Users wary of HP plan to boost software business


Hewlett-Packard last month added a new business unit in its HP Software division that will oversee the company’s business intelligence and information management offerings.

The BI arm of the new Business Information Optimization unit will sell internally developed data warehousing technology, said Ben Barnes, the newly appointed vice-president and general manager of the BI group.

Some HP users said they are dubious about buying key software products and services from a company that specializes in developing and supporting hardware products. Ashok Bakhshi, IT director at Schindler Elevator Corp. in Morristown, N.J., said that his firm “would not normally go to HP for that type of support. It is not their forte.”

He added that any proposal from HP to use its data warehouse software “would have to be extremely compelling from a performance and business-value standpoint before we would make the switch out of SAP.”

Bill Kehoe, CIO of the Washington Department of Licensing, said that the state agency has a BI project under way that is based on Microsoft Corp.’s SQL Server database software. Although the department is a big user of HP server and desktop computers, it wouldn’t seriously evaluate the vendor’s software before taking the time to see how HP’s services compare with those of other vendors “who have more [BI or information management] experience,” he said.

HP began shipping one of the unit’s key products, the Neoview data warehousing offering, in October.

Officials have declined to name any companies other than HP itself that are using Neoview.

Henry Morris, an analyst at market research firm IDC, said that HP has long been involved in the BI business, because it provides servers that IT operations use to build and run data warehouses.

Morris said he expects HP to rely on partners such as Cognos Inc., Business Objects SA, SAS Institute Inc. and Hyperion Solutions Corp. for the BI tools used for reporting and analysis, unless it moves to purchase such a vendor.

“There is much more to be gained in terms of overall revenue from services,” said Morris. “Generally speaking, for every BI project, services are the most expensive [component], because expertise is in short supply.”

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