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Sanity prevails at HP which is keeping its PC division

HP has announced that HP is keeping its Personal Systems Group, its PC division.

“HP objectively evaluated the strategic, financial and operational impact of spinning off PSG. It’s clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees,” said Meg Whitman, HP president and chief executive officer. “HP is committed to PSG, and together we are stronger.”

The strategic review involved subject matter experts from across the businesses and functions. The data-driven evaluation revealed the depth of the integration that has occurred across key operations such as supply chain, IT and procurement. It also detailed the significant extent to which PSG contributes to HP’s solutions portfolio and overall brand value. Finally, it also showed that the cost to recreate these in a standalone company outweighed any benefits of separation.

I am not surprised – it took me and many other observers about two minutes to reach the same conclusion back in August, when HP announced that it was considering a “spin-off or other transaction” for PSG.

I find it remarkable that HP did not conduct this research before, rather than after, announcing its uncertainty to the world. These last couple of months must have been challenging for the PSG sales and marketing team and costly for HP.

Nevertheless, good news for HP and its customers, and for Microsoft for whom HP is perhaps its most important hardware partner.

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