HP to refocus on organic development

HP’s newly installed CEO, Leo Apotheker, has taken a “brave new approach” with the company, which this week posted a five per cent increase in earnings year on year. Whereas former CEO Mark Hurd made HP an efficient technology company by reducing the cost of doing business as well as R&D spend, Apotheker has vowed to increase organic development initiatives.

According to Roy Illsley, principal analyst at Ovum, this new emphasis on finding the future revenue streams from within makes sense. Bu he warns: “HP has a great deal of talented people, but spending on R&D alone is not a guarantee of success. HP must also adopt new management processes to foster innovation and embrace an entrepreneurial culture if it is to succeed.”

This could be good news for Palm, which was recently acquired by HP, and released version 2.0 of its webOS platform in October. The US manufacturer picked up the struggling handset vendor for $1.2bn in cash in April and has said it intends to heavily invest in the webOS platform, developing software and hardware products from smartphones to slate PCs and netbooks.

Former Apple heavyweight Jon Rubinstein joined Palm as executive chairman in 2007, and assumed the role of CEO in June 2009. He was instrumental in turning Apple’s fortunes around in the late 90s, and was also the visionary behind the original iPod. Analyst house Informa Telecoms & Media believes that it is important for HP to retain Rubinstein and keep him at the forefront of the development of webOS.