Dramatic restructure begins for Hewlett-Packard

In news that reverberated through the tech market, Hewlett-Packard (HP) has announced it will spin-off or sell its personal computing division. HP is the world's largest PC vendor, shipping 15 million PCs last quarter alone. 

LOS ANGELES, CA (Catholic Online) - The coming spin-off or sale, is intended to improve profits and drive up share prices, although Thursday's announcement provoked a drop in HP's stock price. It is a dramatic turnaround for a company that just 10 years ago committed itself to PC manufacturing when then-CEO Carly Fiorina oversaw the acquisition of Compaq.

Two immediate and prominent casualties of the move include HP's TouchPad, which was launched only last month. Sales have been lackluster, coming in well below prediction, so low in fact HP was compelled to almost immediately cut the price of the device by $100. Analysts credit the very popular Apple iPad for the TouchPad's near-instant demise. HP's CEO, Leo Apotheker said, "The tablet effect is real. Consumers are changing how they use PCs."
 
The webOS software that HP acquired via its 2010 purchase of Palm is also expected to be a casualty. HP reported that none of the webOS products reached their sales targets. HP has promised however that it will continue trying to "optimize the value" of its purchase [of Palm and webOS].
 
The future for HP is likely in enterprise software and information. A recent acquisition of British software developer Autonomy puts the company in position to pursue software development. Apotheker, is also the former head of the German software developer, SAP, which strongly supports HP's future strategy to make profits through software development rather than hardware sales.
 
Apotheker also announced that HP would also be shifting emphasis to its slow-growing services division.
 
The company has not made a final decision on how it will spin-off its PC division, but that a decision would come in the next 12-18 months.  The company said that its executives were authorized to  "exploring strategic alternatives" to its current model.

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