HP To Drop Some Software Lines

The decision affects nearly 500 people in HP's middleware division in Mount Laurel, N.J. Some employees will find work elsewhere in HP, and others will be laid off , though the cuts will be part of the 15,000 already being carried out because of the $19 billion acquisition of Compaq Computer Corp., an HP spokeswoman said Monday.

The discontinued products are middleware, which is necessary for Internet-based business applications. Most of the technology came on board when HP bought Bluestone Software Inc., the company said.

HP hoped the Bluestone products would invigorate its software business and support the company's bid to offer a wider array of Internet services to large companies. The software was designed to work with proprietary products many networks already employ, including rival technologies made by Microsoft and Sun Microsystems.

But the products have not been as successful as HP would have liked. HP will stop trying to sell that middleware itself, and instead will offer products by Microsoft and BEA Systems.

"Why compete and try to gain market share from those two leaders? Why not form tight partnerships and concentrate on the areas where we can be No. 1 and are No. 1?" the spokeswoman said, referring to HP's own OpenView software and other network-management applications that will remain.

In trading Monday on the New York Stock Exchange, shares of Palo Alto-based Hewlett-Packard fell 27 cents, or 1.8 percent, to close at $15.

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