HP Ditches Hardware For Better Gains In Software Market

With Analysts forecasting a tough time for the hardware market, it was not much of a surprise to the industry when HP announced to spin off its hardware vertical today. But HP was the largest hardware giant in the market, what made HP take such a drastic step? Vishal Tripathi, Principal Research Analyst, Gartner tries to clear the cloud around this decision.

According to Tripathi, HP has taken this step to make an early impact in the software market. “As we all know that the profit margin in the hardware market is not very high and on the other hand the software market is gaining a lot of momentum. So the business strategy is simply focusing on the healthier side of the enterprise.”

The biggest question on everyone’s mind is how impactful will this step be on HP’s business figures? To this Tripathi commented, “With this announcement, HP is aiming to reach the desired profits and hold a grip in the software market. HP is also in talks with Autonomy- a UK based software company, and they might acquire it soon.

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In such a scenario the Hardware market will lose one of its biggest players and it might be a boon for HP’s competitors. On the other hand, it can be a good time for the software market if HP charts out its course well.

“But it is too early to decide whether HP’s proactive step will be fruitful or will it prove to be a bummer because it is still not clear whether the PC giant is going to spinoff their business or sell it for a better price,” concluded Tripathi.

So the industry needs to wait and watch, whether HP’s going to be the mouse that gets the cheese or will it just be eaten up by another cat.