HP’s misstep shows risks in big ideas
The ill-fated marriage of the companies is a lesson for HP and other older technology giants as they throw billions at supposedly game-changing acquisitions, trying to gain a foothold in the future.
In that future, smartphones and tablets, connected to cloud-computing data centres, are the essential tools of work and play.
Companies rent software over the air, rather than buying it with expensive maintenance contracts.
And vast streams of data are continually analysed to find new patterns and make predictions about consumer behaviour and product design. Autonomy, for instance, makes software that can analyse marketing patterns and advise a company on matters like where it should increase marketing resources.
These forces threaten older businesses, like HP’s traditional personal computer and data storage products. Other companies, like Oracle, Microsoft and Cisco, also face pressure. They are all trying to buy the future — and have the cash to do it.
In July, Microsoft decided to pay $1.2 billion for Yammer, which makes a Facebook-like social media product for the office. Oracle recently paid over $3.4 billion for two small cloud computing companies that provide software for human resources and sales management. Last Sunday, the computer networking giant Cisco agreed to pay $1.2 billion in cash
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