How to Capitalize on HP/Compaq Merger

By Kim S._Nash Print this article Print

HP has to prove the worth of its purchase of Compaq. That means there's no better time for customers to drive a hard bargain.

Hewpaq? Compackard? The $18.6 billion merger of Hewlett-Packard and Compaq is on, and so is the full-court press from rivals to steal customers amid the turmoil. Will it pay to take advantage? Maybe.

IBM already has paid a visit to Tom Murphy, chief information officer at Royal Caribbean Cruises, which runs systems from both HP and Compaq. "Throughout [IBM's] rhetoric," Murphy says, "they make it clear that, 'Hey, we have a product plan, and are stable, and know what we're doing, while some of our competitors do not.' "

Regardless of whether an approach comes from IBM or not, that's exactly the card HP and Compaq customers should play with their sales representatives, says Paul McGuckin, vice president and research director for servers and storage products at Gartner Inc.

Aggressive customers will recognize the merged company is, and will be, in heavy competition with IBM and Sun Microsystems—both of which, McGuckin says, have shown themselves to be hungrier for server business than Carly Fiorina's outfit. That perception can be turned into good terms on new server and services contracts—with either the new HP or one of its rivals.

Indeed, even with the combination of Compaq's Tru64 Unix products and HP's Unix systems, Gartner expects IBM to overtake the combined company and become the No. 2 player, behind Sun, in the Unix server market by the end of next year.

Still, Murphy at Royal Caribbean won't even try to leverage the tumult. He fears the new HP will simply make handshake deals to retain his business, then renege once it straightens out its act. "I don't want to waste my people's time," he says.

This article was originally published on 2002-05-14
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