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Old 07-29-2005, 07:55 PM   #1
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HP kisses Apple iPod goodbye

After a relationship between Steve Jobs and former HP-CEO Carly Fiorina that lasted just a little over a year and a half, HP has decided to stop reselling Apple branded iPods. According to an Apple spokeswoman, it "doesn't fit with their [HP] company's current digital media strategy. HP declined to say what their strategy is, but confirmed that the company will remain comitted to digital entertainment, which includes selling televisions and multimedia digital entertainment centers. According to HP's original agreement with Apple, it cannot sell another player that competes with the iPod until August 2006.

HP on average accounted for about 5% of iPod sales, which totaled about 6.2 million of the devices, worth more than $1.1 billion in revenue, for Apple last quarter. Consequently, shares of Apple fell $1.15, or 2.6 percent, to close at $42.65 in Friday trading. HP shares gained 13 cents, $24.62.

[via WSJ]
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Old 07-30-2005, 01:52 AM   #2
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Not great.... for HP. It's the right decision, but since HP can't market nor sell it's competing player until Aug. 2006, I think the agreement was terminated too early.

5% of 6.2 million player (ipods sold last quarter) is 310,000 unit. At say, $200 a pop, that still 62 Million of revenue. More than probably most other competing players has...
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Old 07-30-2005, 08:24 AM   #3
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Really too bad for those of us (cough) who have HP iPods. They actually gave you 24 hr service if something went wrong. I somehow doubt they'll keep that going. I wonder about the warranty too, although I think I'm out of it now.
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Old 07-30-2005, 08:36 AM   #4
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Quote:
Originally Posted by gadgetguru
Not great.... for HP. It's the right decision, but since HP can't market nor sell it's competing player until Aug. 2006, I think the agreement was terminated too early.

5% of 6.2 million player (ipods sold last quarter) is 310,000 unit. At say, $200 a pop, that still 62 Million of revenue. More than probably most other competing players has...
I think it makes sense for HP. They are a technology company not a distributor, so why should they resell someone else's product? They weren't making much money for reselling iPods either, or they wouldn't have stopped the deal.
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Old 07-30-2005, 08:36 AM   #5
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Originally Posted by sUnShInE
Really too bad for those of us (cough) who have HP iPods. They actually gave you 24 hr service if something went wrong. I somehow doubt they'll keep that going. I wonder about the warranty too, although I think I'm out of it now.
According to various sources, HP said it will continue to honor all warranties and service contracts. The HP devices will remain on sale until supplies run out sometime in September.
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