So services are a guaranteed way for an IT company to secure its future, eh? Not necessarily, especially if the organization gets into services through an acquistion. Like all business decisions, it has to be done the right way.
Hewlett-Packard Co.’s announcement earlier this week that will will take an US$10.8 billion charge, mainly due to write-offs on its 2008 purchase EDS is one piece of evidence. Who’s to blame? The knives are already out.
Here’s a roundup of the latest commentary, starting with a Reuters report on HP’s latest quarterly results. Click here to read a transcript of CEO Meg Whitman’s conference call with financial analysts. “We’s still in the early stages of a turnaround,” she said at one point.
ComputerWorld U.S. interviewed Charles King of PundIT, who said IT companies like HP are facing “a perfect storm,” with buyers prefering to spend on smartphones — which HP doesn’t sell — and tablets — which HP is only about to get into with Windows-based devices with after dropping webOS. In addition, King argues, consumers holding back PC spending because Windows 8 will be released in October.
Meanwhile analyst Phil Fersht’s Horses for Sources blog notes that HP has cancelled its annual September analysts conference. That sounds to him like the company has decided to “run and hide.” He makes a good point: In addition to slashing spending Whitman has to give everyone affected — customers, financial analysts as well as staff — an idea of a growth plan.