The Operating System Platform That Just Won't Die

Can the third time finally be the charm for webOS? The star-crossed operating system has now seen two commercial failures under two separate corporate umbrellas. It's time for webOS to find its third home. It's about time, too, since the platform has needed one since 2011.

A gloomy trip down memory lane
Of course, its first home was Palm, where it was created. Despite being widely regarded as an innovative platform with intuitive gestures, webOS wasn't enough to save Palm, as its devices failed to deliver where it counts: sales.

In some ways, Palm's failure was a byproduct of bad luck and carrier ambivalence. In 2009, Palm was about to score a huge distribution and marketing deal with the Verizon (NYSE: VZ  ) , the largest domestic wireless carrier. Big Red abruptly flip-flopped and decided to bet big on Google (NASDAQ: GOOGL  ) Android and a joint Droid marketing campaign that proved rather successful. That left Palm out in the cold and it was relegated to an exclusive deal with Sprint Nextel, the third-largest carier.

Hewlett-Packard (NYSE: HPQ  ) thought it could fare better, and scooped up the company in early 2010 in what may have been the worst deal ever, paying $5.70 per share for a company that many thought was headed to $0. Indeed, HP would soon end up writing off $3.3 billion -- more than the initial $1.3 billion acquisition price. That was after ex-CEO Leo Apotheker axed webOS hardware, and about the same time that his replacement CEO Meg Whitman effectively donated it to charity by making it open source.

Pack it up
webOS will now be flying under a South Korean company's flag, as LG now hopes to give it a shot. The doomed platform is not likely to make its way back into smartphones and tablets of the future, and instead the company is reportedly looking to repurpose it for a new lineup of smart TVs. However, LG didn't rule out this possibility altogether.

Like most mobile hardware OEMs in this day and age, Android devices of various sorts dominate LG's smartphone lineup. There were already rumors swirling late last year that LG was looking at using webOS for a smart HDTV, but now LG is taking that a step further and acquiring the webOS division, which will include the source code, documentation, and engineers. The webOS team will join a new research and development lab that LG is setting up in Silicon Valley. HP will keep the webOS cloud services division.

LG had reportedly been contemplating which platform to use for its smart TV push, with the two primary candidates being webOS or Google TV. Not only has Google TV had its fair share of missteps as a platform, but Big G supposedly wanted too much control over the interface and experience of its platform, which was gently nudging LG in the general direction of webOS in the first place.

A new parent
It's a surprising turn of events for webOS, as there were plenty of potential suitors that were reportedly remotely interested in webOS two years ago. Everyone from e-tail giant Amazon.com to Taiwanese OEM HTC to smartphone fallen angel BlackBerry have been named as expressing interest at one point or another. Even IBM, Oracle, and Intel were rumored to be interested in the related patents.

Those rumors were a year and a half ago, and talk of anyone acquiring webOS had died down in recent times. At least LG probably didn't have rival bidders to compete with and is likely paying very little for webOS, although no financial terms have been disclosed yet. HP had written down the carrying value of its intangible assets and goodwill related to Palm to just $273 million at the time. HP is keeping all of the patents related to Palm and webOS and LG is merely licensing them.

Can LG give webOS a good home?

The massive wave of mobile computing has done much to unseat the major players in the PC market, including venerable technology names like Hewlett-Packard. However, HP's rapidly shifting its strategy under the new leadership of CEO Meg Whitman. But does this make HP one of the least-appreciated turnaround stories on the market, or is this a minor blip on its road to irrelevance? The Motley Fool's technology analyst details exactly what investors need to know about HP in our new premium research report. Just click here now to get your copy today.


Read/Post Comments (2) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 25, 2013, at 9:21 PM, marv08 wrote:

    Well, I really liked WebOS and I think, until today, it was the best-done alternative to Apple's iOS. It was good-looking, easy to use, a lot of thought went into it... almost perfect. But they had insufficient funding to come out with respectable hardware, they started too many idiotic fights (like hacking into iTunes, or the completely ridiculous appearances and claims of that jerk McNamee) to get anywhere. They did not get a second chance to make a first impression...

    Now, HP made it Open Source. The project does seem to achieve a monthly blog post as its only output... But every single article covering the LG deal fails to answer that simple question: how can you sell something you have made Open Source? What does that mean for either side? How can HP collect licensing fees for something it made available freely? What is the meat here?

    These are interesting questions (IMHO). What WebOS will do for LG TV sets? Heck. Nobody knows. All the talent that created and designed WebOS has long moved on. Will LG all of a sudden mutate into a tasteful, cool and efficient software house? Will people look into their "smart TV's" crappy menus more than once, or just shudder and forget about it, as they have always done? I guess I know that answer...

  • Report this Comment On February 26, 2013, at 3:25 AM, marv08 wrote:

    Evan?

    You never answer to any of your bullsh..? Are you really just an an alias of the most retarded "fool" ever (I obviously speak of Anders Bylund, Hitler's last fortress of stupid in Europe)?

    Hey, don't just choke on that bretzel... say nothing.

    Oomph... my dog is more intelligible.

Add your comment.

DocumentId: 2276116, ~/Articles/ArticleHandler.aspx, 7/23/2014 12:29:16 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement