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Summary:

Hewlett-Packard CEO Mark Hurd last week said his company won’t aggressively pursue the smartphone business in the wake of its acquisition of Palm. The move would be an enormous missed opportunity for HP, and it also could shackle its efforts to produce interconnected devices.

Hewlett-Packard CEO Mark Hurd last week said his company has no plans to aggressively move into the smartphone business, following the $1.2 billion acquisition of Palm. Which means HP is about to miss out on a tremendous opportunity to become a major player in mobile — and the move could hamper the company’s efforts in the larger world of connected devices.

As I discuss in my weekly column over at GigaOM Pro (sub req’d), this seeming indifference to the booming smartphone market is inexplicable, and it could actually harm HP’s long-term goal of churning out a variety of interconnected devices.

It’s true that the coming wave of connected devices will present enormous opportunities for developers and manufacturers. And I understand that the smartphone business is a crowded space where three dominant platforms (Android, BlackBerry and iPhone) are fending off a host of challengers. The field will get even more congested later this year when Microsoft trots out its Windows Phone 7 operating system.

But the smartphone market is growing twice as quickly as the overall mobile market, according to IDC, and it will continue to expand dramatically over the next few years, meaning there’s plenty of opportunity for the smaller guys. And smartphones — along with their attendant app stores — will encourage adoption of the applications that help drive demand for those interconnected devices, in the same way that Apple’s iPad and iPod touch are extensions of its iPhone business.

HP now has the technology and the carrier ties to learn from Palm’s mistakes and build out an applications business that is built on smartphones but that also drives demand for other connected gadgets from HP.

Read the full post here.

Photo courtesy Flickr user The Shifted Librarian.

Growing its developer community would allow the company to build out its webOS Application Catalog, which still offers just a fraction of the number of titles carried by Apple’s App Store or Android Market. (And HP will have to spur development of webOS apps regardless of its plans in the smartphone business.) The meager portfolio of webOS devices needs to be expanded with fresh, new handsets. And HP may want to do away with the webOS brand, which has mindshare among techies and some early adopters but simply doesn’t have the consumer appeal of catchier names like iPhone or Android.
By Colin Gibbs

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  1. Marcelo Calbucci Saturday, June 5, 2010

    Colin, HP saying “…has no plans to aggressively move into the smartphone business” and buying a company on the Smartphone business for $1.2B is quite contradictory.

    HP has a plan. HP want to be the leader in mobile devices. However, they have too many relationships right now with companies like Microsoft, Intel, and others to make statements that could jeopardize those relationships.

    1. agree. I dont anyone would believe such a statement anyways.

  2. Markus Goebel Saturday, June 5, 2010

    They’ve sent this PR statement to Engagdet, Boy Genius Report and other blogs. It states that we understood everything wrong and HP wont leave the smartphone space, smartphones will be a part of a wide array of mobile devices with Web OS. Didn’t you read that? I think it takes all the steam away.

  3. Ramon B. Nuez Jr. Sunday, June 6, 2010

    They have no plans to “aggressively move into the smartphone business.” I am hoping that IBM is at least surveying the mobile landscape? According to 3G Americas there are roughly 3 billion mobile subscriptions today with an anticipated 5 million subscriptions by 2015. With LTE being adopted by the major mobile providers — the wireless broadband ecosystem will fuel handset penetration. Let’s not forget that it’s the apps that that subscribers love to use — so IBM will also need to have a solid app store.

  4. webosCorrect Sunday, June 6, 2010

    This article topic is old news. Didn’t you read the latest news followup regarding HP CEO clarifying that they will OF COURSE continue to build webOS smartphones? And that statement was taken out of context? Bottom line is, HP is still on track to support the development of next generation webOS smartphones including tablets, printers, and other future products.

  5. How To Succeed With Forex Trading Signals | A Review of StealPIP's Sunday, June 6, 2010

    [...] Hey, HP, the Smartphone Market Is Calling [...]

  6. Colin Gibbs Sunday, June 6, 2010

    As I pointed out in the longer piece on the Pro site, Hurd said flatly that HP “didn’t buy Palm to be in the smartphone business.” And I think it’important to note that he was speaking to investors at a tech conference, so it’s not like these were off-the-cuff comments. HP’s follow-up did soften those statements slightly (again, as I noted in the Pro piece), but the company didn’t clarify its intentions regarding hardware. So I think we have to take Hurd’s comments at face value.

    My point is this: The smartphone space is still wide open, and HP now has key components in place to become a major player. It’d be a shame to see them pass up that opportunity.

  7. The biggest irony in these statements, is that some eons back, HP was actually a highly prized Windows Mobile handset.

  8. I can now say HP wants to kill PALM. Read the new press release on HP’s email connected printers partnering Google. They forgot to mention WebOS. Its time for the Ruby and co to leave HP say in six months.

  9. Besides , it looks to me that Hurd guy is not a “Techie”, he is a “Manager Type”. You need a management consisting of Engineers to understand the business (yes , engineers understand the business better than the Managers with Business degree).

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