Users take cautious stance on merger

Corporate end users of Hewlett-Packard Co. (HP) and Compaq Computer Corp. systems are split almost equally for and against the merger of the two companies. But almost half of the 243 IT managers surveyed said they were undecided and would give the merger the benefit of the doubt, research company Technology Business Research Inc. (TBR) said Wednesday.

The survey reported that 29.6 per cent of users were in favor of the merger, compared to 24.3 per cent against, with 46.1 per cent saying they were undecided.

But reaction to the merger was more favorable with regard to the effect of the merger on IT departments. Almost 60 per cent of respondees said the merger would have a positive or neutral effect on their IT organization, compared to 9.5 per cent who felt there would be a negative impact, TBR said in a statement.

Good news for HP and Compaq lay in the 66.3 per cent of users who said they would not consider switching to a new vendor, suggesting the cost of a switch far outweighed the risks associated with the proposed merger. Only 14.4 per cent of the surveyed IT managers said they would actively consider switching vendors as a result of the merger, TBR said.

Users also felt confident that the post-merger management team could successfully integrate the two organizations with 48.6 per cent of respondees believing the team could succeed compared to 17.7 per cent who did not.

But the large proportion of users who remain undecided about the merger means that top executives will have to provide “post-merger execution excellence” to make sure of hanging on to their customers, TBR said.

TBR said its independent survey was not conducted on behalf of any corporation, organization, fund, brokerage firm, director, stockholder or individual. The 243 end-user companies surveyed have an installed base of over 1 million PCs between them, TBR said.

TBR, in Hampton, N.H., is at