Monday, September 5, 2011

HP

Reviving the blog after taking the Summer off with this thought.
It's widely known that HP will stop making most hardware. (http://news.cnet.com/8301-1001_3-20094222-92/hp-halts-webos-business-spins-off-pc-unit/)

Although, they may un-retire their notepad now that they think they can actually make a profit, but they have announced that this may be short-lived.

Meanwhile they've been buying software companies. ( For example, Autonomy : http://www.bloomberg.com/news/2011-08-18/hp-said-to-be-near-10-billion-autonomy-takeover-spinoff-of-pc-business.html). In short, they're trying to become IBM. Spin off the PC business, like IBM did to Lenovo, focus on servers and corporate software and support. Make money from consulting.

From a business perspective that makes sense. In fact, it's real winner. But I have to think about HP's origins. In the 1960's it was a small company that built testing hardware for technical applications (oscilloscopes, etc.). One of their engineers decided to invent this thing called a "programmable calculator". The marketing department shot it down -- it could never make money. They cancelled the project. But Mr. Hewlett was an engineer at heart. When he saw it, he loved it and decided that he wanted one. What Mr. Hewlett wanted, Mr. Hewlett got. So, the marketing types rolled their eyes and went along with it, sure they couldn't ever sell more than 2.

Of course, 20 years later, HP was the leading manufacturer of programmable calculators and a multimillion dollar company. Bill Hewlett was right. He was a geek at heart and a bit ahead of his time.

That HP is stepping away from hardware implies to me that the geeks have lost. The accountants are twitting their pencils and deciding that there's more money in software and consulting than hardware. And they're right. I agree. But I'm sad.

I think it speaks of a shift in the industry that saddens me. The days when IT folks could just build cool stuff and figure out how to make money later are mostly gone. (well, Google may be the last one standing, but I think they've even shifted from an "innovative" approach to a "profit" approach about 70% of the time now).

Hopefully there will still be opportunities to make a lot of money doing something that's "just cool", rather than something that balances the cost-benefit sheets.

We'll see.
--kevin

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