HP: A new
Slate in PC market
Company remains in consumer PC market and
launches the new tablet just months after it dumps TouchPad
HP has decided to retain its PC
division just months after announcing it was looking for “strategic
alternatives” for the consumer side of its computer business. Having previously
called time on its TouchPad, the company has also launched a new tablet.
Meg Whitman, HP’s president and CEO,
said it is right for customers and partners, right for shareholders, and right
for employees” that its personal systems group (PSG) stays with the company.
“Keeping pgs within HP is right. HP
objectively evaluated the strategic, financial and operational impact of
spinning off p5g. HP is committed to PSG, and together we are stronger,” she
said.
Former CEO Leo Apotheker revealed that
HP was discontinuing the touch pad and exploring the possible spin-off or sale
of PSG in august, however, following a strategic review under Whitman, who was
appointed as Apotheker’s successor in September, HP decided to keep the group.
PSG is considered to be a key component of its efforts to create long-term
relationships with consumers, including businesses.
Tony Prophet, senior vice-president of
operations at PSG, said spinning off the unit would have cost HP $1.5bn. “As
the analysis unfolded, it became clear the costs were more significant than any
benefit,” he said.
A wise decision?
The original decision to sell or spin off
the division was also criticised by analysts, who said the PC business
contributed to the company’s bottom line arid added purchasing power for
enterprise hardware partners, such customers wanted the company to retain the PC
unit so they could purchase hardware, software and services from one entity.
Meanwhile, HP was losing business to
competitors such as dell, which were preying on the uncertainty around its
business unit to gain new customers.
However, other analysts said the PC
business had to be the first domino to fall if HP was to improve its profit
margins. With PC shipments dropping and the company lacking a clear mobile
strategy, it would make sense for HP to refocus its attention on high-margin
enterprise businesses - much like IBM did when it sold its PC unit to Lenovo in
2005.
Slate 2
HP has also unveiled another tablet PC,
the Slate 2, which has an 8.9in capacitive touchscreen. Unlike the fallen TouchPad,
the Slate 2 runs Windows 7 home premium rather than the webOS mobile platform
and is aimed at businesses rather than consumers.
The device, an update to the Slate 500
released in 2010, runs an Intel Atom Z670 processor. There’s 32GB of storage
built in, and Wi-Fi connectivity as standard. Much like traditional desktop and
laptop PCs, the Slate 2 can run custom applications written for x86 processors
and the Windows OS.
HP said the Slate 2 can be used to
access corporate documents or take notes through stylus input, with an optional
external keyboard, the device can also double up as a PC.
The Slate 2 was available only in the
US at press time, where it costs $699. It’s expected to be made available
worldwide in the near future, but UK pricing has yet to be revealed.
HP says it will continue to produce
the Slate 2 Windows 7 tablet for enterprise customers, and will also develop a
tablet running Windows 8.
“We are certainly going to be there
with Windows 8,” Whitman said.
