Rumor: Amazon to acquire Palm-webOS?

Amazon's announcement of its Kindle Fire Android-based tablet was a huge news event this week, but if a new rumor is correct that pales in comparison to what might be next for the online retailer. Venture Beat reports via unnamed sources that Amazon is in "serious negotiations" to acquire the Palm division from HP. That would include purchasing the rights to Palm's webOS operating system. The story claims that HP wants to sell off the Palm division quickly and that Amazon is very close to making the deal official. If true, that could mean that any future versions of Amazon's Kindle Fire tablet could be running on a version of Palm's webOS.

HP bought the Palm smartphone-operating system company back in 2010 for $1.2 billion and tried to launch its own webOS-based products. In July it launched its HP TouchPad tablet but sales were so bad that HP stopped production of the tablet in mid-August and slashed prices of the remaining units. Ironically, sales of the TouchPad soared so much after HP cut the price that the company decided to make one final batch of the tablets that should go on sale later this year. HP had said in the past that it was still interested in developing webOS and even licensing it out to third party companies.

It's not likely that Amazon will pay anywhere near $1.2 billion to acquire the Palm division from HP. If this deal is more than just a rumor it would be HP's first major effort to improve the company since it brought in its new president and CEO Meg Whitman last week.

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