Hewlett-Packard to boost investments on mainland

PUBLISHED : Thursday, 24 February, 2011, 12:00am
UPDATED : Thursday, 24 February, 2011, 12:00am

Hewlett-Packard, the world's largest information-technology company, plans to step up investments and marketing on the mainland this year as part of its effort to restore consumer confidence in its brand there.

HP, which is also the biggest global supplier of personal computers, was hurt by negative publicity about consumer complaints early last year regarding faulty laptops and the government's subsequent investigation of the matter.

'We are launching a major advertising campaign very soon because we really want the Chinese market to understand that HP is a good, trustworthy and innovative brand,' HP president and chief executive Leo Apotheker said yesterday.

Apotheker, who joined HP in October, said the company 'is looking to make additional commitments in cloud computing' initiatives on the mainland, although he did not disclose the amount of the investment.

He planned to visit the mainland at the end of June with the hope that 'Chinese consumers re-engage with HP' more intensely than before. HP, which has operations in 170 countries, also has businesses in software, services, printers, enterprise computers and networking equipment.

The company hoped to generate interest on the mainland this week by unveiling its new line of smartphones, the Veer and Pre 3, and its media tablet, the TouchPad. No commercial release dates were given for these devices, which are all based on HP's Palm webOS operating system.

In its financial results for the first quarter to January, announced yesterday, HP reported a 16 per cent increase in global net earnings to US$2.6 billion from US$2.3 billion a year earlier, mostly on strong commercial-sector spending.

Net revenue was up 4 per cent to US$32.3 billion from US$31.2 billion.

Apotheker said HP's total commercial personal computer revenue during that quarter rose 11 per cent 'to help show good growth in each region'.

Market research firm International Data Corp, however, said HP's sales of mini-notebooks, commonly known as netbooks, and regular laptops to consumer markets slowed in the quarter to December.

IDC estimated that HP, which retained its No 1 ranking worldwide, saw its global market share slip to 19.5 per cent in the quarter to December from 20.2 per cent a year ago.

Apotheker said HP's 'recovery plan' on the mainland helped its domestic personal computer business revenue grow 25 per cent in the past three months over its previous fiscal quarter.

'We're showing good progress, but we still have work to do in the future,' he said.