HP Dives Back Into Video Conferencing With Poly Acquisition
By Jim Lundy
Hybrid work and the potential for a surge in demand for collaboration prompted Hewlett Packard (HP) to dive back into the collaboration market and buy Poly for $1.7 Billion. We say dive back in because it was the same HP that sold its video conferencing unit to Polycom in 2012. This blog analyzes the deal and what it means for the market.
HP Buys Poly–Deja Vu Moment
HP didn’t see the future when it sold its video conferencing unit in 2012. However, back then, it was still voice that was dominating in communications and collaboration. Now with video as the dial tone, HP wants back in. By acquiring Poly, HP now owns a leading provider of video conferencing hardware, phones, and headsets.
High Demand for Video Conferencing
Aragon expects demand to be very high for video conferencing equipment as we shift out to the office and live in the air of hybrid work. Most conference rooms throughout the world do not have display screens or the ability to have large group video meetings. This is expected to change as video conferencing rooms become standard–replacing the old projector systems. This is due to the fact that costs for large displays (e.g. 75 inch, 85 inch, and 90 inch) have plummeted–making the investment much more of a no-brainer.
The expected demand for video conferencing hardware bodes well for HP’s move to buy Poly. Poly provides some of the leading video conferencing equipment that is compatible with Microsoft, Zoom, RingCentral, and others.
Will Dell Buy Logitech?
With HP’s acquisition, it raises a question about other providers being acquired–such as Logitech, which offers similar products to Poly. Margins are shrinking for PCs and margins for video conferencing hardware look solid. This is one of the reasons why we could be entering a consolidation phase and Logitech could be the next logical acquisition for an organization like Dell.
The Bottom Line
HP is diving back into video conferencing with the Poly acquisition. Investment in R&D will be a critical success factor as many providers, including Cisco and Neat, continue to push the envelope on innovation.