HP’s decision to end its webOS hardware activities, placing doubt on the future of the webOS platform, came as a real surprise. In recent months, the company has been bullish about the potential of the platform, including the possibility to extend its use beyond smartphones and tablets into printers and PCs, in order to create the largest possible user base.

But in a wide-ranging strategic review, this business fell out of favour, with the potential for it to now end up among the long list of costly corporate missteps – HP paid US$1.2 billion to buy webOS' founder Palm, even before it had spent any cash further developing the platform or bringing products to market.

In a smart device world dominated by Android and Apple, bringing a new platform and product line to market was always going to be tough. In terms of customer demand, vendor support, and developer interest, success generates more success, driving a technology further onward and upward. Despite the sterling efforts of Palm and the early work HP did to bring products to market, webOS was always going to face something of an uphill battle as the new kid on the block.

But it should be noted that webOS was not HP’s first effort in the smartphone market, and its previous efforts were similarly not covered in glory. Building on the market leadership of Compaq’s arguably iconic iPaq product line, it offered a range of Microsoft-powered PDAs with integrated mobile connectivity. But in a market where operators still controlled the distribution channels, it did not have the reach to deliver the levels of success of its rivals.

Contrast this with HTC, which bent over backwards to woo the operators with its Microsoft-powered PDAs (such as the O2-branded XDA), even putting its own identity on the backburner in the early years. HTC is now an acknowledged smartphone leader in its own right, while HP, the established blue-chip incumbent, has opted to move out of the technology industry’s fastest-growing sector.

HP should have been on safer ground with the TouchPad. In general, despite some attempts by operators to offer devices bundled with service contracts, these devices are sold through consumer electronics retailers – where HP already has a great reach through its PC business. But while Apple’s iPad is selling like hot cakes, the huge range of vendors looking to earn a significant share of this market means that for everyone else – including Acer, Dell, Motorola, RIM and Samsung as well as HP – this space is extraordinarily competitive. And the TouchPad just didn’t stand out.

One area where both Apple and the Android-based tablet makers stand to benefit is the fact that versions of the same OS are also used to power smartphones, and smartphones are where the real device industry volumes are. Building up a base of Pre and Veer users would have helped HP create some momentum for webOS, even if this was something of a loss-leader in the early years – but the failure to secure strong operator support hampered this. With the TouchPad being launched to lukewarm reviews, and priced at a level that did not make it stand out from its rivals, the company was snookered with both its smartphones and its tablets.

Even before HP said it would end its device hardware activities, it was reported that the company was looking to licence the platform to third parties. The fact that it has chosen to make an announcement that has thrown the future of the platform into doubt is perhaps a clear sign that such a deal is not likely to be forthcoming. And if one was a vendor in negotiations with HP, the fact that the company sees no future for the platform in its own products is hardly a ringing endorsement.

But following the announcement that Google is planning to buy Motorola, it is possible that a member of the Android camp less than happy about the change in situation may decide to look further afield, and may see the potential in webOS. While Samsung has, sensibly it now seems, always kept bada burning in the background as a controlled smartphone platform, LG Electronics and HTC (among others) have pinned their smartphone futures on the whims of Google and Microsoft – with the latter now closely aligned with Nokia.

Where HTC and LG have a stronger hand is in relationships with operators, and established device propositions. Certainly for LG, which has lagged behind its top-five rivals in moving to smartphones, webOS could provide an attractive platform to help migrate its existing mid-tier handset line (and customer base), while enabling it to maintain its Android and Windows Phone 7 propositions to target more advanced users and devices. However, LG has also made some noises about supporting MeeGo, and may feel it already has its bases covered – especially as HP’s webOS intentions are still not fully clear.

Perhaps the most interesting question is what HP does with the mobile assets it now holds beyond the webOS platform. Through its acquisition of Palm and its development of its own devices, it undoubtedly has a strong mobile team sat twiddling its thumbs. And again, through both its own efforts and through the acquisition of acknowledged smartphone pioneer Palm, it will have an impressive patent armoury at its disposal – certainly not something that could be said of Google and Android.

With the way the industry is moving, and the ability to win in a patent battle seemingly as important as quality products, perhaps for someone out there HP is the perfect partner…

Steve Costello

The editorial views expressed in this article are solely those of the author(s) and will not necessarily reflect the views of the GSMA, its Members or Associate Members