June 30, 2015
Run-up to HP split-up sees enterprise splits
Later this week, Hewlett-Packard will announce the financial roadmap for the business that will become HP Enterprise, holder of the futures of the HP 3000 replacements from the vendor. More than the accounting is in flux, though. Today the vendor announced the executive VP of its Enterprise Group will be gone before the split-up takes place.
Bill Veghte will split the HP scene, leaving "later this summer to pursue a new opportunity." Big vendors like HP rarely track where an exec like Veghte is heading next. It's not in the same direction as the business that makes Integrity servers, the HP-UX operating environment, or the competitive mass storage product lines that some migrators have invested in.
He's been leading the efforts to separate the consumer printer PC side of HP from its Enterprise sibling, a sort of cleaving of what's become a Siamese twin of business at the vendor. It's been a project underway since last fall, employing Veghte after COO work. This is not the kind of announcement you want to release before a massive split is completed. HP's original estimate for revenues of HP Enterprise was $58.4 billion, larger than the PC-printer side.
There have been exits from a seat this high before at HP. Dave Donatelli left the company, and now has landed at arch-rival Oracle. From a tactical perspective, or at least not quite as customer-facing, HP's got to clone 2,600 internal IT systems, extracting and separating the data inside. It's the opposite effort of a merger, with no safety net. The Wall Street Journal says the IT enterprise split could stall the split-up of the company, if the project doesn't go well.It's not all glum forecasting among the enterprise industry analysts, though. One report from banking firm Raymond James says the divided HP could purchase its longtime rival EMC. "We continue to believe that an acquisition of EMC by HP is more than a distinct possibility, as HP strives to increase shareholder value following its tax-free spinoff in November, while EMC deals with a high-profile shareholder activist," the report says.
Donatelli was an EMC kingpin before he arrived at HP, a move that EMC sued over during Donatelli's earliest HP months. The EMC scheme didn't have traction anyplace but the Raymond James report. But HP and EMC have tried to merge before, with almost a year of discussions that petered out last fall. HP announced its split-up plans in the same timeframe.
HP's stock dipped below $30 a share today, and it's down about 12 percent over the past month.
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June 04, 2015
More open HP shares its source experience
It's not fair to Hewlett-Packard to portray its Discover meeting this week as just another exercise in putting dreams of industry-rocking memristor computing to rest. The company also shared the source code for one of its products with the world, a tool the vendor has used itself in a profitable software product.
HP’s Chief Technology Officer Martin Fink, who also heads up HP Labs, announced the release of Grommet, HP’s own internal-use advanced open source app. The platform will be completely open source, licensed for open use in creating apps' user experience, or UX as it's known in developer circles. Fink said Grommet was HP’s contribution to the IT industry and the open source community.
HP says "Grommet easily and efficiently scales your project with one code base, from phones to desktops, and everything in between." The vendor has been using it to develop its system management software HP OneView for more than three years. The code on GitHub and a style guide help create apps with consumer interfaces, so there's a uniform user experience for internal apps. Application icons like the one on the left are available from an interface template at an HP website.
The gift of HP's software R&D to a community of users is a wide improvement over the strategy in the year that followed an exit announcement from MPE/iX futures. A campaign to win an MPE/iX open source license, like the Creative Commons 4.0 license for Grommet, came to naught within three years of that HP notification. There were some differences, such as the fact that HP still was selling MPE/iX through October of 2003, and it was collecting support money for the environment as well.
The 3000 community wanted to take MPE/iX into open source status, and that's why its advocacy group was named OpenMPE. It took eight more years, but HP did help in a modest way to preserve the maintainability of MPE/iX. The vendor sold source code licenses for $10,000 each to support companies. These were limited licenses, and they remain a vestige of what HP might have done -- a move not only echoed by Grommet, but reflected in HP's plan to move OpenVMS to a third party.
"I guess there is a difference between licensing the MPE code and then distributing it," our prolific commenter Tim O'Neill said last week.
I have heard that HP hangs onto the distribution rights because they are afraid of liability. Surely they do not, at this point, still seek to make money off it, do they? Is there some secret desire within HP to once again market it?
It feels safe to say not a bit of desire exists in HP today, even though Grommet shows the vendor can be generous with more mainstream tech. In at least one case, HP's offer of help with MPE's future was proactive, if not that generous.Steve Suraci of Pivital Solutions tells a story about that MPE/iX source license. He was called by Alvina Nishimoto of HP in 2009 and asked, "You want to purchase one of these, don't you?" The answer was yes. Nobody knew what good a source code license might do in the after-market. But HP was not likely to make the licensing offer twice, and the companies who got one took on that $10,000 expense as an investment in support operations.
Pining over Grommet or the sweeter disposition of OpenVMS won't change much in the strategy of owning or migrating from MPE/iX. Open source has become a mainstream enterprise IT scheme by 2015, pumped up by the Linux success story. O'Neill said he still believes an open source MPE/iX would be a Linux alternative. He reported he recently discovered the Posix interface in MPE/iX. Posix was supposed to be a way to give MPE the ability to run Unix applications, using 1990 thinking.
The aim for Posix was widely misunderstood. It was essential to an MPE/iX user experience that didn't materialize as HP hoped. But John Burke, our net.digest and Hidden Value editor for many years, noted in the weeks after that exit announcement that HP's training on Posix expressed that desire of bringing the Unix apps to the 3000.
The following is an example from HP training:
"Before we proceed, let's stop to ask a question, just to ensure you've got the fundamental idea. Which of the following statements best summarizes the reason why HP has brought POSIX compliant interfaces to the MPE/iX operating system and the HP3000?
- POSIX is the first step in HP's plan to move all HP3000 users to UNIX
- POSIX is a tool that HP is using to bring new applications to MPE from the UNIX environment.
- POSIX is a piece of software that HP is using to eventually combine the HP3000 and the HP9000 into a single system.
Choose the best answer, and press the corresponding key: ‘1’, ‘2’ or ‘3’."
June 03, 2015
HP's Machine dream migrates off OS plan
The HP Discover show has wrapped up its second day, an annual event full of sales and engineering staff from the vendor as well as high-line customers. The show included an introduction of the new logo for the Enterprise half of Hewlett-Packard, a spinoff the vendor will cleave off the company in October. It's an empty green rectangle, something that drew some scorn an an icon bereft of content or message.
CEO Meg Whitman said the green represents growth and the rectangle is a window on the future. We can only hope that a logo for a $65 billion corporation that turns out to be a rectangle in green has a good discount attached to the project's invoice.
But another session today that can be consumed on Livestream.com showed a consistent removal of substance from HP's dream factory. The Machine, a project that reportedly was attracting more than half the R&D budget for the full corporation, had its mission backed away from the platform that promised to lead into computing's future. A computer built around the long-pursued memristor will make a debut sometime next year, but bearing standard DRAM chips instead. Of greatest interest to HP 3000 customers, former and those still current, is abandoning the R&D to create a Machine operating system.
An OS for the Machine would have been HP's first such project since MPE. HP hasn't built an environment from scratch since MPE was introduced in the 1970s. Its Unix began in Bell Labs with System V, NonStop was created at Tandem, and VMS was the brainchild of DEC. The Palm OS came from the company of the same name, and HP sold that software to Samsung to be used in refrigerators. HP's head of Labs Martin Fink said that Linux will be the software heartbeat of the Machine going forward. Creating a computer that runs Linux: Nothing there to suggest there's new love for software R&D in Fink's labs.Fink told the New York Times regarding the Machine that "Big will happen first, small will happen later." He was talking about the scale for the Machine, at first being a 320TB RAM device before becoming sized for smartphones and printers.
Big has developed a way of happening later at HP, not first.
The most telling part of this retrench of this big idea: falling back to a customized Linux as the operating environment for the Machine. Operating systems are big, but HP's not going to force software developers to learn something that has a chance to change the world's computing, as proposed for the Machine last year.
In the main hall of the Las Vegas show, thousands of customers and HP employees watched a clip from Avatar as evidence of HP's ambitions during today's talk. When the clip ended, the hall was silent. "You can clap for that, c'mon," Whitman said. She announced three sequels to come, called the movie a franchise, and adding that HP Enterprise has a five-year partnership with the creators of Avatar. HP's goal is create a rich user experience for the science fiction of James Cameron's films.
Science fiction about computer science might be for sale before the first sequel airs in 2017. HP's keynoted Discover content is all available on Livestream this year, for the first time. Tomorrow is the final day for the event.
May 21, 2015
HP disses synergies as Q2 flows downhill
Penetration rates increased for HP's Business Critical Systems in the company's second quarter of 2015, year over year. And the corporation that sold thousands of HP-UX systems from that BCS to HP 3000 migrators reported that it has spent more than $400 million in dis-synergies in the just-finished quarter. Such were the milestones of financial jargon delivered to explain Q2 business. On the strength of profits that met expectations, analysts said the last 90 days of business didn't sink the SS Hewlett-Packard any further.
But the $25.5 billion in sales dropped from last year's Q2, and the revenues fell from the previous quarter as well. HP is selling less -- especially in the enterprise servers it created like Integrity -- and its already spending hundreds of millions to split itself into Enterprise and PC-printer companies. Halfway through the final year when all of that business is under one corporate banner, the company is looking ahead to rising reports as a split-up entity.
"HP is becoming stronger as we head into the second half of our fiscal year and separation in November," said CEO Meg Whitman at this afternoon's analyst briefing. The stock had closed at $33.83 and rose about 40 cents a share in after-hours trading.
The strength of the company, a subject of interest only to the 3000 customers who've chosen HP for migrations, must be measured in more than the price of its stock. HP hopes so, at least, since HPQ is trading in the same middle $30 range of 2011. Whitman has held her job since then, a time when PC pursuits and big-ticket acquisitions were the order of the day.
Now HP is merging with a new sense of focus. Merger and acquisition plays have both negative and positive prospects. Savings come through synergies. Declines come through dis-synergies, something HP wrote off as restructuring and separations costs that totalled more than a half-billion dollars.Revenues flowed downhill in all HP segments tied to systems and devices: PCs, printers, and HP-built enterprise servers. Industry Standard Servers sales rose, and HP is looking forward to the migration of customers from Windows 2003 to 2012 to lift sales of Intel-based products. The sales in Business Critical Systems declined another 15 percent versus Q2 of 2014. Year over year declines in BCS have arrived in steady measure for the last four years. But the Enterprise Group where BCS lives -- a unit that'll be a part of this fall's newly-minted HP Enterprise Corp. -- reported just a $7 million drop in profits. Sales were off $84 million.
Business Critical Systems sales -- all of the revenues from HP-UX, OpenVMS, and NonStop servers, plus allied software -- dropped below $200 million for the first time in Q2. "The team delivered growth in operating profit dollars," said CFO Cathie Lesjak, "by improved gross margin and operating expense management." Selling and working out of BCS is a cost-wary enterprise in 2015.
Superdome X and NonStop X are a pair of server projects that will take those platforms across the HP-built to industry standard divide, and HP says those prospects hold hope for the future of those systems.
The price of a better future for a divided HP is those dis-synergies. One definition of this business term:
- Lower employee productivity during a period of due diligence or arising from the uncertainty of the takeover
- Loss of key employees to competitors
- Underestimating the time and complexity of merger integration, particularly integrating different systems
- Loss of customers who may decide that they wish to reduce the total amount they spend with the two businesses once combined or (worse) switch to a different supplier altogether.
In HP's case, that merger is the classic-line Hewlett-Packard business, enterprise computing, with the realities of competing in 2016 and beyond.
May 20, 2015
Discovering HP's Futures
In a couple of weeks HP computer users will gather for an annual conference in North America. For the past five years, the meeting has been called HP Discover. This year's event is promising to show off visions of the future. Pictures of stalwart enterprise community members will be harder to find.
Among the HP technologies developed as computing environments, only HP's Unix will have a Special Interest Group Forum at the June 2-4 conference. Searching the sessions database for the letters VMS -- pretty special to the Digital customers that HP preferred to serve futures to versus 3000 sites -- yields no hits. If VMS is being discussed at HP Discover, it's likely to be just a topic on the floor.
Stromasys will be on that floor, talking about several platforms whose HP futures have already or will soon enough expire. Charon HPA, emulating the HP 3000 hardware, as well as virtualization products for the Digital systems and even Sun's Solaris computers will be demonstrated. Sarah Smith of Stromasys says it's a regular stop in the company's itinerary.
"At the booth we'll be doing demos of Charon," she said. "We've been going for years. VAX, Alpha, and PDP were all DEC products, so we talk about all of them at Discover."
Meanwhile, HP will be talking about many commodity solutions along with The Machine, its project to deliver six times more power than current computer systems on 1.25 percent of the energy. Its big idea is universal memory, driven by the elusive memristor HP first began discussing in 2008. Universal memory is as inexpensive as DRAM, as speedy as static RAM, as non-volatile as flash memory, and infinitely durable. The Machine is an HP Labs project reputed to have requisitioned 75 percent of the Labs' resources. Its delivery date is far enough out in the future that hearing about its potential is still just about all anybody expects this year, or next.The HP North American shows were once all about users, and then after awhile, all about the products the vendor had delivered and were in use in the field. The HP 3000 slipped out of the session list at HP Discover around 2010, and now the VMS platform hasn't qualified for as much time as The Machine. The conference does gather a nice sheaf of customers to go along with a thicket of HP staff. Even before the show was renamed from the HP Tech Forum, it had tilted toward sales-to-customer events with more than a few NDAs to keep out the riff-raff.
HP Innovation Brought to Life in Film will tell attendees they can "Get a glimpse into some of the revolutionary technologies HP is tackling that address the most complex challenges and opportunities for our customers and our society in the next decade and beyond." There's not much point in setting out session times for an hour on something like improving performance of an HP-specific database, because by now such a thing has dropped off HP's discovery map. That's 20th Century computing, anyway.
But despite the habit of eschewing topics like VMS, MPE, and other HP legacy creations, the company hasn't lost its taste for invention altogether. A panel of HP Labs researchers will offer "a closer look at what it takes to make The Machine change everything we know about computing. This radical new approach will fuse memory and storage, flatten data hierarchies, bring processing closer to data, embed security throughout the hardware and software stacks and enable management of the system at scale."
There was a time when HP's chalk talk about such a product would only have emerged when the product shipped, or at least was priced. When the first HP 3000 Spectrum systems -- the PA-RISC emulated by Charon -- slipped into release, the HP Journal ran tech articles on how they were breaking ground. Aiming at a high bar like "changing everything we know about computing" sounds a lot like a concept film of the 1980s or 1990s HP. Great fun, but perhaps not as immediately useful as the networking within a SIG Forum. At least HP-UX still has that much to count upon in two weeks' time.
February 27, 2015
Dow hits record while HP shares fall out
On the day the Dow Jones Industrial Average reached a record pinnacle, Hewlett-Packard released quarterly results that pushed the company's stock down 10 percent.
HP is no longer in the Dow, a revision that the New York Stock Exchange made last year. HP is revising its organization this year in preparing to split in two by October. The numbers from HP's Q1 of 2015 indicate the split can't happen soon enough for the maker of servers targeted to replace HP 3000s. The company is marching toward a future more focused on enterprise systems -- but like a trooper on a hard course, HP fell out during the last 90 days.
HP said that the weakness in the US Dollar accounted for its overall 5 percent drop in sales compared to last year's first quarter. Sales would have only fallen 2 percent on a constant-currency basis, the company said. It mentioned the word "currency" 55 times in just its prepared marks of an earnings conference call this week. The 26.8 billion in sales were off by $1.3 billion on the quarter, a period where HP managed to post $1.7 billion in pre-tax earnings.
That $1.7 billion is a far cry from Apple's $18 billion in its latest quarter profits. HP's arch-rival IBM is partnering with Apple on enterprise-caliber deals.
Meanwhile, the still-combined Hewlett-Packard has rolled from stalled to declining over the last 18 months, which represents some of the reason for its bold move to split itself. "Enterprise trends are set to remain lackluster absent a transformative acquisition," said one analyst while speaking to MarketWatch this week. Two-thirds of the $5.5 billion in Printing came from supplies. Ink is still king in the printing group
Industry Standard Systems (Intel-based Windows servers) provided the lone uptick in the report. Sales of products such as the newest Gen9 ProLiants lifted the revenues up 7 percent compared to the Q1 of 2014. HP is ready to take advantage of upcoming rollovers in Windows Server installations.Results from the Enterprise Group delivered another chorus of downbeat numbers for the Business Critical Systems operations. The group where HP's Unix and VMS enterprise servers are created saw its sales fall 9 percent from last year's Q1. Of course, that period showed a revenue drop as well. BCS operations -- where the HP 3000 resided when it was a Hewlett-Packard product -- haven't seen any recovery in more than two years.
BCS results have been so consistently poor that HP considered that 9 percent drop a good sign. "We also saw some recovery in business-critical systems," said CFO Cathie Lesjak, "with revenue down only 7 percent in constant currency or 9 percent as reported."
Lesjak pointed out to the analysts on its conference call that hardware such as the Integrity HP-UX servers are vulnerable to the value of the US Dollar.
Our personal systems and our Enterprise Group hardware businesses have very little in natural hedges, as our component contracts are typically in US dollars. As a result, these businesses are disproportionately impacted by currency movements. However, we do have some ability to increase pricing in response to currency movements, while being mindful of competition and potential negative impacts to customer demand.
HP is expecting all of the 2015 hardware growth in the Enterprise Group to come from its Gen9 lineup of ProLiant systems. Windows Server 2003 has an expiration date for its support coming up in July, an event that HP believes will give it some fresh wind in its enterprise sales.
"I think we are really well positioned to take advantage of Windows 2003 refresh, just as we were from the XP migration and the PC business," said CEO Meg Whitman. "I think we feel really pretty good about that business for the reminder of the year. And I think we are very well positioned .and the Gen9 server was dead-on, from the market perspective."
February 12, 2015
TBT: Sure, there's 20 more years of the 3000
Just 22 years ago this month, the leader of the HP 3000 division figured HP would still be selling and supporting HP 3000s working in businesses today. Glenn Osaka was in his first few months running what HP called CSY, a group that was coming up hard against HP's own Unix sales force.
"I think there's another 20 years in it," he said in 1993, "but I can tell you that 20 years from now, we'll probably look back and the 3000 won't be looking at all like it looks today."
Nobody could see a virtualized server looking like HP's proprietary hardware. PA-RISC computing was just becoming dominant. In 1993 there was no serious emulation in enterprise servers, let alone virtualization. The magic of Charon had not even dawned for the Digital servers where the Stromasys product notched its first success.
But HP was thinking big in that February. Osaka said the 3000 was about to take on "applications that traditionally would have been thought of as IBM mainframe-class applications. That program is going gangbusters for us. To get that new business on the high end of the product line is very effective for us, because it's the most profitable business we can do. More and more of our new business is going to come from people who are coming from mainframes."
The division was posting annual growth of 5-10 percent, which might have been impressive until HP compared it to 40 percent annual growth in its Unix line.
In a year when HP was just introducing a Unix-like Posix interface to MPE, Osaka said HP's "work that we're doing on Unix is very easily leveraged to the 3000, and we're simply using our sales force to help us find the opportunities to bring it to market first."
He identified the newest generation of the 3000's database as "SQL for IMAGE," something that would help with relationships with partners like Cognos, Gupta Technologies, PowerSoft and more. What HP would call IMAGE/SQL "will give our customers access to these partners' tools without having to change their database management system." A new client-server solutions program was afoot at HP, and the 3000 was being included on a later schedule than the HP 9000 Unix servers.
The server would "carve itself a nice, comfortable niche in some of the spaces we don't even really conceive of today, particularly in transaction-based processing." Osaka would hold the job until 1995, when he'd become the head of the Computer Systems Business Unit at HP. By that time, he'd guessed, HP would still be able to show its customers that "the level of capability that we provide on the 3000 is higher" than HP Unix servers.By the time we interviewed Osaka three years later, in a new post in 1996, he'd dialed back his forecast to say "we have at least 10 more years of very strong presence in large companies and medium sized companies with the 3000 in the marketplace. What I don't know is what people are going to buy. For a long time I have had as a core belief that the life of any computer is tied to the lifespan of the application."
But by 1996, with his unit containing both Unix and MPE divisions, Osaka was giving us at the NewsWire the first notes of warning that things had changed for the server inside HP. In our September 1996 Q&A, he said new applications ought to be launched on other platforms.
The whole dynamics around the application software industry have changed. Because of Microsoft, it's turning into a volume marketplace, and there's not enough volume in the 3000 business to fuel the early growth of such companies. If I were a developer, depending on what kind of application, I'd say put it on Oracle, or Informix, or NT BackOffice. Then I'd feel more comfortable I'd get a return.
You're making us glad we didn't ask you about the NewsWire's chances when we started.The NewsWire is an interesting thing. Information that is critical to this user community has high value, because HP has become less effective at delivering that information to the broad user base. That's a viable business plan, but there are others [in this market] that people talk to me about that don't quite make so much sense.
We left that interview feeling lucky to have pushed out our first year of a publication that was doing what HP couldn't do so well anymore. We'd also be facing the hard reality, within five years, that HP couldn't manage a belief in any future role for the server beyond 2006.
Osaka left HP within two years of our second interview, moving on eventually to Juniper Networks and other high-tech firms. Today he's a private consultant and advisor. Of his work in the 3000 division, MB Foster's Birket Foster says on Linked In
Glenn provided leadership and "out-of-the-box" thinking when running the CSY division. Glenn saw value in the software vendor community, completing solutions for mutual customers. Glenn assisted the formalization of the SIG SoftVend meetings, to exchange directions with software vendors and facilitated non-disclosure meetings for access to MPE source, and working with tool/utility software vendors.
February 05, 2015
Getting Chromed, and Bad Calls
The HP 3000 made its bones against IBM's business computers, and the wires are alive this week with the fortunes of Big Blue circa 2015. Starting with meetings yesterday, the company is conducting a Resource Action, its euphemism for layoffs. IBM employees call these RAs, but this year's edition is so special -- and perhaps so deep -- it's got a project name. The cutting is dubbed Project Chrome, and so the IBM'ers call getting laid off Getting Chromed.
Hewlett-Packard has never wanted to call its layoffs by their real name either. The first major HP layoff action during the 3000's watch came in the fall of 1989, when more than 800 of these separations were called "being excessed." Employees had four months to find a new place inside HP, but had to search on their own time. Engineers and support staff were given the option to remain at the company, but jobs at plant guard shacks were among their new career options. Another virulent strain of HP pink slips came in the middle of the last decade, one of the purges in pursuit of better Earnings Per Share that pared away much of the remaining MPE/iX expertise from the vendor.
Aside from bad quarterly reports, these unemployment actions sometimes come in the aftermath of ill-fated corporate acquisitions. This week on CNBC's Squawk Box, analysts identified HP's Compaq merger as one of the worst calls of all time. The subject surfaced after the questionable call that led to a Seattle defeat in Sunday's SuperBowl. A big company's failures in new markets can also be to blame for getting Chromed. IBM has seen its revenues and profits fall over the last year, while mobile and cloud competitors have out-maneuvered Big Blue.
IBM has already shucked off the Cognos development tool PowerHouse as of early last year, but now comes word that other non-IBM software is getting its support pared back in the RA. In the IEEE's digital edition of Spectrum, one commenter made a case for how IBM is sorting out what's getting Chromed.
The digital article on the IEEE website also includes some reports that employees over 40 have been targeted. They then saw the company threaten to withhold severance packages if age-discrimination lawsuits were filed.
I am the last US resource supporting a non-IBM software package, which is in high demand globally -- yet the powers that be seem oblivious to it. Rather than create a dedicated group to go after that business, they cut anyone with that skill, since it is not an IBM product and therefore, "not strategic." Unfortunately the company continues to gamble on their Tivoli products, which clients seem to embrace about as much as Lotus Notes, rabies and bird flu.
HP and IBM have a lot in common in their workforce makeup. Both employ more than 300,000 workers as of last year, and while those numbers lead the industry, neither is among the top 15 employers worldwide in headcount. However, HP and IBM manufacture goods, so they look up at the largest manufacturing worker employer, Volkwagen. There are 555,000 VW employees.
HP's employee count rose into six digits, and then doubled again, as a result of two acquisitions. Compaq drove the headcount to above 140,000, a 65 percent increase. Then in 2008, EDS became an HP operation, and the headcount soared to 349,000. Since 2011, the workforce at the vendor that's still working to sell some HP 3000 replacements has dropped by 15 percent. The current HP layoff plan — a layoff strategy has been in place for more than five year — calls for a total of 55,000 job eliminations by the end of this fiscal year.
These employee cuts are the result of relentless pursuit of EPS growth, so that the numbers reported to shareholders can show an increase in spite of flat to falling revenues. Stock prices at HP have recovered to 2005 levels amid the HP layoff march. But IBM's share price took a 12 percent dive on a single day this fall, is now below its mark when current CEO Ginni Rommety took over, and hovers today around $160 a share.
Rommety was rewarded for her performance in 2014 with a $1.6 million bonus. The tepid stock of IBM made it "the worst performer in the Dow Jones Industrial Average for a second straight year," according to Bloomberg News. The company that once proudly wore the reputation "nobody ever got fired for buying IBM" is doing a lot of firing this week.
February 02, 2015
HP's new roster: same minds, old mission
HP has announced its new management lineup for the split company, but many key positions for the refocused Hewlett-Packard Enterprise won't change in the reorganization. Hewlett-Packard Enterprise is the name for the corporation that will sell, support and even develop the HP suggested replacements for the HP 3000. Customers who invested in HP's Unix servers, or even those using HP's ProLiants as Linux hosts, will care about who's leading that new company.
But those customers won't have to spend a great deal of time tracking new faces. Current HP CEO Meg Whitman will head the company that promises to increase its focus on enterprise computing, the kind that HP 3000s have done for decades. While reading the tea leaves and doing the Kremlinology for the heads of HP computer operations, the following leaders are unchanged:
- Cathie Lesjak will be the Chief Financial Officer
- John Schultz will be the General Counsel
- Henry Gomez will be the Chief Marketing and Communications Officer
- John Hinshaw will be the Chief Customer Officer and lead Technology & Operations
- Martin Fink will be the Chief Technology Officer and lead Hewlett-Packard Labs
While remaining as the General Manager of Enterprise Group, Bill Veghte will lead the Hewlett-Packard Enterprise separation efforts. He's not doing a small job now. The Enterprise group is a $28 billion annual revenue business that includes server, storage, networking, technology services, and cloud solutions. Giving him transition duties is reminiscent of the days when leading the HP 3000 operations as GM had devolved into a part-time job, shared with the GM duties of HP's Business Intelligence Unit. It's different this time; there's a second-in-command who'll manage the Enterprise Group operations in this year of transition.
With HP's Labs, Enterprise chiefs, and the head of the boardroom table all the same, it will be interesting to see what changes get managed with the old team. HP will have an old mission, too -- very old, from the era before it heard the siren song of consumer computing. 3000 customers used to wish for an HP that was marketing-savvy. When that HP arrived, it seemed to quickly forget the 3000. There was a renaissance in the 3000 thinking and plans from Roy Breslawski in marketing, and Harry Sterling as GM. But Sterling was then handed Business Intelligence GM duties alongside his 3000 mission. Within a couple of years after Sterling retired, the 3000 was out on the chopping block.
Nobody knows what will be excised from the Hewlett-Packard Enterprise that's going to have to get even leaner as a smaller entity. But at least that Enterprise won't be spending a lot to lure new executives with fat recruiting packages like the one given to Mark Hurd. That was at the peak of the consumer pursuit at HP. Some might call it the nadir, from an enterprise computing perspective.
January 16, 2015
What's ahead for the HPs of 2015?
Last year Hewlett-Packard announced it's going to split up in 2015. Right now it's a combined entity whose stock (HPQ) represents both PC and enterprise business. But by the end of this fiscal year, it will be two companies, one called HP Inc. and another holding the classic Hewlett-Packard name. Any of the enterprise business that HP's managed to migrate from 3000s sits in that Hewlett-Packard future.
Most of time, the things that HP has done to affect your world have been easy to see coming. There's a big exception we all know about from November of 2001. But even the forthcoming split-up of the company was advocated for years by Wall Street analysts. It was a matter of when, some said, not if.
If can be a big word, considering it has just two letters. There was an HP ad campaign from 30 years ago that was themed What If. In things like TV commercials that included shots of HP 3000 terminals, What If sometimes proposed more radical things for its day, like a seamless integration of enterprise mail with the then-nouveau desktop computers.
HP called that NewWave, and by the time it rolled out the product looked a lot like a me-too of Apple and Microsoft interfaces. But What If, rolled forward to 2015, would be genuinely radical if there were either no HP left any more, or Hewlett-Packard leveraged mergers with competitors.
What If: HP's PC and printer business was purchased by Lenovo, a chief competitor in the laptop-desktop arena? Its new CEO of the HP Inc spinoff ran Lenovo before joining HP. On the other hand, what if HP bought Lenovo?
What If: Hewlett-Packard Enterprise became a property of Oracle? That one is a much bigger If, considering that HP's built hardware in massive quantity for a decade-plus along four different product lines: Integrity, PA-RISC (still generating support revenues in HP-UX), ProLiant x86s, and its dizzying array of networking products. You could even label forthcoming dreams like The Machine, or the Moonshot systems, as hardware lines. Oracle's got just Sun systems. As 3000 customers know, hardware is not a firm stake in the ground for business futures.If there's anything that seems certain here in January, it's that the creator of MPE, IMAGE and PA-RISC will continue to pursue enterprise business customers of its competitors. The customers of firms like IBM and Oracle (Sun) are just about all that can be nabbed by a purveyor of enterprise environments that are proprietary — the lame-duck VMS, the NonStop OS, and HP-UX.
The computer industry hasn't had an earthquake of a deal that'd register Oracle+HP tremors since HP bought EDS in 2008 for $13.9 billion. HP bought Compaq in 2002 for $25 billion. That's a lot of simoleons in a computing market that's growing. Dollar-wise, Oracle acquiring HP would've been 40 percent cheaper one year ago. HP's market capitalization today is $70 billion, and it was just $50 billion in January 2014.
That is, of course, the size of the un-divided HP. Hewlett-Packard Enterprise will be valued at half that. But if you could acquire the entire HP at $50 billion one year ago, and in 2015 that money would only buy half the company — and the part that's growing much more slowly — why do it when it costs more?
Oracle is more than twice the size of HP, though, in market capitalization. Right now Oracle is at $189 billion in market cap. Nobody learns about deals of this size between titans like these until the agreement is right under our noses. Everybody's got to convince their shareholders, too. An epic battle was waged over HP's Compaq purchase over just that circumstance. We can't tell, but your community also knows that kind of surprise is also true about lopping off business product lines — ones that are profitable and beloved, too.
December 22, 2014
A Quiet December Week's MPE Ripples
The week of Christmas is a quiet one for business and enterprise IT. Sales calls and installations are at a minimum, companies work with skeleton crews, and announcements of news are rare. But nine years ago the week of Christmas was hot with a 3000 development, one that has ripples even today.
In the Christmas week of 2005 — back when HP still worked full shifts over the holidays — the 3000 division released news that HP's support lifespan for MPE would be extended. What had been called a firm and solid date of HP's departure got moved another 24 months into the future. The news was the first unmistakable evidence that the migration forecast from HP was more wishful than accurate.
As it said it would offer basic reactive support services for 3000 systems through at least December of 2008, the vendor confirmed that it would license MPE source code to several third parties. The former put a chill on migration business in the market, sending vendors -- services and software suppliers alike -- looking for non-3000 markets to service. The latter gave the support community a shot of fresh competition over the afterlife beyond the Hewlett-Packard exit.
In one of the more mixed messages to the community, HP said customers should work with the vendor to arrange support until migrations could be finished. The 3000 division also said its license for MPE source was going to "help partners meet the basic support needs of the remaining e3000 customers and partners." It would take another three years, beyond the closing of the MPE lab, for that source code to emerge.
The source license was limited to read-only informational use, mostly to write patches. The extension of HP's profitable support business put a kink in both migration partners' business as well as the very third party support partners the source was supposed to help.
Officially, the word from HP was that "We see that most HP e3000 customers are moving to new HP solutions, and are working closely with HP and our partners during their transitions." But Windows was moving into the spot that HP swept clean by announcing an MPE exit. An extra two years to make a migration didn't bring more ex-3000 shops into HP environments, unless they were running Windows on HP hardware.
At that time, we reported that the extension of HP's support for the 3000 -- a rollback of the "end of life" as the vendor called its exit — had already been on offer for the biggest 3000 customers.
MB Foster, a North American Platinum migration partner, said the offer of extra support was "one of the worst-kept secrets in the marketplace," according to founder Birket Foster. The extension of HP support doesn't change the business model at Speedware, or MB Foster, according to their officials. But offering basic level reactive support won't meet some customers' needs, Foster added.
While some customers will welcome the potential for more time to migrate, Foster said the HP announcement is introducing some confusion among others. "We had a customer who looked at this and said it would not be enough to make them supportable — but their senior management felt they could take the extra time," Foster said.
The offer has ripples to this day because the migration partners heard the screeching of brakes all through the market on projects. Billings evaporated that would have helped companies still supporting MPE software. It would take another seven years for the migrations to dwindle enough that Speedware announced it was reorganizing as Fresche Legacy, and start embracing transformations for the IBM AS/400 market.
As for the impact on support of 3000s, HP was suggesting that third parties could be part of an HP-branded support offering.
HP it still considers third parties to be a potential part of its own service supply chain for the HP 3000. For the moment, however, the HP support customers get will come from an HP employee or contractor. Third party support actually now takes a step up in a comparison with the just-announced 2007-08 levels of service. Most companies offering support won’t charge as much as HP to deliver mission-critical support.
Third parties never became part of HP's support products. These independent companies found that HP wouldn't leave the field when its clock was supposed to run out. The vendor chose a next-to-Christmas announcement date to de-emphasize its moving of the goalposts.
As for the relative silence from the customer community, it might be the result of making an announcement three days before the Christmas holiday weekend. As for the business planning of the 3000 sites’ budgets, next year's 2006 is already spoken for. All this does is change options for 2007.
It’s too bad this announcement didn’t come when more people were listening, still able to allocate budgets. But HP did more than its last two updates to OpenMPE's requests. In those instances, responses came in the form of postings to mailing lists. This time out there was PR support, and an outreach to business analysts and the mainstream IT press. You’d think the vendor had something to sell here, like goodwill in a holiday season — or another couple of years of support.
December 01, 2014
HP Q4, FY static; 3000 replacement sales fall
Despite all of the challenges Hewlett-Packard faced over the past fiscal year, the company has reported sales and earnings that didn't fall much from FY 2013 levels. Falling sales of HP 3000 replacement systems remain on the balance sheet, however. Nothing has changed but the depth of the plunge.
Both the 2014 fiscal year and the Q4 numbers (click on graphics for details) reflected an ability to keep some declines off the HP financial report. The latest quarter improved on Q2 and Q3 results overall. HP reported a profit of $2.62 per share for 2014. That's nearly $5 billion in earnings company-wide.
If the company sticks to its plan, its total of $115 billion in 2014 sales, only down 1 percent from last year, covers the penultimate period HP reports as a full company. By the end of FY 2015, the corporation will separate its businesses and spin off HP, Inc. for consumer and PC products. Hewlett-Packard will remain to sell servers and enterprise computing products and services. Analysts expect the companies to be of equal size.
The total of HP's Business Critical Systems revenues took another hit in the fourth quarter, dropping almost 30 percent from Q4 of 2013. Double-digit percentage drops in BCS sales are commonplace by now. The unit produces the HP-UX systems HP once designated as replacements for the HP 3000. Intel-based systems, contained in the Industry Standard Servers operations, also saw their sales decline slightly. Networking revenues were slightly higher for the quarter.
The company's CEO was thrilled about the overall picture for the full company, calling it a sustained turnaround.
"I'm excited to say that HP's turnaround continues on track," said Meg Whitman. "In FY14, we stabilized our revenue trajectory, strengthened our operations, showed strong financial discipline, and once again made innovation the cornerstone of our company. Our product roadmaps are the best they've been in years and our partners and customers believe in us. There's still a lot left to do, but our efforts to date, combined with the separation we announced in October, sets the stage for accelerated progress in FY15 and beyond."The HP Enterprise Group, where BCS operations live, saw revenues drop 4 percent year over year with a 14.8 percent operating margin. Industry Standard Servers revenue was down 2 percent, Storage revenue was down 8 percent, Business Critical Systems revenue was down 29 percent, Networking revenue was up 2 percent and Technology Services revenue was down 3 percent. After the report, HP's share price flirted with the $40 mark and hit a 52-week high, before falling away today. The fate of BCS and the Enterprise Group didn't concern many investors, who watch EPS profits versus predictions.
The BCS numbers for the full year showed a 22 percent sales decline, a figure that reflects a total of perhaps $200 million in lost revenues. HP doesn't report individual segment sales totals from its Enterprise Group. But BCS operations accounted for about 3 percent of the Enterprise group's $27.8 billion of activity. BCS did avoid a quarterly revenue decline once during 2014. This latest period countered with the largest quarter-over-quarter sales dive for BCS, up to now.
Even though four of the five HP segments reported revenue declines -- and the fifth, Printing and Personal systems, was flat -- the company continues to post profits. The Enterprise Group managed to return the largest operating profit for Q4 of 2014, even while its sales declined. Profitability from these Enterprise products and services will buoy up the forthcoming HP Enterprise corporation. Only HP Printing, the keystone of the new HP Inc., is more profitable per dollar of revenue.
BCS 3000 replacements won't be providing as much profit during the forthcoming year. But HP predicts that its total, company-wide operations for 2015's fiscal year will net $6 billion in profits. Those are numbers for the combined company -- one which, by this time next year, will operate as two entities.
November 26, 2014
Something to give thanks for, and envy, too
On the eve of a holiday invented to promote thanks as well as outsized eating, Thanksgiving reminds us of what a 3000 user can thank the gods for -- and something to envy, too.
Prolific commenter Tim O'Neill asked, "Can you write about the current futures of other no-longer-supported systems such as HP 1000, Alpha, and old HP 9000s such as Series 300/400/700?" We can write that the HP 1000, a product line which HP turned off just after Y2K, still has third parties who will maintain and support RTE operating system applications. The HP 1000 got a proper emulator from Strobe Data, engineered in time to capture the business of companies who couldn't part with RTE apps.
A similar story is true of the AlphaServer line from HP. Killed off in the last decade, Alpha is a third-party supported product. No other Alpha computers were built after HP shunted its users to the Integrity line, a migration path of dubious future by now. Alpha has a good emulator in the AXP version of Charon from Stromasys, the company providing a future for long-serving MPE/iX apps, too. The presence of Charon prompts thanks from companies who can't support the concept of decade-old HP hardware running MPE/iX.
But while the Alpha and the 3000 will live on in the virtualization of Stromasys, they can be envious of the deal another retiring environment received this year. OpenVMS will live on in an exclusive license to VMS Software Inc. (VSI). The company got the arrangement to carry OpenVMS forward with new versions using the HP source code for the operating system.
The details released haven't yielded much more than a third-party road map for the OS, up to now. But that's a future with some tantalizing what-if's, both for the OS and for the 3000 user who wanted more MPE/iX future back in 2002. OpenMPE campaigned for use of HP's source code for MPE and got an arrangement that was announced six years ago this week. That source was limited to a technical support resource, however.
If, as happened with OpenVMS, that source had been promised to a single third party, six years before HP would drop support, there could be more to be thankful for this week. Extended third party applications. Support for newer technologies. A replacement vendor, blessed by HP, to mention in boardroom meetings about the 3000's future.
Perhaps OpenVMS customers should be thankful for something else, too: The lessons HP faced about ending the life of a business operating environment, an OS that brought HP to the computing game. Third parties that love and care for a legacy computer were on hand for the 3000. They fell short of convincing Hewlett-Packard to turn over a marketplace. Maybe HP learned that leaving customers with no better choice than replacing a system with Windows wasn't great business.
We'll give thanks for a few days off to celebrate this holiday with family in the Great Lakes -- regardless of frigid weather. We'll be back on Monday.
October 29, 2014
Security experts try to rein in POODLE
Sometimes names can be disarming ways of identifying high-risk exploits. That's the case with POODLE, a new SSL-based security threat that comes after the IT community's efforts to contain Heartbleed, and then the Shellshock vulnerability of the bash shell program. HP 3000s are capable of deploying SSL security protocols in Web services. Few do, in the field; most companies assign this kind of service to a Linux server, or sometimes to Windows.
The acronym stands for Padding Oracle on Downgraded Legacy Encryption. This oracle has nothing to do with the database giant. A Wikipedia article reports that such an attack "is performed on the padding of a cryptographic message. The plain text message often has to be padded (expanded) to be compatible with the underlying cryptographic primitive. Leakage of information about the padding may occur mainly during decryption of the ciphertext."
The attack can also be performed on HP's Next Generation Firewall (NGFW), a security appliance that is in place protecting thousands of networks around the world. Other firewalls are at risk. Just this week HP released a security patch to help the NGFW appliances withstand the attack. External firewalls are a typical element in modern web service architectures.
A POODLE attack takes a bite out of SSL protections by fooling a server into falling back to an older SSLv3 protocol. HP reported that its Local Security Manager (LSM) software on the NGFW is at risk. But a software update is available at the HP TippingPoint website, the home of the TippingPoint software that HP acquired when it bought 3Com in 2010. TippingPoint rolled out the first HP NGFW firewalls last year.The TippingPoint experts seem to understand that older protocols -- a bit like the older network apps installed in servers like the 3000 -- are going to be indelibile.
The most effective mitigation is to completely disable the SSLv3 protocol. If this is not possible because of business requirements, alternately the TLS_FALLBACK_SCSV flag can be enabled so that attackers can no longer force the downgrade of protocols to SSLv3.
What's at risk in your data pool? HP says it likely to be sensitive, short strings of data such as session IDs and cookie values, "which can then be used to hijack the users' sessions, etc."
Et cetera indeed. The added challenge which enterprise managers assume once they move into open networks are the POODLEs, shocks to a shell and the bleeding hearts of newer operating environments. The security expertise to meet these challenges is a well-spent investment -- whether it's through a 3000-savvy services provider, or the vendor of the migration target system that's just replaced a 3000.
Basic information on these threats is always provided for free. Implementation savvy can be a valuable extra expense. For example, HP adds this nuance about disabling protocols.
An important note: both the client and server must be updated to support that TLS_FALLBACK_SCSV flag. If both allow for SSLv3 and one of them has not been updated to support the flag, the attack will remain possible.
October 23, 2014
TBT: There Used to Be a Lab Around Here
Above, the Glendenning Barn Picnic Area, one of the signature elements of Hewlett-Packard's Pruneridge Avenue campus, heartland of HP's 3000 business. It's all been razed to below-ground level, as Apple builds its new intergalactic headquarters on the site.
One of the lesser-known tunes from the Frank Sinatra songbook is There Used to Be a Ballpark Around Here. The sentiment of the song wraps around the wistful view that something unique is now gone. Apple has posted the greatest quarter of business in the company's history. All through this year, it's been steadily displacing the HP labs where the 3000 and other products were designed and improved.
One 3000 engineer posted pictures of the current state of the 3000's estate. Only a multi-story mound of earth can be seen where handsome walkways, cooperative parking and stately poplars and pines were once the sentinels around the campus. People called their journeys to this location "a factory visit." One day while I was there on a press briefing, I was shown downstairs to a lower level -- where a manufacturing line was rolling out Series 68 servers.
HP's been cutting back on many things to maintain its profitability. Real estate has been at the head of the list the company no longer needs. You can consider that HP has closed its MPE/iX labs in California, yes. But the labs themselves -- cubicles and miles of network cables and office furniture and meeting rooms named after types of trees like Oak and Maple -- those are all gone now, the home of more than 3000 enterprise computing. It's all been moved away and changed.
Steve Jobs and Larry Ellison once walked the streets of Palo Alto and bemoaned the changes at Hewlett-Packard, not quite five years ago this fall. Apple, Jobs hoped, would be built to last as long as HP and become the kind of headwater for inspiration and innovation that Hewlett-Packard was. The street that faced that Pruneridge Avenue entrance had Tandem Computer on the facing curb. Tandem, spun off from HP by James Treybig, until HP assimilated it to become its NonStop group. Now the spinning comes anew to this street, soon enough to be the site of a spaceship-sized Apple HQ.
Apple has done all that it can to become the HP of innovation, plus added an ability to capture the lightning in a bottle of excitement about new tech. It's a fulfullment of Jobs' dream to see the company rise up on the ballpark site of HP's enterprise computing labs.
October 17, 2014
Tracking MPE/iX Vulnerability to Shellshock
Security experts have said that the Shellshock bug in the bash shell program is serious. So much so that they're comparing it to the Heartbleed breach of earlier this year. Many are saying Shellshock is even more of a threat.
Once again, this has some impact on HP 3000s, just like Heartbleed did. But you'll need to be managing a 3000 that's exposed to the Internet to see some risks to address as part of system administration. Web servers, domain name servers, and other net-ready services provide the opportunity for this malware. There's not a lot of that running in the customer base today, but the software is still sitting on the 3000 systems, programs that could enable it.
Authorities fear a deluge of attacks could emerge. The US government has rated the security flaw 10 out of 10 for severity.
Bash is open source software, and our expert on that subject Brian Edminster is working on a specific report about the vulnerabilities. Hewlett-Packard posted a security bulletin that points to a safer version of the bash shell utility. But that version won't help HP 3000s.
It's not that HP doesn't know about the 3000 any longer. The patching menu above shows that MPE is still in the security lexicon at Hewlett-Packard. But Edminster thinks the only way to make bash safe again on MPE might be to port it a-fresh. "The 3000's bash is version 2.04, but the version that's considered 'current' is 4.x (depending on what target system you're on)," he said. "So if v2.04 is broken, the code-diffs being generated to fix the issues [by HP] in late-model bash software won't be of much (if any) use."One report in a UK newspaper suggested that "if online retailers use older, mainframe-style computing systems, they are likely to be vulnerable." That sounds like one way to describe the Ecometry sites still selling online with MPE versions of that software. Many of those customers do not have the 3000 directly exposed to the Internet, though.
The bug allows hackers to send commands to a computer without having admin status, letting them plant malicious software within systems.
HP has released a software update to resolve the vulnerability in HP Next Generation Firewall (NGFW) running Bash Shell. Version NGFW v22.214.171.12453 will fix the breach in that that product. But NGFW doesn't run on MPE/iX.
Edminster forwards this advice while he's working on his report.
It's most likely to be an issue for web services that use bash scripts to process web-page input for example, such as machines exposed to the Internet, and those that have services that can accept input from the 'net. I'll work to round up as many examples of potential places this can be felt on a 3000, so that folks know where to look.
Yep — this one is messy, because it's not quite so cut-and-dried as HeartBleed was.
October 15, 2014
Signed malware stalks HP's Windows boxes
HP will be revoking a security certificate for its Windows-based systems on Oct. 21, and the vendor isn't sure yet how that will impact system reliability.
The bundled software on older HP PC systems has been at risk of being the front-man for malware, according to a report in the Kerbs on Security website. This code-signing is supposed to give computer users and network admins confidence about a program's security and integrity. HP's Global Chief Security Officer Brett Wahlin said the company is revoking a certificate it's been using even before 2010.
HP was recently alerted by Symantec about a curious, four-year-old trojan horse program that appeared to have been signed with one of HP’s private certificates and found on a server outside of HP’s network. Further investigation traced the problem back to a malware infection on an HP developer’s computer.
HP investigators believe the trojan on the developer’s PC renamed itself to mimic one of the file names the company typically uses in its software testing, and that the malicious file was inadvertently included in a software package that was later signed with the company’s digital certificate. The company believes the malware got off of HP’s internal network because it contained a mechanism designed to transfer a copy of the file back to its point of origin.
The means of infection here is the junkware shipped with all PCs, including HP's, according to HP 3000 consultant and open source expert Brian Edminster. In this case, the revoked certificate will cause support issues for administrators. The certificate was used to sign a huge swath of HP software, including crucial hardware and software drivers and components that are critical to Windows.
"This is one of the reasons that I absolutely loath all the 'junkware' that is commonly delivered along with new PCs," Edminster said. "I end up spending hours removing it all before I use a new PC." Recovery partitions on Windows systems will be at unknown risk after the certificate is pulled Oct. 21, too.HP's Windows computers have recovery partitions on the boot hard drive that can restore a system to its original, factory-shipped software configuration. That configuration includes the junkware.
"For me, this junkware is just chaff," Edminster said, "and an opportunity to clog up a machine that's supposed to be pristine and new. To say nothing of increased opportunities for the sort of thing outlined in the Kerbs article."
HP's Security officer Wahlin said that admins will have to wait to see the impact of that revoked certificate, according to the article.
The interesting thing that pops up here — and even Microsoft doesn’t know the answer to this — is what happens to systems with the restore partition, if they need to be restored. Our PC group is working through trying to create solutions to help customers if that actually becomes a real-world scenario, but in the end that’s something we can’t test in a lab environment until that certificate is officially revoked by Verisign on October 21.
October 10, 2014
When Smaller Can Be Better
Hewlett-Packard has chosen to cleave itself into two much smaller companies. It will take most of the next year to make that a reality. But it might be an advantage to return to working with a more nimble company. Well, an advantage to the 3000 site that's migrating to HP's other computer enterprise solutions, or has done so recently.
Over at the New York Times, the tech writers found something to praise even while they questioned the wisdom of the move.
In one day, Meg Whitman has created two of America’s biggest companies. All she had to do was break apart Hewlett-Packard, the company credited with creating Silicon Valley. HP Enterprise is targeting a market that appears full of potential innovations, while HP Inc. seems stuck in the low-margin consumer hardware business that has proved a slog for companies not named Apple or Samsung.
It appears Whitman has found a vision: one that looks a bit like the IBM of the West — with an emphasis on products rather than IBM’s consulting services — and another that looks a bit like Compaq Computer, a Texas computer company that HP controversially merged with 12 years ago.
A long time ago, in a marketplace now far away, 3000 owners wished for some breaking off. The HP 3000 wasn't a part of Hewlett-Packard's vision? Fine. Sell the unit off and let's get on with a focused future. At the time, the business was said to turn over $1 billion yearly. Even at half that size, it would've been big enough to survive with customer loyalty. If the 3000 had nothing else going for it, you could count on loyalty.
All opportunities now gone, you say. You just cannot break up an enterprise tech player like that. Then Whitman chops a massive company into two much smaller parts. Smaller has been better for the typical 3000 customer for a long time. Yes, there are times when there are advantages of being big: When a 3000 user got more from a company which sprawls to supersize, in sales and scope of solutions. You get predictability, alliances and headroom from companies sized HP. The vendor so lusted after being No. 1, which did not become a path to long-term success.
3000 community members understand that smaller can be better -- not bigger -- especially when they use what the independent vendor lives upon. Small companies respond faster, polish relationships, and commit for life.
Faster response can mean software that is enhanced sooner, or answers that resolve problems more quickly -- because a smaller company has fewer layers for a customer to dive through. Relationship polishing is the personal attention to a company of any size: the kind of experience that HP 3000 managers, who may now be CIOs and CTOs, recall getting from a smaller HP.As an example, the Support Group knows its customers on a first-name basis. The operations at this 3000 provider include a hotsite datacenter located about 100 yards from the call stations. This integration of support and cloud services is natural, seamless, and don't require a special manager to coordinate.
You can get that kind of integration in an encounter from HP for a migration platform. Whether it slips smoothly into the budgets of small to midsize companies is less certain. So much of the HP offerings don't come from Hewlett-Packard while the vendor engages smaller customers. Independent partners deliver services in what HP considers a smaller marketplace.
Then there's that "outside the product" call that a 3000 user makes to a long-time supplier. This call is really about the 3000, not the product in the support contract. But that doesn't make a difference to a smaller company than HP. Large IT vendors don't even have a coding category to let that call begin, let alone be resolved.
Finally there's the final chapter of a relationship between smaller customer and smaller provider. I call this "commit for life" because it represents the intention to maintain a relationship to the very end, not when a business strategy changes in a boardroom. Years ago, Robelle told the community it would support the 3000 until at least 2016. As long as there's still a customer around, STR Software says they'll support them on the Fax/3000 solution. Commit for life means a smaller vendor's lifespan, most of the time, -- not the lifetime of its business plans.
October 09, 2014
TBT: A 3000 Newsworthy Birth Day
The first issue of the Newswire ran its black and red ink across 24 pages of an early October issue. Inside, the first FlashPaper late-news insert had been waiting a week for main-issue printing to catch up with mailing plans.
In our ThrowBack to this week of 1995, the first issue of The 3000 Newswire rolled out into the mails. The coverage of the HP 3000 was cheerful enough to encourage a belief that the computer would run forever -- but 19 years of future was far from certain for either the system or the first 3000-only publication. Volume 1 (the year), Issue 1 came out in a 24-page edition, the same page count of the printed issue that just mailed this Fall. At the Newswire's introduction, one user group leader wondered aloud, on a bus ride during the Interex '95 conference in Toronto, "what in the world you'll might be able to find to fill up the news in Issue No. 2."
The last of the competing HP-only publications closed its doors 10 years later, when Interex folded its user group overnight. Interact, HP Professional, SuperGroup, HP Omni and others turned out the lights during that decade.
The Newswire's first mailed issue was carrying the news circulating in mid-August during an Interex conference. For the first time in 10 years, an HP CEO spoke at the Interex event. However, Lew Platt was a current CEO when he spoke to the 3000 faithful. David Packard was a former CEO and board member when he addressed the multitudes at Interex '85 in Washington DC.
Platt said that HP 3000 users had nothing to fear from a future where Unix was in vogue at HP. Earlier in the day, speaking before the full assembly of users, he said HP was going to making new business by taking out older products. At an editor's luncheon we asked him what that mission held for the 3000.
Platt explained his prior comments on cannibalizing HP's business to maintain steady growth. MPE/iX won't be served up in a pot anytime soon. "I don't mean leaving customers high and dry," he said. "HP has worked extremely hard with products like the HP 3000 to make the people who have bought them have a good future. We've put an enormous amount of energy out to make sure we can roll those people forward. I'd say we've done a better job than just about any company in the industry in providing a good growth path for those customers."
The CEO went on to explain how cannibalization would work. HP would take a product, such as a printer, that was doing perfectly well and may still be a leadership printer in the market -- and bringing in a new one before it's reached its end of life. If you substitute "business server" for "printer" in that plan, you can see how a computer that was doing perfectly well might see a new computer brought in before the end of its life. In that issue, the Newswire story noted that the project we'd learn to call Itanium six years later was going undercover, so that new product wouldn't lock up existing server business for a year before it would ship.
HP was calling the joint effort with Intel the Tahoe architecture, and Platt would be retired from his job before anything shipped.Sixteen more stories made up the news in that October of 19 years ago. The Series 9x9 line had an 8-user model introduced for just under $50,000. It was the era when a 3000's price was set by the number of its concurrent users. A 40-user 939 sold for $30,000 more, despite having no extra horsepower. User-limited licensing, which HP maintained for the 3000 while Windows was free of limits, would continue for the next six years.
An Interex survey said that three-fourths of 3000 customers were ready to reinvest in the line, but the article focused on the better value of the server in the users' estimation. HP's Unix servers were compared to the 3000.
The story atop Page One addressed the limits of those user-based licenses, and how a requested MPE improvement would help. SIGMPE's Tony Furnivall said that "if you could have multiple, independent job queues, the same algorithms ight be used to limit the number of active sessions." Any 8-user 3000s that were replaced with 800-user systems would be subject to more costly software licenses from third party firms. User-based licensing was prevalent, if not popular, in the 3000 world of October 1995.
On the first three inside pages were a story about the country's oldest pastime, a pointer to a then-new World Wide Web that included a Newswire page, and a full-page HP ad that said, "You want open systems computing. You don't want to move mountains of critical data to a new platform." Hewlett-Packard would hold that view for about six more years. The next 13 have made up the Migration Era, with a Newswire printed across every one of those years. The Newswire has been published more than twice as long during those migrations as all the years before HP announced the end of its 3000 plans.
Cal Ripken, Baltimore Orioles baseball all-star, was breaking a record for consequitive games played that began 13 years earlier. "We're here in your hands this month because of the legendary, Ripken-esque performance of the 3000 deserves more attention," an editorial crowed.
A PC and printer executive at HP got the job as chief of all computer business. It was the second additional layer of management inserted between the CEO and the 3000 group. Rick Belluzzo was 41, commanding a $20 billion sector, and didn't have a specific job title. Olivier Helleboid was 3000 General Manager three levels down.
Windows 95 was launched at that Interex show in Toronto with a mountaineer rappelling down the CN Tower, stopping halfway and "using Win95 from a wireless laptop. It was all too much for Birket Foster, president of HP 3000 channel partner M.B. Foster Associates and a supplier of Windows products."
"It's all a media event," Foster said. "Is the average user going to do that? It's all way too much hype for what's being delivered." A survey showed no manager had installed Win95 company-wide yet.
HP's managers shed their coats and ties at a roundtable en masse, after customers pointed out that IBM's officials dressed casual on the conference's expo floor. A technical article detailed the relief that PatchManager/iX delivered for MPE patch installs. New 3000 integrators were announced for manufacturing and FileNet workflow document services; the latter had six companies listed in the US.
One of those in-between HP managers said the company "now sees the 3000 as something sold to new customers mostly as an engine for specific applications, like manufacturing or healthcare systems." Porting applications from other systems would be made easier with the first C++ for MPE, the freeware GNU C++ suite, bootstrapped by ORBiT Software's Mark Klein. The GNU package made possible a host of open system tools within two years. "HP is helping to distribute GNU C++ form its HP 3000-based World Wide Web server on the Internet," the story added.
Ultimately, the Web server software HP shipped for MPE/iX was ported from Apache source code from the open systems world. HP told its DeskManager office communications users to expect enhancements first on HP's Unix systems. Helleboid, forecasting HP's final act in the 3000 world years later, said in the first Q&A that HP would collaborate with arch-rivals IBM, Digital and Sun to create "a complete environment for Unix applications."
Helleboid also said that the 3000's Customer First strategy would be presented to other HP computer groups such as its Unix group. "Customers are looking for this kind of relationship," he said in a forecast of using 3000 ideas to improve replacement business models.
October 07, 2014
HP decides to break up the brand
And in one stroke of genius, it's become 1984 again at Hewlett-Packard. Yesterday brought on a new chorus for an old strategy: sell computers to companies, and leave the personal stuff to others. Except that one of the others selling personal computers, plus the printers usually connected to PCs, is another generation of the company. The CEO of Hewlett-Packard is calling the split-off company HP Inc. But for purposes of mission and growth, you could call it HP Ink.
To be clear, that's a broad definition we used up there to define that stroke of genius. Brilliance is something else, but genius can be just a powerful force for good or for ill. Definition 3 of the word in Apple's built-in dictionary on my desktop calls genius "a person regarded as exerting a powerful influence over another for good or evil: He sees Adams as the man's evil genius." It's from Latin meaning an attendant spirit present from one's birth, innate ability, or inclination.
What's become the nature of Hewlett-Packard, its innate ability? The company was founded on one ability and then had a second grafted onto its first success. It's been 30 years now since 1984, when the vendor which invented MPE and the 3000 has been inventing products for consumers. The LaserJet opened the door for a torrent of ink and toner to sweep around traditional technology innovations. Before there was a need for a battalion of printing devices and a phalanx of personal devices, the old HP logo represented business and scientific computing. Plus a world-leading instruments business whose profile was an icon for what HP was known for best.
HP's been down this path before, splitting off those instruments into Agilent in 1999. A few months later Carly Fiorina won the approval of then-ink czar Dick Hackborn, placing her in the CEO's seat. Yesterday's announcement of splitting the company into two complementary entities returns the Hewlett-Packard name to enterprise computing. But it seems the core values of the only major IT vendor named after its founders won't rebound into favor. Not on the strength of just splitting off high-cost, high volume ink and PC business. HP needs to impress people with what it builds again. Not just what it can aggregate and integrate.
A few notes we took away from that announcement:
- HP says it aims to be two Fortune 50 companies after breakup, but more nimble and focused
- "The brand is no longer an issue," say HP executives, and breaking up the brand will create equal-sized businesses.
- An extra 5,000 layoffs come along with the split-up. The running total is now 55,000 on the clock that started in 2011.
- HP likes its own idea; prior chairman Ralph Whitworth called it a "Brilliant value-enhancing move at the perfect time in the turnaround."
- CEO Meg Whitman says HP's turnaround made the breakup possible.
- Its stock traded more than five times its usual daily shares on breakup news, and picked up almost 5 percent in share value. HPQ also gave away all of that gain, and more, the very next day.
That's how it goes in the commodity computing market: easy come, say the customers, and easy go. It might be why Whitman is helping the brand called Hewlett-Packard break away from the commodity business.Some analysts have noted the current board chair and CEO of today's un-split entity, the one still called HP, will take charge of the enterprise arm of the company's future. This, they reckon, is where the real innovation and action will take place. The part of the company that pulled Hewlett-Packard into the consumer reseller model, then swallowed up the second-place PC provider in Compaq 12 years ago, has been set free to float at the whims of a roiling market. HP Inc will have to compete without a dynamic mobile product line, and so we can wish the new-ish part of the vendor godspeed and good luck. They'll need it against the likes of Apple and Samsung, or even Lenovo and Lexmark.
HP's story last year was that the company was better together, after hearing seven years of calling for a split up. High volume, low profit business was suited to a market of 1999, but once mobile devices and the Web changed the game for data processing, PCs and printers just wanted different resources than servers and software demanded. Now CEO Meg Whitman says Hewlett-Packard and HP Inc. can focus and be nimble. From a 3000 customer's perspective, that focus would have been more useful 13 years ago, when growth demanded HP buy Compaq for $25 billion on the promise of becoming No. 1.
Being No. 1 didn't last long enough to pay the bills incurred to do so many things at once. Now Whitman says that three years of turnaround action has taught the company how to do more than one thing at a time. There's plenty to do. Maybe the first thing is to choose a new color to represent its oldest business. She said HP blue to going with the multi-colored ink of HP Inc.
Hewlett-Packard didn't need multiple colors to succeed on that 1984 day it added printers to its product line. But it was a company wrapped in a handsome slipcase of collegial traditions, still working to win its way to the front of enteprise IT selections. Canon and Hewlett-Packard collaborated to sell a laser printer to anyone, not just the customers buying HP's specialized business servers. Before long, the trails it blazed in consumer sales gave it an opening for its color ink, which at one point contributed 55 percent of the company profits. That's the consumables bringing home the bacon, not the nearly-disposable printing devices.
During the era when the 3000 was given its last several years of HP life -- first five, then seven, and finally nine -- IBM was happy to point out the passion for printing at HP. One thunderbolt of an IBM sales rep called the company Inky at a HP user group meeting speech in Houston. Those were the days when everyone in 3000 territory was looking at a new future. About three fourths of the business machines became computers without Hewlett-Packard on their badges. Still, the fungible nature of enterprise computing -- that ease of replacement that HP preached against MPE -- also turned out to be true for its own Unix business line. Somehow, the same Windows that would be suitable for 3000 shops was also a good-enough migration target for HP-UX customers.
Unix had its day, and Linux was the new wave and not channeled through a single vendor. HP invited comparisons. Now its customers can compare companies, starting next fall. Do business with HP Inc. and use Windows and probably Linux on HP's iron. Or choose a company that says it's now focused on the new style of computing: cloud services, big data, security and mobility. The company does not mean to suggest there's no place for in-house servers. But it's focused on those four areas, with a mention of software during yesterday's 45-minute presentation and Q&A.
Our readers will remember software. In MPE and IMAGE they got fine-tuned and refreshed software each year, although in some years the refreshes were faint. By the middle of the 1990s Hewlett-Packard had to embrace Windows to remain on planning short lists. Now the Hewlett-Packard Enterprise has to attract and retain ever-mobile business on the strength of in-house innovations. Because if you want industry-standard commodity computing, HP Inc. is ready to take that business. It will soon be loose from the legacy of Hewlett-Packard.
October 06, 2014
HP to break itself, dividing into 2 companies
Hewlett-Packard announced this morning that it will divide itself into two publicly-traded corporations, a move that shareholders and stock analysts have been demanding and predicting for years. The division of the company will be along product lines. The business server operations will be contained in the new Hewlett-Packard Enterprise, while PC and printer businesses will comprise the new HP, Inc.
The vendor said in a press release that the restructuring will "define the next generation of technology infrastructure." The reorganization will also spin out the least profitable, but largest, segment of HP's business into its own unit. HP still ranks in the top five among PC makers and is one of the largest makers of printers in the world.
Meg Whitman will be CEO and president of the Hewlett-Packard Enterprise company. Pat Russo will chair a new Hewlett-Packard Enterprise board of directors. Last month Hewlett-Packard -- the full corporation founded by Bill Hewlett and Dave Packard in 1939 -- had named Whitman as chairman of the board and CEO. By breaking up the company, Whitman will cede some control of its most competitive and popular product segments.
Dion Weisler will be the head of the new HP, Inc. as CEO and president. Whitman will chair the HP Inc. board of directors. HP said it will still meet its profit forecasts for the fiscal year that ends on Oct. 31. It also said that it "issues a fiscal 2015 non-GAAP diluted Earnings Per Share outlook of $3.83-$4.03." That is the sweetest way of forecasting a profit, using non-Generally Accepted Accounting Practices. But it's not clear if that's HP Inc. profits, or profits for Hewlett-Packard Enterprise. And the vendor said it would take all of fiscal 2015 to complete the transaction.
“The decision to separate into two market-leading companies underscores our commitment to the turnaround plan," said Whitman, who's led HP through three years of a five-year turnaround plan. "It will provide each new company with the independence, focus, financial resources, and flexibility they need to adapt quickly to market and customer dynamics, while generating long-term value for shareholders.
"In short, by transitioning now from one HP to two new companies, created out of our successful turnaround efforts, we will be in an even better position to compete in the market, support our customers and partners, and deliver maximum value to our shareholders."Much of the rest of HP's release deals with the visions and mechanics of dividing a $128 billion company into a classic and post-modern product manufacturer. Except that nothing is classic about the Hewlett-Packard Enterprise company, with the exception of its three proprietary operating systems: HP-UX, OpenVMS, and NonStop. The company has announced that HP-UX will be extending some of its enterprise-grade features to a version of RedHat. OpenVMS will be curtailed to only the newest generation of servers for the latest version of the OS. And NonStop, the most specialized of the three operating systems, is getting a full port to the x86/Xeon architecture -- an escape hatch from the Itanium chips that power Integrity servers.
But HP is retaining the Financial Services unit inside the Hewlett-Packard Enterprise corporation. It's a move the company noted will give financial advantages to customers and partners.
Hewlett-Packard Enterprise will have a unique portfolio and strong multi-year innovation roadmap across technology infrastructure, software and services to allow customers to take full advantage of the opportunities presented by cloud, big data, security and mobility in the New Style of IT. By leveraging its HP Financial Services capability, the company will be well positioned to create unique technology deployment models for customers and partners based on their specific business needs.
Additionally, the company intends for HP Financial Services to continue to provide financing and business model innovation for customers and partners of HP Inc. Customers will have the same unmatched choice of how to deploy and consume technology, and with a simpler, more nimble partner. The separation will provide additional resources, and a reduction of debt at the operating company level, to support investments across key areas of the portfolio. The separation will also allow for greater flexibility in completing the turnaround of Enterprise Services and strengthening the company's go-to-market capabilities.
"Over the past three years, we have reignited our innovation engine with breakthrough offerings for the enterprise like Apollo, Gen 9 and Moonshot servers, our 3PAR storage platform, our HP OneView management platform, our HP Helion Cloud and a host of software and services offerings in security, analytics and application transformation," continued Whitman. "Hewlett-Packard Enterprise will accelerate innovation across key next-generation areas of the portfolio."
R&D innovation has been a troubled business operation for Hewlett-Packard since the early years of this century, until Whitman announced a shift in the vendor's priorities in 2012. She named Martin Fink, the former leader of the embattled Business Critical Systems unit where those operating systems are built, to lead HP Labs. Within a year, the Labs were creating The Machine, a way forward into a new architecture for computing -- but one that could demand up to 75 percent of the Labs' resources.
It's not yet clear where HP Labs will go in the reorganization, but the Enterprise unit seems to make the most sense. Labs also contributes to product releases in the printer and PC lineups. HP mentioned the forthcoming 3D printer lineup in the breakup announcement.
HP was to have a meeting with financial analysts in just two days, but "as a result of this separation, its Oct. 8 2014 Securities Analysts Meeting has been postponed." A conference call took place at 5AM today, and is available for replay at the HP Investor Relations website.
Whitman said only a year ago that a single HP was the right approach. She said the same strategy is still the right approach, but added that breaking up the company will accelerate growth. "We now operate from a position of strength," she said, citing a strong balance sheet and returns to shareholders. The stock was nearing $40 a share in recent months, a profound rebound from prices in the teens at the lowest point of the turnaround.
After the split up, shareholders of the HPQ security will hold shares in both companies, CFO Cathie Lesjak said in the confence call. It's a move that will prompt instant investment in the new HP Inc.
September 24, 2014
Did Charon get to where HP could've gone?
The past can't be changed, but that doesn't mean it's not useful in planning. There are still a surprising number of companies that want to stand pat without regard to the future of their hardware running MPE/iX. Some of it is old already, while other servers -- even those newest -- are now moving into their 10th year of service.
Hewlett-Packard's planning for the future of MPE/iX hosts once included a bold move. The operating system was going to run natively on Itanium-based servers, the IA-64 Integrity line (above) that hosts VMS and NonStop today. It was a project that did not make HP's budget cuts of more than a decade ago, and so the whole lineup got canceled. There might have been another way, something that HP could arrive at -- years after Stromasys started selling the solution.
Native hosting is always the preferred solution for an OS and its iron, sure. But there's so much virtualization these days; VMware is a significant market force. What if HP had taken MPE/iX and just put it onto another operating system's back? What if the OS that drives 3000 apps might have taken a ride in a carriage of Unix, or Linux?
HP did this sort of miracle once for the 3000, calling it Compatibility Mode. There was a massive revison of hardware and software to arrive at the PA-RISC generation, but the changes were transparent to customers. You ran your apps in CM, until you could move them forward. In the '90s, companies used compatibility mode for years, installing newer hardware and moving up to better performance by revising their applications.
"If all HP had done was to create a Compatibility Mode for MPE on IA-64," said ScreenJet's Alan Yeo, "nobody would have batted an eyelid about swapping to an HP-UX box to run their company's software."
At its heart, this is what Stromasys has done with its software. The only difference to the customers is that it's a solution not sold and supported by their hardware vendor."There was a huge effort, like HP should've moved MPE to IA-64, Yeo said. "It was totally nonsensical." And costly, too. Stromasys was discouraged while there were still thousands of customers of HP 3000s choosing where to migrate. Key technical trade secrets were not being shared, so Charon for the 3000 had to be tabled. HP came back to the idea after they'd lost more than half of the installed base to other vendors.
For the record, Windows migrations count as another vendor. If not for the fact that HP sells ProLiant servers, that percentage of 3000 sites lost to the competition would be even higher. When you cede the OS to another company, you can lose the leverage to call a site Your Customer.
This matters when looking at where virtualization operates today. Using a wide variety of hardware hosting, from HP's iron to many others, Charon does the carrying of MPE while it rides in the vehicle of Linux. It might have been HP-UX at one time, if HP had just modified its plans to make that move to IA-64 a less costly lab project.
Almost three years ago, Hewlett-Packard announced it would introduce a new version of Integrity servers, Superdomes no less, that could run the x86/Xeon family of chips. There's no delivery date, and most recently we hear the vendor's building The Machine. New OS, new chip design. The same old sweeping vision that created things like VMS, MPE, and NonStop. Costly? Martin Fink wants about three fourths of the HP Lab budget to get it built and customer-ready.
But that NonStop environment has gotten the Big Promise of a new native version, capable of running on the Xeon family. No deadline for when that will be delivered, either, but HP wants to retain those customers. The complexity of applications in MPE can pale when compared to the ultimate real-time computer system. NonStop clients have lock-in that encourages HP to do the grand sweep into the future for them.
At the time that HP will have Xeon versions of Integrity ready -- services that could host Linux and therefore cradle a virtualized MPE server -- Stromasys will have about five years head start in selling that solution. We'll be generous and figure the Integrity models that are ready for Xeon blades will sell in 2017. There might be a market for that, for some companies that still want a big vendor to rely upon. But HP could've had that market a decade ago, just by aiming for a CM for MPE.
Customers don't really care that much about genuine PA-RISC iron, or something called an HP 3000 If they did, there would be no traction for Charon at all. With every passing week, that continues to be proven untrue.
September 12, 2014
Can HP's cloud deals ground enterprises?
Editors at The New York Times seem to believe the above is true -- or more to the point, that cloud business will come at the expense of HP's hardware revenues. Nobody knows whether this is the way that HP's clouds will rise. Not yet. But a deal to buy an open source software company caught notice of a writer at the NYT, and then came a saucy headline.
HP Is Committed to the Cloud, Even If It Kills. The bulk of the story was about Marten Mickos, who sold his company Eucalyptus to Hewlett-Packard and got himself named as General Manager of HP Cloud Business, or somesuch. Open source followers will know Mickos as the man who sold mySQL to Sun, sparking some fury in a customer base that didn't want any connection to major vendor. (As it turned out, Sun wasn't really a major vendor at all, just an object for Oracle acquisition.)
This only matters to migrating customers who use HP 3000s, so if you're still reading and you're homesteading -- or migrating away from HP altogether -- what follows is more for sport than strategic planning. But once more, I'll remind readers that HP is looking for anything that can lift its fortunes. Selling enterprise hardware, like the Integrity servers which are the only island where HP-UX can live, has got a dim outlook. Selling cloud services instead of hardware has plenty more promise, even if it's largely unrealized at HP today.
The rain-clouds in HP's skies come from Amazon, mostly, whose Amazon Web Services is the leader in a growing segment. Eucalyptus works with AWS, and that seems to be the major reason that Mickos gets to direct-report to HP's CEO Meg Whitman. Eucalyptus manages cloud computing systems. HP still sells hardware and software to host private clouds, but an AWS arrangement is a public cloud concept. HP wants to be sure an AWS user can still be an HP customer.
Clouds have a penchant for carrying a customer away from a vendor. Or at least a vendor's hardware. In the NYT story, "HP will have to rely less on revenue from selling hardware, and more on software and service contracts. 'Success will be a tight alignment of many parts of the company,' said Mr. Mickos. 'We have to figure out how to work together.' "
If you go back 24 years, you can find some roots of this HP desire on a stranded pleasure boat in the San Francisco harbor. But until the business critical HP iron stopped selling, the company never believed it would have to set a rapid course for services.In the fall of 1990, HP hosted a CIMinar conference, mostly for the press and some big customers. The letters stood for Computer Integrated Manufacturing. There was a dinner party on a nice cruise boat as part of the event. When the engines died after dinner, the boat sat in the bay for awhile. We all went out to the deck to lean on the rail and catch some cool air and wait for the tug. That's when Charlie, HP media relations guy, explained that hardware would be on its way out.
"We don't want to sell servers in the long run," Charlie said, while we were talking long enough that he got to the soul of what he believed. He was a former trade press reporter and a good media guy, too. "HP wants to be in the services business, and maybe selling some software."
So here we are, close to a quarter-century later, and now HP's finally found a reason to buy open source software and the fellow who guided it into several hundred companies. Then name him head of HP Cloud making. They hope the whole deal will turn him and his software into a rainmaker for HP enterprise revenues.
While the Times article has got its problems, it got one stretch of the story pretty accurate. HP, like it has said for several decades, is just following its customers. Apparently, away from relying on HP's hardware.
Putting services and hardware together in new ways is part of "the hard hill we are in the process of climbing," said Martin Fink, HP’s chief technology officer and the head of HP Labs, where much of the development is taking place. "Is there uncertainty? There is always uncertainty." He added that Ms. Whitman has determined that this is where customers are going, so HP needs to adjust its business accordingly.
For years, the HP 3000 community wanted Hewlett-Packard to make recommendations to customers about which HP solution to employ. No dice. "We just want to be trusted advisors," HP said over and over. "The customer will tell us what they need, and then we will provide it."
And if the customer needs more legroom to use Integrity and HP-UX? Well, there's always that uncertainty that Mr. Fink mentioned.
August 25, 2014
Shopping While Lines are Dropping
HP's third quarter financial report showed that a company making adequate profits can also be making products that are not popular any more. The time comes to every product line, but the Hewlett-Packard of 2014 has made steady progress toward commodity-style enterprise computing. The pull into Windows has become a vortex -- and in a bit of irony, Windows' age helped HP's sales this quarter.
The overall numbers were impressive to the markets. Investors lifted the price of HP's stock more than $2 a share, after the briefing, sending it closer to $40 than it's been in years. Meanwhile, the continued downturn of Business Critical Systems scarcely earned a minute's mention. It's off 18 percent from the same 2013 quarter. But it gets less than a minute because BCS products like the HP Unix line, and VMS computing systems -- even the steady but meager business of NonStop -- only comprise 3 percent of the company's enterprise sales. In the circle above, BCS is the rounding error, the most slender slice. Click it to see a bigger picture of that smallest piece.
And Enterprise represents just one dollar out of every four that HP earns in sales. This is activity in the Industry Standard Systems. These are the ProLiant servers driving Windows and Linux, business that grew 9 percent. Specialized operating environments like HP-UX just aren't producing new business, and they're losing old customers. If you look over the last three years of Q3 numbers, each and every one shows a double-digit BCS decline. There's only so much clock time on that product wall before irrelevancy pushes a community off HP's futures map. It happened to the HP 3000, but MPE never ruled over HP business computing like Unix once did.
"When I look at the way the business is performing, the pipeline of innovation and the daily feedback that I receive from our customers and partners, my confidence in the turnaround grows stronger." -- Meg Whitman, CEO
So when HP's business in your installed platform shows poor numbers, what do you do? The rest of the company's report looked tame, although you'd wonder why anyone could be sanguine about the future of the company. Printing, Services, Software and Financial Services all dropped their sales top lines. The Enterprise Group grew its business 2 percent overall on a $27.5 billion HP sales quarter. This was accomplished by $57 million of expense cuts.
Only PC sales grew along with enterprise business. How can a company reporting a 27 percent drop in profits, one that missed its forecast by more than 10 percent, be rewarded on the trading floor? Jim Cramer of MSNBC said there's just enough to like about HP now. That might be due to the history the company has turned back. Everybody on the trading floor remembers HPQ at $12 a share with a fired CEO having followed an ousted CEO. Historic lows are a faded memory now, although the company's gotten no bigger over that stretch of clock time. The good feelings come from a turnaround tale that's still in the middle of its story.But it is history that is the biggest concern for owners of the plunging VMS and HP-UX servers. Hewlett-Packard may never kill off an enterprise product line again like it did with the HP 3000. But becoming irrelevant is a fatal blow, too. Customers choosing to manage their own datacenters are taking shelter in Linux and Windows, according to HP's report. The analysts are pleased with the company's net operating cash position, which at $4.9 billion is 80 percent higher than last quarter. But that's $2.2 billion extra not being spent on R&D for the company's specialized technology running in HP 3000 migrated sites.
This kind of sour outlook is like a chart-topping record back on '60s radio. As a customer you hear it all the time. But it's not a concern to the corporation making the Unix servers, or to the investors who propel that company into the future. You have to wonder why anyone else would care. It's an even more distant piece of history to recall the day MPE slipped into HP's under-a-minute bin. Enterprise outlook is not part of what Cramer likes about HP this month.
There's shopping until you drop, and shopping until the product line is dropped. The latter's probably years away for the enterprise products that are not commodities. The HP 3000 migrated base has experience in how to manage their investments in a line HP won't watch any longer. At some point they'll draw the line on whether their servers need to be powering Unix or VMS applications. It's the apps that steer operations investments. By this point, it would be news if BCS numbers did not drop.
It's a good thing that Windows XP dropped out of Microsoft's support plans. The demise of a popular OS left companies with a problem that required replacing aged PCs. The CEO is getting good at keeping HP's aged strategy from pulling down growth, but it's been flat for a long while. If there's a future to owning and staying loyal to Hewlett-Packard enterprise systems, few analysts can see it. You must look at customer applications -- and the dug-in nature of legacy computing -- to see the staying power.
August 12, 2014
Where a Roadmap Can Lead You
In preparation for its upcoming VMS Boot Camp, Hewlett-Packard has removed some elements of its roadmap for the operating environment. What's disappeared are no small thing: dates.
As the system neared its change of life at HP, customers of the HP 3000 saw their roadmap get less certain about its estimated time of arrivals. At the end of the vendor's interest in selling and creating more systems, an elaborate PowerPoint slide showed multiple levels of servers. The roadmap actually got a cloud creeping in from the right hand margin.
Okay, that was 13 years ago this very month in Chicago. But it was not the last HP World conference -- that would be one decade ago, this month -- not any more than next month's Boot Camp for VMS enthusiasts and customers will be the last. But there have been times when VMS had promises from HP's management of another decade of service. Here's the before, and the after.
Very few products last for lifetimes. Knowing when they're going, and how soon to make plans for replacement, is serious business for an IT manager.
During an August in 2001 when the future looked certain and solid for some customers, a PowerPoint slide told more than could be easily read in Chicago for HP 3000 customers. For the record, the slide below delivered everything promised up until 2003. The PA-8800 never made an entry into the N-Class.
That would be known, in the roadmap parlance, as a PA-8xxx. The PA-8yyy (8900) never made it into a 3000, either.
Roadmaps might be an old tradition, but they're moments to establish and renew trust in a partner. Specific, and follow-through, make that possible. Some VMS customers are already underway with their migration assessments.
August 05, 2014
Boot Camper laying down migration steps
More than a decade after HP began its migration away from MPE and HP 3000, there's another underway among the vendor's enterprise systems. OpenVMS customers are starting to look into what's needed to make a transition off the Digital servers. HP's announced that it will curtail the use of the newest VMS to the very latest generation of hardware. Thousands of servers are going to be stuck on an older OpenVMS.
That will be one element to spark the offers at next month's VMS Boot Camp in Bedford, Mass. We heard from a veteran HP 3000 and MPE developer, Denys Beauchemin, that his company is headed to the Boot Camp for the first time this year. There's engagements and consulting to be made in moving HP enterprise users to less HP-specific environments.
"We migrate them from VMS to Linux or other platforms," said Beauchemin, who was the last working chairman at the Interex user group before the organization went dark in 2005. "Another HP operating system comes to an end."
Boot Camp is a VMS tradition among HP's most-loyal general purpose computing community. (You can't call the 3000 community HP's any longer, now that the vendor is coming up on seven years without a working lab.) Boot Camps in the past were annual meetings to advance the science and solutions around VMS. But in more recent times they haven't been annual. Now there's migration advice on hand for the attendees. Some may view it with disdain, but when a vendor sends up signals of the end of its interest, some kinds of companies make plans right away to migrate.There is a strong presence in the VMS community for the Stromasys virtualized server solutions. Stromasys made its bones helping VAX and Alpha customers get away from DEC-branded servers; the company was established by the leader of the Digital migration center in Europe.
VMS might be just as essential in some companies as MPE has turned out to be. This is what's made Stromasys CHARON HPA a quiet success in your own community. As VMS customers face the end of HP's support for older hardware -- the latest OpenVMS won't run -- some of them may be looking to a virtualized version of the newer VMS systems. This strategy isn't without its efforts, too. Comparing migration to virtualization as a way into the future is likely to become a diligent task for another HP operating system customer base.
August 01, 2014
HP doubles down on x86 Intel, not HP-UX
IBM's giving up on another market that HP continues to prize, but the latest one is more relevant to the small-sized enterprise where HP 3000 migrators hail from. (Years back, IBM sold its consumer PC business to Lenovo.) Now the modest-horsepower x86 server field's going to Lenovo, since IBM's decided to exit another Intel-based hardware market.
A longtime HP 3000 software vendor took note of this transition. He wondered aloud if the message HP now sends to its x86 prospects has a shadowy echo of another advisory, one delivered a decade ago. From our correspondent Martin Gorfinkel:
Hewlett-Packard has been running full page ads in the New York Times with the lead, “Building a cloud? Your future is uncertain.” (The “un” in “uncertain” is crossed out.) The ad goes on to say that the "IBM decision to exit the x86 server market impacts your cloud strategy." Thus, they say, move to HP and be assured that HP will not leave you stranded.
Would I be the only former user/vendor in the HP 3000 market to find that advertising hypocritical -- and further evidence that the company we once relied on no longer exists?
The hypocrisy is probably on display for any 3000 customer who was told Hewlett-Packard was making an exit from the 3000 hardware market (and by extension, the MPE software world). Every vendor exits some part of their business, once the vendor gets large enough to sell a wide array of products. IBM is dropping away from x86. HP invites enterprises to "join us to plan your forward strategy." This forwarding strategy of moving to Windows and Linux differs from HP advice of 10 years ago. Going to HP-UX was the strategy du jour, beyond a 3000 exit in 2004.
The full-page ads in four colors in a national daily announce a redoubling of effort to win Intel x86 business. That's going to suck up some energy and mindshare, effort that 3000 customers who followed HP forward on HP-UX are probably going to miss.It won't come as much news to the migrated customer who's been listening to HP management comment about the future of its Business Critical Systems Unix products. "A formerly growing business" is the best that HP's chairman and CEO Meg Whitman can manage in quarterly briefings.
IBM's moving in different directions than HP these days. A recent announcement pulls Big Blue into step with Apple to win enterprise business for both companies at once. Microsoft was once the savior of Apple in hard times. Now it looks like Apple, which has a valuation well above IBM's, is going to perform some salvation. HP had a shot at working with Apple in consumer business, but it was back in the days when selling re-badged iPods seemed like a good idea.
HP's attraction of IBM customers has been a give-and-take that goes back decades. In 1995, IBM wanted HP 3000 customers to switch to AS/400s. Database issues stood in the way of that effort, but certainly a very few companies made the transfer once HP announced an exit of the 3000.
In the same way, HP executives are claiming wins for business in the hundreds, according to an article in eWeek
According to Antonio Neri, senior vice president and general manager of HP's servers and networking businesses, the efforts over the past six months are paying off. The company has seen its win rate against IBM increase more than 40 percent, accounting for several hundred new deals won against Big Blue.
Customers in those deals might be the only parties who still have to figure out how they feel about this change. IBM is happy to let loose of server business that was killing its profits, according to a NY Times article. The changes say a lot about how important these big vendors consider enterprise server business. On one hand, IBM says there's no enterprise-caliber profit in selling x86. On the other, HP is happy to take on whatever customers IBM was passing over to Lenovo.
[Vendors'] businesses like PCs are losing ground to mobile devices like smartphones, and the once-formidable computer server is increasingly viewed as one more commodity piece of globe-spanning cloud computing projects from a few elite players.
“We need to get an inventor’s profit, not a distributor’s profit,” said Steve Mills, senior vice president of software and systems at IBM. “Our investment in research and development is what makes IBM go. It’s hard to do that in markets that don’t give you credit for the innovations you bring.”
It’s stark how quickly that margin fell away. A year ago, IBM was talking about a sale of its server business to Lenovo for what was reported at the time to be $6 billion. Today’s deal for $2.3 billion kept for IBM some higher-value servers, like those that perform complex data analytics. But according to Mr. Mills, it also included agreements for IBM to buy from Lenovo some of the commodity, or x86, servers for IBM’s growing cloud business.
And so there's the interesting wrinkle for anybody considering their migration off HP 3000s. IBM isn't giving up on cloud computing, not any more than HP has; both vendors want to host your applications on cloud servers they'll set up and maintain for you. (So does Amazon, of course, and probably at a better price.) Clouds might be the only way to get a 3000 migration that carries a budget similar to sticking with HP 3000s. Everyone wants to know more about security on clouds, but they want to know about security everywhere these days.
One combination you won't see is clouds and HP-UX computing. HP's own Cloud cannot host HP-UX apps, just those running Windows or Linux. It's an Intel party up there in the HP Cloud. (In a big piece of irony, Apple's OS X Unix is one of the supported HP Cloud installs.) Going forward from the 3000 with HP has more options than going forward than with IBM, right? It's true if you don't count Unix. Hewlett-Packard shows its strategy, with full-page splashes, that Unix counts for much less at enterprises.
We invite any correspondents who see the full-page ads about HP-UX enterprise to alert us. Twenty years ago, the HP 3000 customers were measuring the HP love by way of ads and alliances. To reply to the other part of Gorfinkel's question, we believe that old HP still exists. The company that 3000 customers relied upon in the '90s is repeating its behavior. It's just leaving a different OS out of its forward strategy this time.
Gorfinkel added that he managed to put his opinions into the inbox of the HP CEO. "I got a promotional email from HP that included – if you follow enough links – an opportunity to email Meg Whitman herself," he said. "Could not resist sending the following:
I cannot believe that HP is running full page ads pointing out that IBM decided to exit the x86 server market and that HP can be trusted to keep your future certain. Is there no corporate memory of the HP exit from the HP3000 market? None of us who felt our future was certain with the most reliable, most secure hardware/software combination in the industry have forgotten. HP left us stranded with a few independent vendors working to pick up the slack. Those who know of HP's history will just laugh (or cry) over the ad; others may be fooled.
It is certainly ironic!
July 31, 2014
TBT: Java's promise spun 3000s into style
Just about 15 years ago from this ThrowBack Thursday, the HP 3000 was having its high moment of renaissance at Hewlett-Packard. The computer was going to make its stretch into the world of a Java-based interface for applications, in an era when Java was considered stylish. A new Java library was going to be patched into the operating environment, and the 3000 division was about to enjoy its fourth straight summertime with the same general manager, something we'd not seen in many years.
Harry Sterling pushed at the heartstrings of the customers during his tenure leading the division, and in 1999 he threw out the stops to make the HP World conference update on the 3000 memorable. The 3000 was always in style, Sterling maintained, just like the classics of yo-yos (a popular late '90s show giveaway) and tuxedos. Sterling managed to pull off a combination of the two at what amounted to a State of the Product address.
His hour-long talk was built around the theme of "The HP 3000: Always in Style," and featured a video of customer interviews comparing the system to classic dances such as the tango and the waltz. The general manager finished his talk spinning a yo-yo from his hand.
“Just like this yo-yo and just like my tux are always in style, so is the 3000,” Sterling said. The white-hot dot com boom was on, and Sterling felt the yearning from customers to feel the heat.
"You are seeing a new mindset at HP, doing the things that will make it possible for us all to be a pivotal player in Chapter Two of the Internet. Many of you are saying it’s about time — and I agree.”It was the last such speech he'd give. He retired from HP and his position later that year, handing over leadership of the group to Winston Prather. Y2K came and went, and the tuxedo-flashing era came and went, too. At the time of Sterling's talk, HP shared details of a GUI plan it called Visage, figuring that legacy-looking apps were not helping the 3000 hold and win customers. Mike Yawn, the CSY engineer who lead the Java project for the 3000, outlined elements of using Java to build GUIs for existing 3000 applications, as well as creating interfaces from scratch for new apps.
Technology refreshes like integrated Java were not moving as fast as HP's top management changes; commodity computing was cemented in the CEO's office by the march of Windows into business readiness. Visage never made it out of HP's labs, while faster 3000s using a new IO bus remained on the runway of the labs too long, in hindsight. But for a week in San Francisco, while Hewlett-Packard celebrated its 60th company anniversary, the view of the 3000's future was stylish to the max.
July 23, 2014
Migrators make more of mobile support app
A serious share of HP 3000 sites that have migrated to HP's alternative server solutions have cited vendor support as a key reason to leave MPE. Hewlett-Packard has been catering to their vendor-support needs with an iPhone/Android app, one which has gotten a refresh recently.
For customers who have Connected Products via HP's Remote Support technologies, the HP Support Center Mobile (HPSCm) app with Insight Online will automatically display devices which are remotely monitored. The app allows a manager to track service events and related support cases, view device configurations and proactively monitor HP contracts, warranties and service credits.
Using the app requires that the products be linked through the vendor's HP Passport ID. But this is the kind of attempt at improving support communication which 3000 managers wished for back in the 1990s. This is a type of mobile tracking that can be hard to find from independent support companies. To be fair, that's probably because a standard phone call, email or text will yield an immediate indie response rather than a "tell me who you are, again" pre-screener.
But HPSCm does give a manager another way to link to HP support documents (PDF files), something that would be useful if a manager is employing a tablet. That content is similar to what can be seen for free, or subject to contract by public audiences, via the HP Business Portal. (Some of that content is locked behind a HP Passport contract ID.) This kind of support -- for example, you can break into a chat with HP personnel right from the phone or tablet -- represents the service that some large companies seem to demand to operate their enterprise datacenters.
There's also a Self-Solve feature in the HP mobile app, to guide users to documents most likely to help in resolving a support issue. Like the self-check line in the grocery, it's supposed to save time -- unless you've got a rare veggie of a problem to look up.Remote system administration isn't unheard of in the 3000 world. Allegro Consultants' iAdmin got an update to iOS 7 this month. It supports MPE servers, as well as HP-UX, Solaris, Linux and OS X. iAdmin requires a back-end subscription for each server monitored, just like the HPSCm app. But iAdmin draws its information from a secure server in the cloud; the monitored systems feed their status to that secure server.
HPSCm offers one distinction from independent service arrangements: managers and companies can report they're getting mobile updates via HP itself -- instead of a more focused support company, like Pivital Solutions, which specializes in 3000 issues. Migrated sites have stopped caring about 3000 support, but those who are still mulling over the ideal of using more modern servers might try out the HP app. They can do so if they've already registered monitoring access for servers and such via HP Passport.
July 22, 2014
A Week When HP Gave OpenMPE the Floor
3000 community members at HP's facility for the OpenMPE meeting that replaced the scrubbed HP World 2005. From left, Walt McCullough, HP's Craig Fairchild and Mike Paivinen, Birket Foster (standing) and Stan Sieler.
It was a Maple floor, to be exact, in the Maple Room of the HP campus that's now long-demolished. On this day in 2005, in the wake of a washout of the user group Interex and its conference, the OpenMPE board met with HP to earn a space for an all-day meeting. HP extended use of its Maple Room -- where many a product briefing for the 3000 line had been held -- to the advocacy group that had fought for more time and better programs for migration and homesteading users.
In what feels like a long time ago, given all else that has changed, Interex closed its doors during this week in 2005 owing $4 million to companies small and large. The unpaid debts ranged from individuals owed as little as $8.30 on the unserved part of a yearly membership, to HP World booth sponsors who paid $17,000 for a space that the group could not mount in San Francisco. Then there were the hotels, which lost hundreds of thousands of dollars in unpaid room reservation guarantees. At five creditors to a page, the list of people and companies which the user group owed ran to more than 2,000 sheets. The file at the Santa Clara courthouse felt thick in my hands.
There was little money left at the end, too. The Interex checking account held $5,198.40, and a money market fund had $14,271.64 — neither of which was enough to satisfy the total unpaid compensation for an outside sales rep ($65,604 in unpaid commissions) or executive director Ron Evans (who had to forego his last paycheck of $8,225).
That OpenMPE meeting in August, in place of the Interex show, was notable in way that Interex could never manage. 3000 managers and owners could attend via phone and the web, using meeting software that let them ask questions and see slides while they could hear presentations.Webinars were not uncommon by 2005 for the 3000 community, but this web and phone conference poked further into the realm of interaction by adding the meeting software with the ability to raise your hand for a question, chat between attendees, and more. That same flavor of software, updated for our current decade, is on display at the MB Foster Wednesday Webinars of this year. (The latest is set for August 6.)
HP was gracious enough to provide a lunch for those who attended in person on that August day in 2005. The event was proof of the communication that OpenMPE sparked through its work up to 2008, when the 3000 labs and MPE experts closed off their doors and timesheets.
The meeting of nine years ago included a promise from HP's division managers that it would enable a time-honored tradition of a hobbyist's license for operating systems. It was supposed to give the 3000 community a way to teach itself and experiment with MPE for non-commercial research and education. But HP's method of licensing MPE/iX to the programmers and students of the environment was supposed to use the proposed emulator license, an agreement that required an emulator to surface for HP 3000 hardware.
Alas, the first emulator to surface for the 3000 arrived in 2012, a few years after HP stopped issuing new MPE/iX licenses. There's no hobbyist license per se today from HP. The freeware version of the CHARON emulator makes its users promise they've already got a valid 3000 license, since they've got to enter a HPSUSAN number to get started. A true hobbyist license requires no other OS-hardware license. OpenVMS has a hobbyist license, but that was begun by Digital.
As far as 2005's user group meetings went, the OpenMPE seminar was the only one to follow its proposed schedule. HP said that anybody who'd paid to attend the Interex show could shift their paid registration to the first-ever HP Technology Forum. That event was to be held in New Orleans in the thick of hurricane season. And a whopper emerged, Katrina, which wrecked the city so badly that HP's September show was moved to Orlando.
July 18, 2014
HP gives leadership to Whitman top-down
Hewlett-Packard announced that it's giving the leadership of its board of directors to CEO Meg Whitman, after two chairmen had led the board but not the company in the years following CEO Mark Hurd's ouster.
Whitman joined the HP board in 2011, arriving about five months after Hurd left the company, but she didn't take her CEO role until the fall of that year. She's wrapping up her third year as CEO. Analysts see the addition of chairman to her duties as proof that HP's now her company to lead in totality.
Over the last two decades, only three other people have chaired the HP board as well as held the CEO role: Hurd, Carly Fiorina and Lew Platt. It's usually been an ultimate vote of confidence about a CEO's track record. None of the CEOs began their leadership of the company while heading up the board as well. Platt took his chairman's role from founder David Packard within a year of becoming CEO. Fiorina took the post from Dick Hackborn, 14 months after becoming CEO. Whitman becomes the third woman ever to lead the HP board, following Fiorina and Patricia Dunn. The latter took her job in the wake of Fiorina's ouster.
Leadership of Hewlett-Packard remains an issue for the migrated as well as migrating 3000 customers -- at least those who are investing in HP's alternatives to MPE. Whitman's record since taking her CEO duties has been admirable and at times heroic. She presided over a company in the early winter of 2012 with a stock valued at under $12 a share. In the course of her CEO term, Whitman's weathered the detritus of weak acquisitions such as Autonomy as well as the steep slowing of its services business growth. Whitman voted for Autonomy's acquisition as a board member, early in her directorship. But since 2013 she has championed growth through R&D rather than purchasing companies such as EDS and Compaq.
The board now contains only one longstanding HP employee, Ann Livermore, who serves as executive advisor to Whitman. More than 15 years ago, Livermore was passed over for the CEO job in favor of Fiorina -- but Livermore represents one of the last board members whose pedigree is in technology rather than business management. Livermore has been an HP employee since 1982.
Ralph Whitworth, who's reported to be in poor health, resigned the chairmanship he held since last year to make way for Whitman, as well as vacating his board seat. Klaus Kleinfeld, chairman and chief executive of Alcoa, arrives at the board to take Whitworth's seat.
July 10, 2014
TBT: The month fem-power first led HP
You only have to go back 15 years to find a Throwback Thursday photo that captured watershed change for the HP 3000's creators. Carly Fiorina was named as HP's sixth CEO on a Monday in July, the start of the finale for a company's business way which created Hewlett-Packard-designed products as its biggest business.
Fiorina was all of 44 years old when she took a chair that had always been held by men over the first 60 years of HP's existence. In a BusinessWeek story that marked her ascent, the woman who'd become known only as Carly explained that she'd talked Dick Hackborn into staying on HP's board of directors. Telling readers that "Carly Fiorina has a silver tongue and an iron will," reporter Peter Burrows relayed Carly's own admission of feminine business power. The CEO-to-be said she was interviewed in a Chicago airport club restaurant.
"You can't tell me there's a better person for the job,'' she told Hackborn as the Gaslight's waitresses, clad in skimpy uniforms and fishnet stockings, made their rounds. Over the course of three hours, Hackborn agreed [to helm the board]. ''And no, I did not put on fishnet stockings,'' Fiorina says with a laugh. ''Don't even go there.''
At the time of her ascent, the business media had pegged Carly as the most powerful woman in business, with Oprah running number 2. “She is quite simply the ideal candidate to leverage HP’s core strengths in the rapidly changing information-systems industry and to lead this great company well into the new millennium,” said board member Sam Ginn, who led the search committee. It was a move that would lead the staid company into new eras of panache.
HP’s board said it was pushing for the company’s first outside CEO to lead the company in its new e-services push. Heading up AT&T spinoff Lucent’s $20 billion Global Service Provider division, Fiorina was named America’s Most Powerful Businesswoman in 1998 by Fortune magazine. Her selfies with pop stars came later.Six years later, HP was shucking off a CEO who'd brought exactly what the board thought HP needed -- commodity products to sell alongside high-profit enterprise computing systems. The Compaq merger she pushed, adding PCs to the top of HP's sales results, meant the end of some HP product lines that overlapped with Digital servers that Compaq was selling, such as the OpenVMS-MPE collision.
Within one year of Fiorina's ouster, Burrows had written Backfire, his history of the Carly era at HP. Interviewed on PBS, Burrows gave his take on why the sizzle of a CEO -- who hired pop star Gwen Stefani to headline a tradeshow beside her -- didn't satisfy.
I think she is a very polarizing figure. Initially people almost always, you know, sort of think the world of her and are sort swept away with her charisma and her good ideas and her passion. But I think that over time, a lot of people at HP particularly I know, lost faith when it became clear that her ideas just weren’t working.
Fundamentally, HP was a great printer company and a very average to poor computer company. She went out and did a merger that doubled the size of the poor business, and now they’re stuck in a lousy — a very challenging PC industry.
She got that deal done against all odds, and sort of against the market’s wisdom. Investors hated the deal. They took 17 percent out of the stock immediately when it was announced.
June 12, 2014
Virtualization still demands real iron
In the span of time between the publication of a hopeful magazine article and the close of this year's HP Discover conference, the vendor made a point about its hardware heritage. The point might have been unintentional, but it appears that the future is still a destination you'll achieve riding the vehicle of The Machine.
A lot of computing is going out of sight these days. The costs to careers are real, as companies decide that managing IT staff and in-house resources is a discretionery budget item. When they job out your computing systems to a cloud provider, all that remains is to keep up with the needs of your applications and business processes. That's a lot fewer jobs across our industry. The demands for information keep accelerating, through brontobytes of data and onward.
But HP believes that there's still going to be a need for a machine to run it all, one that they're trying to build from the concepts of tomorrow. A blog post on the HP website HP Next explained why the biggest HP Labs project in 20 years is being called The Machine.
Why do we call it The Machine? When we first started developing it, we wanted to be very careful not to call it a server, workstation, PC, device or phone, because it actually encompasses all of those things. So as we were waiting for Marketing to come up with a cool code name for the project, we started calling it The Machine—and the name stuck.
HP talks about a centralized learning engine. So that's another physical reference, one that will be powered by The Machine. "With The Machine, we have the opportunity to rethink security, data governance, data placement and data sovereignty from ground up and embed them into all of our products. This revolutionary project is on its way to changing the industry—and the way we compute."
The promise, really just a dream, is that a "a doctor could compare your symptoms and genomics with every other patient around the world to improve your health outcomes, instantly, without language barriers or privacy breaches."
That magic will still require real iron somewhere, managed by an IT pro. Iron, a box, or a virtual array of compute engines, they'll all an un-changing part of the way our industry computes. That's why the revolution of a virtual HP 3000 server still needs a ProLiant computer to emulate the old PA-RISC MPE system. That's why even at HP, tomorrow's data dream is called The Machine.
June 11, 2014
HP to spin its R&D future with The Machine
Calling it a mission HP must accomplish because it has no other choice, HP Labs director Martin Fink is announcing a new computer architecture Hewlett-Packard will release within two years or bust. Fink, who was chief of the company's Business Critical Systems unit before being handed the Labs job in 2012, is devoting 75 percent of HP's Labs resources to creating a computer architecture, the first since the company built the Itanium chip family design with Intel during the 1990s.
A BusinessWeek article by Ashlee Vance says the product will utilitize HP breakthroughs in memory (memsistors) and a process to pass data using light, rather than the nanoscopic copper traces employed in today's chips. Fink came to CEO Meg Whitman with the ideal, then convinced her to increase his budget.
Fink and his colleagues decided to pitch Whitman on the idea of assembling all this technology to form the Machine. During a two-hour presentation held a year and a half ago, they laid out how the computer might work, its benefits, and the expectation that about 75 percent of HP Labs personnel would be dedicated to this one project. “At the end, Meg turned to [Chief Financial Officer] Cathie Lesjak and said, ‘Find them more money,’” says John Sontag, the vice president of systems research at HP, who attended the meeting and is in charge of bringing the Machine to life. "People in Labs see this as a once-in-a-lifetime opportunity."
Fast, cheap, persistent memory is at the heart of what HP hopes to change about computing. In the effort to build The Machine, however, the vendor harks back to days when computer makers created their own technology in R&D organizations as a competitive advantage. Commodity engineering can't cross the Big Data gap created by the Internet of Things, HP said at Discover today. The first RISC designs for HP computers, launched in a project called Spectrum, were the last such creation that touched HP's MPE servers.
Itanium never made it to MPE capability. Or perhaps put another way, the environment that drives the 3000-using business never got the renovation which it deserved to use the Intel-HP created architecture. Since The Machine is coming from HP's Labs, it's likely to have little to do with MPE, an OS the vendor walked away from in 2010. The Machine might have an impact on migration targets, but HP wants to change the way computing is considered, away from OS-based strategies. But even that dream is tempered by the reality that The Machine is going to need operating systems -- ones that HP is building.
OS compatibility was one reason that Itanium project didn't pan out the way HP and Intel hoped, of course. By the end of the last decade, Itanium had carved out a place as a specialized product for HP's own environments, as well as an architecture subsidized by Fink's plans to pay Intel to keep developing it. The Machine seems to be reaching for the same kind of "change the world's computing" impact that HP and Intel dreamed about with what it once called the Tahoe project. In a 74-year timeline of HP innovation alongside the BusinessWeek article, those dreams have been revised toward reality.PA-RISC is denoted in a spiraling timeline of HP inventions that is chock-a-block with calculator and printing progress. The HP 2116 predecessor to the HP 3000 gets a visual in 1969, and Itanium chips are chronicled as a 2001 development.
The Machine, should it ever come to the HP product line, would arrive in three to six years, according to the BusinessWeek interview, and Fink isn't being specific about delivery. But with the same chutzpah he displayed in running Business Critical Systems into critical headwinds of sales and customer retention, he believes HP is the best place for tech talent to try to remake computing architecture.
According to the article, three operating systems are in design to use the architecture, one open-source and HP proprietary, another a variant of Linux, and a third based on Android for mobile dreams. That's the same number of OS versions HP supported for its first line of computers -- RTE for real time, MPE for business, and HP-UX for engineering, and later business. OS design, once an HP staple, need to reach much higher to meet the potential for new memory -- in the same way that MPE XL made use of innovative memory in PA-RISC.
Fink says these projects have burnished HP’s reputation among engineers and helped its recruiting. “If you want to really rethink computing architecture, we’re the only game in town now,” he said. Greg Papadopoulos, a partner at the venture capital firm New Enterprise Associates, warns that the OS development alone will be a massive effort. “Operating systems have not been taught what to do with all of this memory, and HP will have to get very creative,” he says. “Things like the chips from Intel just never anticipated this.”
June 10, 2014
Security patches afloat for UX, for a price
If an IT manager had the same budget for patches they employed while administering an HP 3000, today they'd have no patches at all for HP's Unix replacement system. That became even more plain when the latest Distributed Denial of Service (DDoS) alert showed up in my email. You never needed a budget to apply any patches while HP 3000s were for sale from the vendor. Now HP's current policy will be having an impact on the value of used systems -- if they're Unix-based, or Windows ProLiant replacements for a 3000. Any system's going to require a support contract for patches.
For more than 15 years, HP's been able to notify customers when any security breach puts its enterprise products at risk. For more than five years, one DDoS exploit after another has triggered these emails. But over the past year, Hewlett-Packard has insisted that a security hole is a good reason to pay for a support contract with the vendor.
The HP 3000 manager has better luck in this regard than HP's Unix system owners. Patches for the MPE/iX environment, even in their state of advancing age, are distributed without charge. A manager needs to call HP and be deliberate to get a patch. The magic incantation when dealing with the Response Center folks is to use transfer code 798. That’ll get you to an MPE person. And there's not an easy way for an independent support company to help in the distribution, either. HP insisted on that during a legal action last spring.
In that matter, a support company -- one that is deep enough to be hiring experts away from HP's support team -- was sued for illegal distribution of HP server patches. HP charged copyright infringement because the service company had downloaded patches -- and HP claimed those patches were redistributed to the company's clients.
The patch policy is something to budget for while planning a migration. Some HP 3000 managers haven't had an HP support contract since the turn of this century. Moving to HP-UX will demand one, even if a more-competent indie firm is available to service HP-UX or even Windows on a ProLiant system. See, even the firmware patches aren't free anymore. Windows security patches continue to be free -- that is, they don't require a separate contract. Not even for Windows XP, although that environment has been obsoleted by Microsoft.HP said the lawsuit was resolved when the support company agreed to suspend their practices that were alleged in the suit.
HP, like Oracle (owners of Sun) and other OS manufacturers, have chosen to restrict updates, patches, and now firmware to only those customers that have a current support agreement. Indie support companies can recommend patches; in fact, they're a great resource for figuring out which patch will fix problems without breaking much else. But customers are required to have their own support agreement in order to download and install such patches and updates.
Even following the links in the latest HP emails landed me in a "you don't have a support agreement to read this" message, rather than the update about DDoS exposure. It's more than the patches for migration platforms that HP's walled away from the customer base. Now even the basic details of what's at risk are behind support paywalls.
The extra cost is likely to be felt most in the low to midrange end of the user community. Dell's not getting caught up in what HP calls an industry trend to charge for repairing malformed software or OS installations that get put at risk. Dell offers unrestricted access to BIOS and software updates for its entire server, storage, and networking line.
June 05, 2014
A World Where Amazon Trumps Big Blue
It almost sounds like grandpa-talk to say "things have changed so much." Life is built from changes, and since our industry runs at a pace faster than almost every other, our rate of change is exemplary. There are long-held rules that are giving way, too.
Most of the HP 3000 managers remember the saying that "nobody ever got fired for buying IBM." It was an unfair advantage. Big Blue was the default IT choice for most of the 3000's lifespan as an HP product. But during the decade-plus since MPE started to vanish from Hewlett-Packard's mindscape, IT hosting and computing resource defaults have been reset. The changes are serious enough that Amazon trumped IBM on a $600 million project to build a compute center for the CIA.
Unlike the NSA (No Such Agency), the CIA exists and processes countless pieces of information. A story in BusinessWeek reported that the CIA wanted to build its own private cloud computing system. This is the type of IT project that would've been handled on the ground, not in the cloud, while HP was selling 3000s. A type of project IBM would've been a finalist in. Indeed, IBM finished in the top two. But IT pros now live in a world where buying compute power with a credit card is a valid strategy. The stakes were high for the winner.
For the bidders, more was at stake than a piece of the lucrative federal IT market. Whoever won the 10-year, $600 million contract could boast that its technology met the highest standards, with the tightest security, at the most competitive prices, at a time when customers of all kinds were beginning to spend more on data and analytics.
The CIA awarded the contract to Amazon.com. The e-commerce company had persuaded the spymasters that its public cloud could be replicated within the CIA’s walls. Amazon had been bleeding IBM for years—its rent-a-server-with-your-credit-card model was a direct threat to IBM’s IT outsourcing business—but this was different. Amazon beat IBM for a plum contract on something like its home turf, and it hadn’t done so simply by undercutting IBM on price. IBM learned that its bid was more than a third cheaper than Amazon’s and officially protested the CIA decision.
The 3000 community lives in a world where cloud computing is being selected for large-scale projects -- and it's being chosen from companies like Amazon who don't have the ballast to carry you'll see from HP, IBM, Dell or others. The servers, and the expertise to make them sparkle, work elsewhere. HP's got a cloud offering, as does IBM. But Amazon Web Services is way ahead of these classic server providers. IBM's gotten so far off the server sales strategy that it sold its low-end servers group to Lenovo.
To put it another way, IBM's selling as many small servers this year as HP is selling 3000s.
In the BusinessWeek story, the demise of IBM being fireproof got exploded. At least while going up against Amazon.
A federal judge agreed, ruling in October that with the “overall inferiority of its proposal,” IBM “lacked any chance of winning” the contract. The corporate cliché of the 1970s and ’80s, that no one ever got fired for buying IBM, had never seemed less true. IBM withdrew its challenge.
May 29, 2014
They knew what they had before it was gone
In the classic Joni Mitchell song, she asks, "Don't it always seem to go, you don't know what you got 'till it's gone?" However, in the HP 3000 world, the advocates, fans and users know the special place the 3000 held in their lives -- and long before it was really gone.
At the now-defunct Boyle Engineering, the last in a long line of HP 3000s was sold for scrap this month, according to Harlan Lassiter. When Boyle was purchased in 2008, the site that housed the 3000 was closed down. Equipment was left behind, but Lassiter -- who worked at Boyle 27 years -- kept track of an abandoned 3000 Series 928. He reported he was sad to see it go. One last boot-up was all that Lassiter wanted at Boyle, whose services were engaged to plan, design, and construct infrastructure projects.
Last time I was in the building, in the corner of the raised floor computer room, was our HP 3000 928 system, console monitor and LPQ1200 printer. Yesterday it was gone. Apparently it was picked up late last week as scrap. Also picked up and sold for scrap from the room were about 50 Dell LCD monitors (some new, still in bubble wrap) and perhaps 30 Dell desktop computers, APC battery backup systems, server arrays, and other assorted computer equipment. Much of the equipment could have been donated to organizations that could use a computer system, even though it would not be the most current.
That 928 was the last in a series of HP 3000 systems for the company, having begun with a Series II when I first started with Boyle in 1979 . We came a long way. I started as a programmer and left as the system manager. The system ran all of the company in-house accounting, finance, payroll and project tracking reports and engineering software. All software was developed in-house and was written in FORTRAN. As FORTRAN evolved through the years, so did the software. Files were converted from serial (flat) files to KSAM and eventually to IMAGE databases. What used to take overnight to process took less than an hour in later days.
It was a great learning experience. I guess I was hoping to fire the system up one more time just for nostalgia's sake, since I am the only one left that would be able to do such a thing.
Another piece of HP history, a living one that served both the 3000 and HP-UX systems, has been bulldozed, right off the ground of the old Hewlett-Packard Cupertino campus.Apple now owns the acres of Cupertino where the HP 3000 grew into a business powerhouse. The HP buildings have been razed, and Jim Hawkins of HP reports that even the grove of redwood trees is no more. Apple's building a spaceship-like headquarters in its place. Employees and retirees held picnics there, along with the historic Glendenning Barn which HP maintained as a reminder of the property’s pioneer-era life as an apricot orchard and farm. Hawkins, one of the last 3000-focused engineers at Hewlett-Packard, celebrated those redwoods as a place of the 3000 community.
The HP Cupertino Site, home for (most of) the HP 3000 R&D teams, and manufacturing source of (most) pre-RISC MPE servers, is now scraped clean in preparation to land Apple's "Steve Jobs memorial spaceship."
The redwood grove where execs used to serve us hamburgers during beer busts is all cut down, as are apparently all other trees except those on the borders of Pruneridge, Wolfe, Homestead, and Tantau streets.
After reading Lassiter's farewell, Ed Effinger shared a memorial in waiting. His was report of a forthcoming shutdown at Conestoga College in Kitchener, Ontario. "We have a similar story to what mine will be next March," Effinger said, "as we plan to pull the plug on our Series 929. We also started with HP in 1975-76, to replace our old Honeywell system -- and I too have done all things here."
These are customers of more than 35 years of MPE computing, and that redwood grove was servicing the community at HP's campus even before that time. At least these veterans of the ecosystem know what they're losing, and how much that loss stings. At the old HP campus, it looks like Apple's paving paradise to put up a an underground parking lot.
May 27, 2014
Does cleaning out HP desks lift its futures?
Migration sites in the 3000 community have a stake in the fortunes of Hewlett-Packard. We're not just talking about the companies that already have made their transition away from MPE and the 3000. The customers who know they're not going to end this decade with a 3000 are watching the vendor's transformation this year, and over the next, too.
It's a period when a company that got bloated to more that 340,000 companies will see its workforce cut to below 300,000 when all of the desks are cleaned out. The HP CEO noted that the vendor has been through massive change in the period while HP was cleaning out its HP 3000 desks. During the last decade, Meg Whitman pointed out last week, Compaq, EDS, Automomy, Mercury Interactive, Palm -- all became Hewlett-Packard properties. Whitman isn't divesting these companies, but the company will be shucking off 50 percent more jobs than first planned.
Some rewards arrived in the confidence of the shareholders since the announcement of 16,000 extra layoffs. HP stock is now trading at a 52-week high. It's actually priced at about the same value as the days after Mark Hurd was served walking papers in 2010. Whitman's had to do yeoman work in cost-cutting to keep the balance sheet from bleeding, because there's been no measureable sales growth since all 3000 operations ceased. It's a coincidence, yes, but that's also a marker the 3000 customer can recall easily.
When you're cutting out 50,000 jobs -- the grand total HP will lay off by the end of fiscal 2015 in October of next year -- there's no assured way of retaining key talent. Whitman said during the analyst conference call that everybody in HP has the same experience during these cuts. "Everyone understands the turnaround we're in," she said, "and everyone understands the market realities. I don't think anyone likes this."
These are professionals working for one of the largest computer companies in the world. They know how to keep their heads down in the trenches. But if you're in a position to make a change in your career, a shift away from a company like HP that's producing black ink on its ledger through cuts, you want to engage in work you like -- by moving toward security. In the near term, HP shareholders are betting that security will be attained by the prospect of a $128 billion company becoming nimble, as Whitman vowed last week.In truth, becoming nimble isn't going to be as important to an HP enterprise customer as becoming innovative. Analysts are identifying cloud computing as the next frontier, one that's already got profitable outposts and the kind of big-name users HP's always counted in its corral. During an interview with NPR on the day after the job cuts rolled out, Michael Regan of Bloomberg News pointed out that most of HP's businesses have either slipped, like printers and PCs, or are under fire.
Servers are under a really big threat from cloud computing. HP formerly, you know, their business was to sell you the server so that you can store all your data yourself and have customers access the data right off of your server from the Internet.
The big shift over the last few years has been to put it on a cloud, where basically companies are renting space on a server, and consumers a lot of times aren't even buying any Web applications. They're renting them over the cloud, too. All three of [HP's] main business lines are really under a lot of competition from tablets and cloud computing.
This isn't good news for any customer whose IT career has been built around server management and application development and maintenance. Something will be replacing those in-house servers at any company that will permit change to overturn its technology strategy.
Cloud computing is a likely bet to replace traditional server architectures at companies using the HP gear. But it's a gamble right now to believe that HP's strength in traditional computing will translate to any dominance in cloud alternatives. IBM and Amazon and Google are farther in front on these offerings. That's especially true for the small to midsize company where an HP 3000 is likely to remain working this year.
During the NPR interview, Regan took note of the good work that's come from Whitman's command of the listing HP ship. But the stock price recovery is actually behind both the Standard & Poors average and the average for technology firms during Whitman's tenure. She's floating desks out the door, but that probably won't be enough to float the growth trend line upward. When extra cuts are needed to keep all those shareholders happy, one drooping branch could be the non-industry standard server business.
Any deeper investment in any HP strategy that relies on catching up with non-standard technology should float away from procurement desks for now.
May 22, 2014
HP's migration servers stand ground in Q2
The decline of HP's 3000 replacement products has halted
(click on graphic for details)
CEO Meg Whitman's 10th quarterly report today promised "HP's turnaround remains on track." So long as that turnaround simply must maintain sales levels, she's talking truth to investors. During a one-hour conference call, the vendor reported that its company-wide earnings before taxes had actually climbed by $240 million versus last year's second quarter. The Q2 2014 numbers also show that the quarter-to-quarter bleeding of the Business Critical Systems products has stopped.
But despite that numerical proof, Whitman and HP have already categorized BCS, home of the Linux and HP-UX replacement systems for 3000, as a shrinking business. The $230 million in Q2 sales from BCS represent "an expected decline." And with that, the CEO added that Hewlett-Packard believes its strategy for enterprise servers "has put this business on the right path."
The increased overall earnings for the quarter can be traced to a robust period for HP printers and PCs. Enterprise businesses -- the support and systems groups that engage with current or former 3000 users -- saw profits drop by more than 10 percent. HP BCS sales also fell, by 14 percent versus last year's Q2. But for the first time in years, the numbers hadn't dropped below the previous quarter's report.
The decline of enterprise server profits and sales isn't a new aspect of the HP picture. But the vendor also announced an new round of an extra 10,000-15,000 job eliminations. "We have to make HP a more nimble company," Whitman said. CFO Cathie Lesjack added that competing requires "lean organizations with a focus on strong performance management." The company started cutting jobs in 2012, and what it calls restructuring will eliminate up to 50,000 jobs before it's over in 2015.
Enterprise business remains at the heart of Hewlett-Packard's plans. It's true enough that the vendor noted the Enterprise Systems Group "revenue was lower than expected" even before the announcement of $27.3 billion overall Q2 revenues. The ESG disappointments appeared to be used to explain stalled HP sales growth.
But those stalled results are remarkable when considered against what Whitman inherited more than two years ago. Within a year, HP bottomed out its stock price at under $12 a share. It was fighting with an acquired Autonomy about how much the purchased company was worth, and was shucking off a purchase of Palm that would have put the vendor into the mobile systems derby.
If nothing else, Whitman's tenure as CEO -- now already half as long as Mark Hurd's -- contains none of the hubris and allegations of the Hurd mentality. After 32 months on the job, Whitman has faced what analysts are starting to call the glass cliff -- a desperate job leading a company working its way back from the brink, offered to a woman.As the conference call opened on May 22, HP's stock was trading at close to three times its value during that darkest month of November, 2012. At $31 a share valuation, HPQ is still paying a dividend to shareholders. Meanwhile, the company said it has "a bias toward share repurchases" planned for the quarters to come.
There's still plenty of profit at HP. But the profits for the Enterprise Group, which includes blades and everything that runs an alternative to MPE, have been on a steady decline. A year ago before taxes they were $1.07 billion, last quarter they were $1 billion, and this quarter they're $961 million. Sales are tracking on the same trajectory.
Whitman noted the tough marketplace for selling its business servers in the current market. She also expressed faith in HP's system offerings. It's just that the vendor will have to offer them with fewer employees.
"I really like our product lineup. But we need to run this company more efficiently," she said. "We're going to have to be quicker and faster to compete in this new world order."
When an analyst asked Whitman about morale in the face of job cuts, she said people at HP understand the economic climate.
"No company likes to decrease the workforce," she said. "Our employees live with it every single day. Everyone understands the turnaround we're in, everyone understands the market realities. I don't think anyone likes this." HP believes the extra job cuts will free up an additional $1 billion a year, "and some of that will be reinvested back into the business."
There's also money being spent in R&D. At first during the Q&A session, the CFO Lesjack said that "the increase of R&D year over year is very broad-based" across many product lines. Whitman immediately added that there have been increases for R&D in HP's server lines. The servers which HP is able to sell are "mission-critical x86" systems. That's represents another report that the Integrity-based lineup continues to decline. BCS overall represents just 3 percent of all Enterprise Systems sales in this quarter.
HP's internal enterprise systems -- which were once managed by HP 3000s -- are in the process of a new round of replacements. SAP replaced internal systems at HP last decade. Whitman said the churn that started in 2001 with the Compaq purchase has put the vendor through significant changes, ones that HP must manage better.
"This company has been through a lot," Whitman said during analyst questioning. "The acquisition of Compaq. The acquisition of EDS. Eleven to 20 software acquisitions. It's a lot of change. We're putting in new ERP programs and technology to automate processes that frankly, have not been done in awhile."
May 20, 2014
Who's SUSAN, and what's her CPUNAME?
The MPE operating system, first booted for genuine use some 40 years ago, is a most unique creature of the computer ecosystem. This is software that does not have its own license, specifically. According to HP, the ownership of any MPE/iX version is determined by owning an Hewlett-Packard 3000 server, one built to boot up MPE/iX.
We reached out for clarity about this when a very large aircraft maker tipped us off -- once again, it will examine replacing HP's 3000 iron with CHARON licenses on Intel systems. After the MPE/iX software is turned off on any replaced 3000 hardware, does its hardware-based license then expire? The operating system license, according to HP's MPE Technical Consultant Cathlene Mc Rae, is related to the HPSUSAN of the original HP hardware.
So wait a minute. Are these HPSUSAN numbers of 3000s considered de-licensed, even if they're going to be used on the CHARON emulator? Mc Rae explained.
The HPSUSAN number is different from the MPE/iX license, although there is a relation between the two. The ability to use MPE/iX on the emulator is a result of completing a Software License Transfer. The original MPE/iX license on the HP e3000 would then no longer exist.
In the hardware world of HP 3000s, HPSUSAN takes the original serial and model numbers on the system. It remains the same, as long as the customer owns the system. This combination was used to ID the hardware and enable diagnostics for the correct system.
However, that transferred license for the MPE/iX installation on the CHARON emulator -- available via a $432 Software License Transfer Fee -- won't be getting a new HPSUSAN number during the process. HPSUSAN gets re-used, and so it leads us to see what HPSUSAN stands for, and how the HPCPUNAME is a key in emulator installations.The U in HPSUSAN stands for Unique, as in System Unique Serially Assigned Number. Mc Rae said that HPSUSAN is one of a kind for HP-built 3000 systems. But SUSAN doesn't designate an MPE/iX license, even though MPE is licensed via hardware ownership.
Mc Rae explained to us, and to the CHARON prospective user, "MPE hardware and software was created before the technology of virtual systems and emulators, in the 1970s. Licenses were based on hardware ownership."
This sounds familiar. HP once compared the licensing of MPE/iX to license plates issued for a car. They could not be separated, these numbers and the car that was the HP 3000 iron. (Let's just put aside the common practice of those metal-plate days, when they'd give you a new number after your plate was older than 8 years in Texas.)
In 1999, HP was busy suing Hardware House and a few other resellers over the resellers' separation of HPSUSANs from HP's 3000 hardware cars. The House was taking other PA-RISC servers and pressing valid HPSUSAN numbers onto the non-3000 iron. People went to jail. Lo-jacks were ordered for ankles.
Thanks to the passage of 15 years' time, an HPSUSAN number can now move to a USB thumb drive plugged into a CHARON Intel- or AMD-based server. Those license plates can travel to a newer model of car. The emulator's HPCPUNAME, however, can only be designated as an A-Class or N-Class system, according to HP's knowledge. That'll likely be a reason to contact all software vendors whose products operate on the replaced HP 3000 iron.
You see, vendors use a combo of HPSUSAN and HPCPUNAME to control licensing. Products such as Infor's MANMAN or PowerHouse not only want to read HPSUSAN -- which you can move to CHARON -- but also HPCPUNAME. If you're moving off a Series 979, for example, "979-100" isn't an emulated system under CHARON. No 979-100 for HPCPUNAME. You've got to get license permission from your software vendors to enable an A-Class or N-Class HPCPUNAME.
The HPCPUNAME on the CHARON system may not be set to 979, Mc Rae said. "Based on the CHARON HPA/3000 family, it is assumed that the HPCPUNAME will be set to an A-Class or N-Class CPUNAME," she said. "For example: HPCPUNAME = SERIES e3000/A500-200-50. As far as I know, CHARON can only emulate A- and N-Class systems." That's true: a Series 9xx model isn't on the HPA/3000 product list.
The silver lining in this cloud is that you're only doing this contacting and CPUNAME-changing once. Moving to an A-Class or faster CPU from a 9x9 system is the last time you'll be changing from an unsupported CPUNAME to something included in the CHARON product line.
In short, independent software vendors are going to have to be contacted, if they've licensed their products with the HPCPUNAME-HPSUSAN combo on a Series 9xx. Contacting your software vendors about a system upgrade is a fair business practice. But it's more than the right thing to do. Series 9xx users headed to the emulator look like they need that refresh to boot up their indie software.
May 09, 2014
HP bets "Hey! You'll, get onto your cloud!"
Hewlett-Packard announced that it will spend $1 billion over the next two years to help its customers built private cloud computing. Private clouds will need security, and they'll begin to behave more like the HP 3000 world everybody knows: management of internal resources. The difference will reside in a standard open source stack, OpenStack. It's not aimed at midsize or smaller firms. But aiding OpenStack might help open some minds about why clouds can be simple to build, as well as feature-rich.
This is an idea that still needs to lift off. Among the 3000 managers we interview, there are few who've been in computing since the 1980s who are inclined to think of clouds much differently than time-sharing, or apps over the Internet. Clouds are still things in Rolling Stones or Judy Collins choruses.
The 3000 community that's moving still isn't embracing any ideal of running clouds in a serious way. Once vendor who's teeing up cloud computing as the next big hit is Kenandy. That's the company built around the IT experience and expertise of the creators of MANMAN. They've called their software social ERP, in part because it embraces the information exchange that happens on that social network level.
But from the viewpoint of Terry Floyd, founder of the manufacturing services firm The Support Group, Kenandy's still waiting for somebody from the 3000 world to hit that teed-up ball. Kenandy was on hand at the Computer History Museum for the last HP3000 Reunion. That gathering of companies now looks like the wrong size of ball to hit the Kenandy cloud ERP ball.
"Since we saw them at the Computer History Museum meeting, Kenandy seems to have has re-focused on large Fortune 1000 companies," Floyd said. There are scores of HP 3000 sites running MANMAN. But very few are measuring up as F1000 enterprises. Kenandy looks like it believes the typical 3000 site is not big enough to benefit from riding a cloud. There are many migrated companies who'd fit into that Fortune 1000 field. But then, they've already chosen their replacements.The Kenandy solution relies on the force.com private cloud, operated by Salesforce.com. Smaller companies, the size of 3000 customers, use Salesforce. The vendor's got a force.com cloud for apps beyond CRM. But the magnitude of the commitment to Kenandy seems larger than the size of the remaining 3000 sites which manufacture using Infor's MANMAN app.
"Most MANMAN sites don't meet their size requirements," Floyd said. "I have a site that wants to consider Kenandy next year, but so far Kenandy is not very interested. We'll see if they are serious when the project kicks off next year, because we think Kenandy is a good fit for them."
The longer that small companies wait out such cloud developments as HP's $500 million per year, the better the value becomes for getting onto their cloud, migrating datacenter ops outside company walls. HP is investing to convince companies to build their own private clouds, instead of renting software from firms like Kenandy and Salesforce. Floyd and his company have said there's good value in switching to cloud-based ERP for some customers. Customization of the app becomes the most expensive issue.
This is the central decision in migrating to cloud-based ERP from a 3000. It's more important than how much the hardware to support the cloud will cost. HP's teaming up with Foxconn -- insert snarky joke here -- to drive down the expense of putting up cloud-optimized servers. But that venture is aimed at telecommunications companies and Internet service providers. When Comcast and Verizon, or Orange in Europe, are your targets, you know there's a size requirement.
You might think of the requirements for this sort of cloud -- something a customer would need to devote intense administrative resources to -- as that sign at the front of the best amusement park rides. "You must be Fortune 1000 tall to ride this ride," it might say. Maybe, over the period of HP's new cloud push, the number on the sign will get smaller.
April 08, 2014
Here it is: another beginning in an ending
Today's the day that Microsoft gives up its Windows XP business, but just like the HP 3000 exit at Hewlett-Packard, the vendor is conflicted. No more patches for security holes, say the Redmond wizards. But you can still get support, now for a fee, if you're a certain kind of Windows XP user.
It all recalls the situation of January 2009, when the support caliber for MPE/iX was supposed to become marginal. That might have been true for the typical kind of customer who, like the average business XP user, won't be paying anything to Microsoft for Service Packs that used to be free. But in 2009 the other, bigger sort of user was still paying HP to take 3000 support calls, fix problems, and even engineer patches if needed.
A lot of those bigger companies would've done better buying support from smaller sources. Yesterday we took note of a problem with MPE/iX and its PAUSE function in jobstreams, uncovered by Tracy Johnson at Measurement Specialties. In less than a day, a patch that seemed to be as missing as that free XP support of April 8 became available -- from an independent support vendor. What's likely to happen for XP users is the same kind of after-market service the 3000 homesteader has enjoyed.
Johnson even pointed us to a view of the XP situation and how closely it seems to mirror the MPE "end of life," as Hewlett-Packard liked to call the end of 2010. "Just substitute HP for Microsoft," Johnson said about a comparison with makers of copiers and makers of operating systems.Should Microsoft Be Required To Extend Support For Windows XP? The question is being batted around on the Slashdot website today. One commenter said that if the software industry had to stick to the rules for the rest of the office equippers, things would be differerent. Remember, just substiture HP (and MPE) for Microsoft and XP.
If Windows XP were a photocopier, Microsoft would have a duty to deal with competitors who sought to provide aftermarket support. A new article in the Michigan Law Review argues that Microsoft should be held to the same duty, and should be legally obligated to help competitors who wish to continue to provide security updates for the aging operating system, even if that means allowing them to access and use Windows XP's sourcecode.
HP did, given enough time, help in a modest way to preserve the maintainability of MPE/iX. The vendor sold source code licenses for $10,000 each to support companies. In at least one case, the offer of help was proactive. Steve Suraci of Pivital Solutions said he was called by Alvina Nishimoto of HP and asked, "You want to purchase one of these, don't you?" The answer was yes. Nobody knew what good a source code license might do in the after-market. But HP was not likely to make the offer twice, and the companies who got one took on the expense as an investment in support in the future.
But there was a time in the 3000's run-up to that end-of-HP Support when the community wanted to take MPE/iX into open source status. That's why the advocacy group was named OpenMPE. Another XP commenter on Slashdot echoed the situation the 3000 faced during the first years of its afterlife countdown.
(Once again, just substitute HP and MPE for Microsoft and XP. In plenty of places, they'll be used together for years to come.)
XP isn't all that old, as evidenced by the number of users who don't want to get off of it. It makes sense that Microsoft wants to get rid of it -- there's no price for a support contract that would make it mutually beneficial to keep tech support trained on it and developers dedicated to working on it. But at the same time, Microsoft is not the kind of company that is likely to release it to the public domain either. The last thing they would want is an open source community picking it up, keeping it current with security patches and making it work on new hardware. That's the antithesis of the forced upgrade model.
Note: MPE/iX has been made to work with new hardware via the CHARON emulator. Patches are being written, too, even if they are of the binary variety. XP will hope to be so lucky, and it's likely to be. If not, there's the migration to Windows 7 to endure. But to avoid that expense for now, patches are likely to be required. The 3000 community can build many of them. That's what happens when a technology establishes reliability and matures.
April 07, 2014
MPE patches still available, just customized
Last week a 3000 manager was probing for the cause of a Command Interface CI error on a jobstream. In the course of the quest, an MPE expert made an important point: Patches to repair such MPE/iX bugs are still available. Especially from the seven companies which licensed HP's source code for the HP 3000s.
This mention of MPE bug repair was a reminder, actually, that Hewlett-Packard set the internals knowledge of MPE free back in 2010. Read-only rights to the operating system source code went out to seven companies worldwide, including some support providers such as Pivital Solutions and Allegro Consultants.
The latter's Stan Sieler was watching a 3000 newsgroup thread about the error winding up. Tracy Johnson, the curator of the 3000 that hosts the EMPIRE game and a former secretary to OpenMPE, had pointed out that his 3000 sometimes waits longer than expected after a PAUSE in a jobstream.
I nearly always put a CONTINUE statement before a PAUSE in any job. Over the years I have discovered that sometimes the CPU waits "longer" than the specified pause and fails with an error.
A lively newsgroup discussion of 28 messages ensued. It was by far the biggest exchange of tech advice on the newsgroup in 2014, so far. Sieler took note of what's likely to be broken in MPE/iX 7.5, after an HP engineer had made his analysis of might need a workaround. Patches and workarounds are a continuing part of the 3000 manager's life, even here in the second decade of the 3000's Afterlife. You can get 'em if you want 'em.A workaround is the more likely of repairs for something that's not operating correctly in MPE, by this year. Patches were a free HP 3000 element, and those that HP created still are free today -- unlike the situation for HP's still-supported servers. The dilemma is that the final round of patches HP built weren't tested to HP's satisfaction. Plus, there's no more vendor work on new repairs.
Enter the third party supporters, the companies I call independent support providers. They know the 3000 as well as anybody left at HP, so long as they're a party to the source code for the operating system. In many cases, a binary patch isn't what a customer wants. Such a thing has to be tested, and a lot of production 3000s are under lockdown today. Changes are not invited.
But in the case of an MPE/iX jobstream PAUSE error, there's always a chance for a fix. HP's Jim Hawkins looked at Johnson's problem and ranked the causes Nos. 1-4. Number 4 was "possible MPE/iX bug."
Sieler said that it looked like this was a genuine MPE/iX flaw. What to do, now that the MPE/iX lab at HP -- which once included Hawkins -- has gone dark? Sieler pointed to patching.
After analyzing hxpause, the executor responsible for implementing the CI PAUSE command, I suspect there is a bug in the MPE/iX internal routine "pausey", which hxpause uses. The bug appears to be triggerable by :BREAKJOB/:RESUMEJOB, but I have not characterized precisely what triggers it. It is, however, apparently the result of the equivalent of an uninitialized variable.
I believe Allegro could develop a patch, should a customer be interested in it.
Patches beyond the lifespan of an HP lab are a touchy topic. A binary patch, as Allegro's Steve Cooper describes this kind of assignment, is likely to live its life in just one HP 3000 installation. It's a creation to be tested, like any patch.
And now it seems that patches are not only a for-pay item, but something to be guarded. HP even pressed a lawsuit against an independent company when the vendor observed that its patches were being distributed by the indie. No money changed hands in the suit settlement, but the support company said it would stop redistributing HP's patches.
This kind of protective culture from systems vendors is endemic by now, according to Source Direct's Bill Hassell. "This is a hot topic, both for customers as well as third party support organizations," he reported. "There have been very strong reactions from customers to recent statements about firmware restrictions." Hassell, well-known as an HP-UX expert among former Interex user group members, pointed to a handful of articles from HP's own blog and the industry press such as ZDNet, or one from PC World.
But the first one Hassell pointed at was the message from HP's own Mary McCoy, VP of Support for HP Servers, Technology Services. It's titled Customers for Life. In essence, the February posting says HP's firmware only gets an upgrade for "customers with a valid warranty, Care Pack Service, or support agreement."
We know this is a change from how we’ve done business in the past; however, this aligns with industry best practices and is the right decision for our customers and partners. This decision reinforces our goal to provide access to the latest HP firmware, which is valuable intellectual property, for our customers who have chosen to maximize and protect their IT investments.
In the face of this, and other HP announcements such as ProLiant patch availability, the customers who are commenting at HP's website are not happy. One noted that "the customer segment who will suffer the most from this revision in HP firmware availability will be the small and medium businesses performing their own in-house IT support." Some say the pay-for-patch mandate is only going to drive them to other vendors for small business servers. HP asserts that every vendor is doing this by now.
Enter the indie patching potential for MPE/iX. Binary patches are much more of a possibility when source code is in the hands of a support company. As far as I know, the source for HP-UX, or any other proprietary Unix, isn't in the wild, and the same can be said for Windows. Linux source is always available, of course. Nobody is going to be tagged as a Customer for Life when they choose Linux.
But that's also true of MPE/iX. Enter an indie support relationship and you get the benefits of that vendor's expertise, based upon the level of their understanding of MPE. Leave that relationship and you're not penalized. You're just on the hunt now for another support vendor of equal caliber.
A support company's caliber is measured by the way it conducts its business practices, not just what it knows how to create or fix. This vendor lock-in is something familiar to a 3000 owner. But it was technology, not business decisions, which enforced such lock-in during the 20th Century. The indie companies have a patch for the current era's lock-in error.
March 21, 2014
Shadows of IT Leaders, at HP and Apple
Earlier this week, the Reverend Jesse Jackson made an appearance at Hewlett-Packard's annual shareholder meeting. He used the occasion of a $128 billion company's face-up to stockholders to complain about racial bias. In specific, Jackson complained that the HP board, by now, should have at least one African American serving on it.
HP's CEO Meg Whitman took respectful note of Jackson's observation, which is true. After 75 years of corporate history that have seen the US eliminate Jim Crow, and the world shun apartheid, HP's board is still a collection of white faces (10 of 12). Hewlett-Packard always had a board of directors, but it didn't become a company with a board in public until it first offered shares in 1958. We might give the company a pass on its first 20 years, striving to become stable and powerful. But from the '60s onward, the chances and good people might have been out there. Just not on HP's board, as Jackson pointed out.
But that story about the vendor who created your HP 3000s, MPE, IMAGE and then the systems to replace all, is incomplete. It's just one view of what Hewlett-Packard has become. In spite of Jackson's accurate census, it overlooks another reality about the company's leadership. HP has become woman-led, in some of its most powerful positions. Whitman had the restraint to not to point to that. But she's the second woman over those 75 years to be HP CEO.
Companies with potent histories like HP will always be in the line of fire of misunderstanding. The same sort of thing happed to Apple this week. This rival to HP's laptop and desktop and mobile space was inked over as a company still run by the ghost of its founder Steve Jobs. Like the Jackson measurement of HP's racial diversity at the top, the Ghostly Jobs Apple story needs some revisions. HP's got diversity through all of its ranks right up until you get to the director level. Given what a miserable job the board's done during the last 10 years, it might be a good resume item to say "Not a Member of Hewlett-Packard's Board."
Regarding Apple, the misunderstanding is being promoted in the book Haunted Empire. The book that's been roundly panned in reviews might sell as well as the Steve Jobs biography by Walter Issacson, but for the opposite reasons. Jobs' biography was considered a hagiography by anybody who disliked the ideal of Apple and "Computing for the Rest of Us." He indeed acted like a saint in the eyes of many of his customers, and now that very sainthood is being devolved into a boat anchor by the writer of Haunted Empire. It doesn't turn out to be true, if you measure anything except whether there's been a game-changer like a tablet in the past four years.
Similar things happened to Bill Hewlett and Dave Packard after Hewlett died in 2001, leaving HP with just the "HP Way" and no living founders. Whatever didn't happen, or did, was something the founders would've fought for, or wouldn't have tolerated. The Way was so ingrained into the timber of HP that the CEO who preceded Whitman, Leo Apotheker, imagined there might be a Way 2.0. Tying today to yesterday can be a complicated story. There was an HP Way 0.5, according to Michael Malone's history of HP, Bill and Dave.
And the term "Bill and Dave" is invoked to this day by people as disappointed in 2014's Hewlett-Packard as Jackson is impatient with its diversity. Like the Ghostly Apple story, WWBDD -- What Would Bill and Dave Do -- can be told with missing information. Accepting such missing data is a good way to show you know the genuine HP Way. Or if you care, the correct state of the Apple Empire.Since my reader will care far more about WWBDD, let's just move to Malone's book, well-reviewed and available for the cost of shipping alone. Under the section An Army of Owners, he outlines the discounted HP employee stock ownership, one product of the Way.
One of the least-noticed aspects of Hewlett's and Packard's managerial genius was their ability to hide shrewd business strategy inside of benevolent employee programs, and enlightened employee benefits within smart business programs -- often at the same time.
Having so much company stock in the hands of HP employees ultimately meant that Bill and Dave could resist any pressure from Wall Street to substitute short-term gains for long-term success.
Malone goes on to note that employee stock purchasing gave Bill and Dave a great engine to make cash, as well as keep lots of stock out of the hands of institutional investors. That HP Way 0.5 came out of the period when Hewlett and Packard established their business ideals -- then crafted the story about it in a way that was true, but missing some of its most potent context.
When HP employees' stock descended into the nether regions of popularity -- share price plummeting into the $20s and qualification for the program becoming tougher -- Mr. Market of Wall Street started to take over. The board let the vendor chase big markets like PCs, as well as cut down small product lines to make way for a new way of doing business at HP. Bigger was sure to be better, even if it sparked lawsuits and besmirched the HP patina built over all those decades.
But at the same time, the company was getting on the right track with diversity. One of the last general managers the 3000 group had was Harry Sterling. He came out as a gay man before he left his job, and diversity for gender preferences was written into HP's codes.
The New York Times story about Jackson's visit to the meeting emphasized that representation of gender was not Jackson's chosen subject.
HP has a female chief executive, a female head of human resources, and a female chief financial officer, perhaps the largest representation of women in power of any major Silicon Valley company.
Meg Whitman, HP’s chief executive, cited what she said was a long record of civil rights activism on HP’s part. Mr. Jackson noted that HP did not currently have a single African-American on its board. “This board, respectfully, does not look like America.”
Ms. Whitman later said she would meet with Mr. Jackson on the subject.
HP's diversity, or the success of the post-Jobs Apple, are subjects to be misunderstood. Past injuries -- from dropped products, or envy of a supplier that made its fortune on mobile while others did not -- tend to shape beliefs about all that follows. Some 3000 owners will never forgive this vendor for losing its belief in unique platform environments, starting with MPE. Other pragmatists still have an all-HP shop, including decade-old 3000 iron. Leadership changes, sometimes more swiftly than products are eliminated. If Whitman and her board figure that naming an African-American is part of a new HP Way, they're likely to do so. Directors Shumeet Banerji and Rajiv Gupta would remind Jackson HP's board already has some diversity. HP isn't supposed to look like America, but present a world view.
March 05, 2014
What does a performance index represent?
I know this may be a tough question to answer, but thought I'd at least give it a try.
I'm doing an analysis to possibly upgrade our production 959KS/100 system to a 979KS/200, and I see the Hewlett-Packard performance metric chart that tells me we go from a 4.6 to 14.6. What does that increase represent? For instance, does each whole number (like 4.0 to 5.0) represent a general percentage increase in performance? I know it varies from one shop to another, so I'm just looking for a general guideline or personal experience -- like a job that used to take 10 hours to run now only takes 7 hours. The "personal experience" part of this may not even be appropriate, in that the upgrades may not be close to the metrics I am looking at.
Peter Eggers offers this reply, still worthy after several years
Those performance numbers are multiples of a popular system way back when, based on an average application mix as determined by HP after monitoring some systems and probably some system logs of loads on customer systems. No information here as to where you are on the many performance bell curves. The idea is to balance your system resources to match your application load, with enough of a margin to get you through to the next hardware upgrade.
People mention system and application tuning. You have to weigh time spent tuning and expected resource savings against the cost of an upgrade with the system and applications as is. Sometimes you can gain amazing savings with minor changes and little time spent. Don't forget to add in time to test, QA, and admin time for change management.
There are a many things to consider: CPU speed and any on chip caching; memory cache(s) size and speed; main memory size and speed; number of I/O channels and bandwidth; online communication topography, bandwidth, and strategy; online vs. batch priorities, and respective time slices; database and file design, access, locking, and cache hit strategies; application efficiency, tightening loops to fit memory caches, and compiler optimizations; and system load leveling.
Since you didn't understand the performance numbers, you might hire a good performance consultant that knows the HP 3000. Of course, look for the "low hanging fruit" fruit first for the biggest bang for the buck, and continue "up the tree" until you lose a net positive return on time invested.
You'll also hear it mentioned that adding memory won't help if the system is IO-bound. That is typically not the case, as more memory means more caching which can help eliminate IOs by retrieving data from cache, sometimes with dramatic improvements. This highlights the need for a good performance guru -- as it is easy to get lost in the details, or not be able to see "the big picture" and how it all fits together.
Aside from Eggers' advice, we take note of the last time HP rated its 3000 line.
At HP World in 2002, it announced the final new 3000 systems, all based upon the PA-8700 processors. At the high end, HP announced a new N-Class system based upon the 750 MHz PA-8700 processor. The new N4000-400-750 was the first HP e3000 to achieve an MPE/iX Relative Performance Units (MRPU) rating of 100; the Series 918 has an MRPU of 1.
HP contends that the MRPU is the only valid way to measure the relative performance of MPE systems. In particular, they maintain that the MHz rating is not a valid measure of relative performance, though they continue to use virtual MHz numbers for systems with software-crippled processors. For example, there are no 380 MHz or 500 MHz PA-RISC processors. Unfortunately, the MRPU does not allow for the comparison of the HP e3000 with other systems, even the HP 9000.
HP has changed the way it rates systems three times over the life of the HP 3000. During the middle years, the Series 918 was the standard with a rating of 1. In 1998, HP devised a new measurement standard for the systems it was introducing that no longer had the Series 918 at 1. It is under this new system that the N4000-400-750 is rated at 100. Applying a correction factor, AICS Research has rated the N4000-400-750 at 76.8 relative to the Series 918’s rating of 1.
February 27, 2014
Unix-Integrity business keeps falling at HP
Numbers reported by Hewlett-Packard for its just-ended quarter show the company's making something of a rebound in some areas. One analyst said to CEO Meg Whitman that she'd been at the helm of the company for three-and-a-half years, and she had to correct him during the financial briefing last week.
"Actually, I've been here two-and-a-half years," Whitman said. "Sometimes it feels like three-and-a-half, but I've been here two-and-a-half years."
It's been a long 30 months with many changes for the vendor which still offers migration solutions to 3000 customers making a transition. But one thing that hasn't changed a bit is the trajectory of the company's Unix server business. Just as it has over each of the previous six quarters, sales and profits from the Business Critical Systems fell. Once again, the BCS combination of Integrity and HP-UX reported a decline in sales upwards of 15 percent from the prior fiscal year's quarter. This time it was 25 percent lower than Q1 of 2013. That makes 2014 the fourth straight year where BCS numbers have been toted up as lower.
"We continued to see revenue declines in business-critical systems," Whitman said. Only the Enterprise Group servers based on industry standards -- HP calls them ISS, running Windows or Linux -- have been able to stay out of the Unix vortex.
"We do think revenue growth is possible through the remainder of the year on the enterprise [systems] group," Whitman said. "We saw good traction in ISS. We still have a BCS drag on the portfolio, and that's going to continue for the foreseeable future."In a small victory among the runaway slide of HP-UX and Integrity sales, Whitman predicted that HP will pick up two points of market share in the business critical system marketplace.
"Listen, we are turning the enterprise group around," Whitman said. "You can see it in the success in ISS revenues, as well as networking and storage. We've still got more work to do on the margins. When you consider the significant headwind of the declining BCS business, the technology services operating profit performance was strong. Business critical systems continues to be impacted by a declining Unix market. BCS revenue declined 25 percent year-over-year, to $228 million."
As a marker of how small a slice that's become at HP, consider that the profits alone from HP's lending operations were more than $100 million. And the ISS revenues are 15 times higher than Integrity, at $3.2 billion.
Total HP revenues for the quarter were $28.2 billion, down 0.7 percent year-over-year and up 0.3 percent in constant currency. Total profits were HP's been stuck on $28 billion quarters since 2013. Whitman said the company has been in pivot mode "to the new style of intellectual property, around investment in innovation."
I think we've been hard at work on doing a lot of things that are going to position us as this industry continues to go through some very challenging changes. The pace of change and the magnitude of change here is as great as I've seen in my career. I think we're reasonably well positioned take advantage of those changes.
Changes in business are dictating new outlooks for older businesses at HP. It's always been that way at the vendor which cut off its 3000 futures during a post-merger closeout of product lines.
"We have businesses that are declining businesses," Whitman told the analysts, who were sometimes complimentary of where she's leading the company over the two-plus years. "We understand where the declining businesses are, we understand what we need to do with them. We've got businesses that are holding in terms of revenue, and then we've got growth businesses."
What's growing at HP will be getting whatever investment and energy the company can manage. "We have pivoted investment," Whitman said. "We've pivoted people. We've pivoted go-to-market to those growth areas in the company."
January 31, 2014
The Final 3000 Quarter at Hewlett-Packard
It's the final day of HP's Q1 for 2014, so in about three weeks we'll know how the company has fared in its turnaround. Analyst sites are rating the stock as a hold, or giving the company a C+ rating. It's instructive to see how much has changed from the final quarter when 3000 customers sent measurable revenues to Hewlett-Packard.
That would be the Q1 of 2009, including the final two months of HP's regular systems support sales of November-December of 2008. At the end of '08 HP closed its MPE/iX and 3000 lab. And without a lab, there was no way business critical support would offer much of an incentive to keep HP's support in a 3000 shop's IT budget.
The customers' shake-off of HP's support revenue didn't happen immediately, of course. People had signed multi-year contracts for support with the vendor. But during the start of this financial period of five years ago, there was no clear reason to expect HP to be improve for MPE/iX, even in dire circumstances. Vintage support was the only product left to buy for a 3000 through the end of 2010.
In Q1 of 2009, HP reported $28.2 billion in total sales. In its latest quarter, that number was $29.1 billion. Nearly five years have delivered only $900 million in extra sales per quarter, despite swallowing up EDS and its 140,000 consultants and billions in sales, or purchasing tens of billions of dollars worth of outside companies like Autonomy.
In January of 2009, HP 3000 revenues were even more invisible than the Business Critical Systems revenues of today. But BCS totals back then were still skidding by 15-20 percent per quarter, 20 quarters ago. And even in 2009, selling these alternatives to an HP 3000 was generating only 4 percent of the Enterprise Server group's sales. Yes, all of enterprise servers made up 2.5 percent of the 2009 HP Q1. But that hardware and networking is the short tail of the beast that was HP's server business, including the 3000. Support is the long tail, one that stretched to the end of 2008 for MPE, more than seven years HP announced the end of its 3000 business plans.
It's easy to say that the HP 3000 meant a lot to HP's fortunes. In a way it certainly did, because there was no significant business computing product line until MPE started to get stable in 1974. But the profits really didn't flow off the hardware using that 20th Century model. Support was the big earner, as the mob says of anybody who returns profits to the head of the organization. HP 3000 support was always a good earner, right up to the time HP closed down those labs and sent its wizards packing, or into other company divisions.
It had been a small business all along, this HP 3000. A billion dollars was a great quarter's worth, and the 3000 division never came close. But all of HP's business critical servers together only managed $700 million in sales -- five years ago. The profits from such customers were only significant because of support relationships. This is why those contracts were the last thing HP terminated.
This eventually became a good thing for the stalwart support companies that remained by the 3000 manager's side. At least there was no HP to quote against a company like Pivital Solutions that specializes in real MPE/iX support, for example. No vendor claims of "we can engineer a patch or software fix" that a system vendor uses to retain a customer. By January of '09, HP Support took on the remaining 3000 operations and briefed customers but offered no clue on how much contact the community might expect from support. HP's community liaison to the 3000, its business manager and lab experts departed.
The final months of 2008, which made up that very last HP 3000 quarter, capped a year with many months of no information whatsoever from the vendor. HP didn't appear eager to address much except the migration nuances still available to companies leaving the platform. To nobody's genuine suprise, Hewlett-Packard wasn't winning much migration business from 3000 customers making a transition.
We know that's true because of a report from Stromays during 2010. Sometime during 2008, HP re-established contact with the only company that made a concerted effort to emulate an HP 3000. According to Stromasys CTO Dr. Robert Boers, three out of every four departing 3000 sites chose a non-HP environment. And without MPE/iX to support, the only money a former 3000 owner would be sending -- if they were pragmatic, and not incensed -- would've been for HP's Intel-based Proliants, running Windows.
The quarters of 2009 and 2010 might have eked out a bit of revenue from 3000 owners. Some were determined to purchase the HP support that had no hope of fixing problems via new engineering. But HP was not encouraging this by the final months of Q1, 2009
HP strongly recommends that customers request all available PowerPatches and SW Media that they may need for the remainder of the life of their e3000 systems, before December 31, 2008. Customers under Mature Product Support without Sustaining Engineering (MPS w/o SE) can still request PowerPatches and SW Media during the remainder of the Limited Support Extension, through their local HP Representative or Contract Administrator; however, processing and delivery time may vary.
The one and only source of revenue today from the HP 3000 community to HP -- something that will comprise a scant trickle of cash -- is the $432 license transfers, still in place after five years to enable an emulator to replace a 3000.
The HP Software License Transfer process will continue to be used in the event an HP customer wishes to transfer an existing MPE/iX Right-To-Use (RTU) license from a valid e3000 system to an emulation platform of the customer’s choice that runs on other licensed HP products. It will be a system-to-system transfer, regardless of the number of CPUs on the destination platform.
Even in the situation of forcing companies off a server that was working, Hewlett-Packard attempted to keep them on hardware "that runs on other licensed HP products." Classy to the end. HP signed off in January of 2009 with a thanks for all the fish message, urging everybody to get to a lifeboat. But few of the boats would be flying an HP flag, despite these lyrical hopes.
Finally, we want to take this opportunity to thank OpenMPE, Interex, Encompass, and Connect for their dedication to customer advocacy over the years, our HP e3000 ISVs, tools, and support partners that have contributed a rich set of products and services on top of MPE/iX for our customers, and our migration service and tools partners for their invaluable services and products in assisting our customers with their migrations to other HP solutions. Most of all, our sincere thanks to our valued customers. HP looks forward to continuing to provide our customers the best-in-class services and the opportunity to serve you with other HP products.
January 13, 2014
HP to surf legacy OS onto new platform
HP's Unix customers aren't so lucky, but the companies that rely on the NonStop OS have been told they're getting an x86-ready version of their fault-tolerant environment.
“No matter what HP NonStop hardware architecture you choose, you will continue to get 100 percent NonStop value that makes what you do truly matter,” CEO Meg Whitman explained to the installed base. It's a message that might make an HP-UX customer wonder if what they're doing, strictly on Itanium hardware, will truly matter.
What matters to HP is the stickiness of the NonStop customer. They demonstrate the same kind of product and company loyalty that the 3000 customer did, at least until HP announced the end of its MPE business. Technically, there are possibilities for c7000 blades to run the environment first released when Jim Treybig left HP to form Tandem.
There are no promises here, and no roadmap for release of this transitional product. It's much further out than the reality of running MPE/iX on Intel servers -- and that Stromasys solution won't require special Intel hardware from HP. But it's more of a future than the OpenVMS and HP-UX enterprise customers are facing.NonStop is in heavy use in the banking industry, and the dollars it brings to Hewlett-Packard are rich with profits. There's never been a transition that HP has managed to sweep a legacy -- sorry, proprietary -- OS like NonStop onto the wave of commodity hardware. MPE/iX got its marching papers, HP-UX was kept on the Itanium leash, OpenVMS was leashed until last year -- when its customers learned the OS was going to freeze on the current generation of Itanium chips.
But it's possible that this vendor is finally seeing a way to model another kind of migration, one that delivers more options to a customer instead of declining levels of support and relevance. A broad-brush HP document that waves the flag toward the future is online. NonStop is about three years younger than MPE/iX, and it's been a part of HP since the Compaq acquisition of 12 years ago.
This is what choice might have looked like for three other HP-owned operating systems. It's also the first significant product announcement that could have an impact on the careening fortunes of the Business Critical Systems group. If there's going to be a migration in the future for this group of business computer customers, HP would rather see the transition from one set of hardware with an HP badge to another.
December 30, 2013
2013 emboldened 3000 changes for both migration and homesteading practices
As a service to readers who crave summary and broad strokes, we hearby sketch what the year 2013 meant to the 3000 community. It's too much of a cliche to say that the previous 12 months were driven by change. That's been an essential element for the community since 2001. But a dozen years has now spread changes onto the migrating community member, as well as those who have made their mission one to homestead.
The HP 3000 CHARON emulator from Stromasys showed more promise this year, but some of its impact lay in the way it held migrations in check without even being deployed. Another factor came from the economy. By year's end the markets were flying at an all-time high, but the recovery has its blind spots, according to some 3000 users. Couple the proposed savings in keeping MPE apps virtual with with an uncertain future for HP's replacement solutions, and the movement away from the 3000 slowed.
Even with that evidence, some shutdowns of systems stood out. A major installation of 3000s that had been serving the airline industry saw their work moved to .NET replacements, as Open Skies became New Skies. We also saw Hewlett-Packard closing down its own internal HP 3000 operations at long last, powering off the final four systems, just 12 years after advising its customers to do the same.
The year also offered a chance to see what remained on the field a decade after the community marked the World Wide Wake of 2003. The server got its first iPad app when a terminal emulator emerged for iOS, even as other experts found other ways to get an MPE console onto a tablet. And the exit of expertise continued throughout our 3000 world, even as some stalwart resources remained online.HP set the pieces in place long ago for its 3000 strategy to evolve away from the need for physical hardware. The Apps on Tap strategy that led to the Open Skies offering -- where networked 3000s serve up apps to customers who don't have servers onsite -- is now being echoed in Software as a Service.
Sites that moved off HP 3000 installations for ecommerce software watched their vendor get acquired, then see the open version of their software slip into a 140-product lineup. It was an example of how migrations became a part of life at those 3000 sites that had already left MPE behind. Even among the sites where server migration hasn't occurred, data migration is already afoot. Customers are now looking at a migration off of Windows XP for their users, and some are facing the same reluctance and lack of budget they saw for 3000 diaspora.
Hewlett-Packard had its share of problems to overcome, from shuffling the pathways to MPE documentation online to keeping its enterprise mission critical business from evaporating. Each of the four quarters of revenues for its BCS group posted a 20 percent sales decline from the previous year's numbers. It was a continuation of a 2012 trend. The company's CEO and CFO called the Unix server business a formerly growing venture. Then there was the announcement of curtailing another HP business OS, OpenVMS, starting in 2015 when new Integrity systems won't run on the environment. Things got so critical for BCS and its bretheren that HP reorganized the whole enterprise server operation into a single unit, then removed its executive VP from the job.
Emulator news emerged from two fronts. Stromasys built out its management for the CHARON product and opened the doors on its North American rollout with a May Training Day event. The latter was the first 3000-specific event in almost two years. In the snows of February in Europe, a similar event for CHARON recalled HP's final organized event for the 3000, nine years earlier. Early in the fall, a group of freeware developers was trying to create a not-for-commerce version of what it called a simulator of HP 3000 hardware. Successful booting remained elusive.
In the meantime, the offering of an emulator had customers checking HP's rules and processes for license transfers, some three years after the company shut down all other 3000 operations. It helped to be able to ask for the right process, and ask the right person.
Another trend emerged in the longevity of the 3000 expert. Outlasting the 3000 server was a duel that some experts were giving up. One company in LA made a shift to Windows because its IT staff for the 3000 was aged 67 and 72. But among those who continued to keep the MPE lamp lit, techniques to continue 3000 operations still emerged. Replacing HP's disks with third party alternatives got detailed to swap in fresh hardware for decade-old drives. Moving store to disk files with attributes intact is possible with newer open source archiving software.
The year showed that change itself has changed for the community. The long run of the HP 3000 unreels into the dark of the as-yet-unlit future. There was even a careful examination of the costs of remaining on the 3000 for 5-10 years.
December 02, 2013
While you were away, what HP put into play
We're back after a 4-day holiday. The Thanksgiving holiday period can be interesting times for watchers of Hewlett-Packard. We count ourselves among that group, even though the company has little to do with the lives of homesteading 3000 users. (But not nothing at all -- we heard last week that HP Support contracts for 3000-connected HP peripherals have been altered. End-of-support-life dates have been adjusted, according to our source. Check your contract; indie providers are available as an alternative.) HP announced the Odyssey program to give a Linux future path for Unix customers during the week. Of course, the 3000 exit notice took place just a week before Thanksgiving in 2001.
However, much broader items than tactical details of contracts surfaced over this holiday weekend. The most splashy was the news that Hewlett-Packard is now the company providing infrastructure for the US Healthcare.gov website. That's the site that turned away about 80 percent of users during October because of technical and bandwidth problems.
HP signed a $38 million contract with the US Health and Human Services agency this summer, but Terraform (a subsidiary of Verizon) had built out the website hosting that blocked many an attempt to use it. Over the weekend, healthcare.gov doubled its bandwidth and can now reportedly serve 50,000 users simultaneously. That sounds like a lot, but about 800,000 citizens tried to open an account. (Just as a note, as of 2 PM today, we registered an account and shopped for the first time online.)
The largest simultaneous user count we've ever heard reported for a single HP 3000 server was 2,200. Consider that was a single server, built with PA-RISC (two generation-old chips) using SCSI IO. Redundancy has been an essential high-volume aspect of 3000s since Quest Software built its NetBase/Shareplex replication solution in the 1980s. Quest, now a division of Dell, still supports HP 3000 sites using the product, according to John Saylor there.The problem at healthcare.gov has been its architecture, rather than the horsepower of the iron. HP seems to have little to lose in taking over this contract. By the accounting at the Wall Street Journal, 36 states rely on application through healthcare.gov and just under 27,000 people were able to enroll in a plan during the first month. The 14 state exchanges enrolled 79,391 people during the same period.
The Journal article says the government has been aware of "certain problems with the Terremark hosting service since late 2010." HHS moved its Medicare and Medicaid service centers to Terremark during a two-year hosting contract. These service centers oversee Healthcare.gov.
The details in the WSJ report include an oversight, which if true, would be laughable in a standard HP 3000 environment: "Its design didn't include a full backup version of the site in a different data center. Healthcare.gov is still housed with a single data center." The HP 3000s which Hewlett-Packard unplugged from its own datacenter in October had backups in Austin. HP also got a $4 million contract in September for healthcare.gov DR services.
On the company valuation trail, HP played out a Q4 2013 report that Buys Time, Not Triumph according to a WSJ analysis. "Tech Giant Arrested Its Slide in Some Key Areas, but Pressures Will Intensify. One good quarter doesn't equal a turnaround." But the numbers which included dreary figures for HP's Unix operations still managed to push HP's stock to a two-year high as of this morning.
The markets were not spooked by the prospect of business critical server sales dipping once more.
HP also opened up access to its board of directors in a vote during the Thanksgiving week. A vote by a simple majority of shareholders will be enough to change HP rules governing the nomination of directors or the size of the board. Previously, a two-thirds supermajority was required. "The change doesn't immediately let activists storm the boardroom, but could lower the gates that keep them out," said a Journal article.
HP got its current board chairman, Ralph Whitworth, when its rules changed in 2011 to admit that principal at "an activist hedge fund Relational Investors LLC."
Right now, you've got to own at least 3 percent of HP's stock for three years to nominate a director. The Journal said only three people have owned that much sstock since the end of 2012. This makes nomination of new directors an insider affair today.