HP Goes On The Attack With Cisco Switch Trade-In Offer


Hewlett Packard on Monday opened a bold new front in its war against Cisco Systems, launching a trade-in promotion through which VARs see significant up-front savings if they successfully swap in HP Networking equipment for various Cisco switching lines.

Under the terms of the program -- titled "A Catalyst for Change" in a not-exactly-subtle jab at Cisco -- solution providers can save an additional 20 percent up front on the list prices of HP A-Series and E-Series switches, provided they're also trading in an eligible Cisco switch as part of the deal.

The Cisco switches covered by the promotion are the Cisco Catalyst 2960 S-series, Catalyst 3560 E-series and E-series, Catalyst 3750 E-series, Catalyst 4500 E-series, Catalyst 4900 series, Catalyst 6500 series, Nexus 5000 series or Nexus 7000 series. The promotion begins Monday and will extend until April 30, 2011, the last day of HP's fiscal second quarter.

"It's a call to action to our partners and customers," said Frank Rauch, vice president, channel sales, for HP's Enterprise Storage Server Networking (ESSN) group, in an interview with CRN.

The target, according to Rauch, is $9 billion of Cisco networking equipment that according to HP's internal estimates has reached or is approaching end-of-life status. HP is marketing its cost savings claims behind an IDC report from September that indicated total cost of ownership for HP networking solutions is as much as 66 percent less than Cisco.

The 20 percent savings is significant, Rauch said, because it's the first time HP Networking has offered a promotion where solution providers see their discount up-front, instead of as, say, a rebate.

"That's obviously a big part of this, and it's way above and beyond what we normally offer," Rauch said. "We think this is coming at the right time [for partners]."

HP has spent much of 2010 sharpening its attack on Cisco's entrenched networking business, including the aggressive recruitment of the country's top networking VARs, systems integrators and carriers. According to Rauch, HP since the spring has recruited 20 of the country's top Cisco Gold partners to add HP Networking to their line cards, and certified some 200 Cisco Certified Internetwork Engineers (CCIE) on HP Networking.

Rauch also pointed to strong earnings for the HP Networking segment -- 300 percent year-over-year in revenue thanks to the 3Com acquisition, and 50 percent in ProCurve products -- its success against Cisco in recent data center deals, and growth of HP Networking sales with all five of its major distributors.

Rauch said HP had already briefed a number of partners on the promotion and that HP had timed it for this week as a way to capture year-end spending and hit the ground running in calendar 2011.

"There's a lot of budget that's going to be spent between now and the end of the year, and also the end of our [first] quarter," Rauch said. "We want to take advantage of that, and get off to a fast start this year."