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.
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.
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.
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.
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".
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)