Page 23 - ATD 31OCT2015

TECHNOLOGY A23
Saturday 31 October 2015

HP, a Silicon Valley icon, is ready for its break-up

BRANDON BAILEY In this Sept. 17, 1993, file photo, David Packard, right, co-founder of the Silicon Valley computer company Hewlett-Packard, an-
AP Technology Writer nounces his retirement as chairman during a news conference at HP’s headquarters in Palo Alto, Calif. Packard, 81, started the
SAN FRANCISCO (AP) — company in 1939 with William R. Hewlett, who listens at left. Hewlett-Packard, one of the nation’s most storied tech companies will
One of the nation’s most split in two this weekend of Oct. 31, 2015, another casualty of seismic shifts in the way people use technology and big-company
storied tech companies will sluggishness in responding.
split in two this weekend,
another casualty of seis- Associated Press
mic shifts in the way people
use technology — and big- evolving market,” Whitman Enderle, a longtime industry zon and others. Along with external pres-
company sluggishness in told an investor confer- analyst. “It’s not clear what The same trends are rock- sures, HP has struggled with
responding. ence last month. “With less HP is anymore.” ing other long-time tech internal problems — a se-
Hewlett-Packard was an to focus on,” she added, giants. Microsoft has been ries of controversial CEOs,
early pioneer of what be- “each company will do Each of the spin-offs will forced to change the way botched acquisitions and
came the model for Silicon core things better.” face significant challenges: it sells software, as fewer scandals involving top ex-
Valley startups: Founded Demand for PCs and print- people buy PCs that run ecutives and directors.
in 1939 by two Stanford By dividing HP into roughly ers is continuing to decline, its Windows operating sys-
graduates in a Palo Alto, equal halves, analysts esti- as more people use mo- tem. PC-maker Dell is shift- Critics still debate the wis-
California, garage, HP was mate, each spinoff should bile devices and store their ing its focus to corporate dom of an earlier decision
long celebrated for its en- produce more than $50 documents and photos data centers, paying $67 to spin off a unit that made
gineering know-how and billion in sales next year. online in the cloud. And in billion to acquire commer- scientific testing and mea-
laid-back corporate cul- But skeptics say neither will the commercial comput- cial computing giant EMC surement gear. That was
ture. It made hefty profits have the clout of the old ing sector, more businesses Corp. HP’s original, and some
as it grew into a multina- HP, which became a lead- are using online software believe its most innovative,
tional giant that sold a ing consumer brand while instead of buying servers IBM, meanwhile, has sold business. It became Agilent
wide range of computer using its vast size to negoti- and other hardware from off units that made per- Technologies in 2000.
gear and commercial tech ate volume discounts with companies like HP. sonal computers, servers As for the new spinoffs, For-
services. suppliers and big contracts HP recently said it’s giving and microprocessors as rester’s Burris said he’s not
But after struggling to keep with business customers. up on competing directly in profits declined in each. ready to count them out.
pace with recent trends “They won’t have the im- cloud computing, a grow- It’s investing in new sectors “It’s reasonable to think
like the rise of smartphones pact that HP once had, ing business in which com- with more growth poten- both can be thriving com-
and cloud computing. HP’s now that they don’t have panies large and small run tial, such as data analytics, panies, but a lot will come
board decided last year to the depth of portfolio they software in remote data cybersecurity and cloud down to the quality of their
create two smaller compa- once had,” predicted Rob centers operated by Ama- computing. management.”q
nies, each with a narrower
focus.

HP Inc. will sell personal
computers and printers;
Hewlett Packard Enterprise
will sell commercial com-
puter systems, software
and tech services. Starting
Monday, each will trade
separately on the New York
Stock Exchange.
The old HP “missed the
emergence of the Web,”
said tech analyst Peter Bur-
ris at Forrester Research.
“They missed the emer-
gence of mobile.”
HP’s current chief execu-
tive, who pushed for the
split, says the new spinoffs
will be more nimble. CEO
Meg Whitman will run HP
Enterprise, while PC indus-
try veteran Dion Weisler will
lead HP Inc. Each will be in-
dependent, with “flexibility
to respond to a constantly