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Can Meg Whitman save HP?

As computing has shifted more and more to mobile platforms, Hewlett-Packard has struggled to keep up with the times. CEO Meg Whitman has announced 50,000 job cuts, but the former Ebay CEO has made a big bet on the company's future
As computing has shifted more and more to mob... 03:33

PALO ALTO, Calif. - One company shedding jobs, lots of them, is technology pioneer Hewlett-Packard Co.

It's part of the strategy of Meg Whitman, the CEO hired to save the company.

Whitman was once the global marketing manager for Mr. Potato Head. But after her days in the toy industry at Hasbro, she grew eBay into a giant, bought Skype, and spent $144 million of her own money running for governor of California - an investment she lost.

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When she took over Hewlett-Packard nearly three years ago, Whitman literally tore down the executive walls. She moved everyone out into cubicles.

"When I got here this whole area was wood paneled offices, very formal. It looked like a bank. When I was at eBay, we sat in cubicles just like this and the interaction that happens is amazing," she told CBS News in an interview.

The 57-year-old CEO, who took eBay from 30 employees to 15,000 in her 10-year reign there, is now trying to turn around a tech legend, a 75-year-old company started in a Palo Alto garage - now recognized as the birthplace of Silicon Valley.

"Our industry is undergoing one the biggest shifts I've seen in my career," Whitman said.

As computing has shifted to mobile phones and the cloud, HP's growth has stalled. Whitman has announced 50,000 job cuts, about 14 percent of the company's workforce when she took over.

There aren't many tech companies that have been able to make this type of transition.

"You're right," said Whitman. "You have to be willing to cannibalize your existing business. Frankly, I'd rather do it to myself than have someone do it to me."

In Las Vegas this month, Whitman revealed that Hewlett-Packard is working on a radical redesign of computing, a project it calls "The Machine."

"This changes everything," she said in Las Vegas.

How? By building computers in an entirely new way, using light to move data instead of copper wires, and combining all forms of the computer's memory in the same place.

What will The Machine be able to do?

"It will be able to compute much faster with huge amounts of data," Whitman said. "And it will also take up a lot less space and pull a lot less energy."

HP has committed three-quarters of its lab staff to The Machine to have it ready by the end of the decade.

"It's a big bet," Whitman said. "We are taking a lot of the chips, in the Las Vegas analogy, and putting them on red."

How big a bet is it in terms of cost?

"It'll depend over time," she said. "But it'll need billions of dollars."

The CEO who built eBay knows Silicon Valley only rewards those who roll the dice.

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