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The stock market hates HP's new strategy

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Re: The stock market hates HP's new strategy

#31

Post by kitsune_ »

aresant wrote: post #10

Barron's nails it: a) "decision to cease all webOS devices (including the TouchPad) a mere 48 days after the launch" - Leadership doesn't know what they're doing w/acquisitions. b) "expensive acquisition of Autonomy" - $10b to jump into a new market via acquisition which we just proved we're not good at. c) "material layoffs" and "talent drain over the next 12-24 months' - I believe this. Current talent bails. Changi…

Does anyone have any experience with Autonomy and its IDOL technology? I visited their site and they look a little bit shady :)

Re: The stock market hates HP's new strategy

#32

Post by justincormack »

ansy wrote: post #27
justincormack wrote: post #23

Earlier quoted context omitted.

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?

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 strategy. There is still an opening for a business friendly platform, as Microsoft can still lose and RIM is weak.

Re: The stock market hates HP's new strategy

#33

Post by justincormack »

dman wrote: post #28
justincormack wrote: post #23

Earlier quoted context omitted.

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?

Its hard to compete against a religion.

Pepsi competes against Coke. Islam competes against Christianity.

It requires a long term view that businesses are no longer good at in general.

Re: The stock market hates HP's new strategy

#35

Post by notatoad »

camiller wrote: post #13
rkalla wrote: post #9

I think a lot of it has to do with how the decision was... presented? 1. HP tablet sales fail. 2. HP warns of low earnings, then announces them. 3. Promise to make announcement only after market closes on the 18th. 4. Rumors that they are spinning Compaq back out. 5. Changes mind and makes announcement. 6. They are buying Autonomy (enterprise/IBM space) 7. They are shooting the mobile device effort in the face. That…

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…

>seems intent on turning HP into a company he knows how to run, rather than running HP as the company it is.

but what is HP currently? all their consumer-level products are shit. i don't have any experience with their current enterprise services, but from the way apotheker is talking i'd assume they have a decent infrastructure in place there to build upon. their last few CEOs have kind of run their consumer hardware manufacturing division into the ground, maybe pulling out is the best thing to do at this point.

Re: The stock market hates HP's new strategy

#36

Post by Bo102010 »

I don't think the HP leaders will regret the change of focus to businesses instead of consumers. Every day we hear that businesses are sitting on increasingly huge piles of cash and that individuals are increasingly jobless.

Then again, I'm not scooping up bargain HP shares, so my idle speculation isn't extremely compelling even to me.

Re: The stock market hates HP's new strategy

#38

Post by darksaga »

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 underestimate the influence of Steve Job's eye for design in the success of Apple products.

Re: The stock market hates HP's new strategy

#39

Post by metageek »

waterside81 wrote: post #26
aresant wrote: post #10

Barron's nails it: a) "decision to cease all webOS devices (including the TouchPad) a mere 48 days after the launch" - Leadership doesn't know what they're doing w/acquisitions. b) "expensive acquisition of Autonomy" - $10b to jump into a new market via acquisition which we just proved we're not good at. c) "material layoffs" and "talent drain over the next 12-24 months' - I believe this. Current talent bails. Changi…

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.

Re: The stock market hates HP's new strategy

#40

Post by wheels »

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…

> the future of business software is gradually being built by Salesforce, Google, Dropbox

What color is the sky on your planet?

Enterprise software -- the largest software market by a long-shot -- is not scared of ... Dropbox. That's like saying that cars will be wiped out by lawnmowers. The statement doesn't make any sense. Nor does using Facebook and MySpace as examples of enterprise infrastructures. They're medium sized companies with disproportionately large infrastructure needs. What happens at Facebook says virtually nothing about what happens at Mercedes. And nobody in the enterprise trusts Google since enterprise software is all about managing worst case scenarios, and Google's "here, talk to a robot" isn't even in the same galaxy as an acceptable partner program for the enterprise.

Salesforce is the only one of those companies that even should be mentioned in the same breath and they're mostly a pain in the ass for Oracle and SAP because they've been chipping away at the low end of the market (very successfully). It is plausible that they'll continue to push upward and conquer increasingly larger markets, but that's something that will take a decade or two to unfold.

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