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HP announces split into two companies, but sadly they won’t be called H and P

HP, after years of will-they-won’t-they deliberation, has officially announced that it will be split into two separate companies: HP Inc, which will focus on PCs and printers, and Hewlett-Packard Enterprise, which will take over the servers, storage, and other enterprisey aspects of HP. Current CEO of HP Meg Whitman will become the CEO of HP Enterprise; HP’s head of printers and PCs, Dion Weisler, will become HP Inc’s new CEO.

In theory, this split will give each company the focus, independence, and flexibility to effectively compete in markets that have become a lot more competitive over the last few years — Lenovo has eaten a lot of HP’s bread-and-butter PC business, and the commodification of the server market (mostly thanks to Intel/x86) has weakened HP on that front as well. Funnily enough, printers are still one of HP’s biggest profit centers — but obviously, that isn’t really a growth market.

HP’s split comes at a time when it’s fairly fashionable for larger technology companies to spin-off or break-up into smaller chunks. The idea is that these smaller companies have a narrower focus, and can thus react to market/consumer demands much faster — and, of course, be in a better position to take on the next startup that threatens to cripple their business entirely. Just last week, Ebay announced that it would be spinning off PayPal into a separate company — a move that shareholders were very fond of (Ebay climbed about 8% that day).

HP has been toying with the idea of breaking up some of its divisions for a few years. Back in 2011, HP announced that it was interested in spinning off its PC business — but in the end, then-new-CEO Meg Whitman decided to maintain the status quo for the time being. Now, some two years after Whitman restructured the business, HP still isn’t doing very well — and so it’s time to do something a little more dramatic. Read the full press release for all of the details — but basically, the company is being split along consumer/enterprise lines, with printers and PCs going one way, and every other division/product (servers, networking, software, etc.) going towards HP Enterprise. The split should be completed by the end of fiscal year 2015 — October 2015.

Moving forward, the new HP Inc will focus on “new computing experiences” and “new markets” like 3D printing, ultimately working towards “inventing technology that empowers people to create, interact and inspire like never before.” HP Enterprise will “accelerate innovation across key next-generation areas of the portfolio.” Overall, the main thing is that the new companies will be able to focus their R&D efforts and financial resources on things that will directly benefit them. Presumably HP Enterprise will continue to work on The Machine. It will be interesting to see if HP Inc finally gets into the smartphone market, after Whitman said way back in 2012 that they really should get into that market.

Personally, I’m a bit disappointed that the two new companies aren’t called Hewlett and Packard — but it probably is the right move to make, business-wise. HP, along with other big tech giants from the pre-Google days such as Dell, Microsoft, IBM, are now being faced with the hard truth that the wellsprings that made them hundreds of billions of dollars will probably dry up a lot faster than they expected. In the olden days, technology and consumer demand moved slowly enough that companies could keep up — but now, it’s becoming increasingly hard for these behemoths to fulfill that demand before a sprightly little startup arrives on the scene and quickly lays down roots. The split into HP Inc and HP Enterprise, if they are managed well, could be a very savvy move.

http://www.extremetech.com/computing/191496-hp-announces-split-into-two-companies-but-sadly-they-wont-be-called-h-and-p
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Paistab, et see teema on muutmas üheks kuumimaks teemaks:

HP Splitting Itself in Half: Consumer and Business Divisions Become Independent
HP is trying to do what it set out to do back in 2011, only without the marketing faux pas generated by the blunt statement that they were trying to leave the PC industry. Not that the latest move is that much less jarring.

For those of you who don't know, HP said, back in late 2011, that it was going to leave the PC market altogether. And it did it quite suddenly.

Due to how unexpected the announcement was, and the fact that HP was basically the top PC maker at the time, the revelation did not go over well. At all.

In fact, it got so bad that the company’s share value dropped significantly, and eventually, the CEO at the time, Leo Apotheker, had to take the fall and get fired.

Of course, the debacle had to do with a really bad acquisition of the firm Autonomy, which still hasn't managed to get the fraud charges dismissed, but that's neither here nor there.
HP is splitting in half

According to the Wall Street Journal, the company is going to divide into a consumer business and a company dedicated solely to business customers.

This move is basically what would have happened back in 2011, but because of a really bad miscommunication and other issues happening at the time, and their rather poor handling and exposure, new CEO Meg Whitman had to spend a few years calming waters instead of doing something so drastic.

Now, though, with the impact faded from immediate memory, the company can go ahead and do what it originally wanted.

It's pretty ironic if you think about it. It makes it seem like Apotheker's forced departure was more of a scapegoat tactic than anything. But it's not like there weren't people who saw that at the time. Of course, if the Autonomy acquisition hadn't happened, he might not have been forced out at all.

Anyway, HP apparently wanted to sell its PC division to Dell or Lenovo, especially since the latter was basically tied with it for top PC supplier worldwide.

Alas, this didn't happen, so HP is essentially spinning off the business section, and doing the same with the data storage / server / services groups.
Management plans

Current HP CEO Meg Whitman will run the business group and keep a distant eye on the PC business, while Dion Weisler, one of the PC division's executives, will be the actual CEO of that company. The separation should be announced any day now.

http://news.softpedia.com/news/HP-Splitting-Itself-in-Half-Consumer-and-Business-Divisions-461086.shtml