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HP May Not Spin Off PC Business: Report

Hewlett-Packard executives reportedly are rethinking the controversial decision to get rid of the company s $41 billion PC business. Rather than spin it off into its own company or sell it, HP may end up keeping the Personal Systems Group, according to an Oct. 12 story in the Wall Street Journal, citing people familiar with […]

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Channel Insider Staff

Oct 12, 2011

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Hewlett-Packard executives reportedly are rethinking the controversial decision to get rid of the company s $41 billion PC business.

Rather than spin it off into its own company or sell it, HP may end up keeping the Personal Systems Group, according to an Oct. 12 story in the Wall Street Journal, citing people familiar with the matter.

New CEO Meg Whitman is reviewing the company’s recent moves under her predecessor, Leo Apotheker, who was fired in September after less than a year on the job. Among the criticisms of Apotheker were some jarring changes in strategy, and then reversals of some of those decisions.

Apotheker in August announce his intentions to remake HP into a company more focused on enterprise services and software and less dependent on low-margin hardware sales. He outlined a plan to spin off the market-leading PC business, to end development of mobile devices in particular smartphones and tablets running the webOS operating system, and to buy software maker Autonomy for $10 billion.

The moves drew mixed reviews, though analysts were not surprised by Apotheker’s decision, given his deep background in software. He was CEO of software giant SAP before being fired from there in early last year. Some analysts argued that the moves would make HP a more competitive company, while others said that HP risked losing a good chunk of its customer base and supply chain advantages.

Upon taking the reins at HP, Whitman–the one-time eBay CEO who was a member of HP’s board of directors–said she believed in the direction HP was heading under Apotheker, though she questioned the execution. She also said she would review every facet of the company, leading some to believe that she could reverse the decision on the PC business.

Earlier this month, Whitman said she expected to move up the timeline for making a decision, from December to October, though admitted that it could take longer than this month. A quick decision on the fate of the PC business would help HP stave off rivals who are looking to poach customers from the tech giant.

To read the original eWeek article, click here: HP May End Up Keeping PC Business: Report

HP May Not Spin Off PC Business: Report

Channel Insider Staff

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