03 May 2010

Smartphone Wars' New Force: Hewlett-Packard & Palm - Is that so?

Someone on my facebook posted and  Smartphone Wars' New Force: Hewlett-Packard & Palm - Barrons.com caused me to think.

When has putting two losers together make a winner? 
HP might be a leader in the IT market, printer market, but they are not at all in the Smart phone market. They were a leader in the PDA market but now that Smart-phone is here, the PDA is more or less on the decline. Palm Pilot was a excellent PDA and a leader there when it started way before the Microsoft enter the market with its Window-CE. How could both PDA leaders loose out in the Smart Phone war? They have all the strength. May to enter the Smart-Phone you need to win on Phone first before Smart. Nokia is holding on with its own. But Apple enter the smart-phone without any Phone or Smart-PDA strengths. It employs its iTunes & i Pod strength or music strength or mobility strength.

When does Cash Alone win a War?
HP may have deep pocket. But when does deep pocket alone make a lasting business? If this is true, there will be no Google and others including HP. The list of fortune 500 companies changed through the years. The formula for success seems to be some cash and a valuable breakthrough idea that covers a multi-faceted value proposition. iPod success is not because it is the best mp3 player. It is more about 99cents of the song you like on the move.

Who will win the Smart-phone war?
The leaders of the industries have all recognize that it is not features alone that win the war. It is the type of applications that run on it that makes the difference. We buy things that are useful to us functionally (rationally or utility value), make us looks cool and great (emotional, social status value) and with significance (what we believe in - e.g. pro-life, health, environment and community ). It is the platform or OS's or whatever.

Strength or Weakness is a Relative Term.
Most people makes the mistake of rating their strengths and weaknesses in silo or without context. Strengths or weaknesses should be rated according to the context of use. In business world, it is the opportunity or the market you are trying to exploit. They are to be measured from the context, an outside in view. They are to be measured by the customers, relative the competitors.

Back to HP and Palm. At their present market, their offering, a vector of factors of value proposition, is bad - that's why they are not doing well. They need to change their vector of value offering according to the market and their capabilities - the things that customers value and yet they are better than their competitors in delivering the values. A new vector of value proposition is needed.