HP takes bold shot at IBM

LAS VEGAS — “”Bold Strokes”” was the main theme for this year’s Hewlett-Packard Americas Partner Conference, and HP could not have been any bolder with its enticements for partners to go after IBM/Lenovo accounts.

The program, called Competitive Displacement, includes increased discounts of up

to 40 per cent on demo equipment for desktops, notebooks and workstations, as well as enhanced margins of two to four per cent on the sale of desktops, notebooks, workstations and select HP Care Pack packaged services.

“”I like to refer to IBM as EOL — End of Life — and our new campaign will earn partners more money through incentives so that partners can go after displaced IBM customers because of the Lenovo deal,”” said John Thompson, the vice-president and general manager of HP’s Americas Solution Partners Organization.

Thompson added that this displacement strategy will also address other competitors such as Dell and Sun. He believes the Sun opportunity is worth US$300 million in the Americas. “”It is low-hanging fruit, and I encourage (partners) to go after that. You do not need to be a genius to realize that Sun is on the ropes.””

HP will also turn over more than 30 per cent of its Tier 1 direct accounts to partners.

This program is initially only available in the U.S., but will enter Canada later this year.

Harry Zarek, president of Toronto-based solution pro-vider Compugen, said moving 30 per cent of HP’s direct accounts to the channel is a very bold move. However, he believes that identifying the issues about governance and the rules of engagement are more important.

“”There are huge accounts and they are very complex, so I am OK with them taking their time. For us, were are already in position to handle these accounts, but I also believe they will not be handing over these kinds of opportunities over to us on a platter,”” he said.

As for HP’s PC displacement strategy, Zarek said he would only be interested in it on new business opportunities only. “”We are not in the business switching platforms for other platforms,”” he said.

Canadian plans

The 145 Canadian partner companies attending the conference also learned of new country-specific demand-generation, rebate and marketing plans for 2005.

Called PowerTools, the demand and lead-generation program will attempt to further HP’s efforts with the channel on co-branded messaging. In this plan, solution providers will be able to leverage HP communications to help get in front of C-level executives.

HP Canada also introduced the Assigned Rebate Model (ARM) program. Under it resellers are assigned rebates from a particular distributor, either Ingram Micro, Tech Data or Synnex. This program is in the pilot stage, Frederickson said.

The program will be first rolled out to PartnerOne Diamond and Platinum partners starting in April. The ARM program will also address the growing problem of the grey market. In the past distributors purchased HP’s products for which partners received a standard price, who then asked for a rebate. With ARM, every price will be on a specific business opportunity.

“”The partners buy at one price and they do not have to claim back the rebate, so that particular customer also knows the price they are getting,”” said Heather Kent, vice-president of marketing for HP Canada.

Frank Abate, president of Mississauga, Ont.-based Infinity Technologies, was chosen by HP Canada to test the ARM program. “”From a cash-flow perspective, moving it to an upfront cost is very helpful,”” he said.

“”ARM looks after cash flow and removes the grey market option for VARs who still dabble in it.””

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Jim Love, Chief Content Officer, IT World Canada

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Paolo Del Nibletto
Paolo Del Nibletto
Former editor of Computer Dealer News, covering Canada's IT channel community.
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