The merger of HP and Palm was anything but smooth. Having purchased products from both companies I thought something great would happen. I thought Palm would now have what it needed to be become great again. Boy, I could not have been more wrong. Read my thoughts on why we should have seen the downfall of Palm.
So the last 48 hours has been quite a busy time for tech enthousiasts. On the wake of Google buying Motorola HP is now ditching the WebOS hardware devision it just purchased 1 yr ago. Below is a sad and very dry earnings call by HP announcing the death of WebOS.
http://cdn0.sbnation.com/podcasts/HP_on_webOS.mp3
So it seems by listening to this earnings call HP wanted a tablet to rival the iPad, gave it 3 months to start making an impact, and pretty much gave it a small budget to advertise the next generation of tablets. Maybe HP should learn how to startup a new product by looking at Microsoft. Microsoft just spent $1 billion to market WP7 and it still only has 4% of the smartphone market after 10 months. Microsoft also did not make any profits on XBox for almost 6 years and it is now the top gaming system on the market by far. I'm not here to talk about Microsoft though, so let me give you a rundown on why the HP-Palm merger did not work.
Let me take you back in time a bit. Back in 1992 Palm Computing Inc is founded as a software company relying on Tandy and Casio to make the first gen Palm Pilots. A few years later they are bought by 3COM. At the time 3COM owned Palm life was not good, so a lot of the people decided to get together and create Handspring in June 1998. While this was going on 3COM was making the hardware a publicly traded entity keeping the Palm name. Eventually the two companies Handspring and Palm would combine again to make PalmOne Inc. in 2003 and all of a sudden Treo's were developed to create the smartphone. Yes, all of the amazing little gadgets we call smartphones (Blackberry, iOS, WP7, and Symbian) all came after the Palm smartphone. 
Alright, so now we know who Palm is, let's talk about HP. That huge PC maker that announced it was purchasing Palm in 2009 for $1.2 billion. At the time of the merger Palm was having a hard time getting people to buy in on WebOS, their new web based operating system that first added cloud storage to smartphones. Microsoft, Google, and Apple all jumped on that bandwagon years later. HP probably saw some value in what Palm was trying to do, and probably saw some big value in the hundreds of patents Palm held. Can you imagine Palm suing Apple for making a smartphone? It can happen, which is why no one has tried to sue HP during the last year when everyone is suing everyone for patent infringement. Microsoft is even forcing Samsung and HTC to pay them for selling Android phones because of a few patents they bought from Palm years ago. So HP had great reasons for buying Palm.
Here is where things went wrong for the Palm and HP marriage. During the honeymoon of the merger Palm came out and said they were going to make a tablet and more powerful smartphones. Sounds great right? Well, during this nice announcement HP decides to hire Leo Apotheker in 2010. None of you probably know who this guy is, but he used to work for SAP who were buddy buddy with Oracle and made server software for the corporate end. Oracle threw a huge hissy when Leo left for HP and proved that Leo stole Oracle's intellectual property. What a great CEO right? And what does he know about hardware? Yeah, that's Leo
So now a business minded software thief is running HP who makes hardware. Fast forward another year. HP is now ready to roll out 2 smartphones, the Veer and Pre3, and a tablet known as the Touchpad. They show it off at CES 2011 and it makes a lot of noise, but we still have not seen any advertising. So April rolls around and the Veer hits ATT with a "soft" roll out. In the retail world that means we don't quite want to spend millions on advertising so we will see if any one buys it without us pushing it. Well, let's just say it never had a chance because I bet none of you reading this blog have seen that phone. So shortly after that in May, the Touchpad finally hits market. Still no major advertising and is sold exclusively at Staples...yes people you read that right. Sales are so bad in July they started dropping the price to sell. August 1 Best Buy tries to sell 250,000 tablets back to HP because it is not selling. But the ads finally hit with Manny Pacquiao, that will save the day right?August 28, 2011 HP announces the death of Palm. And good old Leo released this fun statement explaining HP's new focus.
"strategic priorities of cloud, solutions and software with an emphasis on enterprise, commercial and government markets".
Like I didn't see that one coming.
So what does this mean? If you want a cheap laptop the Touchpad is starting to drop to just $99 and if you can ever find a Pre3, which never hit market, you will be a tech God.
Generally, I wouldn't bash a company, but the last few years I have seen HP turn into a very bad company. The choice of Leo for CEO, poor marketing, and the horrible return and customer satisfaction rates have put HP on my black list. What makes me feel really horrible is that I have promoted their PCs and laptops many times. For this, Chucktown community, I am truly sorry. And for all of you who linger longer you will notice in my laptop comparo HP was nowhere to be found.
Thanks for reading people and go buy the new collector's item HP Touchpad.
