A victim of its own success? 'I have been convinced that Compaq would buy Digital for the past year - it was always obvious,' was the comment one trade figure made when asked for a reaction to last week's big news.
'The interesting question,' he continued, 'is what Compaq and Digital are going to do with the brand name because that has real value.' He hit on a fundamental point. Compaq has to keep the Digital brand name and build on it, otherwise the acquisition will be a waste of money. But can Compaq make the Digital name work?
I think it's questionable because Compaq's own identity is so strong.
This takeover could either be the beginning of the end of IBM's reign at the top of the global computer business, or the mistake that IBM has been waiting for Compaq to make.
For some years, I have wondered how Compaq was going to make the transition it needs if it is to have a long-term future as a single entity, i.e. from PC company to systems integrator. It has tried by buying up networking vendors and trying to find its way out from the desktop across the departmental floor to the server and onto the backbone. From there it may have been hoping that NT would take it into the data centre, and may still believe that will happen. But mainframes and Unix systems are still selling well where scalability is required and that has left the problem of the services business.
Compaq has never had a servicing business - that has always been done by the channel. But, much as Compaq loves the channel, for enterprise-wide systems and global systems, there needs to be an integrated services and support structure. IBM has one, so does HP. Digital probably has the best of the lot and has, in recent years, been moving back into its systems integration roots.
So, Digital gives Compaq what it needs - access to the enterprise market, credibility in that space and a fantastic services business, as well as a great deal of expertise in NT. The danger for Compaq lies in the difficult area of the Digital legacy - and its own. Compaq has always been struggling with the problem of making the transition from friendly PC cloner to serious enterprise-wide systems supplier.
Compaq has lacked real credibility in the enterprise market as anything but a PC or server supplier. The acquisitions it has made up to now have not been serious enough to give it any additional weight. But Digital is a serious buy and it could make Compaq the world's number one computer company. But only if Compaq can manage to hold on to the Digital brand and bring the Digital customer base with the supplier.
The danger now is that Compaq's success in the past 10 years and the strength of its own identity as a PC company will overshadow the identity of Digital, the systems company. If the Digital takeover does not work, Compaq will have been a victim of its own success.
Simon Meredith is a freelance IT journalist
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