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Right Place, Wrong Time: How HP Blew Its Mobile Vision

On Monday Google bought Motorola announcing itself to the world as global superpower in mobile hardware and software. On Thursday Hewlett Packard ran away from both

Just 48 hours ago the the world’s largest PC maker announced it would spin off its Personal Systems Group and cease development of webOS with immediate effect. The former makes the company’s desktops, laptops, tablets and smartphones, the latter as recently as March was professed to be their saving grace.


“There is a clear movement in the consumer PC space,” reasoned HP president Leo Apotheker (pictured). “The Grabs Top Spot in Mobile Computer Shipments Thanks to iPad/article22485.htm tablet effect is real. The TouchPad is not gaining enough traction in the marketplace. Our PC business needs the flexibility to make its own decisions.” His logic was sound, but it is symptomatic of the HP’s latest attempts to fix its terrible sense of timing.

The habit started 10 years ago. On 2 September 2001 HP bought rival Compaq. At a cost of $25bn it was the biggest takeover in history.

“This is a decisive move that accelerates our strategy and positions us to win by offering even greater value to our customers and partners,” said then CEO Carly Fiorina. “In addition to the clear strategic benefits of combining two highly complementary organizations and product families, we can create substantial shareowner value through significant cost-structure improvements and access to new growth opportunities.”


Just three years later IBM, founder of the personal computer, sold its PC business to Lenovo for $1.25bn. Negotiations had taken 13 months and the price was close to a fire sale. “Their goal was to get out of the PC business because they don’t make any money out of it,” said Gartner analyst Martin Gilliland at the time. HP took no notice. In September 2006 HP was still buying PC builders, this time Voodoo and IBM’s realisation has only registered with HP five years later. “If HP spins off their PC business…. maybe they will call it Compaq?” quipped Dell founder Michael Dell this week.

Four months after the Voodoo purchase Apple unveiled the iPhone. Apple had been working on the project for four years. In April 2010 HP bought Palm. “The smartphone market is large, profitable and rapidly growing, and companies that can provide an integrated device and experience command a higher share,” enthused HP’s Personal Systems Group executive VP Todd Bradley, speaking as if from a time warp. 26 days prior to this the Apple iPad had gone on sale…

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