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Why Does HP Want Palm?

April 28, 2010 18:00:46.677

I can't figure this one out:

HP and Palm, Inc. (NASDAQ: PALM) today announced that they have entered into a definitive agreement under which HP will purchase Palm, a provider of smartphones powered by the Palm webOS mobile operating system, at a price of $5.70 per share of Palm common stock in cash or an enterprise value of approximately $1.2 billion. The transaction has been approved by the HP and Palm boards of directors.

Why? What on earth is HP going to do with a failing phone business? Didn't they learn anything from the Compaq deal?

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posted by James Robertson


Re: Why Does HP Want Palm?

[anonymous] April 28, 2010 18:32:58.166

Someone said, oh think about replacing your printer control panel with a surface mounted Palm device. Think about allowing people to build WebOS apps that run on your printer.

Why they wouldn't jump into Droids for that, no idea. But maybe they want to run the Palm OS store for printers/scanners/cameras

Right don't forget cameras in this either...

Why *Wouldn't HP Want Palm?

[W^L+] April 29, 2010 18:39:28.879

With more resources, Palm just may surprise you. Their WebOS is wonderful to use.

My concern is more whether they follow HP's practice of garbage hardware (and my Palm Pre is wonderful, but there are a number of areas where the hardware should have been better). Both at home and at work, I've noticed that HP hardware seems to be quick to fail, especially the screens.

Reasons to want Palm:

WebOS -- besides being one of the best mobile operating systems out there, it means they get a good reason not to hang their mobile hopes on WinCE / WinPhone 7.

Patent portfolio -- I think software patents are patently stupid, but big companies love the "p-word" as a way to eliminate competition.

Incidentally, many of the people whom I've showed my Pre have wound up getting the Pre, including a few former iPhone owners.

Dark clouds:

HP's hardware quality went south around the time they first made their computers available at that big blue discount store. At a time when Palm really needs to beef up its hardware to the same level as its software, this could be a problem.

HP's history of privacy invasion could cause people to balk at having a Palm profile (where backup data is stored). Now, HP spied on members of its board, not the public, but they really need to be rigid about protecting the privacy of those who use their products.

Palm has needed money. If HP isn't willing to put up some money, they won't be able to accelerate their activities and put their products back on everyone's radar.

HP's history of apparent neglect in regard to HP-UX, Tru-64. This cannot be a "milk profits while sales decline" investment. This has to be an actively developed business, or Android (and maybe even Meego) will come along and eat it up.

HP's PC business and its dependence on Microsoft Windows is probably already tempting Redmondites to think of schemes to raise their WinPhone 7 product sales.

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