Tuesday, June 1, 2010

HP Getting Ready to Bid NMCI Replacement

Could NMCI to Be Replaced by Private Cloud, with Desktop-as-a-Service?

Hewlett-Packard said on June 1, 2010 that it will cut 9,000 jobs over three years and invest $1 billion to focus on new efforts like private cloud infrastructure and desktop-as-a-service. Think of it as phase two of the EDS integration with an emphasis on delivering IT as a service.

The move comes as HP has largely completed its integration of EDS. HP said in a statement that it will build next-generation platforms for its enterprise services business. In a nutshell, HP will consolidate its commercial datacenters, management platforms, networks, tools and applications to create a more automated infrastructure that it will use to serve enterprise services customers. With its next-gen datacenters, HP is hoping to boost services margins.

Implications

  1. The cut of 9,000 jobs, mostly from EDS reflects the labor intensive NMCI operations.
  2. Desktop-as-a-Service means mostly thin clients.
  3. The potential HP re-bid for NGEN will most likely cost >$1 billion less over a five year period than current spending.
  4. This announcement should be seen as HP's posturing to bid on NGEN when the current contracts expire.

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