In 1984 HP was embroiled in an internal conflict over the future of
the business computing arms of the company.  The need for a 32 bit
successor architecture to the HP3000 was clearly in evidence as
DEC VAX and IBM series 38(?)contested for dominance in the mid-
range market, the only segment address by HP's business systems.
While DEC had DECSYSTEM 10/20 and IDM had its OS/360-MVS
systems for high end users HP had no offerings in those area, while
DEC RAINBOW and HP's 120 CPM and 150 DOS machines were
already  fighting an uphill (and ultimately futile) battle against the
already ubiquitous IBM PC XT/AT open architecture.

The cancellation of VISION and the sputtering efforts of
SPECTRUM seemed ominous to many HP3000 users, a good
number of whom were still running Series II and III boxes and 792X
series disc drives.  Yet despite a pressing need for a revolutionary
reassessment of how HP addressed the business computing market
overall, HP was still concerned about the effect the the HP150 with
its graphics capability and relatively low cost was having on the
Terminal division.

In this environment HP made the fateful choice to introduce the
LaserJet printer, based on a Cannon engine.  Perhaps choice is the
wrong word here.  In 1984, because Xerox turned them down,
Cannon offered to licence their laser printer technology to HP.  HP
produced the Cannon based product and within three years
managed to move about 500,000 of these things (one of them to
me) at about 1.5 times the cost of a high end IBM PC.  This was
serious money.

At this time PC desktop systems were still viewed as little more than
toys.  True there were all sorts of networked operating systems
begin developed and marketed, Novell and Banyan being but two of
the most notorious, but the capability and reliability of PC based
computing was far below that available in the mid-range machines.
The LaserJet's initial success took HP by surprise and coming as it
did during a critical period of re-evaluation of HP's future in
computer perhaps had a disproportionate effect on subsequent
events.

There is considerable evidence given the design of the LaserJet and
LaserJet II families that these machines were seen as giving HP's
business computers, specifically the HP3000, a competitive edge in
the mid-range market.  These machine could be driven directly from
the HP3000 spooler without any special hardware or software, a
capability removed from later LaserJet families.  However, by this
time the HP150 had died a lingering death and Spectrum, now
christened MPE/XL, was in 1987 only a dim, almost spectral, reality.

This was no doubt a serious disappointment to HP's senior
management and probably brought to mind the fiasco that had
accompanied the introduction of the original HP3000 just 15 years
before.  Could it be deja vu all over again (to quote Casey Stengel)?
Even into late 1988 the new HP3000s were more spoken of than
seen and then only by outsiders. HP itself was curiously reticent on
the entire subject of Spectrum and the near mythical 930/50 series.

I believe that this experience contrasted poorly with the massive
success of the LaserJet and its progeny.  As noted above the HP
150 like the DEC Rainbow had, by 1989, already slid off and died in
obscurity.  The IBM PC architecture on the other hand had moved
rapidly through the 286 phase and the then new intel 80386 based
machines were beginning to make networked based computing look
like a potential winner.  Apple was still making waves with the Mac,
but holding on to control of its hardware architecture with a death
grip that was strangling the product in its crib.

HP was (and remains) cursed with its lethargic internal business
model that refused to recognize that revenues from HP hardware
and software contracts could legimately be used to fund product
enhancements (Business Basic anyone?).  Instead they insisted on
new sales paying the freight for these investments.  Faced with
increasing buyer resistance to the high initial cost of their
computers, HP took a common approach chosen by many firms
who find that their market has changed because they were not
paying attention to it; they cheapened the product by reducing its
value, unbundling Image.

Now there was more to this than just creating the illusion of a cost
savings to potential buyers.  Image was in direct competition with
Allbase, HP's much touted, over sold, separately priced, and under
performing replacement for the old database manager.  Allbase was
"relational", while Image was, well just what the h*ll was Image
anyway, besides old?  In any case the decision to remove Image
from the cost of a new HP3000 caused massive unhappiness in the
established customer base, scorn from industry observers, and
confusion for just about everyone else.  What it did for sales of
HP3000s must have been slight or negative for the decision was
quickly reversed and the responsible parties moved far from CSY.

At this point, HP seems to have straightened itself out about the
HP3000 and settled in for a steady run of production and
development for the HP3000/9XX series increasingly reliable and
useful GP business computers.  Computers that more than held
their own against all comers.  However, the rot was in and laser
printing, now seconded by inkjets, accounted for the bulk of HP's
sales and profitablity.  The PC revolution was reaching its take-off
point with the introduction of the Intel 80486 whose clock speeds
reached over 100MHz by the time its replacement, the Intel Pentium
was introduced in 1995.

By 1996, following Microsoft's introduction of Windows for
Workgroups and NT 3.5/3.51 Advanced Server the previous year,
PC based distributed network computing was a reality, if still very
rough around the edges.  HP was now working both sides of the
fence, still moving HP3000's (and much larger numbers of the more
specialized HP9000 Unix boxes) but increasing numbers of Intel
based Netserver products as well.  HP's business model remained
unchanged, support revenues flowed to the support division, new
sales funded R&D for CSY projects.  This practice kept the price of
HP3000's high in relation to their competition and limited the number
and types of projects that CSY could undertake.

Increased advocacy from the installed base resulted in major
improvements to many of the fundamental systems that shipped
with the HP3000, including the introduction of a Posix compliant
version of MPE/XL renamed MPE/ix with release 4 in 1992.  But this
in hindsight was a warning in itself.  The enhancements were of
grate value to those already using the machines, but of little interest
to new clients that had since the 1990 introduction of Windows,
extensive experience with computing using a graphical user
interface.  Whereas a different funding model might have made it
possible for  CSY to produce a windowing product to disguise the
HP3000's text based ancestry, the money was not there and by this
time neither was the desire.

By mid-decade the writing was on the wall for mid-range computers.
A price model that would not adjust to the realities of commodity
traded hardware resulted in declining sales, even to the established
customer base, and virtually no sales at all to new sites. The cost of
the development tools remained ridiculously high. The Apple Mac
was all but vanquished in the desktop business market and outside
of the  Unix market, Intel based servers, although primitive and
limited in capability, seemed to be where all the action was; at least
for firms like Digital and HP.  When DEC quietly died in early 1998,
swallowed up by one of the early IBM PC clone manufacturers, the
future of the HP3000 was sealed.

Although I, no doubt like many others who had experienced the
"DEC has it Now campaign" of 1985-86, felt a certain satisfaction
that this smug and condescending competitor of HP had met a
deserving and ignoble fate, a shiver of premonition nonetheless
passed over me.  It was about this time that the user clamour for
reassurance the HP3000 would not  "go away" became pronounced.

However, outside of IBM who had conceived of the AS400
architecture as a GP hardware platform capable of supporting many
OS implementations, the loss of DEC marked the end of history
insofar as the mini-computer was concerned.  Outside of Unix
based servers, Microsoft and Intel now dominated and shaped the
business computing environment for mid to low end users.  The
sheer size of this growing market ensured that they would have a
major impact on the upper ends of business computing as well.

Within three years of DEC's passing HP itself decided to abandon
the HP3000 and shortly after that it acquired Compaq, finally
devouring the remnants of its old rival, DEC, but irrevokably tying
HP to the Intel Micorsoft future.

There was never any point before the very end that HP consciously
or unconsciously decided against the HP3000.  That final decision
was the result of thousands upon thousands of decisions taken over
the course of many years having no direct connection with CSY or
the HP3000 but cumulatively resulting in their termination as viable
business ventures.  HP, despite my personal revulsion over the act
itself, behaved in a sober and conscientious fashion in the case of
terminating the HP3000, giving their clients five full years to find
alternatives.  This is far better than simply closing the doors or going
out of business.

However, my belief remains that had HP had more progressive
internal policies regarding revenue distribution then the HP3000
might have survived as a genuine alternative to Intel Microsoft
servers.  The many decisions that negatively impacted the HP3000
were themselves often the product of poor internal business
practices that prevented such opportunities that did exist from being
exploited.


However, this is just my opinion.

Regards,
Jim


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James B. Byrne                Harte & Lyne Limited
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