Lenovo waltzes past HP as world’s largest PC maker

China-based Lenovo Group has become the world’s number one maker of personal computers.

Research firm Gartner reported on Wednesday that the Chinese company knocked California-based Hewlett Packard from the top spot in the third quarter of 2012.

“We are establishing even deeper roots in each major market around the world. In addition to localised sales and distribution teams in major markets, we are establishing an even stronger manufacturing footprint,” Yuanqing Yang, Lenovo Chairman and CEO, said in a statement about the continued growth of the $8.2bn company…

The Chinese company, which vaulted into the PC market by buying IBM’s personal computer division in 2005, took the top spot for the first time by growing its market share to 15.7 per cent, shipping an estimated 13.77 million units during the quarter, up nearly 10 per cent from a year ago, Gartner said…

Overall, however, global demand for personal computers dropped over eight per cent last quater because of the rise of portable gadgets such as tablets, as well as a slowing economy.

Lenovo’s rise highlights the advance of China’s technology firms on the world stage in recent years as a result of aggressive pricing, overseas acquisitions, and taking advantage of a fast-growing home market.

This year the company has bought Brazilian electronics maker CCE, valued at a base price of $148mn, and US cloud computing firm Stoneware.

Good grief. Hasn’t the Party-formerly-known-as-Republican discovered this was happening? Surely this must be another reason for several of the Congressional committees they control to waste more taxpayer dollars in hearings aimed at building more fear and trepidation among voters.

The real Tablet Wars will have to wait until next year

Even with the much publicized release of the Galaxy Tab this week, it looks like the real battle to upend the iPad won’t happen until next year. Lenovo’s chief executive confirmed that its LePad tablet won’t hit the market until 2011. LG also pushed back the release of its tablet until next year. Both are waiting to launch their tablets with Android Honeycomb, the upcoming release that is designed for tablets. Meanwhile, those who want RIM’s BlackBerry PlayBook or a webOS-based tablet will also have to wait until early next year.

This isn’t to say that competitors aren’t lining up offerings right now. Samsung is predicting it can sell 1 million Galaxy Tab devices running Android 2.2 by the end of this year. Acer is expected to unveil new tablets running Android later this month. And Dell has released the 5-inch Streak, which runs an older version of Android.

But Google has said that, currently, Android isn’t designed for tablets. And it looks like Gingerbread, the update that is scheduled to be released any day now, won’t be optimized for tablets. So Android tablets, even if they’re released this year, probably won’t hit their stride until Google releases Honeycomb.

Right now, manufacturers are torn between moving forward and trying to get some traction like Samsung is attempting to do, or waiting until the platform matures, but risk Apple zooming ahead again with the iPad 2. That some like LG and Lenovo are sitting it out suggests they’d rather nail it the first time with the right software rather than put out something that initially disappoints…

The iPad will surely get serious competition and will undoubtedly lose its 95 percent share of the tablet market. But it looks like we’ll need to wait for next year when Android tablets, along with a BlackBerry PlayBook and a webOS tablet from HP, can make a real run at the iPad.

Many of these firms make it sound like they’re getting better at responding to Apple’s R&D opening new marketplaces. I’m not as convinced. It takes a great deal of process management to accomplishment a complete rollout for a breakthrough product like the iPad. It also helps to have an infrastructure like the App Store + apps + designers ready and willing to design for the new platform.

The only product I see stealing market share from the iPad is this. My wife’s arrives Monday.

HP to pay $16M for joining corrupt Texas schools consortium

End product – from the people HP bribed to influence

Hewlett-Packard will pay more than $16 million to settle a lawsuit alleging they violated competitive bidding rules with the Houston and Dallas school districts to win technology contracts, the Department of Justice announced…

The DOJ inquiry that led to the settlement was triggered by a 2007 whistle-blower lawsuit filed in Houston by Dave Richardson and Dave Gillis…

Richardson, who owns an insurance company, became suspicious when his business dealing with HISD dried up. After enlisting the help of former FBI agent Gillis, they discovered what appeared to be sweetheart deals regarding technology purchases, including the lucrative federal program known as E-rate, which funds internet connections for schools and libraries.

They took their findings to the government and said, ‘You need to do something.’ Not much was done, so they filed the lawsuit,” said their attorney, Travis Crabtree… Did anyone think the Bush administration would come down on the side of honesty in Texas?

The investigation accused Houston businessman Frankie Wong of setting up a group of companies, including Hewlett-Packard, that came to be known as “The Consortium.” They applied for technology contracts with both HISD and the Dallas Independent School District.

Because of their close connection with district officials, thanks to the suspect gratuities, the bid requirements were worded in such a way that only they could satisfy them, officials said.

More lawsuits from other firms screwed by the Consortium proceed. The Obama DOJ will intervene as needed on behalf of the plaintiffs.

Texas school boards will continue, of course, without tempering any of the corrupt ideology guiding their practices.

HP CEO Mark Hurd resigns after sex probe

Daylife/Reuters Pictures used by permission

Hewlett-Packard Co.’s Mark Hurd resigned as chief executive officer after an investigation found he had a personal relationship with a contractor who received numerous inappropriate payments from the company.

Chief Financial Officer Cathie Lesjak, 51, will take over as interim CEO. While an investigation didn’t find a violation of the company’s sexual-harassment policy, Hurd “demonstrated a profound lack of judgment that seriously undermined his credibility and damaged his effectiveness in leading HP,” General Counsel Michael Holston said.

Shares plunged 9.3 percent in late trading after the announcement.

The departure leaves Hewlett-Packard, the world’s biggest maker of personal computers and printers, in search of a new CEO and chairman after more than five years under Hurd. On his watch, the Palo Alto, California-based company regained leadership in the PC market from Dell Inc. and used acquisitions to expand into new areas, such as computer services. The company’s stock-market value increased $44.6 billion, rising to $108.1 billion, since Hurd took the helm on April 1, 2005…

HP initiated the investigation on June 29 after the contractor made a claim of sexual harassment. The woman, who HP declined to identify, worked on marketing tasks for two years, the company said. The probe found violations of HP’s standards of business conduct, though it didn’t find violations of the harassment policy.

Hurd submitted receipts for expenses ranging from $1,000 to $20,000 over two years, including meals and travel, that should have been labeled as personal and not related to business, said a person familiar with the situation. Hurd, who is married and has two children, intends to pay the company back the entire amount.

Hurd will get a severance payment of $12.2 million, plus other benefits; so, don’t worry too much about whether or not he can afford his country club membership.

Hurd is also on the board of News Corp.

Which will give Ol’ Rupert a chance to moralize. Or not.

No Windows smartphones for HP

HP might aspire to be “Microsoft’s biggest customer,” according to HP executive vice president Todd Bradley, but the company has officially distanced itself from Microsoft’s Windows Phone 7 mobile operating system. The move should come as little surprise, given HP’s finalization of its Palm acquisition late last month.

Palm, after all, is the brains behind the webOS mobile operating system, which HP now intends to use as the basis for all of its future smartphones…

The decision comes in the wake of a suspicious amount of shuffling regarding the HP Slate—first intended to launch this year as a Windows 7-based tablet, then pulled in favor of Palm’s webOS, and now apparently resurrected as a Windows-based enterprise-class device.

That’s not to say that webOS is going anywhere, however. According to Ars Technica’s Ryan Paul, HP appears to be adopting a two-platform strategy for its Slate tablets: enterprise customers get the Windows versions, and the general consumer market gets webOS.

Regardless, Microsoft is out on HP’s smartphones. It’s not a huge chunk taken out of the Microsoft’s business, given that fellow manufacturers ASUS, Dell, and Samsung—amongst others—have all signed on as Windows Phone 7 partners. Nevertheless, HP’s move is made even more interesting when one factors in the talk of the market before HP’s acquisition of Palm.

“We are simply very excited to be entering a new era in our Smartphone business together with Microsoft, especially as the market continues to grow and evolve. HP is working even closer with Microsoft to develop signature phones on the Windows Phone 7 Series that offer an entirely new consumer experience,” said Steve Manser, a senior vice president at HP, in a series of partner statements put out by Microsoft.

Once HP acquired Palm for $1.2 billion, however, executives were singing a different tale.

Ayuh. Lifetime commitments sometimes don’t outlast quarterly reports in the marketplace.

The only real surprise about the article – is that they managed to get all the way through without mentioning Apple.

Who was Company C?

Hewlett-Packard landed Palm by raising its bid following interest from other suitors after intellectual property and a potential licensing arrangement for the WebOS…Simply put, HP almost fell short of acquiring Palm. Palm’s outlines the process to sell itself and the role of “Company C,” an unnamed outfit that was in the running until the HP deal was actually announced…

Palm said it received interest from 16 companies including HP. Six including HP entered nondisclosure agreements:

The two companies in addition to HP that presented acquisition proposals are referred to as Company A and Company B. A fourth company, referred to as Company C, had initially been in discussions with Palm regarding an intellectual property transaction and later made a proposal to acquire Palm.

A fifth company, referred to as Company D, contacted Palm on March 18 to discuss an intellectual property transaction but did not make a proposal to acquire Palm. Company D did not enter into a nondisclosure agreement and did not review non-public information about Palm. Discussions with Company D continued intermittently until April 15.

The one common thread with all of these suitors? They wanted intellectual property transactions and many of the potential buyers were as interested in a licensing arrangement for things like the WebOS. However, an IP deal wouldn’t help Palm all that much…

On April 24 Palm’s CEO and advisors communicated to HP and its advisors that, to remain in the process, HP must improve its offer significantly and immediately. Later that day, HP’s financial advisors verbally delivered a proposal to acquire Palm for $5.70 per common share in cash. HP’s financial advisors also requested a five-day exclusivity period. On April 25 HP delivered a letter confirming this proposal with a target announcement date of close of business on April 27 and sent a draft exclusivity agreement covering such period on April 26.

While much has been made about five bidders for Palm, it appears to be a two-horse race between HP and Company C, which could logically be Lenovo and Dell or a few others. When HP matched, Company C declined to go higher, but Palm notes the bidder proposed “an alternative transaction under which it would acquire certain patents and take a nonexclusive license to Palm WebOS in exchange for a one-time cash payment of $800 million.”

The big question revolves around the identity of Company C. Obviously, Company C felt it needed a mobile operating system badly. HP also decided it needed the WebOS too…

Palm couldn’t come with the marketing smarts to rebuild lost opportunities.

HP thinks the WebOS is worthy – and they can make it profitable, a significant addition to their portfolio. But, who was Company C?

HP and Acer are developing Google Chrome OS netbooks

Netbooks running Chrome OS, Google’s newly announced operating system, may be available later this year, according to a report from Reuters, which quoted Google chief executive Eric Schmidt at the Allen & Company media and technology conference in Sun Valley, Idaho, on July 9.

“Everybody we’ve talked to under nondisclosure is excited about the plan,” Schmidt told Reuters. “So hopefully later this year we’ll see some announcements.”

According to Reuters, Hewlett-Packard and Acer are working with Google to create devices running Chrome OS, which was designed to better exploit the Chrome browser and modern Web services, such as online applications.

Google introduced Chrome OS on July 7, just nine months after its Chrome browser, which already has nearly 30 million users, according to Google. Initially, the Google team said there would be some overlap between Chrome and Android — Google’s mobile operating system, used predominantly on smartphones — but that the two would still be very distinct.

Speaking on July 9, however, Schmidt told Reuters that the two products are closely related and could eventually “merge even closer.”

Poisonally, I think Eric Schmidt has learned a thing or two from both Bill Gates and Steve Jobs about managing the press – especially geek press.. And there’s nothing wrong with that.

I have to chuckle over industry analysts and pundits who prate about business strategies as if there’s some collegiate rulebook governing the dialectic of competition. Har!

Cisco Unified Computing – the hardware for Cloud Computing 2.0

This may stretch the geek attention span for my regular readers. I go all the way back to discussions of the semantics of programming languages in the early 1960’s. I’ve been online since 1983. I’m married to a banking IT maven. You get the idea…

Cisco Systems has announced its new blade server, first reported by us in March 2008, along with a Unified Computing strategy that converges storage, compute and networking into a single layer (thanks to virtualization technologies) that is managed by a specialized piece of software. Stacey has captured the intricate details of the news, while I have already posted about the imperative behind these moves.

This new comm-puting approach adopted by Cisco is unique, in that it is the first time a company is selling a single packaged offering so to speak. People have sold either storage related equipment, or network layer gear or just servers. So, what does Cisco’s announcement mean for existing vendors?

Prior to Cisco’s announcement, Sun Microsystems and eGenera, a Marlboro, Mass.-based early stage company have often talked about such a unified, network centric future. Even IBM takes a holistic view of the data center.

Cisco, by virtue of being a late comer to the market, has managed not only to lap them, but has also posed a serious challenge to two major blade server makers – Hewlett-Packard and Dell. You can put Rackable in this category as well, but it’s a small player compared to these behemoths. One of the main reasons these companies are at risk is because they have typically innovated on cost and performance metrics, not a whole 360-degree view of the changing data center infrastructure. Google, as a company, has reinvented data centers by building its own gear, and taking a holistic approach to the data centers.

RTFA. Click all the links. Knock yourself out.

HP finally hops onto iPhone bandwagon – right after Microsoft

HP may have plans to compete with Apple in the smartphone market, but that doesn’t mean it can ignore the iPhone.

This week, HP announced iPrint Photo, a free application now available on Apple’s App Store for the iPhone and iPod Touch. iPrint Photo is designed to let customers easily print photos wherever there’s access to a wireless network and HP printer…

Like thousands of other free applications on the iPhone, iPrint Photo won’t generate any money for HP directly, but anything that encourages printing stands to be good for the computer and printer giant’s bottom line.

Another big Apple rival, Microsoft, released its first iPhone application earlier this month. Seadragon, available for free at the iPhone App Store, is designed for advanced image browsing. It can be used, for example, to zoom far in on an image or to browse a collection of images on a single screen.

Glad to see the “industry leaders” are really on their toes. The fracking iPhone is in its 2nd Generation and they’re just getting round to getting into the app store. That puts them about #10,001 and #10,002 in line.

Just when you thought your crotch was safe…

Last time around

Three of the biggest laptop computer makers are recalling certain batteries because of a risk they may overheat and catch fire. Sony made the batteries and the recall mirrors — yet appears a lot smaller than — a similar one that occurred two years ago.

This time, around 100,000 batteries are affected, a fraction of the 9.6 million recalled in 2006. Dell, Hewlett-Packard and Toshiba have already issued recalls for the batteries that were used in their products and the U.S. Consumer Product Safety Commission said “consumers should stop using recalled products immediately.”

The batteries in question were manufactured between October 2004 and June 2005 and to date there have been about 40 incidents reportedly globally of overheating, said Sony.

Of the 100,000 batteries affected, around 35,000 were used in laptops shipped in the U.S. By far the greatest number, about 32,000, were shipped with HP laptops.

Identifying codes are in the article. Click the link above to see if you’re one of the lucky ones.