The stock market hates HP's new strategy • Hacker News Board

Re: The stock market hates HP's new strategy

#41

Post by metageek » Fri, Aug 19, 2011, 6:00 PM UTC

arthurschreiber wrote: post #20

camiller wrote: post #13

Earlier quoted context omitted.

Realize that a different CEO was in charge at HP when the acquisition of Palm occurred and the new CEO came from an enterprise software company (SAP) and seems intent on turning HP into a company he knows how to run, rather than running HP as the company it is. Someone (maybe at precentral.com) likened it to when a sports team gets a new coach he recruits players for his style of game instead of building with the tal…

The thing is, the Touchpad already had a dual core cpu built in. I can't really imagine that HP has put the effort of completely porting webos over to a different hardware platform, but I think that instead they might have tested the enyo toolkit on the iPad and have seen tremendous performance improvements. Those, I think, can be attributed to the superiority of MobileSafari (having hardware acceleration and having…

>The thing is, the Touchpad already had a dual core cpu built in.

Except it's an A8 instead of an A9.

Re: The stock market hates HP's new strategy

#42

Post by guelo » Fri, Aug 19, 2011, 6:01 PM UTC

darksaga wrote: post #38

guelo wrote: post #24

Another MBA type killing a great tech company. I don't understand why it doesn't occur to these boards that engineers/technologists/innovators should lead tech companies. For some reason they can't imagine that technology can save a technology company. It wasn't some genius business maneuver that turned Apple into the biggest company in the world, it was genius technology.

The main reason they hire MBA types instead of engineers is because the main purpose of the company is to make money. A lot of MBA's don't take a long view on technology for various reasons. Thus, when every product you make isn't shipping a million pieces a month, these guys get worried and make stupid moves. In HP's case, they made a succession of stupid moves. Apple does have genius technology, but you can't under…

I meant to include Steve Jobs when I referred to engineers/technologists/innovators

Re: The stock market hates HP's new strategy

#43

Post by metageek » Fri, Aug 19, 2011, 6:01 PM UTC

Finnster wrote: post #25

What does a company like HP usually do when they have thousands of unsold tablets like this? Take them back and throw them in a landfill or will there ever be a clearance sale?

Bundle them with PCs, most likely. Landfill space is expensive.

Re: The stock market hates HP's new strategy

#44

Post by Daishiman » Fri, Aug 19, 2011, 6:04 PM UTC

justincormack wrote: post #23

ansy wrote: post #12

This was perhaps a good plan delivered with the poorest tact. The reality distortion field seems to be working in reverse for Leo & Co. Moving toward an enterprise only strategy could make HP healthier and more profitable in the long run. It may even reap additional benefits from a consolidation of vision. The PSG offers less and less synergy with the rest of the company with each passing year. Especially if WebOS is…

Personally I think that big enterprise software and its sales model, as perfected by Oracle and SAP is dead long term, it will be killed by an on demand cloud products. HP maybe had a chance to get into this market eventually, and WebOS was part of his strategy. But instead they decided to chase last decades model which makes high margins in the short term. And why does no one want to try to compete with Apple?

> Personally I think that big enterprise software and its sales model, as perfected by Oracle and SAP is dead long term, it will be killed by an on demand cloud products. HP maybe had a chance to get into this market eventually, and WebOS was part of his strategy

It's not going to be the market it once was, but those companies have very, very good reasons to use enterprise software: they can't rely on no-name cloud providers for legal and ass-covering reasons, they need the local installations and control of their infrastructure, and their sales structure is optimized for dealing with large corporations.

> And why does no one want to try to compete with Apple?

Doing your own hardware is expensive, and getting good margins much more so. HP hasn't made high-quality hardware in ages, and they can't possibly compete with Apple or Google's partners in the arena when they have to catch up and invest even more money than them.

Re: The stock market hates HP's new strategy

#45

Post by waterside81 » Fri, Aug 19, 2011, 6:10 PM UTC

metageek wrote: post #39

waterside81 wrote: post #26

Earlier quoted context omitted.

I have to give the HP board the benefit of the doubt that when they hired the new CEO they knew he'd steer them in this direction. He used to work at SaS so his expertise is software services. He must have told them in the recruitment/appointment process that he'd give some things a shot (webOS, TouchPad etc.) and failing that, he'd steer them towards services and become more like IBM. I made a lot of assumptions, bu…

>He used to work at SaS SAP.

Thanks for the correction. Freudian slip perhaps.

Re: The stock market hates HP's new strategy

#46

Post by Silhouette » Fri, Aug 19, 2011, 6:24 PM UTC

justincormack wrote: post #32

ansy wrote: post #27

Earlier quoted context omitted.

What? The cloud IS Oracle, IBM, SAP, and HP's future revenue model. They are going to build the cloud, build the enterprise cloud services, and bill out consultants specializing in the cloud. HP's future is nothing but the cloud moving forward. HP makes the servers that are the cloud. HP's business software will sit on its servers instead of yours. HP's consultants will charge you $$$ to tell you which services work…

That is what they think. MySpace bought HP servers, but Facebook doesnt. That market will commoditise too, as cloud that uses software not hardware redundancy doesnt need the high margin features. And the future of business software is gradually being built by Salesforce, Google, Dropbox and so on. The landscape will change drastically. While there is innovation in clients, owning a platform is still part of a viable…

Respectfully, I don't think you appreciate the scale of huge companies and the requirements for the software and suppliers that help to manage them.

If HP or IBM or SAP or Oracle wanted to do what, say, Dropbox does, they would throw effectively unlimited funding at the problem until it was solved. They might not even bother to market the result publicly, to avoid diluting their brand, but if they chose to do so, then the unfortunate small company concerned would probably be gone in a few months (assuming the large company didn't just litigate it out of existence because it was easier, if you're in a jurisdiction like the US).

Put another way, companies like Dropbox don't do well because they have a magic recipe that the big boys don't, they do well because they've chosen a niche where they're too small for the big boys to care about and where there are plenty of smaller businesses who will value and pay for that kind of offering because they don't have the same kind of resources in-house to do it themselves.

Edit... I should also mention Google, who aren't likely to be competing in the "enterprise" arena any time soon for a very different reason: they aren't set up to support that scale of customer. If you want to sell software to an engineering giant or a global services firm with an employee count in six figures, you don't show up with a few web pages and an e-mail address, you send a CxO or two on a plane to their head office to schmooze them, and then you appoint an SVP whose only role is to lead a large team of sales and support staff dedicated to jumping when that customer says jump.

Re: The stock market hates HP's new strategy

#47

Post by unohoo » Fri, Aug 19, 2011, 6:27 PM UTC

I wonder if Nokia had approached / will approach HP to acquire WebOS. With Elop @ Nokia's realm, I am skeptical. RIM is too busy building its on OS to be really interested. Amazon, Intel and Samsung seem like very likely candidates to take WebOS off HP's hands.

Re: The stock market hates HP's new strategy

#48

Post by forgotAgain » Fri, Aug 19, 2011, 6:28 PM UTC

justincormack wrote: post #23

ansy wrote: post #12

This was perhaps a good plan delivered with the poorest tact. The reality distortion field seems to be working in reverse for Leo & Co. Moving toward an enterprise only strategy could make HP healthier and more profitable in the long run. It may even reap additional benefits from a consolidation of vision. The PSG offers less and less synergy with the rest of the company with each passing year. Especially if WebOS is…

Personally I think that big enterprise software and its sales model, as perfected by Oracle and SAP is dead long term, it will be killed by an on demand cloud products. HP maybe had a chance to get into this market eventually, and WebOS was part of his strategy. But instead they decided to chase last decades model which makes high margins in the short term. And why does no one want to try to compete with Apple?

Given the requirements of the US Patriot act, (cloud providers must turn over customer data to the government without disclosing it to the customer and without the benefit of a warrant), I don't see large corporations moving to public clouds. Private clouds maybe but not public ones.

Re: The stock market hates HP's new strategy

#49

Post by ansy » Fri, Aug 19, 2011, 6:31 PM UTC

justincormack wrote: post #32

ansy wrote: post #27

Earlier quoted context omitted.

What? The cloud IS Oracle, IBM, SAP, and HP's future revenue model. They are going to build the cloud, build the enterprise cloud services, and bill out consultants specializing in the cloud. HP's future is nothing but the cloud moving forward. HP makes the servers that are the cloud. HP's business software will sit on its servers instead of yours. HP's consultants will charge you $$$ to tell you which services work…

That is what they think. MySpace bought HP servers, but Facebook doesnt. That market will commoditise too, as cloud that uses software not hardware redundancy doesnt need the high margin features. And the future of business software is gradually being built by Salesforce, Google, Dropbox and so on. The landscape will change drastically. While there is innovation in clients, owning a platform is still part of a viable…

Enterprise software is a hell of a lot more than racks of web servers and managing licenses for Microsoft Office. Any publicly traded company, even one that is not a software company, has tons of business processes that are specific to its way of doing business and its industry. That requires various specialized if not custom software and lots and lots of glue to put it all together. On top of that, businesses want to see into all that activity so all the data from that software needs to be extracted, collected, combined, and reported on properly which requires technical and business expertise specific to that company's business practices and technology choices. The addition of more cloud services increases this burden while decreasing other burdens.

HP makes lots of money through EDS selling consulting services and outsourcing services to do all that stuff. Stuff that is being fed by the move to more and more cloud services whether internal or external.

And when I say enterprise services, I mean software as a service stuff like Salesforce. There are more services that business need than Salesforce such as data warehousing that HP is in a strong position to enter or dominate. That said, even though something like Salesforce is a turn key solution hosted off site, it doesn't mean there isn't an enterprise sales process. A middle manager doesn't buy up 1,000 seats of Salesforce subscriptions at $65 per month without going through the normal enterprise approval process. I've seen it and it can take several months even though your average small business owner can sign up in 10 minutes with a corporate credit card. The real deal involves contract scrutiny and due diligence work. And just because Salesforce is easier, it doesn't mean you don't need a ton of development and integration work to bring it in line with your existing practices and software tools which usually requires outside experts at least for training if not complete outsourcing.

Re: The stock market hates HP's new strategy

#50

Post by dstein » Fri, Aug 19, 2011, 6:37 PM UTC

It's surreal when I think back to between 2001 and 2005 I honestly thought the iPaq running Windows Mobile was going to be the future of computing. Microsoft and HP looked poised to dominate forever.

... and then nothing happened. Both HP and Microsoft turned out to have ZERO vision, and just decided to stop innovating, kicked back, and collect their big fat dividend checks. And now Apple is eating their lunch with two fists.