HP Places Big Bet On Channel Storage Investments

"We are doubling down on our storage investments in 2008," said HP Americas Channel Chief Adrian Jones. "We are absolutely doubling down." That means HP will take the 38 percent increase in storage investments it made in 2007 and double it in 2008, said Jones.

"We want to see significant growth in storage," said Jones. "We are not happy being the number three player in the storage market." Part of those investments include a new initiative that starts March 1 aimed at paying New Business Opportunity (NBO) incentives for partners selling storage and servers up front rather than a back end rebate.

Tom LaRocca, vice president, marketing and strategy for HP, said the new program will provide partners will see millions of dollars per quarter in improved cash flow. That should translate into increased storage sales in the field.

Additionally, HP combined the NBO registration and deal registration into a single Web site so partners will not have to enter the same sales data twice. He said that is a "huge" simplification for partners.

HP also formally announced a new Storage Select Authorization to get more SMB partners who are selling HP Blade Servers to sell storage products, namely the the HP StorageWorks Enterprise Virtual Array 4400 (EVA4400) and the entry level EVA4X00 Series. HP had previously run the Storage authorization initiative as a pilot program and added some 130 new partners. At the time the program was announced some HP enterprise partners feared that it would cut into their sales. But Jones said HP policed the program and saw a huge increase in incremental storage revenue, said Jones.

HP Tuesday also unveiled a new HP StorageWorks 4400 Enterprise Virtual Array aimed at the midsize market.

"There is tons going on in the storage community at HP, changes with people, resources, technology and products," said Jones. "I know partners want it tomorrow. I think at the end of the day we still have a body of work to be done in that business. But I will tell you it is changing rapidly inside of HP. There is a huge renewed focus in the last year from (HP CEO) Mark (Hurd) all the way down. Come back and ask me in six to nine months where we are in storage."

Bob Venero, president and CEO of FutureTech, a New York headquartered VAR 500 solution provider, said HP is making it easier and more profitable to sell its complete portfolio, including storage. He said HP is at least 20 percent better at partner program and processes than the competition.

"HP is the best out there in driving attach (rate) profitability," said Venero. "No one else is really doing that. That's because HP has the the broadest product portfolio. From our perspective that makes a big difference. IBM used to have that ability with PCs, servers, storage and software. But they changed their model."

Venero, who partners with all the major vendors, including IBM and Dell, said Dell is attempting to follow HP's lead and drive that broad portfolio coverage with the channel. "They have a big challenge in doing that against HP," he added. "HP is far ahead of the pack."