Isn't that a big part of the reason they fired Leo Apotheker a few years ago and replaced him with Meg Whitman who said the company was stronger with both groups attached?
Leo wanted to turn HP into a software company and dump the other parts of their business on the open market. He dropped HP's value in half during his very short term. Additionally, he reduced the perceived value of their PC business, which was already shrinking due to the PC market's fall, by offering to sell it publicly without any hope of a buyer, leading to the image of a division that "nobody wants". That perception is not exactly accurate as its PC business is doing quite well, e.g. http://www.itnews.com/financial-results/82832/hp-r...
Actually, if you read that article, it's clear that they didn't think that the growth would be repeated. More importantly, the profits from the entire company were down a large 29%. It's even possible that the PC division, which itself is operating at a loss, contributed an outsized portion of that loss as sales increased.
To be honest this looks like a cop-out from whitman. She's taking the easily manageable and already profitable enterprise, market while spinning off the highly-competitive and low margin consumer pc biz to be someone else's problem. Theres just no way HP is going to make inroads in the phone business ever. I wouldn't buy an HP phone simply because i associate HP with cheap desktops, bloated print drivers and crap tech support.....even if the phone was the best one out there. Shes sitting back a collecting a big fat paycheck here, and HP is going to continue its slow march to death.
There is a very good reason HP is doing this. The HP inc. Group is a dying and diminishing business sector while the enterprise company is much more re focused.on sustainable and growing segments.
These companies won't be completely independent. Whitman will be CEO of the enterprise company, but she will also be chairwoman of Hp inc. I would imagine that even after the split into two "independent" companies, they don't want one to move against the other. So, with this arrangement, they will still be joined at the head. I wonder what will happen with the two boards. Will many of the same people be on both?
These are serious questions, and they need to be answered, sooner rather than later.
It seemed obvious that when Whitman put printing and pc's in the same basket, that something was going to be done like this. I'm assuming that they were just waiting for the flack from the earlier deal to die down.
One thing not mentioned here and it is elsewhere is the layoffs. "HP also said its layoffs, which are already in full swing, will affect 55,000 people by the time they're done. "
So I wonder if the business pc's (Prodesk,EliteDesk,Probooks,Elitebooks) will suffer in quality at all as I am assuming these will be pushed into the HP Inc's pc business, as I do not see them staying with the enterprise group.
As an hp reseller I wonder how this will transition will be like
So basically an "ink" division that sells printers and PCs to individuals as loss leaders to suck up ink, and an "inc" division to sell non-ink stuff to biz. Bet they paid a fortune to MBAs to come up with that gem.
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icrf - Monday, October 6, 2014 - link
Isn't that a big part of the reason they fired Leo Apotheker a few years ago and replaced him with Meg Whitman who said the company was stronger with both groups attached?Sivar - Monday, October 6, 2014 - link
Leo wanted to turn HP into a software company and dump the other parts of their business on the open market. He dropped HP's value in half during his very short term. Additionally, he reduced the perceived value of their PC business, which was already shrinking due to the PC market's fall, by offering to sell it publicly without any hope of a buyer, leading to the image of a division that "nobody wants". That perception is not exactly accurate as its PC business is doing quite well, e.g. http://www.itnews.com/financial-results/82832/hp-r...melgross - Monday, October 6, 2014 - link
Actually, if you read that article, it's clear that they didn't think that the growth would be repeated. More importantly, the profits from the entire company were down a large 29%. It's even possible that the PC division, which itself is operating at a loss, contributed an outsized portion of that loss as sales increased.Healthy? Not hardly.
modulusshift - Monday, October 6, 2014 - link
Yeah, he just didn't have to call attention to it. I'm still upset he killed webOS, though.dsumanik - Tuesday, October 14, 2014 - link
To be honest this looks like a cop-out from whitman. She's taking the easily manageable and already profitable enterprise, market while spinning off the highly-competitive and low margin consumer pc biz to be someone else's problem. Theres just no way HP is going to make inroads in the phone business ever. I wouldn't buy an HP phone simply because i associate HP with cheap desktops, bloated print drivers and crap tech support.....even if the phone was the best one out there. Shes sitting back a collecting a big fat paycheck here, and HP is going to continue its slow march to death.HardwareDufus - Monday, October 6, 2014 - link
So basically Compaq computer and HP Enterprise. That would be alot less confusing for everyone.nathanddrews - Monday, October 6, 2014 - link
I have to wonder if HP Inc. will continue to market the Compaq branding. Kill off the name once and for all?gostan - Monday, October 6, 2014 - link
Its Compaq computer and EDS.AllYourBaseAreBelong2Us - Monday, October 6, 2014 - link
No, it is HP Ink and HP Clouderrorr - Monday, October 6, 2014 - link
There is a very good reason HP is doing this. The HP inc. Group is a dying and diminishing business sector while the enterprise company is much more re focused.on sustainable and growing segments.melgross - Monday, October 6, 2014 - link
These companies won't be completely independent. Whitman will be CEO of the enterprise company, but she will also be chairwoman of Hp inc. I would imagine that even after the split into two "independent" companies, they don't want one to move against the other. So, with this arrangement, they will still be joined at the head. I wonder what will happen with the two boards. Will many of the same people be on both?These are serious questions, and they need to be answered, sooner rather than later.
It seemed obvious that when Whitman put printing and pc's in the same basket, that something was going to be done like this. I'm assuming that they were just waiting for the flack from the earlier deal to die down.
sumludus - Monday, October 6, 2014 - link
I'm curious if HP Labs will be completely transferred to enterprise HP, or if they're going to have to split resources with the consumer HP.Dahak - Monday, October 6, 2014 - link
One thing not mentioned here and it is elsewhere is the layoffs."HP also said its layoffs, which are already in full swing, will affect 55,000 people by the time they're done. "
So I wonder if the business pc's (Prodesk,EliteDesk,Probooks,Elitebooks) will suffer in quality at all as I am assuming these will be pushed into the HP Inc's pc business, as I do not see them staying with the enterprise group.
As an hp reseller I wonder how this will transition will be like
melgross - Monday, October 6, 2014 - link
Confused, frustrating, drawn out and demoralizing. In other words, business as usual when something such as this occurs.Kevin G - Monday, October 6, 2014 - link
Minor quibble in the article: HP didn't directly acquire DEC. Rather DEC was acquired by Compaq who a few years later was gobbled up by HP.isa - Monday, October 6, 2014 - link
So basically an "ink" division that sells printers and PCs to individuals as loss leaders to suck up ink, and an "inc" division to sell non-ink stuff to biz. Bet they paid a fortune to MBAs to come up with that gem.