Generally, divorces are messy affairs, with the parting of an industry powerhouse holding the potential to be Hollywood box office material.
Played out in the public arena, the carving up of the then 76-year- old institution was the splitting of the technology atom, creating two new publicly traded Fortune 50 companies in the process.
On paper, Hewlett Packard Enterprise (HPE) had the winning hand — a play deep within the lucrative data centre market, a story enterprise wanted to hear and a leader in Meg Whitman.
Analysts however remained pessimistic about PCs, unmoved by printers and concerned at the prospect of HP going it alone.
“If you cast your mind back, the prognosis pre-separation was concern for HP,” HP managing director of South Pacific Rob Mesaros recalled. “There was a big question in the market about what would happen to HP post-separation.”
But as HPE headed for the data centre, HP homed in on personal systems and printing, delivering growth on both sides of the business to surpass Wall Street expectations.
“The catalyst for our strong performance has been separation,” Mesaros added. “Separation liberated us to be what we wanted to be. We were a centre weight but now we stand for something.”
For Mesaros, the genesis of the separation was to create an organisation operating on a different level altogether, in terms of renewed focus, investment and innovation.
“We are a leaner and more agile organisation,” Mesaros said. “We’re thrilled with the outcomes of the separation because now perceptions are changing and eyebrows are being raised — HP is back and we’re innovating.”
Core, growth and future
Driven by a strategy built on reinvention, HP’s go-to-market framework is broken up into three key areas — core, growth and future.
As a leader in personal systems and printing, the vendor is aggressively defending and expanding core business opportunities across Australia.
Specific to personal systems, a further push into premium devices continues to dominate market efforts, backed up by aggressive plans to grow presence across commercial and gaming sectors.
To capture growth, HP is delivering new solutions designed to create a new standard for commercial mobility, while also investing in immersive computing, including virtual and augmented reality.
“Our channel partners have the opportunity to capitalise across all three pillars as we advance to growth and future markets, while continuing to invest in our core,” Mesaros added. “Technology is always the disruptor and now it’s about how quickly can we shift the market, and we’re mapping out our channel capabilities across these pillars to take advantage.”
From a print perspective, Mesaros said plans are in place to reignite consumer spending, boost office share while reinventing home and business product sets, alongside driving growth across managed print services.
Within this segment, disruption of the copier market through A3 will deliver growth, accelerated through the US$1.05 billion acquisition of Samsung’s printer business, which is expected to close before 2018.
Looking ahead, HP views 3D printing as its true growth engine in the long run, gaining traction with customers to operate at the core of the Fourth Industrial Revolution.
“There isn’t a competitor in the market today with our portfolio,” Mesaros added. “There are print competitors and there are PC competitors but we are the only vendor doing both.
“Why is that positive? It’s a wonderful portfolio which we think gives us a real advantage in the marketplace. We’re investing in print and PC unlike any other vendor and we’re accelerating our product portfolios.”
The critics will no doubt argue that HP is doubling down on two stagnating industries however, with both PC and print apparently consigned to the dust bins of history.
Particularly from a PC standpoint, it’s a line well used by cautious analysts incapable of deciding whether the rebirth and rejuvenation of HP represents a short-term fix to paper over the cracks or long-term investor value.
Today, the health of the market suggests the latter.
“Content is exploding across the world yet people said the PC was dead,” Mesaros observed. “In hindsight, how misleading and inappropriate was that comment?
“A PC is a device to either create, consume or distribute content. So, if you play this out, what does that mean for the PC market? Across Australia, the population is growing, GDP is growing and content is booming so on what grounds is the PC market dead?”
With the death of the PC greatly exaggerated, HP’s increased investment across personal systems is playing out in the numbers.
According to IDC research, HP continues to maintain the no.1 position in the traditional PC market on both sides of the Tasman, achieving its highest share result of 29.9 per cent across Australia and New Zealand (A/NZ) during the first quarter of 2017.
Specifically, the tech giant has maintained local market share above 25 per cent for every quarter since the second quarter of 2015, with the next closest competitor not exceeding 20 per cent since the first quarter of 2013.
“All of the naysayers said that vendors caught in the PC business would have a tough time,” Mesaros acknowledged. “But we quickly realised that pockets of potential growth existed across the market.
“PC is a big business to be in and opportunities are everywhere, particularly in premium. Not only has this offered access to a market that is far more lucrative, but the halo implications of having a premium offering has helped revitalise the HP brand.”
Leaving Dell, Lenovo, Apple and Acer behind, HP’s dominance comes as traditional PC shipments in Australia — including desktop, notebook and workstations — totalled 981,000 units in the second quarter of 2017, posting a year-over-year (YoY) growth of 3.3 per cent.
Based on the latest IDC research, the market posted yet another quarter of growth in 2017, defying global negative PC trends.