Channel Marker

Mar 30 2011   4:18PM GMT

Top Ten Takeaways from HP APC

badarrow Barbara Darrow Profile: badarrow

LAS VEGAS–Hewlett-Packard’s Americas Partner Conference was chock-full of threads this week. Here’s what bubbled to the top. 

 1: The jury’s still out on whether new HP CEO Leo Apotheker is a true channel friend or not.  He said all the right things, APC attendees agreed. But, they remind each other, talk is cheap. It could very well be true that his silence over the first few months of his tenure was natural for a guy trying to get his mind around a very, very big company. Or, maybe not.

2: HP Technology Services was not the belle of this particular ball.  A good chunk of attendees headed for the exits when Gary Budzinski took the stage Tuesday. Several partner sources said while HP is opening up more of its services offerings to partners, most VARs see it more as a competitor than an asset.

3: Partners “get” that HP wants them to sell all of its products, across groups, but even the most loyal said it makes no sense for them to go 100% HP.  There was a lot of HP-led talk about HP “franchise” partners. Said one: “I love HP. I love its products. But I’m a little VAR, I have to pick my battles and they’re in way too many battles.” And,  it is a big gamble to put all your eggs in one vendor’s basket.

4: Oracle was the enemy du jour, but Cisco wasn’t far behind. Nor Apple. Executive VP Dave Donatelli called out Oracle for discontinuing software development for Itanium.

Oracle’s move targeted the Unix market, he said. “A reasonable person looking at this will scratch their head. In Itanium market share, Unix share, we held steady at 26 to 27%. A decision like that gets made when you’re losing share,” he said.

“Since Oracle acquired Sun, we surpassed Sun in share. They’re number three and we’re number two. One area they missed in their guidance was in Sun hardware revenue. This was a unilateral decision and anti-competitive behavior,” he noted. Then he asked HP partners to lobby Oracle to reverse itself.

5: Channel guy Stephen DiFranco and team did a good job highlighting small-but-growing HP VARS–many of which started–in the HP way–in someone’s garage or dorm room.

6: Even skeptics toting iPads at the show seem convinced that HP might make a go of its TouchPad/WebOS tandem provided it gets them out the door.  The company needs to “thread the needle” between the closed-off iTunes/iPhone/iPod fantasy island and the no-holds-barred Android chaos where every carrier seems to have its own Android version.

7: HP Networking’s done good. Real good.  Including the 3Com acquisition, that business grew 183% in the first quarter compared to year-ago period. Without 3Com, growth would have been 30%. The gazillion dollar question is whether that momentum can be sustained and whether Cisco networking will continue its anemic performance. Cisco, apparently,  is so fixated on UCS and “immersive” video that it’s let its bread-and-butter switching and routing business wilt. (Make no mistake though, Cisco’s still number one in networking overall. )

HP seems serious about keeping that networking mo-jo going, unveiling a slew of channel incentives including additional margin for competitive wins.

8: Surprise! Printing’s still a good business and the continuing rage for mobility and new form-factor devices will only accelerate that. VARs that haven’t dabbled in multifunction printers or managed print services, should take a look at them now. HP ships 60 milliion printers a year.  A recurrent theme was HP pc/laptop/smart phone/tablet products as onramp and printers the offramp to the cloud.

9: Channel conflict is a way of life. Interesting to hear Randy Seidl tell hundreds of HP partners that if they’re in an account but NOT pushing all of  HP’s storage-server-and networking products in that account, HP will bring in a partner to compete with them. Gulp. Everyone knows that’s true, but that was pretty stark. “Symantec would do the same thing but sheesh,” grumbled one attendee.

Another brushed off the verbiage. “That’s just Randy.  He likes being a tough guy.”

10: Direct sales are not cheaper than channel sales.  DiFranco, VP and general manager of HP’s Solution Partners Organiztion, said internal research showed that HP in the past had not fully accounted for the cost of direct sales while it tracked every penny going towards a channel sale. That meant HP was underestimating the real cost of direct sales. Hopefully now that they’ve got their metrics straight, there really will be a reduction of conflict in the field.

Let us know what you think about the story; email Barbara Darrow, Senior News Director at bdarrow@techtarget.com.

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