HP Microsoft partnership has major channel implications

HP (Nasdaq: HPQ) and Microsoft (Nasdaq: MSFT) have signed off on a three-year strategic agreement worth approximately US$250 million that aims to leverage existing investments to deploy unified virtualization and management, along with cloud-applications.

One of the keys to this three year deal will be the HP Smart Bundles with Hyper-V. These solutions will be based on new Microsoft virtualization technologies containing Windows Server 2008 R2 with LiveMigration. This solution is typically what the market and the channel will see coming out of this three-year arrangement from the two powerhouse vendors. The HP Smart Bundles with Hyper-V, for example, will come with ProCurve networking solutions leading to fairly quick virtual infrastructure implementations for customers.

Mark Hurd, CEO of HP, said during a conference call with reporters that the channel will look at these solutions as more simplistic.

“All this is getting optimized and the channel will get a bundled solution that is tested, with marketing collateral around it, and promotions. If I were a channel partner, I’d say now you have simplified my life with pre-ready to go to market products from two companies. We have made it easier for the channel and in turn easier for the customer,” Hurd said.

Brian Bourne, president of CMS Consulting of Toronto, a noted Microsoft solution provider, said he has been working with HP and Microsoft on this endeavour on customer readiness training. Bourne said he would like to see this announcement truly be a step further than just bundling solutions.

“Currently customers would get a server with Windows, or Linux, or ESX or Hyper-V so packaging that up at the source makes it easier for the reseller. It’s what customer’s are asking for. For Canada, HP is making an increased commitment to the Microsoft space and let’s be honest here they are interested in virtualization and unified communications because it drags a lot of blades and lots of storage,” Bourne said.

Hurd did say that this announcement was more just bundling solutions from two vendors who have worked with each other for the past 25 years. Hurd said that more than 11,000 people have been working on pre-testing and pre-loading solutions along with the logistical portion of implementation. “To my knowledge this will be the biggest alignment of infrastructure to any enterprise offering we have ever had. From my point of view, you have the No. 1 software vendor and the No. 1 tech company in the world starting from April working together,” Hurd said.

He added that this new strategic alliance with Microsoft was in no way a reaction to any other competitor move including Oracle’s acquisition of Sun Microsystems.

One of the other main aspects of this deal that could impact the channel was the announcement that HP would have new dedicated sales reps and try to sell more through these reps along with the 32,000 channel partners.

This aspect of the deal does not concern Bourne too much because CMS’s business is integration so the more products are sold the more integration business he may get, he said.

HP will be making more financing available for these bundled solutions through HP Financial Services specifically for channel partners. Also, Microsoft and HP will by jointly funding worldwide marketing campaigns, lead-generation programs and sales tools as well.

The three-year working relationship will also see both companies collaborate on an engineering roadmap for data management machines, converged, pre-packaged application solutions, virtualization offerings and integrated management tools. Some of the products involved in this roadmap will be Exchange Server, SQL Server, HP Insight software, Microsoft System Center and Hyper-V.

Another important part of the announcement is Microsoft Windows Azure. Microsoft president of the Server and Tools Business, Bob Muglia said that HP and Microsoft will work together on Azure to try to take advantage of the next generation cloud will see newly created applications for private and public clouds.

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Jim Love, Chief Content Officer, IT World Canada
Paolo Del Nibletto
Paolo Del Nibletto
Editor of Computer Dealer News, covering Canada's IT channel community.

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