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What We Do in Life..... Echoes...!

Well, the marriage finally happened, Hewlett Packard and Compaq that is, all $87 billion of a partnership, which, among other ambitions aims to kick poor Dell where it hurts.

Confirmed optimist that I am, I think it will probably be a near term and very expensive disaster at a delicate time in the industry’s history, but let’s all hope that the first year’s trading results prove me wrong.

The new Hewlett Packard, HPQ, will of course keep the Compaq brand visible on some products going forward. After all, $19 Billion bought the company some pretty sizeable brand awareness and thousands of big corporations still feel comfortable with the Compaq brand

What will go is my relatively new HP Ominibook laptop. It appears that HP has conceded that Compaq makes better portables unless this part of some hidden compromise. Compaq’s workstation business will disappear and in the Pocket PC space, you can wave goodbye to the Jornada in favour of the Ipaq.

In order to out-compete Dell, the new HP has a new website, the HP Online Store, working. This now offers access to some 10,000 products and configurations. The objective is to move HP swiftly into second place as the largest web marketer with faster growth than archrival Dell Computer faster than Dell Apparently the new site has attracted $5 billion worth of new business in the last three months.

The HP/Compaq connection continues to raise some interesting ideas around the Microsoft relation. In particular, the constant effort to push Windows 2000 Datacenter into the Enterprise. Not so long ago, I wrote that Microsoft was starting to worry over the emphasis that IBM is placing behind AIX and Linux and of course, now we see Hewlett Packard swallowing Compaq, traditionally Microsoft’s favourite friend and now the property of a company, which has its own multi-platform agenda for the enterprise. Not a happy prospect for Redmond.

Enter of course Unisys, the product of an earlier mega-merger (Sperry & Burroughs) which didn’t quite go according to plan. I keep wondering about the company and where it sits, now squeezed between some very large playmates.

According to a story in Client Server News, research consultancy Illuminata has reported that the Unisys share of the joint ES7000-Windows 2000 Datacenter promotion, represents 10% of the total annual revenues that Unisys realises from the ES7000 platform, “A huge expenditure relative to revenue."

While Unisys is steadily moving more of its business focus towards the provision of services, 74% of 2001 company revenues, it’s debatable whether this kind of marketing spend in support of its hardware business is sound. Illuminata, speculates, as I have done in several previous columns, whether Unisys can continue in the market as a systems vendor selling Windows mainframes and if the new campaign doesn’t succeed, then Unisys may find itself forced into the services sector for good.

On reflection then, the Unisys/Microsoft “Big Iron” Datacenter campaign could well prove pivotal for both companies. Unisys MD Brian Hadfield once told me that the company had “Bet the Farm on Windows”. Ironically, Microsoft might have done the same with Unisys.


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