webOS TouchPad: Microsoft Should Fear HP More Than Apple

While Apple had stolen the spotlight from the tablet computing space that Microsoft’s Bill Gates had hoped to define with the Tablet PC about a decade ago, it is HP that Redmond, Washington should fear. With the announcement of the TouchPad representing a new form factor that HP will attempt to tackle in addition to the smartphone space that it had acquired from Palm–a Microsoft rival in the PDA and smartphone business with Palm OS of yore and now webOS–HP had stated publicly that it will aggressively try to place webOS into other form factors.

For the first time, Microsoft’s partner in the PC space had declared that it would try to encroach in the space that had made Microsoft a dominant player. HP has said at its TouchPad unveiling event that in addition to smartphones and tablets, webOS will be coming to the company’s Internet-connected printers, and also to desktops and laptops.

In terms of desktops and laptops, it’s unclear how HP will be leveraging its newfound software business in webOS or its hardware business with the platform. Whether the company will scale webOS upwards to become its own desktop OS to compete with the likes of Apple’s Mac OS X, Microsoft’s Windows, or Google’s Chrome OS, or if the company will use webOS as a dual-booting OS to give PC users an instant on experience is unclear. If the company really is thinking big, like its press slogan for the San Francisco, California unveiling event reads, then creating a desktop webOS operating system may be key to competing with Apple as it will give HP scale, a nicely integrated ecosystem, and leverage with developers. For this to happen, webOS really needs to scale up to fit the environment into which it will be placed. The platform will probably need to be re-tooled slightly to become more extensible and powerful so that when placed in a laptop, webOS won’t feel like a smartbook or under-powered netbook. That solution, if it is to be competitive against Windows and OS X, will need to perform and offer more than a Motorola Atrix 4G in its laptop dock.

While Apple may have started on the desktop to scale OS X down to iOS on the mobile, webOS scaled up can have a lot of implications for HP. First, it may allow the company to be a software company that no other Windows PC-maker is at this time to compete with Apple. Second, as HP is the largest PC maker, extending webOS to its PC line may boost developers’ confidence in webOS to create more apps for the company’s smartphones and tablets. And third, it will give HP the resources to compete against Palm and establish a halo product within its own ecosystem. A Pre owner may now be tempted to buy a TouchPad, thanks to the “Touch to Share” feature, and then may be enticed to purchase an HP laptop as a result thanks to tie-ins, like the Synergy engine, Touchstone capabilities, and a nice, closed, but well integrated, ecosystem.

As the world’s largest PC maker branches out into software and will be loading its own in-house software into its PCs, Microsoft may see a more credible threat in HP than from Apple or Google. Will–in terms of market share–the world’s largest software-maker lose the world’s largest PC-maker as a licensee of Windows?

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