HP Begins Layoffs at webOS Division - PC Group Next?

 
 
By Chris Preimesberger  |  Posted 2011-09-20
 
 
 

The fallout from the bombastic Aug. 18 Hewlett-Packard corporate strategy left turn is beginning to take shape in the form of real effects on people.

HP confirmed Sept. 20 that it has started workforce reductions in what remains of its webOS group and Palm smartphone business. Several staff members already have left on their own volition; more than 500 are expected to lose their jobs involuntarily in the next few days.

The Personal Systems Group, which also is being decimated by the new corporate plan, is expected to be next up for the chopping block.

An HP spokesperson sent this memo to eWEEK: "As communicated on August 18, 2011, HP will discontinue the development of webOS devices within the fourth quarter of fiscal year 2011, which ends Oct. 31, 2011. As part of this decision, the webOS GBU is undergoing a reduction in workforce. Today's actions are part of this initiative.

"During this time, we stand by our commitments to our webOS customers and will work to ensure that support and service for customers are not adversely affected. HP is exploring ways to leverage webOS software."

HP Dropped Some Early Hints

HP offered a clue to its future plans back on July 11, when it transferred webOS division head Jon Rubinstein to the Personal Systems Group a mere five months after a splashy media event introducing the webOS-run HP TouchPad and the Pre and Veer smartphones. HP replaced Rubinstein with Stephen DeWitt only about a month after the TouchPad and the new phones hit the stores.

Perhaps another early indication of change was when one of the lead Palm Pre designers, Peter Skillman, left HP immediately after then-CEO Mark Hurd was asked to leave HP in August 2010.

Former SAP chief executive Leo Apotheker, who eventually replaced Hurd as HP's chief executive in November 2010, was known as a software advocate with no experience in the mobile world; this was another-albeit more apparent-clue as to HP's long-term plans, one that was discussed long and hard in the IT media.

A former Apple employee who contributed significantly to the Apple iPod and iMac, Rubinstein was named CEO of Palm in June 2009, just days after the successful launch of the Palm Pre. HP then bought Palm in April 2010 for $1.2 billion, and Rubinstein, naturally, moved to HP. Rubinstein now answers to HP Executive Vice President Todd Bradley in the PSG, but the future doesn't look so good there right now.

At this point, no one knows what HP will do with the webOS and personal systems IP and facilities-the main ones are located in Houston and in Northern California. HP has indicated that it is considering licensing deals and perhaps an outright sale of webOS.

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