By Russell Williams
On the 15th August Google snapped up Motorola Mobility, and days later Hewlett-Packard (HP) announced its plans to sell off its tablet and mobile unit. So what’s going and who’s right?
Google was founded in 1996 as a software company, its origins were in developing efficient algorithms – a sequence of mathematical or computational instructions – for searching for keywords or patterns with data. They then went on to create a number of other services GMail, Google Docs, Google Maps etc. They also went onto develop Android the operating system which is running millions of Mobile Phones, Tablets and other mobile or embedded devices. The key point to note is that until now, they have not actually made hardware, devices on which their software run.
HP on the other hand has been a hardware company since Bill Hewlett and David Packard were tinkering around in their garage in 1939. HP has made tangible products ranging from calculators to hospital equipment and printers of course.
But what’s the deal with Google and HP? Well everyone knows that computers are pretty much everywhere, and they have revolutionised the way we do business, communicate and so on. Well there’s a little appreciated fact that little or none of this would be possible if it wasn’t for software! That’s right, a computer without software programs is nothing more than an expensive paper weight or ornament.
HP and to some extent Dell are now catching up with the realisation that IBM, the makers of the original PC made back in 2004, when they sold the PC business to Lenovo. The fact is there’s not much more money to be made in the PC business; and with the power of the mobile phone and tablet devices’ increasing this too is putting pressure on PC sales.
So as the PC has become more of an everyday consumer item – some countries even include the cost of computers in the basket of goods which form their retail price index or inflation figures – the profits to be made from selling them has decreased. Yet at the same time software companies and companies that focus of delivering Software as a Service (SaaS), and web based services have increased their margins and their profits.
Several months ago HP President & CEO Léo Apotheker announced that HP would be focusing efforts on developing cloud based services. This has split those in the IT world; some think HP should stick to its core business of developing outstanding hardware and servers. Others think the move has been too long in coming. Why?
The best explanation I heard was made with an analogy, likening HP to the general stores in the Gold Rush era. These store owners would sell spades, pick-axes and pans to prospectors and made some good money doing so. However, some of the prospectors went on to strike gold! HP is making good money selling servers to companies like Amazon, ebay, FaceBook and Google who until now didn’t make anything tangible, but make good or better money!
Which brings me to my point, or the second portion of the article title, what can we in the Caribbean Learn? Perhaps more than you might think; any entrepreneur in the region knows you can’t go to a bank with the best idea since fire, the wheel or the Internet. Since most banks here are not progressive enough to look at Intellectual Property as security, one can become unstuck rather quickly.
This brings into focus the crux of the matter for both Google and HP! Many pundits have said that Google is simply trying to gain patents – ownership of ideas, intellectual property – to protect them against future legal claims of ripping off someone else’s idea. HP is said to be acquiring a software company to help them expedite their efforts to become a software company, which again is simply the codifying of ideas into a computer language.
So how is this relevant to us? Well, in the regions we have a complete and utter disrespect for Intellectual Property and the creation of ideas. Don’t believe me? Just ask any of the calypsonians whose music is being sold from the boots of cars and without them getting a cent! Ask the consultants whose work appears in reports that haven’t been paid for or proposals being implemented by someone other than the companies or individuals who wrote them.
More over, we dismiss the very prospect that someone should have a valuable idea based on who they are, who their parents are and whether they were raised in the town or country! Everything man-made tool began as an idea, from the clothes on our backs, to the meals we eat. So why are we so ready to dismiss, discredit or steal the creative ideas of our own people? We should be encouraging every one of us to generate as many ideas as possible because we don’t know which of them would be the next light bulb, Google, Telephone or iPad!