Suggestion: They have to come up with a plan and stick to it. Through thick and thin. They have to be like Apple with the AppleTV. Don't make lofty pronouncements, call it a hobby, anything, but just keep plugging away incrementally improving it.
I don't care if it's a smartphone, a thin PC, or a mid-sized tablet with VoIP. Pick one and try to build it slowly, absorb punishment and learn from mistakes, but just keep plugging away instead of trying to hit one out of the park.
I was thinking of something similar. The cynic in me has this conversation at the board:
MW: "We have to develop a smartphone."
Board: "Uh, can we sell ink for that?"
MW: "What? NO you bonehead, its a phone you know you make
calls on it?"
Board: "Uh, but without ink how do you make any money?"
MW: "People buy them as fashion accessories doofus!"
Board: "Fashion accessories? I don't think we have
anyone here that knows anything about fashion.
Is there any other way to make money with phones?"
MW: "Oh sure, you make one and then sue everyone for patent
infringment."
Board: "Oh that we can do! We've got lots and lots of
patents. We'll get right on that."
But less cynically, I can't imagine how they could get into the smartphone space without first buying a company that had done the investment to know how to be in the smartphone space (and I'm not sure Palm counts, but maybe they were in tighter with Rim than we knew). Of course they could buy RIM ...
I am greatly depressed by this. I actually used a HP Veer for a short while and really loved the hardware and the concept of the OS. I prefer small phones, so the Veer hit a sweet spot for me.
But the quality control... there was a software bug around every corner which finally meant that I picked other options. If they had just spent a few more month polishing and then made their mobile push, the Veer or the Palm 3 would have been my phone to go.
And now they want to start it all again? No, thank you.
They already have few smart phones and had a great tablet device. They screwed up themselves. Remember $99 and $149 tablet device sale? At one point they were shutting down their own PC business. They just need a great visionary CEO.
I think HP rebounding from the Palm "incident" and somehow still managing to release a hit smartphone would be more miraculous then Apple rising from the Ashes.
I look forward to seeing what happens, but I'm very skeptical that a company such as HP has any chance at this.
I'm imagining a scenario where Meg Whitman is driving in circles in a parking lot, while Leo Apotheker drives the wrong way down the interstate, and you chime in to say, "At least Leo is driving somewhere." Doesn't make a lot of sense.
So basically, they are a computing company and need to offer a smartphone because in developing countries that's the only computer people will buy/need.
How will they ever compete to the likes of Apple/Aindroid partners who just dump yesterday's models for very low prices in those countries?
It's interesting that Whitman (HP's President) seems to suggest their "in" would be targeting smartphones specifically at consumers in developing countries. That's an interesting angle. It does suggest a lack of an overarching strategy, though. It looks as though they're simply scanning for any possible gap in the market without considering how such a move could fit within the company as a whole. (Not that the Nasdaq piece gives much to go on, of course).
Worse, it's a losing strategy. People in developing countries might not afford fashionable smartphones today, but they are well aware of them, and once prices drop after 12 to 18 months (which they inevitably do), they rush to "finally" snap them up. For proof of this, look at how quickly Nokia's profits fell once iPhone and Android devices became affordable.
Exactly. It's sad that HP appears to operate by sniffing out extremely short-term opportunities instead of laying the groundwork for anything vaguely long-term. Or, rather, they lay the groundwork then rip it up, lay the groundwork then rip it up.
how exactly will profits increase in a commodity market like the smartphone one? apple and samsung make profits - who else? which margins?
tablets I would understand, no mobile carriers to worry about, lots of room in enterprise to push into. apple is making great inroads right now - but no one else. android in the enterprise is DOA, ms surface not there yet.
I wasn't the one doing the market research, but they could have been thinking as developing countries grow economically their people are more likely to buy higher end phones. More people buying smart phones = more money in the market.
Platforms like iOS have network effects (i.e. App Store). Also people with a $500 iTunes library is less likely to buy another phone. These factors could be ways that make it harder to enter the smart phone market later on as other market players become more entrenched.
I guess that was rhetorical but anyways: "We have to ultimately offer a smartphone because in many countries of the world that would be your first computing device...we are a computing company."
I really hope they pick WebOS back up. It is an awesome product, by far beats Android in overall quality and ease of use and development, it would be a much, much better competitor to iOS.
If they move to the smartphone market they also have to reconfigure their distribution channels. PCs and Printers utilise different sales channels. In the western world, carriers hold the key to sales through subsidies, they can kill products by not offering them (Kin, original Nexus). In developing world countries, they need to get deals with the mobile retailer channel. Making a great product is only 1 part of the equation.
i really like that idea; both because i think we'll eventually get to the point where 3D Printers become mass-market consumer and enterprise products (like traditional printers today) so it could be great business for them, but also because i see little room elsewhere where hp could dominate a market like they once did with PCs and traditional printers..
What Leo Apotheker did to HP in his short tenure is borderline criminal. If I owned HP stock or were an employee I would be livid - but it's not totally his fault - it is also the Board's fault for bringing in a dinosaur with a complete lack of vision of the marketplace. I knew from the moment they hired him it was going to be a trainwreck. I'm sure many of the astute industry participants/observers here felt the same thing.
I don't care if it's a smartphone, a thin PC, or a mid-sized tablet with VoIP. Pick one and try to build it slowly, absorb punishment and learn from mistakes, but just keep plugging away instead of trying to hit one out of the park.