Observations: Tabbloid and HP’s (NYSE HPQ) Ongoing Innovation
A recent article by Ashlee Vance in the Sunday New York Times profiled HP CEO Mark Hurd. He was generally complimentary on Hurd’s success steering HP’s mega-oceanliner into profitable seas via a sharp financial pencil that has led to drastic cost-cutting and a string of successful acquisitions. Hurd’s non-personality-driven, no-nonsense turnaround has been all the more stunning in the wake of the tumultuous tenure of previous HP CEO Carly Fiorina.
But the title of the piece, “Does HP Need a Dose of Anarchy?” suggests that there is a knock, or potential knock, on the new boss: will Hurd’s HP Labs R&D cuts, which have chopped the number of active projects from 150 to 30, stifle the launch of innovative products in future years? A well-known HP alumnus, Charles House, who worked at HP for 29 years overseeing the creation of 12 product lines, told Vance, “I think they are seriously underspending on research and development. It seems to me that betting on new areas is a struggle for them.”
The article asks if HP has missed the boat in a couple of exploding technology categories recently, allowing rivals to beat it to the punch with new gadgets in fields like smartphones (Apple and the iPhone) and e-book readers (Amazon and the Kindle). Vance notes, “HP is trying to expand its presence in businesses like personal computers and printers, [but] some critics argue that those markets have little left to give.”
Has innovation at HP’s Imaging and Printing Group (IPG) been stifled? One counter example is the effort of Antonio Rodriguez and his team. Rodriguez is the former CEO of Tabblo, a firm acquired by HP in 2007 (see "HP acquires Tabblo") and is now the chief technology officer of IPG’s Inkjet and Web Solutions division.
Rodriguez last appeared in this column in September 2007 (see "HP's $300 million ad Campaign and the Four Ps of Marketing"), in a discussion of HP’s Web printing strategy. Since then, he and his team have been busy on a variety of fronts, including working on driving printing from Web-based content.
The Tabbloid project is one recent area of innovation. The name cleverly combines Rodriguez’s former company’s name (Tabblo) with the name of a traditional newspaper format (“tabloid”). The Tabbloid technology allows users to receive a custom formatted PDF file comprised of the latest items from their favorite blogs, including text and images. The file can be viewed in an Acrobat viewer or printed in beautiful living color on your (hopefully HP-branded) output device.
End-users sign up for the service and identify the blogs they want to read at www.tabbloid.com. To get them started, HP provides links to a few leading blogs in several categories. The service packages each blog and its latest and greatest RSS feeds, complete with images (see photo above).
Rodriguez is typically exuberant about Tabbloid’s impact on HP’s printing business. “Tabbloid has resulted in millions of incremental pages printed, the result of hundreds of thousands of issues, with tens of thousands of people signing up for the service” since its fall 2008 launch, he proclaims.
When asked why Tabbloid provides a superior user experience compared to simply improving the printing capabilities of individual blogs, another area HP has invested in, Rodriguez explains, “Tabbloid has been two orders of magnitude more successful than Blog Print for three reasons. First, [HP R&D investment in] cleaning up the RSS feed content, including taking junk out and crawling for completeness and ‘normalizing’ the content [leading to fewer or no ‘dead ends’]; second, the capability to mix and match content, focusing on users’ interest in variety, not single blog-dedicated content; and third, automatic e-mail delivery of content.”
Tabbloid, despite its slick Web site and appealing PDF output, has been a “skunk works” operation and not a full-fledged HP program until recent weeks. Despite his enthusiasm, Rodriguez recognizes that there is more work to be done. One area that excites him is an application of the Tabbloid technology that focuses on the needs of publishers rather than readers (stay tuned to future editions of this column for more).
One editorial comment about HP’s innovation direction should be noted. Typical efforts over the last number of years centered around printing from the Web and other new content sources have too often come down to the company’s rather narrow business goals of increasing (or sustaining) the usage of HP-supplied ink, toner, and paper. However, HP’s investment in innovation will best be realized by expanding that view and carefully exploring real customer needs and how they can best be met, whether with printing or even non-printing solutions.
In terms of understanding customer needs and business models, take another look at last month’s Observations column (see "Ultimate Countertrend - The Printed Blog") and its brief exploration of The Printed Blog (TPB), which, with its printed blog newspaper, is a similar solution to Tabbloid, at least in its output. A big difference is that the small company behind TPB sees the publishing ecosystem at large (e.g. existing newspapers, advertisers, printers, distributors, and readers) and is integrating existing needs and capabilities. HP can take a lesson from this view, in moving away from a “how to spill more ink” approach.
But back to the original question in this column: Is HP, under its new CEO Mark Hurd, stifling innovation and thus the firm’s future? At least regarding that idea on the printing and imaging side of HP, it is refreshing that there is still room for a skunk works project or two.