CenterBeam
eWeek, 11/22/03: HP Melds Services, Systems
By Jeffrey Burt, and Paula Musich
HP announces it will combine its services and enterprise systems groups.
Hewlett-Packard Co.'s decision to fold its services and enterprise systems into a single unit is being met with a mixture of enthusiasm and skepticism.
Chairman and CEO Carly Fiorina announced the move to combine one of HP's stronger departments—services—with its embattled hardware groups at a meeting with financial analysts in New York last week. The new unit will be called the Technology Solutions Group and will encompass services, software and hardware servers, and storage devices.
In a memorandum to employees, Fiorina said the move made sense for a number of reasons, including enabling HP to make its operations more transparent for investors.
"This more holistic grouping allows us to simplify our structure [and] more effectively deliver the Adaptive Enterprise," HP's utility computing initiative, Fiorina said in the memo.
HP, of Palo Alto, Calif., had been working on the reorganization for six months, creating a task force to oversee the move, according to a source close to the company.
Ann Livermore, executive vice president of the services unit, will head the Technology Solutions Group, while Executive Vice President Peter Blackmore, who led the Enterprise Systems Group, will direct HP's newly unified sales force, called the Customer Solutions Group.
The merger of the groups won't change what HP is selling, only how the products are sold, said Kevin Francis, president and CEO of IT outsourcer CenterBeam Inc., which uses HP blade servers. "HP is moving to a customer-centric organization focused on delivering the best possible value to its customers, and that is completely aligned with CenterBeam's 'customer-first' philosophy," said Francis, in Santa Clara, Calif.
However, analyst Richard Ptak said HP may be setting up a structure that didn't work for other technology companies in the past.
"HP is reproducing a strategy that failed at DEC [Digital Equipment Corp.] and was tried and failed at Compaq [Computer Corp.]," said Ptak, principal of Ptak, Noel & Associates, in Amherst, N.H. "The strategy offers bundles of services, systems and software at a reduced cost. The idea being that really, really low hardware margins are offset by the margin in services. The problem becomes pricing of services. It is very difficult to competitively price and deliver services. It is difficult to accurately track the actual cost of services and easy to fool yourself into thinking you are making money when you aren't, which is what happened at DEC."
HP has been working to bolster the Enterprise Systems Group since its $19 billion acquisition of Compaq in May of last year. The group sustained five consecutive losing quarters until last quarter, when it posted a $106 million profit on $4.07 billion in revenue. In contrast, the HP Services Group earned $393 million in that quarter, garnering $3.23 billion in revenue. At the meeting last week, HP announced additional services contracts worth more than $1 billion.
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Outsourcing
Infoworld, 12/19/03: Offshore outsourcing IT: Debate to rage again in 2004
Corporations expected to increase use of global IT services
By Marc Ferranti, John Ribeiro and Sumner Lemon
Industrialized nations have engaged in cross-border outsourcing for decades, but this year the issue came to a head for the world of IT, which has seen the debate about "offshoring" spill from technology circles into the realm of politics, macroeconomics and labor unions.
Controversy about offshore outsourcing, however, is likely to generate even more headlines in 2004, since corporate plans to increase outsourcing coincide with an increasing number of offshore outsourcers entering the global market.
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Utility Computing
C|net, 12/22/03: Utility computing: Rolling along despite identity crisis
Technology makers moved ahead with utility computing strategies in 2003, despite a lack of agreement on what utility computing really is or what it should cost.
In many ways, the definition of "utility computing" seems fuzzier than ever. Ideally, say analysts, the idea of utility computing is to offer software and business applications on an outsourced basis, whether those services are offered to paying customers or to users within a company's firewall. The software and applications can be allocated in varying amounts, depending on a customer's need at any given time.
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Security
Computerworld, 12/22/03: Open-source group issues Microsoft patch
But security experts urged Windows users to wait for an official fix
Story by Paul Roberts
An open-source software development group posted a file on its Web site this week that it claims will patch a recently disclosed security hole in Microsoft Corp.'s Internet Explorer Web browser that allows online scam artists to fake Web page addresses.
The decision by Openwares.org to publish the Internet Explorer patch is just the latest example of third parties preempting Microsoft with fixes for security holes in the company's products. But one security expert warned that installing the unauthorized patch could introduce more problems than it solves and advised Microsoft customers to wait for an official fix from the company.
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Mobile
Computerworld, 12/19/03: Trends for 2004: Managing and securing your mobile workforce
Opinion by Brad Boston, Cisco Systems Inc.
We are quickly morphing into a mobile workforce. Users perform day-to-day business from places we never thought possible. Airports, coffee shops, hotels, convention centers and commuter trains have become extensions of the office. Even airplanes are beginning to offer connectivity to passengers, something unheard of only a few months ago.
In short, the Internet and wireless mobile networks have made information access available to users from nearly anywhere.
Mobility can offer huge gains in productivity, so we must embrace and manage it. A study on wireless LAN benefits conducted by NOP World Technology for Cisco Systems and published last month, for example, showed a 27% increase in productivity and an annual savings of almost $14,000 per mobile employee. Moreover, Gartner Inc. predicts that the number of North Americans using WLANs on a frequent basis will grow from 4.2 million in 2003 to more than 31 million in 2007.
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Otherwise
The New York Times, 12/22/03: Sculptor Invents Catapult Toy
THIS is a story about a toy that many children will not unwrap this holiday season, even though it has been praised by Family Fun magazine and Scientific American.
The toy is the Cat-A-Pult, invented by Arthur M. Ganson, a sculptor who a decade ago invented a popular toy called Toobers and Zots - bendable, brightly colored foam pieces in whimsical shapes that children can manipulate to create sculptures.
Mr. Ganson received patent No. 6,644,292 for the the Cat-A-Pult only last month, even though it has been on sale since 2002.
"The idea grew out of a serendipitous thought of just imagining what would happen if you brought together a catapult and a mousetrap and dominoes," Mr. Ganson said. The toy includes a little foam cat, to play on the idea of a catapult.
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