This deal underscores the velocity of mobile and how that speed is affecting long term winners and losers. Many had written off Palm's relevance in the market, which might have been a correct assessment if Palm had ended up elsewhere. But I think Palm found a good home. In addition to Todd Bradley, the former CEO of Palm who now leads HP's Personal Systems Group, there are many Palm alumni at HP. This means that there should be a relatively smooth transition and overall good cultural fit. That's important because time is of the essence -- the market won't wait around for HP to integrate Palm.
HP's short term challenge is to survive the mobile market's velocity. There is precious little time to integrate Palm into HP offerings, decide what to do with existing HP products like the Windows 7-based Slate, Airlife Android smartbook, and iPaq handhelds, and create an effective marketing message while increasing customer and developer evangelism. The key will be creating close ties to other HP services for both businesses and consumers, and finding the language to create a story that can resonate across the board to HP customers and partners.
The combination of Palm's technology and brand with HP's resources and channel partners will allow HP to drive its mobile efforts forward.
These efforts will not only apply to phones but to devices like tablets, netbooks and other connected screens. webOS works quite well on phones but it's going to be interesting to see how it plays on new emerging categories of connected devices. While "three screens and a cloud" might be archetype of the digital consumer, webOS has the potential to work on 30 screens as it reaches many different types of devices.
It's H/Pre that will ultimately have to prove itself in a fast moving market place. The core ingredients are there, but it's time to execute the recipe and sell the dish.
Michael Gartenberg is a partner at Altimeter Group. His weblog can be found at gartenblog.net. Contact him at gartenberg AT gmail DOT com. Views expressed here are his own.