HP has issued a statement confirming it is merging its PC and printer arms as part of a wider organisational realignment designed to boost performance and profits.
Analysts have moved quickly to voice concerns the move could "confuse partners".
Rumours leaked out yesterday that HP was to combine its Imaging and Printing Group (IPG) with its Personal Systems Group (PSG) under the leadership of PSG boss Todd Bradley. Together, the two arms - which will now be known as the Printing and Personal Systems Group - generate just over half of HP's annual sales.
HP has now confirmed this – along with speculation that IPG boss Vyomesh Joshi is to retire from the firm as a result of the shake-up – in a statement on its website.
A number of other organisational changes are being made, most notably HP's decision to combine its Global Accounts Sales organisation with its Enterprise Servers, Storage, Networking (ESSN) and Technology Services business under the newly named HP Enterprise Group. This will be led by ESSN boss David Donatelli.
Marketing functions will also be unified across the business units.
HP said that combining PSG and IPG would rationalise its go-to-market strategy, branding, supply chain and customer support worldwide.
"This combination will bring together two businesses where HP has established global leadership," said HP chief executive Meg Whitman (pictured). "By providing the best in customer-focused innovation and operational efficiency, we believe we will create a winning scenario for customers, partners and shareholders."
However, channel watchers have already voiced concerns that the move could hinder rather than help partners.
Jeremy Davies, founder of analyst house Context, said: "As a cost-cutting measure I can see the logic in combining two hardware businesses into one to save overhead costs.
"However, from a channel perspective, you are dealing with businesses that- leaving aside the obvious fact that the products are different - have diverging dynamics and to an extent, different markets. The imaging business is moving towards the MPS model, and PCs are a hardware commodity play. This is bound to confuse not only the messaging from HP, but also the relationships with its channel partners."
Martin Hellawell, managing director of HP Gold partner Softcat (pictured below), cautiously welcome the announcement, but questioned its timing given the pain caused by last year's review of PSG was still raw for many partners.
"At the moment, I have to have conversations with PSG and IPG, ESSN and HP Software," he said. "There are lots of different people to deal with and customers feel that as well. There may be a period of adjustment but over time I feel this is good news for us and our customers."
Hellawell also saw no contradiction between PSG and IPG's sales models.
"People have been talking about managed print for 25 years and it is still a very small part of the market," he said. "I don't see PSG being any less of a managed services play so I think they fit together quite nicely. If you could put the two together into one managed solution, that would be quite attractive to customers."
Alex Tatham, commercial director at HP distributor Westcoast, welcomed the move in principle but urged HP to do it quickly so it can focus on sales.
"I totally understand the reasons behind it but am a little concerned that HP will be inward looking for another six months," he said. "It doesn't put them on the front foot so the sooner they get on with it, the better."
Terry Betts, managing director of HP Gold partner CCS Media, said: "Overall, it is a good thing. It will make HP more efficient and therefore more competitive, which can only be good for partners."
Whitman also paid tribute to 31-year HP veteran Joshi, stressing that IPG had grown revenue from $19bn (£12bn) to $26bn and doubled operating profit to $4bn under his watch.
"VJ embodies the spirit of HP and his impact on the company has been tremendous," she said.
"Under his leadership, IPG accelerated innovation and pioneered solutions that transformed the printing market. We wish him the very best as he embarks on a new chapter in his life."
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