HP CEO Says Intel and Microsoft Turning Into Competitors
HP CEO Meg Whitman states what has become obvious since the launch of the first Surface tablets.
While talking with Wall Street investors and analysts on Wednesday, Hewlett-Packard CEO Meg Whitman blamed some of the company's growth problems on Intel and Microsoft, pointing out that both companies used to be long-time partners, but are now becoming direct competitors instead.
"HP's traditional highly profitable markets face significant disruption. Wintel devices are being challenged by ARM-based devices," she said. "The disruptive forces are very tough and very real, and they are accelerating. We are seeing profound changes in the competitive landscape. Our competitors are expanding across the IT stack. Current partners like Intel and Microsoft are turning from partners to outright competitors."
At least on Microsoft's part, the move to become more of a competitor than a software supplier couldn't have been more clearer than with the release of the first Surface tablets. Last year the Redmond company entered a hardware space previously grazed by Apple, Samsung, Dell and HP, and now Microsoft is doing it again with the second generation models. Microsoft will likely take an even bigger stab at the smartphone market with the upcoming acquisition of Nokia's devices and services division.
HP seemingly began distancing itself from Microsoft back in May when the company's earnings included a 20 percent dip in revenues for the PC business. Like many other OEMs, HP has discovered that it can no longer rely solely on Microsoft, and instead is quickly turning to Android, Chrome OS and Ubuntu for alternative, cheaper operating system solutions. This is a 180 degree turn from the "we have to stick with this, I am a believer" stance Whitman took regarding Windows 8 back in January 2012.
HP took another blow in the PC department in August, reporting an 11 percent drop. The company also had to admit that total revenues would not start growing in fiscal 2014 as promised. Yet HP has pushed on with its alternative OS plan, and just recently introduced the $279 Chromebook 11 that's currently on sale on Google Play. HP actually worked with Google to develop the device, seemingly flicking its nose up a once-best-buddy Microsoft.
"I am still not pleased that we missed too many opportunities," she admitted. "We are doing a much better job of connecting to our customers and listening to what they need. I don't think we have always done a good job on this. We have to up our game substantially. We have been too insular for too long. This has cost us with our customers, and it has cost us with our partners."
As for Intel, HP competes with the CPU giant in a number of enterprise-based businesses such as computer security and cloud computing. HP competes with Microsoft in the Enterprise systems and services realm as well, and is facing an even bigger threat now that Microsoft's rollout will begin later this month.
AllThingsD has a live blog of Wednesday's speech in San Jose, which can be read here.

Now HP is left with having to go Android, which is not a bad thing, but they had their own and they screwed it up.
The boardroom shenanigans at HP had them distracted apparently, the company's seemed to just languish since the Compaq deal and Carly shutting down so many domestic design labs.
Now HP is left with having to go Android, which is not a bad thing, but they had their own and they screwed it up.
Oh I know, I bought a Web OS tablet when HP had their fire sale. I've used it a lot in comparison to my iPad. I really like the multitasking features of Web OS where it could run tons of applications side by side compared to what iOS and Android could run side by side. It just sickens me - HP bought Palm, had a great product with Web OS, and then did absolutely nothing with it. Palm should have refused HP's offer and then gone and developed Web OS on its' own.
i'll get Lenovo or ASUS instead of HP and their Compaq
Personally, I don't think WebOS would make such a difference. It might have been good, but too many people were already caught up with Apple - it took years of aggressive marketing by Samsung and Google to conquer the market for Android. A third competing OS... we all know what kind of market share it would have, just look at Windows mobile. No, despicable build quality and lack of interesting products in already-existing parts of the market is what failed HP and they're NOT learning a lesson from it, instead whining about how it's all MS and Intel fault.
Southernshark - Intel has delivered many viable mobile chips lately, namely their ULV Haswell i5s and i7s. They might not go into phones and tablets yet but they go into convertibles with very decent battery life and great performance for such a puny device. As for decent graphics, even now they already have HD 5200 aka Iris Pro - it makes all lower-end discrete GPUs obsolete since it can compete with GT620 (so forget all low-end AMD garbage and so on). For most consumers, that's more than good enough. Don't expect that integrated graphics will somehow magically catch up with discrete, that's not happening.
The standard Surface and Surface 2 tablets use the ARM CPU which is part of the Tegra 3 platform. The Surface Pro does use a Core i5.
Watch the language. - G