ANALYSIS
A: I couldn't be more pleased. I'm getting kudos from our employees, partners and everyone. They're blown away! They are impressed by the level of detail and information we have provided on the merger. We have made the hard decisions up-front. Now we will organise and execute. I will be meeting with multiple layers of managemenet over the next couple of weeks. Before the merger you were in charge of storage at Compaq, and before that, you were at Digital when it merged with Compaq. How does this merger compare with the Compaq-Digital one?
There is no comparison with the Digital merger. I was in charge of PCs and NT servers at Digital, and was asked to run the combined storage operation. We are easily six months ahead [of Compaq at the equivalent stage of its take-over of Digital]. It took a year for Compaq to integrate the sales management. We are six to nine months ahead of that, thanks to the clarity of the roadmap. In some parts of the roadmap you have been very clear, choosing one product or brand over another. For example, in servers, the announcement that Tru64 and Alpha have a limited lifespan is a tough announcement, but it has been made quickly. How are you presenting that to customers?
We have been pragmatic. Nothing falls off a cliff. We have made our decisions to avoid internal competition. But we understand business customers. We will make sure the customer has continuity. Each customer will deal with specific sales people. So, for example, with Compaq Tru64 customers who wish to make best use of that product, we will work out the best plan for each customer. If they want to move to HP-UX, we will work out the best way to do that. We will begin cross-training for our staff in thirty to sixty days, so each salesperson can understand all the options. But what about areas like your own: storage? In that plan you seem to be keeping both sets of products. The Hitachi Data Systems Lightning product that HP resells as XP, overlaps substantially with the Compaq StorageWorks EVA product. How can you keep selling both?
This is actually a customer-centric position. The two products may overlap but they are different kinds of solution, with different kinds of customer. Some customers are comfortable with monolithic data storage, which gives them the highest scalability. They will continue to want the XP product. XP is absolutely right for a mix-and-match between open systems storage and legacy storage, and for a traditional consolidated enterprise. Others want more modular storage, with a lower entry price and building over time to the same performance as the XP. They will prefer the Compaq EVA systems, which scale horizontally, instead of in the box. Customers will appreciate that choice: it is like the relation between Unix and NT.
