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Topic: Hewlett-Packard

Who should buy HP's PC division? Samsung? Lenovo?

Summary: At the same time it was ditching its webOS-based hardware, HP announced that it was looking to "spin off" its Personal Systems Group, which includes its PC division. While that's not always code for "selling," it's clear that the tech giant had tired of the low-margin business, and that it may be looking for a suitor to pick up HP's computing assets.

Sean Portnoy

By for Laptops & Desktops |

At the same time it was ditching its webOS-based hardware, HP announced that it was looking to "spin off" its Personal Systems Group, which includes its PC division. While that's not always code for "selling," it's clear that the tech giant had tired of the low-margin business, and that it may be looking for a suitor to pick up HP's computing assets.

But if the leading PC maker is bailing on the industry, who would be interested in taking on its business? Certainly not Dell. However, there does seem to be some logic behind a couple of names being floated as potential partners.

The one with the most smoke behind it is Samsung, which has no desktop presence in the U.S. and is trying to expand its laptop business here. It's hard to say how much interest the South Korean electronics giant would have in desktops, but it could increase its market share significantly with such an acquisition. In fact, Charlie Demerjian at SemiAccurate reports that Samsung is the only company in the running, according to HP insiders:

The sources would not say anything more, just that Samsung has been floating internally for weeks since a recent reorg. This sale wasn’t a snap decision, it has been in planning for a long time.

But another Asian firm may be in the running. Lenovo has already played this game when it obtained IBM's computer business, but it could make a bigger splash in the consumer computing market with an HP purchase. Though it's the number three PC maker globally, Lenovo is a lesser brand in the U.S. consumer space that, like Samsung, could boost its standing with an HP acquisition.

There are a couple of other names mentioned, Acer and Asus in particular, but Reuters reports that they wouldn't be able to purchase the entire PC group with their current cash reserves, and would only be players if HP decides to break the Personal Systems Group into parts.

Who do you think should purchase HP's PC division if the company decides to sell it? Let us know in the Comments section.

Topics: Hewlett-Packard, Hardware, Lenovo, Mobile OS, Operating Systems, Samsung

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23 comments
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  • RE: Who should buy HP's PC division? Samsung? Lenovo?

    HTC
    jrp@...
    Reply Vote

    • HTC is not a PC OEM

      @jrp@... They are already working in a low margin business. I don't think they would get into another market where the revenues are razor thin.
      wackoae
      Reply Vote

  • If what you said is true... The first question should be why?

    If low margins makes selling PC's a bad idea for the number one guy... How can moving up a spot or three volume wise be good business for the others? It would seem a race to no where!

    Pagan jim
    James Quinn
    Reply Vote

  • Why buy what you can have for free?

    Why would anyone buy it? What do you get if you buy it? Do you get to use the name 'HP' on your products? No. What else would you get? HP's contract with Foxconn to manufacture computers? Go visit Foxconn yourself and sign one; no need to pay HP for it. HP's PC sales force? They'll all be laid off; wait for that and then hire however many you want.

    Michael Dell must be laughing his *** off. Half of HP's PC sales are going to fall in his lap without him having to pay a dime for it.
    Robert Hahn
    Reply Vote

    • RE: Who should buy HP's PC division? Samsung? Lenovo?

      @Robert Hahn Remember, Lenovo was the same way and IBM allowed them to keep the IBM logo for a period of time so people would know what they were buying.
      slickjim
      Reply Vote

      • Peter can you see it?

        @Peter Perry ... This is yet another casualty of the PC Price Wars and a telling one. If the number one seller does not see a good reason to stay in then why? First you have to design a product maybe do some R&D and what will you get in return? People can put millions and or billions into savings accounts have less risk and likely make better money. If a savings account isn't good enough how about a CD? No risk (something you can't get it the world of PC sales) and the money in the right CD package would likely be better:). Same thing is presently happening with Android.... Funny thing is that one has just started. Corpses shall abound over the next few years!

        Pagan jim
        James Quinn
        Reply Vote

  • I'll say it again

    HP should not sell its PC division; it should spin it off into a separate company (call it Compaq). The new company should inherit all of the consumer electronics businesses HP should never have bought in the first place (including Palm).<br><br>HP should then exorcise the ghost of Mark Hurd by spinning off its IT services division (call it "EDS"). HP's board should then change the bylaws so that any corporate buyouts valued at more than $500 million need to be approved by the stockholders.<br><br>Then, just maybe, HP will get out of the serial acquisition business once and for all and focus on engineering, product quality, and customer service.

    Edit: On second thought, make the threshold $10 million.
    John L. Ries
    Reply Vote

    • RE: Who should buy HP's PC division? Samsung? Lenovo?

      @John L. Ries

      For some of us older folks, the name Hewlett Packard is synonymous with great test gear; signal generators, oscilloscopes, etc.

      We used to fight over who got to use the HP scope.
      msalzberg
      Reply Vote

      • The blue ones

        Hey, maybe HP could sell the PC Division to Tektronix!
        Robert Hahn
        Reply Vote

  • RE: Who should buy HP's PC division? Samsung? Lenovo?

    HP PCs are pretty good looking esp. the Envy series. Hope they don't do that because other PC manufacturers make ugly piece of crap unlike HP but still no match to Apple :D
    shellcodes_coder
    Reply Vote

    • RE: Who should buy HP's PC division? Samsung? Lenovo?

      @shellcodes_coder Even Envy is not HP's own creation. It is what they got as part of Voodoopc acquisition. They actually managed to screw up the original voodoo design.
      papajohns
      Reply Vote

  • Microsoft

    HP was not only the number 1 PC saler but also Microsoft most reliable partners. I think that it is time for Microsoft to have its own hardware PC department and to build some PC fully optimised for Windows. This way Microsoft will perhaps be able to offer some needed competition to Apple in the high end PC market. Moreover whatever how good the O.S is if it is not supported by great hardware. Thus Microsoft should produce some great hardware for its upcoming Windows 8 and i don't think that Microsoft could rely on OEM for this.
    timiteh
    Reply Vote

    • Even Ballmer Wouldn't Do It

      Why would Microsoft want to do that? The margins in making and selling PC hardware are so bad that the world's largest maker of them wants to get out of the business. A previous "largest maker of them" saw it coming and got out a decade ago.

      Microsoft has a good thing going. They make a lot of money. The last thing they need is to invest their billions in a slow-growth business with razor-thin margins. As somebody above noted, they could get a higher return putting their money in a savings account.
      Robert Hahn
      Reply Vote

      • RE: Who should buy HP's PC division? Samsung? Lenovo?

        @Robert Hahn <br>I do not ask that Microsoft buy HP just to produce the same kind of PC that most other OEM are producing but to produce both high end and evolutionary type of PC. For example Microsoft could only keep the Elite book and the Envy series as Laptops models as they are quite high quality and appealing. By focusing on these models Microsoft could push to get higher volumes of the same components thus significantly lower price and enhance increase margin and possibly lower prices.<br>Isn't it what Apple do ?<br>Moreover with a PC hardware division Microsoft could come with some added value device taking full advantages of its O.S and its services.<br>For example a Windows 8 based slate which can be turned to either laptop or desktop with the right dock.<br>Because we all agree that most OEM can hardly come with inovative devices.<br>And if PC sales keep falling it will significantly impact Microsoft global margins soon or late.<br>Thus according to me Microsoft does not really have the choice in the matter.<br>Either they step in and produce revolutionary PC or they get ready to see the profits from PC sales keep falling.<br>People need PC but PC have become less and less appealing and seem to evolve much slower than other devices those last years.<br>Unless Microsoft manages to trigger a revolution with Windows 8, it doesn't look good.
        timiteh
        Reply Vote

    • An incentive for current MS partners to partner with Linux

      @timiteh Microsoft right now has to balance things out with other OEMs, the last thing the company wants to do is a Google/Motorola type deal and cause back lash. Microsoft has good relationship with all the major brands and system builders, competing against them is not good for business. Microsoft's success has been attributed to partners, you don't want to damage that. Apple can get away with it because that's how they have been since day one.
      adacosta38
      Reply Vote

      • RE: Who should buy HP's PC division? Samsung? Lenovo?

        @adacosta38
        They do not need to compete with other OEM just with Apple.
        Last time i check most OEM do not really compete in the high end market PC market but more in the low end and mid end PC market.
        Also there is a significant need of evolution in the PC market, with a PC hardware department Microsoft could be able to design and launch disruptive devices which can also serve as templates for other OEM.
        Again last time i chech OEM were not efficient at launching disruptives devices.
        And last but not the least if MS partners were able to launch successful Linux based it would have already been done.
        Netbooks were perfect for such a thing to happen.
        timiteh
        Reply Vote

    • It's easier to dominate the software market...

      @timiteh <br>...if you don't make hardware; instead supply system software for many different OEMs and make them compete for your favor (which is what MS has been doing since the 1980s).<br><br>If MS starts making their own computers, MS becomes a competitor to the other OEMs, who might just feel free to promote systems other than Windows ("Dell recommends Ubuntu", anyone?).<br><br>I'd love to see Steve Ballmer walk away from the business model MS has been following the entire time he's been with the company, but I don't think it's going to happen and from MS' point of view, it makes very little sense.

      Edit: Even if Ballmer wanted to make such a radical departure from the way MS has always done things (before DOS, MS did it with BASIC), he'd need permission from a board of directors headed by Bill Gates to do it. It's not going to happen.
      John L. Ries
      Reply Vote

  • RE: Who should buy HP's PC division? Samsung? Lenovo?

    how about Best Buy or Walmart ? either could instantly have a respectable line of laptops/desktops , obtain a 5 yr brand license , and increase its thin margins selling hardware.
    knic
    Reply Vote

    • Wow!! A suggestion that is not dumb ....

      @knic That is actually two companies that could potentially benefit from buying HP PCs. Both can achieve a lot better return on the razor thin market by having their own brand of PC, tablet, smartphone, etc. by not having to pay a middle men. In essence, they can sell directly to the consumer at lower prices and make more money than what they are making today.

      So your suggestion is actually a good one ..... compare to everybody else.
      wackoae
      Reply Vote

      • RE: Who should buy HP's PC division? Samsung? Lenovo?

        We don't know whether the idea is dumb or not, but it doesn't look good. Both those companies have tried to sell their own in-house iTunes competitor, and both did a face plant.

        The idea that there exist 'middlemen' who don't actually do anything except add superfluous cost is -- I hate to say this -- dumb. The electronics business is waaaaay too competitive for anyone to charge more to run a warehouse than running a warehouse is worth.
        Robert Hahn
        Reply Vote
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