Long live webOS! $5.70/share, which is a nice bump from the doldrums but well off recent highs. And looks like Kelvin & I will need to get a new hobby— damn shame, we were just perfecting those financial models. Let’s go to a reputable news source for coverage.
This entry was posted on Wednesday, April 28th, 2010 at 5:11 pm by Jake and is filed under Mobile Posts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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April 28th, 2010 at 5:13 pm
PreCentral has a liveblog, too.
http://www.precentral.net/hp-palm-acquisition-conference-call-liveblog
April 28th, 2010 at 5:17 pm
Still digesting, but to me this is as much as anything the rebirth of HP, where they once again seize control of their own destiny instead of being a commodity provided or someone else’s product. HP used to make their own chips, OS, and so on. They were Apple before Apple, in many ways really. Now, with the best mobile OS on the market, HP can once again differentiate themselves and really step up and move the industry forward– not just get pulled along.
It’s the complete opposite of the Compaq deal, really. And a perfect complement. It even works geographically. Add another $2 to the price & I’d be happier, but this is good enough as stock holder. I think I’ll sell my Palm stake and put half the money in HP. They’re a forward-looking company.
April 28th, 2010 at 10:35 pm
This looks like what clinched the deal for Palm. Sell-in of about 250,000. Palm really had no choice, they were bleeding cash.
————-
The following is the text of a Form 8-K furnished by Palm, Inc. on April 28, 2010:
Palm, Inc. (“Palm” or the “Company”) is updating its guidance for the fourth quarter of fiscal year 2010. The Company expects revenues for its fourth fiscal quarter to be in the range of approximately $90 million to $100 million on a GAAP (1) and a non-GAAP basis. Revenues for the fourth fiscal quarter are being impacted by slow sales of the Company’s products, which has resulted in low order volumes from carriers. Palm also expects to close its fourth fiscal quarter with a cash, cash equivalents and short-term investments balance between $350 million and $400 million. “
April 29th, 2010 at 12:51 am
Yes, they were due for a huge loss this quarter. Ironically, the warning could be good news. The Q4 revenue was going to be phone sales – promotional rebates (to Verizon). It’s possible that the rebates were higher than expected because sell-through was higher. Either way the Q3 ASP is the wrong effective ASP to use for Q4 (Palm had guided to mid-teen gross margins, and that has likely dropped to 10% or so). ASP could be as low as $288 (centro-like), which would imply sell-in of 325K or so. That’s probably 30K for france, and all the rest to AT&T.
April 29th, 2010 at 1:42 am
I thought promotional rebates counted as both revenue & COGS? So I guess best case is they sell-in 325K, sell through 870K and get their channel inventory to a decent number.
April 29th, 2010 at 3:02 am
Nope, rebates are contra-revenue in the quarter they are offered.
April 29th, 2010 at 2:45 pm
Do we expect HP to resurrect the Treo Pro 🙂
April 29th, 2010 at 4:18 pm
Didn’t listen to the conference call, but this sounds to me about the best situation that Palm could have hoped for. Someone who has hardware expertise, distribution channels, and a stated desire to continue developing webOS, with the resources to do it, is pretty much the ideal case. The only potential hole is that HP has no real relationship with the carriers, but they certainly can handle that.
Palm has won the hearts of many, including you guys, basically by being open as far as developers are concerned, allowing sideloading, etc. However, big companies (the ones that own mobile operating systems, anyway) tend to like the Apple model of selling apps through a dedicated App Store, locking down content and raking in 30% of every sale. Is there any chance that HP could decide, somewhere down the road, that they want to do this? HP supposedly said in their conference callthat they were interested in building out an HP “connected mobile ecosystem,” and “would not comment on whether they will try to create an iTunes-like infrastructure.” We know what those words mean to Apple.
I also agree that this sounds like a good move for HP, whose only innovation lately was having Vivienne Tam design a netbook.
April 30th, 2010 at 12:38 pm
The news this morning is that HP is killing the Windows 7 Slate that they showed off with such fanfare. I think this means there’s actually a fair chance we get a webOS tablet before Christmas. Excellent.
April 30th, 2010 at 1:18 pm
Engadget wrote about someone’s hands-on with Slate and they were not very impressed with the hardware design. It really does seem too thick and chunky. No one has ever put out a Windows slate with a killer form factor/ weight/ battery life, but this one seemed the closest. Even so, it can’t compare to the iPad in those categories. Personally, I think I would prefer Windows running on a tablet than a smartphone OS, all things being equal, but it needs to be thin and no heavier than 2 lb while still having acceptable performance and battery life. Maybe Windows/x86 is too processor and battery intensive to ever allow shoehorning into a decent sized tablet.
That being the case, Chrome OS might be the sweet spot for me. Capable of running on ARM processors yet still promising to have a desktop-class browser. WebOS really doesn’t solve any of the real problems of the iPad, chief among them IMO is a web browser that’s great for mobile, but not as good as a PC browser (try loading up mail.yahoo.com, for instance).
April 30th, 2010 at 8:30 pm
I started to write a post to the same effect — not about webOS, but that the problems with the iPad were probably problems with tablets in general, even if they ran a full-fledged OS. Do you think Chrome OS would be any better? If the problem is really a browser, then either Apple or Palm/HP would be able to correct that by just releasing a better browser.
In my opinion, it’s sort of a lose-lose if you’re looking for a real desktop-class experience. Running a full-fledged desktop OS on a tablet stinks (Windows, Mac, whatever) if it’s not optmized for a touch interface, and so far, the touch OSes don’t have desktop-class apps, and may not be able to really replicate many desktop operations without a keyboard. Face it, if you want full Office compatibility, you’re not going to be wanting to edit an Excel spreadsheet with a touch interface.
People have to change their expectations of what a tablet can do if this segment is going to go anywhere (and I’m still not convinced that it will — the iPad may be a big ol’ flash in the pan). I still haven’t seen any evidence that they’re great creation devices, and I’m not going to hook up an external keyboard.
Sent from my netbook 😉
April 30th, 2010 at 10:49 pm
TechCrunch piles on, asserting that Windows7 simply is too power hungry for a tablet. My take? TechCrunch will stop at nothing to promote their CrunchPad alternative tablet. You can’t expect an objective article from them 🙂
April 30th, 2010 at 10:57 pm
I think when you get to a big screen, the needs of touch interface converges pretty well with the normal mouse input. I have no real problems finger-navigating Vista on my HP with the exception of text entry and scrolling via scrollbar (that sucks). Text entry does need some work but it would be pretty trivial to add kinetic scrolling. But tabs and taskbar buttons are very fingerable. IMO, many of optimizations for a smartphone (pinch to zoom, full screen browsing, etc) are only necessary for a small screen.
April 30th, 2010 at 11:08 pm
NY Times has an article comparing the divergent paths of Palm and Motorola following their fateful decisions to adopt or eschew Android. Not especially insightful, but it’s worth thinking about. I often point to HTC as the company Palm could have been if they fully realized the promise of spinning off the OS. As a hardware company, they were obligated to fully embrace Windows Mobile, maybe Symbian, and later Android, rather than stay loyal to PalmOS.
http://www.nytimes.com/2010/04/30/technology/30moto.html
May 3rd, 2010 at 11:15 am
Now that the Pre has fallen to $30 on Verizon, and it seems well-known that having Spring as a launch partner didn’t work out so well, do you think that HP will stick with Sprint for new hardware launches? If they bring the next-gen webOS hardware to another carrier, what are you guys gonna do? Wait ’til it gets to Sprint, or jump ship?
May 3rd, 2010 at 11:41 am
It’s tough to beat $38/month. Then again, if the 4G version hits Sprint the price will no doubt jump. Really depends on what the hardware is.
May 3rd, 2010 at 5:57 pm
Well, we are under contract, so if Sprint is not the carrier for new devices, we’ll have to watch from the sidelines. I do think that with their new financial backing, Palm will be able to manage for the long-term rather than the short-term. So they might not be as deathly afraid of the Osborne effect, they might not be as desperate to sign away their future with carrier exclusives, etc. Lookig at how other companies handle carrier exclusivity, it seems like it’s a matter of making variations for each partner, so maybe HP’s big bucks would allow Palm to develop more devices at a time. I can’t see Palm being successful with a single uniform hardware design (like Apple is).
May 3rd, 2010 at 8:27 pm
Doubling down on WebOS… Just picked up a touchstone kit ($20) and the Palm cigarette lighter adapter ($13) at RadioShack on clearance. Working great in the car (will post photos later).
May 3rd, 2010 at 11:14 pm
Nice! I’ll stop by tomorrow.
May 16th, 2010 at 12:00 pm
Jake pointed out some new info on the merger on Twitter, thought we should have the discussion here: Who were companies A-E? http://www.siliconbeat.com/2010/05/14/palm-reveals-the-background-of-hp-merger/
The actual filing is worth reading (it’s much more detailed). The direct link to the relevant “Background of the Merger” section is below.
http://www.sec.gov/Archives/edgar/data/1100389/000119312510120843/dprem14a.htm#toc34191_14
To address Jake’s question as to the identities of the other interested parties (Companies A, B, C, and D), it certainly would be fun to try to piece it together from the rumors that had been flying in April.
1) Who were the rumored parties? Initially, HTC and Lenovo, right? Who else was ever really mentioned? I’d love to compare the timing of the rumors with the timelines detailed in the filing.
2) Company A and B made offers that were no good, along with HP’s original offer at $4.75.
3) Company C entered the bidding later, originally offering $6-7, but later dropping the bid to $5.50, declined to go any higher to match HP’s $5.70 bid, but then offered to buy some patents and license webOS for a flat fee of $800mm. I’m thinking it’s HTC because they’d benefit most from the patent acquisition and would be best suited to bother making webOS devices.
May 21st, 2010 at 6:32 pm
If this story is to be believed, then HP just announced that the Slate will be going on sale in October while running webOS. Whaddyathink?
May 21st, 2010 at 6:34 pm
Link: http://news.cnet.com/8301-31021_3-20005638-260.html
June 1st, 2010 at 7:57 pm
Stumbled onto this blast from the past while searching for Firefox links. What is it with Palm and companies A & B? Interesting to see Nokia & Motorola in the game even back then.
http://www.pyslent.com/?p=828
June 2nd, 2010 at 7:55 pm
Just read that HP didn’t buy Palm “to be in the smartphone business.” Color me purplexed. If not smartphones, then what? What are these “small form factor web connected devices” that HP purports to have tens of millions of? They don’t have any existing products that fit that description, do they?
June 2nd, 2010 at 9:45 pm
I’m betting the original comments had some nuance that was lost in transcription. Looks like a pretty full quote, granted, but people misspeak all the time.
I predict a “clarification” from H/Palm tomorrow, along the lines of “of course we will continue to expand & develop our best-of-breed webOS smartphones. What CEO Hurd intended to convey is that in the next few years even as there are millions of webOS phones on the market, there will be 10x as many other small form factor devices such as printers, tablets and digital photo frames.”
June 2nd, 2010 at 9:52 pm
Heck, one strategically placed “just” in the original paragraph long quote and all of a sudden it sounds much less like EOL for the Pre.
June 4th, 2010 at 12:26 am
Called it!
http://www.engadget.com/2010/06/03/hp-says-its-in-the-smartphone-market-after-all/