The ‘bet on webOS’

Earlier today I was reading this brief piece on This Is My Next, titled Why HP killed its webOS devices, and while what Cathie Lesjak (CFO of HP) claims makes sense, I still fail to grasp the general logic behind HP’s strategy regarding webOS.

From the article:

To put it simply, the TouchPad and webOS devices failed to meet HP’s financial targets and unit sell-through expectations. And HP failed to “position webOS as the clear number two platform for tablets.” According to Cathie, HP’s “bet on webOS” would result in an even larger loss in Q4 if the company continued business as usual […]

Ms Lesjak adds:

To make this investment a financial success would require significant investments over the next one to two years, creating risk without clear returns. […]

As I said other times, I’m not an analyst, and business strategy is definitely not my field. But simply as an observer, I can’t help wondering what HP was thinking all along since the Palm acquisition, and also why HP decided to acquire Palm in the first place. This ‘bet on webOS’, how did HP expect would pan out?

They showed the TouchPad, the Veer and the Pre³ at the Think Beyond webOS event in February (and the photos taken by Engadget during their liveblogging well capture the atmosphere of a company which apparently believed in its products); the presentation was entertaining and, I’d say, rather well orchestrated (especially since it heavily borrowed from Apple’s keynotes). They teased the audience only to announce that those three fantastic devices would have been available ‘in the summer’. First mistake.

The first of those three products to be available was the Veer, launching on AT&T on May 15, arguably the least powerful, attractive or interesting of the three. Second mistake.

Then the TouchPad, finally available on July 1, only in the USA. July and August, from what I’ve observed, are by far the slowest months of the year. Did HP really expect the TouchPad to be an exceptional success during this time of year? Third mistake.

Many who reviewed the TouchPad pointed out some issues which — from what I’ve heard — have largely been addressed in the latest webOS 3.0.2 update. Now the TouchPad works a bit better, I hear, but it’s too late because the tepid reviews are already out there and sales have been disappointing. Instead of prematurely launching a half-baked tablet in a less than ideal timeframe, why not aim for a September launch of a more refined TouchPad? Fourth mistake.

I reckon this ‘bet on webOS’ has been developed like this: let’s make all the possible false steps to thwart our own products, and hope for the best.

HP was in a unique position: the only Apple competitor to be in control of both the hardware and the software. It was a path worth risking for despite initial slow sales[1], instead HP just gave up. Without even launching the TouchPad outside of the USA. Without even trying. This, for me, is the most exasperating detail.

Now HP’s webOS VP Stephen DeWitt says that “We are not walking away from webOS” — I’m tempted to quip Well, perhaps it’s better if you just leave webOS alone instead of screwing it up even more, but really, I think that with this move, HP has shown how not serious it has been with webOS, how little it has believed in webOS, not to mention the blow to HP’s credibility as a company. How can you develop for (or buy products of) a company with this kind of throwaway approach?

1. What do you expect to sell in August, anyway? I don’t know in the States, but here in Europe August is traditionally devoted to holidays — people go away, shops are closed, etc. — and is a really slow month, commercially speaking.↩