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Technology Stocks : Hewlett-Packard (HPQ) -- Ignore unavailable to you. Want to Upgrade?

To: Kirk © who wrote (2040)	10/25/2002 2:00:32 PM
From: Dave B	Respond to of 4345

Kirk, I agree. Despite getting upset over how the CEO handled the merger and the teamwork of her Board of Directors (I was taught by HP that the buck stops with the project leader and blaming people under you is wrong) I think the Hackborn vision to merge with CPQ was essentially correct. They need the scale to compete with IBM and Dell but they also need to innovate if they are to remain a leader as only leaders seem to survive these days... just ask Jerry Sanders down at AMD how rough life is as a follower. I have to disagree about the CPQ acquisition. Dell grew to be the #1 PC supplier without acquisitions. They did it by building a new business model. And they're profitable with this model. HP didn't need to buy CPQ to build a new business model -- in fact, it's a diversion since CPQ didn't have the model HP needs either. Buying "scale" does nothing if they keep the same underlying model. They'll be #1 for a short period and then Dell will take over the spot again (as it appears they're already starting to do). They have to change the underlying way that they do business in commodity products if they hope to make any money on them. Otherwise, unless they can prove that there is some carry-over to other businesses, they should jettison their money losing businesses, not merge them with money-losing businesses from other companies. The whack they need is more than just an acquisition. JMO, Dave