In an interview last week with CRN, an HP official was happy, serene and confident. When it came to the tablet market, he wasn’t threatened by Microsoft’s Surface tablets. Nope, in fact, he was fine with it, and he believes that HP can compete even with the mighty Apple when its tablet hits the market later this year. Dream on.
Delusion is great especially from a company that tried to enter the tablet market once before with the HP TouchPad and failed so spectacularly that it was on the market for a whole 45 days before the company pulled the plug and held a $99, Get-’Em-While-They-Last, fire sale. I think based on this, we’ve earned the right to be a tad skeptical about such pronouncements.
This is HP after all, the same company that’s gone through 3 CEOs in the last four years, the same company that has so many SKUs for each product type, even their own engineers can’t keep track, and yes, the same company that is in the process of laying off 27,000 of its employees.
In other words, this is a company in free fall that seems out of touch with the current market.
Now HP expects us to believe, it has some super-duper, ultra-cool, top-secret features that are going to somehow give it the traction in the tablet market where so many others including HP itself have failed. If HP were smart it would have carried through with Leo Apotheker’s plan to spin off the PC division altogether. Just a year ago, the Wall Street Journal reported that HP was planning to do just that, but when Apotheker was fired 6 weeks later, those plans went out the window.
Apotheker might not be a high-tech visionary, but he recognized that it was tough to make money in the PC business because the margins were so tight. It’s especially tough when you create hundreds of different products and people can’t figure out what you sell. Look at the simplicity of Apple’s MacBook Pro laptop line. There are six basic models. That’s it. You can customize each one, of course, but you don’t have to deal with dozens of different models of basically the same laptop.
Now we have false bravado from HP’s senior vice president of Americas sales for HP’s printing and personal systems division, who would have us believe that something really special is coming, but he’s not saying what. You know, what? I’m not even remotely curious because chances are whatever HP produces will barely make a ripple in the tablet market when it’s released.
HP lacks even a modicum of tablet market leverage, and even though it might sound cruel, until HP actually produces a tablet that interests people, even a little, nobody cares at this point about whatever HP happens to have up its sleeve. The proof will be in the deliverable. Until then, excuse me while I yawn and snicker a little.
But that’s some sales figures, eh? Number 2 in the US market without even trying. I’m sure new CEO Meg Whitman is very proud.
According to a CNet article, the total numbers for non-iPad sales weren’t that great. iPad sold more than 11 million units in the first three quarters this year. Everyone else sold a paltry 1.2 million and of those, HP was the big winner taking in 17 percent of the non-iPad market.
The figures released by NPD showed a lackluster market for anyone not named Apple, but the folks who did buy competitor devices (and I use that term loosely) reportedly said they never even considered an iPad, apparently opting for a cheaper alternative.
The company actually still selling tablets was Samsung which came in just a touch behind HP with 16 percent of the non-iPad market. Interestingly, it is Samsung that’s under legal attack in the EU and elsewhere, being accused by Apple of violating its tablet patents.
The good news for Samsung is that with HP out of the picture, it will take over its rightful place as the number two tablet maker in the world. The Motorloa Xoom and RIM Playbook, which came to market with some fanfare earlier this year, have barely registered. When all of these companies can barely even move a million units combined, that says a lot about Apple’s domination.
When HP comes in at number 2 by practically giving away their devices, it says even more. Would HP have sold these devices at the original price of $500? Probably not. They would likely have languished with the competitors.
So it seems the formula for success in the tablet market (if you’re not Apple) is to create your product, build a developer ecosystem, then abandon it shortly thereafter.
On second thought, there might be better strategies than this, but for this year, it really worked out great for HP and I’m sure they’re dancing in the halls at HP today — or maybe not.
By now, nearly everyone who follows technology news has to know that in August just several weeks after launching the webOS-based TouchPad, HP announced it was pulling the tablet from the market, selling them off at bargain basement rate of $99 and spinning off its PC division.
Further, it was buying Autonomy for $10 billion and changing its focus from a hardware company to one that sells much more lucrative software and services.
To say that people were shocked by this development was an understatement. The markets reacted particularly badly and it didn’t take long for the Board of Directors to fire CEO Leo Apotheker, the man who architected this vision.
A short time later, the company hired former eBay executive Meg Whitman to take over. At first, it looked like she would stay the course and continue Apotheker’s vision (which seemed odd given the Board fired him because of it), but then came the news last week that HP was keeping the PC division along with the new tablet strategy.
Meanwhile, to nobody’s surprise, I’m sure, webOS employees are fleeing HP as fast they can as it’s clear HP has completely abandoned this side of the business.
HP bought Palm in April 2010, precisely for webOS. Almost a year later, Apotheker announced his “webOS Everywhere” strategy. It was a bold vision and something that HP clearly needed, and it was a clear signal to Redmond that HP was no longer going to be beholden to Microsoft and the Windows OS.
HP had an OS of its very own and it was going to run with it — only problem was that it didn’t get very far.
Now we find HP running back into the arms of Steve Ballmer and company, apparently thinking that a tablet running Windows is better than the tablet it already had on the market for all of 6 weeks.
And don’t forget that prior to purchasing Palm, HP had a short-lived, high-priced tablet called the Slate that ran…wait for it…Windows.
If you’re completely confused at this point you should be because it’s a long, sordid and confusing tale that took a once mighty company on a full-on plunge.
I’m not sure what the latest tablet announcement means, or if the world is more likely to buy an HP tablet running Windows than one running webOS. It’s hard to say because HP never really gave the TouchPad a fighting chance to find out.
I believe HP looked more innovative and edgy when it went the all-webOS route, but perhaps going the safe route holding hands with Microsoft might be better in the long run and provide the company with some much-needed stability after this long, chaotic period.
Whatever the reasons, at this point, HP needs to find a plan and stick to it — once and for all.]]>
Lest we forget, earlier this year Nokia suddenly dropped Symbian and MeeGo and threw its weight behind Windows Phone 7.
Mobile development is a confusing landscape under the best of circumstances, but the last week in particular, just turned it on its head. I don’t want to be over dramatic about it because it’s not as though Apple abandoned iOS or Google abandoned Android, but it’s a pretty big deal that HP walked away from webOS.
It leaves me wondering how many business models were just throw into disarray by HP’s seemingly impetuous decision. While the HP TouchPad got mixed reviews, developers reportedly really liked webOS as a development platform, even if they were cautious — and it turned out with good reason — about throwing resources at it just yet.
Box. net, an online storage and collaboration company, recently announced support across all of the major platforms including HP TouchPad. They went so far as to run a promotion with HP offering a whopping 50 GB of free storage to TouchPad buyers, good for the life of the Box account (and don’t forget it’s good across many devices and platforms).
Box could not have been pleased when HP walked away from the tablets barely 7 weeks after the July 1st launch, but Box CEO Aaron Levie chose to see it in a positive light saying, “Ironically, the short-term impact has been positive: recent TouchPad sales have driven a major spike in Box signups – 30,000 Box for TouchPad app downloads to date…”
Some speculate that webOS will rise again, but it’s impossible to say what its future is right now, and I don’t see many developers supporting it at this point, even if somebody rescues it. But Box’s Levie says, he doesn’t see this having a huge impact on emerging platforms in general. Instead, he believes it may push the adoption of a more standardized approach like HTML5.
“I doubt HP’s decision will dissuade developers from building for emerging platforms in a major way. Rather, the focus will be on speeding up and standardizing cross-platform app development – for instance, leveraging HTML5 to more efficiently bring services to all devices, like we recently did with our HTML5 mobile web app,” Levie said.
Regardless, HP’s decision had to leave developers a bit shell shocked, wondering what would happen next. Maybe Levie’s right though and it will force the industry to look at a more standardized development approach where it doesn’t matter when vendors come and go like this.
HP certainly thinks that mobile is still in play. In a Fast Company article earlier this week, Phil McKinney, president and CTO of HP’s personal systems group had this to say about the mobile competition. “Everyone’s trying to make it seem the conclusion has been decided. We’re still in the top of the first inning.”
What would you expect him to say — that he’s giving up? Not likely. Like any good baseball manager, HP is going to keep pulling strings until the last pitch and see what happens — as they should.
Licensing WebOS could be a double-edged sword for HP though. When you look at the tablet and phone market, as of this moment, Apple and Google are clearly dominating. When it comes to the tablet, the iPad continues to blow away the field. HP gets it turn at bat on Friday when the HP Touchpad hits stores.
If the other competitors from Samsung to Motorola to RIM are any indication, HP’s prospects are not terribly bright. So far, when people buy a tablet, in overwhelming numbers they are choosing the iPad. Back in March, admittedly a life-time ago in tablet time, Apple Insider reported that 82 percent of potential tablet buyers said they would choose iPad. Those kind of numbers don’t bode well for HP, no matter what inning it is.
Licensing could end up fragmenting the tablet market even further. HP is not the first company to face this conundrum, but I’m willing to bet they are thinking that it’s better to have a larger total WebOS user system in place than it is to worry about protecting the company’s own hardware sales because the more companies building hardware running WebOS, the more developers have to pay attention.
It’s not without merit, but HP isn’t Google. It’s a hardware company first and foremost and as such it needs to sell HP branded tablets and phones. Let’s say a company like Asus licenses the WebOS technology and releases a nifty little tablet that is nicer and cheaper than the one from HP. Would the licensing money (and the fact they were spreading the WebOS love) make up for the fact that they were also possibly undercutting their own market?
It’s not easy to say. Nor is it clear how many vendors would want to run WebOS, adding yet another OS to the already murky mix. Android has the advantage of being open source and therefore free. Companies licensing WebOS would have to figure in operating system costs as they do when running Windows Phone 7. The question is can they price it attractively enough to make it worthwhile for companies to choose WebOS without making it so cheap they don’t make any money.
This is not a market for the faint of heart, that’s for sure. HP is late to the game and as such is going to have to get creative to force its way in. I’m just not sure if licensing is going to help them or hurt them.
Photo by Tom Raftery on Flickr. Used under Creative Commons License. ]]>
And that seems to be the general problem for the growing list of iPad competitor devices. None of them seem to realize that they’ll never compete with iPad and its 25 million served. Instead, they have to carve a niche. To me that niche, should be a device that caters strictly to business.
These devices are competing on a number of levels including hardware quality, the operating system and how well it integrates into enterprise services. Then there is price and finally and most important, there are the supported apps in whatever app distribution system the device has.
The PlayBook by all accounts certainly has the great hardware. It’s a BlackBerry, so chances are, it will play nicely in the enterprise. Pricing is competitive with iPad, but it’s severely lacking in apps. Unless it can jump start its developer ecosystem quickly, it’s a nice piece of technology without a lot of practical application for business users.
Last week, HP announced the new TouchPad running WebOS will go on sale July 1st with a price for a 16GB model starting at $499.99, the exact same price as the 16GB iPad and the 16GB PlayBook. Given the sophistication of the hardware involved, and Apple’s supply chain acumen, it’s apparently hard for competitors to cut pricing much below that, although undercutting the iPad by $50 or even $100 would certainly make these devices (all things being equal of course) more attractive to organizations looking to introduce tablets, but shy about making a big investment.
It’s also unclear how well stocked the TouchPad application store will be. As John Paczkowski wrote on All Things Digital on Friday, “As I’ve said before, its application and content ecosystem might need growing, but the TouchPad looks like it’s got a decent shot at becoming the frontrunner in the massing horde of tablet hopefuls chasing Apple’s iPad.”
That’s a big if though because the success of any of these devices competing with the iPad is going to hinge on the number and quality of their apps. Nice hardware and a well-designed OS is not going to be enough to propel any of these tablets past Apple.
The only way to sell against Apple right now, as I see it, is to make your tablet the must-have *business* device. Forget about Angry Birds. The users may crave that, but the IT pros supporting them and the CIOs buying them want these devices to mean business first and foremost.
Photo by IntelFreePress on Flickr. Used under Creative Commons License.