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Technology Stocks : HWP -- Hewlett Packard -- Ignore unavailable to you. Want to Upgrade?

To: FR1 who wrote (3743)	12/10/2001 3:11:48 AM
From: Elroy	Read Replies (1) \| Respond to of 4722

I mean, if we were to paint a picture of what HP has for its growth going forward, what is that picture? Sell off the PC business to whoever will take it. Sell the server and storage business to whoever will suffer with it. Sell the printer/cartridge division for a premium price to whoever wants it. And cease to exist!

To: FR1 who wrote (3743)	12/10/2001 3:01:22 PM
From: Oeconomicus	Read Replies (2) \| Respond to of 4722

The question that comes to mind is what will be the future of HP? First, let me tell you what HP should NOT do: HP should NOT exit the PC business. If they did so now, they'd be exiting right at the bottom of the market, so they'd never be able to sell it for any material sum - instead, they'd consume cash shutting it down. Bad idea. That's not to say it's worthless, though. HP has a strong consumer PC brand name and that business will come back - it's cyclical, not dead. Where HP lacks, IMO, is in marketing to small/mid-sized businesses (and more sophisticated consumers). This, IMO, is due to their poor direct sales efforts, including both their advertising and their online shopping site. Just because no one has been able out-Dell Dell doesn't mean it can't be done. The Dell approach is the way to go in this part of the market. What's more, HP has the financial strength to be a survivor while others seen more likely to just fade away. GTW has stalled and is losing altitude fast. And Compaq? Who? HP's competitive position in PCs is only going to get stronger. What else should they do? 1) Let the Compaq deal go to a shareholder vote, but first make sure the votes are lined up to kill it. This is a classic 2+2=3 (at best) merger. Let us shareholders put it out of our misery. 2) Stop treating software as if it were some freebie that helps you sell boxes. HP keeps buying software businesses and then not selling their software except as a way to get people to buy HP hardware. Acquisition and development dollars are wasted because good products are limited a) to an addressable market consisting only of HP hardware customers and b) to being sold primarily by hardware salesmen, with little in the way of marketing resources devoted to the software products themselves. 3) Continue building (rather than trying to buy all at once) the services business. Both the PWC and CPQ deals were driven, at least in part, by Carly's stated objective of building services revenue. IMO, services business will grow if they have strong (but somewhat separate) hardware and software businesses. If an opportunity comes along to acquire services revenue through one or more smaller deals, fine, but no more deals that drive headlines and executive bonuses instead of driving revenues, profits and company-wide bonuses. 4) Continue to milk the printing and imaging cash cow and continue to innovate to extend the life of the cow. If we are ever going to see a paperless office (and I have my doubts that we ever will), then make sure that it is HP products that replace the paper. In any case, even if we do achieve the paperless office, the paperless home is much farther off. Then there's imaging - that's still just a calf. 5) Sell off Carly's jets to Warren Buffett. I hear those things are actually appreciating in value these days. 6) Wish Carly a happy life in retirement and find a strong, but low-profile leader to replace her as CEO. Preferably someone from the inside, but at least one who won't cost $80 million+ to hire. JMO, of course. Bob