HP concocts combined printer, PC unit: Does it make sense?

HP concocts combined printer, PC unit: Does it make sense?

Summary: It's unclear what consumers and corporate buyers would get from a combined HP printer and PC unit.

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HP's increasingly commodity business units---PCs and printers---will reportedly be combined in a sweeping reorganization.

According to AllThingsD, HP will combine the personal systems group and printing unit. Vyomesh Joshi, chief of the printing unit, will leave the company. Joshi has repeatedly been a CEO candidate as HP swapped leaders like NFL teams change out football coaches. Todd Bradley, head of the personal systems unit, will lead the new unit.

The larger question: Would this reorg make sense?

From a financial perspective, a combined unit could solve a few problems. Consider:

  • The profit margin picture for the combined unit would improve. Printers are a cash cow, but facing slower growth.
  • A combined unit would hide any troubles with the PC business should it stumble going forward.
  • PCs and printers could be lumped into a slow-growth mature unit that would be easier to separate.
  • Printers and PCs go together and a combined unit may be able to create bundles to entice IT buyers. A combined unit may also be able to drive more innovation between the two devices going forward.

Here's a look at the financial profiles for both units, which accounted for exactly 50 percent of HP's first quarter sales.

Topics: Software, Data Management, Enterprise Software, Hardware, Hewlett-Packard, Printers

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20 comments
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  • Funny how the mind works.

    When I first read the headline for this article I jumped to the conclusion that HP was making a device that combined a printer with a PC. I went immediately to "fail". Then I read the article. Funny how are minds can play tricks on us and we can jump to conclusions.
    gribittmep
    • DITTO

      I was quite excited to see HP's latest all-in-one PC, printer, scanner device. I'm sure it would fail, but I was a least hoping for an image :D
      ian20x
      • actually...

        thats the entire reason i clicked on this article lol
        OneTwoc21
    • Same here

      I just wanted to see what that device would look like :)
      paul2011
    • Me Too

      Then I read the other post's title, which was clearer. I also read the other post first, and then saw the author was Zack Whitaker, who added nothing beyond a restatement of AllThingsD's post. Had I known it was Whitaker, I wouldn't have bothered.

      At least Mr. Dignan offered some analysis for why. The interesting thing is that with the Printer exec leaving and the printer people reporting to a PC exec, I'd say the PC group absorbed the printer group, which in corporatese is supposed to imply "Good PC group, bad Printer group." Does this conform to our understanding of what's going on at HP? Or does that beg the question that there is something to be understood?

      As to impact on customers, I'm going to guess pretty close to zero.
      DannyO_0x98
    • -

      -
      Tim Cook
    • LOL yep...

      then I started thinking Tablets+Printer. Since those small Scanners exist why not a small printer+tablet too...

      LOL

      (and, I read the comments first, then the article then I commented.... HAHA)
      TheFilipinoFlash
  • It does make as much sense...

    As a TV with an embedded DVD player or a VHS-DVD combo. It may please a tiny audience with a very specific need.

    Considering how disposable printers became in the last years, this is a terrible idea. What going on in their head? What's the key incentive with such an innovative (not!) product?

    Epic fail I call.
    TheCyberKnight
    • ummmm

      Read the article...
      themp
      • Very funny...

        Conclusion: reading the summary and vertical reading are not enough!
        The epic fail is now my comment.

        Thanks for pointing it.
        TheCyberKnight
    • This is about their production units

      They're not making a combine PC-printer. Just the same people making the PCs will also be making the printers.
      Aerowind
    • It is a good filter

      Some "readers" only have to read a half of title before they start writing comments.
      One more child left behind.
      paul2011
  • Not Gonna Work

    Corporations are all into either no printing or a very few network printers outside of graphic design departments.

    No way does a corporation want the added expense of buying ink cartridges for cubical workers.
    DaveLG526
    • Ummm.....

      Read the article before commenting.
      gribittmep
  • Sounds like a bad plan to hide the difficulties with their PC unit

    By bring down both!

    Printers for HP is big enough for its own BU, tagging on the stagnant PC market won't help it or bring it down.

    HP looks like another company that is determined to kill itself with bad management.
    Richard Flude
  • This is the real problem with the PC market

    The IDC forecast will show that the PC market growth will come mostly from the emerging markets. The developed market relies mostly on replacement PC units for desktop along with low-rate growth in laptop PCs.

    Point being this - let alone HP, not even DELL can serve as the PC market bell-weather. The pivot point has shifted to East Asia, specifically China/Korea/Taiwan combo which makes all the more sense when you see Apple behaving like a Chinese ODM with some of its design and component sourcing from there.

    I would think Microsoft has to make a decision pretty soon on to remain an OS vendor or to become a full-vertical stack vendor like Apple, not withstanding the success or failure of Win 8 OS itself. It can acquire the PC division of HP or DELL's or both and immediately become a towering systems goliath to match Apple.

    American PC OEMs will finally exit the market conclusively by end of 2013 or no later than 2014.
    calahan
    • That will not happen

      [i]American PC OEMs will finally exit the market conclusively by end of 2013 or no later than 2014[/i]

      It is a far too large a market for anyone to consider something as foolish as that.

      :|
      Tim Cook
      • Really - how else can you explain recent HP management changes/DELL too?

        Not in America! There simply are no margins in its unless you operate from elsewhere!

        You sure would agree that of big four PC/Enterprise servers/systems makers in America (IBM, HP, DELL, SUN), one has gone bankrupt unable to clear the mountain built by Linux in the Server world (SUN). Funny how the company that wanted to release Sun workstation like PC-clones using Taiwanese and Japanese OEMs in 1990 and initiated a bitter anti-trust battle against Microsoft (initiated by complaints to DOJ by Sun, Oracle, IBM, Apple, Lotus, Real Networks and Netscape and of course Linux orgs) was gone by end of the 2010 decade. And it became irrelevant not at all because of Microsoft but inspite of Microsoft. Microsoft helped Apple with initial investment when it was on the verge of bankruptcy and did the same with Sun. But what happened of it? It still went almost bankrupt and was acquired by Oracle as a losing business.

        Among the four, IBM has shed its PC business to Lenovo which thrives now and will soon be the biggest competitor to Apple both in PC and tablet markets. Needless to write, IBM makes its own mainframes, massive servers, storage equipment, LAN equipment as well as its own enterprise management software, IT asset management software, application server etc. It is a true enterprise and hardware pioneer still operating in America. Not to mention its in house outsourcing division that diminishes costs for buyers with servicing.

        Among the four, DELL has decided to become like EMC. Or like Cisco. It has been buying in SAN companies, LAN companies, DC companies. It makes its own storage arrays and connects its servers with its own data center solutions and even WAN routes them to the ISP or Carrier in the Enterprise datacenter. Essentially it has become a storage/networking giant in a matter of years and is a direct threat to EMC/Cisco and IBM.
        You can see that DELL is copying IBM. That means, it will shed the PC division in a matter of years. For sure!

        Where does that leave HP? Leo Apotheker tried to make HP start to look like IBM. But HP's inertia prevents it. It looks like it cannot become an enterprise software vendor nor an all-encompassing enterprise hardware vendor like IBM. Sure it has a server division and its own LAN division. But it lacks the other hardware smarts of IBM or DELL or EMC. It also lacks the networking smarts of Cisco which itself is hurting on account of an enterprise/carrier voice/data communications race-to-zero margin effect.

        Essentially, HP has to sell some divisions to survive or to morph in business character. Its products need a stronger margin focus as well as enterprise software focus if it is to even *stay* relevant in the worldwide enterprise markets. This is difficult but absolutely necessary.

        I stand by my prediction or forecast on two things:
        - HP will shed its PC division sometime in the next few years.
        - DELL will sell its PC division sometime too.
        - Microsoft will need to make a division on its PC OEM business model - should it work with an active OS-hardware OEM model or should it acquire a few PC divisions to create a PC software/systems vendor.
        calahan
    • Microsoft selling a vertical stack?

      I'm not sure how the other OEMs would react to Microsoft deciding to sell the whole widget. Given Microsoft's previous legal issues regarding pricing their products in ways that would have effectively kneecapped OEMs that offered competing products to Windows and Office, I doubt the other OEMs would take this lying down.

      Besides, selling the full widget means that it's all on you if something goes wrong, and I don't think Microsoft would particular want to open that bag of hurt.
      Third of Five
  • A temporary reprieve...

    Eventually, they're going to become a printers only business, if they don't correct their mis-steps.

    Putting all their eggs in the Windows 8 (&WebOS?) basket is going to be a massive mistake.

    Detailed analysis here - http://www.tech-thoughts.net/
    sameer_singh17