The changing technology vendor landscape

We read with interest the various articles about the upcoming acquisition by HP of 3Com. The comments varied from viewpoints that this was a 1-2 combo that would finally give Cisco some real competition, to ones where the acquisition fills in gaps in HPs product portfolios and leverages it strength in its networking portfolio.

One of the major points that we did not see in any of the articles were any comments on the fact that 3Com has fairly mature products in areas that HP does not, i.e. products in IP telephony PBXs, wireless hubs, routers, switches and antennas and even network management software tools, all geared to the SMB marketplace.

Cisco has not been strong in enterprise class IP telephony solutions scaled down to the SMB markets when compared to 3COM. Yes, they have lower end router/switch products, but have not really addressed the SMB markets in voice products, other than their hosted IP Telephony IP Centrex type products that they sell through various carrier channels.

This acquisition also highlighted the growing trend by tech companies to move into new spaces to continue to grow revenue, for example:

· Dell buying professional services company Perot Systems Inc.

· Cisco developing blade computing servers

· HPs acquisition of EDS last year, etc.

What does it mean to HP and 3Com?

While working for HP in the early 90s, I got a chance to understand the organization from a culture, products and quality perspective.

Many of us within Fox Group have also been a part of 3Com consultant and analyst programs, as well as having analyzed, tested and installed their SMB products within our own facilities.

The 3Com organization and culture is very similar to that of HP, disregarding the difference in size of companies. We believe that this will make the consolidation and transition much easier, smoother and faster than other consolidations we have seen or been a part of in the past.

What does it mean to Cisco?

This acquisition has two fronts to Cisco…the first one from the perspective of their long standing strategic relationship as partners. We anticipate that this will be seriously strained, and may not survive. The other perspective is from the expanded HP networking portfolio. The 3Com acquisition fills in product voids that HP has, but also that Cisco is not strong in at the present. As can be imagined, this will probably change in the future as Cisco is able to acquire and expand product portfolios very quickly when they feel it is necessary.

What does it all mean to us as SMBs and mid-sized customers throughout the world?

HP will be able to leverage their global channel relationships to sell and distribute the 3Com products, particularly in Canada and the US.

HP will also probably consolidate the complimentary 3Com products into the HP fold, and be able to have SMB products where they didn’t before, i.e. network management, wireless LAN data and voice, i.e. 3Com NBX/VCX IP telephony suite, low cost network security products, and unique LAN jack products like the 3COM Intellijack 4 port smart switch that fits into a standard electrical wall outlet.

We are confident that both companies will continue to add, change and evolve product portfolios over the next year or two at an accelerated pace in order to capitalize on the pent up technology spending in all sized organizations.

Over time, we will have an alternate choice to Cisco as the dominant network manufacturer from HP. When you combine HPs strength in computing and peripherals such as printers, monitors, etc., HP may just be able to be the ‘one stop shopping’ vendor that many of us as SMBs have dreamed about!

We believe it will be good for all to have more competition in this space. Competition drives innovation, creativity and better pricing, which is always good for us as business customers.

Would you recommend this article?


Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.

Jim Love, Chief Content Officer, IT World Canada

Featured Download

Related Tech News

CDN in your inbox

CDN delivers a critical analysis of the competitive landscape detailing both the challenges and opportunities facing solution providers. CDN's email newsletter details the most important news and commentary from the channel.