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HP buys Palm- Success or Failure?

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There had been much chatter about a possible Palm acquisition- well HP finally pulled the trigger. Dan Formmer argues that it was a bad move- that there is no way to compete with the entrenched trio of Microsoft, Apple & Google. But I'd argue that point- those players have only been entrenched for a year or two.

I think with the manufacturing, and more importantly distribution prowess of HP they could quickly make inroads into many segments. The Compaq iPaq (now HP iPaq) ruled the day in corporate environments and I can see a lot of corporations using a Webos powered HP device instead of the "consumer devices" powered by Google, Apple and increasingly Microsoft. Hospitals & corporations don't need hundreds of thousands of apps- they need a few dozen mission critical ones that are secure and run reliably. HP has had a long time to figure this out. So yes while it's possible HP may never be able to compete on the consumer front I think they may be able to create a great business product.

Why HP Is Buying Palm And Why It Will Fail

Why is HP spending $1.2 billion on Palm?Not just to get into the fast growing smartphone industry, but to end its reliance on Microsoft Windows as the basis for its hardware gadgets.This is an ambitious task, and could obviously have a big payoff if it's successful. HP will invest hundreds of millions of dollars into the project, and will certainly make some noise. But the odds of this working are very low, and HP's plan will probably not be successful.

To be sure, there's always the chance that HP will do something brilliant, and that its phones and tablets will be wonderful devices that are huge hits with consumers. But that's magic that HP has never found in the consumer electronics industry, and Palm hasn't had in years.So the odds are likely that HPs big bet will be a flop, and that it'll have to go crawling back to Windows or Android, whichever is the dominant consumer electronics platform in a few years.

via Why HP Is Buying Palm And Why It Will Fail by Dan Frommer Apr. 28, 2010, 5:05 PM