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Hewlett-Packard, with its market-leading PC business back in the fold, is still in the tablet game.
“I think we need to be in the tablet business,” HP CEO Meg Whitman told analysts and reporters during an Oct. 27 conference call. “We’re certainly going to be there with Windows 8, and we’re going to make a long-term decision about webOS.”
HP has made no indication that it will revive the webOS-powered TouchPad, which met with some critical praise but anemic sales following its July release in the United States. Six weeks after that debut, then-CEO Leo Apotheker announced HP was killing off the 9.7-inch tablet, as part of a major strategic realignment that also included the partial or full spinoff of its Personal Systems Group (PSG), the division responsible for manufacturing PCs. He also killed nascent plans to enter the smartphone market; as part of its $1.2 billion acquisition of Palm in 2010, HP had inherited the latter company’s line of webOS-powered mobile devices, including the Palm Pre.
Still on the table, however, is whether HP will decide to license webOS to other tablet manufacturers, or sell the platform to the highest bidder. In the latter case, the purchaser could acquire a host of patents useful in the increasingly litigious mobility space, even if they never use the software to actually create a device.
Whitman reversed the previous decision regarding the company’s PC business. “HP objectively evaluated the strategic, financial and operational impact of spinning off PSG,” she wrote in an Oct. 27 statement ahead of the conference call. “It’s clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees.”
During the call, Whitman framed HP’s immediate future as one of recovery from the “hangover” of Apotheker’s decisions. She acknowledged the “margin pressure” inherent in the PC business, but vowed to refine HP’s manufacturing process to squeeze more blood from the proverbial stone.
Todd Bradley, executive vice president of HP’s PSG, also hinted during the call that “we’re continuing to focus on a Microsoft tablet that we have and focus on Windows 8,” referring in the former case to a Windows 7 device targeted at the business community.
Due sometime in 2012, Windows 8 will pair the “traditional” Windows desktop with another user interface based on a colorful set of tiles, with easy switching between the two. The tile-centric interface is meant to operate on tablets, which in turn will allow Microsoft to finally compete against Apple’s iPad in that segment.
Evidently, HP is betting its tablet future on Windows 8 and its ability to attract consumers and businesses who might otherwise gravitate toward the iPad or an Android tablet. In the meantime, though, it could be some weeks or months before the company decides what to do with its webOS orphan.
There is some irony here. Before he decided to abruptly change HP’s course, Apotheker had publicly envisioned webOS as an operating system not only for smartphones and tablets, but also desktops and laptops. Had that vision come to pass, webOS would have emerged as an upstart competitor to Windows. But now, it seems, HP is fully back in the Windows camp.