HP Very Reliant on ProLiant

Six months after the merger, the company bids final adieu to its NetServer line and looks forward to growth in blades and system management software.


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Posted November 21, 2002

Michael Singer

Hewlett-Packard is now a 100 percent ProLiant company.

The Palo Alto, Calif.-based computer and printer maker Friday officially retired its single IA-32 NetServer line in favor of Compaq's more profitable and established brand.

The company, which topped Wall Street Estimates yesterday, said it was a very good quarter.

"The good news is that we are number one world wide for servers in that we have 42 percent market share," HP general manager Mary McDowell told internetnews.com "Europe remains a stronghold and we're very well positioned in China. We've got some work to do some work in Japan and it's still a dogfight in the U.S. between us and Dell."

Part of HP's success in the last three months included a $200 million win with Ericsson for StorageWorks, ProLiant and UNIX servers.

McDowell said the focus going forward is building their second generation ProLiant Blade servers with four processors (Intel Xeon and Pentium 4) as well as adding storage (SAN ) connectivity.

The company also expects to increase its ProLiant system management software including OpenView and ProLiant essentials platforms.

"More and more of our customers are trying to get a more solid operational basis and manage their existing networks," McDowell said.

The choice to abandon HP NetServer quells concerns by analysts who complained there was too much overlap between Compaq and HP especially in the realm of Enterprise.

"Now that the companies are merged we are beginning to see that the strategic thrusts in key businesses such as enterprise and PCs are beginning to take shape. Finally, and probably most importantly the first true signs that its merger with Compaq is beginning to work is becoming evident," analysts at Deutsche Bank Securities said Friday.

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