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October 31, 2005

Two years past no-sale, plenty to buy

Two years ago today, the HP 3000 fell off HP's corporate price list. The worldwide community held a "wake," prompted by ScreenJet's Alan Yeo, and got itself into the mainstream trade press with its marker of the end of HP's sales era. But sales have continued beyond HP's plans, out in the rich field of independent resellers.

All though the 3000 community, the lights continue to blink on the latest HP 3000s the vendor ever built, the last-generation N-Class and A-Class servers. These systems scarcely got a half-year of unfettered sales time at HP before the vendor announced the end of its 3000 business in 2001. As one IT manager — from a major shop with "double-digit" numbers of N-Class servers still running a sales counter application — told us two years ago:

HP finally puts the HP e3000 on an even hardware playing field as HP-UX and they discontinue the platform — pretty frustrating.  We do plan on upgrading these N-Class systems over the next couple of years.  If HP does not have the parts, we will look in the secondary market.

There are many places to look today, two years after the wake. If anything has died off, it only appears to be HP's official stream of 3000 systems. And even HP was participating in 3000 sales through a secondary market outlet, Phoenix 3000, which resold the systems HP took in trade-ins.

HP seems to have slipped to secondary status in the hardware marketplace for 3000s, although the vendor just managed to outbid Genisys in last Thursday's Interex customer list auction. Of note: Genisys placed a bid of $66,000 at the very end of that auction. Even though HP nipped past Genisys to take control of the list, it's important to remember that Genisys had $66,000 to spend on the list. That shows some financial strength from that member of the independent hardware reseller community.

The community has gotten creative, too. Systems Support Group launched a Web site a few years back which it called HP TraderOnline. HP "respectfully" asked SSG to drop the HP part of the Web site name this summer. By the end of the year, this hardware Web resource will have to make do with Hi-Tech Trader Online (www.hi-techtrader.com), but it's got a "wanted to buy" section along with the usual N-Class, 9x9 and 9x8 systems as well as XP storage arrays. In an interesting business model, customers can buy a membership at $25 a month or less to post unlimited HP and Compaq inventory — and it's always free to shop.

When deciding whether to build up or move away, customers are more tied to their applications than HP's support, in many cases. Third-party options for hardware and software support, from suppliers like Pivital Solutions, make staying no less risky than relying on a dwindling HP support network. As Keith Robertson of Comsonics told us just before that wake of 2003:

Our MRP program is tied to the 3000, thus a hardware migration is also an ERP implementation; nothing to take lightly, either logistically or financially. So for now we're staying pat. Any improvements to our 3000 will come from the used market.

Another customer, who runs a 911 dispatch center and wanted to remain anonymous, said reliability was more vital to his company than buying direct from a systems vendor:

As of today, our plans are to stay on the 3000 for the foreseeable future — we will purchase hardware and software support from third party suppliers.  In our business, reliability is critical and the HP3000 platform has provided that (I'm knocking on wood right now...).

A little while ago here on our blog, we took note of some hardware resources for purchasing systems. The network of suppliers seems to be growing bigger. As more companies choose to migrate away from their HP 3000s — larger sites seem to be migrating first — their top-class servers will become available on the used market.

There's another element of the 3000 hardware market that seems to have some headroom to grow. Genisys' Robert Gordon said from his booth at the recent HP Technology Forum that customers who know the 3000 have their own spare parts options to rely upon.

"They're either going to go third party maintenance, or they're going to self-maintain," Gordon said. "I think a lot of people are technically savvy on the 3000; they know it's not rocket science, and they're going to buy spare board kits. So we're going to see that business pick up. We'll see a lot 3000 sales in the year 2006."

10:03 AM in Homesteading, Newsmakers | Permalink

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Whilst the original Wake site referred to in the above link was removed, we conducted an email vote amongst those who attended a Wake Venue, the result was to keep the history and as such a list of venues by country, attendees and some photos are still on-line at http://207.21.244.161/hpwake

Posted by: Alan Yeo | Oct 31, 2005 11:26:19 AM

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