A couple months ago, Hewlett-Packard announced it might spin off its PC business.
Last year, the PC business contributed about $40 billion of HP’s total $126 billion in sales, and $2 billion of its $8.8 billion in net profit.
And as competitor Michael Dell pointed out, having a big PC business helps keep component costs down for the faster-growing server hardware business.
But the entire idea of spinning off the PC business never made much sense in the first place.
Apotheker’s master plan was to make HP look a lot more like IBM, with most of its revenue coming from big-iron hardware, enterprise software, and consulting services. IBM sold its PC business to Lenovo in 2005, and has never looked back.
But as Ars Technica’s Sean Gallagher pointed out in a scathing editorial yesterday, HP doesn’t have enough of its own enterprise software to mimic IBM’s strategy. The only way it could get there is through more acquisitions, but Whitman has said that she’s hesitant to go that route.
HP is also too dependent on other companies’ software, which can create headaches — like when Oracle recently dropped support for HP-UX (HP’s version of Unix) on Intel’s Itanium platform.
So perhaps the best option for HP is to keep plugging along with the businesses it DOES have, and try to make those businesses perform better by keeping a tight rein on margins. Sort of like Mark Hurd was doing before he got fired.
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