HP Turns Out The Lights -- On It's Customers
Your comments about this column are welcome ~ e-mail Josh at
joshlee008@gmail.com
More columns
written by Josh:
The Importance of Being Stupid
So I woke up this morning
Report From The Road
Josh Lee
Seventy Two Hours in Seattle
Seventy Two Hours in Vancouver
The Nut from the Nut Farm
The Holy Alliance
Jobs Leaves The Job

            Depending on who you are (and therefore, what your interests are) you may think of printers and cartridges of ink when you hear the name HP. Or you might think of computers, laptops and desktops. Or maybe you might think of Harry Potter.

            It’s a sad day in the technology world – it’s been a sad week, actually, one that doesn’t look like it’s going to get any better anytime soon. Technology giant HP announced a few days ago that it’s turning out the lights on its mobile devices division and will be “spinning off” it’s personal computers division.

            So this means a few things – for HP owners and for potential HP buyers. If you currently own an HP mobile device or computer (mobile devices to include the HP/Palm Pre, Pre Plus, Pixi, and Pixi Plus smartphones), hold onto it for now. They’re all still perfectly functional; it’s just a pretty safe bet that your next smartphone or PC won’t be an HP.

            Some say the business was destined to fail from the start. Back in 2009, HP purchased Palm Inc. to claim ownership over Palm’s relatively new WebOS (the operating system that runs on said phones). It was also a much-needed booster shot for Palm, who, although once a thriving company with the most popular phones on the market, was on the brink of falling into oblivion.

            For Palm, getting bought out by HP was great. From the late nineties to mid two thousands, Palm was at the top of its game. If you were in enterprise around the time, you may have carried a Palm Treo. The Palm Treo series was like the iPhone of the day. Powerful, smart, a do-it-all kind of gizmo that just happened to fit in your coat pocket. You could sync up your corporate email accounts, have all your business contacts right at hand, and even have the quarterly earnings spreadsheet right there in the palm of your hand (no pun intended). It was a miracle device for businessmen and women of the day. For many it meant freedom from the laptop. If you were traveling on business (or leisure) across the city or across the ocean, you had everything you needed on your Treo.

            The Treo, however, was put into its twilight years by the newcomer to the field – this might sound more familiar to you – the new thing that everyone was calling the BlackBerry (manufactured by Waterloo, Canada based Research In Motion). When the BlackBerry first launched, it wasn’t nearly what BlackBerry’s are today. It had a monochrome display and limited features (circa 2000-ish). The big thing about it was that after years of dominance in the market, Palm finally had a competitor and it wasn’t long before Palm found itself struggling to keep up with BlackBerry’s innovation.

            Soon, the Treo began to look outdated and, as if the two were on a balance beam, sales of the Treo fell while sales of the BlackBerry skyrocketed. The BlackBerry was the next generation of enterprise and business communication. As BlackBerry churned out new devices, it added features and enhanced the end user experience. If you own a BlackBerry today, you’ll know that the operating system is rock solid. Sure, it may not have the fancy bells and whistles of the iPhone, but the underlying software is solid. And that’s the reputation that gave BlackBerry the advantage over Palm. Not to mention that after a while, Palm’s devices started feeling like bricks from yesteryear while the BlackBerry seemed to be on Jenny Craig. (For with an interest to avenge the faithful old Treo, it may be of some contentment to know that BlackBerry is suffering the same fate against the iPhone’ and Androids of today).

            Palm tried its best to fight back against the BlackBerry. It did its best to sexify its devices and launched products catered more toward the consumer looking for a more powerful phone. It launched the (rather successful, actually) Centro, which debuted with a slimmed down body and smooth rounded lines. Once again, however, BlackBerry stole the spotlight when it introduced the Pearl, its own attempt at cornering the prosumer market (the segment of buyer between consumer and professional). Of course, by then, the name Palm had lost its luster. Owning a Palm wasn’t really all that desirable. Owning a BlackBerry, however, made you the envy of all your friends.

            And with that, Palm slowly started to fade. The death of the Treo and the Centro wasn’t entirely BlackBerry’s fault, though. Palm made the same mistake that BlackBerry is making today. When Palm held market dominance, there wasn’t really anything to compare it to, so of course it looked current and up to date. When placed side by side with the BlackBerry, the Palm looked old and dated. To add to that, BlackBerry started to churn out newer handsets with newer software that was constantly adding new features and making the existing ones easier than ever for end users to understand and use. When you put a 2006 Treo up to a 2006 BlackBerry, well, the choice for many was clear.

            But enough of the Treo and the Centro. The year is 2009, it’s June, and Palm has just taken the wraps off of its much-hyped (read: overhyped) Pre smartphone. The Pre, Palm hoped, would be the ‘iPhone killer’ (as many like to say). It ushered in a new era for Palm. Not only did the Pre completely ditch the old, unfriendly, unintuitive, unattractive PalmOS; it ditched the Treo’s brick of a body. The Pre, many thought, was beautiful. It looked like a stone you’d find in a zen garden or something of the sort. It was the launch vehicle for WebOS and was notable due to its difference from the software that powered the iPhone and the software that powered all the Android phones. WebOS’s appearance was polished and, in my opinion, is still one of the most aesthetically pleasing user interfaces on the market. It introduced features like the “deck of cards” feature for multitasking and featured a notifications system that put iPhone’s to shame and even made Androids look a little unfinished. Despite all of that, though, the Pre still wasn’t enough. It was competing with the likes of the iPhone 3GS, and just like years earlier with the BlackBerry, owning a Pre just didn’t have the style, panache, and envy-factor of owning an iPhone.

            Soon after that, Palm introduced its second WebOS phone, the Pixi. The Pixi was like the entry level Pre. It looked like a new-age Centro, and unfortunately featured the awful jellybean keyboard found on the Centro.

           
            On the brink of collapse in 2010, Palm was acquired by HP. HP claimed that it could take WebOS and give it new life. Then HP CEO Mark Hurd claimed that WebOS was going to be the future of smartphones, tablets, printers, and would even be incorporated into the desktop computer line.

            Still yet, HP was unable to revive the Palm image. It released two new smartphones, the Pre 2 (successor to the Pre line) and the miniature Veer (successor to the Pixi line) and even had the Pre 3 cooking in the oven. The Pre 2 released to lukewarm reviews, while the Veer was downright humiliated.

            Then, just about two months ago came HP’s answer to Apple’s iPad. The HP TouchPad, just like the original Pre, debuted to much anticipation and hype. Just like the original Pre, it promised to be the alternative to Apple and Android. HP saw the Touch Pad as an opportunity to bring a third software entry to the market. Again, just like the Pre, the Touch Pad wasn’t a bad looking device. In fact, it was one of the nicer tablets on the market. And WebOS is far more polished than Android.

           

            But days later when the professional reviews came in, HP was shot down once again. The Touch Pad just wasn’t a worthy opponent to the iPad and the flood of Android tablets. Just about a week ago, rumblings in the tech news had it that Best Buy was frustrated with HP’s new tablet. Its sales numbers were disappointing (estimates were set at about 25,000 units sold, and, according to one market analyst, that was being ‘charitable’) and Best Buy was sitting on an inventory of unsold Touch Pads. (In comparison, the iPad and iPad 2 have sold over twenty-five million units in less than eighteen months on the market.)

            Soon, HP had no other options but to cut the price of the Touch Pad. At launch a 16GB model sold for $499, the same price as a 16GB iPad and the 16GB Samsung Galaxy Tab 10.1, neither of which it had the guts to compete with. With the price cut, the 16GB Touch Pad was reduced to $399. Needless to say, early adopters that had since left that fourteen day return period were outraged.

            About a week after the price cut, however, analysts stated that sales hadn’t risen at all. In the technology world, it’s very unusual to see a price cut or sale on a device that’s so new to the market. In such cases, there is usually only one conclusion to be made. The product in question is flawed or unable to compete with similarly priced competitors. That’s a red flag for buyers. For many interested in buying a tablet today, the tablet world is uncharted territory. It’s new. Sure, you can compare spec sheets and what not, but numbers don’t always draw a definite or accurate conclusion. Seeing the price cut so soon in a product’s life, many ask what the problem with the device is. Why is the product unable to compete with similarly priced competitors? If the Touch Pad has a flaw that’s contributing to low sales, should I instead buy an iPad, which has gotten rave reviews and is selling like crazy around the globe? (The answer to that is yes, by the way).

            The price cut, in short, backfired. Potential HP Touch Pad buyers, those who had settled on the Touch Pad, saw the price cut and then stepped back. Again, it’s extremely unusual to see a price cut so early in a product’s life. Many looked at it and wondered if the price would fall again. They held out, waiting.

            Turns out it was to be cut again. On August 19, retailers in Canada dropped the 16GB model to $99 and the 32GB model to $149. At that price, it’s actually quite a good buy. The point, however, is that those who purchased the Touch Pad either on launch day or soon after, paid $500 for a product that is now on the market (and worth about) $99. The backlash will erupt in the next few weeks and depending on how charitable it’s feeling, HP may or may not issue refunds or reimbursements for the difference in price.

            On the upside, the ironic upside, for HP, with the Touch Pad at $99, a real steal deal for a tablet, stock drained faster than water down a freshly unclogged drain from sellers like Best Buy, Barnes and Noble, and even HP’s own online store. You can look at it one (or two) of two ways. On one hand, it was a real deal for someone that just wanted a device to access the internet and email on the go. The Internet, after all, is the internet no matter how you access it. For those who didn’t need (or want) a million apps and capabilities, the Touch Pad was a great buy. On the downside, for new buyers, their devices are going to quickly become outdated with HP discontinuing support for the WebOS platform.

 

            Over the next few months we’ll be seeing a major transition taking place at HP. Industry experts are saying that when HP’s completed the changes it’s looking to make, the company will look like IBM. It’s not clear what’s going to happen to WebOS or HP’s personal systems division. They could be sold off to be produced by a third party, licensed, or just killed off completely.

           

            And on that note, we bid a fond farewell with wishes for peaceful rest to HP (and its stocks, which dropped a record 20% to a record low after the announcement).

Midnight Flight to Washington
The Spectator
founded 2004 by ron cruger
A place for intelligent writers
A place for intelligent readers