7.22.2008

A Cocktail of Edgy Design with Unstoppable Innovation…


Over the past few years we have experienced a few really big moments: joining the HP family; creating a start-up business within HP; launching Blackbird; setting up a dedicated Voodoo Business Unit; and more recently introducing the Omen and Envy 133.

Yesterday was another big one: it’s been announced internally that the Voodoo products are no longer going to be stand-alone entities, but rather they have been welcomed into the greater HP catalogue.

What does this mean?

Ultimately it means that Voodoo and Voodoo-influenced products will be easier to buy, faster to get, they will feature local service, and they will have the full power of HP’s marketing and sales channel behind them. The bottom line is we have ignited the brand and sparked big excitement; so we are now integrating our organizations to fuel our growth.

Since we were acquired by HP in 2006 the plan was always to transform cutting edge ideas and innovations from the high end Voodoo portfolio into various parts of HP’s portfolio. Thanks to the overwhelmingly positive response over our latest products the plan is now being accelerated ultimately making it a reality sooner than any of us ever imagined.

We’re lucky to be part of an organization that appreciates everything we have built and accomplished so far. The great news is we’re all heading in the same direction, and it’s a good thing – it’s a real good thing.

I wanted to take a moment to comment on the press that's been assuming the Voodoo brand is gone - this is not the case. I commented on Engadget, here are my comments below;

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Hi guys,

Being on the inside, and also being that I'm the founder of Voodoo and one of the key people setting up the integration, here's what I can tell you;

1) The Voodoo brand is important to HP, very important, so it will remain.

2) This is the next big step in our evolution, and it will give us the opportunity to expand our product line across the globe. Customers asked for it, so they get it --- that's the bottom line.

3) You can look forward to an expanded portfolio, more widely available, with local support and service. This is the kind of thing that Voodoo does not offer today but needs to offer in order to grow effectively.

13 comments:

James King said...

I see now why you didn't answer my question regarding the Envy's availability at retail. This is good news especially from a marketing and advertising standpoint... even more so if Voodoo continues to be featured as a distinct brand. Will Voodoo have a dedicated area in retail stores, like Apple? I may be jumping the gun here but it would be cool to see Voodoo gear in person.

That being said, I hope Voodoo continues to be a vanguard brand for HP. I'd hate to see it watered down and commoditized. You guys are going in the right direction so hopefully you'll still have the autonomy to push the brand forward. I personally think that HP should reduce its PC offerings and make just a few really solid, innovative designs with Voodoo's product line leading the way. I've always appreciated the simplicity of Apple's product line and I think it would help strengthen the perception of PCs as items of value and quality rather than commodities.

Cyborg Ninja said...

To echo the words of James above, it would be terrific to see more marketing muscle behind the Voodoo brand just so long as HP resist the urge start tinkering and trying to boost the HP brand perception by 'partnering' the HP logo with the Voodoo product line.

It might start with a small innocuous HP badge on the back of an Envy yet end up with a massive one on the front in about 6 months.

It is a delicate line to walk though as the greater awareness and availability would boost sales but might harm the specialist and elite reputation that has been cultivated so far. Either way, as long as the quality remains strong it should be a great move...

I know you are fond of car companies Rahul but perhaps the Fiat/Ferrari model is one to follow here - same company but wholly different brands which have pretty much avoided straying in to each other's territory.

Anonymous said...

Thats the Voodoo brand over with then. Well done for signing your business away.

Anonymous said...

I second the two comments above.

I wouldn't want my Voodoo laptop be branded as an HP. Voodoo is all about status, individuality and ultimate performance. HP is mass consumer products.

Hopefully HP will not try to dilute the Voodoo brand in hope of adding some value to its own.

Anonymous said...

What I'd like to know is, will this integration translate into more affordable prices for Voodoo rigs?

It's no secret that gaming pcs are overpriced, and that enthusiasts don't mind paying the higher prices because of the "bragging rights" they're purchasing, as well as subsidizing high-end components. But that's always been the reason why high-end gaming hasn't caught on as much with the general public -- gaming rigs and components cost too much! It's a circular paradigm which has devolved into a downward spiral for computer gamers. And you also have to factor in the entry of relatively cheaper video consoles with ever-increasing processing and rendering capabilities. In addition, pirating is seriously hurting pc gaming; just look at how many developers and publishers are talking about moving to exclusively console games (Madden 09 for the pc? Ain't gonna happen.).

If Voodoo and the other boutique vendors want pc gaming to continue to be a viable option, they need to get off their high horses and start making affordable high-end rigs that the masses can buy. Hopefully, this was the reason Voodoo merged with HP.

Anonymous said...

In my previous comment, I neglected to touch on the marketing aspect of Voodoo's integration with HP. Sure, piggybacking off of HP's superior marketing muscle is great. But if it doens't result in lower, more affordable prices for gaming pcs, then it hasn't achieved very much. For example, BMWs are marketing pretty strongly, but you don't see everyone driving one. And the reason is because they're too expensive -- which for many BMW owners is a selling point, I'm sure. But gaming pcs aren't luxury cars; for this market to continue, people need to be able to afford the product.

James King said...

I'm not sure if Voodoo should focus on price... my opinion is that "value" is a better metric at the high-end. Voodoo should very much attempt to maintain its "boutique" status but I don't think that means that it can't create products that are priced reasonably... not necessarily inexpensively but REASONABLY. I'd love to see Rahul's take on the "netbook" concept with some cutting-edge Voodoo innovation. Could Voodoo put out a sub-4lb/above 4hr battery life netbook at under a grand? That's where innovation comes in.

As far as I'm concerned, Voodoo is a BRAND first and foremost and the products should reflect what the brand stands for... cutting edge design and performance. A Voodoo netbook shouldn't be the best performing laptop on the planet but it should be the BEST netbook available, featuring design and innovations that significantly improve the computing experience. Those innovations should filter down HP's product line over time while Voodoo continues to drive innovation forward. Volume is nice and if they can produce cutting-edge products AND sell in volume that would be great... Apple's doing it so it obviously CAN be done. But maintaining the brand's reputation should be paramount to HP. Voodoo should always be a symbol of what's really possible with PC technology.

Like Cyborg Ninja stated, as long as the quality is there, people will respond. Hopefully, the big-wigs at HP understand that Voodoo should EXCITE people about PC technology.

I hate to make statements for Rahul but that's how I've always viewed Voodoo. Just my opinion.

Anonymous said...

I can respect what James said regarding quality. But is anyone really willing to make the argument that quality can be bought at a high price, or that a high price automatically guarantees quality?

There are obviously people out there who, as my father used to say, "have more money than they have sense". If they want to plop down $5 - $20K on a computer that will depreciate in value even before the last screw is put in, because it enhances their self-esteem or confirms their superiority, then God bless them. But will those people buy enough copies of the same games to keep the market alive, and give devs and publishers enough financial incentive to make pc games as opposed to 360 or PS3 games?

Sure, I want quality. But my ego is secure enough that I don't need to overpay for it. And my intellect is developed enough to know that I don't have to.

James King said...

To anonymous:

You're right... but you may have to accept that Voodoo is not the right brand for you. I'd love a Maserati Quattroporte right now, but I'm currently not in the right demographic for it. And I probably wouldn't want a $25000 Maserati because I can't imagine that it would have the quality that has become synonymous with the Maserati brand. More importantly, I doubt I'll ever see a $25000 Maserati because the people who manage the company are probably smart enough to understand that such a car would dilute its brand.

I think you have every right to want a very high-performing PC at a great price. I just don't think that Voodoo should be the company that provides it. With HP, Voodoo has an infrastructure that gives it a competitive edge against other ultra-high-end PC makers... but if it starts to build PCs for price/performance then it becomes a competitor with HP, "biting the hand that feeds it" so to speak. Not to mention the other massive competition it would face in Dell, Acer, Lenovo and Apple. Voodoo should be feasting on marketshare from Alienware, other boutique PC builders, and Dell's XPS line, maybe even a touch of Apple. But once it starts to compete primarily on price then it starts to swim with the big fish. That wouldn't be very smart, not unless it can create some really awesome designs with great quality at awesome prices. But then you are talking razor-thin margins... maybe it could steal marketshare but Voodoo can't sustain a business that way. That is, unless HP was willing to subsidize it like Microsoft does with the XBox and Zune. But that's a completely separate issue.

Anonymous said...

Sorry, I meant to write "But is anyone really willing to make the argument that quality can ONLY be bought at a high price...".

I'd like to mention that I appreciate that Rahool is providing me the opportunity to post my views on the subject of high-end pcs, even though my views aren't exactly in support of these rigs. I'm a hardcore gamer, and I'm bothered by what's happening, such as developers saying they either won't develop games for the pc, or they will no longer develop exclusively for them. I understand this is a financial decision. The solution is to make gaming more affordable, not more exclusive.

Rahool, I've read your blog long enough to believe that you're far ahead of most in the industry with what's going on and what will shape the future of gaming. I'm also willing to bet that this has played some part in your decision to integrate with HP.

I wish you and Voodoo all the best; if anyone can pull off the whole quality-at-an-affordable price, it's you. I just hope that, in the not-to-distant future, I'll be able to afford one of your works of magnificent beasts! ; )

Anonymous said...

Again, James, I can appreciate what you're saying. But consider one thing: if Alienware, Overdrive PC, Hypersonic and Voodoo were taking in such great margins, then why have they all opted to integrate with other companies? You referenced HP's marketing prowess as a reason for Voodoo's decision, but if the margins were there, then they obviously wouldn't need HP. Especially when merging with HP would bring their own quality into question.

One thing we do both agree on; an overpriced gaming pc isn't right for me. I don't go to the extreme of arguing that, by offering a more reasonalbly priced gaming rig, Voodoo will be competing with HP. No serious gamer would argue that HP makes a worthy gaming rig. This is probably one reason for buying Voodoo.

To use the automobile analogy once again, at the beginning of the energy crisis of the early 70's, US manufacturers were reluctant to walk away from their traditional bread-and-butter line of big, gazz-guzzlers that provided bigger profit margins. Then along come Japanese car makers like Toyota, who offered Americans smaller,quality "ecoboxes" as they were known then. Even with the competition from the Japanese, GM, Chrysler and Ford still continued to make big cars, and relied on marketing (sportier styling) as opposed to better quality to sell their cars. Well, in these days of $4 a gallon gas, guess who's now the largest auto manufacturer in the world? Toyota!

You still seem to be relying on the argument that quality can be bought only at a high price, and that a high price guarantees quality. You also don't seem to be taking into account the changes taking place in the pc gaming market. If the decision to buid and upgrade streets and highways were dependent soley on luxury car owners, we wouldn't have very many streets or highways. PC rigs and components are overpriced. Component makers offer products that are often deeply discounted within the first month or two. Look at NVidia 280 cards -- it was only competion from ATI's 4870s that made them mark down prices to a more realistic level.

By the way, I apologize to Rahul for misspelling his name in my previous response. It was late, I was sleepy and had a hard day at work. ; )

James King said...

To Anonymous:

"...if Alienware, Overdrive PC, Hypersonic and Voodoo were taking in such great margins, then why have they all opted to integrate with other companies? You referenced HP's marketing prowess as a reason for Voodoo's decision, but if the margins were there, then they obviously wouldn't need HP. Especially when merging with HP would bring their own quality into question."

One word: Capital. HP has much deeper pockets... Voodoo's high margins were likely sucked up by business expenses. So its ability to innovate at a scale that would give it a distinct edge against its competition was much lower as an independent company, especially when its competitors started finding deep pocketed partners. Add in HP's R&D assets and Voodoo has a partner that gives it a distinct financial and TECHNOLOGICAL edge.

As for the quality issue, with the additional capital and HP's economies of scale, the quality of Voodoo's products will likely improve significantly. Voodoo's customer service and tech support resources are now orders of magnitude greater than when it was independent. The same for Alienware and the others that were purchased by bigger, more profitable companies.

"One thing we do both agree on; an overpriced gaming pc isn't right for me. I don't go to the extreme of arguing that, by offering a more reasonalbly priced gaming rig, Voodoo will be competing with HP. No serious gamer would argue that HP makes a worthy gaming rig. This is probably one reason for buying Voodoo."

Have to disagree on this point... technology has matured to the point that almost ANY decently spec'ed PC currently available can play the vast majority of games. Voodoo's edge comes in its reputation and brand value, which is why I've stated that HP should not assimilate Voodoo so much as position it as its leading edge brand. If you want an example of competition between two brands owned by the same company, just look at Dell's XPS and Alienware lines. XPS has to be cannibalizing Alienware greatly... I personally think Dell keeps Alienware alive strictly for the people who can't abide by having the word "Dell" on their gaming rigs... which is ironic because Dell has a long history of making excellent, inexpensive gaming PCs. It was the first company to get a perfect 10 in MaximumPC for a gaming rig and it was quite a while before another perfect 10 was awarded (to Voodoo). HP makes what is arguably the best gaming PC on the market right now, the Blackbird with VoodooDNA. The Voodoo brand seems to now be less gaming focused and more design oriented, a la Apple. This is smart because it improves the value and lifespan of its systems as well as brand loyalty... Macs currently have a lifespan that is roughly double that of PCs, largely due to innovative design, as well as an excellent customer retention rate. Most PC buyers focus on price without brand loyalty.

"You still seem to be relying on the argument that quality can be bought only at a high price, and that a high price guarantees quality. You also don't seem to be taking into account the changes taking place in the pc gaming market. If the decision to buid and upgrade streets and highways were dependent soley on luxury car owners, we wouldn't have very many streets or highways."

No, I'm just trying to say that Voodoo is not in the same volume business as HP. I'm sure Rahul would love to sell a crapload of PCs but, even in his best situation, Voodoo's would sell only a fraction of what HP or Dell sells. For Voodoo, price isn't a primary factor. Obviously it should attempt to find good price points for its products but a bleeding-edge system is going to be expensive. A reality of business is that a premium is charged for products of exceptional quality and design. Maybe you could argue that no PC is so advanced that people should pay a premium for it but Apple has done good business doing just that.

In any case, if you are looking for a high-quality gaming rig at a good price, you could just get an HP Blackbird... numerous publications have compared its cost to home built systems and have found the costs remarkably close. It's not a Voodoo but, considering Voodoo collaborated with HP on its design and it is Voodoo co-branded, that's pretty decent. Just my opinion.

Teemo said...

Still not available in the UK??? As they say in Scotland, "Tha's pish!"
HP's Targetted Growth Strategy obviously doesn't consider us a worthy group.