Both companies have been strong in the era of PDAs. You remember, those smartphones without a phone. The market of PDAs peaked in 2005 and after that it has been vanished. Those companies have something in common in the past.
Hewlett Packard has been in the mobile handset business before, but not for too long. HP failed to note the move from PDAs to phones and put a calling capability into its devices only 2007. Since then it has been selling HP iPaq phones without remarkable success. Actually, the sales has been falling fairly fast during recent quarters. Why HP has not been using it strengths to gain sales of its own Windows-powered iPaq phones?
But HP is a huge company. It has vast resources and market presence everywhere, and PALM has a nice new operating system. Sales organizations are in shape, technical support has already been helping customers for ages. There is a huge opportunity to utilize the PALM technology and knowledge on mobile through these strengths. True.
But HP is a huge company. Annual sales is well above $100 Billion. PALM sales are below $1 Billion and falling. How much time HP management has to spent with their new acquisition? Just looking at those sales numbers, the answer is "Not too much really". HP may just use PALM as a source of technology. Pick the tech to its products and forget the PALM phones and brand.
Historically two thirds of the mergers and acquisitions fail. Hope you all the best and lots of luck HP and PALM, because odds are not on your side. Work hard, work really hard to understand where you are heading and what is the direction of the mobile businesses.
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