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HP VARs Wary Of Storage/Server Chief Exit

As the vice president of Americas enterprise storage and server sales leaves Hewlett-Packard, HP solution providers are up in arms.

storage server

Gonzalez seems to have been pushed out of HP in the wake of the poor showing of the Palo Alto, Calif.-based vendor's storage business, solution providers said. However, an HP spokesperson would only say that Gonzalez is leaving HP to pursue other interests.

Effective Tuesday, Gonzalez is being replaced by Christopher Riley as vice president, Americas enterprise storage sales, the HP spokesperson said in an e-mail response to questions about the departure of Gonzalez.

Riley came to HP after spending time with EMC Corp., Hopkinton, Mass., and storage switch vendor McData, which last year was acquired by Brocade Communications Systems Inc., San Jose, Calif.

Riley is reporting to Randall Runk, senior vice president of U.S. sales for the company's Technology Solutions Group (TSG).

The departure of Gonzales comes less than three months before Jack Novia, HP TSG's managing director and senior vice president, is scheduled to retire.

Don Richie, CEO of Sequel Data Systems, an Austin, Texas-based solution provider and long-time HP partner, said the changes are making him sick to his stomach.

The departure of Gonzalez and Novia and other people who have worked with the channel for years is cause to worry, Richie said. "The sadness of all the people I've known forever who are now leaving HP is there," he said. "But there's also all the changes going on at HP. I don't deal well with changes. And when you get all that change, and you don't know the new directions, it's hard."

Gonzalez was very much a channel player, and his departure leaves many questions for Richie and his peers, he said.

"What is the channel mentality of the new person?" he said. "Will they recognize the value of certifications and other investments of HP's partners? Or will they think in terms of commoditized storage? Are they going to have a true value-added relationship? Or will HP be more like McData and become a commodity player? Will they make the same strategy changes they did when HP and Compaq moved toward more of a commodity model only to learn later they need to focus on the value?"

Gonzalez seems to have been the fall guy, being pushed out because of HP's storage difficulties, several solution providers said.

"There's too much change going on at HP," said one solution provider, who asked to remain anonymous. "Just too many massive changes going on with Gonzalez and Novia leaving. And there's no light at the end of the tunnel."

That solution provider said that HP needs to come up with a predictable, consistent model in order to succeed. "They can't keep shifting their model in regards to funding and direct vs. indirect channels," the solution provider said.

That solution provider said that changes at HP are causing many of its solution providers to look at whether or not to expand relationships with other vendors, including IBM Corp., Armonk, N.Y., Network Appliance Inc., Sunnyvale, Calif., and even Dell Inc., Round Rock, Texas, which recently closed a deal to acquire storage vendor EqualLogic.

"Dell at least is saying the right things," the solution provider said.

The executive changes are coming at a time when HP is also reworking its storage line, a line many channel partners said is not a strong one.

HP just this month unveiled a new line of entry-level storage arrays in its MSA line to replace its previous MSA products. The new MSA2000, solution providers said, resulted from an OEM agreement with Dot Hill Systems Corp., Carlsbad, Calif. Dot Hill said last month it expanded its OEM agreement with HP, and that HP acquired a 3.5-percent stake in the company.

One solution provider, who asked to remain anonymous, said that HP seems to have hurried the release of the MSA2000 in response to sales issues with the MSA line, and that the MSA2000 does not use the universal disk carrier that HP has been offering to ensure that the same disk drives can be used in the MSA, EVA arrays, and ProLiant servers. However, a new MSA70 planned for later this year will have the universal disk carrier, the solution provider said.

Patrick Eitenbichler, director of marketing for HP's StorageWorks Division, denied that HP's storage business is hurting.

HP on Tuesday said as part of its first quarter earnings report that its storage business grew 10 percent compared to the same quarter last year, compared to only 1 percent during the second quarter of 2007, 3 percent during the third quarter, and 7 percent during the fourth quarter, Eitenbichler said.

Eitenbichler acknowledged that HP has had issues with its solution providers in terms of products and programs, but that most of those issues have been addressed.

On the product side, Eitenbichler said that HP just announced a refresh of its MSA line, and will have more news on the product front next week when the company holds its annual partner summit.

Programwise, HP has addressed concerns among its enterprise partners by cutting its Attach-Plus program, which rewarded solution providers for increasing the attach rate of storage sales to server sales, and replaced it with a straight growth-related rebate program that is easier to calculate and offers better margins. However, he said that the Attach-Plus program is still used for volume disk and tape storage through distributors, as those distributors are better able to manage the program.

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