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HP to drop WebOS devices completely, may sell off PC unit

The future of the webOS platform is up in the air, just 13 months after HP acquired Palm Inc.

In a complete 180 turn, HP will be discontinuing all production and hardware support for their webOS-based devices, including the Pre smartphone series and TouchPad tablet. Its Personal System Group (PSG), which is responsible for developing PCs, could be sinking as well.

It wasn’t long ago when HP acquired Palm Inc. for their webOS platform. At the time, HP had high hopes for webOS and announced earlier this year a number of devices running the operating system, such as the Veer, Pre 3 and the TouchPad tablet. The company even had plans to expand the software to PCs and other electronics.

Unfortunately, consumers simply do not care about the webOS platform, to put it lightly. The Pre 3 smartphone was never released outside of Europe and the TouchPad had lukewarm reviews when it was launched just a number of weeks ago in July. Rumors earlier in the week pointed out that only 25,000 TouchPad units have been sold in Best Buy stores out of a stock of 270,000 in the United States. Instead of mending the problems, HP has now decided to abandon the sinking ship altogether.

Official support for webOS may continue on the software side, however. “HP will continue to explore options to optimize the value of webOS software going forward,” said the company in the related press release.

As for the PC side, HP is considering a “full or partial separation of PSG from HP through a spin-off or other transaction.” While HP did not explicitly state the reasons for such a move in the press release, DailyTech predicts that HP is simply not making enough money in the PC hardware business. Profits from budget-line notebooks and PCs are likely to be very low, unlike the premium-priced Apple MacBooks. This echoes a statement Acer made a few months back, where the Taiwanese company said that more expensive hardware is the answer, not budget offerings.

With the official discontinuation of webOS devices from HP, expect some deep discounts on the TouchPad as retailers get rid of the remaining stock.

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Allen Ngo, 2011-08-19 (Update: 2012-05-26)