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  1.    #1  
    Everyone who knows me has heard me go on and on, ad nauseum, about my frustrations with Apple, it's big brother corporate policies, and how it's very success had weirdly stunted creativity from the tech world. Apple has created an entire field of ' me too' companies desperately and stupidly trying to beat Apple at it's own game. Not surprisingly, they've failed miserably. Not ONE company bothered to understand how Apple had gotten the market lead in the first place. And that is why I, and so many geeks like me, fell in love with WebOS: It respected the things that Apple does brilliantly, but approached them from an elegant, open techno-garden angle that was very reminiscent of the underdog that was Apple in the 80s.

    But Palm got innovative and all phoenixy (rising from the ashes) too late and, through a hopelessly mismanaged launch and marketing plan, went bankrupt. And then came the savior of this small group of creative innovators: HP. It seemed a perfect pairing: a small creative group, and a deep pocketed company with the capital and the marketing power to give a brilliant new operating system the launch it had deserved in the first place. Until last week, with no warning to it's own employees, it declared an end to all WebOS devices and declared a fire sale on all these devices, effectively throwing away around 3 billion dollars used to acquire Palm and further develop WebOS. And the company did this after just over two months on the market. And then a magical thing happened, EVERYONE wanted one of these devices.

    Through sheer ineptitude and mismanagement, HP struck on the strategy that ALL pretenders to the Ipad throne should have been pursuing from the beginning: when there is a clear leader in a field with few if any weaknesses, you MUST best them dramatically in price to build a user base, create brand loyalty, and expose the market to what makes your product worthy. No matter how cool your ad campaign is (and, for the record, HP did a horrible job.....Russell Brand and Lea Michelle? Really? They managed to choose two celebrities that I would actually pay to not have in my home or on my tablet.) People can't get passionate about your product until they own it. Once they own it, they can become zealots, and then missionaries, and then the market share of that company grows, and then it becomes......Apple.

    What happened this weekend is that HP has sold 350,000 Touchpads this weekend after flipping it's few loyal fans the bird and quietly slipping it's passionate development team pink slips. That makes the Touchpad the second most popular Tablet computer in the world. A goal that RIM Blackberry, Motorola, Samsung and, indirectly, Google, have all thrown millions, if not billions of dollars at. If there is another example of a massive company Forrest Gumping it's way to a goal in this way, I am unaware of it. Imagine if a group of investors bought a race horse that continually failed to live up to expectations, so they decided to cut their losses and shoot it in the head. They miss, the horse bolts, and promptly sprints past all competitors winning the race.

    Now even assuming that a quarter of these sales are simply people trying to get rich reselling the Touchpads on Ebay, by the end of next week HP will have 500,000 Touchpads in the wild. WebOS developers have already reported dramatic increases in profits this weekend. Where there is profit to be made, developers will go. The very developers that HP tried so unsuccessfully to court in the first place. The servers of major online electronics retailers have collapsed under the demand, there have been lines around the corner at every brick and mortar electronics store in the country. In short, a result that every marketing team dreams of.

    So the question is....what will HP do? Knowing Corporate America they will not change their minds and embrace this bizarre reversal of fortune. But for the sake of innovation I truly hope they do. Even diehard Apple fans should see the need for an actual viable alternative to iOS. Without competition, Apple will grow stale and stop innovating...like Palm did before it's death.

    Grow up HP. Admit you were wrong, and thank your lucky stars you have been given the things every business hopes for: amazing developers (with more to come with profit in sight), a persistently loyal fan base, programmers who love the development environment, and, most of all, a half million customers waiting to become zealots. You have all of these things, and you don't deserve one of them.
    Last edited by Macros746; 08/22/2011 at 09:14 PM. Reason: Paragraphs
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  2. #2  
    paragraphs welcome
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  3. akshunj's Avatar
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    #3  
    Quote Originally Posted by Macros746 View Post
    Through sheer ineptitude and mismanagement, HP struck on the strategy that ALL pretenders to the Ipad throne should have been pursuing from the beginning: when there is a clear leader in a field with few if any weaknesses, you MUST best them dramatically in price to build a user base, create brand loyalty, and expose the market to what makes your product worthy.
    Nothing new here my friend, MBA class 101: This was how Lexus broke into the luxury car market and gained a solid foothold despite dinosaurs BMW and Mercedes guarding their turf...
  4. #4  
    Quote Originally Posted by Macros746 View Post
    Everyone who knows me has heard me go on and on, ad nauseum, about my frustrations with Apple, it's big brother corporate policies, and how it's very success had weirdly stunted creativity from the tech world. Apple has created an entire field of ' me too' companies desperately and stupidly trying to beat Apple at it's own game. Not surprisingly, they've failed miserably. Not ONE company bothered to understand how Apple had gotten the market lead in the first place. And that is why I, and so many geeks like me, fell in love with WebOS: It respected the things that Apple does brilliantly, but approached them from an elegant, open techno-garden angle that was very reminiscent of the underdog that was Apple in the 80s. But Palm got innovative and all phoenixy (rising from the ashes) too late and, through a hopelessly mismanaged launch and marketing plan, went bankrupt. And then came the savior of this small group of creative innovators: HP. It seemed a perfect pairing: a small creative group, and a deep pocketed company with the capital and the marketing power to give a brilliant new operating system the launch it had deserved in the first place. Until last week, with no warning to it's own employees, it declared an end to all WebOS devices and declared a fire sale on all these devices, effectively throwing away around 3 billion dollars used to acquire Palm and further develop WebOS. And the company did this after just over two months on the market. And then a magical thing happened, EVERYONE wanted one of these devices. Through sheer ineptitude and mismanagement, HP struck on the strategy that ALL pretenders to the Ipad throne should have been pursuing from the beginning: when there is a clear leader in a field with few if any weaknesses, you MUST best them dramatically in price to build a user base, create brand loyalty, and expose the market to what makes your product worthy. No matter how cool your ad campaign is (and, for the record, HP did a horrible job.....Russell Brand and Lea Michelle? Really? They managed to choose two celebrities that I would actually pay to not have in my home or on my tablet.) People can't get passionate about your product until they own it. Once they own it, they can become zealots, and then missionaries, and then the market share of that company grows, and then it becomes......Apple. What happened this weekend is that HP has sold 350,000 Touchpads this weekend after flipping it's few loyal fans the bird and quietly slipping it's passionate development team pink slips. That makes the Touchpad the second most popular Tablet computer in the world. A goal that RIM Blackberry, Motorola, Samsung and, indirectly, Google, have all thrown millions, if not billions of dollars at. If there is another example of a massive company Forrest Gumping it's way to a goal in this way, I am unaware of it. Imagine if a group of investors bought a race horse that continually failed to live up to expectations, so they decided to cut their losses and shoot it in the head. They miss, the horse bolts, and promptly sprints past all competitors winning the race. Now even assuming that a quarter of these sales are simply people trying to get rich reselling the Touchpads on Ebay, by the end of next week HP will have 500,000 Touchpads in the wild. WebOS developers have already reported dramatic increases in profits this weekend. Where there is profit to be made, developers will go. The very developers that HP tried so unsuccessfully to court in the first place. The servers of major online electronics retailers have collapsed under the demand, there have been lines around the corner at every brick and mortar electronics store in the country. In short, a result that every marketing team dreams of. So the question is....what will HP do? Knowing Corporate America they will not change their minds and embrace this bizarre reversal of fortune. But for the sake of innovation I truly hope they do. Even diehard Apple fans should see the need for an actual viable alternative to iOS. Without competition, Apple will grow stale and stop innovating...like Palm did before it's death. Grow up HP. Admit you were wrong, and thank your lucky stars you have been given the things every business hopes for: amazing developers (with more to come with profit in sight), a persistently loyal fan base, programmers who love the development environment, and, most of all, a half million customers waiting to become zealots. You have all of these things, and you don't deserve one of them.
    It doesn't take a genius to understand that a iPad 2 grade tablet would fly off the shelves @ $99. It's $100!

    But nobody is going to drop nearly half a billion dollars just to get 1-2 million tablets in the hands of budget hunters. To take a noticeable market share from the iPad would take at least 15 or so million users (that'd have to put it over a billion lost). That's an insane amount of money to lose. The iPad would still be going strong either way; but then what are you supposed to do? Keep it always at a super losing price? Or raise it to $500, ****ing off the expectation?

    There are tons of low cost tablets, you've never noticed them because they suck. This was a one off fire sale. Tons of businesses fo this once they fail, you never see them rise from the ashes because of it.
  5. #5  
    I saw the topic and opened the thread and expected . . . "How corporate American can learn from HP's mistakes . . Don't hire Leo as your CEO"
  6. #6  
    ZOMGWTFPWNBBQ wall of text of doom!!!!11
  7. Fishous's Avatar
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    #7  
    Didn't read it myself, I can't really put much credit to anyone who doesn't know what a paragraph is.
    Mike Dixon
    Software Developer
  8. #8  
    My first thought was "HP doesn't know how to make an announcement that doesn't put the fear of god in users, developers, shareholders, the stock market at large, potential partners and the international mass media alike - but at least they used paragraphs in that announcement."

    Make of that what you will.
  9.    #9  
    Okay...didn't expect the grammar police to descend. I was actually hoping for some nice discussions to arise. I HAD put in paragraphs but somehow they were lost after submission. I hope that people will actually read and respond now rather than being snitty.

    I think that HP went too far with the pricing, but I DO think that this is the only way a company will get a market share in the tablet race. They need to follow what Microsoft did to get into the console game. If Touchpad had come on the market at $200 and $250 (which might make HP break even on parts and labor) I think there would have been a HUGE adoption rate. But every company is coming on the market with less refined machines at a similar price to Apple.

    The Xoom and Playbook are both great machines....but no one cares....too expensive. Meanwhile TONS of people with a bit of technical know how are picking up Nooks at around $200 and throwing Honeycomb on there. My point is simply that if HP had approached this as a marketing strategy to get people excited about THEIR digital ecosystem and then inched up the prices with each generation, It could have been very successful. People thought Microsoft was insane when they started pushing the Xbox while taking a financial loss on every unit.....look where they stand compared to Playstation now.

    But the real question for the company SHOULD be: What now? This HAS worked on a certain level. Obviously they can't take a 150 dollar per unit hit. But what if they came up with a plus model that covered costs and incrementally increased with each generation? I think there would be enough converts and WebOS geeks to start the ball rolling......
    Last edited by Macros746; 08/22/2011 at 09:31 PM. Reason: again...paragraphs
  10. methods's Avatar
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    #10  
    Imagine if a group of investors bought a race horse that continually failed to live up to expectations, so they decided to cut their losses and shoot it in the head. They miss, the horse bolts, and promptly sprints past all competitors winning the race.
    This was my favorite part...great analogy
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  11. samab's Avatar
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    #11  
    Quote Originally Posted by Macros746 View Post
    People thought Microsoft was insane when they started pushing the Xbox while taking a financial loss on every unit.....look where they stand compared to Playstation now.
    And the whole point is that Steve Ballmer basically CANNOT be fired --- no matter what --- as long as he has the confidence of Bill Gates. If Steve Ballmer wants to lose $5-6 billions on XBox, and Bill Gates okey on it --- there is nothing Wall Street can do about it.

    Same thing for Google --- the 2 founders have 59% voting power of the company. If Google decides to lose $5-6 billions on Android, there is nothing Wall Street can do about it.

    Japan is where capital goes to die --- that's why Warren Buffett never invests in Japan. Japanese companies spend massive amount of money on fruitless stuff --- and their shareholders don't ever complain about it. Rome is burning and Sony put out a robotic dog.

    HP will never have that kind of shareholder support to lose billions of dollars on mobile platforms.
  12. #12  
    stop hiring crappy CEOs like Carly Fiorina and Mark Hurd.
    Stop buying unprofitable or problematic companies like Palm and Compaq
    Make your consumer products better, sexier, more reliable and on a faster timetable.
    You come at the king. You best not miss.
  13. #13  
    Quote Originally Posted by transient View Post
    There are tons of low cost tablets, you've never noticed them because they suck. This was a one off fire sale. Tons of businesses fo this once they fail, you never see them rise from the ashes because of it.
    Your post had a lot of great points, but I wonder about this last bit. Most businesses don't sell mobile devices that require developer interest to survive. To my knowledge, we've never seen a firesale of devices like this before.

    Isn't it possible that this sudden surge in marketshare could help maintain interest in webOS until it can be sold to a more capable company?
  14. #14  
    (In reference to the horse analogy)

    Quote Originally Posted by methods View Post
    This was my favorite part...great analogy
    Agreed. Very succinct and accurate.
  15.    #15  
    Quote Originally Posted by VCI_Cell View Post
    Your post had a lot of great points, but I wonder about this last bit. Most businesses don't sell mobile devices that require developer interest to survive. To my knowledge, we've never seen a firesale of devices like this before.

    Isn't it possible that this sudden surge in marketshare could help maintain interest in webOS until it can be sold to a more capable company?
    That's sort of my point. They completely stumbled onto this strategy blindly and stupidly but, to an extent, it worked. I think we die hard WebOS folk always knew that if enough people got to experience WebOS, that it would develop a small but strong following. I think if they are wise, they will use this bizarre firesale to drum up some interest. And I'm glad you liked the horse analogy. It came to me in the midst of an exhausted haze at various airports all over the country in the travel day from hell (while trying to actually order one of these darn things )
    VCI_Cell likes this.
  16. #16  
    Now that a punter can read your post without getting eye cancer, you're making some really good points.
    The horse analogy has got to be the best I've ever heard in relation to webOS.

    Now all we can do is hope that they actually missed the horse and didn't accidentally hit it after all - it's possible that they did hit the horse, and it was a fatal shot, but the horse just bolted with the last bit of power it had because the gunshot wound hurt so much.
    Because if that's what happened, the horse may well be doomed to die shortly. Remember, it's not about winning the race, it's about winning the championship (or at least getting on the podium), and that won't be possible if the horse dies of the wounds before the next stage of the championship.

    I really hope those legendary vets, Dr. H.T. Cee and Prof. Sam Sung, can fix the horse up for the next race.

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