Hewlett-Packard announced Thursday that it is getting out of the consumer electronics business and getting deeper into business software. Calling it "a difficult but necessary decision," CEO Leo Apotheker said the company would pull out of the tablet computer and smartphone business entirely, discontinuing its TouchPad tablets and webOS phones. HP also plans to spin off its personal computer division, instead focusing on business services with the planned $10 billion acquisition of British software maker Autonomy. Is this dramatic "business makeover" wise?
It worked for IBM: The PC market is an "ugly," low-margin business with "fickle consumers," says Shira Ovide in The Wall Street Journal. IBM realized that years ago, and decided to focus on big businesses and their lucrative software needs. It worked out for IBM, and it "makes sense" for HP, too. "The world zigs left, company strategy zigs along with the trend."
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