Wednesday, September 28, 2011

tumultuous

Well, THAT was a fine flurry of events. Along with many others, I weighed in on an opinion piece, when asked (in advance) "what do you think?" The problem is that soundbites are what the TV guys and the journalists are after, not the 'full story'.

Why did Leo get bounced? Well, lots of back story here. When did it start? Some might say the day he was named, given that two-thirds of the Board deigned to meet him in advance to interview him. That story was among the more incredulous to me; two-thirds of the Board at the largest high-tech company on the globe didn't "have time or energy" to interview the one standing candidate after they'd gotten rid of the thug on trumped up charges? Huh? These folk were getting $325,000 for six meetings a year; couldn't they 'throw in' one extra hour and at least meet Leo?

What did Leo do that was so bad? Well, killed the stock price by 50%, say all the WallStreeters and p'o'd shareholders. Not exactly, if you go correlate dates and stock price. Hurd in April got HP stock to $54, it fell 15% to $45 when 3rd quarter results were 'pre-announced' and another 15% to $38 when his departure happened, along with all of the foodfight for the next five weeks or so. Did he have hanky-panky, if so why should it matter, how consensual was it, did he really do more than we've all learned so far (answer -- of course), and so on...

Leo's 'regime' if we may call it that, starts at the $38 level, and ended at $24 or so, down another 37%. So the Board, if you will, abetted a total fall of 55%, but Leo did not do all of that by himself.

No one can defend the atrocious PR moves of the 3rd quarter announcements -- at least no one that I've met. Theories about sabotaged leaks abound, and after the shameful way that the Board handled Leo's dismissal, it is easier to believe them.

More fundamentally, Leo was a victim, in my view, of the vast difference between today's American press and the European business press on the one hand, and the gulf between the American business press now vs. when the Cookie Guy took over IBM nearly twenty years ago. Each faced a situation where the structural changes of the industry and the alignment of investments were at odds. At IBM, the wheels had already come off the wagon; at HP, they were about to do so.

It had to take courage to go to the street, ala David Packard's symbolic statements of the past, to say "we're going to take the heat, and change the strategy, and fix this over some time". Packard, though, owned the place; Leo did not. And this Board has no patience or ability to take the heat, or even, it might seem, understanding of the issues out there. How else could they sign off on dumping PCs?

When IBM dumped PCs on Lenovo, they were fourth in a field of three, losing money, share, and image. HP is the biggest kahuna on the planet, making almost the highest margins (next to Apple), with share = Dell plus Apple put together, in the biggest single product area by dollars on the globe. Bigger even than the Dreamliner.

But the key is the Enterprise play. Which is what the TouchPad was designed to do, NOT to be an Apple i-Pad killer. So who made the dumb decision to go to Best Buy. Does Best Buy sell the PCs and servers for infrastructure at the Fortune 1000? NO...
Someone has been seriously duped on this 'multi-pronged' and flawed strategy. And that isn't addressed or fixed with this CEO change.

So, time will tell. But it is not sanguine. I can only hope that the 'new team' gets it right, somehow, sometime soon. But when (and if) they do, it will look a lot more like Leo's strategy than Hurd's, and a lot more like Carly's than Platt's. And there will be room for a book called "What happened to Camelot?"

Friday, September 16, 2011

HP bashing continues

One of my longtime friends, an HP 'oldtimer', wrote me last week: "Seriously, isn’t it true that there’s a VERY high level of unhappiness among HP supervisors (at least) since Leo was anointed to “save” the company, by getting rid of all that pesky hardware that none of the Board members used or understood? Grrrrrr"

And I surprised myself when I penned him the following:

No, it is not true across the board. The PC group is pissed, true. And frankly, they had it coming. Apple is 15x better these days. They (HP PCG) have gotten so arrogant and haughty, I found it nauseating. Even some of my best friends... sigh

The Services group is thrilled, frankly, even though Ann Livermore was 'one of the true blue HPers", she was stuck and they'd been screwed bad by Hurd. They love (or at least much prefer) Leo and Ray, partially because they understand relationship selling, and because they restored the salary cuts.

Peripherals (i.e. Printing since HP punted Discs and Terminals a long time ago) hasn't liked anything out of Palo Alto since Hackborn set it up thirty years ago. This spans five CEO's: Young, Platt, Carly, Hurd, and now Leo. Nothing has changed, except that they are no longer growing, and their spot in the sun is about over.

The Enterprise game -- which ALL BY ITSELF just surpassed IBM HW and SW for the first time (this is IBM HARDWARE AND SOFTWARE, which is all that IBM used to be) -- is beyond thrilled. This is the group that bought Autonomy (which I think was a stupid purchase because they bought the wrong company, not the wrong segment. Attensity's technology works; Autonomy's has been 'sold' to big corporate clients, but is really second-rate stuff by comparison. All the local 'smart companies' use Attensity now).

IBM is befuddled, despite the glowing East Coast press, the ads, and the stock price. You don't see this in the Wall St Journal, they still cannot believe that IBM is as weak as it is -- a problem they've had for thirty years. Ditto the Harvard Biz Review, the New York Times, and that asinine analyst reprinted in the San Jose Merc today, Toni Sacconaghi at Sanford Bernstein. The idiocy of these 'presumed analysts' escapes me how they get printed

This dumb bastard Sacconaghi issued an UNDERPERFORM, and then defends it, saying at the end the following: "I expect the stock to be at $37 within a year, so therefore it is a stock to avoid -- it takes a lot of patience". Is this guy for real? 61% gain in one year -- that's a LOT OF PATIENCE? These idiots are essentially day traders masquerading as investment advisors.

So, my friend, I'd say HOLD or even BUY. If they successfully spin out PC's (which they should, and will), that $40 Billion business alone will likely support a $10/15 per share price. If they do that, I would modify my longtime position to think that HP should also do the same with Printing. That would be another $12/18 per share -- how many $25 billion companies besides Intel, Microsoft and Google have greater than 50% market share and greater than 10% net profit? Those two pieces alone are worth more than the whole company is valued at today, mostly by panicked uninformed stockholders who've been pissed that the Board sacked wundurkind Hurd (the guy who systematically took R / D apart and virtually single-handedly killed HP morale and ethics) and now that Leo is having to rebuild the place, they're blaming HIM. Get real!

The company that would be left would be bigger than PCs and Printing. It'd be a $60 billion juggernaut, growing twice as fast as IBM, aimed squarely at the "new cloud world" with more relevant underlying technology than IBM or Oracle or Cisco have today, and the only other contender is SAP, which they'll perhaps buy with the proceeds from the two sales. The new company would be worth $50 / 80 per share if given equivalent valuation to IBM's exalted price.

No one recalls that John Wooden had seventeen losing seasons at UCLA before his first team went to the quarterfinals. The next fourteen years built the legend.

No one recalls that Steve Jobs managed to cut Apple revenues in half in his first seven years back after they sacked Amelio and the other "suits". Nor that when he finally got growth back into Apple, it took three more years to get profitability turned around. It took four years to get the i-Pod "successful". And it wasn't until the i-Phone II that the sales were sustainable, let alone exciting. No question that Jobs deserves the accolades he gets. No question that it took him longer than John Wooden to 'get it right'

The clown in NY, self-reputed hedge fund genius David Einhorn, who in a May speech wanted to bag Steve Ballmer for 'bad management' at Microsoft since the shareprice hasn't risen in a decade, shows similar lack of understanding even though he can put dates on a stock price chart. He must have bought at the peak, and he clearly hasn't read the same equivalent numbers for Intel or Cisco or he'd be after all CEOs of high-tech companies that had bubble-priced stocks in 2000. Ballmer's run has been extraordinary, re-profiling the company so that it is NOT Windows-dependent, growing twice as fast as Intel, Dell, HP PCs, Cisco, and five times as fast as IBM, while merely tripling profits. Not a bad ten years for what is now a $75 billion dollar company at 20% net profits. Einhorn is a total idiot. But sadly, it is folk like him that shareholders have to listen to.

Most investors, I am convinced, don't have much if any sense of history. So, my friend, this can work to your advantage. HP is way stronger than the market is saying today. Enjoy...

Monday, September 12, 2011

Cisco paved the way for a long hot summer

The weather hasn't been all that warm in the Bay area this spring and summer, but the business press has been hot, Hot, HOT. Especially with the stories 'behind the stories'. Cisco downsizing, HP/Oracle suing and countersuing, Apple/Google suing and countersuing, Oracle and Google suing and countersuing, HP announcing with great fanfare and then withdrawing in even bigger fanfare, Jobs resigning and Carol Bartz detonating. Big stuff. Too much to digest?

Like, for instance, Cisco's 'blockbuster announcement' in mid-April about a possible 're-alignment', shifting from twenty-two "primary initiatives" back to "our main business". And then describing that this 'might' result in laying off 6,500 jobs. The business press treated it like a bombshell, but the number was disguised beautifully. First of all, it ignored the 5,000 folk with Fibercore and the Set-Top Box business who were 'sold', and it ignored the 500 folk with Flip-cam, jettisoned the day before they were scheduled to release their next great product. You'd think that with the top product in the world, you'd at least try to sell the division rather than just cancel it.

These moves get Cisco to 12,000 jobs 'lost' rather than 6,500. Then, some 3,000 were announced as 'taking the retirement or severance package' while another 2,800 declined such an offer. In spring 2011, estimates were that Cisco had 73,000 regulars (losing 15,000 by the count we've just listed, though the company later insisted that the 'retirees' were among the 6,500), and perhaps 25,000 'temporary workers' (plus or minus 15,000 or so).

Then, some unacknowledged number of 'temporary workers' were cut adrift, but the company would not comment on this one. The last time, in 2001, the numbers were staggering in the 'temporary ranks' -- then Cisco reportedly had 40,000 'regular' workers and 4,000 temporary. And 3,000/5,000 of the 'regulars' were let go, while 2,500 of the temps were dismissed. Estimates are that forty percent or more of the temps (vs. 60% ten years ago) were shown the door this time around. One key division reputedly had 75% of its 'staff' as 'temps' -- all of whom were dismissed.

All told, these frankly speculative numbers would put the real downsizing at 22,000 to 25,000 people, out of a total workforce of 98,000. That's BIG by any standard.

Why the secrecy re the 'temps'? Well, there are several reasons. First, this is a category that gets lots of Washington DC scrutiny after all the claims and issues around 'body shops' and cheap foreign labor and H1B visas. Books are now coming out describing some of the disgraceful practices, taking advantage of foreign nationals who have studied in America (50% of America's Masters degrees and 70% of PhDs granted in electrical engineering are to foreign nationals these days) and want to stay, or prospective graduate students who use jobs here as an entree.

Second, these jobs are by definition, and by law, restricted to "less than one year" in order to avoid the company having to provide health benefits and government wage taxes, costs that increase the labor cost to the company by up to one-third of the salary (but which tend to build longer-term loyalty as well as carry the fair share of the infrastructure cost of running our country). Anecdotal evidence, though, is that the average 'temporary' worker being let go at Cisco (just like most of the other Valley companies who use this same practice) has done the same job for an average of three and a half years -- the contracting 'job shop' just rejuggled the job title and description once a year. Patently illegal, but perfectly 'normal' in the Valley these days according to my sources.

And then, the rumor mill floated that Cisco's enormous push into 'the consumer space' with Linksys and the Scientific Atlanta acquisitions, as well as Webex and Tandberg for conferencing services, might be killed as well. The Tandberg folk we interviewed cheered this news mightily, but to date it is just rumor. When HP shot its own versions of teleconferencing a month later (June 1, 2011), the question became "does Cisco REALLY make money on these big Telepresence rooms? or do they give them to their biggest IT-shop clients to sweeten the router/fiber usage bundle?"

If all of this effort ebbs, it would be a shame, I think, for these are in fact game-changer technologies, just not particularly well executed as yet (little things like eye-contact sucks on the edge seats, because they save the cost of two extra cameras in a half-million dollar system).

All told, an interesting time at a company that has long been a bellwether in the Valley, both for a great place to work, and a progressive set of ideas for the market

Wednesday, August 24, 2011

Robert X. Cringely weighs in

Metroactive.com, the little San Jose rag laying around in fast-food joints and coffee shops, this week has Robt. X. Cringely's SV411.com column headed "Losing the HP Way." As usual, Cringely doesn't pull punches. He cites the Agilent spinoff in 1999 under Lew Platt as follows: "While this made sense at the time, and even today, there were unintended consequences of that spinoff -- the loss of HP's corporate soul.... Lew Platt blew it in my view."

Cringely mentions the 10% time for employees working on their own ideas as an early HP idea, rather than Google who now gets credit for 'inventing it'. Robt even says (correctly) that if you needed lab stock for your 'wild-ass idea' or anything else needed to do the job, say a magnetron or a barrel of acetone, it could be taken without question on Friday afternoons.

The cruelest irony he notes is that Apple will now be building its new spaceship intergalactic headquarters atop what used to be one of HP's most important labs. He's right. Might be right in his final sentence too -- "HP may have no route back to greatness."

Compared to today's idiotic articles quoting asinine pundits in the analyst world who think it fine to speculate that Oracle will buy a beaten-down HP to give Hurd satisfaction for burying Leo, Cringely does a straight-forward sobering analysis. HPites everywhere (the old kind) are saddened beyond words.

Monday, August 22, 2011

bad news brings out more stories

I had a chance this weekend to meet a CIO who 'knows' Apotheker and Hurd from days dealing with NCR, SAP, Oracle and HP. The story I found most fascinating concerned an NCR deal with Home Depot on some very customized, proprietary software for in-store customer tracking / inventory correlation. HD had a two-year exclusive, and it took about a year to debug the new system and get it functional, at which point it was instantly valuable to Home Depot. But, through a CEO 'decision' at NCR (guess who), a loophole was found that enabled NCR to sell the same SW to Lowe's, for instant installation. Lowe's was thrilled, Home Depot could sue but not walk away, and NCR shareholders all benefited. HD went later to SAP, and as it was reported to me, found them to be extraordinarily ethical. Hummn...

Friday, August 19, 2011

kinda called the shot?

I just re-read my own blog a bit, in view of the news this week for HP. May 21, analyzing the second quarter numbers, I opined that HP is screwed in the consumer market -- PCs as well as TouchPads, etc. While hardly new news to anyone (since some pundits have said this for thirty years), it was satisfying to me to read my own prophecies and realize they were pretty accurate.

Today, I'd have to say, "What were they smoking over there?" This company has been out of touch with consumers for so long it is embarrassing. (Again, some longterm observers would say, "Charlie, name me one time they were in touch"). They make Motorola's disaster look like child's play, although they aren't (yet) being compared to Enron or AIG.

But for the world's largest revenue high-tech company on the globe, this has got to be viewed as mostly catastrophic. Predictably, the stories this morning go back to Carly's tempestuous acquisition of Compaq, clearly pinning the blame on the Wicked Witch. But it is hard to blame it all on Carly. She's been gone an eternity in Silicon Valley years. Consider -- she was bounced two and a half years before the i-Phone appeared, more than five years before the i-Pad appeared. Think of it this way -- Apple had yet to average 1 million i-PODs per quarter, or i-Macs per quarter -- when Carly was deposed.

It was Marc the Knife (the kindest appellation we've heard in a year for this abusive tyrant who was praised all over Wall Street) who presided over the destruction of R and D (along with ethics, any sense of community involvement, charity, or tragically, the HP Way) that paved the way for this denouement of an icon.

Apple did do R and D, with acute market sensitivity, and boosted i-POD sales by ten times in the next two years, boosted their PC/laptop sales by four times in the next five years (into a "dead, mature market"), and without the i-Phone and the i-Pad built a dynamic exciting company compared to the cost-cutting enterprise-focused Palo Alto progenitor of Silicon Valley.

And now, based on four exciting consumer-facing product lines (only), Apple has surpassed IBM in total revenues, and is about to pass HP. The only saving grace for HP in terms of 'standing tall' is to note that 'iconic' Intel, Cisco, Dell, Microsoft, Oracle, and SAP have all stagnated worse than HP, while other iconic companies, notably Sun and Motorola, have disappeared.

Unfortunately, American companies, by and large, are being managed (and lauded) by folk who resemble the leadership that has just failed HP.  Check the statistics for DuPont, Merck, Kodak, Boeing, John Deere, General Motors, AT&T and Verizon, or your favorite retailer, and it paints a sorry picture for what the Wall Street Journal and Harvard Business School types admire.

end of an era

The PC business for HP has beeen bookmarked by Apple. And "TOUCH"

HP, despite what the Computer History Museum august visitors think, invented and sold the first successful Personal Computer -- the HP 9100A, eight years before Ed Roberts did the Altair. And in the Computer History Museum timeline itself, Ed says "Jeez, the Intel Intellec I was a PC, and they just didn't recognize it." He is right, of course -- the Intellec I, which was a development systme for designers to write code to program their new microprocessors, was built by a team inspired by the HP 9100A, including Bill Davidow who moved from being one of HP's first three PC salemen to Intel. DUHHH...

And Wozniak, working at HP, proposed the "Apple 1" to them, but was ignored -- actually he was given permission to do it without HP interference -- about the time that Ed Roberts had his seance in New Mexico and met a kid named Gates.

It took another eight years for HP to "wake up" and decide to compete -- with the vaunted TOUCH-SCREEN, a machine with a TV ad of a Monarch Butterfly flitting onto the screen and causing magic things to happen. The Ad preview was screened for the HP Executive leadership in Napa at the tony Silverado Country Club the morning after the Apple Hammer-throwing ad ran for the first and only time at the 1984 Super Bowl.

HP execs were told confidently by our McKinsey advertising and marketing team that we'd go from 2% of a modest PC-world to 21% in a year with our machine and their help. This, bear in mind, is a year after the IBM PC was on the cover of TIME magazine as the MAN OF THE YEAR. And this team blithely wrote off Apple, whose Apple III (done by ex-HPites) and the LISA (done by ex-HPites) failed.

When the numbers were in a year later, the Mac sold 200,000 machines (only half of Steve Jobs' prediction, which fueled his unplanned departure from Apple), and HP's expensive, slow, unreliable, impractical TOUCH-SCREEN sold 40,000 -- not exactly hitting the 21% market share number. So the first head-to-head failed, pretty hard.

The second? HP announced the TouchPad in January 2010, but concluded it didn't work by April. Apple announced its i-Pad in January 2010, delivered in July, and sold one and a half million the first month, fifteen million the first nine months. Business Week reported that HP had to buy Palm and WebOS because they had outsourced R*D to Asia (gawd) and HP confidently said, "the TouchPad will be the businessman's indispensible tool" HP built 500,000 for the initial launch a year after the i-Pad launch (and four months after the SECOND i-Pad launch. Best Buy, the biggest electronics super store on the planet (but not exactly an enterprise supplier) took 300,000 units initially, and returned 270,000 yesterday.

So -- Touchpoint -- don't name your product "Touch..." and don't go up against Apple?

blockbuster news?

Page 351 (and again on p. 503) of THE HP PHENOMENON has Packard's famous quote: "The only thing worse than a little shitty business is a big shitty business". His ghost doubtless jumped for glee yesterday.

The early morning San Jose Merc story said "HP has sold 25,000 TouchPads; Best Buy has 270,000 in inventory". Somewhat different than Apple stores with queuing customers for each new breathlessly awaited release of (your choice -- an i-Phone, an i-Pad, even a new Mac).

The mid-afternoon story was somber -- the TouchPad, the WebOS, and the Palm Pre are gonzo. And HP plans to (HOPES TO) abandon the PC business. Some bloggers said "Jeez, this guy Apotheker is killing the place" while others cheered and said, "This guy Apotheker just might save the place"

A fascinating week, juxtaposing the Google acquisition of Motorola's capsized phone business with HP's highly visible faux pas.

Consider -- Jobs now "walks on water, brings his own water with him." But for the first eight years after he returned to Apple, the headlines, analysts, and pundits all panned him. It wasn't until the third round of the i-Pod, circa 2005, that the headlines started being positive. And then for the i-Phone, Dvorak was merciless, and Ballmer beyond rude for early 2007. When sales 'tanked' a year later, everyone said "SEE" And for the i-Pad even, the erstwhile competitors (did we say Ballmer and HP combined this time?) all pee'd all over it -- "it'll be a failure like the Newton, no one really wants ... " Now he's viewed as this idiot-savant genius who can do no wrong. Some might say, "jeez, all he did was insist on CONTRIBUTION for customers, and insist on great innovative engineering" What a concept!

Little known fact -- the Mac (yes, they still make 'em) has gained unit sales of 28% per year for the last nine years, very profitably, in the 'dog-eat-dog' personal computer space. Hummn. This has been the annuity profit generator for Apple. This is a "mere" 15 million Macs per year today (everyone said the i-Pad would cannibalize it, but it has given a "halo effect" instead).

The i-Phone killed both Nokia and Motorola phones (there is a huge story here about how to go from the highest unit volume single electronics product -- the Razr -- in world history to virtual bankruptcy in six months, for one of the most iconic electronics companies in history).

And the i-Pad killed not just the TouchPad, but all of HP computing (a $40 billion business for which kings and queens fought and died) in one month of head-to-head. Whew!

Tuesday, July 5, 2011

makes you wonder where they get the numbers

We went to see Cars II on Saturday night with our granddaughter. It was the #2 grossing film of the night for the nation, in 4,115 theatres, grossing $9.5M

We went to see Midnight in Paris on Sunday night. It was the #10 movie in the US that night, in 858 theatres, with $1.3m gross.

What was amazing to me is that Cars II was in its second week, and there were maybe twenty people in the theatre in the heart of Silicon Valley. "Midnight" was sold out at the first four theatres we tried with Fandango ticketing, and for the show we got into, it was jammed, probably two hundred people in the theatre, the seventh week after release. Every week of the first six for it have gone up in numbers, but no weekly number exceeded what Cars II did on that one Saturday night.

I don't question the box office numbers. But I do wonder why the 'on-the-ground' experience is so misaligned to what the numbers say.

I'm reminded of this because I am old enough to remember the MacIntosh and the original IBM PC. No one in Silicon Valley thought the PC had any lasting value (well, okay, 'no one' is a bit strong, but even Andy Grove was dismissive and his chips were in it); lots of folk were enamored of the Mac. The PC though won the dollar contest in business, hands down, by a margin of better than an order of magnitude.

So if there is any solace for HP today, after the dismal reviews of the TouchPad this weekend, maybe they can liken the iPad to the Mac, and the TouchPad to the PC?

No, no, don't go down that path, Charlie

my experience re iPad

The day before Mother's Day, I wanted to get something electronic for my wife. She's used her Kindle sporadically, her Blackberry non-stop, her MacAir faithfully, and her HP PC from Cisco grudgingly, compared to her 27" iMac. She did work for HP for five years, admires the company to this day.

I loved the Sharp Galapagos, esp. the 10" screen, in March in Japan, but it didn't clear the FCC reqments in the US until today, and won't be available for months. So, in reading all the webdata, the Barnes and Noble Color Nook looked like the best bet. She reads every magazine there is, so this would be perfect, I felt.

Staples had a display of both color and B/W Nooks, as well as every Kindle model, the Motorola Xoom, and the Nokia, Samsung, and Sony machines. Android was available for all but the eBooks. I could fondle each machine, try it on National Geographic, Travel and Leisure, and Bon Appetit magazines,and also browse the web.

The Nook sucked, in a word. Poor quality, poor feel. The Xoom was the best, but not overly intuitive.

Four people were in the store, none looking at these 'hot items'. I asked the clerk which were the most popular. She said she'd sold a couple of Xooms. I asked which she preferred. She ducked her head, and whispered, "The iPad, but we don't carry it."

I went to the Apple store at the Stanford Shopping Center. I was the 32nd person in line to get a number to wait for a Specialist, who could take my order. I could fondle (after waiting behind a crowd) one of the twelve iPads on display while I waited. When my Specialist got to me, twenty minutes later, he said they were out of all iPads except the hefty-accesoried model for several hundred extra dollars, but he could sell me a very nifty gift card, and maybe by using the on-line store, she could get one in two or three weeks. Or, he said, she could check back next week.

She loved the gift card. I mentioned the Xoom and the Nook alternatives. She said, "you are kidding, right?"

The following Saturday, we were at the Apple store at 9:55am, they open at 10am. We were the 21st customer in line. No one else seemed to be anywhere in the mall. They told her, try the on-line, it'll be faster.

She got her iPad two weeks later. She loves it. I mentioned the TouchPad this weekend -- she said, "aren't they a little late?"

Ouch, and then some

http://www.zdnet.com/blog/perlow/hps-touchpad-where-are-the-retail-fireworks/17671
This post has got to be concerning. What a great 'on-the-ground' report.
Jason Perlow wrote: "today on my lunch break I headed over to Best Buy over at Garden State Plaza, one of the busiest shopping malls and retail complexes in the entire country. Granted, the 4th of July weekend probably isn’t the smartest time to launch a new tablet. In New Jersey, a lot of people scooted out early and went down to the shore last night. But Garden State Plaza still was filled with plenty of cars at 11:30AM today. I parked my car outside of Best Buy. No lines out the door, no police attempting to keep order. I walked in.
I glanced at the security guard. “Where is the HP display, you know, for the tablet?”

“Oh… all the computer stuff is upstairs.” He motioned me to take the escalator. I took the ride to the top.

I walked over to who appeared to be the retail sales manager. “So where’s the TouchPad?”

“The what?”

“You know, the HP Tablet. The one that goes on sale today.”

“I don’t think we carry that here.”

“You’re supposed to be their primary retail launch partner, how could you not have them?”

“Well, all the HP and tablet stuff is over there… (pointing) it might be on display, if you get the SKU, just get one of the stock boys to get one out of the cage.”

“Okay.”

I walked over to the tablet area, where there was a prominent display for the iPad and various Android tablets, including the Acer Iconia, the ASUS Transformer and the Motorola XOOM. Off to the side, on an empty white formica table was the HP TouchPad.

Nobody was huddled around it. Nobody was playing with it. There were no lines of people asking to buy one. There was one other gentleman who came to buy an ASUS Transformer who asked me a few questions about it while I fondled it and took photos of the store.
I motioned over to the stockboy and pointed at the SKU for the TouchPad. “Can you get me one of these out of the cage?”

“Sure… you want the 16GB or the 32GB? We’ve got about sixteen units in stock if you want to buy more of them.”

“16GB, thanks. Do you have any accessories, like the Touchstone or the cases? Or the keyboard?”

“Nope. I can check the Fashion Center store though. (calls other store on phone, asks for the electronics department, waits on hold for about 30 seconds) No, no accessories. The other store has about another 20 of these. Here’s your tablet, I hope you like it, it seems pretty cool.” He hands me the box.

“I was kind of expecting HP to have a better display, with demos and stuff. Maybe a customer rep to show it off.”

“Yeah, well, HP came over to Garden State Plaza earlier in the week for an event when the Transformers movie came out as sort of a double promotion. But they haven’t been here since. I heard they may have given the guys some training at the other store.”

“How many of these have you sold today?”

“You’re the first.”

I handed the cashier my AMEX, paid, and walked out.

Saturday, July 2, 2011

confusion in the marketplace?

Friday's Wall Street Journal carried the following (by Ben Worthen and Ian Sherr):

"H-P's device, the TouchPad, comes more than a year after Apple started selling its iPad. In that time, Apple has sold more than 25 million tablets and added nearly $100 billion in market capitalization. H-P, meanwhile, has lost $50 billion.

H-P is planning a marketing blitz for the TouchPad. But it faces an uphill battle in the fast-growing tablet market, which is dominated by the iPad and crowded with devices from Samsung Electronics Co., Motorola Mobility..."
Read more: http://online.wsj.com/article/SB10001424052702303763404576418063248909764.html#ixzz1QyINXwXQ

A classic, really snotty article, by journalists with their heads parked where the sun doesn't shine. HP lost virtually all of the capitalization due to the Hurd debacle, not for lack of a TouchPad. And as we've documented here for several years, the Hurd shell game was essentially over, and whoever was next would have to deal with a shortchanged deck.
Yes, Apple's stock has gone nuts, rightfully, and the i-Pad is a huge winner (as are the i-Pod, the i-Phone, and the i-Mac). But Cisco, Microsoft, RIM, Nokia, Motorola, Intel, Oracle, SAP, and even IBM stocks have fared poorly also -- check it out, and no one is suggesting that they should be head-to-head compared to Apple's success.

Saturday's WSJ Blog repeats the quote, adding that: "Fifth Man in a Four-Man Race’: Starting today, H-P will have employees stationed in over 100 Best Buy stores, selling its new TouchPad tablet priced at $499. The device debuted to some mixed reviews, earning plaudits for its WebOS and criticism for everything else. A major negative, the lack of native applications. H-P said that the TouchPad will have 300 apps—roughly 89,700 apps less than Apple’s iPad. The company is working with software makers to develop programs for the device, but with no established customer base there is little incentive for developers. The WSJ tracks down a mobile games maker, Bryan Duke of Acceleroto who says, “I can reach a bigger audience—more happy customers and more potential revenue—with [Apple’s] iOS,” he said."

Well,duh... HP pointedly said for months that it is building a Business TouchPad, not an entertainment TouchPad. Accelerato builds games that no IT manager would allow to run in a business setting. So do the porn guys, but their stuff sells. An X-rated producer could give an equally appropriate WSJ quote.

We just hosted three grandchildren this week, two are eight years old and one is thirteen. We compared notes for our i-Pads (yes, we each have one). The thirteen year old girl had over two hundred apps; two were worth adding to my wife's iPad which she uses primarily for her business, but also for magazines and even the WSJ. Of my wife's seventeen apps, the girl wanted one. The eight-year olds had already used their monthly allotment of minutes, and filled a quarter of the memory with streaming video shot around their house. The first sixteen movies appeared mostly to show the family dog wandering all about. Deathless video, destined for YouTube.

Serious laptop users, serious book readers and researchers, and most folk who work for companies have real work to do -- if the 89,700 apps now available on the iPad and not on the TouchPad, help dramatically in those contexts, they'll be ported soon enough -- provided that HP can establish that it has built a quality product for real business users, overcoming the clear shortcomings of all current iPad-like devices for such environs. But such observations don't make good press copy.

Tuesday, June 28, 2011

Reading the signals

So, in the last couple of weeks, HP has had three more announcements
1. Suing Oracle (and Hurd) again
2. Restructuring the Management Council, Executive team, and Board a bit
3. Rolling out TouchPad

Press reports to the next phase of the lawsuit, brought re Ellison bashing HP computers and in particular Intel's Itanium, seems fruitless in many circles. The really big news here might actually have been Oracle's quarterly report, where they were forced to report that their Sun computing arm had revenues shrink again, to about half of where they were a mere two years ago. This is a dead, dead line, with no chance at Oracle of keeping the inventive genii who kept Sun alive for so long. So Ellison is spending his time bashing HP, seeding doubt and fear as much as possible, and generally acting like ... well, like Larry

Apotheker continues, in a deliberate way it would appear, to put his stamp on things at HP. He moved Ann Livermore, the embattled, thrice-passed over Chieftain of HP services, out of the company and onto the Board. Ann, much-loved and disappointed once again in a goal to become CEO, has run services for a very long time. There is a truism that you can outstay your enthusiasm and creativity -- might be true here. He also elevated Steve DeWitt into PSG leadership, sending Tood Bradley to China. This is terrific news for innovation at HP, and could also be positive re opening China further. Bradley, a hard-charging exec with many of Hurd's better qualities, will be an interesting international player; DeWitt's chops are all about innovation, which can only be cheered from every vantage point.

"FINALLY" rolling out TouchPad, HP's belated version of the i-Pad. Recall that Steve Ballmer showed HP i-Slate at CES in January 2010, three months in front of the first i-Pad release. With a Microsoft OS base, and Intel chips (never competitive at cellphone architecture or battery-powered apps), and an outsourced foreign developer, this product was screwed from the get-go. And then HP, via Phil McKinney, had a chance to buy a distressed Palm Pre with its innovative next-gen operating system, WebOS. This was also a chance to snare Jon Rubenstein, a legendary designer with innumerable successes under his belt.

The Palm Pre failed because the cash-strapped company couldn't match Apple's gigantic Apps Store for the i-Phone, not for lack of product. Rubenstein knows Apple, leading the team for the original i-Pod, for example. He also knows HP, having led the first HP programmable computer years ago.

See todays San Jose Merc article with Steve DeWitt. HOPE that innovation is back!

Saturday, May 21, 2011

What DO the numbers say?

Second quarter performance was mostly terrific, some might say -- so why did the stock crater? Some say Cathy Lesjak shouldn't have been so bullish earlier in the year, and that Leo Apotheker had to retract her forecast -- perhaps true. Note that what he said was "earnings of $5.00 vs earlier a $5.20 statement". People (or automated trading programs at least) ran for the door.

But consider, HP has always been strongest in 1st quarter, due to its shifted fiscal year, and it has never been a "fourth-quarter phenomenon company" in sharp contrast to IBM, for example. And the first quarter was $1.17, up 27% vs. a years ago, while this quarter at $1.05 was 15% ahead of a year ago. So, even if there were no rain clouds on the horizon, they've got a tall order ahead to get a second half of $2.98 vs a first half of $2.22. So, retrenching a bit makes all sorts of sense without invoking the shibboleth of "what Hurd did to gut things, that now must be restored" or the issues surrounding Japanese supplychain with the earthquake and subsequent disasters in that unfortunate nation.

More instructive to dig a bit deeper, in my view:

PCs -- this is the Achilles Heel, perhaps. The i-Pad is going gangbusters, have you heard? And HP's tablet entree is late, off-target, and ill-equipped to compete. So that game is probably lost for this round at least. Does it matter to PCs? Sure. And we now have 1Q and 2Q results. HP PCs, the leader in the world, is DOWN 12% in Q1, and DOWN 23% in Q2 for the consumer markets. Thank goodness Corporate America (and the world) like PCs (and cannot figure out yet how to make iPads useful for work rather than entertainment), so corporate PC sales are UP 11% in Q1, and a remarkable 13% in Q2. Overall, HP PSG performance (never mind the re-org structure) is more-or-less holding its own, down 5% overall in revenue, and down from 6,4% to 5.7% in net profit.

Is Dell the issue? Not really. Their total corporate growth for the identical time period, was 1%, vs. HP overall at 3%. They now get 30% of their business from the enterprise level of servers, storage, and services as well. They reported DOWN 7% for their consumer biz, so in that $3B segment, they lost less than HP.

The real question for consumer level stuff is whether HP really can play here at all. It has not been a historic strength; it is unlikely that the current holdings will burgeon again, and it is clear from hindsight that the vaunted HP R&D creativity has yielded next to nothing compared to, say, Apple (not to mention Sharp, Canon, Android, and other hardware/software folk). This ignores completely any question about Google, Facebook, Skype, LinkedIn, Amazon, etc. services.

Enterprise stuff, sans services. HP, first quarter was down 2%, but Q2 was up a very solid 15%, vs. Dell, up 5%. Hummn. Here the right comparision is IBM (or Oracle, Cisco, WHO?). This could become solid, esp. when combined with Software up 20+% at great margins, and Enterprise printing up 41% after a solid 33% in Q1. So, we'd have to give HP very high marks in this space -- it has growth, margins, and a big territory. If the i-Slate (sorry, I cannot get past the old name) works for this arena, it could be GOOD. Bear in mind that the i-Phone, for rounds 1, 2, 3 and now 4 have yet to challenge the RIM Blackberry. It is Android, not an Apple mentality that serves corporate requirements. So, stay tuned, but this is where HP action is.

Printing. My Gawd, this just keeps performing. Up 5% in Q2 after up 7% in Q1. Clearly, the enterprise growth rates are helping, but paper must not be dead yet.

Services. Up 2% with a 15.2% margin. Vs. down 2% with a 16.0% margin in Q1. This is the truer concern, rather than PSG. This MUST perform. And these growth rates are anemic. And IBM is thumping HP right now, not to mention a host of dedicated companies. And this is the group that has not yet perceived that the HP Way exists, c.f. the comments of Peter Hill in his Amazon review of our book or the blog post earlier today. So Apotheker has to address this if HP is to find this business of value. And when you factor in all of the Corporate Board members, it is laughable to imagine that their expertise is very appropriate to this side of the business (c.f. Tiernan Ray's rant in Barron's). The E-Bay model was hardly "corporate services" and that charitably would be the closest of anyone on the Board to this world. So Apotheker, to a significant degree, is going forward here without much hands-on guidance.

BUY -- SELL -- HOLD?

The good news is that HP is currently discounted in the marketplace pretty well, so if you weren't an owner, you might consider it now. But it will be a longer rather than shorter 'play' if we are reading this correctly.

who IS in charge?

Tiernan Ray has a provocative column today in Barron's, posing the question of who is really running HP today. Here's some of his heavy hitting: "WHAT I HEARD LAST WEEK, FROM SOURCES who would rather remain nameless, is that the board of heavy hitters think they know the strategy better than Apotheker and that there have been differences of personal style, if you will, between Apotheker and some members of the board."

"What might that mean? If two powerful venture capitalists, Lane and Andreessen, head up the board's technology vision, it's conceivable, some sources mused, that both individuals could be telling Apotheker, in effect, how he should spend investors' money, rather than that decision coming from Apotheker himself."

Ray goes further, mentioning Meg Whitman, one of the more interesting and arrogant CEOs in recent memory, renowned for her spotless record (actually spotty is a much better word, if you consider that the EBay board couldn't wait to undo her strategy when they helped her deplane. Then we all got to witness her maladroit run for Governor in a state which has gone completely soap opera).

Without getting deep into this discussion, which will doubtless unfold over the next few months, it bespeaks an interesting conundrum for Apotheker that link to the obvious issues inherited from the last fifteen years of CEOs from Platt to Firina and Hurd gutting R and D and contribution from "the bottom"

Apotheker was bold this week, proclaiming that he would accept shareholder dismay while he works to build the longer-term business, especially in the weakened services side. Shareholders heard him, punishing the stock price by 14% from ten days ago. Since the new estimates are that 45% of NYSE stock transactions are now held for nanoseconds in trading programs rather than months or years by traditional investors, this is not at all surprising. And HP stock increasingly, as with most on the Big Board, is held in institutional form, subject to the same slavish behavior of any herd mentality.

So, he's on a short string, vindicating the pundits and shareholders who were incensed when the draconian last guy (what was his name again?) ran things.

Must be a pretty hot seat.

Dead DEAD?

A fascinating week! First, let me acknowledge Peter Hill's critical Amazon review posted last week. He takes strong issue with our HP book -- which he bought hopeful to "motivate me to think better of the company I work for." He's been at HP two years, coming via the EDS acquisition. His conclusion about our book -- two stars out of five, pretty damning! -- is that "Something is definitely wrong at HP and this book sadly is not much help in finding out what. It's a nostalgic look that is probably really interesting if you are 70 and remember working at HP in the sixties."

And yes, I agree with him when he paraphrases our opening "the HP Way is dead, Dead, DEAD" and he adds that "it's been dead for twenty years". I couldn't agree more. I left the company 20 years ago for that very reason.

Furthermore, I agree with him when he writes "you'd be better off to read the gossip columns about the Mark Hurd dismissal". The fact that we contributed heavily to those gossip columns -- I was the first one, and the only one in the worldwide press for 72 hours -- to pronounce that guy the thug that he was (and is), aptly caught in Hill's quote "the greed of the executive tier and the manipulative bunch of silicon valley insiders responsible for the acquisition bloat that is HP today."

If Hill were to review this three year running blog about HP, he might find more relevant material re "today's HP" than in our avowedly "strategic history book" about HP. My guess is that Peter is struggling with whether he is at the wrong company, or the right company at the wrong time -- just "reading between the lines"

But his question and extended critique begs a serious answer. Bianco's book "The Big Lie" about Hurd's corrupt leadership comes at it for an individual, at this one company. But the book that takes on Corporate America, not just greedy HP leaders or even Silicon Valley insiders, has yet to be written. That book would have to include Mike Cassidy's column when Paul Baran died, where he opined that Baran was a relic of 'the old days' in silicon valley, before "business bullies and braggarts" took over.

I call it "The Broken Dream: Wall Street vs. Main Street" (copyrighted here first). Such a book would analyze just when it was that Venture Capital, the nation's Business Schools, and Wall Street conspired, albeit loosely, to decide that Charlie Wilson at GM 58 years ago was wrong when he said "what's good for GM is good for he country." Now the thesis instead seems to be "what's good for (insert your favorite company name here) is good for the shareholders" while leaving unsaid the rest of the sentence -- "and to hell with the employees and the local community". The HP of which we wrote believed that shareholders were pnly one of four major constituencies to be served, and executives at the company were not even one of the four. Back then, employee contributions to local civic affairs was expected in both time and resources; employee satisfaction and enthusiasm were important, even vital. Outsourcing would have been anathema, even as intellectual contribution around the globe was celebrated.

That book would be more relevant, but it would be a depressing book to have to report that not only HP, but Intel, Cisco, Oracle, Microsoft, IBM, and practically any other of our 'revered' high tech giants of yesteryear have the same disease. Not to mention Citibank, Merrill Lynch, WalMart, Motorola, DuPont, Xerox, any car company of rank, the oil companies, AIG, Boeing, Kodak, and other "household brands" We've broken the bond, and this, more than sagging K-12 math scores, is killing America.

Not sure that such a book would be very popular, certainly not in leadership halls.

Tuesday, March 22, 2011

a cornucopia about to flow

we're starting to have HP writers... hooray.

For some reason, for the first seventy years of HP's history, no HP executive ever published a book about the company, or even their own experiences. Sure, there was Barbara Waugh's personal saga which is a wonderful tale from an HR and humanistic perspective. And Dave Kirby and Karen Lewis helped ghost Packard's autobiography.

John Minck continues to update his essay about HP roots and personalities, first published almost twenty years ago now. Gosh, does that seem possible?

Now, there are new encouraging signs. John Stedman, who provided significant help for Ray Price and me on our book re the peripherals history, has published his memoirs, a 400 page extended essay that HP buffs will find interesting. He includes much about HP's move into Bristol England as well as the Boise, Idaho experiences.

More significantly, Webb McKinney is engaged in writing 'the story' of the last twenty years, from his vantage point on Lew Platt's and Carly Fiorina's staffs. Webb managed the integration of Compaq and HP, one of the alltime best large-company "mergers" He has been working with Robert Burgelman at Stanford's Business School on this project. They have a singularly effective article about HP's failure to seize the network hub business that I heartily endorse. This could be one of the best business books about a large company in search of keeping its excellence. I can hardly wait. Burgelman is well known for his close association with Andy Grove and the Intel story; his involvement will doubtless help the sales by giving the book credibility at the major business schools, something that we managed to avoid by taking our own approach rather than the Harvard Biz Press model.

gobsmacked

Now there is a new word to me -- "gobsmacked"

I got a note from an independent writer, John Joss, who recently got a copy of The HP Phenomenon. He wrote, "Chuck,I am absolutely gobsmacked at your immense
effort with the book. The level of detail and historical accounting is staggering. I am, quite literally, in awe at what you have done."

I had to look up the word. Joss is British, fitting since the word is British slang for "awestruck, dumbfounded, as in so surprised that you clasp your hand over your mouth"

Joss continues: "I hope you're slaving over a new edition with the Hurd/Apotheker transition, since this is in its own way as fascinating--not entirely in the gossip
sense--as the pretexting subject. But of course the enormity of the corporation makes it very much a moving target. Also, for a reviewer, a bit like the blind men describing an elephant: wall, tree trunk, rope."

Thursday, March 3, 2011

a kinda slow February for HP

The first quarter earnings report was really quite interesting for the "HP Student"
Consumer-facing products, e.g. PCs and such, down 12%. Hummn. Along with the 'new' HP version of the i-PAD, announced a week earlier, which got reviews ranging from tepid to scathing. Hummn. And then yesterday, the i-Pad 2.0 with Steve Jobs himself going on-stage despite his medical leave of absence. Prediction -- as it once was, HP is once again struggling with the consumer side of things, for lack of excitement and Wow factor. Margins, which hit 6.4% (highest on record for a long time), will get hurt; revenue will get hurt more.
Does it matter? Probably not, in the middle term.
Services was down 2%, and margins were under pressure, according to the same press conference. But -- and it is a mighty big "BUT" -- this is essentially the largest segment of HP's total business revenue today, and the margins are 16%, not 6%. Guess what. This is the one that matters. This is the one where HP creativity, and EDS relationship building, can put new lead in the pencil, so to speak. Small wonder that this is where Apotheker moved to restore salary cuts, to help strengthen morale in a group that felt under-loved.
Does it matter? Absolutely, short-term, middle-term, but especially long-term
Printing and imaging. Up, surprisingly, 7%, with 17% margins. Same size as Services, same margins, still growing. Whew! This one perennially feels like it is vulnerable, but somehow keeps delivering. And the emphasis on commercial grade hardware units, up 33%, has to feel like a punch in the arm. Without it, and without ink, the rest feels plateau'd, but if this can stay the course for a few years, it will be the cash-cow HP has to have to make real inroads into the newer arenas.
Does it matter? Yes, for the short-term, and yes for the middle term. For the long-term, this is still best thought of as an annuity.
Which leaves servers and enterprise level stuff. And here there is a real story. Note that PCs for Commercial Clients were up 11%, servers were up 22%, and the i-Pad 'answer' and the Palm WebOS are all being positioned as Enterprise Tools. Margins for the aggregate approach 15%, with an aggregated growth with Software of better than 15%. This is the 'new' version of the 'old HP' -- not the one of voltmeters and scientific measurement, that divested long ago -- but the 'hardware centric' side of HP. This, not the consumer side, is the sweet spot for HP, just as IBM realized when they sold their PC group to Lenovo. Yes, HP has done a terrific job viz Dell and Lenovo and the old IBM PC guys, and their printers are still the class act (though tell my wife that as her 'high end home office machine fails yet again), but this set of focused products is where HP's edge can still shine, and is about to see even more emphasis. Shane Robison's focus for several years has been in this area; it has been a semi-invisible story, but believe me, it is crucial to HP's future. And the evidence is actually looking good, if we believe these numbers.
Does it matter? Didn't I already make that case?
Finally, what's to make of a quarter that is UP 27% in GAAP (or non-GAAP) earnings, given how tight a ship the last guy reportedly ran? This is an anomaly that is hard to understand. Yes, margins improved, but 27% is astonishing for a company that is up 4% overall in revenue. And it happened in a quarter when R and D got 're-invigorated' and salary cutbacks got restored, so everything is counter-intuitive here. I know Hurd took huge salary and perks for himself and a few others, but the firing bonus doesn't get compared until 3rd quarter -- what are we missing here? Nice that it went in the right direction for shareholders -- its time that they and employees both get treated well at the same time.

Monday, January 24, 2011

what is the early verdict

So, what is the news out of HP re Apotheker, now that we have a couple of months?

First, he was successful in fending off the subpoenas from Larry and team re the SAP / Oracle mess, so that's a plus. He really wasn't particularly in hiding, working daily from his office at HP headquarters during those first harassing weeks.

Second, he reportedly re-instated some of the salary cuts that draconian Hurd instituted to boost profits.

Third, he reportedly re-instated some of the R and D cuts that ...

Fourth, he announced a few personnel changes, including a shift in Corp Mktg director, and Corp Communications director. These did not play quite as well as points two and three; they instead generated some top-level angst about "SAP folk coming in"

Fifth, he and Ray Lane announced a sizable Board shuffle -- adding a couple of high-tech veterans, and more international perspective.

Sixth, the rumor mill swirls, as the Wall Street Journal circulated a story that HP immediately disclaimed, re Executive shuffle.

Certainly, the announced dividend and statement that the quarter is "on track" were affirming, and the stock price is back to where it was before Hurd's unexpected departure, but we'll know more by Feb 22 or so how HP is faring in fact in the market.

The followup blogs on the new Board, especially on the two women ex-CEOs, have not been very charitable, most noting that each had relatively undistinguished records -- but then, too, it has been a rough time for 'standard procedure'. That is maybe the bigger rap -- "HP has long since lost its leadership mantle, and this new Board shows nothing different in that regard."

Let's hope instead that we're about to see some further positive news

much ado last week for the HP Board

New stories around the HP circuit. First, the Board is being recrafted. Four members are stepping down in the March re-election, kind of unheard of since Packard cleansed the Board in 1992. Joel Hyatt, John Joyce, Robert Ryan, and Lucille Salhany are all declining to stand for re-election; two of them reportedly for backing Mark Hurd 'too long' in the acrimonious debate about his stewardship and eventual resignation.

The new members include the by-now well-known Meg Whitman, a nearly as well-known Pat Russo, and Gary Reiner, Dominique Senequier, and Shumeet Banerji. The pedigrees read well, certainly in terms of worldly connections and high accomplishment. But so did the last group, in the main.

What makes for a great Board Member? And what distinguishes great boards?

Unfortunately, it seems hard to get very balanced opinion, even from avowed and acknowledged pundits. For example, one of the most celebrated (certainly in terms of proferred quotes) Corporate Governance experts, Charles Elson at the Univ of Delaware is Director of the John Weinberg Center for Corporate Governance there, opined Friday last week that "four directors going out at once is unusual. Boards should not have this much drama.... They are all quite respected. The question is why?"

Elson knows better. He even said better last summer. The strongest of course then was Joe Nocera with the New York Times, who wrote: "it ginned up a tabloid-ready scandal that only serves to bring shame, once again, on the HP Board.... The last time the HP Board did something shameful ... was the famous 'pretexting' scandal...."

But Apple's board consisted of great luminaries, from the tech industry. Eric Schmidt and Bill Campbell, for example, and Jerome York and Al Gore from the national scene. And they were, and still are, uniformly assailed for a variety of sins, even as the company has shown spectacular performance. But they haven't ousted their leader.

HP, recall, under Hurd showed great performance improvement, if only for a time. Cheating the future almost always helps the present. So, now we have change, at the Board level. One step at a time....