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HP Buys Palm: What Should Happen

The tech world was taken by surprise by the news that computer giant HP (s hpq) had initiated a purchase of beleaguered Palm (s palm) for $1.2 billion. Palm has been in trouble for a while, and had been actively shopping for a buyer to bail them out. A few companies had been mentioned in the press as interested in Palm, but no one gave HP a thought. The merger of HP and Palm is probably the best possible scenario for Palm, and it will be fun to watch the process. HP has the resources to make the most of Palm’s technology, and experience at taking over innovative companies (remember Compaq?). Here’s what I think will happen with the merger, along with my thoughts on what better happen to make this work.

HP is in a unique position to take advantage of the Palm takeover. It is in the phone business, but not really. HP was big in the PDA segment for years, but never made a successful transition into the smartphone age. There are good people in this area with HP, but they’ve never been allowed to innovate. The absorption of Palm into the HP Personal Systems Group will be an infusion of talent and know-how that HP can leverage immediately.

That is first and foremost what the new HP/Palm team must do — release a new webOS phone that blows Palm’s past phones out of the water. Take HP’s great skill at producing top-notch hardware, and pair it with webOS to make a smartphone that will take the segment by storm. I have no doubt it can be done, and it must be done quickly to create the buzz needed to make people watch HP’s phones going forward. Make a webOS phone with hardware that rivals anything in the Android segment. Prove that webOS, coupled with outstanding hardware, is the best smartphone platform available.

HP must focus on the Palm/webOS effort in its phone business after the merger is complete. Drop Windows Phone 7 and work solely with webOS; no dilution of effort in the phone business. Palm’s OS is as good as anything on the market, so take it and run with it. Continue to innovate and grow the OS with the help of the Palm team. Send a clear message to the smartphone community and market that this is your product.

Throw a lot of resources into the Palm developer community. This is crucial to the success of the platform, and HP has the muscle and money to make it a vital part of the equation. Get developers to embrace the platform, no matter what it takes. Bring back those developers who have dropped webOS due to Palm’s problems. Make this a priority within HP and the phone group. Throw a boatload of money at developers if you must, it is crucial to the future of the platform.

Drop the Palm brand. This is not something I say lightly, I am nostalgic about Palm and the brand. But I believe it is vital that HP send a clear message to the industry that it is behind the webOS platform 100%. A clear way to do that is to bring it into the HP branding scheme, and quickly. Go all in with Palm by bringing it totally into the HP family. On every front it is important to send a clear message — Palm is HP now, and we are going to run with it.

Produce a webOS tablet that rivals the iPad. I firmly believe the webOS platform is a good one for such a product, and HP’s expertise in making mobile computers can be leveraged to full advantage in such a device. This will create a new product line that has amazing potential for HP, and all of the pieces are already in place with the merger to make this happen. HP can still go with the HP Slate, although that is just a netbook without a keyboard. What will be better is a thinner, lighter tablet with a mobile OS. That will truly compete with the iPad.

An HP tablet with webOS opens up the possibility for an ecosystem that can take on the Apple/iTunes/App Store. HP has the clout and expertise to use the webOS phone and slate lines to add apps, music and video to the mix in such a way that eventually HP can take on Cupertino.

The merger of Palm and HP will not be without cost cutting, and that means losing good people. It is inevitable given the high price paid for Palm. HP must do this intelligently, and without hampering the Palm team too severely. Make the combined team work well together after the merger. The priority should be fast release of new products that make a difference.

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27 Responses to “HP Buys Palm: What Should Happen”

  1. I doubt that HP will be able to produce anything useful and in time so as to jump ahead Android and iPhone…becasue there will be so many challenges ahead….

  2. I am very interested in a Web OS tablet for education. A separate store for educational content is required in order for the environment to function. HP could also help groups to build cloud infrastructure ala Amazon providing direct bindings to database and repository tools on a consistant and attractive pricing level. The result of such an act would be to ensure that developers know that HP is interested in the space, not in our business models.

    With respect to music, Apple would not allow our apps to be approved and then came out with LP some months later. HP could similarly partner with somebody like Amazon to get music store functionality, some people do buy vinyl!

    Create an ecosystem! And, get some contact info, so that we know who to contact about projects.

  3. brain

    I would just go back to the old palm os and start from there with the pad that they had design way too long ago. To me palm os the old one is the best in the market and they should start from there. they should offer handhelds for the industries and would add wify to all of them. this would make for a good tommorrow

  4. HP pull the tablet/slate they were showing to re-engineer it to run web os and relaunch it for christmas.

    hp to announce new hardware for launch december timeframe.
    New hardware to wun web os and be 3 new phones and 1 pda to compete with the ipod touch.

    Those are my pics

  5. I was with you up to the last two points. Further, I would encourage HP to set a goal of announcing a new WebOS based phone within six months, with appropriate “leaks” in the meantime.

    HP should stick with the Palm brand, just as it did with the iPaq moniker. Palm has a cult-like following which should be cultivated. Just ask Steve Jobs.

    Another lesson HP can learn from Apple is not to rush into new areas until your footing is secure. While undoubtedly HP will leverage its new acquisition to the extend demand warrants, WebOS does not have a good track record in the marketplace and success is by no means guaranteed. Better to concentrate effort on the next generation of WebOS and phones, shore up carrier relationships, attract app developers, all with and eye to expanding market share.

    With user and carrier confidence assured and a growing piece of the market in place, HP would then have what in needs to expand WebOS into other products. And if WebOS doesn’t work out, which is always a possibly, the collateral damage will be limited.

  6. This is really exciting and I definitely didn’t see that coming. I was hoping HTC buys Palm since they have the experience to handle multiple platforms at the same time but I think this is even better. Good for Palm as well as HP. The iPaqs were decent enough and I would love to see what HP comes up with Palm.

    Aren’t the WebOS devices also ARM based ? Can’t HP just contract HTC to build them a device that looks as good as the HTC Legend and put web os on it ?

    • Hashish Jihadi

      They could get HTC to build but if HP really sees Smart Phones and Web Tablets as the future they may start building a vertical hardware infrastructure to support the “future” computing model (ala Apple). HP certainly has the Engineering Know-How to make their own ARM SoC without too much difficulty. The main thing is to keep a keen eye on Apple at all times and be ready to change direction at a moments notice to keep up.

  7. I agree however the lawyers may slow things down. It seems they are trying to get in on the cash saying that HP may not be paying enough for Palm. Getting the deal done will be the biggest problem. Hopefully the deal will go quickly and we can all see some amazing WebOS products hit the market quickly.

  8. lsbeller


    Your focus is all about hardware. I know you mention the developers but I am suprised you didn’t give it more importance given Kevin’s whole reason for dropping his palm pre was lack of applications.

    My take from listening to your podcasts and reading your posts has been that it’s all about how people use their devices and applications play a major role in that.

    Am I wrong?


  9. I agree with you on every point, except for dropping the Palm brand. The established and familar brand is almost certainly one of the most valued assets that HP just purchased and likely influenced the somewhat higher than expected price.

    I do think that HP should put their own logo on the devices and packaging, but that they should retain the Palm name and logo as their umbrella brand for mobile devices. It is certainly a more valuable and recognizable (and probably better regarded) brand than iPAQ.

    As for the comment that the name didn’t help Palm much, I think that is incorrect. Do you really think that WebOS and the Pre/Pixi would have gotten as much attention and achieved the even limited following that it did without having a familiar brand name behind it? The combination of a well-regarded, familiar brand with HP’s financial and marketing resources behind it could be very formidable.

  10. This is great news for Palm & WebOS Fans and long time Palm customers. I think if HP and Palm are integrated well that they will successfully compete with Android and the iPhone OS.

    I’m a big believer in the platform, and HP will move it back in contention, but some major damage has been done. The fact that the Pre and Pixi were Sprint only for so long left us GSM customers to either buy a phone overseas or to stick with our older Palm OS phones. That odd/horrible ad campaign for the Pre and Pixi, what were they thinking. I just want a quick and effect expansion into all carriers with more appealing physical hardware.

    I’m not sure that I agree with James on the WebOs tablet, there isn’t a significant App catalog, it will be in 3rd place as far as Mobile OS tablets go and as fast as the HP machine is, it isn’t that fast. Apple has a significant lead, the Android Tablets are months away. WebOS in a Foleo tablet won’t cut it.

    In the smartphone market, HP will accelerate the growth of WebOS and thank god for that. In the tablet arena they’ll be playing catch up for a long time.

  11. 1 more thing i would add… since it’s clear the amount of interest over this takeover is extraordinary through the press, blogosphere, gadget sites, etc. at LEAST on your 1st big public outting with new products do it “Apple style” by inviting all the press you can fit. regardless of sales, currently Palm is the only non-apple company with an OS that can generate this kind of attention amongst the press, now backed by the largest tech company in the world makes it even more coverage worthy. Googles division & MS’s no-show so far are keeping them out of them glamor circle.

  12. As stated here webOS is great, also lastest palm´s hardware is cuestionable and yes, may be hp could make a great hardware for webOS to run, but the funny thing is that HP has no idea about go to marktet in the smartphone segment, so they bought Palm, and Palm failed completely in the go to market lately too…

  13. I have to admit I was pretty stoked when I heard this, I hope HP puts some money behind the platform and lets it shine. This platform is perfect for small tablets and could deliver real competition to Apple.
    Apple has a marketing machine second to none, look at this win they pulled out of the so-called missing iPhone debacle. Millions of dollars of free publicity for something we’d all here about in a month or two anyway. If it wasn’t planned it should have been.

  14. I side with Nilay Patel on this one, the ghost of Voodoo whispers to the future of Palms innovation. I think most creativity will be stifled by the relentless bottom line machine. I hope not, as I love WebOS on my Pre.

  15. prethought

    I think changing the name is definitely the wrong move. Keeping the Palm name says we invented this niche market and we are still here and will reclaim our marketshare that we dominated in the late 90’s. The future tablet should be called the HP PalmPilot. Couldn’t you imagine the slogans have the world in the Palm of your hand with the HP PalmPilot. You’ll never be lost with HP PalmPiliot on the only 4G network. It was U.S. Robotics, 3Com, then there was the great skism of Handspring, then the rejoining of Handspring and Palm. The Palm name needs to stay even if only in model naming.

    • Agreed. HP still sells computers under the Compaq moniker, on the one hand. On the other hand is the disastrous experience most end-users had with HP-branded mobile devices towards the end of the line. Palm is a legendary name in the mobile world. HP should keep it, and not emphasize the HP. “Palm, by HP” at worst.

      • Nameless

        Speaking of said Compaq acquisition:

        Before, in the Windows CE/Pocket PC/Handheld PC world, you had Compaq iPAQs and HP Jornadas.

        After HP bought Compaq, what do we see? HP iPAQs. Never another Jornada.

        Makes me wonder how this will turn out. (HPalm?)

  16. This was unexpected. I think HP paid way too much cabbage for a failing company. Hopefully they can make some bigger more exciting hardware platforms to run WebOS on. I would expect to see a speed tablet soon, anything would be better than Windows on a tablet (as previous HP tablets failed with the horrific Windows UI). Must also create a monster app store to rival Apple even if they have to initially pay top tier companies to port popular apps.
    HP may be the largest PC company in the world but they still have a lot to learn about mobile gadget industry.

    Another thing HP should do is leverage their powerful Printer divison and create a universal cloud-based mobile printing solution ASAP (before Google takes over worldwide printing market for itself). HP should put firmware updates into all its printers to enable cloud-based printing solution. Now Get Busy HP…no time to waste as the mobile space move much faster than the turtle pace of the PC. :-)

  17. Agree on every detail, with an addition: HP needs to continue to support the Homebrew community. These folks are among the most fervent evangelists for the platform, and HP cannot afford to alienate them if they want to bring WebOS back from the brink.

  18. This is really the most exciting news of the year, even over the iPad. Because it now means there will be real competition to Apple. Devs won’t have to simply drop their pants and bend over to try to make a living in the mobile space. webOS is superior to Android in many ways. And it’s not fragmented.

    What I want to see is Adobe commit to webOS. Bring over Digital Editions, so webOS can borrow Adobe DRMed books from public libraries — something the iPad cannot do. That would also allow people to buy books from all of the existing stores out there that use Adobe DRM.

    I’m really happy to see webOS has a future now. This is very, very exciting. And I want a webOS tablet!

    Hey, Kendrick you fiend, since you’ve been using webOS all this time, we need a post from you about how you’d envision webOS on a tablet.

    • prethought

      There is still a huge potential for webOS as a smartphone. They just needed real marketing campaign. Palm didn’t convey how much better webOS is than anything out there with their retarded zen commercials. I don’t think Palm would have been in this predicament if they had a marketing campaign that actually showed how great webOS is. If people new how awesome webOS was there would have been a greater uptake and marketshare growth. Then all we would need is a new faster better model in June.