HP CEO Meg Whitman says Microsoft is becoming an outright competitor

By on October 10, 2013, 3:30 PM

HP was one of the few that applauded Microsoft for taking initiative and building their own Windows 8 tablet in 2012. Executive John Solomon said he believed Redmond was making a leadership statement by showing what is possible in the tablet space. But now just a little over a year later, that’s all changed as the two companies are transitioning from partners to outright competitors according to CEO Meg Whitman.

During HP’s recent annual financial meeting, Whitman said Wintel-based devices (Windows / Intel) are being displaced by ARM-based PCs and mobile devices. PC sales continue to slide while mobile devices like tablets are on the rise, she noted.

To that end, HP has been working more with partners like Google to produce Chromebooks. The most recent effort was unveiled just a couple of days ago – the Pixel-inspired Chromebook 11 powered by Samsung’s dual-core Exynos processor.

It’s all a bit ironic as HP may have been directly responsible for Microsoft building Surface hardware in the first place. Last year, the New York Times ran a story that claimed Microsoft was unhappy with HP using inferior parts in their failed Slate 500 tablet. Executives reportedly found the tablet was thick and the Intel processor made it run hot. What’s more, the software and touch screen didn’t work well together. The rest, as they say, is history as Microsoft's second generation tablet is scheduled to launch on October 22.

A host of manufacturers voiced their concern about Surface before its launch. For example, Acer said they were given little warning of Microsoft’s intentions and believed launching it would have a negative impact on the worldwide computer ecosystem.




User Comments: 13

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1 person liked this | coppersloane coppersloane said:

So, what is Microsoft supposed to do? Hold back on innovation to appease other manufacturers? Hold back so these other companies can stay comfy? Screw that. Microsoft has always had the power to innovate and change the way we compute, for better or worse, and now finally they're making it their priority. And they should. Every company should have exactly the same outlook on tech. Apple certainly does.

Vrmithrax Vrmithrax, TechSpot Paladin, said:

Microsoft has made no secret of its intended transition into a "device and services" type of company... So I'm not understanding how this comment by HP is anything but stating the obvious?

cliffordcooley cliffordcooley, TechSpot Paladin, said:

All I'm gonna say is there must be too many players in the field. If HP is the one feeling most of the heat, then they must be the ones that need to go, if they can't keep up.

Archean Archean, TechSpot Paladin, said:

HP haven't offered any compelling windows notebook in a while, even my current DV6 6011 feels 'overweight' ...... and the display is just bearable. So I think HP's decline has more to do with their own stupidity in not reading the market and not bringing out the devices which people like.

ikesmasher said:

So, what is Microsoft supposed to do? Hold back on innovation to appease other manufacturers? Hold back so these other companies can stay comfy? Screw that. Microsoft has always had the power to innovate and change the way we compute, for better or worse, and now finally they're making it their priority. And they should. Every company should have exactly the same outlook on tech. Apple certainly does.

I wouldnt throw the word innovate around so much.

Then again, hardly anyone else seems to know what it means, so you're fine

Guest said:

> So, what is Microsoft supposed to do? Hold back on innovation to appease other manufacturers?

How about not screwing them over in the first place. Microsoft were charging OEMs for a full copy of windows for each Windows 8 tablet they sold, yet was effectively free when they sold one themselves. But that was okay, Ballmer told the OEMs that Microsoft was only going to sell them in Microsoft storefronts.

When he reneged on that promise and began selling Microsoft tablets in big box stores, the writing was on the wall when you compare how much an OEM has to pay for a tablet that ships with a copy of Android, that requires a much cheaper BoM to build, versus Windows and its license fee, which the market has shown almost nobody wants anyway.

If Microsoft had wanted to use their Windows OEM ecosystem they had invested years into building wisely, they would have subsidized Windows 8 licenses to OEMs so they could compete with Android based tablets in spite of Windows bloated requirement for flash, ram, and cpu, until such time that the base of Windows metro apps was enticing enough for the product to survive by itself. But they didn't and the OEMs were forced to cheap out on things like screen quality and battery life just to break even. Then Ballmer shafted them by moving to retail anyway, because it wasn't the runaway success they'd demanded it would be.

Meanwhile IOS and Android are eating Microsoft's lunch while Ballmer wails that the maligned Windows 8 excuse for a user interface is just being misunderstood, but hey, its all okay because Microsoft is now vertically-integrated (products and services) company simply because he said so, and they don't need their OEM ecosystem anymore. And you're surprised when the likes of Meg Whitman flip Ballmer the bird and Ballmer resigns to leave the mess for someone else to clean up.

1 person liked this | NoLimits NoLimits said:

> So, what is Microsoft supposed to do? Hold back on innovation to appease other manufacturers?

How about not screwing them over in the first place. Microsoft were charging OEMs for a full copy of windows for each Windows 8 tablet they sold, yet was effectively free when they sold one themselves. But that was okay, Ballmer told the OEMs that Microsoft was only going to sell them in Microsoft storefronts.

When he reneged on that promise and began selling Microsoft tablets in big box stores, the writing was on the wall when you compare how much an OEM has to pay for a tablet that ships with a copy of Android, that requires a much cheaper BoM to build, versus Windows and its license fee, which the market has shown almost nobody wants anyway.

If Microsoft had wanted to use their Windows OEM ecosystem they had invested years into building wisely, they would have subsidized Windows 8 licenses to OEMs so they could compete with Android based tablets in spite of Windows bloated requirement for flash, ram, and cpu, until such time that the base of Windows metro apps was enticing enough for the product to survive by itself. But they didn't and the OEMs were forced to cheap out on things like screen quality and battery life just to break even. Then Ballmer shafted them by moving to retail anyway, because it wasn't the runaway success they'd demanded it would be.

Meanwhile IOS and Android are eating Microsoft's lunch while Ballmer wails that the maligned Windows 8 excuse for a user interface is just being misunderstood, but hey, its all okay because Microsoft is now vertically-integrated (products and services) company simply because he said so, and they don't need their OEM ecosystem anymore. And you're surprised when the likes of Meg Whitman flip Ballmer the bird and Ballmer resigns to leave the mess for someone else to clean up.

Okay Mr. Guest, let me eat up your response. This is capitalistic world.

How is Microsoft screwing these other Manufacturers? By giving them opportunities to make PC's? Do you realize Apple doesn't give any OEM the opportunities. They are eating away at Microsoft's personal computing numbers. Microsoft actually allows the MFG's to compete instead of making their own, most likely better, product in each space.

Apple makes their own phones, tablets, computers, music players....EVERYTHING. Why the hell aren't people complaining about that?

GTFO Microsoft's case, they SHOULD start controlling the supply chain better and get us better PC products, after all, it is their image these OEM's represent. Even if it is a Dell, HP, Acer, or Lenovo we still recognize it as a Windows PC. Crappy and slow hardware on certain OEM's can make somebody have a bad WINDOWS experience (EX: Hdd's versus SSD). And that's the truth.

Microsoft was charging for a copy of Windows? Software they spent millions in developing? Crazy thought. It was free when they sold one themselves? They paid millions to develop it. They control the entire supply chain. It's called vertical integration.

There is no difference here between Apple and Microsoft in this case. Shoot Microsoft buys hardware from other MFGs. Apple makes their own at the Foxconn plants.

Why is there nothing wrong in either case? There are choices for us consumers to make. There is no monopoly here. The OS space is getting more competitive by the year.

Guest said:

> How is Microsoft screwing these other Manufacturers? By giving them opportunities to make PC's? Do you realize Apple doesn't give any OEM the opportunities.

So your argument is that Apple is bad for being vertically-integrated, but Microsoft is wonderful because, they are going that way now too? Let me know how surprised you were when Microsoft bought Nokia, and when Microsoft buys a newly-taken-private Dell and tries to turn into Apple Mk. 2 across their entire product line. And stop selling OEM licenses to the public in all likelihood.

So anyway, what part of Ballmer promising not to shaft OEMs in the retail space, and then going and doing exactly that, behind their backs while they had their own products in the manufacturing pipe, was a good idea for anyone? Other than Ballmer's next quarterly earnings report to shareholders?

> Crappy and slow hardware on certain OEM's can make somebody have a bad WINDOWS experience

Yes, and perhaps subsidizing licenses to make Windows less of a money sink for OEMs, rather than lumping them with both the full cost of the OS and the cost of the extra hardware required to run it versus what IOS or Android requires, might have worked out better for everyone, even Microsoft had they given the Metro apps library time to mature.

> Microsoft was charging for a copy of Windows? Software they spent millions in developing? Crazy thought.

I know Techspot is full of the MS/Intel/Nvidia-loving crowd, but OEMs do actually desire to ship desirable, useful products people want to buy. They've been hamstrung in the Windows space by both Microsoft and Intel for years dictating how to price and sell product, and have now turned to Android and ARM where, surprise surprise, they can make money. Meanwhile Intel and Microsoft are being shown up for what they always were. So if everyone has bitter memories of the crap sold as PCs in the last few years, perhaps simply blaming the OEMs is short-sighted?

> This is capitalistic world.

Yep, and I'd rather be the head of Asus right now, shipping Nexus 7's in volume for Google, than Ballmer's replacement.

Vrmithrax Vrmithrax, TechSpot Paladin, said:

I wouldnt throw the word innovate around so much.

Then again, hardly anyone else seems to know what it means, so you're fine

Well, technically the whole revamping to live tiles Metro / Windows 8 interface was quite a bit of user interface innovation, as well as the Surface form factor w/ kickstand idea, and the click-on keyboards...

Innovation doesn't have to be good, or even accepted by users, to count as innovation.

NoLimits NoLimits said:

>

>So your argument is that Apple is bad for being vertically-integrated, but Microsoft is wonderful because, they are going that way now too? Let me know how surprised you were when Microsoft bought Nokia, and when Microsoft buys a newly-taken-private Dell and tries to turn into Apple Mk. 2 across their entire product line. And stop selling OEM licenses to the public in all likelihood.

My argument is simple. Apple is taking away market share -- in the personal computing world -- every year. Their brand is getting stronger and stronger. Microsoft needs to compete. To do so, they need to offer a product that delivers the precise Windows Experience they want. In terms of ease-of-use, QUALITY, and other factors.

Of course the Metro OS has a long way to go. I agree the Windows Experience is of course mostly the OS, but I am saying the hardware can definitely affect the OS' performance. Some of these MFG's make real cheap and crappy PC's and it gives a bad WINDOWS impression. The cool thing, MSFT actually allows these MFG's to sell their software. I don't know what mandates that they have to do it though? Oh wait they got nailed with an anti-trust law suite over pairing Windows with IE...if they couldn't do that (pair windows with IE), obviously they couldn't do what Apple does and control the entire supply chain.

What does that mean? Because they were always on the brink of being a monopoly, they had to build out their OEM network to give others a piece of the pie. So we have grown up in a world where we are used to Microsoft not directly making the devices that runs its OS. However, times have changed and there are more and more OS' coming into fruition every year.

They should keep selling their OS' to other MFG's so that they can try and capture markets for PC's that MSFT is not going after. I am not saying cut out any of the OEM's, but expecting Microsoft to not have a physical product in this competitive space is just foolish.

Times have changed and now Microsoft needs to continue to compete instead of falling behind.

>So anyway, what part of Ballmer promising not to shaft OEMs in the retail space, and then going and doing exactly that, behind their backs while they had their own products in the manufacturing pipe, was a good idea for anyone? Other than Ballmer's next quarterly earnings report to shareholders?

Agreed it was a stupid move by Ballmer. He is on his way out and not the future of MSFT.

>Yes, and perhaps subsidizing licenses to make Windows less of a money sink for OEMs, rather than lumping them with both the full cost of the OS and the cost of the extra hardware required to run it versus what IOS or Android requires, might have worked out better for everyone, even Microsoft had they given the Metro apps library time to mature.

You are comparing apples versus oranges. You cannot compare Windows licenses for desktop PC's to tablet and smart phone OS licenses. Tablets/smart phones are not desktop or laptop computers, don't mix the two. I can't actually be productive at work, game, or power surf the web on a tablet/phone. The Android OS is much less complex and robust than Windows.

>I know Techspot is full of the MS/Intel/Nvidia-loving crowd, but OEMs do actually desire to ship desirable, useful products people want to buy. They've been hamstrung in the Windows space by both Microsoft and Intel for years dictating how to price and sell product, and have now turned to Android and ARM where, surprise surprise, they can make money. Meanwhile Intel and Microsoft are being shown up for what they always were. So if everyone has bitter memories of the crap sold as PCs in the last few years, perhaps simply blaming the OEMs is short-sighted?

I am not saying that they don't desire to make quality products. However, because of how they can buy MSFT's OS and then pair it with crap hardware, the end-user who receives that computer is going to think poorly upon MSFT and that MFG. You can't buy cheap, low-end Apple products. They offer a consistent experience all across the board and that is why they are gaining so much ground.

Surprise, surprise, that is what Android is doing as well. The difference is they have not released their chromeOS and so we can only compare MSFT to Google in the Phone/Tablet space.

>Yep, and I'd rather be the head of Asus right now, shipping Nexus 7's in volume for Google, than Ballmer's replacement.

I'd rather run the company that controls the business world. The business world NEEDS technology, and Microsoft offers world class technologies to help businesses compete. I'd rather run the company that Asus, Acer, HP, and Dell all complain to for controlling the entire supply chain.

Moderator note: NoLimits, if you are going to use the quote function, please do so properly.

NoLimits NoLimits said:

I take that back the Chromebooks do use the Chrome OS, but it still is not good for power users. The functionality of the Chrome OS will need to come really far if it is ever to be compared to the functionality of Windows for power users.

coppersloane coppersloane said:

You lost me at the OEM argument. Consumers are the new focus, and consumers don't care about your OEM argument.

coppersloane coppersloane said:

You're right, and I'll make a preliminary list off the top of my head.

1) Interface: turning the Start menu into a full-fledged tile spread (this one really has stupid people boggled)

2) Swipe functions for opening and closing apps (also has stupid people whining 'It's too difficult to understand!'

3) split-screen functionality for multi-tasking

4) kickstand

5) combination of smart cover and keyboard

6) magnetic cover 'click in'

All innovations. Some of them too innovative for the less intelligent, but that's besides the point. An ambitious company can't hold back for people stuck 15 years in the past.

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