Are you looking to bring multi-touch to standard notebooks? Ted Clark: Absolutely, we really like TouchSmart, the software that’s there. as you said, we have great a couple tablet products, which tend to meet the commercial side, more vertical needs. We’re working very hard to get multi-touch on notebooks. But there’s a technology barrier. It’s interesting, we’re working on it. There’s no time-table. But overall [multi-]touch is maybe more applicable in a mobile setting than a desktop setting. What is the technology barrier for putting multi-touch on a notebook? Ted Clark: The technology the deskop is using is optical. And it’s too big and thick. It’s built into the bezel. Unless we wanted to make a notebook thick– I mean, laws of physics type stuff. But we’re working on some stuff and when we get it going, you’ll see us get it out there. At Computex, one of your competitors unveiled a prototype notebook with an integrated projector. Is HP looking at different types of mobile projectors? Ted Clark: We spent time on this. They’ve got some technology pretty far along but were never happy– at least so far, we’re still looking at it– we’ve not been happy with the quality and cost and size. It’s a cool idea. But it takes a lot of power and a lot of optics. [We’re] is looking at it, but I don’t think it’s real anytime in the near future. Do you see the market for mobile thin clients growing? Ted Clark: We at PSG [Personal Sytems Group] and HP in general have spent a lot of time on virtualization as a category and we’re very optimistic. We’re probably a little bit early. We know those are generally a longer sales cycle, has to be specific, specific requirements. mobillity makes it a little bit tougher, so you can’t always be connected. And now with mobile broadband it’s got lots of possibilities. Over time, it could have a significant impact in changing the landscape of notebook computing. Because there’s huge benefits. Get the hard drive out of there, which is wonderful. From every angle, getting the hard drive out of there is wonderful. And you don’t need high performance processors or high performance graphics. You need a keyboard and a screen. And you get that working and you connect everywhere and it could really be a game changer. We’re all about being on the front end of that. Do you see a shift in innovation and R&D more toward software? Ted Clark: I don’t know. I think for the mobile area there’s plenty of opportunity for all of it. Integrated projectors would be cool. Battery life– some of that can be controlled with software– but solving the battery life problem is– I’ve been in this business a long time– continues to top the list for almost every business customer. You ask, “What’s the one thing you’d like to improve in your notebook?” Longer battery life is up there. So there’s huge opportunity on the hardware and software side. We will spend more money on software-type things, but we aren’t going to remove our investment in hardware either. Why hasn’t HP been promoting SSDs as aggressively as some of its competitors? Ted Clark: We actually offer SSD across our entire “p” series of products. I like it. But the value equation is just way off. It’s like a thousand buck for 64GB. The problem with it too is that the supply is directly tied to RAM. And so in times of falling memory crises it’s a way for them to hedge and put some capacity on SSD and it comes down. But with a rising memory cost, SSD rises as well. And generally speaking hard drives since the beginning of time have followed sort of a Moore’s law: the prices are always coming down, but the capapcity is going up. You can’t say that about SSDs. If we had customer interest, we’d put it in everything. It wouldn’t take us very long. Where is HP headed in the ultramobile space? Ted Clark: We take ultramobile all the way through 12-inch all the way down to the Mini[Note]. Specifically in the mini category, we’re pretty excited about it for targeted groups. The Mini has come out at least in the U.S. targeted at education, in Asia targeted at youth, in Europe targeted more toward educaton. In those specific applications I think it’s going to be a very important part of the overall category. I’m a little skeptical about some of the numbers I read from my competitor, about how many they’re going to sell. I mean, they’re going to build and maybe shove through a channel at discounted prices, but I’m not sure that the volume is there in those numbers. I don’t think these are going to cannibalize much of the market. I think they’re second PCs, third PCs. It’s not what you’re going to go buy if you’re going off to school or college as a junior high through graduate school. But our product is targeted at elementary school type kids. We’ve got some pretty good winds already in the schools. I think it will be a part of the market that’s viable, but kind of how tablets are. a kind of steady state, five, ten percent. but nothing that’s going to cannibalze a big segment. How do you see business notebooks changing as the Net generation enters the workforce? Ted Clark: That’s a great question that we do spend a lot of time on. You see part of that today with the EliteBook. We are starting to see that effect already, that the younger part of the workforce comes in and says, “This is boring. Give me something that’s got a little more style to it. Give me something that at least is more personal, makes me look better.” And I think those younger end users in large corporations even are going to have a much greater influence over IT. Also, we’re putting information on notebooks. For years, the policies were lock down, you will never do it. Our policies are changing, we’re trying to figure out how to lock down the corporate side and leave the personal stuff for the end user. Size and weight will become even more important for corporate customers. I think it’s also a more disposable thinking culture. People growing up with the technology. It’s part of their life. It’s not a novelty. It could be good for the notebook business. So as business notebooks become better looking and more consumer notebooks have durbaility features such as 3D accelerometers, what features will remain unique to business notebooks? Ted Clark: Good question. That’s another one we spend more time on. I think there’s always crossover. We put Blu-ray in our commercial notebooks first because they wanted the big capacity write capability and the cost wasn’t an issue. So it’s going to be driven by the technlogy and how affordable it is and the benefit. and some things will go in both and some things will go in one and migrate. but over time I would say almost everything will cross over. the exception of that might be some of the entertainment stuff. we’re probably not going to put a lot of TV tuners in commercial notebooks. other than entertainment, I think it’s going to have the effect of going both ways.