Google Deal – HP Deal

Hola Todos!

Both HP and Google have been in the news a lot lately. Both also have relatively new CEOs in their respective positions.  I hinted in the Steve Jobs post that the Google-Motorola deal had just as much to do with patents as it did with Mr. Page needing to make a big splash on some strategic issue.  Larry has been relatively quiet since taking over as CEO and Wall Street does not favor quiet CEOs.  Plus, there has to be some pressure within Google to not lose ground in the fastest growing market in tech – mobile computing.  Page and his team know what’s in the pipeline 6 to 9 to 12 months in advance from many of the tablet manufactures because these firms use Android.  Perhaps, they were not impressed.  In the past 2 plus years, there have been a number of comments from the Google executive team hinting displeasure with the integration of their Android software with someone else’s hardware – and it needed to end.

At the same time, HP decided to get out of not only the fastest growing consumer market (mobile computing) but also of one of the largest consumer markets in tech – personal computers.  At first, I was totally baffled why HP would leave both of these markets – “spin them off” or something to that effect.  HP is #1 in market share for consumer PCs!

My first reaction was that HP was pulling an IBM circa late 1990’s.  After all, HP as very successful enterprise (translation: B-to-B) business and they were going to focus their efforts in this area.  If this is the case, they should also get out of the consumer printer business (but this is a very profitable sector so I doubt that would happen).

One of my favorite blogs  – Apple 2.0  – shed some light on HP’s thinking and perhaps their recent actions should have been expected.  The new CEO Leo Apotheker is a former SAP CEO – he does not have a “consumer” bone in his body – he’s all enterprise.  Without any experience or desire to play in consumer markets, this CEO is putting his “stamp” on HP.  Only time with tell it’s the right call or not.

 

Best

Dr. Dan-o

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