Palo Alto, CA-based tech giant
Hewlett-Packard Co.
(
HPQ
) is about to make another experiment with its not-so-profitable
mobile operating system platform, webOS. H-P inherited the platform
from Palm Inc.,which was acquired last year.
In its Strategy Summit held in San Francisco earlier this year,
H-P's then chief executive officer (
CEO
) Leo Apotheker announced the intention to develop the webOS
platform into a leading connectivity platform. The tech chief also
announced plans to launch the TouchPad tablet and new smartphones
on webOS.
But the TouchPad tablet and the smartphone failed to carve a
niche in a market dominated by
Apple Inc.
's (
AAPL
) iPad and iPhone as well as
Google Inc.
's (
GOOG
) Android-based devices. The devices did not reach internal
milestones or financial targets. Actually, the webOS platform
itself lagged far behind Apple's iOS and Google's Android operating
system platforms. And the CEO had no option than to reconsider the
continuation of its webOS-based devices.
Hence, in a major restructuring plan announced in August 2011,
H-P decided to abandon operation of the underperforming webOS
devices. However, the tech behemoth stated that it would continue
to explore options to optimize the value of the webOS software
going forward.
H-P's present chief, Meg Whitman, who was
eBay Inc.
's (
EBAY
) former CEO, seems to be enthusiastic enough to keep webOS going.
Under her leadership, H-P is now planning to make its webOS mobile
system available as open-source software that anyone can freely use
and modify.
It can be said alternatively that the PC maker is donning
Google's hat. The ace search engine offered its Android software as
an open-source program, thereby opening the platform to developers
so that they could individually enhance the program.
With this initiative, H-P expects a new generation of
applications and devices, eventually establishing webOS as a
profitable part.
For the past few quarters, H-P has been struck by bad luck,
which is reflecting in its share price. Changes in CEOs, lackluster
PC demand, the decision to acquire Autonomy Corp. at a premium
price and the recent hard drive supply shortage due to the Thailand
floods are worth mentioning in this regard.
Though we believe that the open source project was initiated a
bit late, webOS could do better this way than any other. Overall,
it will be worth watching whether Meg Whitman could position H-P to
give the other smartphone and tablet makers a reason for
concern.
Currently, H-P has a Zacks #3 Rank, which translates into a
short-term Hold recommendation.
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