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HP's Lack of Invention is Why webOS Failed

By - Source: Tom's Guide US | B 57 comments

I cannot remember a time when I would have considered HP an emotionally charged company. As far as excitement goes, HP is about as arousing as a toothpick. Today, however, is different.

I believe it would be fair to say that investors do not approve, or, at the very least, do not especially like HP's new plan how the company plans to sail into the future. The company said that it be trying to sell its personal computer business, which is a major revenue source for HP. This was questioned not just outside of HP in the investor community, but especially by the services guys inside HP who never missed a chance to trash HP's interest in building consumer PCs.

Of course, there was also news that HP canceled its webOS hardware devices and is now leaving the future of the software in question, which essentially will cost HP at least about $2.5 billion to get rid of one of the greatest opportunities it had in a long time and is now left with the only choice to kill whatever is left of Palm, the company that pioneered mobile devices as we know them today. HP is served a broadside from the financial community today, with the most critical piece being Jeff Reeves' article that compares HP to the "worst of corporate America."

I would not be so dramatic, but he has a point and there is much in this claim why webOS failed inside HP. WebOS failed for the very same reasons why VoodooPC failed as part of HP as well, for example.

HP today: Invent?

A few months ago, we heard HP CEO Leo Apotheker saying that he would hope that HP could be as cool as Apple is today. However, realistically, what is HP today and what do we think it will be without webOS and the PC business? A printer manufacturer? An enterprise services company that uses fancy names for trivial technologies described in Powerpoint presentations that put the company's clients to sleep in a matter of minutes? Even in its enterprise business, HP seems to have lost its fire and we know that the company has been searching for direction for some time. A direction that has changed course several times since CEOs Carly Fiorina, Mark Hurd and now Leo Apotheker.

In servers, HP always had issues going after IBM and it was the profitability of IBM services that drove HP into this market as well. Yet HP never achieved the high profile and reputation of IBM in this market and could only grow its reach via substantial acquisitions, such as Autonomy now. It is not difficult to see that HP will be moving much more into the enterprise market and services than ever before. However, even in that space, HP may have problems at the very core as the company is turning into a giant that is the opposite of being nimble.

Its perennial rival IBM may be larger than HP, but it does much better job at being perceived as an innovation driver across all of its business segments -- for example, with chips that are built using neuron-like structures. HP has its famous labs as well, but, honestly, when was the last time you heard about a significant innovation that has come out of HP? You can take this innovation game even further and look at the patent space. HP filed 2 patent applications with the U.S. PTO this week, IBM filed 44 and Samsung filed 98. On an average week, Samsung is filing for 130 new patents every week, IBM for about 120 and HP for about 15. The activity coming out of HP does not reflect the size of the company. If the number of filed patents that protect any innovation in fact are a sign for the innovative power of a company, then I would claim that "invent" is not be the best word to describe HP anymore.

A Colossal Mistake: webOS

The acquisition of Palm and webOS was an interesting move. For pocket change ($1.2 billion), HP bought itself an ailing, but very capable platform that could have changed the face of HP. WebOS was the foundation of a platform that screamed "innovation" much more than anything else HP has in its product portfolio today. There was initial enthusiasm for webOS and an opportunity that connected nicely to HP's position as leading PC manufacturer -- its aspirations as a smartphone company as well as the emerging tablet market that so heavily depends on a functioning platform. HP had the resources to build webOS into something great. What HP did not have was time and passion.

HP gave the Touchpad 49 days to succeed or fail. 49 painful days that jailed a fantastic OS in barely adequate and over-emphasized hardware. 49 days that proved that consumers will not just buy a $500 tablet because we all suddenly think that they are the best thing since sliced bread. In Leo Apotheker's more pragmatic words: "Our WebOS devices have not gained enough traction in the marketplace with consumers and we see too long a ramp up in the market share. Due to market dynamics, significant competition and a rapidly changing environment and this week's news only reiterates the speed and nature of this change, continuing to execute our current device approach in this market space is no longer in the best interest of HP and HP's shareholders. Therefore, we have made the difficult but necessary decision to shut down the webOS hardware provisions within Q4 2011." What Apotheker failed to mention is that it was not "market dynamics, significant competition and a rapidly changing environment" that killed webOS hardware -- it was HP.

When HP acquired webOS with Palm, it was clear that this was a very fragile foundation for a new and highly marketed environment that required as much brainpower as risky and substantial monetary investments. The Touchpad was the first attempt. Like all Android tablets on the market today, the Touchpad lacked the reasoning, vision and passion that makes the iPad so successful. HP did not court webOS developers. Instead of a truly unique tablet, it produced an iPad copycat and sold it for the same price as the original. What reason would consumers have to buy the Touchpad over the iPad, if there are fewer apps, if there is a questionable future, if there is no platform integration, if there are no compelling phones, and if the iPad carries the innovation mindshare and all bragging rights? Releasing the Touchpad in its current form was driven by negligent market and consumer research at the very least.

HP had tremendous opportunities with webOS. It could have given the software away for free to invite developers. It could have create a huge platform spanning from PCs, appliances, smartphones to tablets. What is left is webOS with nowhere to go. There is talk that HP may try to license it to HTC or Samsung. I am not quite sure what HTC would do with webOS. HP calls this strategy now "optimizing the value of WebOS" after it virtually killed it with sub-par hardware.

Failure by design

HP has always had trouble integrating young companies and new ideas into an aging corporate structure that may not be so competitive anymore. Rahul Sood from VoodooPC left HP's PC business earlier this year and joined Microsoft. VoodooPC, at least temporarily, gave HP the perception of being an enormously innovative company that took a playful and risky approach to set trends and not follow them.

WebOS is a deeply emotional product that failed inside HP most likely because of the same reasons companies like VoodooPC failed. Unless HP recognizes the opportunities it is given, unless it returns to the roots of innovation and becomes much more nimble and passionate than it is today, HP is simply stuck in a time that is slowly fading away. Apple is the poster child of what passion for its legacy and products can do for a company. HP needs to embrace the same spirit that is driving companies such as Apple and Google, whether it deals with business or home users.

WebOS represented the passion that HP so desperately needs. The strong reaction of investors that sent HP's stock down 20% to a six-year low may only be one indicator of HP's shaky future. Hp cannot afford to miss many opportunities such as webOS.

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Top Comments
  • 20 Hide
    11796pcs , August 20, 2011 2:53 AM
    HP let their tablet fail just like Microsoft does so often with their products. They didn't support it. They also weren't able to give it any resources or time. I agree with clonazepam- I too equate HP with cheap molded plastic. And it's one thing if your products are solid but not very flashy or innovative (think Lenovo) but it's completely another if your products are trash that have zero reliability and are not consumer friendly. Oh and by the way, installing 20 different trial programs and useless applications is NOT consumer friendly, especially when you do stupid stuff like sell laptops running Vista with 1 GB of RAM to unsuspecting consumers along with all the bloatware.
  • 16 Hide
    fyasko , August 20, 2011 2:37 AM
    webOS failed because HP has retards at the helm.
  • 10 Hide
    kartu , August 20, 2011 9:27 AM
    You can invent reasons like "lack of innovation" but it's not why it has failed.

    A couple of weeks ago I didn't even check what it does, before ruling it out, when considering what tablet to buy. Yet another web platform, pushed by a single manufacturer who's just trying to gain market share, didn't sound promising at all, I saw this obvious end coming, albeit not so soon.

    And all the blabla about cool platforms, dual/quad core CPUs, gigapuxel cameras with 2mm lens, wake up people. It's all crap. Screen quality, smooth UI (and no, you don't need dual/quadcore for it, just optimized code, not bloated bytecode running in a JVM with no JIT) and battery life is all that one has to care about about these gadgets. Oh, and the fact that you can install applications on it, without needing some greedy bastard's approval.

    And one more thing, pardon if it hurts your feelings, but mobile OS functionality at the moment is VERY VERY VERY BASIC. Even this basic thing is hard for google to keep it up, but only because there are gazillion of hardware configurations to support. There is NOT A SINGLE mobile OS out in the wilds, having more functions than what a group of dozen developers could achieve within 12 month using Linux as a base (for a particular gadget).
Other Comments
  • 6 Hide
    clonazepam , August 20, 2011 2:18 AM
    A good read. First thing that comes to mind when I think HP is cheap molded plastic.
  • 16 Hide
    fyasko , August 20, 2011 2:37 AM
    webOS failed because HP has retards at the helm.
  • 20 Hide
    11796pcs , August 20, 2011 2:53 AM
    HP let their tablet fail just like Microsoft does so often with their products. They didn't support it. They also weren't able to give it any resources or time. I agree with clonazepam- I too equate HP with cheap molded plastic. And it's one thing if your products are solid but not very flashy or innovative (think Lenovo) but it's completely another if your products are trash that have zero reliability and are not consumer friendly. Oh and by the way, installing 20 different trial programs and useless applications is NOT consumer friendly, especially when you do stupid stuff like sell laptops running Vista with 1 GB of RAM to unsuspecting consumers along with all the bloatware.
  • -5 Hide
    Anonymous , August 20, 2011 3:11 AM
    "A good read"??? Seriously. Wolfgang is a symbol of typical media F.U.D journalism in technology topics. After having relied on HP enterprise servers and storage for over a decade, your infant dribble is pathetic. No, HP doesn't need to dabble in pathetic consumer crap, but they are rock solid in the enterprise. The problem with so-called "journalists" that write these "hey, I woke up, got a Starbucks, and thought I'd write on the latest tech topic of the day" is they've never spent a day having to provide 101% uptime and it's easy on their consumer device to write whatever drivel spills out of their trap. Useless waste of thought as usual with no benefit to persons actually working IN the tech industry.
  • 4 Hide
    Anonymous , August 20, 2011 3:30 AM
    Great article, balanced and well said. You forget one other thing, not many palm people stuck around following the buyout. And those who did were gone within months. My faith in HP died when Rahul Sood left. Up till that point it was his excitement that really had me interested in the future of HP branded webOS products, but once he was gone, I looked at what was left of "Palm" and it wasn't much.
  • 2 Hide
    jecastej , August 20, 2011 3:44 AM
    I know there would be the "easy opportunity" for some readers to trash the entire analysis and passion in this article for the suspicious reason that Apple is many times mentioned as the company to have in mind. Again that would be very short sighted. But personally, I can't deny I expected more from HP. I believed the year HP took to develop their tablet and the Palm acquisition would be enough to produce maybe the best iPad challenger or even something better, different. And this situation with HP comes to reveal more than three things but I want to point just to 3. Apple has done very well their job with the iPad, even if you can't take any advantage of it or you hate it because its Apple. It is nothing trivial to produce a massive popular computer gadget. Second, HP's own big problems to produce one. My third conclusion is another big denial for many: The desktop PC tower form factor as we came to know it is dying as the massive default computer world wide. HP also announced a spin off of their PC business. What could happen tomorrow with the PC that could regain the concept to a better situation I don't know. Maybe the gamers in general could buy the PC more time in market interest. The hardcore PC users will always be there. I know I will use the tower PC while I find it the best way and economically faceable for me to produce my job.
  • 1 Hide
    maddad , August 20, 2011 3:48 AM
    Well, I ordered the 16gb version @ $99. Hopefully someone will come out with a way to load Android on it. I'll just use it to surf the web and check email when I am out and about.
  • 7 Hide
    legacy7955 , August 20, 2011 4:08 AM
    I definitely disagree about HP small business and consumer OEM PCs. While they aren't flashy or gaming machines they are actually pretty good quality and from my experience have very good reliability. Their tech support is also quite good as is their warranty if you need it.

    I think HP is done as a major force in the computing business if they completely abandon the PSG entirely. It screams FAILURE at the most elemental level.

    I would agree that HP needs to streamline their PC lines and bring the overall hardware quality back to the levels they enjoyed around the late 90s and early 00s.

    They should kill the entry level models and concentrate on mid and higher priced units.

    I've always been a big fan of their products . More worrying is the fact that it seems like US companies are just giving up the PC business without even a fight at all.

    Sorry but this is DEPRESSING TO ME!!!!!!!

    HP PLEASE ....DON'T GIVE UP THE PC BUSINESS!

  • 0 Hide
    Anonymous , August 20, 2011 4:11 AM
    Funny commentary, so true; then I associate HP brand to good laptops and printer, and enterprise stuff, IBM did not throw out core business with Lenovo but HP is doing it.

    My insistence on Windows Mobile or even older Palm OS is purely for one app: TCPMP; threw that out on webOS I pretend Palm does not exist (same goes Windows Phone 7) That surely says what a "platform" is, wreck that and you effectively screw the entire package.
  • 4 Hide
    ravewulf , August 20, 2011 4:34 AM
    I wonder if HP is going the same way as 3DFX
  • -1 Hide
    DjEaZy , August 20, 2011 5:08 AM
    ... two big companies bid for palm because of WebOS: HP and Apple... but they sold to HP because of a matter of principle... the designer of WebOS was a former apple employee... if apple would win the bid, i think the iOS and WebOS together would be a awesome thing... because of apple innovative spirit and skill to proper copy and enhance functions...
  • 1 Hide
    Anonymous , August 20, 2011 5:16 AM
    I wonder how this assessment will change given that HP is giving away the pad for $149 for the 32GB model, flooding the market with it and opening the door for a usable platform?
  • 1 Hide
    LORD_ORION , August 20, 2011 5:18 AM
    That is all fine and dandy, but corporate welfare (the tax payers will foot the bill for your failure through a tax deduction) is ultimately why this product failed.

    They gave up at the 1st sign of adversity and took the tax deal to landfill the product rather than be confident that they could eventually succeed.

    Nobody ever succeeded by giving up immediately, or so I've been taught. Why does this rule not apply to HP? Let alone why are they rewarded with a golden pillow to land on for falling on their ass?

    Ultimately the decision makers will not be punished, only the people who did the actual work.
  • 4 Hide
    Anonymous , August 20, 2011 5:23 AM
    Despite what the current HP CEO thinks, HP actually does have a good presence in the consumer computer market. HP is quite different from IBM which presence trails behind many competitors. Sure the profit margin is not what it is used to be, and PC business is now a mature and stagnant business like car industry is. Nonetheless, a source of profit is still profit. Is HP really bleeding money in this segment? Why give up the leadership position when there is no real reason to? Heck even my company purchase new PC exclusively from HP alone. There is a lot of goodwill there.

    I feel HP once again manages to employ a leader who is too keen on showing that he can make a difference and is willing to risk the whole company future to achieve his own goal. Maybe they should have just employ someone who is more on defense and streamline the business instead of someone who tries to achieve more growth even when there is no sound business plan.
  • 0 Hide
    coletteduke , August 20, 2011 6:02 AM
    great now release the webos installer for ipad please. http://bit.ly/nSJwW1
  • 7 Hide
    mrmike_49 , August 20, 2011 6:02 AM
    fyaskowebOS failed because HP has retards at the helm.


    Yeah, especially their new CEO - he's a software guy, so naturally he's gonna turn HP into a software company - pathetic! It really is the worst of American business (mis)management: management by executive fiat
  • 6 Hide
    jj463rd , August 20, 2011 7:50 AM
    Wow this is mind blowing yet sad news.
    I remember back in the early to mid 1970's
    HP had an awesome line of advanced programmable calculators (almost microcomputers).Easy to write complex programs on.A very compelling well built practical line of products they had back then.I myself owned a HP-67 and a friend of mine had the earlier HP-65.Far more practical,versatile and useful than the clunky big Altair 8800 or the IMSAI 8080 monstrosities.Oh those early big microcomputers were cool though but just impractical.Even Steve Wozniak (I think) of Apple Computer fame worked in HP's programmable calculator division before creating his own Apple I microcomputer.
    They (HP) had developed such a reputation that even NASA astronauts and engineers used their programmable calculators during the late 1960's and the decade of the 1970's.

    So they are even considering abandoning their PC line too?
    Ouch and even mind boggling.I was even considering getting a HP notebook with a AMD A4 Fusion CPU with a very good battery life,decent CPU power,small size that could even be used for light or lower res gaming for around $380.
    I'll have to reconsider my decision if they decide to sell off their PC business.What a sad ending.



  • -3 Hide
    doggrell3000 , August 20, 2011 8:25 AM
    apple , microsoft , google , hp , dell , ibm , and every tablet phone laptop desktop and software big household name which are all worth multi billions of dollars and have fleeced consumers out of every dime they can spare - all have two things in common : they were virtually unknown twenty five years ago and they will be a faint fading memory twenty five years in the future . mark my words .
  • 7 Hide
    Anonymous , August 20, 2011 9:03 AM
    doggrell3000, how can anyone take your word seriously when you are completely incapable of either remembering how long most of the companies you named have been around, or you're completely incapable of such simple arithmetic, or... well, there's nothing redeeming from your post for claims, as the only company you mentioned by name that's not been around over 25 years is Google.

    doggrll3000 will be dead in less than 10 years from a drug overdose - mark my words :D 
  • 10 Hide
    kartu , August 20, 2011 9:27 AM
    You can invent reasons like "lack of innovation" but it's not why it has failed.

    A couple of weeks ago I didn't even check what it does, before ruling it out, when considering what tablet to buy. Yet another web platform, pushed by a single manufacturer who's just trying to gain market share, didn't sound promising at all, I saw this obvious end coming, albeit not so soon.

    And all the blabla about cool platforms, dual/quad core CPUs, gigapuxel cameras with 2mm lens, wake up people. It's all crap. Screen quality, smooth UI (and no, you don't need dual/quadcore for it, just optimized code, not bloated bytecode running in a JVM with no JIT) and battery life is all that one has to care about about these gadgets. Oh, and the fact that you can install applications on it, without needing some greedy bastard's approval.

    And one more thing, pardon if it hurts your feelings, but mobile OS functionality at the moment is VERY VERY VERY BASIC. Even this basic thing is hard for google to keep it up, but only because there are gazillion of hardware configurations to support. There is NOT A SINGLE mobile OS out in the wilds, having more functions than what a group of dozen developers could achieve within 12 month using Linux as a base (for a particular gadget).
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