View From Above

Feb 20 2013   5:06AM GMT

Poor Pathetic HP Way Too Late to Android Tablet Market

Ron Miller Ron Miller Profile: Ron Miller

More than 18 months after its first failed attempt at a tablet, HP is poised to try again. This time with Android in a crowded marketplace. Don’t expect different results.

HP has decided to take another hack at tablets, this time using Android as the operating system. I don’t expect the results to be much different from last time.

For those of you who don’t remember — and HP’s foray into tablets was so brief you would be forgiven if you’ve forgotten — HP bought Palm in April, 2010 for $1.2 billion. The idea at the time was take webOS, Palm’s mobile operating environment and build an HP line of tablets and mobile phones.

It seemed like a surprisingly sound strategy. A year after purchasing Palm, HP came out with the TouchPad tablet running WebOS. There were mobile phones in the pipeline. Everything looked rosy, then a mere 45 days after releasing the first TouchPads, HP pulled the plug on the entire strategy and held a fire sale.

Since that fateful decision to axe its mobile strategy, the company has been in downward spiral. There were plans to spin off the printer and PC divisions that also fell through. There have multiple CEOs. The latest Meg Whitman has overseen a massive layoff and the company appears to be in decline.

Yet HP remains the largest PC maker in the world — for now. The problem being that PC sales are declining as tablets begin their ascension as primary computing devices. As I wrote last week in Tablets are Taking a Bite Out of the PC Market, “Last quarter Apple sold 23 million iPads, while HP — the world’s largest PC maker — sold 15m PCs.”

Even myopic HP can see that having a tablet is essential to any company’s hardware strategy these days. So more than 18 months since it gave up the last one, rumors have surfaced that HP is planning on building and marketing a high-end Android tablet. Talk about being a way too late.

First of all it’s unclear anyone would want a high-end Android tablet. Apple is already firmly entrenched at the high end of the tablet market. Microsoft is trying to offer an alternative hybrid device for even more money than the most expensive iPad. I don’t see how HP can fit into this market and find any space to operate.

It’s even more crowded at the lower end of the market where Amazon is offering the Kindle Fire HD for as low as $199. Google is offering the Nexus 7 for $199 and the Nexus 10 for as low as $399. There are countless other competitors including Lenovo and Asus offering a range of alternatives.

The problem for HP is that market is far more difficult to maneuver in than it was in 2011 and the Android market is crowded with competitors who have been doing it much longer.

Whether HP comes out with a tablet or ignores the tablet market altogether doesn’t really matter because the market has moved on, and HP like so many other decisions in recent years has waited too long and is way late to the game.

6  Comments on this Post

 
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  • Michael Tidmarsh
    So with the PC market struggling and since it's too late to join the tablet market, what should HP's next step be?
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  • Ron Miller
    Good question, Michael. I think they should get out of the computer business and concentrate on a few enterprise areas such as storage and the cloud. 
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  • Gbollard
    I'd be critical of this if it was about HP coming up with another new tablet system but it's not.  They're simply entering the market and using an existing (compatible) and established system.  Having quality choices like HP and Samsung in the android market is no different to having Lenovo, HP and Dell offering quality PC products in a market full of low-priced clones.

    Businesses will pay more for the reputation and warranty that comes with a brand name device.  As for the cloud, that's a much more crowded market than the tablet one.  HP would do well to stay clear of that.
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  • infomanager
    @gbollard - I beg to differ in regard to your assertion that buying a brand provides a customer with warranty backed by the brands reputation. Case in point; Lenovo let many of its clients down when they pulled support for their ThinkPad (android) device. Initially peddled as a business tool, on spec it certainly looked a formidable contender for the wallet of enterprise users. Not only did Lenovo pull the device from the market, but they destroyed their thinkpad "app" store. Further adding insult to injury, many of the apps available solely through this app store have been orphaned off by their developers, with no recourse to updates even where the same app is available from the Google app store!!
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  • TomLiotta
    I can't quite characterize Lenovo's problems with the app store that they used as having "destroyed" it. It looks as if that issue was outside of Lenovo's control. Regardless, it does point to an issue with relying on a facility (e.g., an "app store") that is not completely within your control. If the facility closes, you are left hanging, and it's a bad experience for your customers. BTW, Lenovo still has Android devices showing as available on their web site; so it doesn't seem as if they've dropped support except possibly for earlier models. Any links to show dropped support? -- Tom
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  • Ron Miller
    Gbollard,Your assertion assumes that people take HP seriously as a brand, and I don't think that's necessarily true anymore and that IT is still purchasing the devices, when in many cases, users are choosing their own devices now in a Bring Your Own Device kind of scenario. I can't see many people buying HP tablets when given the choice of Apple or the myriad of other quality Android offering out there. 
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