Briefs; November 21, 2005

CISCO TO BUY CABLE BOX MAKER SCIENTIFIC-ATLANTA FOR $6.9B

Cisco said it is paying $43 a share for Scientific Atlanta, one of the largest makers of set-top boxes for television programs and movies-on-demand. The price is a 3.7 percent premium over Scientific Atlanta&'s closing price last Thursday of $41.45.

“Video is emerging as the key strategic application in the service provider triple play bundle of consumer entertainment, communication and online services,” said John Chambers, Cisco&'s president and CEO, in a statement. “The addition of Scientific-Atlanta further extends Cisco&'s commitment to and leadership in the service provider market.”

Scientific-Atlanta will become a division of its routing and service provider technology group, led by Cisco Senior Vice President Mike Volpi.

FORMER HP EXEC GILROY JOINS COMPUTERREPAIR.COM
Former Hewlett-Packard channel and global SMB executive Kevin Gilroy has joined ComputerRepair.com as a strategic consultant charged with building out the company&'s sales and service organization and sharpening its channel focus, ComputerRepair.com said last Thursday.

ComputerRepair.com provides onsite services via a national network of nearly 12,000 service provider partners. ComputerRepair.com President and CEO Jeffrey Leventhal said in a statement that the company is experiencing rapid growth and wanted an industry and channel veteran to continue to build its services network, particularly in the SMB market.

Gilroy left HP Sept. 30 after 24 years with the company during a reorganization and downsizing of the company initiated by HP president and CEO Mark Hurd. Gilroy&'s last position at HP was senior vice president and general manager of worldwide SMB business operations. Prior to that he was president and general manager of HP&'s Solution Partners Organization, a position now held by John Thompson.

Gilroy is a former CMP Channel Group Executive of the Year and was instrumental in designing HP&'s current PartnerOne channel program.

MICROSOFT&'S NEW PRODUCT PLANS ANNOUNCED AT IT FORUM
Microsoft unveiled a bevy of new products at IT Forum in Barcelona, Spain, last week, including Microsoft Dynamics GP 9, formerly Microsoft Business Solution-Great Plains, and plans for a midmarket version of its System Center management product, dubbed System Center Essentials.

The software giant also said it had reached significant milestones with several other products, including the release to manufacturing of Virtual Server R2 2005, which will ship in December at a heavily discounted price; the beta 2 release of Windows Compute Cluster Server and the planned release of System Center Capacity Planner 2006 to manufacturing next month. Virtual Server R2 Standard Edition will be priced at $99 and the Enterprise Edition will be priced at $199.

To transition customers to 64-bit computing, Microsoft also announced that several planned products, including Exchange Server 12, Windows Server Longhorn R2, Windows Server Longhorn Small Business Server and Microsoft&'s server for midsize businesses, code-named Centro, will be optimized for and run exclusively on x64-bit hardware, though 32-bit application support will be provided.

CHANNEL ACCOUNTS FOR HALF OF NETAPP&'S 2Q REVENUE
Network Appliance had a strong showing for its second fiscal quarter, in part due to its increased sales through the channel, according to the company.

Dan Warmenhoven, CEO of the storage vendor, told CRN that 50 percent of NetApp&'s North American revenue, and 60 percent of its worldwide revenue, was attributed to the channel in the second quarter, ended Oct. 28. About 13 percent of the overall revenue came via distributors Arrow and Avnet, he said.

Last Wednesday, NetApp reported revenue of $483.1 million, up 29 percent compared to $375.2 million reported for the same period last year. Net income for the quarter reached $70.7 million, or 18 cents per share, compared to $55.3 million, or 15 cents per share last year.

NetApp is bringing its solution providers the opportunity to become service providers on the company&'s behalf, Warmenhoven said. The company has finished a pilot program that offered a limited number of partners training and self-certification opportunities around NetApp services. NetApp is ready to roll the program out to partners worldwide, he said.

HP PROFITS PLUNGE AFTER $1.1B RESTRUCTURING CHARGE
Hewlett-Packard&'s fourth-quarter profit fell 62 percent after taking a $1.1 billion charge for restructuring-related costs and other expenses.

For the period ended Oct. 31, HP earned $416 million, or 14 cents per share, compared with a profit of $1.1 billion, or 37 cents per share, in the same period last year.

Sales increased 7 percent, to $22.9 billion from $21.4 billion. Excluding special items, the company earned $1.5 billion, or 51 cents per share, compared with $1.2 billion, or 41 cents per share, in the same period last year.

HP President and CEO Mark Hurd said in a conference call that the company had solid revenue growth during the quarter. He added that HP layoffs had reached 15,300, 800 more than the company predicted last July.