HP announces major changes for Q4 2011

Last week Hewlett-Packard shocked the business world with its plans for extreme changes to the company.  

Change # 1: HP announced the discontinuation of its tablet and smartphone lines including the HP Touchpad, launched less than two months ago. HP has also put their tablet and smartphone mobile operating system webOS on hold until a final decision is reached. Only a year ago HP acquired company Palm to take over this mobile operating system.

Change # 2: HP confirmed that it will be acquiring UK software firm Autonomy for $10.3 billion dollars with the deal to close by the end of this year.

Change # 3: HP announced that it is considering the spin-off of its Personal Systems Group division.

These coinciding announcements have sparked a myriad of rumors. The most conspicuous assumption floating around is that HP will stop producing hardware altogether, not just tablets and smartphones but PCs as well: very similar to IBM’s 2005 maneuver of selling their PC division to Lenovo. But HP, who famously merged with Compaq in 2002 to solidify itself as a major player in the computer world for the entirety of the last decade, claims that it will not be giving up its PC business. Senior Vice President and General Manager of Personal Systems Group Americas Division Stephen DiFranco stated that the HP board had come to the decision to “evaluate strategic alternatives for the Personal Systems Group business” and that the recent press releases are “not an announcement of a shutdown of HP’s PC business.”

Concerning the Touchpad, HP has promised to honor product warranties as well as continue to evolve, update and support webOS. However there is speculation that HP will sell webOS in the future as well, which only reinforces the notion that HP is pulling away from all personal computers, mobile and on-premise, and changing focus to business software and cloud computing.