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Thursday, 13 October 2011 09:37

HP rethinks selling PC dvision

Written by Nick Farell



Better off keeping it for now


Papers presented to the maker of expensive printer ink, HP suggest that spinning off or flogging the outfits PC devision is silly.

According to the Wall Street Journal, papers that have crossed HP's board and Meg Whitman's desk have indicated that it would insane to lose a a  division responsible for 29 per cent of HP's revenue last quarter. The analyses  suggests the company is better off keeping the division, which contributed $40.1 billion in revenue and $2 billion in operating profit in H-P's last full fiscal year.

Apparently it goes well beyond margins. Separating the PC division would significantly diminish H-P's buying power with component makers because HP would lose economies of scale. HP's supply chain would be gutted and it would lose profit margins on some products. All seems obvious, but apparently was not thought of by former CEO Leo Apotheker who was a software rather than a hardware sort of bloke. Supply chains and margins are usually a problem that other CEO's face, but he never did.

The question is why did HP push through with part of Apotheker's cunning plan to turn HP into a bigger SAP by buying British software company Autonomy? In short they just paid $10.2 billion for something they probably no longer need. Analysts are starting to think that HP's CEO's are never really the problem, but it is its board of directors, which are increasingly starting to look like a Frank Oz creation.

Word on the street is that some shareholders are starting to sharpen their scythes and it will be board members they want to to remove.


http://online.wsj.com/article/SB10001424052970203499704576625434293946542.html?mod=WSJ_Tech_LEADTop

Nick Farell

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Comments  

 
+4 #1 Jigar 2011-10-13 10:08
Quote:
Word on the street is that some shareholders are starting to sharpen their scythes and it will be board members they want to to remove


That would be the wise move.
 
 
+1 #2 Peter Ong 2011-10-13 13:21
I used to know HP's directors good at spending unwisely ... since when they develop 'flip-flopped' behavior?
 
 
0 #3 larkforsure 2011-10-13 18:15
[ SOS ] Complaint with Human Rights Violations by IBM China on Centennial

Please Google:

Tragedy of Labor Rights Repression in IBM China
or
How Much IBM Can Get Away with is the Responsibility of the Media
or
IBM detained mother of ex-employee on the day of centennial
 
 
+2 #4 123s 2011-10-13 18:30
Quoting larkforsure:
[ SOS ] Complaint with Human Rights Violations by IBM China on Centennial

Please Google:

Tragedy of Labor Rights Repression in IBM China
or
How Much IBM Can Get Away with is the Responsibility of the Media
or
IBM detained mother of ex-employee on the day of centennial
There is any huge company that doesnt shit on human rights :o ?
 

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