Business & Pleasure: What’s Next for HP’s Notebooks

Guten tag. I’m in Berlin, attending HP’s Connecting Your World event, where the company announced scads of new products yesterday. Since the annoucements were made (amid trombones and even a brief Kanye West interlude), I’ve gotten hands-on time with all the new gear, and sat down with various executives at the company. First, I sat down for a small press conference with Kevin Frost, general manager of the consumer notebook division. Then, I headed over to a discussion with Ted Clark, SVP and general manager of notebook global business. From carbon fiber notebooks to the convergence between business and consumer machines, they hinted at future products and strategies. We say that when the number one global notebook vendor starts a trend, it’s big news for everyone.

Consumer Notebooks

For the past year and half, other companies have aped HP’s DV design. Do you feel the line’s new look will help re-establish HP as being on the forefront of design? Kevin Frost: So you go into a retail store. You touch a notebook, you look at it. When you get the product home you’re going to be proud of it. You have an emotional attachment to it. Those things are hard to copy. I think design is sometimes oversimplified. People think oh if I do two or three colors, if I change the color, offer you three colors, that’s great design. The integration of the software, the hardware, making it reliable. Making sure the key caps don’t run out– it’s harder than you think. We’ve been focused on industrial design for many years. And when you see something like the breakthrough we had with hp imprint two years ago, there’s a lot of years that led up to that. It’s in our DNA, and I think it’s very hard for people to copy. So am I encouraged that it’s going to push us forward? Absolutely. But it’s not one of the things that keeps me up at night. I know what we have in the pipes for next year, and we’re doing some great new stuff. Even looking at the Voodoo annoucment, the carbon fiber. Looking at new materials. There’s a lot of exciting stuff in the pipeline. Aside from design, how do you see the new pavilion line ushering in more changes that will distinguish it from the other major players? Kevin Frost: There’s a lot of little ways to be successful. Design is a great place to start because that’s what people touch. And they experience. But we think the most important thing is just the whole user experience. Bringing Vista into people’s homes, giving people a good experience, has been harder than we thought, quite frankly. Everything from learning a new OS to is this going to be reliable. All that kind of stuff. We have a lot of focus just on the experience. The basics of experience. How fast does my computer boot up? I want to put it to sleep. Battery life. Keyboard. And I think design’s part of it. I think we have a competitive advantage on design, we have a competitive advantage on user experience. We have a competitive advantage on support. We have both the new AMD and the new Intel processor. We have the latest Blu-ray technology. There’s a lot that goes in there. With Intel and AMD each releasing new platforms, there’s a lot of talk as to whether CPU or GPU is more crucial to a notebook’s performance. What’s your take? Kevin Frost:I think people don’t pay enough attention to the graphics. I’m not going to say I have a side, I’m not going to say which is better– processor performance or graphics performance– but as an industry, HP is a leader and we can do a better job communicating with customers and saying “Hey, graphics performance is important. And we want you to have a robust solution.” The other interesting thing about it is, in Europe with the Pavilion line, almost all of them have discrete graphics. And we don’t see that in america. So we see significant divergence in geographic trends in graphics performance. It’s very interesting. Asia’s in the middle. Europe wants high-end discrete graphics, America’s happy with GMA, Asia’s in the middle. They just want reasonable discrete graphics. Do you see that changing in the U.S. market? Kevin Frost: I hope so. I’m not sure if it’s the Wal-mart effect in america or what it is that drives that. Maybe we communicate [using] a brand. Like Nvidia. Or ATI. The other approach has been to focus on these graphics brands and really say, “Hey, we have the latest Nvidia technology.” But there’s pros and cons to that as well. Look at what people pay for. Look at all the things you can pay for in a notebook. RAM, display, I would say GPU. I would say they could maximize the money they could spend in those areas. Has latest Intel platform been worth the wait? And how does it measure up against AMD’s Puma platform? Kevin Frost: As you know we’re annoucning support for the latest processors. And frankly our strategy has always been to give customers a choice. And I think depending on your budget, form factor, both of those processors play a role. I would say amd is a big percent of our lineup. And will continue to be that we’re very supportive. Let’s talk about the MiniNote. How do you keep innovating as the price continues to drop? We see no cannibalization at all. A mini-notebook’s going to be a companion to a notebook computer. Nobody’s going to try to work on a fifty-page document. [No] Hard-core gaming on a mini-notebook. I view it as a great complement to a notebook. For example, if I’m going to go on a trip and I know all I need to do is do two things: one, get on the Internet, two check e-mail, three travel on airplanes where I’ve gotta lug heavy luggage. A mini-notebook may be the perfect product. Is it a race to the bottom? The technology industry and the notebook industry– the EP declines. It’s been very steady. Part of the balance for us is having a rich portfolio of products and higher-end technologies, like the Voodoo [Envy], all the way to the MiniNote product. We’re excited about the concept. Frankly, the category has more appeal; I’m more excited about it than I was perhaps six months ago. I think they’ll be lots of room for innovation in the cateogry and I think it runs along the lines of software and I think the next time I talk to you I’ll have some more specifics. Let me tell you, we will have more opportunity to innovate in the MiniNote than we’ve had in other categories in a long time. Would you ever bring the TouchSmart technology to the TX tablet series? Kevin Frost: You’re a very perceptive person. The short answer is the technology– the hardware technology, the display– is different. But we will ship a touch-based UI notebook in the future. Will we see a multi-touch notebook before Windows 7 launches? Kevin Frost: We’ll do it before then. Long before then. The goal with the TouchSmart on the notebook is to leverage the same exact software you saw upstairs and be able to get it into the right form factor with the right touch technology associated with the notebook. Technology evolves quicker than ever. How do you make customers comfortable with these new features? Kevin Frost: It’s a challenge. And I think HP will have to play a bigger role in the software and the software integration than we’ve had in the past. Because– it’s interesting- consumers are trying to do more, trying to integrate more stuff, bring in more video, more photos. With touch technology. So HP’s going to have to play much more of a broader role in the software than it has in the past. So that’s one of our biggest things. Can you talk more about the increasing importance of software to the develoment of notebooks? Kevin Frost: I think one of the shifts we’re in the middle of at HP– and it’s a journey, but it’s a little bit of an evolution– we have changed more from MHz processor and all this hard-core hardware specs. And the things people were doing on their computers two or three years ago, perhaps that worked. But now as applications and needs are changing, we have changed our focus to the experience and what we do with software and how to integrate them. The Touchsmart is a great example. And it’s probably the single biggest issue we face right now is how to give customers a better experience. We have a lot of room to improve and I’m highly confident we can do it better than anybody else. Has the TX2000, your first consumer tablet, met your expectations? Kevin Frost: It’s exceeded my expectations. It’s very inteesting. It’s probably better than we would have thought. The EP’s very high. One of the big challenges we always have is, what’s the right form factor? When we talk about touch. Is it this or is it a slate? And then we always kind of go back and forth. I think we’ll introduce other generations of this. We have others planned for this year, and others planned for ’09. We’re starting to see the line blur between consumer and business devices. The iPhone, for example, is becoming more enterprise-friendly. Do you think the two categories are converging? Kevin Frost: I do. In the past enterprise notebooks were considered pretty stodgy and pretty– I hate to say square– but on the design we were very ultra conservative. And we’ve actually tried to push the design. Give enterprise customers more attactive looking notebooks. We call ourself consumer notebooks but really it’s retail notebooks. And very large percentage of people who buy notebooks like this at retail are small or medium businesses. We absolutely see a convergence. It’s convergence in your lifestyle, technically. When I travel on work I wanna have my music, my photos, movies. What about consumer technologies making it into business notebooks? Kevin Frost: You talk about the enterprise technology coming in to the mainstream notebooks as well. Same thing with voodoo. That’s a brand new technology in terms of how you manufacture it and we will pioneer the [technology] covered by Voodoo products and I think as soon as we’re comfortable we can meet the needs and volume of the mainstream notebooks we’ll bring it down there. We ship a notebook every second. And so there is an element of volume manufacturing that you have to have. And some of the latest technologies, we just can’t make ‘em. So which segment are you going after with the Voodoo Envy? Kevin Frost: It’s tech enthusiasts. People who can really appreciate the most advanced technology in a notebook and especially the design and the style. It’s not a fashion statement. It’s almost a luxury. Let’s take the technology and push it up a level. I don’t wanna say notebooks are a reflection of your personality, but it kind of is, in some way. That’s why there’s much more of an emotional attachment to a notebook than there is to a desktop. When are we going to see a carbon fiber Pavilion? Kevin Frost: We don’t comment on unannounced products but I think I can say we’re looking at it very closely.

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