I’ve been pondering the meaning of the recent rash of cancellations of upcoming padlike devices, trying to put them in context with one another.  The easy conclusion to try to reach for is that they’re all somehow running scared from the iPad, but even the most loyal adherant of the Church of Apple would recognize the fallacy of that argument.  When something is at the height of a hype cycle, you try to capitalize on the hype, not run the other direction. When the iPod was first announced, it created a full cottage industry for knock-off iPods and a well formed ecosystem around the manufacture of MP3 and portable media players. When the iPhone was announced, it helped kick off the world of smartphones in a way that Nokia had been attempting since my days at the company, nearly a decade ago.

Will the iPad, then, create some sort of ecosystem for pad-like devices? I believe we can see evidence of this already. Aside from the newly cancelled Microsoft Courier and HP Slate, there is a myriad of devices that, in some form or fashion, mimic the usability of the iPad.  Days after the launch of the iPad, Chinese hardware hackers had an exact duplicate created and ready to go to market running on Android, with the expected price point under $150.

Microsoft Isn’t Betting Against the Developer Community. Apple Is.

With bigger players like Microsoft and HP trying to create a more open and capable device than the iPad, there are two issues they have to compete with – the developer community momentum of Apple (and soon, Android), and the price-point.

A friend of mine at Microsoft, one who was internally a fan of the Courier, but not working directly on it, said "lots of people are upset about this. I don’t know why this was canceled.”

But then he went on to, I think, answer his own question.

“This is the season to know that your project is not being funded next year. Our next [fiscal year] starts in July. The group I work for is made up of seven divisions.  It was just announced yesterday that five of them will not be funded next year (similar to the Courier)."

Microsoft has proven themselves capable in the hardware world – the Xbox 360 is a work of genius, and continues to be a nice anchor for Microsoft in people’s households, despite not being the runaway commercial success that their other enterprise products are. Microsoft knows, though, that it doesn’t have a thriving enough media ecosystem for an open-ended pad-like device to work as a net benefit for them the same way that the Xbox works. They don’t adhere to the closed ecosystem model that Apple is built on, and they know that the pads in general, and the Courier specifically, will clearly be a cool device, but not a profitable one, and most likely one that isn’t going to fit nicely in the “shared computing space” strategy Microsoft is pursuing long term.

HP’s Cancellation is a Different Story Altogether

Certainly, the acquisition of Palm by HP plays into the solution for addressing both the issue of a well formed developer community as well as the pricing problem.  For companies that aren’t Microsoft, and when you’re talking about devices that are generally lower-priced than a desktop or laptop, a measurable percentage of the cost structure are the license fees for the operating system.  With the Palm acquisition, any devices that would have normally been created on a Microsoft platform can now be adapted to the WebOS platform.

"Smartphones are a part of this, but this is really about the Web operating system," Shane Robison, HP’s chief strategy and technology officer, told Forbes. "It’s a change in our business model to a connected device model." HP, he said, is assuming a world in which almost everything needs at least the potential to connect to the Internet.

This also solves the problem of the developer community for HP’s initiatives in other areas.  HP has a consumer facing ecosystem of products that rival in number just about any other tech company you can name, as well as a thriving enterprise line-up. Certainly not all their products are suitable for WebOS, at least not presently, but switching to an operating system that’s so easy to develop for won’t hurt things as they try to get folks to write apps for display devices (which aren’t presently televisions, but aren’t far from it), apps to run on their printers, management apps to run on their routing equipment … the list goes on.

Add to that the existing burgeoning app catalog and developer community HP bought with Palm, and you’re talking about easy justification for the purchase of Palm for HP.

I expect to see Palm’s operating system and expertise applied across a broad cross-section of HP’s products – it just makes sense in so many ways. What doesn’t make sense is trying to compete against yourself with a Microsoft powered tablet that you know, if you started over today on it, you could do better and cheaper.