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A one-stop solution shop

The launch of the HP ProCurve Open Network Ecosystem (HP ProCurve ONE) multi-vendor alliance program on January 26th this year signalled HP’s strategy to offer one-stop solutions for network infrastructure in partnership with other major technology companies. More significantly, it sends out strong signs that HP is now aggressively looking at expanding the market opportunities for the ProCurve portfolio, after years of partnering with Cisco in data centre environments.

Now, part of the HP Technology Solutions Group (HP TSG), HP ProCurve is an organisation promoting solutions, products and services for wired and wireless networks.   HP ProCurve recently significantly expanded its wireless portfolio with the acquisition of Colubris Networks which provides wireless products with 802.11 n capabilities.
HP, a fixture for decades in data centre server racks, is broadening the role of its ProCurve networking arm in compute-intensive environments. Together with products from its multiple technology partners, HP is looking at fulfilling complete network infrastructural needs of datacentres and enterprise customers.
HP says the ProCurve ONE approach "delivers business value by increasing the efficiency of network applications". Technology leaders such as Microsoft, Avaya, McAfee, F5 and Riverbed are part of the program.
In January this year, HP ProCurve unveiled its first switches built specifically for data center applications, as well as a server module for existing switches that enables users to begin integrating and consolidating switching and application processing.
According to Marius Haas, senior vice president and general manager, HP ProCurve, "To help customers address the increased pace of change within their businesses, HP ProCurve is combining its own technology with some of the most innovative, respected and visionary companies in the world."
Using HP ProCurve’s open networks platform as its foundation, HP ProCurve ONE allows customers to securely integrate a wide choice of best-in-class network applications and services from alliance partners that integrate directly with HP ProCurve infrastructure.
It is one of the first outcomes since HP’s decision to integrate the ProCurve business with its TSG portfolio. ProCurve has seen its business worldwide grow at a significant pace and has emerged as a strong competitor to Cisco which still has a large lead in the networking market.
 “The objective is to get the best of breed components as part of the solutions that we deliver. We have partnerships with other technology leaders in their segments such as Avaya for IPT, Microsoft for communication software and so on with every layer. We integrate their components into a network module wherein the customer gets a completely tested and validated integrated package. The customer does not run the risk of integrating modules separately sourcing from different suppliers,” says Alaa AlShimy, General Manager of HP ProCurve Middle East .
The ProCurve ONE Services zl Module announced in January for HP ProCurve’s 8200 and 5400 zl switches runs software applications from Microsoft (security and network access), McAfee (Web security, filtering and IPS), Avaya (unified communications), F5 Networks (application delivery control and load balancing), Riverbed (WAN optimization), and others.
Bucking the slowdown
In a market that saw shipments decline for the majority of vendors of Layer 2 through Layer 7 switched ports, HP ProCurve grew at a 20 % rate year over year from the fourth calendar quarter of 2007 to the same quarter of 2008. The industry rate for this period declined by 1.6 %, according to the report.
HP ProCurve’s Layer 2 and Layer 3 total Gigabit worldwide port shipments grew 35.1 percent year over year compared to market growth of 8.6 %. HP ProCurve’s Power over Ethernet (PoE) worldwide shipments grew 32.4 % year over year compared to market growth of 8.6 %.
In Europe, the Middle East and Africa, HP ProCurve grew at 24.3 % in a market that declined 3.6 %. Post integration, the TSG portfolio for the enterprise looks meatier and a strong leverage against its competitors including Cisco which recently made a surprise fory into blade servers.
Alaa AlShimy says, “Since the integration with TSG, the strategy is to move at a great speed into the enterprise segment. With this realignment, we can look at increasing the number of customers in the enterprise segment especially.”
Al Shimy keeps reiterating the fact that the big advantage for them under the new structure is the capability to position as an end to end solutions provider.
 “We are providing end to end solutions for different sectors including banks, manufacturing and more. An end to end solution needs different components- the hardware, software , applications etc. We want to take a complete end to end solution to address the data centre needs.”
He adds, “Networking is one of the things we do. We are a solutions company and provide all components to it. We do not go out customers to sell routers or switches. We go to understand their business needs to help design end to end solutions.”
The company also wants to be seen as extremely customer friendly. Price performance is one of the attributes that ProCurve products have built a reputation on in the market but Al Shimy insists there are other benefits that help their value propositions stand out.
He says, “We are better off than our competitors on price performance. People buy not because of the price but because the solutions we provide help customers become more competitive by helping them run their applications better. We have very durable products and they have a lifetime warranty. Customers have support direct from HP for free. If there is a product that we do the replacement and ship the defective one for free.”
Al Shimy adds, “The risk in buying different solutions from different suppliers for storage, networking etc is that there is a lot of time talking to different points of contact for support needs. Here, he needs to talk to just one entity which is TSG. The customer needs to deal with one supplier who understands his business needs and translates that into an IT solution and helps implement a solution which gives a competitive advantage.”
Channel strategy
The go to market model is similar to other HP units. There are large named accounts and while HP is directly involved in generating leads as well as consulting with potential customers, Al Shimy insists, all of the business fulfilment is actually partner driven.
Al Shimy says, “There are about 200 named accounts we engage with, in the region. We go to them and talk about our solutions, understand their business requirements and propose end to end solutions. However, 100 % of our business comes from partners. They fulfil the orders. We position and generate demand. But we don’t sell which is done through partners. That is the added value we bring to partners.”
He adds, “We have introduced new services that can be delivered by partners or HP directly 24 by 7. Our first is always that the partner gets the preference to fulfil the service unless the customer is insisting and there is the possibility that otherwise it could go to the competition.”
So is he happy with the growth? Al Shimy seems to be confident that they will post good growth this year as well, although it may not be as per expectations.
He says, “Compared to last year’s Q 1 numbers, we have grown in Q 1 this year by 30%. But yes, we may not have grown to the extent we aspired. We have had a couple of very good years and we expect to grow on a similar scale but 2009 could be different.”
The realignment of ProCurve has also meant realignment for partners. Some of them who were not active were removed from the list. But for many existing partners from either TSG as well the ProCurve structure, they now have a broader portfolio to sell.
Al Shimy says, “We want to be very selective in the kind of partners that we have. Every HP TSG partner will have an advantage when he starts selling ProCurve also. Similarly for existing ProCurve partners, they can add other TSG products. We have 120 partners across the region. ProCurve networks specialists would number about 25.”
With a diverse partner profile, the company is well placed to tap into traditional strongholds including Oil & Gas, education, government etc. At the same time, there is the intent to invest more resources in tapping more verticals including more public sector prospects.
 
 
 
 

HP has strengthened its TSG portfolio with the integration of the ProCurve unit into it

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