Arrow Sees Upkick in HP Business from VARs Awaiting Merger
SBM, Arrow's HP-focused unit, didn't target Compaq players in a recent marketing campaign but nonetheless received the biggest response from that group, said Joe Burke, vice president and general manager of midrange business at Arrow.
"I think it was a defensive interest. They're not looking at IBM or Sun [Microsystems," Burke said. "They're saying, 'If this [merger is going to happen, maybe we ought to get familiar [with HP in advance.' It's a proactive move [for many in the Compaq reseller base."
Both HP and Compaq told Arrow to proceed as if the two vendors are still competitors while the merger goes through the approval process, Burke said. That left each company as fair game.
"Our SBM business is designed to grow HP, and that's what we're trying to do," Burke said. "[HP and Compaq are not upset about these moves. They think the merger is going to happen, too."
Arrow would not provide exact numbers, but a source close to the company said about 30 of 80 prospects signed to add HP products to their line cards during a recent SBM marketing campaign.
"It's a very high number for a midrange [campaign. Solution providers don't just add another platform for the heck of it," the source said.
Daymark Storage Innovations was buying Compaq through Arrow/Wyle and called SBM proactively to sign up with HP, said Rich McGhee, co-founder of the Salem, N.H.-based solution provider.
"We're excited about what HP brings to the table with Itanium because a new focus in our business is on Linux," McGhee said, adding that the decision was researched at all levels of the organization.
"We didn't want to get caught flat-footed, should the merger come and Compaq is engulfed by HP. We don't have an HP relationship and might be on the outside looking in," McGhee said.
Daymark has no intention of dropping Compaq unless it is told to do so, McGhee said.
"We have existing customer base that is heavily involved with the higher-end [Compaq Alpha products," McGhee said.
E-deltacom, a Compaq and Sun reseller, sought another platform after gray-market activity decreased its Sun sales 50 percent in the past year, said Steve Johnson, senior vice president and general manager at the Suwanee, Ga.-based integration arm of ITC Deltacom, a CLEC. When the HP-Compaq merger was announced, E-deltacom decided HP was the perfect choice, he said.
"We felt we needed to embrace both [HP and Compaqearly and not later," Johnson said. "We are getting our guys up to speed with HP-UX and also trying to understand HP's storage offerings and how they're different from Compaq." E-deltacom plans to keep all three Unix platforms, Johnson said.
"We don't know which product lines will survive going forward. Will they adopt [Compaq's Tru 64 for the operating environment or HP-UX?" Johnson said. "We're trying to embrace all of them and let Compaq and HP decide which one they want to use."
One e-Deltacom customer was concerned that Compaq support would vanish after the merger, but that issue was resolved with Compaq's help, Johnson said.
"I did not want to put myself on a limb with a customer and not be right, so I called Compaq and said we have a $500,000 StorageWorks opportunity and we're competing with all the other storage manufacturers," Johnson said. "The Compaq people did an excellent job convincing [the customer of the long-term investment."
Solution providers also are concerned about the integration process, especially after the Compaq-Digital Equipment closure failed to meet many partners' expectations, Burke said.
"HP and Compaq are under the gun of acquisitions past, but they have made decisions and are prepared to execute and answer questions promptly and efficiently," Burke said. "Resellers look for clarity and predictability. [HP's Hard Deck remains, or we've been told it will. That's a good sign,a good start."