Channel Marker

Aug 30 2011   6:12PM GMT

HP PCs are dead, long live HP PCs!

badarrow Barbara Darrow Profile: badarrow

Talk about mixed messages.

First Hewlett-Packard CEO Leo Apotheker says the company might spin off or sell off its huge PC business and kill off its new TouchPads. Then a cadre of other HP execs hit the phones to tell partners–the partners that HP has pushed to sell more, more, more PCs and laptops– that PCs remain a priority at HP.

Now HP tells Reuters that a spin off–not a sell off–of the HP Personal Systems Group (PSG)  would be the best option. And  HP big wig Todd Bradley swears that whatever happens, the HP PC business will remain Number One. He reiterated that a spin off is the best option and smart money is that no one other than todd Bradley would run said spin off. 

Here’s the thing: We all get that HP has a fiduciary responsibility to disclose its options in this unforgiving environment–but HP also has to know that signaling a possible sale or spin off of the PC business signals that that business, that $40 BILLION-a-year  business, is no longer seen as strategic to HP.

And that gets the attention of HP business customers and HP VARs alike. These were the people who heard Mark Hurd say that the PC business gave HP such huge economies of scale that it got the best prices and most advanced components on the market.

At this point it almost doesn’t matter what HP ends up doing: Bill Kleyman, virtualization architect for MTM Technologies, said this maneuvering has IT folks going back to the drawing board.

 That’s because for many companies, the PC decision and the server decision are made in tandem. “Big HP shops have practices built around HP desktops,” Kleyman said. “These are not mom-and-pop accounts but massive shops with 5,000 to 7,000 users who built a practice around desktop solutions. Now what do they do?”

IBM’s sell-off of its popular ThinkPad business a few years ago to Lenovo is the prototype everyone points to . But that was handled much more smoothly than this,.HP’s handling of this bore all the earmarks of a circus clown car.  

The upshot was that the HP news–which leaked ahead of Apotheker’s announcment–thereby forcing his hand, was handled poorly. And because of that, these HP business accounts are having lots of meetings, Kleyman said.  He wagers that whoever’s in charge is saying: “We have 12 to 18 months to come up with a new strategy, new budgets and a new plan.”

What does that mean for the market? “There are lots of champagne corks popping at Lenovo and Dell.”

The downside of the IBM-Lenovo deal, according to Kleyman, was that customer service took a hit. “It may have been a good move [for IBM and Lenovo] but when I was a CIO, we were strictly an IBM ThinkPad shop. And when they went to Lenovo, we saw service, support calls, get much worse. Response times were worse. As an IT director you can’t have that. We moved completely away from Lenovo to HP.”

Let us know what you think about this post; email Barbara Darrow, Senior News Director at bdarrow@techtarget.com,

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