Recent news is that Hewlett-Packard is to split in to two entities with one covering PCs and printers and another covering Tech services which is encompassing the enterprise computing sector. This is to offset the losses caused by the reduced demand for regular personal computers and printers due to mobile computing devices (smartphones and tablets) being the preferred way to go.
By splitting the entities, there is the ability for HP to have the companies focus on the expertise and value that each of them will provide without one of them affecting the other negatively. This was in contrast to HP previously acquiring Compaq who had bought out DEC who were known for the PDP-11 and VAX mainframe computers with their associated terminals and peripherals. In this case, HP’s PCs and printers company could place more effort on winning back the “personal computing and printing” market for both business and home users as well as increasing that effort that they started on printing for mobile devices that they started with their ePrint initiative.
The questions that can be raised here are what of the branding for the separate entities as in how each of these entities will be known. As well how will this affect HP’s footing in to the commercial printing sector such as the digital presses and photo printing systems – whether this will be part of the “Tech services” company or the “PCs and printers” company. Yet another question that can be raised is how research and development that HP has been known for will be affected, especially if one of the companies puts forward an innovation that is of benefit to the other company’s products.
This will remind me a bit of the way IBM divested themselves of their hardware businesses over the years, with the printing and typewriter business going to Lexmark, the personal computing business going to Lenovo and the data storage business going to Hitachi. It was in order for them to focus on the enterprise data services sector rather than running a monolith that has other loss-making functions.