Hewlett Says Plan for PC's Is Corporate Money-Saver

June 3, 2003
By STEVE LOHR


Hewlett-Packard plans to announce a technology initiative
today that it says can reduce a corporation's cost of
owning and managing personal computers at least 45 percent,
by shifting processing power to a central bank of shared
computers.

The new effort, to be discussed at a meeting with industry
analysts in New York, is part of Hewlett-Packard's drive to
use its sizable investments in research and software to
gain an edge on its chief rival in the personal computer
business, Dell Computer.

Hewlett-Packard, helped by its acquisition last year of
Compaq Computer, is about even with Dell in worldwide
market share. But Dell - known for tight cost controls,
extremely efficient operations and minimal research
spending - has been gaining ground despite the lingering
slump in the technology market.

Hewlett-Packard's strategy is to strengthen its personal
computer business with superior technology, which is how it
is positioning today's announcement.

"There's still a lot of room for innovation in desktop
personal computers if you look at the field broadly,
especially the problem of reducing total cost of
ownership," said Shane V. Robison, the company's chief
strategy and technology officer.

The Hewlett-Packard technology is a fresh attempt to tackle
the longstanding problem of managing and maintaining many
desktop computers in corporations. Analysts estimate that
hardware and software purchases account for only about 20
percent of corporations' overall costs of owning personal
computers. The remaining 80 percent lies in labor-intensive
tasks like training, help-desk support, systems management
and upgrading software.

The Hewlett-Packard solution uses clusters of "blade"
personal computers - each a narrow circuit board that
handles all the processing chores of a desktop PC. The
blades are housed and managed at a central location in a
corporation. Likewise, each user's files are stored
centrally in a network of disks.

Users sit at workstations - each with a screen, a keyboard
and some local memory - sign in with passwords and gain
access to both processing power and individual work files.
Each worker gets a PC blade, but not always the same one.
The processing resources are allocated by Hewlett-Packard's
OpenView software, developed over years and used for
managing workloads in corporate data centers.

The company saves money because not all PC's are used at
once. So if a company has 10,000 workers and the maximum
use at any time is 70 percent, the company might be able to
buy a system with only 7,000 blades instead of 10,000
desktop PC's.

There should also be large savings, according to
Hewlett-Packard, from cost reductions in maintenance,
management and training that result from its centrally
controlled approach.

The idea of using "thin client" computers on desktops
instead of full-fledged desktop PC's is not new. The
thin-client effort was pushed hardest by rivals of
Microsoft, led by Sun Microsystems and Oracle, in the
1990's. But that effort never went very far.

The Hewlett-Packard approach, however, will use Microsoft
desktop software - Windows and Office - that is familiar to
most workers.

Corporate PC users, industry analysts noted, have been
reluctant to give up the flexibility and freedom of being
able to modify or add personal software to their own PC's.

Analysts also were skeptical of Hewlett-Packard's
cost-saving claims without further details. "But the H.P.
stuff does kind of fit into the moment, where corporations
are moving much more to centralized and standardized
computing environments," said William Kirwin, an analyst
for Gartner Inc. "This has been tried before, but the world
is changing. This time, maybe H.P. has it right."

Spokesmen for Dell and I.B.M. said their companies have
looked at PC blades and a more centralized provision of
personal computing like the Hewlett-Packard approach. But
they have not moved in that direction, saying the market
for such an approach would not be great.

Hewlett-Packard, based on its prototype work and talking to
some customers, does not agree. "We see an opportunity to
change the landscape in the corporate PC industry largely
by taking the expertise we have developed in data center
computing and putting that in the PC industry," said Mr.
Robison, adding that the new technology would be introduced
within a year or so.

http://www.nytimes.com/2003/06/03/technology/03HEWL.html?ex=1055642521&ei=1&en=11c1d2fbc32337ac


Copyright 2003 The New York Times Company


--
Tom Brandt
Northtech Systems, Inc.
130 S. 1st Street, Suite 220
Ann Arbor, MI 48104-1343
http://www.northtech.com/

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