HP merges server, storage and software businesses
HP merges server, storage and software businesses
Hewlett-Packard has announced that it has merged its services and high-end computing sectors together to create a more integrated solution to fix customer problems.
Ann Livermore will be in charge of the much larger unit, which accounts for US$28 billion of revenue in HP's last fiscal year.
The new division will include HP's 650,000-person services unit, as well as the server computer, storage and software businesses.
The aim is enable products to be packed more effectively for end-users, but some people believe that service businesses will appear less independent to customers.
Richard L. Ptak, principal at Ptak, Noel & Associates said that HP is reproducing a strategy that was tried and failed at Compaq.
He said that the strategy offers bundles of services, systems and softwares at a reduced cost. But the problem becomes pricing of services, because it is difficult to competitively price and deliver services.
He added that under this system, it is difficult to accurately keep track of the actual cost of services; and easy to fool yourself into thinking you are making money when you are not.
Gordon Haff, an analyst at research firm Illuminata said it makes it difficult for HP services to go in there and say they'll help you select the best systems for your problem, no matter whom they come from.
Livermore, however, maintains that HP is a leader in servers, storage, software and services. Gartner research backs this up by claiming HP is the no.2 in server sales and no.2 in sales of a key class of data storage gear.
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