HP Buys Palm to Slay Apple: Will It Work?

It all comes down to HP's global reach

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Hewlett-Packard has acquired Palm for $1.2 billion and the impact on the smart-phone wars could be far-reaching. HP now owns Palm's innovative mobile operating system, webOS, which could run HP's tablets and smart phones. The company has its sights on Apple's growing mobile-device hegemony. Will this new acquisition give them a leg up?

  • This Is All About Palm's Mobile Operating System, says HP in a statement: "If there is only one reason for HP to acquire Palm, it is webOS and its potential...The user experience of webOS rivals -- and in some cases exceeds -- that of the iPhone in terms of fluidity and consistency. This is what HP wants. HP reiterated the size of the global smartphone market repeatedly during its call and the company feels strongly that this is just the beginning. What HP is able to embrace with Palm is the ability to have a seamlessly integrated user experience that extend across devices. This includes smartphones, tablets or slate PCs, and maybe even netbooks."
  • What a Great Partnership, marvels Carmi Levy at Beta News: "The two companies complement each other rather nicely. HP gets Palm's innovative mobile operating system, webOS, a stable of well-regarded mobile handsets, and a treasure trove of patents. Palm gains access to HP's prodigious marketing muscle and global reach. It's that global reach that not even Apple can compete with, and could seriously rewrite how and where mobile devices are sold."
  • Don't Get Too Excited, writes Jon Stokes at Ars Technica: "Clearly, neither HP nor Palm have a track record of producing successful smartphone designs in recent years, and it's not clear that the two together will be able to do what neither could do alone. And on top of the smoking wreckage of the two companies' smartphone efforts, HP plans to build a base from which to attack a whole new vertical (i.e., tablets). So while it's a lot of fun to spin out the possibilities of what an HP/Palm marriage could produce, the reality is that neither company has shown that it can actually execute on any of this stuff."
  • A Challenge to Apple? I Don't Think So, writes Tim Bajarin at Creative Strategies: "Apple did not just come out with a new smart phone. They delivered a complete solution that included hardware, software, and services. More importantly, they controlled the complete customer experience. This is very much at the heart of why Apple is so successful with the iPhone."
  • HP Needs Content, writes Noah Elkin at eMarketer: "Yes, HP now has hardware and software expertise under one roof, and yes, there are personnel synergies (Palm alumni in HP's Personal Systems Group), but hardware and software are still just two sides of the mobile triangle. The missing piece is content, and that's a key part of what generates Apple's appeal."
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