Hewlett Packard Reboots With Enterprise Focus
Hewlett-Packard, HP, the iconic company often credited with laying the foundation for Silicon Valley and, with it, an unprecedented burst of technological creativity, attempts to reinvent itself beginning today as HPE, or Hewlett Packard Enterprise.
As with many technology giants currently struggling to evolve, HP moved last year to transform itself by announcing it would split itself in two: HP Enterprise includes the company's server, cloud computing and other "enterprise" units while HP Inc. includes PCs and printers, the latter carrying the company for much of the last decade.
HP Enterprise (NYSE: HPE) debuts today (Nov. 2) with a little north of $50 billion in annual revenue and what CEO Meg Whitman hopes is a strategy to compete in an increasingly cutthroat enterprise technology market. Whitman's plan entails competing head-to-head on cloud and datacenter infrastructure while growing its IT security and big data units that are gradually being folded into a range of enterprise offerings.
The company also hopes to transfer the expertise it developed in dividing itself in two to offer "workplace productivity" products. Cloud networking also is emerging as a possible revenue generator.
In announcing its plan late last year for "doubling down on infrastructure," Whitman stressed that the enterprise company would serve as the focal point for HP’s infrastructure push centering on converged IT, servers, storage, software-defined networking, and a Helion cloud offering built on OpenStack.
The Helion cloud computing initiative was initially positioned as a direct competitor to Amazon Web Services (NASDAQ:AMZN), but HP announced last month it would shut down its Helion Public Cloud early next year. Instead, HP said it would recalibrate its cloud strategy to focus on private clouds running on HP servers while helping cloud customers run their software on AWS, Microsoft Azure and other public clouds.
HP executives said last month they had decided to pull the plug on Helion cloud because public clouds were no longer a "core area" for the HP Enterprise. Public cloud services are also among the most cutthroat of enterprise sectors, with public cloud leaders AWS, Google (NASDAQ: GOOG) and Microsoft (NASDAQ: MSFT) engaged in constant price wars.
Observers note that the move away from public cloud offerings plays to HP Enterprise's strengths as a hardware vendor and provider of managed IT services. Indeed, Whitman told the New York Times over the weekend that the company sells "a server every six seconds. We had to keep selling them."
The question for HP Enterprise is whether continued server sales will be enough?
Addressing that concern, HP Enterprise said this week it would focus on hybrid infrastructure by helping customers "manage information across traditional IT and private, managed and public cloud environments."
As with competitors like IBM and Microsoft, HP Enterprise also is embracing open source cloud platforms like OpenStack. While dumping its Helion public cloud initiative, the company announced the latest version of its OpenStack cloud platform at the open source community's summit on Tokyo last week. Version 2.0 of Helion OpenStack stresses the "provisioning of new infrastructure and the ability to repurpose existing infrastructure to meet scalability," the company stressed.
Another area where HP Enterprise is seeking to differentiate itself is cloud networking, especially emerging software-defined networking used to connect multiple datacenters. The new version of Helion OpenStack integrates HP's Distributed Cloud Network with a virtualized services platform developed by Nuage Networks, the Alcatel-Lucent startup venture focusing on software-defined networking solutions for the cloud.
HP moved earlier this year to shore up it network offerings by acquiring Aruba Networks. HP said the $3 billion deal was predicated on the assumption that legacy enterprise networks are being overwhelmed by the shift to mobile devices. The new HP unit will seek to leverage the emerging 802.11ac Wi-Fi standard that supports higher speeds and access to cloud applications.
These and other acquisitions may be paying off for HP Enterprise as it embarks on a new era as an IT infrastructure and management software vendor. For example, news surfaced last week that the University of North Carolina at Charlotte tested wireless access points from Cisco Systems and HP Aruba and selected the latter as the supplier for its 802.11ac wireless. LAN.