For those of you returning this week from vacation, you are walking in mid-drama to a lot of $h*# that hit the fan last week in the tech world. The big news this week will surely be follow up stories to the two big stories that broke last week: first, Google announced it’s buying Motorola Mobility and second, Hewlett Packard appears to be repositioning itself to be a software company instead of a hardware company.
Here are the “deets” while you were off the grid:
- Google buying Motorola Mobility. If you follow such things, you may recall that Motorola spun off its Mobility division earlier this year into its own company. Google, last week, announced a deal to buy said spin-off for $12.5 billion. What will Google get out of the deal? First, it gets a treasure trove of a mobile technology patents; as in 15,000 and another 7,500 pending. Keep in mind, Motorola invented the cell phone! Next up, Google gets a handset maker that can be exclusively dedicated to integrating with the Android platform (much like Apple’s fully integrated software and hardware mobile devices). As an added bonus, Google gets its paws on all those Motorola made television set top boxes and DVRs that it makes for the cable television industry. Can you say “Google TV?”
- Hewlett Packard announces an $11 billion deal to buy Autonomy and plans to “maybe” spin off its PC Unit. Huh? If you hire a plumber, don’t expect your leaky roof to get fixed. Expect your pipes to get upgraded to copper. It’s all so clear now. Last Fall, after the departure the disgraced HP CEO Mark Hurd, Leo Apotheker was hired to replace him from. Apotheker came from SAP. He’s a software guy. He’s an enterprise guy. He’s a cloud guy. He is not a consumer market guy. He is not a hardware guy. Fast forward: It’s nine months later and HP just announced its buying a search company (Autonomy) that specializes in data mining through things like social media posts, as well as online music and video files – for the enterprise. In other words, HP just upgraded to copper pipes for $11 billion dollars virtually wiping out its cash reserves in the process. About that leaky roof; WebOS tablets that just went on sale earlier this summer have been discontinued. WebOS, the coveted spoils of war from last year’s buyout of Palm, is dead. In the meantime, the PC unit is up for grabs.
Fallout, so far:
- HP’s stock has lost $16 billion dollars of its value since the Autonomy announcement.
- The day of the announcement, Best Buy was in possession of 245,000 HP TouchPads. If you’re thinking you’d like to buy one at fire sale prices, you’re likely too late. They’ve flown off the shelves all over the country after Best Buy dropped them to $99 to $149 depending on the number of gigs. They are virtually impossible to find in any store now.
- While Google says they have not abandoned their other mobile hardware partners (Samsung and HTC to name a couple), there is clearly going to be a scramble to see who is willing to stick around playing the role of Cinderella to Motorola as the ugly step-sister and who will bolt to cut deals with Microsoft or even RIM, dare I say. If HP had hung on a little longer with WebOS, who knows who would have hooked up with whom from all this mess.
Welcome back to the grid. If this is the slow days of August, imagine what September will bring.