The ex computer maker HP

Does WTF count as 1 word?

If so that’s the only word I have for the news that HP is selling its computer manufacturing biz.

I’ve worked with HP for years, and I know they have fingers in many pies. But exiting such a major part of their business seems odd.

Years ago I worked for Bass the brewers, I worked in the bit that looked after the pubs. We got a new boss who used to work for a hotel chain. He sold off all the pubs and bought loads of crappy hotels the other chains wanted rid of, and within a year turned Bass, a very successful brewing and pub management company into a 3rd rate hotel company. I don’t know what happened to the company in the end, bought out by some 4th rate, social climbing, hotel firm probably.

What I never understood though was if he wanted to run a hotel company why he didn’t get a job at thf (remember them?) or holiday inn or whatever. Many of the beer brands are still going strong.

So HP have got in an ex software CEO who wants to turn the worlds leading PC manufacturer into a software and service co – WTF??? couldn’t he get a job at a software co? Or maybe HP couldn’t get anyone else – they haven’t had the best success with CEOs for a few iterations. Thinking about it I don’t think I have ever had an HP pc. But I did want an Ipaq for a long time (when they were cool ;-)).

I understand of course that under certain circumstances SW can be more profitable then HW. But I never understand these companies that exit their core competency. Focus, defocus, invest, divest, spin off, fine, but abandon the core?

Why do they do it? (apart from dysfunctional bonus schemes of course!)

cheers

Simon

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8 Responses to “The ex computer maker HP”

  1. excelandaccess Says:

    It is odd, but others do odd things as well. Why does the iPad not have a BlueTooth phone capability? Most iPad users also own an iPhone. Data plans for each, without a discount. A bit greedy if you ask me. Many firms do odd things. This one from HP is HUGE. It will be interesting to see what happens over the next 18 months.

    Excel Consultants and Access programmers

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  2. Mathias Says:

    I was also caught by surprise, but after second thought, it looks like a remake of IBM exiting the PC to become more of a consulting/services company, which seems to have worked decently well for them.

  3. Simon Says:

    HP have a massive prof services div, they are huge offsite help desk providers for example. But that is part halo effect from their server biz.

    I’m not saying it wont work, but to me me splitting the services and the hardware, should be just as possible within the same co, no need to sell it off. unless they need the cash…

    And who wants to buy pc manuf capacity at the mo, on the brink of the second recession in 3 years (assuming you believe we ever came out of one(I don’t)), with the ipad disrupting things – half seem to think its a fad, the others are busy trying to build cheaper better copies.

  4. Robert Bruce Says:

    The company I’m currently working for has just switched its hardware buying policy from Dell to HP. Amazing foresight.

  5. Simon Says:

    oh – the irony Rob … (I think my place just went the other way)

    seems I am not alone in my wtf:
    http://developers.slashdot.org/story/11/08/29/0052207/Ex-Board-Member-Says-HP-Is-Committing-Corporate-Suicide
    (love the ford boeing analogy.)

  6. Harlan Grove Says:

    I can understand exiting PCs, which are low margin except for very high end gaming machines (which don’t sell many units). I can understand exiting printers, which has become just as cut-throat. But I remember the HP instrumentation equipment from the dim past of my youth spent in electrical engineering labs where HP devices were far & away superior to the alternatives. HP exiting the small and unglamorous world of oscilloscopes and medical sensors is almost unthinkable.

    OTOH, it does look like HP’s Palm purchase was a really, really bad mistake.

    HP wants to be the next IBM, but last I heard IBM still makes mainframes and minicomputers even if it doesn’t make PCs.

  7. Martin Says:

    Simon,
    the hotel arm of bass became six contintents which itself later split to become Pub Mismanagement firm Mitchell and Butler and hotel group intercontinental http://en.wikipedia.org/wiki/InterContinental_Hotels_Group

    You’d still be around when Bass brewing arm was sold to Inbev that itself was taken over by the rice brewers AB. AB had to sell of much of the Bass brewing portfolio due to competition rules and rumour has it Bass may be hived off now.

  8. Simon Says:

    So Apotheker finally got the boot, but what will happen to the people who brought him in?

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