02/10/2011, 10:05 AM
From all the comments, it seems that very few people understand (or care about) the business strategy behind what HP just did. As a business owner myself, I think it is genius. It’s a bold move indeed, and I can't wait to see how it all plays out!
HP did not announce hardware yesterday. That was just eye candy…a diversion if you will. The ‘wow’ announcement was at the end. HP went ‘all in’ on a bold move to literally change the face of computing for years to come. Sound like a familiar storyline? (hint: Apple)
Ok HP, you now have my attention.
Here’s why I’m going to make an investment in HP:
- HP has been around, and has been very successful for years. They are not stupid.
- As the world changes, companies need to change if they want to avoid going out of business (ie, IBM used to be a meat slicing company, then computers, now ‘business solutions’).
- The phone market is a very tiny part of the overall HP portfolio (almost a joke). They are not concerned with phone sales dropping. They’ll let it happen, big deal.
- HP bought Palm for the OS, not the phones. Most people love the Pre and the idea because of the OS, not necessarily the phone itself (as seen by 80% of the posts here).
- HP knows that unless they artificially throw money at the phone market, they won’t be able to have a phone that actually “wows” the consumer. They’d look silly trying to keep up with the neighbors next door. Why waste money and be runner-up for years to come?
- HP makes modest moves to keep themselves in the game (incremental upgrades and platforms to develop their OS), and keeps the consumer mildly interested. They’re not worried about losing a few fans, or making a few people upset...for now. They are making their move.
- They decide to proliferate WebOS on millions of computers worldwide over the next 2-5 years.
- So, what happens 2-5 years from now, when WebOS is on PCs that ship twice a second? This is why they spent all the time up front, laying the foundation.
- Mass proliferation means more interest, more interest brings more developers, more developers means more applications, more applications means more demand, more demand means more of everything...yada yada yada
Business strategy 101.
This is clearly a move that sets HP apart from every other “just trying to keep up” technology company out there.
Why compete and continue to lose, when you can beat them at a different game? We don’t have to like what it means for us short term as fans, but that’s just simply our microwave mentality and lack of business saavy (in most cases).
Heck, we don’t even have to stick with the short term Pre/Veer/TouchPad devices for them to be successful in their strategy. Enough people will, and that's all they need. I've had my Pre since launch. I'm still unsure what my move will be when I upgrade, but I'm quite certain that I'll be with HP 2-5 years from now.
People used to mock Apple and laugh about their products back in the day. Was anyone developing for their OS back before they made their moves? Heck, they even fired Steve Jobs.
Very few companies can afford to make the move HP just did. They lose some fans and some sales for now (in a small market for them), but when they get the OS migrated onto PCs, and it changes the face of computing, only then will you start to see things change… The effects will be seen 2-5 years down the line.
Good move HP. Smart business.