September 28, 2006 3:54 PM PDT

HP to acquire Voodoo Computers

Voodoo Computers has agreed to be acquired by Hewlett-Packard, Voodoo founder and Chief Technology Officer Rahul Sood announced on his blog Thursday.

Details of the transaction were not released. Rahul Sood and his brother Ravi, currently the CEO of Voodoo, will take positions within a new game business unit in HP's Personal Systems Group reporting to Phil McKinney, that group's chief technology officer, according to the posting on Rahul Sood's blog.

HP's new products

Voodoo makes expensive high-end PCs for gamers and PC enthusiasts, often with flashy designs and cases. This is a relatively small portion of the PC market, but it yields higher margins than the mainstream market. Customers of companies like Voodoo, Alienware and Falcon Northwest are thought to wield influence over less tech-savvy friends and colleagues.

Earlier this year, Dell brought Alienware into its company as a wholly owned subsidiary, hoping to learn more about these high-end customers and take advantage of the profits. In the weeks prior to that acquisition, Rahul Sood predicted the looming deal after having similar acquisition-related conversations with Dell Chairman Michael Dell, he later revealed on his blog.

Rahul Sood will become chief technologist in HP's game division, and Ravi Sood will take on the role of chief strategist, Rahul Sood wrote on the blog. Voodoo will maintain a presence in Calgary, Alberta, where the company is currently headquartered. The deal is expected to close in November, HP said in a press release.

Voodoo becomes the latest company acquired by HP since CEO Mark Hurd arrived at the company last year. Hurd, who spent Thursday testifying before Congress as part of the investigation into HP's boardroom leak scandal, has also given the nod to purchases of Mercury Interactive and Peregrine Systems, in addition to smaller acquisitions.

HP also announced a series of new consumer products at an event in New York Thursday evening. The company is embracing high-definition video with a notebook and a Media Center PC with HD DVD drives, as well as an external HD DVD drive. The company also hopes to accommodate the increased storage requirements of high-definition video with an HP Media Vault, which can store up to 1.2 terabytes of data in higher-end configurations.

In addition, the company plans to hook up with Yahoo to bundle Yahoo's software onto HP PCs sold to consumers in North America and Europe. This includes a co-branded HP Yahoo toolbar, a default Yahoo start page and a preset search box featuring Yahoo's technology, the companies said. Dell and Google announced a similar relationship earlier this year.

See more CNET content tagged:
Voodoo, Mark Hurd, acquisition, HD-DVD, Alienware

4 comments

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So long Voodoo
Never owned one, but now I am guaranteed never to own one. Looks like when I finally get around to picking up my next gaming PC, my choices are Alienware and Falcon.
Posted by ballssalty (219 comments )
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So long Voodoo
I agree with the first poster. I would have considered a Voodoo machine before this buy out. HP will bring the once cool Voodoo down to their level. I've had great luck with Dell, so I'll just stick with them.
Posted by cej4 (1 comment )
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Too bad..
So HP is buying Voodoo, & Alienware was aquired by Dell...that can't be good!
Posted by M A (51 comments )
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so what's next?
Falcon Northwest bought by Gateway? Or worse, Sony?
Posted by techguy83 (295 comments )
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