HP to Split into Two Companies

CommanderFrank

Cat Can't Scratch It
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The Wall Street Journal reports that Hewlett-Packard plans to split the company, making separate divisions as a PC and Printer company and the other as an Enterprise Computing and Services company. Meg Whitman stays on as the CEO of the Enterprise side of the equation and Dion Weisler will take over as CEO of the PC/Printer division. A full announcement is expected on Monday.

HP is perhaps the seminal Silicon Valley company, with a rich history of computing breakthroughs and technology leadership since it was founded in 1939.
 
Not too surprised to hear this.
The "consumer" end of HP printers have entered the realm of throw away like Lexmarks did years ago.
The upper end printers are still expensive and descent quality but they have a lot of competition now from other manufacturers.
I would stop selling the low end printer and concentrate on business class models that are not designed to be tossed out after a year or so.
 
You would think they'd keep the companies together, so when the pc/printer side shows losses they can write those off against more profitable parts of the business (assuming those exist)
 
Not too surprised to hear this.
The "consumer" end of HP printers have entered the realm of throw away like Lexmarks did years ago.
The upper end printers are still expensive and descent quality but they have a lot of competition now from other manufacturers.
I would stop selling the low end printer and concentrate on business class models that are not designed to be tossed out after a year or so.

All printers will be handled by the "PC & Printer" company, even the "Enterprise" level printers. The other company will be focused on HP's server/storage/switching business. This really sounds like a good move to me since they're quite disparate product lines. HP's SAN line in particular has been getting buried of late by more aggressive newcomers like Nimble and Netapp. HP's getting ready to release a new all flash array soon in an effort to compete.

This sounds like a great move for them.
 
Imho I never considered HP to be a very ethical company. Their policies have screwed me over several times. And the regularly get bad press flack for the crap they pull.
 
how many splits have they done already?

agilent anyone?
 
The consumer side will suck. The enterprise side will do excellent. Sounds like they want to have a loss with the consumer side as a writeoff or something (not sure how that works). Enterprise HP stuff is excellent. Printers, servers, switches - excellent stuff. Consumer stuff - printers, laptops, etc. - bleh. It works for a while...
 
Seriously, they should just go out of business. Let better companies like Asus thrive.
 
Sooooo, instead of having one junk company they will have two junk companies.........Smart.
 
Seriously, they should just go out of business. Let better companies like Asus thrive.

What is your mailing address so I can overnight you a clue?

Asus founded in 1989 a Taiwanese company compared to HP who has been in business for 80 years?

Most companies the age and size of HP are or have had similar struggles.
HP designed and built the lab equipment that became the world standards. This was their core business but they diversified into printers, PCs etc. Public companies like this really STRUGGLE when times change because they have a clueless board of directors and they hire even more clueless CEOs that often drive the companys into the ground. (Carly Fiorina)
HP May eventually exit the PC business and stick to it's core business. Many American companies have given up the "consumer" markets to the Chinese, HP my follow.
 
I am sure that through some creative accounting they will take advantage of any available tax breaks resulting from the split. Once the two companies are separate, they will let the personal computing division (which operates on slim margins and volume) continue to spiral into oblivion, until someone else comes along to gobble them up in a semi-hostile takeover kind of situation. Meanwhile, the business division (where they make their money) is free of the anchor that is HP's current consumer products division.

That is my prediction at least.
 
What is your mailing address so I can overnight you a clue?

Asus founded in 1989 a Taiwanese company compared to HP who has been in business for 80 years?

Most companies the age and size of HP are or have had similar struggles.
HP designed and built the lab equipment that became the world standards. This was their core business but they diversified into printers, PCs etc. Public companies like this really STRUGGLE when times change because they have a clueless board of directors and they hire even more clueless CEOs that often drive the companys into the ground. (Carly Fiorina)
HP May eventually exit the PC business and stick to it's core business. Many American companies have given up the "consumer" markets to the Chinese, HP my follow.

HP might have been around for 80 years, but that doesn't mean it's relevant or a leader. I'm sure that it's lab equipment was second to none, but since it spun off Agilent 15 years ago it hasn't been making them anymore. Sure they diversified into PC's and printers, etc, but it's hard to make money from the PC business these days and the printer business is starting to shrink. Yes, big companies often struggle in times of transition, but they also die more often than you'd think.

In fact your remark about clueless boards is spot on, but that kind of goes to what Evil was saying. If the leadership can't get it's act together, HP will eventually die a long, slow death. Look at Sears and Radio Shack, two famous brands that are at death's door right now thanks to DECADES of mismanagement. It didn't happen overnight, but first they became irrelevant quite a while ago and then slowly faded.

And spinning off assets to focus on the "core" business is a classic MBA-itis symptom that translates into "the market has changed, we're no longer leaders and we have absolutely no idea what to do now." Sometimes spinning off assets might be needed, don't get me wrong, but the term "focus on the core business/market" often signals the beginning of the end of the company.
 
HP has been cutting US jobs like crazy for the past few years and either moving those jobs offshore, or piling the duties upon remain employees. Asus and Foxconn are the two largest manufacturers that HP contracts with to build just about everything in Mexico and China (just as all large OEMs do).

By spinning off the PC and Printer segments into a separate company, they are poised to make that entity profitable again by utilizing the cheap labor in the countries where their products are manufactured.

All kinds of US jobs such as supply chain, order processing, billing, account management, etc have largely been moved to Juarez and Guadalajara...even personnel in charge of government agency and military accounts.

As for the remaining US locations, they are in the process of closing them down and consolidating employees in Texas...those employees that do not wish to or are not able to relocate are getting their pink slips.

I feel safe in assuming that the consolidated employees now in Texas will be let go over the next 5-10 years as those jobs are moved outside of our borders, as well.

That being said, if I worked in a large enterprise IT Department (and I do), I would only buy HP desktops and laptops, because their business support is still quite fantastic. I'm Dell and HP warranty on-site certified, and HP is the best to work with in getting warranty replacement parts.
 
One to make crap and the other to make shit..
Makes perfect sense..
 
What is your mailing address so I can overnight you a clue?

Asus founded in 1989 a Taiwanese company compared to HP who has been in business for 80 years?

Most companies the age and size of HP are or have had similar struggles.
HP designed and built the lab equipment that became the world standards. This was their core business but they diversified into printers, PCs etc. Public companies like this really STRUGGLE when times change because they have a clueless board of directors and they hire even more clueless CEOs that often drive the companys into the ground. (Carly Fiorina)
HP May eventually exit the PC business and stick to it's core business. Many American companies have given up the "consumer" markets to the Chinese, HP my follow.

You know why this is stupid? Because what do you think the Chinese companies are going to do once they conquer consumer markets? Sit on their asses? No they are then going to slaughter them in the enterprise space as well. And then neither company will be there. The reality is the US and European big companies sold out ALL control they had to the Asian suppliers and now they are paying the price for that. Because once an Asian supplier gets into the retail space they sure as hell aren't giving the high quality stuff to the US competitor.

The reality is these companies need a swift kick in the nuts of the executives who cannot figure this out. And complete board replacements should be carried out to hold them responsible. Then when they realize the shareholders will not keep putting up with hiding the problem they can get back to competing.

HP has been doing nothing but copying apple with lower quality junk for the last half a decade or more. It's pathetic.
 
HP has been running as many different companies for quite a while. You can bet that nothing is going to be different when PPS changes its name.
 
Its a way for a CEO to get rid of the the non-profitable en devours without shutting them down yourself which looks bad. The new company's stock shoots up, CEO doesn't get a black mark for closing things down, CEO doesn't take PR flak for lost jobs, etc.

This works really well until the company runs out of shit ot jettison and its no longer diverse enough to cope with changing marketplaces.
 
It really is not a bad idea. HP business products are way better than their consumer and the one should not be hobbled by the other.
 
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