Hewlett-Packard came to symbolize Silicon Valley, even before the phrase existed. The company was founded by Stanford graduates in a Palo Alto garage, establishing an informal culture that was built for innovation. For more than 75 years, Hewlett-Packard helped define the technology of the times, from audio oscillators to calculators to tablets to, more recently, disruptive trends like the cloud and big data.
And now CEO Meg Whitman is bringing the company back to its roots.
On November 1, HP separated into two independent companies: Hewlett Packard Enterprise and HP Inc. HP Inc. continues to sell the company's well-known PCs and printers. Hewlett Packard Enterprise is focused on the technology for businesses that most consumers don't know much about — but which powers some of their favorite products and services.
Nearly everything we do today — from checking Google Maps to asking Siri a question, from posting on Facebook to shopping at Zappos — creates an enormous volume of data that requires massive computing power and needs to be stored and processed. Hewlett Packard Enterprise builds and maintains the IT infrastructure that makes smartphones smart and turns big data into useful information. Hewlett Packard Enterprise, led by Whitman, is focused on innovation, focused on agility, focused on responding quickly to its customers. And it has at least one project close to fruition that will revolutionize computing.
Why did Hewlett-Packard split?
Selling printers to consumers is a very different business from selling servers and cybersecurity tools to large companies.
"We needed to be smaller, more nimble, we needed to be more focused," Whitman told The Wall Street Journal. "What I realized was, this market is changing at lightning speed."
Splitting up Hewlett-Packard means Hewlett Packard Enterprise and HP Inc. are now both better positioned to compete in their very different markets.
What does Hewlett Packard Enterprise look like?
With 250,000 employees in 120 countries, annual revenue of about $57 billion and an operating margin of close to 10 percent, Hewlett Packard Enterprise hardly looks like a brand new company. It's just a few days old, but it's already in the Fortune 100. (So is HP Inc.)
Hewlett Packard Enterprise will continue to provide the technology for businesses, and has grown its market share significantly in recent years. People identify Hewlett-Packard with its PCs and printers, but HP is already the No. 1 or No. 2 provider of servers, storage, software, and wired and wireless networking — as well as one of the only companies that sells hardware, software, and the services so customers can use technology more efficiently and effectively.
Why is Hewlett Packard Enterprise important?
People count on their Uber to show up, their Venmo payment to go through, and the weather forecast to be there when they want to see it. What we don't think about is the behind-the-scenes technology that keeps all those conveniences humming along smoothly. But it all happens because of the secure and cloud-based infrastructure that Hewlett Packard Enterprise creates. And it's more important than ever.
We're living in what the company calls the Idea Economy. Turning a great idea into a disruptive business requires far less time and funding than it used to. What it does require is a flexible and efficient IT infrastructure that can identify valuable insights in data and operate reliably and securely across a range of devices. To help businesses compete in a changing market, Hewlett Packard Enterprise is focused on helping its customers transition from traditional IT to cloud-based systems, turning data into actionable information, providing digital security tools, and boosting workplace productivity.
And what's the next big thing from Hewlett Packard Enterprise?
With so many transactions, so much data, so much information to learn from, organizations require IT systems that are more and more powerful — and more and more energy efficient. By 2020, experts predict that as many as 30 billion devices will be online, generating an unprecedented amount of data to store and analyze. Already, 10 percent of the world's power is used to cool down servers.
Hewlett Packard Enterprise is addressing this problem with "The Machine," an ambitious project to do nothing less than reinvent the way we compute. For 60 years, computers have been built with the same architecture: a central processor, memory, and storage. But although processors keep getting more powerful, data can only move in and out of memory so fast. The idea behind The Machine is to combine memory and storage by keeping all information on new "memristor" chips — which would radically cut the time and energy needed to process large data sets.
The Machine "has the potential to change computing as we know it," Whitman said at a Hewlett-Packard event last year in Barcelona. "It is that big."
The first version of The Machine will be introduced next year, without memristor chips but with 320 terabytes of memory. It's the kind of product that's only possible with the resources of a large company — and with the agility of a focused Hewlett Packard Enterprise.