Where is Integrity on its takeover curve?
November 3, 2006
Although we asked this question of HP's Nigel Ball, he could not answer until HP's year-end results are announced in a little less than two weeks' time. HP set a goal a few years ago — increase the revenues from sales of Integrity servers, HP's recommended replacement for HP 3000s, until Integrity's and their Itanium 2 processors made up 70 percent of HP's revenues.
In 2005, HP said its goal for the future of its enterprise server business was to have Business Critical Server unit revenue will grow to 50 percent by the end of 2005, and 70 percent by the end of 2006.
Attaining this goal is important to HP 3000 customers. Those who are staying with HP and investing in HP-UX in particular would benefit from HP hitting its targets, and on schedule, too. HP's Unix runs on PA-RISC processors in HP 9000s, sure. But the hardware with the biggest boost for the buck uses Itanium. If nearly three of each four systems sold wear the Integrity badge, that's a lot of critical mass for the HP Unix platform.
Last year at this time, HP was trailing its 2005 estimates of Integrity ascendence. Ball promised us numbers once HP's quarterly figures are released in the week of Nov. 13. HP, by analysts estimates, will have revenue of $91.2 billion in fiscal 2006.
On Nov. 14 the I'll be riding down to San Antonio — just a few days after the HP 3000 conference on the Gulf Coast — to see HP's Integrity Solutions road show. Raw hardware speed and feeds will make up one track of the morning-long event. Virtualization, which has extra features on the Integrity servers, makes up the other. HP is tailing off its production of the PA-RISC servers. HP 3000 sites are ordering little else but Integrity systems, according to reports from the migration vendor community.
Orders and sales of Integrity will be a part of the HP report and analyst briefing two days after the San Antonio Integrity show. On Nov. 16 customers can get a glimpse at how much ground Integrity has gained since those HP forecasts. The delay of the Montecito generation of Itanium 2 last fall — an extra half-year of waiting — could not have helped.
Montecito's speed and cost advantage can help deliver the critical mass for HP-UX to give the operating environment a safe lifespan. It's true, applications do drive the marketplace. But Itanium is very different than other architectures. It needs an ample installed base in order to maintain the interest from the application community. HP has more at stake than just meeting numbers by the end of this year.