HP to acquire Palm for $1.2 billion

HP has announced plans to purchase Palm for a cool $1.2 billion.  Few additional details are available at the moment, but HP will be conducting a live audio webcast at 2:00pm PDT to discuss the acquisition. Based on this snippet from the official press release, it looks like HP is keen on using Palm’s webOS for smartphones and potentially other devices.

“Palm’s innovative operating system provides an ideal platform to expand HP’s mobility strategy and create a unique HP experience spanning multiple mobile connected devices,” said Todd Bradley, executive vice president, Personal Systems Group, HP. “And, Palm possesses significant IP assets and has a highly skilled team. The smartphone market is large, profitable and rapidly growing, and companies that can provide an integrated device and experience command a higher share. Advances in mobility are offering significant opportunities, and HP intends to be a leader in this market.”

HP has employed Microsoft’s Windows Mobile platform in the past, but with the Palm acquisition, it may have no need for Redmond’s upcoming Windows Phone 7 OS. Or Android, for that matter.

Early reports suggest that HP’s Slate alternative to the iPad will run Windows 7 Home Premium. That OS choice makes sense given the Slate’s netbook-class Atom underpinnings. However, with webOS at its disposal, HP will have considerable flexibility when developing other "mobile connected devices." WebOS supports true multitasking, as well, making it a particularly intriguing alternative to the iPhone OS for devices that blur the line between smartphones, PDAs, and netbooks.

Comments closed
    • no51
    • 12 years ago

    Well, they are pennies… just a whole lot of them.

    • ronch
    • 12 years ago

    It amazes me how much money these big companies can just throw around like they’re pennies.

    • Ronald
    • 12 years ago

    I’ve dealt with racial stuff, but this is the first time I’ve had my gender openly questioned on this site.

    • Da_Boss
    • 12 years ago

    I think HTC really missed out on a great opportunity to pick up a mobile force like Palm. Even though they weren’t selling great, their patents and OS tech alone make them a worthy buy. It would’ve been nice to see HD2-like hardware running webOS.

    I guess an IPAQ running webOS will have to do ๐Ÿ™

    • sluggo
    • 12 years ago

    Good info on the purchase price, and I agree – the one thing Palm needed was an infusion of cash. The perception that you won’t be around in a few years is the absolute kiss of death for tech acceptance. Now that the doubt has been removed, it’ll be fascinating to watch the battle. All the biggest players in the business fighting over the same space. Yowza.

    BTW, ProCurve was not an acquisition, but is HP’s name for its internally-developed networking products. The 3Com acquisition is HP’s first purchase in the networking space and was a simple acknowledgement that ProCurve could not compete for big deals against the big boys.

    • thecoldanddarkone
    • 12 years ago

    I own one and know a few others that do. They are few and far between.

    I’ve had my pre plus for about 50 days now. It’s not perfect, but I like it. Without a doubt my blackberry did messaging and email better. The pre does email fairly well just not as good as my bb did.

    • _Sigma
    • 12 years ago

    I would assume sarcasm. I think (s)he is getting at this being a losing proposition for HP.

    • bwcbiz
    • 12 years ago

    Not sure where you’re getting that. Nothing like that in the analyst estimates, in fact most earnings estimates have been revised upward in the past 30 days. Have a source for that figure?

    • bwcbiz
    • 12 years ago

    At least under Mark Hurd it has. Fiorina couldn’t really get the Compaq merger to work.

    Considering that the price HP paid was basically 1 Q of cash flow, it’s a big, but not a major acquisition. I suspect this is just their initial entry into the market, the way they first bought ProCurve and then 3Com in networking. Hurd seems to like to grow into markets by acquisition.

    • Corrado
    • 12 years ago

    They took FAR too long to get a real successor to PalmOS out the door. Their WinMo (particularly the Treo Pro) phones were nice, but also-rans. Nothing differentiating them from the pack. The 650-755 Treos form factor was so abysmal by the time they stopped making it that it was almost laughable. The Centro was OK, but in the face of the iPhone, and ever more capable feature phones, it was severely lacking.

    • StashTheVampede
    • 12 years ago

    Wouldn’t it have been easier to get HTC to build a phone with Android on it?

    My guess is they want a full court press with a phone/OS/marketplace combo that has legs and isn’t tied to Google or Apple. Not a bad strategy, but only time will tell.

    I also don’t know a single person with a Palm Pre.

    • thecoldanddarkone
    • 12 years ago

    They have been halfway in for a long time, appearantly they are going to jump in with both feet.

    • StashTheVampede
    • 12 years ago

    HP, please release BeOS source, thanks.

    HP is now tossing themselves into the ring of any device that can run WebOS. Why? Do they honestly want to get into consumer devices such as smart phones or tablets? Even if they did want to get into this market, they have plenty of vendors to pick from (HTC, Android, etc).

    • highlandr
    • 12 years ago

    Kinda like how well they took care of Alpha?

    • mtizzle
    • 12 years ago

    Not too mention with Palm’s IP they are now immune to lawsuits from Steve Jobs

    • Corrado
    • 12 years ago

    They will now. But they may not in the future. WebOS is Linux based, so it could easily be modified to scale to fit on a 5+” screen with a more robust web browser and a slightly modified UI.

    • NeelyCam
    • 12 years ago

    Intel should buy GlobalFoundries.

    • Meadows
    • 12 years ago

    Man of few words, aren’t you. </Alyx>

    • sluggo
    • 12 years ago

    And who was CEO at Palm in 2005? None other than the above mentioned Todd Bradley, owner of the largest supply chain in the IT industry. I’m guessing he knows a little bit about what he’s buying.

    Should be a nice party at Todd’s place for the Palm team.

    • dmitriylm
    • 12 years ago

    LOL

    • thecoldanddarkone
    • 12 years ago

    Huh? HP states that it will still makes MS handsets…

    • Ronald
    • 12 years ago

    This deal allows HP to wean itself away from Microsoft. In the long run, HP can save money because it no longer has to pay royalties to Microsoft for using Windows Mobile. So overall, this is not good news for Microsoft.

    • ludi
    • 12 years ago

    Updated headline:

    “HP to relieve itself of excess money by burying it in a couch cushion”

    • Saber Cherry
    • 12 years ago

    If you can’t build a mobile OS for $1.2 billion, you should not be considered a viable tech company. Of course… I have not considered HP to be a tech company since Fiorina finished with it. Nowadays, they’re more of a Dell – just slapping together other people’s products and selling them under their own brand name.

    • no51
    • 12 years ago

    l[

    • adam1378
    • 12 years ago

    HP have its slate with WebOS as the operating system would be interesting. Coincidentally, today I had to take my Palm Pre to get it fixed.

    • DrDillyBar
    • 12 years ago
    • axeman
    • 12 years ago

    While I’ve heard they’re showing signs of life lately, I’m surprised they’re still worth that much.

    • bdwilcox
    • 12 years ago

    Wonder if HP will open-source BeOS to the community?

    • dpaus
    • 12 years ago

    Their technology has been great, their marketing awful (kinda like the opposite of Microsoft) – see my comment from earlier today in Shortbread. As long as HP cleans that up, they have a bright future.

    • puppetworx
    • 12 years ago

    This is a steal for HP. Palm’s current technologies are hugely promising and they are as innovative as ever. I hope HPs money and experience can deliver the best of Palm’s creativity into the marketplace in a big way.

    • potatochobit
    • 12 years ago

    hasn’t palm been in a death spiral for awhile now?

    letting them operate independently is a bad idea in my opinion
    HP does not need any added costs/loses
    with all the new contenders for market share they should focus on what they do well

    • Kurkotain
    • 12 years ago

    now intel has to buy nvidia and i can call it a day….

    • dpaus
    • 12 years ago

    HP’s acquisition track record has been pretty good

    • Kunikos
    • 12 years ago

    Not a new trend at all. Unless that was sarcasm?

    • pogsnet
    • 12 years ago
    • SomeOtherGeek
    • 12 years ago

    Again, good point.

    • SomeOtherGeek
    • 12 years ago

    Good point.

    • dpaus
    • 12 years ago

    They’re going to continue to operate as an independent business unit, so no different than when they were purchased by U.S. Robotics back in 1997 – who, ironically, were then bought by 3Com, who were then bought by… HP ๐Ÿ™‚

    • dpaus
    • 12 years ago

    While I would rather have seen RIM pick them up, this is a good match-up.

    • RumpleForeSkin72
    • 12 years ago

    like someone said in an earlier post, Palm Inc has a pretty substantial IP/patent catalog to play with.

    Palm OS was pretty robust considering it was running on a Casio calculator-watch (the buttons.. how can I do math on this?!?!?) . I’m pretty sure that if Apple didn’t step up with the iPhone the iPod (to an extent) that Palm wouldn’t have gone down the tubes to far.

    After using a Palm for years, I got so used to writing in that style that when I came upon a situation that required a handwritten note, I seemed to have lost 16+ years of education and my mastery of the written language heh.

    • dpaus
    • 12 years ago

    Palm’s patent portfolio alone is worth that much….

    • RumpleForeSkin72
    • 12 years ago

    I’m rocking a x3715 myself! I love it, funny thing is that I’ve been reading books on PDAs since Palm Inc was still relevant on a Sony Clie until it just went tit’s up.

    Oh yeah.. I can listen to music AND read a book on it at the same time.. what do you say about that Apple.. My PDA is damned near 7 years old at this point and has a camera, wifi, and some level of multitasking ( whether fake or not it’s still functional)

    • Hattig
    • 12 years ago

    If they’ve seen Windows Mobile 7 and then decided to buy Palm, that doesn’t bode well for Microsoft…

    Palm will come with a raft of patents though, enough to allow HP to defend its mobile device corner. It will be interesting what they plan to do with the company in order to maximise on their investment. They might just want an alternative product to Dell’s upcoming Android phones.

    • Helmore
    • 12 years ago

    That’s what I thought as well ๐Ÿ˜€

    • bLaNG
    • 12 years ago

    yeah! yeah! yeah! hp! yeah! Still have their HX4700, works like a charm, best PDA ever. Now Palm gets very interesting for me.

    • Ronald
    • 12 years ago

    It’s a lot cheaper than HP building its own mobile OS (and maybe they don’t want to wait until the end of the year for Windows Mobile 7.)

    • SomeOtherGeek
    • 12 years ago

    1.2 billion? HP must be bored or something.

    • Ronald
    • 12 years ago

    Additionally, Palm has lowered its fourth quarter outlook by 42% due to falling sales.

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    • tesla120
    • 12 years ago

    RIP Palm.

    • Farting Bob
    • 12 years ago

    $1.2bn for a company circling the drain with seemingly little hope of recovery? Seems alot. I cant see any promising stuff in the pipeline from palm to suggest they will be able to claw back any market share whilst making a profit.

    • khands
    • 12 years ago

    Gotta say, I didn’t see this matchup coming.

    • TurtlePerson2
    • 12 years ago

    What a coincidence. Damage said that there wouldn’t be any news post short of a big acquisition.

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