HP Hedges Its Bets with webOS

Hewlett-Packard's decision to contribute its webOS mobile operating system to the open source community potentially breathes new life into the platform, but the prognosis that it will reemerge as a tangible threat to Apple's iOS, Google's Android or Microsoft's Windows 8 looks like a long shot.

The decision by HP to open source webOS and its ENYO application framework, announced late last week, was somewhat inevitable after months of trying to license or sell it to third parties apparently fell flat. What is surprising, though, is that HP isn't just cutting webOS loose but rather pledging to support the effort as "an active participant and investor in the project."

HP will retain a yet-to-be-determined number of employees on the webOS team, which now amounts to 600 people, HP President and CEO Meg Whitman told The Verge. Whitman also indicated that HP isn't done with webOS-based tablets after all, saying the company might offer new hardware, though she declined to say when, and she cautioned plans could change.

"As webOS gains traction as an open source alternative in the marketplace, you could see webOS on several different types of devices by any number of vendors," an HP spokesman said in an e-mail. "We will explore the viability of putting webOS on devices, just as we do for other leading operating systems."

The notion that webOS will gain traction is difficult to envision, considering HP's botched stewardship of the Palm platform to date, along with the market dynamics that are now playing out. Perhaps HP is trying to hedge its bets in case Windows 8 tablets aren't well-received or the Android market becomes untenably fragmented. Either one or both of those events, far from a sure thing, might create an opening for webOS if HP could create a viable ecosystem.

While the $99 fire sale of TouchPads showed HP that it could sell boatloads of tablets running webOS, unless the company can determine a way to defy existing economics and deliver them at that price-point profitably, it faces an uphill battle.

Besides the Apple iPad, though, no other tablet platform is a sure thing. It remains to be seen how customers will react to Windows 8 tablets, and while the $199 Kindle Fire appears to be the first credible threat to the iPad, today The New York Times is reporting that many people are returning them due to disappointing performance in those devices. Research In Motion's PlayBook has failed to gain critical mass, while Google Android devices have enjoyed limited success. As a user of a webOS-based smartphone myself, even though it lacks applications, I can say it's an appealing platform.

Nevertheless, when it comes to tablets, there is nothing to suggest that HP will create a market mover with webOS just because the company has decided to contribute it to the open source community. HP hasn't even determined an open source licensing model.

That's not to say that no good will come from HP's decision to open source webOS. Never underestimate the creativity of the open source community. But if HP is serious about investing in webOS, the company will need to flesh out this strategy sooner rather than later. Even so, the prospects that webOS will emerge as a spoiler in the tablet market remain slim.

Posted by Jeffrey Schwartz on December 12, 2011