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5 Reasons to be Bullish on WebOS

Mar 9 2011, 12:25pm CST | by , in News | Technology News

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5 Reasons to be Bullish on WebOS
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Palm's dream lives on.

Back in 2009, Palm was still an independent company, and the webOS-running Palm Pre looked like it might be legitimate competition for the iPhone. We all know how that story ended. The Pre didn't sell well enough to keep Palm afloat, HP bought everything wholesale, and now webOS is coming to a tablet.

The TouchPad looks to be an exceptional product. But it is really just one part of HP's grand strategy to bring webOS from the brink of irrelevancy to the realm of ubiquity.

1. WebOS in Every PC.

As of Q4 2010, HP was the largest worldwide PC vendor. They shipped over 17 million machines at the end of last year and hold 18.8% of the market. Starting next year, every HP PC shipped will run WebOS. Potentially, this could mean millions of new webOS devices in customer hands every single month.

Every one of those new users will make the platform more desirable for developers. And, every customer with webOS on their PC will reap more benefits from buying a webOS smartphone or tablet. Familiarity is crucial when you're trying to spur the adoption of new technology. Millions of webOS PCs equal millions of customers who are now comfortable with the platform.

2. Full Ecosystem Support.

Competing tablet manufacturers aren't just fighting against the iPad. They're fighting against the iPad, backed up by the App Store and iTunes and Apple TV and MobileMe and OS X. Apple offers customers access to a whole ecosystem of devices and services. HP is in a position to offer something broadly similar. While they don't have an answer to iTunes, HP will offer webOS integration with every PC and printer they sell.

When they demoed the TouchPad at MWC, HP was very bullish on a feature that allows you to transfer data from your Pre to your TouchPad via a gentle tap. I'd expect that feature to extend to all webOS devices- which will now include every HP computer. You've also got WiFi printing capability (no drivers necessary) with any HP printer produced in the last five years.

3. Money. Products don't become popular without a lot of money thrown into development and advertising. HP has a ton of money. They've recently boosted their research budget to $2.96 billion. Last year, HP had an operating income of over $11 billion.

Ten months and a few million dollars of HP money was enough to get us the TouchPad. Imagine what they can accomplish with another year and a few billion.

4. Developers. There are roughly 6,000 webOS apps right now. That isn't bad compared to, say, Windows Phone 7, but it doesn't come close to Android or iOS. WebOS barely breaks one percent market share right now. There's no reason for for devs to spend their time and money building for a platform with no legs.

But 17 million+ new webOS devices per quarter (and that doesn't count Pre or TouchPad sales) will be hard to ignore. March 14 is the expected launch day for HP's next wave of webOS devices. A few months of solid sales, followed by an explosion of webOS PCs, will greatly change the current app ecosystem.

5. HP Can Subsidize the TouchPad.

As I noted earlier, HP has bucketloads of liquid cash. And they seem to have their eyes on the long term here. Building a base of loyal users is job 1. And there's no better way to spur adoption of a new platform than by making it affordable. We won't see HP make the same mistake Motorola did with the Xoom. Expect the TouchPad to start at $499, even if HP has to take a loss on every unit sold.

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