Hewlett-Packard said Thursday it has completed its $1.2 billion acquisition of Palm, which is now a global business unit of HP  . According to company executives, HP expects to extend the reach of Palm's webOS and app store beyond the smartphone market through the launch of other types of mobile devices such as web-connected printers and tablets.
"With webOS, HP will be able to give its customers a unique and compelling experience across smartphones and other mobility products," noted HP Executive Vice President Todd Bradley. "This allows us the opportunity to fully engage in growing our smartphone family offering and the footprint of webOS."
Global Scale, Financial Strength
Palm's own webOS effort floundered in part because of the company's inability to quickly gain a substantial following in the developer community, noted Lisa Pierce, an independent analyst with the Strategic Networks Group. "Design, connectivity and applications are three necessary ingredients to mobile device (or OS) success -- two out of three doesn't make the grade," Pierce said.
However, HP expects this to change now that Palm has become one of its business units. "With the webOS we will be able to aggressively deploy an integrated platform that will allow HP to own the entire customer experience, to effectively nurture and grow the developer community, and to provide a rich, valued experience for our customers," Bradley told analysts when the deal was disclosed at the end of April.
Though Palm was able to make terrific contributions to the mobile industry, it was unable to capitalize on its multifunctional webOS as an independent company, noted IDC Research Manager Francisco Jeronimo.
"Money makes all the difference at the point of sale," Jeronimo said. "Palm didn't have the money to compete with Apple and RIM in the U.S. market and to make the brand known outside its home market."
Moving forward, HP expects to leverage its global scale and financial strength to enable Palm's webOS experience to compete more aggressively. "With HP's full backing and global strengths, I'm confident that webOS will be able to reach its full potential," said former Palm CEO Jon Rubinstein on Thursday. "This agreement will accelerate the development of this incredible platform with new resources, scale and support from a world-respected brand."
Coming To Tablets
As a well-funded business unit of HP, Palm will be able to assure carriers about the platform's future outlook as the business unit widens its portfolio beyond the current Pre and Pixi smartphones, Jeronimo observed. (continued...)
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