Hewlett-Packard is set to keep its PC division which it had put up for sale, but it may shut down its webOS division, which was obtained for $1.2 billion in April 2010 when the company bought Palm. As webOS goes, 500 jobs are on the chopping block as well.

The company will now decide whether to keep the employees who were hired for the short-lived division, by moving them to a different division or to terminate their contracts. Since the arrival of webOS, the devices launched included Pre 2, Veer, TouchPad, and finally the Pre 3. Pre 2 and Pre 3, however, failed to make a mark and TouchPad only saw a little attention during the fire-sale and HP’s famous price cut of the device.

“HP objectively evaluated the strategic, financial and operational impact of spinning off PSG. It’s clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees,” said Meg Whitman, HP president and chief executive officer, in a statement. “HP is committed to PSG, and together we are stronger.”

No such comments were made about the webOS division and, according to Guardian, which spoke to an internal HP source, “There's a 95% chance we all get laid off between now and November, and I for one am thinking it's for the best.” Another employee told Guardian that this would affect nearly 500 jobs in the company.

Rumors are also rife that Amazon may acquire the webOS due to the presence of Amazon board of ex-Palm chief executive and HP executive Jon Rubinstein, who previously worked for Apple. However, nothing can be said for certain.

Currently, most of the users are more interested in getting Android running on the TouchPad than the webOS, according to the Guardian report.