HP Focuses On Acquisitions And Integration - InformationWeek

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6/15/2004
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HP Focuses On Acquisitions And Integration

Company strives to provide a better out-of-the-box experience for customers.

Hewlett-Packard executives say integration is the key to decreasing the complexity of the company's many software products, particularly as the company expands efforts to make it easier for small and midsize businesses to use its products. That becomes even more important as HP continues to expand its offerings through internal development, partnerships, and acquisitions. Those new offerings could, at least initially, add to overall platform complexity.

Platform integration requirements of customers will favor those companies with extensive portfolios that are prepared to take their investments to the next level, Todd DeLaughter, VP of HP's management software organization, said at the HP Software Forum in Montreal this week. But those companies all face a major challenge in making those vast offerings readily usable.

"Enterprises today are looking for integration solutions that are comprehensive, and you can't merge IT solutions with point solutions that don't talk to each other," DeLaughter says. "Their patience with point integrations is wearing thin."

HP is addressing this strategy with its Adaptive Enterprise framework. In the past year, it has rolled out about 40 product updates, expanded partnerships with companies like SAP and BEA, and made six acquisitions, including Novadigm and Consera for change and configuration management and Talking Blocks for creating an integration platform using a service-oriented architecture, he says.

HP in the past has talked about using a billion-dollar war chest to make acquisitions to enhance its strategy. But DeLaughter says the company may spend more or less then that depending on opportunities that present themselves.

Sandeep Johri, VP of strategic business planning for HP's management software organization, is in charge of evaluating potentially acquisitions and says security and asset management, both in the enterprise and service management markets, are key areas that the company will attempt to address in the coming year through partnerships or acquisitions. A crucial factor when it comes to evaluating an acquisition is how easy it will be to integrate the target company's products into HPs existing platform, Johri says. Many of the companies it has bought already had a level of integration with HP's OpenView platform.

Later this year, DeLaughter says HP will offer Xeon and Itanium-based servers with preconfigured and integrated OpenView software, including offerings that feature Novadigm configuration management.

"There is a general need in the industry for easier, out-of-the-box products," he says. "Preconfigured products is one way to remove complexity. Companies want to spend less on custom integration."

DeLaughter says that HP doesn't intend to release any portion of its OpenView software to the open-source community, like Computer Associates recently did with its Ingres Enterprise Relational Database. "I don't have a compelling business reason to do that right now," DeLaughter says.

"When you don't see a product succeeding, sometimes people look at going open source," Johri says. "We already have strong business opportunities and don't see the benefit of making it open source."

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