In April 2010 HP acquired Palm for $2.1 billion. Since then HP announced three products powered by Palm’s secret sauce known as webOS: the next-gen Pre3, the tiny Veer, and the TouchPad tablet. Due to a number of factors (including but not limited to manufacturing delays, almost no buzz, and as a result of that poor sales figures), HP has decided to discontinue all webOS devices. A press release outed Thursday states:

HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones. HP will continue to explore options to optimize the value of webOS software going forward.

So what does this mean for ex-WebOS engineer Job Rubinstein’s creation? Well, HP refuses to say that the innovative OS is dead. The majority of industry insiders believe that HP might go on to license the OS to other hardware manufacturers. So in a nutshell, HP will continue shaping the OS for the future but the devices it will run on will be made by other manufacturers. (It’s like what Google and Microsoft do with their cell phone businesses; Android and Windows Phone 7 are developed internally and they are pushed out to consumers on devices made by other manufactures like HTC and Samsung.) For now, however, the manufacture of the Pre line, the Veer, and the TouchPad will be ceased and when the current supply of inventory is gone, that’s the end of it. If you’re in the market for a decent tablet, though, now’s the time to splurge: HP is having a major TouchPad fire sale to get rid of all the remaining inventory. The 16GB ($399) and 32GB ($499) models are seeing a significant price drop today; they are now going for $99 and $149 respectively. Check out Slick Deals to see the retail outlets that have the price reduction in effect.

In the same press release HP also announced that “its board of directors has authorized the exploration of strategic alternatives for its Personal Systems Group (PSG).” In other words, the company is pondering a way to spinoff their consumer-oriented hardware wing so that they can focus all their attention on building software. You see, the company’s PSG includes HP desktops, laptops, printers, webOS devices, etc. HP is in talks with Autonomy Corporation plc about handing over their hardware unit, but according to HP CEO Leo Apotheker it’ll be another 12 to 18 months before any major decisions are made regarding the new focus for the company.

It’s clear that this is a time of transition for HP. They spent billions on a fading hardware company and that went bust. Now they are taking a step back from the consumer industry and considering a big move towards software and services. When all the dust settles, though, there’s one thing that remains to be said and makes a lump form in my throat: with Rubinstein working on other projects and webOS on death row, this time Palm really is dead.

[Via Engadget] Continue reading HP discontinues webOS devices →