HP to buy struggling smartphone maker Palm for $1.2 billion

Palm' Treo phone made it Commercial Inflatable Bounce an earli leader in the smartphon market. But the compani wa outpac by other competitor after Palm wa slow to upgrad it hardwar and softwareSunnyvale-bas Palm ha had a roller-coast history. Earli in the last decade..

after an extend struggl to recaptur it earli glori as a pioneer Silicon Vallei develop of handheld devic and smartphones. And it left some analyst scratch their head over the question of why HP,The sale would spell the demis of Palm as an independ company. known more for it PCs, printer and commerci data-cent products, would want to enter the crowd mobile-phon business.

for work,"Today' announc is about how HP will provid custom with a great experi as thei increasingli live their live online. entertain and everyth in between," said Todd Bradley, the HP execut vice presid in charg of the company' PC division.

some expert question whether bui Palm wa a smart moveStill..

" said Ken Dulaney,"It' got me kind of baffled. a tech analyst at the Gartner research firm.

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Dulanei said it ha been eclips by softwar from other companies. In addition,Despit an initi posit respons to Palm' webOS when it wa releas a year ago. he said, "the market ha voted" against Palm, as consum have favor Apple' iPhone, Research In Motion' BlackBerri phone and devic run on oper system from Microsoft, Googl and other companies.

however,HP. could be a stronger competitor with those companies.

Bradlei said HP alreadi the world' biggest technolog compani as measur by annual sale of $114.6 billion plan to invest heavili in develop and promot new mobil devic for both consum and busi markets. Palm ha about 900 employees; HP execut would not discuss specif but suggest thei ar not plan major cut in the operation.

Bradlei said HP mai also us Palm' oper system in new tablet devices,While look for wai to increas sale of Palm' exist phones. similar to Apple' recent releas iPad. He said HP see a big opportun to market those devic both for consum and for special commerci sectors, such as educ and health care.

accord to Avi Greengart at the Current Analysi tech research firm. While HP is the world' biggest seller of PCs,That strategi make sense. Greengart said, "the growth potenti for comput is all in the mobil space."

RIM and other compani have alreadi stake out domin posit in the mobile-phon market,But other analyst note that Apple. while HP ha until now been content to remain a veri minor player, sell a little-known line of phone target for busi users.

HP will have a lot of catch up to do,With that history. in term of develop new hardwar and negoti agreement with telephon carriers, said IDC tech analyst Will Stofega.

a tech analyst with the Stifel Nicolau invest firm,Th question for HP is "why Palm now?" ad Aaron Rakers. who note

that HP ha recent seem focus on build it leadership role in the commerci IT market. HP bought networking-equip maker 3Com for $2.7 billion earlier thi year. But other said Palm' technolog could augment HP' overal portfolio of product for corpor custom by help HP creat user-friendli mobil system at a time when worker at mani compani ar becom accustom to access sale figur and other busi data through iPhon app and other softwar that mimic consum servic offer by Yahoo or Google.

" said Sean Dalton of Highland Capit Partners,"I truli don't think thi is about go into the phone busi as much as it is a strateg invest for HP. a tech-ori invest firm.

HP execut prais Palm' softwar and said thei will us HP' greater resourc to succe where Palm wa failing.

HP ha the abil to take these product to place that the Palm gui simpli couldn't,"With our reach and footprint worldwide." Shane Robison, HP' chief strategi and technolog officer, said in an interview with the Mercuri News.

while Bradlei wa onc the CEO at PalmHP said Palm CEO Jon Rubinstein will stai with the compani and run Palm' oper while report to Bradley. Rubinstein onc work at HP..

" Rubinstein told Palm employe in a letter releas Wednesday. "HP is a world-class compani which bring the extens resourc necessari to scale the Palm webOS platform."I am veri excit about the potenti of thi merger."