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HP acquires Palm for $1.2 billion

HP acquires Palm for $1.2 billion

HP has announced it's acquiring of Palm for $1.2 billion - saving WebOS in the process.

The rumours of ex-leader of the PDA marketplace, Palm, being up for sale have proved true, with Hewlett Packard spending an estimated $1.2 billion on acquiring the company.

The announcement of the deal, reported over on the New York Times, results in Palm becoming a wholly owned HP subsidiary - and gives HP a big boost in the smartphone and possibly tablet PC market.

Industry pundits have been saying that Palm was a likely target for acquisition ever since the company's Pre smartphone - running Palm's critically acclaimed WebOS operating system - received a lukewarm market reception. HP, on the other hand, has been producing a variety of Windows Mobile-enabled range of iPaq smartphones for business users, also without a great deal of success.

While the deal provides a lifeline for Palm, it remains to be seen if the company can take two not-terribly-successful smartphone business units and combine them to reinvigorate both company's offerings and compete against the likes of Apple's hugely successful iPhone and the increasing popularity of handsets based around Google's Android.

The £790 million deal - which sees HP valuing Palm at $5.70 (£3.75) a share, a premium on the $4.63 valuation the company had at close of trading on Wednesday but significantly lower than its 52-week high of $18.09 - will see HP also acquiring Palm's estimated $400 million debt, which the company will pay off using Palm's cash assets.

Interestingly, HP's executive vice president for the personal systems group Todd Bradley should be well-placed to guide the successful merger of the two companies: before moving to HP in 2005, he served as Palm's chief executive officer. Palm's current CEO, Jon Rubinstein is expected to remain at the company.

It's thought that HP will continue to develop in and invest in WebOS, both for smartphones and - interestingly - for slate-format devices as well - although as yet no product announcements have been forthcoming.

Are you pleased to see Palm find a buyer, or has HP ended up with a lemon? Is WebOS the future for mobile devices, or should the company ditch it in favour of a customised vesion of Google's Android - or even Windows Mobile? Share your thoughts over in the forums.

19 Comments

Discuss in the forums Reply
general22 29th April 2010, 09:35 Quote
Party for Palm at Todd Bradley's house :)

But seriously it seems like a good deal for HP and palm probably have a ton of patents that would justify this purchase anyway.
darklord of chaos 29th April 2010, 09:59 Quote
"It's thought that HP will continue to develop in and invest in WebOS, both for smartphones and - interestingly - for slate-format devices as well " - does seem a good idea and give a fourth option to the market but addmittidly I do not know much about webOS.
NuTech 29th April 2010, 10:15 Quote
Saw this comment on Engadget, had to repost it.
Quote:
So, pretty much the worst eventuality possible has happened. HP, famous for their shitty quality hardware, has bought Palm in an attempt to turn around a company bankrupted by shitty quality hardware.
Jamie 29th April 2010, 10:28 Quote
Seems a bit expensive to me.
veato 29th April 2010, 10:37 Quote
I liked the Pre. Some of its features were excellent. It was unfortunately let down by crashing and drove the missus to despair. It could have been an excellent device.
Flibblebot 29th April 2010, 11:30 Quote
I think HP has probably bought the company more for its use in an iPad-alike rather than any kind of smartphone. I'm not sure it's worth that much, but obviously HP sees some future use for Palm's technology & know-how.
eddtox 29th April 2010, 11:41 Quote
Isn't webos supposed to be horribly insecure? That is a big problem in a smartphone and an even bigger problem for a slate device imo. Am I the only one who thinks that phone OSes aren't the way forward for slates? I really think nokia and intel have the right idea with meego.
stonedsurd 29th April 2010, 11:47 Quote
Quote:
Originally Posted by eddtox
Isn't webos supposed to be horribly insecure? That is a big problem in a smartphone and an even bigger problem for a slate device imo. Am I the only one who thinks that phone OSes aren't the way forward for slates? I really think nokia and intel have the right idea with meego.

Everything has holes. Holes can be patched.

Also, since WebOS is based on the Linux kernel, it's inherent advantage is that it can be scaled up or down to run on a variety of hardware, from RISC architecture devices to full scale x86 hardware. I think I can see how HP would be excited to have such an OS on board.
wuyanxu 29th April 2010, 12:03 Quote
i would love a WebOS based tablet though. a re-designed interface will make it miles better than ipad
rickysio 29th April 2010, 12:07 Quote
Quote:
Originally Posted by stonedsurd
Everything has holes. Holes can be patched.

Also, since WebOS is based on the Linux kernel, it's inherent advantage is that it can be scaled up or down to run on a variety of hardware, from RISC architecture devices to full scale x86 hardware. I think I can see how HP would be excited to have such an OS on board.

We already have MeeGo in one corner - I would have appreciated if Palm just joined the coalition and just stop the (proper) Linux OS arms race so they can fight against Symbian^3 (N8 is tempting me away from my N900, believe it or not) Apple's iPhone OS and Android, and WinMo 7.
mull 29th April 2010, 12:42 Quote
I'm much more excited about an HP Slate with WebOS than Windows 7. Windows 7 on a touchscreen is a horrible kludge.
eddtox 29th April 2010, 13:13 Quote
Quote:
Originally Posted by mull
I'm much more excited about an HP Slate with WebOS than Windows 7. Windows 7 on a touchscreen is a horrible kludge.

I definitely don't think that a full-fat desktop os is the way forward for slates. But we do need something that has more to offer than a phone os. That's why I'm excited about meego.
Sifter3000 29th April 2010, 13:13 Quote
Quote:
Originally Posted by mull
I'm much more excited about an HP Slate with WebOS than Windows 7. Windows 7 on a touchscreen is a horrible kludge.

My thoughts exactly.
glaeken 29th April 2010, 15:41 Quote
Palm needs to distance themselves from sprint. I hardly know anyone who uses the sprint network. And since most people really can't afford an unlocked smart phone, they have to get Pres through sprint.
Leitchy 29th April 2010, 17:32 Quote
1.2 billion might be expensive, until you take into account all of Palms patents wardrobe for handheld devices! Generally it means that if Apple decide to go after HP with patent infringement like they have with HTC - HP now have the means to counter sue based on Palms patents.

This is why HTC wanted them in the first place, and also google!
shaffaaf27 30th April 2010, 02:31 Quote
just dont touch the openness of webos please
TheUn4seen 30th April 2010, 03:57 Quote
Well, i hoped that WebOS would silently die. Between Symbian, Meego, Android, Maemo, Apple crap and gods know how many other proprietary systems we really don't need another slow, unstable, shady (continuously reporting location to who-knows-where) and full of holes system. Three big OSes for mobile devices is enough to keep the competition hot, more than five is too much and causes too much software market segmentation.

On a side note, everybody wanted Palm, the company in itself is worthless but they own a sh*tload of patents. If you own Palm and have a lot of money, you can successfully sue pretty much everyone, from Microsoft and Apple to your damn local meat store.
GreatOldOne 30th April 2010, 12:49 Quote
Jamie 30th April 2010, 17:23 Quote
Quote:
Originally Posted by GreatOldOne
Bono probably isn't to happy about, considering he's lost almost £100m on the deal:

http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/telecoms/7648427/U2s-Bono-loses-out-as-Hewlett-Packard-swoops-on-Palm-for-1.2bn.html

Oops.

He's as good at investing as he is singing.
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