HP Axes WebOS Development, Tablets and Smartphones Product Lines

HP Admits: Acquisition of Palm Did Not Bring Fruits

by Anton Shilov
08/18/2011 | 07:15 PM

HP said on Thursday that it would can the development of its webOS operating system and devices and will shut down the appropriate division. The world's biggest IT company said that the webOS product line did not meet its expectations and it was looking forward to explore options how to capitalize on the webOS.


HP will discontinue operations for webOS devices, specifically the TouchPad and webOS smartphones, the company said. HP indicated that the devices have not met internal milestones and financial targets, which means that the firm neither sold enough tablets and handsets and thus lost money. HP will continue to explore options "to optimize the value of webOS software going forward", it was indicated.


The Palo Alto, California-based HP got webOS along with the acquisition of Palm in early 2010 for $1.2 billion. After the takeover, the company dropped development of Google Android-based gadgets and said it would focus only on webOS. Later on, the firm promised to install the webOS onto devices other than tablets or smartphones, including printers, and even onto PCs as the secondary OS. By shutting down the webOS business, HP admits indirectly admits that it does not want to compete with consumer-oriented companies in the rapidly expanding market of mobile communication devices.

"HP, through its plans to shutter webOS and seek alternatives for its PC business, is limiting its exposure to the consumer hardware market and, instead, going all-in on a strategy of increasing its revenue and margins with an enterprise-focused bundle of software, services, servers and storage. Removing all or part of its low-margin consumer PC business and the expense of fighting its way into the mobile and tablet markets with a fourth offering (after Apple, Google, and Microsoft) will improve HPs margins in the short term," said Beau Skonieczny, research analyst of computing practice at Technology Business Research.

At present it is completely unclear what happens to the webOS in particular and Palm business unit in general. In case HP wants to completely withdraw from the hardware business, it will have to sell Palm business unit along with webOS as nobody will acquire the former without the latter and it will be hard for HP to develop a competitive mobile eco-system itself. There may be a number of bidders for the Palm business unit, including HTC, Huawei, Google, Microsoft, ZTE and many others.

The drop of webOS development by HP, which means that essentially the operating system will never be used in its current form, is just yet another collapse of a mobile platform in the recent years. For many reasons, this solidifies positions of Apple iOS and Google Android as the operating systems to consider when developing mobile applications or getting new devices.

 Neither software developers or customers like when their applications become obsolete when their creators cease to support or develop them. Nokia used to have trustworthy Symbian, which it buried this February; Microsoft used to have Windows Mobile platform, which it killed by releasing incompatible Windows Phone; many other mobile software platforms were also canned in the recent years. As a result, third-party software makers will simply cease to invest into emerging operating systems and will only develop for stable platforms like iOS or Android, which greatly limits possibilities of new operating systems to emerge.