought two weeks before the fire sale and Staples was kind enough to refund and honor the fire sale price and I have no problems with either. If Sprint would sell the Pre 3 I'd buy two right now.
If my Pre was to break I would go back to my Treo 755p.
Its just a real bad thing having Leo try to destroy us but I truly believe we will prevail and Leo will be cursed for eternity.
To everyone still working on webOS, thank you!

So they were supposed to leave Palm alone for three years. Who did they make that agreement with? Palm? Who at Palm is going to step up to the plate? Aren't they HP employees? Who's going to sue HP for breach of contract? Palm? It's a subsidiary of HP so I guess HP would be suing itself. Once the transaction has been consummated, it doesn't really matter what HP was supposed to do does it?

It's easy to play armchair quarterback. HP did give up on Palm...

But I can't exactly say with confidence that had Palm been left alone they would have necessarily succeeded or a simple cash infusion would have made all the difference. Unfortunately the track record prior to HP's acquisition was not painting a good picture for Palm either. Again it's easy to critique as an outsider but there are some things that we just don't know.

For instance, I'm wondering the whole ipod spoofing fiasco...whether that was partly Jon trying to tie into his previous "accomplishments" and also an early admission of the need to build that aspect of the ecosystem which was already in place with itunes. We just don't know and I'm not willing to join the crowds with pitchforks and start pointing the fingers. I think there are potentially many culpable parties and things that just made a perfect storm of disaster that led to the things that happened today.

i never used a Pre2 or Pre3 so i can't comment too much. I do have a Pre+ and it just seemed not there but great in some concepts. however seeing what was to be released last year just seemed more of the same which worried me. I liked what they started but I just felt the market moved so far ahead that they really needed to step it up. Again it's not fair to make too many conclusions...who knows what they would have done with the extra money? But there did feel a bit of stubborness in sticking to the same old forms....personally I liked having a real keyboard...fine with that but even with just one year after the acquisition it didn't seem they positioned themselves towards making game changers which is what they really needed. i'm not talking about cramming fast processors in a phone and call it a's the overall experience. if they could take the level of innovation and something unique like they did with the touchstone technology (which is still cool to this day) but put that into the phone design/feature itself and have it as polished as an iphone (disclaimer: not saying it is the perfect device either) then I would say more confidently the problem was simply lack of time and money.

As a Palm and webOS fan though all I'm directing my energy towards is hopefully seeing a legitamate challenger to what seems currently just a two horse race in the mobile OS space.

IMHO one route HP could take is that they can ride under the coat-tails of android for the consumer space in terms of what I am reading about the whole OpenMobile initiative and differentiate themselves from other OS offerings with tying in webOS with their various analytics acquisition and thus go for the "prosumer' market. maybe that is their mobile OS play and why they are willing to invest in webOS who knows?

i think what is most important to ask in all of this isn't the what if's scenarios but more what seems to be a common affliction of companies that they once started out great and then when they get too big they wither in innovation and get scared of taking risk or suddenly lose focus. this seems to be a very big problem that no one i feel is addressing...happened to great names....HP is one....Honda, Kodak, Polaroid, etc. etc.

alot of you are on the Veer's case saying it was a "joke". But remember , it was a ENTRY LEVEL DEVICE!!!!!!!!!!!! It wasn't supposed be the all powerful one ! The Veer wasn't pretending to be the top end phone! It positioned itself as a smartphone for the dumbphone crowd & wasn't pretending to be all powerful!

Then don't release it first when the tech world is waiting to see the next gen webOS devices. A third grader could have had a better strategy than HPalm.

And again, the Veer is/was an embarrassment.

Let's get our share of the smartphone boom by releasing a less capable, but efficient ultra small smart phone... with a keyboard! BRILLIANT!

It’s a real shame too. I went to one of their Enyo Dev Days over last summer (early June), and I was told not to get the Pre3 because a new phone would be coming out in the next few months that would really be their next superphone. And we never even got to see it. Was going to be a candybar too, if I remember correctly. It’s a real shame what happened to such a good company.

The only good thing HP did was sell me nice tablet for 100 bucks other then that HP blows i will never buy anything they make or promote ever again i wish them nothing but bad luck and hard times.

@slayerpsp yet you took the time to make a rant on here about one of their products . And no need to wish them bad luck , as you can see , they've had enough bad luck .

It was the HP management that failed WebOS!!!! I am shocked. And I thought it was WebOS itself that failed HP