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June 14, 2005

A small step back to the old-school HP

The vendor who offers an alternative to your HP 3000 rolled back the clock a little yesterday, though not far enough to recant its flight from the 3000. But HP announced that it's taking those printer and PC units and splitting them apart, a full about-face from the Carly Fiorina strategy in January of "a bigger HP is a better HP." Now that it's got a new CEO, HP is reorganizing, back toward a business plan that recognizes not all products are alike.

HP put the news of the split-up of PCs and printers in the second paragraph of its press release that announced former PalmOne exec Todd Bradley as new head of a separate PC unit. Don't look for a full spinoff of the printer business from the rest of HP soon. You don't appoint a fellow to run a unit just to spin it off.  Duane Zitzner's work to ensure a smooth melding of PCs and printers now is just a memory. Mainstream computing press coverage — at the San Jose Mercury News as well as on CNET — has focused on the flip-flop in HP's strategy

The move looks like the first of perhaps several significant rollbacks to a style that created the HP 3000 and its marketplace. Back in those days of the 1970s, every product line from HP was not only its own division, it often operated as if it were its own company. This was the era that created the acronymn "CSY," meaning Computer SYstems Division. The HP 3000 sensibility lives on in the vendor at cubicles and desktops where virtual CSY employees (yeah, vCSY'ers, they call themselves) still spend parts of their day on 3000 engineering and planning.

What splitting printers from PCs will mean to the 3000 customer depends on your current point of view about HP. If it's the company providing a 3000 replacement, you might be glad that PCs and printers seem like different kinds of businesses once again. Part of the problem with the HP's 1990s management of its computer business: everything was supposed to thrive on the laser printer business model. Smaller direct sales channel, less room for different and superior engineering — this is the fallout of chasing the commodity computing model.

On the other hand, if HP is the company that's abandoning your company's bulwark server, then the PC-printer split-up could mean that Dell might have to sharpen its pencil to get your desktop business. These units get separated to give them room to manuever, especially on areas like pricing.

And if HP is the company you're leaving behind while you are forced to drop off your 3000 in a few years — well, another spinoff of its enterprise computing business, the non-Windows servers driven by the likes HP-UX and OpenVMS, could be just around the corner. That might make IBM more competitive in Unix alternatives, or push Sun even further out into discount land.

03:55 PM in News Outta HP | Permalink

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