The New Apple? HP's Palm Acquisition Makes It Possible

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HP's planned $1.2 billion acquisition of smartphone developer Palm gives HP the technology and the app base that could make it not only a mobile device and cloud computing powerhouse, but also a formidable competitor with Apple.

Hewlett-Packard on Wednesday tore a page from Apple's business playbook with plans to use its acquisition of Palm as the centerpiece of a mobile strategy across a full range of mobile devices including smartphones, slate or tablet PCs, and netbooks.

HP did not mention specific potential competitors of its future mobile products based on Palm technology, including the Palm webOS operating system.

However, Todd Bradley, executive vice president of HP's Personal Systems Group, said at a conference call about the acquisition that the Palm webOS will help HP drive its mobile users' online experience.

"Today's announcement is very much about how HP will provide our customers with a great experience as they increasingly live their lives online from work, entertainment, and everything in between," Bradley said.

In addition to smartphone technology and webOS, Palm brings to HP a large developer base, over 2,000 apps, a platform to deliver cloud-based services, and the opportunity to drive more branded business, Bradley said.

"We anticipate that, with the webOS, we'll be able to aggressively deploy an integrated platform that will allow HP to own the entire customer experience, to effectively grow and nurture the developer community, and to provide a rich, valued experience to our customers," he said.

Such a platform makes HP a strong potential competitor to Apple, according to analyst firm iSuppli.

Palm has made only limited headway in the smartphone market so far, with a market share of 1.5 percent of units shipped in the fourth quarter of 2009, wrote Tina Teng, senior analyst for wireless communications at El Segundo, Calif.-based iSuppli, in an analyst brief. That put Palm in tenth place overall in the smartphone market.

However, the company's Pre smartphone offers significant advantages compared to Apple's benchmark iPhone, Teng wrote.


Next: Palm webOS Tops Mac OS X

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