

HP to Keep PC Division   - sl_
http://www.hp.com/hpinfo/newsroom/press/2011/111027xa.html

======
codezero
With all the bad moves HP has made recently, this is a good one.

Although my testimony is likely not worth much, I feel it's important to
convey why I think HP's PC division is worth keeping around.

My boss' HP desktop died, he brought it to me to see if I could fix it
quickly, and I went through the steps on HP's website to "troubleshoot" it. I
was pretty sure the power supply was dead, and I sent an email to support
explaining all the steps I went through to determine that. There was an option
on the page to list experience level, and I put it at the max.

The first response I got was that they would send a shipping box for it and
that they would replace the PSU.

They 1) trusted their customer and 2) didn't back and forth, wasting their
time and mine.

I got the box within a few days and returned the system to HP. It was back
within 3 days (this is a week total from initial contact to returned system),
and the hard drive wasn't even reformatted.

This is the kind of service that I am used to from Apple (fix it and forget
it), and it renewed my hope in HP, but this was a little over a year ago, so
who knows what's going on now.

~~~
martey
While I have heard good things from a couple of people about HP's business
support, my personal experiences with their consumer support division have
been wanting.

My HP laptop has a locked BIOS that prevents you from replacing the wireless
card. I sent them an email message describing the BIOS error message that was
returned and asking for more information about what were valid wireless cards
for the machine. I received a reply telling me to reinstall my wireless card
drivers. Over the next few days, I tried to get someone who understood my
issue, but was repeatedly told to reinstall drivers, to reseat the card, and a
variety of other solutions that seemed to come from some wireless
troubleshooting customer support script.

I called, and the person I talked to eventually told me to send the computer
in, because "the depot would have a different unlocked BIOS that they could
put on". When my computer arrived at the depot, I talked to:

\- a technician who was sympathetic but very confused about why phone support
told me to send my computer to the depot,

\- two case managers who started out by telling me that they were "non-
technical" who I had to explain what a BIOS was, and

\- a rude senior case manager who yelled at me for wasting everyone's time and
told me "if you bought a car with a Sony stereo, you wouldn't expect a
Panasonic stereo to work in it". When I told him that he was being rude and I
wanted to provide feedback to someone about it, he told me that there was
nobody else I could talk to, as his superiors would not want to hear from me.

After a day of not hearing anything from the depot about when my computer
would be returned, I called a HP executive support number I found on
Consumerist or some other forum. The woman I talked to was exceedingly polite,
but admitted she was non-technical, but then told me that my issue was "it was
because HP wanted it that way" and even though it is in a user-accessible
location, trying to install a different wireless card would void my warranty
"just like installing Linux."

A week or so later, HP released a BIOS update to include more wireless cards
on the internal whitelist, in order to support the version of the laptop in
the Small Business store (same components, starting price was $300 higher).

------
mrich
Wow. What is going on there? At first I thought Apotheker was hired to
complete some "unpopular" tasks, and then a new CEO could start over. But it
seems like the board was completely asleep while Apotheker made his decisions.
I am looking forward to some massive lawsuits brought against these people.
Apotheker probably was the most clever guy in this, and knew that he could
make a quick 20 million even though he would be fired. Would be interested in
insights from HP employees.

~~~
sliverstorm
I suddenly find myself wondering if someone wanted the stock price to crater,
to make a takeover or mega-buy-in cheaper.

~~~
pedalpete
Interesting theory, and with the history of this HP board, this is actually a
very minor possibility.

<http://en.wikipedia.org/wiki/Hewlett-Packard_spying_scandal>

You've made me wonder if the quality of the algorithms used for trading make
it near impossible for the SEC to track these sort of criminal activities.

------
aresant
Understanding HP's dilemma is as simple as looking at the comps.

HP is trading at 6.5x P/E currently.

Yet HP's consulting business should be worth more separate (IBM at 14x,
Accenture at 18x)

And HP's hardware business should be worth more separate (compare Toshiba at
12x, Apple at 15x, even Dell at 9x)

As a result I understand why they allowed Apotheker to do what he did.

Cut ONCE, bleed heavily and launch two strong, focused companies that aren't
burdened by the distraction of the other and can unlock maximum shareholder
value.

BUT wow, do they have a fricking communication challenge.

Every press release (even this one) is dry, complicated and nonsensical.

The current press release talks about a "data driven decision".

Why can't they just explain what they're doing and why?

Come on HP.

~~~
nobody314
Splitting off HP's hardware business doesn't suddenly make it worth the same
as Apple's

That's like claiming if it spun off it's discount coupon business it would be
worth the same as groupon.

~~~
pedalpete
He did provide PE ratios for competitors as well, and HP is the largest PC
maker. He isn't valuing them the same as Apple, just that the PE ratio should
be similar.

~~~
kb101
The line of reasoning applied here escapes me. In what way are the hardware
and consulting business lines distractions to one another? It's like saying a
car company's manufacturing business is going to get distracted by the company
racing team, because it's possible to draw up different P/E ratios for the
two. This overlooks the fundamental and inextricably interlinked business
relationships between the two. And it casts aside all kinds of follow-on
benefits, such as market & mind share, the halo effect, cross-pollination of
new business ideas and seeding of innovation.

------
w33ble
First good decision they've made in a while. Too bad they are unlikely to
reverse the WebOS decision.

I have to wonder how much this had to do with not finding anyone to buy it at
a price they were willing to take.

------
barredo
Will they keep WebOS?

~~~
thought_alarm
WebOS has suffered from severe performance and stability problems for three
years, with no solution in sight.

This was demonstrated both when the WebOS application layer received a 2X
performance boost when ported to WebKit on iOS, and again when Android was
ported to the TouchPad hardware and was found to be quite a lot faster than
WebOS.

It's quite clear that it is a fundamentally flawed architecture without a
future. It's too bad; there's some interesting stuff going on in the
application layer, but the underlying OS is a complete turkey.

~~~
ScottBurson
Agreed (as a former Pre user).

I think they should rip out whatever kernel they're using and replace it with
BeOS, which has wonderful real-time and multitasking behavior.

------
redorb
This decision is better than their CEO pick (meg whitman) but these big
decisions affect each other... I don't see much future but decline for HP

~~~
reissbaker
Kinda makes me like Whitman more, though. Wish she'd been around before the
WebOS disaster.

~~~
ScottBurson
The only credit I give Whitman for this is that she realized that the markets
(both PC customers and the stock market) had already spoken, and they did not
like the spinoff plan. Analysts had already pointed out that existing
synergies (the supply chain, etc.) would be lost. I think it was pretty much a
foregone conclusion that the spinoff decision would be reversed, although I'll
grant Whitman the benefit of the doubt and assume that she really did study
the question deeply and with an open mind.

I doubt she would have reversed the WebOS decision even if she had had the
chance. As much as we techies may bemoan it, the fact is that for HP to see
any profit from the Palm acquisition, it would have had to suffer losses for
several years and then try to recoup them in an extremely competitive
environment (read: low margins). I think the real mistake there was when Hurd
bought Palm in the first place, and I see no evidence that anyone in HP's
upper management thinks otherwise.

------
InclinedPlane
Personally, this fiasco seemed to me to mirror Netflix's recent missteps, just
with far less press.

~~~
Samuel_Michon
_"You know what HP should do? They should acquire Netflix. Then a week later
back away and say “Never mind.” Then a month later go ahead and buy Netflix.
Those two are made for each other."_

–John Gruber

