HP’s WebOS: Giving It Away

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Back in 2010, HP (NYSE:HPQ) shelled out $1.2 billion for Palm to get a piece of the hot smartphone market.  A key asset of the deal was the WebOS. HP believed it would be the foundation for a thriving business.

Unfortunately, it was a flop. HP soon learned that it is incredibly tough to develop devices that consumers like.

So what to do? HP is now making the WebOS open source — that is, it will be free for anyone to download and develop on. Actually, this has been Google’s (NASDAQ:GOOG) strategy for Android, and it has worked quite well. Yet  the search giant has an advantage: It can monetize its mobile footprint with search advertising.

But HP still has a lot of work to do.  For example, the company wants WebOS to be on Linux, which will allow the system to be deployable on many devices.  So, the first open-source version won’t be available until September.

In the meantime Apple (NASDAQ:AAPL) and Google will continue to grab market share. And even if the WebOS eventually gets traction — which is far from certain — it’s not clear how HP will make any meaningful money from it.