HP announced Monday it has sold webOS' source code and is transferring the engineers who worked on it to South Korean tech giant LG, which plans to use the software in its "smart" TVs and other products that could connect to the Internet and run apps, such as car navigation systems, digital signs and possibly smart appliances.
HP will retain Palm's patents but will license them to LG. It also will keep webOS' cloud-related software and engineers.
"It's a tremendous opportunity for both companies to really focus," said Martin Risau, an HP senior vice president and general manager who ran the webOS business for HP.
After discontinuing its line of webOS devices in 2011, HP soon after made the software available through an open-source license. Under the deal announced Monday, LG has acquired the parts of webOS that HP open sourced and the parts that it had retained exclusive rights to. LG plans to continue to maintain webOS as an open-source project, said Sam Chang, vice president and general manager of smart TV innovation at LG. That means that programmers outside LG could help develop webOS and other companies could potentially use it in their own products.
The companies did not disclose the financial terms of the deal, which is already complete. Risau said the number of employees transferred from HP to LG was "in the dozens," but declined to be more specific. In the next several months, LG will open offices in San Francisco and Sunnyvale to house its new webOS operations, Chang said.
The first LG televisions using webOS will be out "very soon," he said, but not this year. LG has been working with HP for about six months to customize webOS for use on TVs, he added.
Although Palm developed webOS for mobile devices, LG does not plan to use it in smartphones or tablets."We're looking at a lot more greener pasture in terms of the opportunities" for webOS, Chang said.
Palm, which was acquired by HP in 2010, launched webOS in 2009 as a means to power a new generation of smartphones that could better compete with Apple's (AAPL) iPhone. Although the software was widely praised by tech reviewers, webOS-powered devices never caught on with consumers.
LG's move to acquire webOS from HP makes sense for both companies, analysts said. For HP, which took a $3.3 billion write-off related to its Palm acquisition and the discontinuation of its webOS devices, the deal represents a chance "to get a return on a rather poor investment," said Van Baker, a consumer technology analyst at research firm Gartner.
For LG, webOS could help differentiate its smart televisions from those of its competitors, analysts said. While a growing number of televisions sold include apps and the ability to connect to the Internet, no operating system yet dominates the smart TV market.
Contact Troy Wolverton at 408-840-4285. Follow him at Twitter.com/troywolv.
WebOS' long road to LG
After being developed to compete with the iPhone, Palm's innovative software is getting new life on "smart" TVs
January 2009: Palm unveils webOS and its new Pre smartphone at the Consumer Electronics Show. The company positions the phone as a competitor to Apple's iPhone.
July 2010: Following disappointing sales of its webOS devices, Palm is acquired by HP, which announces plans to use the software on multiple devices, including its printers.
February 2011: HP announces the TouchPad, the first tablet to run webOS and the company's answer to the iPad.
March 2011: HP announces plan to ship webOS with all of its new PCs, starting in 2012.
June 2011: HP CEO Léo Apotheker floats the idea of licensing webOS to other companies.
August 2011: Amid disappointing financial results, HP announces it will cease production of all webOS devices
September 2011: HP lays off workers involved in making webOS devices; Meg Whitman replaces Apotheker.
November 2011: HP takes a $3.3 billion write-off related to its acquisition of Palm and the layoff of Palm workers.
December 2011: HP makes webOS available under an open-source license.
February 2013: HP announces the sale of the webOS source code and the transfer of engineers who worked on it to LG.
Source: Mercury News research