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HP-Cisco networking battle heats up with 3Com

VARs with ties to both HP and Cisco gird for tense times ahead.

Now that Hewlett-Packard has 3Com aboard, it's ready to plunge headlong into networking hardware -- taking on Cisco Systems Inc. And the prospect of an HP-Cisco war has VARs with ties to both computing giants increasingly anxious.

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HP ProCurve data center switches a battle cry to Cisco

HP vs. Cisco

"It's too early for me to really appreciate what this all means, but I worry that both HP and Cisco are pushing all-from-one-vendor solutions in a world that doesn't want them," said one long-time HP-Cisco VAR.

He also worries that this one-stop-shop push denigrates the role of integrators that traditionally put together multi-vendor solutions to meet customer needs.

"In my mind, I compare them both to Dell, which, for a long time has been a manufacturer and a distributor and a channel and an integrator. They're trying to obviate the channel," he said.

Both HP and Cisco are quick to pledge allegiance to VAR partners. On Monday, Dave Donatelli, HP's executive vice president for enterprise servers, storage and networking, said there's plenty of business for both HP and 3Com partners in this $40 billion market.

HP will also "recruit incremental" partners in certain areas, he said.

Donatelli also said HP's converged data center hardware and fabric move will not foreclose partner integrators or third-party products. Both Cisco and HP say their respective data center offerings are tightly integrated and optimized around their own components. On the other hand, they pledge complete loyalty to open standards. VARs say they can't have it both ways.

Donatelli disagreed with that contention. "It's not contradictory if you're HP. We built industry standards into the core of our products. We're the only company that devlelops our own servers, storage and networking. We integrate them from the ground up. No one else can say that. We always developed to open standards [because] customers don't want to be locked in."

Cisco shot heard round the IT world

Ever since Cisco CEO John Chambers launched that company's Unified Computing System (UCS) bid last year, VARs have privately aired concerns that both HP and Cisco would pressure them to take sides. Thus, a VAR -- that profitably and amicably sold HP servers, Cisco networking and storage from EMC or someone else into a joint account -- suddenly faced contention from his vendor partners.

Donatelli said that HP will not force the issue. "Our view is it's always a heterogeneous world out there and customers want choice. We offer VARs the same opportunity. Our goal is to offer better products, not pressure."

But, in the field, the pressure is already there.

A few months back, one large New England partner said he had been able to go into joint accounts with high-level support from both HP and Cisco. That cooperation has disappeared.

On the other hand, partners that have already picked sides are ready for battle. John Barker, president of Versatile Communications, a Marlborough, Mass., HP ProCurve partner said the addition of 3Com's core data center networking technology is a big plus. HP ProCurve gear was seen as mostly a "wiring closet" or edge networking solution. (HP ProCurve and 3Com networking gear will now carry the HP Networking label.)

"We're an anomaly," Barker said. "We've been at ProCurve for a long time and that meant we were in the background, if you will, because of the interesting HP-Cisco relationship. We're thrilled to see a split there and see tremendous opportunity. Have I witnessed pressure? Not really, but I'm not a Cisco shop. Realistically [though], there will be a certain amount of pressure.… [HP and Cisco] will say the right things, but it's the elephant in the room and some partners will be faced with tough decisions."

HP-Cisco VAR wars play out

The HP-Cisco channel contention will play out next week as Cisco hosts its annual partner summit in San Francisco and HP convenes its Americas Partner Conference in Las Vegas.

Many VAR organizations had to scramble to find people to send to both events. "This is like the old days of Henry Kissinger and shuttle diplomacy," joked the president of one East Coast HP and Cisco channel organization.

Asked why he thought there seemed to be so much bad blood between the vendors of late, he said he thinks it's human nature. "I'm convinced it's personal. These are hypercompetitive people who will go at it. I'm convinced that Cisco's culture requires them to have an enemy. It used to be 3Com, then Intel, then Avaya and that impacted those companies a lot. For awhile it was Microsoft but they backed away on that one. Now they've settled on HP as the enemy."

As for HP, another partner said CEO Mark Hurd was bound and determined not to let Cisco's UCS play go unchallenged, especially since HP is such a formidable presence in servers.

At the end of the day, a given partner may be tightly aligned with one or both players, but his primary concern has to be customer service, several integrators said.

"Denali is Advanced Integration. We will provide our customers and prospects with choices based on their individual needs for both short-term and long-term solutions," said John Convery, executive vice president of Denali Advanced Integration, Redmond, Wash.

Having said that, and after saying he is the HP guy at Denali, he thinks HP has the edge in this battle royale.

"With today's announcement, HP offers customer choice, increased innovation and lower costs. … As we head to Las Vegas for the HP APC next week, HP holds some very powerful cards. … Mark Hurd and the team hold a royal straight flush."

Indeed, with 3Com in tow, Hewlett-Packard can fill more of the check boxes of unified data center hardware than Cisco -- it is an incumbent power in servers, it had good edge networking products now augmented by 3Com at the core and it has several storage lines. It is relying on closer ties with Microsoft and Hyper-V to offset the Cisco-VMware alliance.

Several big questions remain from the HP-3Com deal. For example, will HP extend the lifetime warranty that covers its ProCurve gear to the higher-end 3Com products? And how will HP meld 3Com and HP ProCurve partners?

One thing's certain: HP-Cisco VARs will be keeping score very carefully.

Let us know what you think about the story; email Barbara Darrow, Senior News Director at, or follow us on twitter.

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