Customers Will Expect Both to Handle Services

By Chris Preimesberger  |  Posted 2010-02-19 Print this article Print

Enderle said customers generally expect large services organizations like HP's and Cisco's to be able to service everything.

"This puts stress on that organization, but these problems have been common with IBM Global Services as well when applied to competing server or PC products (back when IBM did PCs)," Enderle said. "So, while not ideal, IBM Global Services was able to step up and still cover their clients.

"I expect HP will be able to as well, but I also expect that the related accounts, if they stay with HP, will drift toward HP products or neutral offerings and away from Cisco over time to avoid this aggravation."

King said he thinks both companies probably will have to work harder to keep customers satisfied.

"[Customers' biggest pain point will] probably be sorting through their HP and Cisco SLAs [service-level agreements] to determine just how exposed they are," King said.

Laliberte had a different point of view about customer issues.

"In the short term, customers potentially may have to work with another vendor," Laliberte said. "If they purchased everything from HP, they may now be forced to bring on another vendor to procure Cisco products. This might impact volume discount levels, etc.

"Potentially working through support issues may also be a worry, although I doubt this will be a problem. Both of these vendors know they need to take care of their customers. In the long term, this may be a positive for customers, as HP's challenge to Cisco's networking dominance will drive innovation, choice and perhaps even better pricing, but they need to execute."

There is a cost to going into competition with a firm that is also a large reseller and service organization, which is rarely factored in completely to new product-area decisions, Enderle said.

"This is because the folks doing the analysis are generally paid by the executives who want a 'yes' answer. Going into servers will be very costly to Cisco over time; we'll see if the eventual additional revenue was worth it," Enderle said.

Canter pointed out that both Cisco and HP have invested significant resources in building their alliance, and that it's not going to end that quickly.

"A mark of a sophisticated alliance organization is that they can end an alliance when it no longer makes sense strategically and still have enough relationship and social capital between them so that they can work together in the future and in other ways," Canter said. "Both companies are well-versed in alliance management, so they have likely thought through how to end the alliance in a mutually beneficial way."

Finally, King of Pund-IT provided the last word:

"Given the rapid evolution in enterprise IT solution development and the continuing rise in industry-standard technologies, I doubt this will be the only such break-up we'll see. Too bad. They were such a lovely couple."

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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