HP aims for online vantage point

Internet Vendor shifts focus to the Net, announcing e-speak middleware as an important factor to its strategy.

Hewlett Packard is attempting to reposition itself as an interneteware as an important factor to its strategy. company by banging the drum for e-services and introducing its e-speak middleware as the potential enabling technology.

The hardware supplier intends to exploit its $3 billion finance arm to fund companies wanting to move into this space and is setting up four virtual e-services expert centres in the US, Europe, Asia and Japan, to provide customers with consultancy and support.

The centres in the US and Europe will initially be staffed by between 60 and 80 consultants - the others will employ 20 - and focus on providing expertise in technology such as e-speak to named accounts, including the Fortune 500.

Nick Earle, senior vice president and chief marketing officer at HP's enterprise computing unit, said: 'HP is positioning itself as an internet company. We have been accused of having no internet strategy, but now we're faced with the task of developing it as a key growth engine. IBM has done it and it will take time, but e-speak is the technology that will enable this vision.'

E-services are described as any asset - including information, applications, computing resources, services or processes - that can be put on the internet and accessed by users. HP hopes Fremont, which it has been developing for five years, will function as the universal language for services on the internet.

The e-speak technology comprises middleware that discovers compliant devices, internet-based applications and Websites, brokers their services to deal with each user's requests and then mediates between them.

Earle said: 'e-speak won't be the only standard - there'll be others out there and e-services will happen with or without HP or e-speak. But we'll be shouting the loudest and with our enabling technology we can be a leader.'

He added: 'We're following a similar strategy to the one we followed with Unix in the 1980s. We're looking for the next 100lb gorilla; it may still be a baby, but we intend to feed it.'

The manufacturer is making the technology available under an open source licensing agreement.

Meanwhile, HP's stronger than expected second-quarter results are nothing more than the culmination of a cost-cutting exercise, claimed Ed Thompson, analyst at Gartner Group. He insisted the results were generally positive, but added: 'It is merely a sign that the company has done a good job in keeping costs under control. It also means orders are up for the next quarter - not necessarily for PCs, but for the V Class servers and N Class servers.'

For the second quarter, ended 30 April, net income was up 34 per cent to $918 million, compared with $685 million in the second quarter last year. Revenue for the quarter was $12.4 billion, a three per cent increase on the same period in 1998. But the manufacturer said Unix system server revenue declined compared with the same quarter last year.

Last month, HP announced its N class server range, which brings in up to 70 per cent of its Unix hardware revenue. Revenue from this range should come through in June.

Thompson said the results were more an indication of the strength of the printer cartridge business than a barometer of industry health.

'Printer cartridges make up the main part of HP's profit. Its printer business contributes about $3 billion,' he said. 'What is interesting is that the technology stock watchers are saying the PC business is doing better than expected. Traditionally, it does better in the second half of the year. We're expecting a slowdown, particularly in the corporate market, so this may mean the second half of the year is much worse.'

Earlier this year, HP announced that it planned to spin off its test and measurement business and that chief executive and chairman Lew Platt, would retire next year.