In A Nod To IBM, HP Minimizes Consumer Review
San Francisco (AP) - Hewlett-Packard has decided to indulge in smart phones and tablet PCs and, eventually, to get rid of its personal computer business shows that Apple has changed the consumer electronics in four years.
New HP CEO Leo Apotheker is trying to make the pillars of Silicon Valley in a twin on the east coast rival IBM Corp. In this way, grateful that his company has failed to balance the demands of both consumer markets and business . Therefore, you have to leave most of its consumer businesses, like IBM six years ago
New HP CEO Leo Apotheker is trying to make the pillars of Silicon Valley in a twin on the east coast rival IBM Corp. In this way, grateful that his company has failed to balance the demands of both consumer markets and business . Therefore, you have to leave most of its consumer businesses, like IBM six years ago
Apple is the company's most popular consumer electronics on the planet. The 2007 debut of the iPhone in usability and intuitive design unmatched by his predecessors, including the pioneer Palm smartphones, which HP acquired last year in hopes of gaining a new foothold on mobile devices. Apple followed with the team in 2010 and achieved iPad persuade people to buy a product they did not know they needed.
Rather than being locked into a losing battle with a company that seems to have found the magic touch to hit supplies, HP cut its competition with other areas of business technology experts - namely, IBM , Oracle and Cisco Systems Inc.
"Apple has beaten one outside of the HP business PCs, smartphones and tablets," said Gleacher & Co. analyst Brian Marshall in an interview.
HP overhaul, announced Thursday, is composed of three parts:
- HP will stop making tablet PCs and smartphones in October.
- He will try to separate or sell its PC business, the largest in the world. At the end of next year, HP computers sold under another company name.
Rather than being locked into a losing battle with a company that seems to have found the magic touch to hit supplies, HP cut its competition with other areas of business technology experts - namely, IBM , Oracle and Cisco Systems Inc.
"Apple has beaten one outside of the HP business PCs, smartphones and tablets," said Gleacher & Co. analyst Brian Marshall in an interview.
HP overhaul, announced Thursday, is composed of three parts:
- HP will stop making tablet PCs and smartphones in October.
- He will try to separate or sell its PC business, the largest in the world. At the end of next year, HP computers sold under another company name.
- The company plans to buy software maker Autonomy Business Corp. for about $ 10 billion in one of the largest purchases of HP's history of 72 years. It would expand the HP software and services offerings, IBM is strong.
HP, the largest technology company in the world by revenue, will continue to sell servers and other equipment to companies such as IBM does today. These companies do not currently generate revenue from HP and PC, but they have higher profit margins.
Apotheker did not say whether jobs are cut. HP intends to take about $ 1 billion in restructuring costs and related products, some of which may go to redundancy payments. HP employs more than 300,000 people around the world.
Moving from HP to IBM's business model of style, which focuses on selling to businesses and governments, it makes sense since Leo Apotheker has spent most of his career in the German business software maker SAP AG, another company to respond to the technological needs of companies and government agencies.
"This is his bread and butter," says Marshall. "Now he has given."
Investors seemed disappointed and sent HP reserves by 6 percent on Thursday on a day the broader market fell, with the Standard & Poor's 500 fell 4.5 percent. In morning trading Friday, HP has lost another 20 percent, or $ 5.81 to $ 23.70.
HP, the largest technology company in the world by revenue, will continue to sell servers and other equipment to companies such as IBM does today. These companies do not currently generate revenue from HP and PC, but they have higher profit margins.
Apotheker did not say whether jobs are cut. HP intends to take about $ 1 billion in restructuring costs and related products, some of which may go to redundancy payments. HP employs more than 300,000 people around the world.
Moving from HP to IBM's business model of style, which focuses on selling to businesses and governments, it makes sense since Leo Apotheker has spent most of his career in the German business software maker SAP AG, another company to respond to the technological needs of companies and government agencies.
"This is his bread and butter," says Marshall. "Now he has given."
Investors seemed disappointed and sent HP reserves by 6 percent on Thursday on a day the broader market fell, with the Standard & Poor's 500 fell 4.5 percent. In morning trading Friday, HP has lost another 20 percent, or $ 5.81 to $ 23.70.
Apotheker to demand radical changes to help erase the stain of scandal and leave its mark on a huge company he inherited last year. His predecessor, Mark Hurd, resigned under pressure a year ago, after an investigation revealed the documents were falsified to conceal a relationship with a contractor to HP marketing.
In an attempt to remove the majority of companies use HP's Apotheker reverse a decade of binge hardware.
The area where HP was the most visible defects are mobile.
HP is hopelessly outmatched smart phones and tablets, despite the $ 1.8 billion acquisition last year, Palm Inc., whose software webOS was the spearhead of a lot. Software powered touchpad compressed novice, HP-powered smartphone, which closed the statement on Thursday.
The software has been well reviewed, but the iPhone and iPads and smartphones running Google Inc. 's Android operating system - as possible after the way Apple - has been dominated by the most rapid growth in the technology market home. HP has remained on the sidelines. WebOS smartphones held a global market share is less than 1 percent according to Gartner.
In an attempt to remove the majority of companies use HP's Apotheker reverse a decade of binge hardware.
The area where HP was the most visible defects are mobile.
HP is hopelessly outmatched smart phones and tablets, despite the $ 1.8 billion acquisition last year, Palm Inc., whose software webOS was the spearhead of a lot. Software powered touchpad compressed novice, HP-powered smartphone, which closed the statement on Thursday.
The software has been well reviewed, but the iPhone and iPads and smartphones running Google Inc. 's Android operating system - as possible after the way Apple - has been dominated by the most rapid growth in the technology market home. HP has remained on the sidelines. WebOS smartphones held a global market share is less than 1 percent according to Gartner.
HP will try to find ways to keep alive webOS, which could include the use of other devices such as computers and printers or licenses to manufacturers of mobile phones, Apotheker said in an interview. He said he was disappointed by the designs of HP mobile devices and believes that the company would have required a lot of money to go around.
"We have a better opportunity to invest their own resources," he said.
HP executives probably decided that "they were too late to market tablets make a dent," said Forrester Research analyst Charles Golvin. "They recognized they did not have a high probability of success."
HP may groped of webOS licenses for cars and consumer electronics devices made by other companies, Golvin said. But it is also challenging, because Google is looking for the same market, many of the Android system, which is free.
"This raises the question of how long it takes before the other shoe drops and close the palm of the business completely," said Golvin.
Decline in business for many Palm amazing techniques.
Jon Rubinstein, former CEO of Palm, Palm said in December it sold, because account managers can be small and efficient, but can not sustain itself in the long run.
Rubinstein, who was an officer of Apple before heading to the Palm, said HP seemed to be the best choice because of its size, it can help bring its products to more people Palm.
In PCs, HP is acknowledging the need to change course in the way started two CEO, Carly Fiorina, as. He pushed through the controversial decision to spend $ 19 billion for Compaq Computer. This opened the way for the emergence of HP to become the world's leading manufacturer of PC above.
PCs are the major source of revenue for the HP, but HP also has the company less profitable, due to falling computer prices and the competition brutal.
HP's efforts to dump its PC business is another concession to the growing dominance of Apple's consumer electronics, said Shaw Wu, an analyst at Sterne Agee. The PC division has become a liability for the actions of HP, but still represents about 15 percent of company revenues, said Wu.
"Apple is a formidable competitor, HP probably realized he was forced to cut its losses," Wu said. "And it makes sense to cut your losses sooner rather than later."
The decision also makes the path similar to HP rival IBM. A key player in the construction of the PC market in 1980, IBM sold its PC business in 2005 to focus on software and services that do not pay as much work and building components for the computer hardware.
The acquisition of autonomy reflects a key element of the transformation of IBM mainframe vendor software indigestible and service center, which has made IBM the envy of many large technology companies.
HP fiscal year net income rose in the third quarter ended July 31, but its lower than expected for the current season stock is weighed. The company, based in Palo Alto, Calif., also cut its forecast for full-year sales.
AP Technology Writers Michael Liedtke and Rachel Metz in San Francisco and Barbara Ortutay in New York contributed to this report.
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