HP buys beleaguered Palm: Everyone’s a loser but Apple

invisibleSHIELD case for iPad“Not even a year ago Palm and its chief investor, Elevation Partners, confidently spun a yarn about the pioneering company’s long-term plan. The smartphone market was nascent. It was going to be massive. Even a small share of such a big market would lead to huge success for a smaller player like Palm,” Adam Lashinsky writes for Fortune. “Unfortunately for Palm, while the first two legs of its narrative stool are correct, the third isn’t, which is why Palm folded Wednesday with its fire-sale purchase by Hewlett-Packard.”

Let this be a cautionary tale for all sorts of reasons:

• Managerial hubris. The bitter pill for Rubinstein will be that he wasn’t able to accomplish on his own what he was under the tutelage of Steve Jobs. There is no shame in this. Almost no one has accomplished what Steve Jobs has. To try was valiant. To pull it off proved another story.
• Investor hubris.
• No company can do everything: By buying Palm, HP gets very good technology, some outstanding people, and existing carrier contracts. HP in turn will be able to throw its considerable marketing and purchasing power behind Palm’s phones. HP is years behind Apple, though. Apple, again, is the sole unconditional winner. At least for now.

Full article here.

MacDailyNews Take: “HP’s acquisition of Palm means that not only is HP sick and tired of being stuck with and dependent upon perpetual laggard Microsoft, but, more importantly, yet another smartphone/slate PC OS will live to confuse the market. This will significantly benefit the one company that has repeatedly proven its ability to distinguish itself above all others: Apple. The more confused the marketplace, the faster customers will flock to Apple’s trusted brand and quality products.” – MacDailyNews Take, April 28, 2010

[Thanks to MacDailyNews Reader “Robert S.” for the heads up.]


  1. I don’t think piling shit on top of shit is going to make anything better. And trust me they both have a lot of shit out there just making it stink of shit even. The amount of shit might be cut in half(optimistically) but they are now bigger piles of shit.

  2. Actually, this could turn out to be a very profitable. I don’t think HP will try to build their ‘sandbox’ to compete with Apple in the consumer space, but could use it to compete with RIM in the enterprise space.

  3. If HP tries to compete in the smartphone market, they will fail… and fail miserably. BUT…. they could be moderately successful with this if they use the platform to make a relatively simple cellphone that does the basics, does them very well, and doesn’t require a data plan. As much as I love my iPhone, I’d drop it in a heartbeat for a decent basic phone that I don’t have to get a data plan for. Give me something that I can sync at home with my iCal, Address Book, music, and a couple other necessities, and can use a counterpart to those easily on the phone, then count me in.

  4. It’s not clear that HP will want to or try to compete directly against Apple. But like others have said, this is more likely about MS. Dell is going with Android for mobile. Now HP is probably ditching MS on these platforms.

    I’m sure MS is in denial, but this is bad news for them. It’s a race for 2nd and MS just lost their best partner.

  5. The big question is can HP actually develop WebOS into something people want to use. HP has never been strong in software development. If WebOS stays stagnant, then HP just flushed $1.2 billion.

    One thing HP can do right away is improve the quality of Palm’s hardware and marketing. One of the huge mistakes Palm made with the Pre was the marketing campaign and tying the Pre to an exclusive with Sprint. Palm should have done everything in its power to get the Pre released on Verizon right away to cater to people who wanted iPhones but couldn’t or wouldn’t use ATT.

    Plus, those commercials with the ghostly white woman were just plain creepy. They sure didn’t make me want to check out the Pre.

    HP is WAY behind Apple, but WebOS could give HP a shortcut into a new tablet OS to compete with the iPad. It certainly would be better than trying to stuff Windows 7 in a tablet and hope it booted in under 2 minutes.

  6. But it can play Pandora while R2 surfs the web for Porn and go poopee at the same time. How can Palm fail with such amazing technology acknowledge by R2? ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  7. The best thing they can do is make a webOS tablet. It could be the closest anyone can come to the ipad which will put them ahead of all the other wannabe ipad makers.

  8. Even funnier than a fragmented market guaranteeing Apple’s success, is that the people buying into this mess (and creating this division), the rabid ‘i hAtorZ teH aPpLzes” crowd, they’re the very ones catapulting Apple front and center to the winners circle.

    Hate makes you stupid, and I’m happy watching the lot of you eat crow.

  9. I think his is a very smart move by HP. Palm has a pretty good OS which was let down by cheap and plasticky hardware. HP can make some pretty good, robust and quality feeling hardware.

    Good OS, good phone = good product.

    It wont kill the iPhone, that’s not going to happen for some time yet, but it gives HP control over their own mobile OS. Which should only have positive effects on their business as we move into the new age of ultra mobile computing.

    I see it as being good for HP, it saves Palm and it’s good for Apple too. Strong and diverse competition will keep them focused on staying ahead of the game.

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