HP: ‘Not Leaving Tab Market’ …Just Web OS, As Unveils New PC

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Don’t write HP tabs off just yet says former head of Palm. The TouchPad maker announced last week it was planning to spin-off or sell its personal systems group (PSG) PC business which sells notebooks, tablets and smartphones, and discontinue sales of its WebOS-based devices.

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“What we said was we’d stop manufacturing Web OS devices,” PSG executive vice president Todd Bradley told CNBC yesterday.


“We’re not getting out of the tablet market,” he insisted. 
Bradley, head of smartphone maker Palm when it was sold to HP for $1.2 billion just last year, says he will stay at helm as long as it was still ran from Palo Alto. 

This shock announcement comes as the No.1 PC maker globally launched a new HP Compaq 8200 Elite All-in-One Business Desktop on Monday, that promises 40% higher performance than other computers.

Read New HP Conference PC, 40% Faster Than Most


But the Palo Alto computer king has not yet made a decision on what to do with its troubled PSG business, Bradley says, but is “looking at a variety of strategic alternatives to ownership, from spin-off to nothing.” 

This appears to be a watered down version of the same company that last week appeared to sound the death knell for its hardware business, and its intention to takeover UK software giant Autonomy for around $11 billion, saying this was where the industry was headed and would be better for the bottom line. 


Revenue for the personal system group (PSG) in Q3 this year fell to $9.5 billion from $9.9bn in 2010, while income from tech services was almost the same at $9.1bn for the period. 

 “HP will discontinue operations for webOS devices, specifically the TouchPad and webOS phones,” the company said last Friday in an earnings statement.  
This comes as the traditional PC business is crumbling, with falling margins as competition from iPad and Android tablets intensifies. 
 The tab device, released earlier this year had “not met internal milestones and financial targets,” the company said. 

“HP will continue to explore options to optimize the value of webOS software going forward.”

 
Following this, Harvey Norman as well as retailers in US, UK and New Zealand began selling HP TouchPad at knock down price of $99 (AU$98 at Harvey’s). 

However, Bradley insists HP’s computer business is a-growing, branding rumours of takeovers by everyone from Lenovo to Samsung as “medicore at best” and wide of the mark. 

But he did confirm, the company has had interest from “a number of large parties” since last week, hailing Palm’s self made WebOS platform used on HP smartphones and tabs as a “strategically important asset.” 

“We are very aggressively growing the PC business. We are looking at how to position the PC business for growth,” he said. 

However, an internal review of the PC business, which is still profitable, will take place over the next 8-12 weeks. 

Company officials will “sit down with the board, take them through the results and I’m sure they will make the best decision for shareholders.”

“My intent is to work through this process with HP. At the time whatever action is determined, my intent is to lead that. If it stays with HP I will continue to run it.”

HP shares closed 3.6% higher on US markets yesterday after plummeting 20% on Friday. 

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