H-P Buys Palm: It's All About Tablets

Hewlett-Packard's acquisition of Palm is about building a better iPad.
Author:
Publish date:

Hewlett-Packard

(HPQ) - Get Report

and

Palm

(PALM)

. Yes, it's a very big deal.

America's No. 1 computer manufacturer saves Palm

from the trash heap and in the process immediately puts itself into the red-hot super-smartphone business.

But there's something even more important than cell phones at stake here and that's the next "big thing" in computing.

It's no secret that H-P has been working on tablet computers for years, decades even. For the most part its tablets haven't gathered much momentum. Don't blame H-P though -- no one's tablet has captured the hearts and souls of American computer buyers.

But

Apple

(AAPL) - Get Report

has changed all that. Like it or not, the iPad has garnered a tremendous amount of attention and momentum even though it's nothing more than an oversized iPhone with a better processor.

With Wednesday's announcement, H-P now owns the rights to a fantastic, ready-made, multi-tasking tablet computing OS. Forget about the Pre and the Pixi. At least in the short run, H-P has its sights set on building a better iPad.

In recent weeks, we've seen stories about how H-P has secretly been working on a new tablet design. There have been whispers about whether it might run Windows 7 or some form of the Android OS or something else. There have been rumors that even in it early stages the H-P device was no iPad killer.

That's not something H-P really doesn't have to worry about any more. I expect that between the WebOS experts who haven't jumped ship and the large number of experts in the H-P labs that we're going to begin seeing a number of interesting new computing concepts very, very soon. As a matter of fact, I wouldn't be surprised if H-P hasn't begun working on it already.

I'm not forgetting about the phones. H-P shouldn't forget about them. The Pre and Pixi are good devices. Too bad Palm's marketing plan was a complete dud. That and the fact that Palm bungled getting a version to

Verizon

(VZ) - Get Report

before Verizon started releasing Android phones or a GSM version that could be used in every country on the planet.

I'm sure H-P won't make the same kind of marketing mistake. Before Roger McNamee and Elevation Partners took control of Palm, the company had a terrific marketing/press guru, who now just happens to work for H-P. I'm sure he still remembers where all the "dead bodies" are stashed. H-P would be nuts not to get some quick advice from its expert.

A new cellular handset might be a nice early step for the new H-P/Palm to make, maybe something with a larger screen (not as large as a tablet) with a terrific layout like the current Pixi. And it needs to make it a world phone so that buyers around the world have a chance to experience the terrific operating system.

As for more WebOS apps, if you build it they will come. When H-P starts to build new hardware there should be enough interest generated with the application-devising gurus to give the Palm store a large kick-start.

There are dozens (maybe hundreds) of Palm patents too. I'm sure that entered into the equation as well.

All in all, this is a great move for H-P and a win-win for consumers, more of whom need to experience a WebOS device. This also is great for Palm engineers who'll get another chance at bringing Palm products back to life.

Gary Krakow is TheStreet.com's senior technology correspondent.