As expected, Hewlett-Packard rolled out its cloud computing strategy at the HP Summit yesterday. HP partners, for the most part, are withholding full judgment till they see more details -- which were in short supply at yesterday’s four-hour event in San Francisco.
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“I want to see how they pitch this at APC,” said one long-time HP partner out West. HP’s America’s Partner Conference kicks off March 28 in Las Vegas.
At first blush, however, some said HP CEO Leo Apotheker’s description of an HP-built and hosted public cloud infrastructure and an HP app store for enterprise and consumer applications was worrisome to partners.
“Sounds like a very direct model to me,” this partner said. “Carly tried that and look how well she did.” (Former HP chairman and CEO Carly Fiorina was shown the door six years ago. One of her missteps, according to some, was an ill-fated push into the consumer space with such items as an HP-branded iPod. It was announced in January 2004, started selling that summer and was killed off within a year.)
It’s one thing for a company like Google to pitch and maintain a self-hosted market of products and services. It is quite another for a legacy IT giant with a huge army of existing VARs, integrators and other partners to do the same. Just ask Microsoft.
Uncertainty clouds partner view of HP cloud
HP execs up to and including Apotheker mentioned that partners will have a role in HP’s cloud world, but they didn't spell out that role other than to say that large service providers will be able to resell the HP cloud infrastructure either under the HP banner or their own.
Another HP partner, Paul Shoberg, director of sales at Works Computing Inc., said he really wants more information on the cloud push which, he agreed, is crucial to HP’s future. Overall, he saw nothing hugely positive or negative for the channel in Monday’s event, “but then again it wasn’t aimed for us.”Indeed, the summit targeted Wall Street analysts and shareholders.
For that constituency HP CFO Cathie Lesjak announced a 50% increase in the company’s dividend to 12 cents per share. There was not much immediate impact as HP shares slid 2% Tuesday, probably due to the bad news from the Japan tsunami.
Phew! No more huge HP cuts
One area of relief for many tried-and-true HP partners was Apotheker’s message that he would focus on “operational growth and excellence.” The latent message was that the company would grow organically and via disciplined acquisitions rather than by making more draconian cuts to boost margins and placate Wall Street.
After the uncomfortable departure of former CEO Mark Hurd last August, even some Hurd boosters in the channel said Hurd’s main strengths lay in cutting costs versus espousing a coherent and inspiring vision. That was helpful in cutting bloat -- which everyone agreed was a problem -- but also hurt HP. Much of the company’s financial upside came as a result of those cuts, not from innovative products and services, critics said.
“One of the first things Leo did coming in was to restore pay cuts to some HP executives, and I thought that built a lot of good will,” said a second HP partner from the Midwest.
Still, this VAR and others in the HP channel remain unsure whether Apotheker is the guy who can lead HP to the next level and erase the angst created by the HP board in the last year.
“I saw nothing compelling [in Monday’s announcement] the Midwestern VAR said. “I am not thinking that [Apotheker] has the charisma needed to fire this company up. I’m not judging, but he is not the guy.”