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HP’s Software Olympics

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DQC Bureau
New Update

In the first Software Olympics 2001, HP gave away awards to

its partners at the idyllic tropical resort Island of Kota Kinabalu (which is

also the capital of Sabah state and happens to be a major industrial hub) in

Malaysia recently. And in the same breath HP egged on its partners to come back

triumphant yet again nine months later to another Olympics Awards ceremony.

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HP used the Software Olympics to reward its partners for

their outstanding performance in selling its network management software,

Open-View (and Voice over IP product VoiceCall), against Computer Associates’

Unicenter and Jasmine and IBM’s Tivoli to bring in a part of over $1 billion

in revenues for OpenView alone.

HP is pushing its Software Solutions Organization (SSO) into

the big league. It wants to make its $2 billion software business mostly coming

from OpenView to grow at a much faster pace. The first and foremost obstacle to

achieve this objective is software from CA, the mention of which makes every HP

executive sit up and grow in determination.

Betting big on channels



Software Olympics was the first big step HP took in APAC (which includes

Japan and Australia.) It is now energizing its 200 strong direct marketing force

which will compliment its channel. One of the immediate measures that HP has

taken is to work more closely with HP Consulting, one of the largest consulting

businesses in the world which attempted to grow into a monolith by

unsuccessfully trying to acquire PriceWaterhouseCooper in the recent past.

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Channel is HP SSO’s primary driver in the market, asserts

Peter van der Fluit, VP, Worldwide Software Sales and Marketing, HP. The company

is assuring sales partners every assistance in winning a fierce price war that

is underway in the market. (The intensity of the price war can be gauged by the

fact that one of the HP’s rivals dropped its final quote by almost 125 per

cent from its original quote.)

"We are bullish about double digit growth in APAC,"

says HP SSO’s APAC Marketing Director, Jonathan Chiu. He brushes aside CA’s

threat and says if HP is facing any challenge then its from the emerging

companies like US-based Microwise. And he doesn’t forget to add that though

companies like Microwise are present in the market, they lack the kind of

product range HP touts and thus has restricted market access.

HP SSO is betting big on India and China. It announced a new

software lab in India recently. It is also planning to build developer

communities in the two countries and lavish on them. A Sun-type university

program is also in the pipeline.

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In India, Sun is HP’s biggest ally. Interestingly, over 50

per cent of OpenView installations are on Sun Solaris. "We are in initial

talks with Sun Micro in India to formalize a relationship which is mostly

unofficial today," says HP SSO’s country manager for India Amit

Chatterjee.

Towards ISM dominance



HP is betting on OpenView to dominate the Integrated Service Management

(ISM). It already leads the pack in network management but it is yet to

penetrate deep into other spaces of ISM like systems management and applications

management which is an area ruled by CA’s Unicenter and IBM’s Tivoli. HP

wants to become number one or number two in those spaces too.

To achieve this it has to displace either CA or IBM which are

earning far higher revenue today. In Fluit’s estimate HP will need three years

to catch up with CA or IBM in network management software, a gap, he says,

created by a large install base of legacy systems and main frames in which HP

has zero presence. In short what HP is eyeing is to take over the entire ISM

market.

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OpenView grew 14 per cent last year and has been transformed

from a framework based system to a modular one. This means each components of

OpenView can be implemented individually. This is what excites channel partners.

"It’s quite easy to sell OpenView than other solutions because its

modular," says a Wipro executive who oversees OpenView sales as part of his

portfolio.

HP is also bullish on its OpenCall platform which offers

Voice over IP solutions to telco service industry. OpenCall has customers like

Nokia, Cisco, Logica and Vodaphone globally and India is expected to be a hot

market given the boom in the call center business here. The company has also

lined up several new product releases through the next two years which include a

voice portal builder in 2002 and a communication portal platform in 2002-03.

A slice of web services pie



If web services is considered to be the messiah for the IT industry in the

coming years then HP is gearing up for the emerging market with its knitted

"Netaction".

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Web services in short promises a smooth delivery of

information between Internet users. Consider you want to buy a flight ticket

from a travel portal. Now, the portal may not be operating the flights you want

but has a partnership with another portal which does. Your portal simply

connects to its partner’s and gets your ticket while you will not even know

where the ticket came from. Making these connections between websites and

portals and sharing information is what web services promise to deliver.

Netaction is a set of solutions which includes an application

server, acquired from the Bluestone merger, its independent programming language

Chai and e-speak frameworks which come in as HP Core Service Framework (CSF). A

combination of these solutions deliver various HP’s web services which can

work with .Net framework and SunOne standards equally well, points out Fluit.

HP’s message to its partners is simple: go and conquer the

market and we will be waiting for you with rewards. HP’s approach to the

emerging web services market interestingly resembles its peripherals business

model where there are definite products and services which bring in money in the

short term even as the company as a whole is putting together a modular

framework for web services to rival SunOne and .Net.

In India SSO sells 40 per cent through its channel partners.

It is now planning to strengthen its channel partner program and increase its

direct sales activities. The mantra at HP SSO these days is: On your mark, get

set OpenView.

Prashanth Hebbar in Kota Kinabalu (Malaysia)

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