First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.
What's on HP's software shopping list?
- — 24 November, 2010 05:33
Software provided only about 3 percent of Hewlett-Packard's US$126 billion in net revenue during its fiscal 2010, but newly appointed CEO and software veteran Léo Apotheker wants to change that in a big way.
Speaking during HP's fourth-quarter earnings conference call on Monday, Apotheker indicated he'd like to see the company double or even triple the amount of money it makes from software, both by investing internally and making acquisitions.
HP's software acquisition strategy will particularly focus on BI (business intelligence), one of the industry's hotter sectors of late, analysts say.
At present, HP is like a "BI sandwich without the middle," said Forrester Research analyst James Kobielus. "They've got the hardware, they've got the services, but they don't have the software."
That's likely to change, he said. "Clearly, HP probably will acquire a major brand in established pure-play BI." Apotheker has some experience with major BI acquisitions, having served as CEO and in other executive roles at SAP, which spent about $6.8 billion on Business Objects in 2007.
MicroStrategy is "definitely a strong possibility" for HP to buy, Kobielus said. "It's global, a really good company with good products."
But MicroStrategy is maintaining "a laser focus" on core BI capabilities like reporting, which are becoming somewhat commoditized, he added. Therefore, HP may also invest in growing niches such as data mining and predictive analytics, where vendors like KXEN or Angoss are potential grabs.
HP might also be tempted to buy sellers of technologies that complement BI, such as data integration vendor Informatica, according to Kobielus.
Data warehousing giant Teradata is another potential target, since HP's own Neoview platform has struggled to make major inroads in that market.
But HP needs to do more than simply buy up a string of software vendors, Kobielus added. It will get the most value from acquisitions through product bundling and integration with other assets, particularly its own technology for systems and server management. "That's their ace in the hole, if they want to go there," he said.
It seems less likely that HP will attempt to get into something like ERP (enterprise resource planning) applications, according to observers. Speculation arose almost immediately after Apotheker's appointment that HP would pursue a purchase or merger with SAP.
"For them to get into applications near-term, that is really too big a leap right now from their core business," said Forrester analyst Paul Hamerman, who closely tracks the ERP market.
That said, "there's some big buying opportunities in some verticals," particularly health care. Oracle is going after the same thing, evidenced by moves like its $685 million acquisition of clinical trials software vendor Phase Forward earlier this year. HP may want to make some preemptive purchases in health care as a result, Hamerman said.
The coming months could also see Apotheker push a strategy involving collaborative "agile business networks," which he called "the next big thing" in an interview with IDG News Service earlier this year, prior to taking the HP post.
"The next big thing is not so much optimizing processes within a company, but optimizing inter-company processes, and it can only be done on collaborative platforms," Apotheker said. The interview coincided with his joining the board of GT Nexus, maker of a cloud-based portal where users share information with customers and partners in their supply chain. Apotheker is still listed as a member of GT Nexus' board.
And 451 Group's China Martens, for one, is not ruling out an applications push from HP. The company could decide to get further into service automation, scooping up "either an older player or a SaaS pure-play like a RightNow," she said.
"There's also the old suggestion of whether HP would be a home for Salesforce.com, to give HP a real foot in the apps world and to give Salesforce.com access to the sales and service firepower it often says it needs to go after more enterprise business," she added.