Enterprise users shouldn't expect any near-term technology or price and performance gains from Hewlett-Packard's planned purchase of Compaq Computer announced last week.
The benefits are going to be far more evolutionary in nature and will depend entirely on HP's ability to cherry-pick and integrate Compaq's rich but overlapping technology portfolio, users and analysts said.
"Certainly, there are some very interesting possibilities resulting from the merger," said Joseph Pollizzi, president of Encompass, a Chicago-based Compaq user group.
"The part that really scares me is when you look at the huge boatload of systems" that a merged HP will have to carry, he said. "We need to know what is going to win and what's going to lose."
In the aftermath of the announcement, users and analysts agreed that in the short term, a merged HP is unlikely to look very different from an independent one, except on the services-delivery front.
"It's not like the two companies were yards and yards apart" in terms of their technologies or customer bases, said Laurie McCabe, an analyst at Summit Strategies.
At the very highest end, Compaq's NonStop Himalaya platform will give HP a well-proven and profitable fault-tolerant technology to pitch at enterprises, said Jonathan Eunice, an analyst at Illuminata. But those businesses are likely to comprise a very narrow segment of the high-end market. To truly take advantage of its technology, HP will need to migrate bits and pieces of it downstream to its Unix and Windows servers, he said.
On the server front, few people expect a merged HP to support both its own HP-UX and Compaq's Tru64 Unix for long. Instead, look for a new generation of HP-UX that integrates elements of Tru64 Unix, most notably its advanced clustering capabilities, said Rich Partridge, an analyst at DH Brown Associates.
Compaq has already announced its intention to phase out its AlphaServers and standardise its enterprise architectures based on Intel's emerging 64-bit Itanium processor family. And HP, which is one of the co-developers of Itanium, is well along in its own plans to move everything over to Intel's platforms.
HP/Compaq will also be able to offer better storage options than either company can offer on its own.
"The joint NAS [network-attached storage], SAN [storage-area network], communications and storage-management offering will rival that of EMC and IBM for completeness of solution," according to a report on the merger published by research firm The Yankee Group.
When Compaq acquired Digital Equipment Corp in 1997 and Tandem Computers before that, the company was in a similar position to take advantage of a range of enterprise technologies. While Compaq continued to support its acquired products, the company did little to commercialise core technologies, such as Tandem's NonStop Kernel, that would have helped differentiate it in the server market, McCabe said.
HP should do a better job than Compaq in absorbing and exploiting the technologies that will be at its disposal, said Terry Shannon, editor of "Shannon Knows Compaq", a US-based newsletter.
The merger's success will also depend on how well HP takes advantage of its larger service-delivery capabilities, which will swell to 65,000 service professionals from HP's current 27,000, McCabe said.
