Slashdot Mirror
HP Buys Compaq
MaxVlast was the first to report: "The New York Times is reporting that HP is buying Compaq to form the second-largest computer company (after IBM). Wow."
← Back to Stories (view on slashdot.org)
← Back to Stories (view on slashdot.org)
Is this for real?
Me and a friend of mine were just talking about the differences between the two companies... Trippy...
-AndrewJNR, NSO, The Don College
If you don't want to register just go to http://archive.nytimes.com/2001/09/01/technology/0 1WEB.html ..you know the drill ppl.
Either this will make a huge company that will struggle just like both companies are doing now or suddenly they'll dominate.
I'm betting they'll lose billions their first year.
I wonder what they'll call it.
Yeah, yeah, karma whore, whatever ...
D EAL.html
http://archive.nytimes.com/2001/09/04/business/04
Could someone with an account please post the article. I'm a bit shocked. I figured with Carly at the helm, HP wouldn't do anything worth shit. I just can't imagine them having enough money for this....
Great - now there's only one brand of cheap, crappy computers on the market.
This space intentionally left blank.
Let's hope so, that would be another huge computer company that is supporting linux!!
For Hewlett Compaqard?
Donate background CPU time to fight cancer.
What happens if HP and Microsoft fight ... HP are already on record as saying they would go elsewhere if they could ...
OS/2 - because choice is a terrible thing to waste.
Subject says it all...
"But actually trying to use m4 as a general-purpose langage would be deeply perverse" --ESR
Thought the first: Is bigger always better?
Thought the second: HP and Compaq are both really awesome companies (if you exclude their home computer divisions). This is cool.
I was discussing this with my parents a few days ago:
Gateway is apparently in the hole because they don't offer much "unique" and with computer sales allegedly having a bad forecast, this doesn't leave much room for competition: Dell, IBM, and now "HP/Compaq" are here to stay.
Can we expect to see more mergers, or what's the deal? With computer "builders," we don't really suffer from the lack of standards, interoperability, etc. that we see in harware/software...so are these mergers really helping consumers or just gaging the diersity of merchants?
... or I'm mistakenly reading Segfault.
Hewlett Paqard?
...c'mon, _someone_ was gonna say it...
If I remember correctly, Compaq had eaten up a lot itself. Didn't it do Tandem (high end corporate mainframe like machines) and whoever did the Alpha (Digital, right)? I don't see how those have really grown, but maybe they've got some eye on some of Tandem's technologies for their midrange line. But you'd have to think that Compaq has a bit of indigestion from it.
Now, here comes HP, buying up Compaq? Well, at least Alpha/Tandem seems like a better fit for HP than it ever did for Compaq.
Anyhow, it seems like HP is picking up a LOT of baggage that they're going to end up throwing away. Sounds like an awfully risky business venture.
With this one, I'd have to say that Fiorina has some balls
- Hewlett-Packard to Cut 6,000 Jobs (July 27, 2001)
- Compaq's Revenue and Income Fall (July 26, 2001)
- Hewlett Profit Falls but Beats Expectations (August 17, 2001)
- Compaq to Emphasize Computer Services (July 17, 2001)
- Market Place: Compaq Announces More Layoffs (July 11, 2001)
Big time mergers are usually between successful companies or at least where one of the companies is having a particular successful run, this looks like a merger of companies are both fucked. Also considering the amount of overlap in their products, expect more layoffs.Sad, indeed.
How will they combine PC color schemes? Rose! Pink! Disaster!
spacefem.com
Can't you guys look into sources that don't require registration??
Screw you all! I'm off to the pub
I wonder what HP will do with the iPaq, as they have the rival Jornada.
Integration between the two seems unlikely, so either elimination or discontinuation are plausible. That is bad news for iPaq, but good news for the rest in the PDA market (Handspring, Palm), as it is one less competitor to watch after.
You know, I've never thought much of HP's support. I've called about an issue,and they ask, "What sort of RAM." If it's not HP branded RAM, they won't talk to you. There servers look cheap, and are put together poorly. They do goofy things to standard (reference DLT1), and, well, are cheesy.
Compaq's support is better, and they seem to have their act more together when it comes to high end technologies (clustering, Data Center Server, etc.). Still, it leaves something to be desired relative to other vendors.
Hopefully, this merger will mean that Compaq's server line takes over HP's NetServer, and not the other way around!
Let's see, the Alpha has killed DEC, is almost finished with killing Compaq. Anyone want to bet how long it'll be before the Alpha kills Hewlett-Packard?
Hewpaq Compardlett
obviously
Screw you all! I'm off to the pub
While Compaq hasn't done much with Alpha since it bought out Digital, there was always that hope that something new would eventually come out. Alpha was a lovely chipset for all of its thermal and pricing issues (which could've been solved by a company with more drive and fewer pitfalls than Digital/Compaq had.)
But now that HP is buying Compaq, any life that could've possibly been breathed back into Alpha is completely dissipated. HP is firmly in bed with Intel on the Itanium line (fronting cash, codevelopment, independent liscensing, etc.) Whereas Compaq hadn't had much incentive to improve Alpha, HP has exactly zero interest, since that would mean directly competing with and undermining the success of Itanium.
The polite course of action would be to release Alpha completely into the public domain, but that's a farcically utopian request. I'm just always saddened when competition is reduced and choices are constrained. Let's just hope Apple and the PPC line don't go bust in the near future, leaving us with absolutely no alternative to Intel's offerings (which are beginning to look more and more like crap as the years pass) and AMD's parallel offerings in the same architecture.
What will happen to the iPaq pdas? I've seen the HP PocketPCs and they can't hold a candle to the iPaqs. Hopefully if one line has to go, it will be the HPs.
-linux... they can't *give* that shit away.
I think this could actually help turn the economy. The home pc market has become too bloated, and the way most people pick their new pc is just by the brand name they're familiar with. I hope this goes through, the market is way too crammed with too many pc makers
Pending regulatory approval, the new company will hold a 19% share of the global PC market. Dell comes in second at 13%. Also interesting HP-Compaq will hold a 37% share of the market for high-end servers. With such a 500 pound gorilla on the field, it would definitely be nice for them to emphasize Linux support.
The big loser in the deal - Lexmark. Compaq had been one of their largest customers for bundled printers.
- Carpe diem, quam minimum credula postero.
Compaq's been working a while with Intel on transitioning from the excellent Alpha processor line to Intel's unproven Itanic, er, Itanium line for their high-end systems. They even transferred a lot of Alpha engineers to Intel, who are now Intel employees, so they could work on Itanium instead. Personally, I thought all that was really stupid: Alpha is a great architecture, and has a lot of life left if they'd do improvements like moving it to a 0.13 micron process.
HP has its own 64-bit RISC processor architecture, PA-RISC, which they use in their workstations. But they've been talking about phasing this out as well (are they going to Itanium too?).
So what's HP-Compaq's new strategy going to be? Give up on competing in the 64-bit processor space, fire all their engineers, and just buy Itaniums, and become glorified computer integrators? Or will they pool what's left of their resources and concentrate on making one great 64-bit processor to compete against the UltraSPARC and Itanium?
When announced job reductions, of 8,500 jobs at Compaq and 9,000 at Hewlett-Packard, are completed, employment at the companies will be about 62,800 at Compaq and 87,000 at Hewlett-Packard. Further reductions seem likely, as executives said that they expect annual cost savings of $2.5 billion within several years.
In its most recent 12 months, Hewlett-Packard reported revenues of $47 billion, while Compaq had revenues of $40 billion. The combined $87 billion is close to the $90 billion reported by I.B.M., and far above the $33 billion for Dell Computer, which now ranks fourth and would move to third if the merger is completed.
In its most recent financial report, for the nine months through July, Hewlett-Packard said its revenues were down 5 percent from the comparable period a year earlier, to $33.7 billion. But its net income fell 82 percent to $506 million. Compaq, reporting on the six months through June, said revenues fell 13 percent to $14.2 billion. It suffered a net loss of $201 million for the period, compared with a profit of $684 million in the same period of 2000.
I will not ever sit back and haplessly allow my company to abandon the things that make it unique, the individuals that have brought it to where it is, in order to pursue stupid figures such as yearly profit.
Just because there is an 'economic down turn' does not mean that, for the next FIVE YEARS (not three months or one year or next week, as the rapidly changing investors' markets focus on)HP won't be pioneering in quality, reliable computer technology. As someone who actually gives a shit about the future of companies that produce products that I like, I refuse to believe that the stock market's logic can positively affect these companies.
Short term profit goals must be met in a modern investment climate. HP and Compaq merged to save money, but they will wind up cutting the very things that make them unique and separate products in order to save money.
Compaq and HP merging is like Kia and Saab merging. HP computers kick so much ass, and last for such a long time
I have an ancient HP Vectra VL2 downstairs that still carries its own weight in my household. What parts of shitty Compaq will they be using in HPs now?
Parts of hardware? Parts of support?
I don't really care one whit about the existence of Compaq or not, and I can't see any benefit from HP having a larger cashflow, except for to the stupid stock market, which has nothing to do with the basic economic dynamic of a company producing a product to please its customers.
Goat sex free since 2001
And this is after HP laid of 6,000 people in July.
Check the above link to read about this merger...
¦ ©® ±
This means HP will inherit the Alpha processor. They already have the PA/RISC and are "co-developing" some of the IA-64 line with Intel. They also inherit cool products like the Itsy and the iPaq.
Linux is the only OS that will run on their entire architecture: Alpha, PA/RISC, IA-64 and x86. They sell machines with all of the above processors.
The makes a "Big 3" of Unix vendors: IBM, Sun, HP/Compaq.
SCO was acquired by Caldera, but they, along with all the other Linux vendors, are wannabes next to that bunch.
Unless I am missing someone, that really only leaves SGI as the remaining "big" Unix vendor. I wonder if they are going to be bought; wither-and-die; or if they can make a go of it alone.
Learning HOW to think is more important than learning WHAT to think.
Get ready for more HP articles at www.fuckedcompany.com. This is going to push HP over the cliff.
On a related note, and this is dead serious, there is a Slashdot article on fuckedcompany right now. They say the following is FALSE:
Apparently Slashdot website creator, Rob "CmdrTaco" Malda, was rushed to the hospital this afternoon after having his penis cut off."
Very odd. No. I didn't make this up. Follow the link.
Hewlett Compacqard Bell.
-------------------------
"After Careful Consideration, Bush Recommends Oil Drilling" - The Onion
ha, thats good, how about "Hewlett packcrap? It doesnt matter, its all crap ;)
________________________________________________
The most immediate impact I predict is in PC sales. I've always had the impression that Compaq did much better in this market than HP, and ignoring the fact that all Compaq PCs now are HP PCs ;-), there's now one less choice for Joe Average Consumer. I haven't been to a non-online computer reseller in years, but IIRC places like CompUSA had very few brands -- Compaq, HP, Toshiba, and maybe some Macs. Dell and IBM only sell direct, right?
I only hope that HP is nicer to Compaq than Compaq was to DEC. :-0
--
I like to watch.
I'm amazed... wow!
However, I think it's bad that HP is buying Compaq, instead of the other way around... I've never been impressed with HP's products (other than printers, which are the best), particularly their servers or workstations.
I've always preferred Compaq's to theirs. It will be sad to see the end of the Deskpro workstations and ProLiant servers, which were always a pleasure to install, set up, and even repair. I've had to replace several customer's paper-thin motherboards in HP NetServers... Compaq servers are built to Millspec, like most of the IBM servers. HP's are more plastic and flash, much like Dell servers.
Ms. Fiorna has pretty much led HP down to ruin since jumping off Lucent just before THEY went to ruin, so entrusting her to lead this new beast may be a shaky proposition. I don't really see how swallowing Compaq will really gain HP anything new, as the only really interesting technology Compaq had (Alpha) they've pretty much given away. I see this as HP gaining a lot of overhead, a lot of revenue, but little in the way of additional profit, as Compaq has the very same market problems HP did.
Looks to me like the only REAL gain HP makes is getting a MAJOR competitor out odf the way...
=== The price of freedom is eternal vigilance
Compaq snapped up Digital a couple years back. Digital had a ton of industry intellectual property... probably more than anyone other than IBM. Networking, CPU design & fabrication, Relational DB, clustering, DASD, Messaging, etc etc.
...
Compaq couldn't really do much with it, and sold much of it off to Oracle, Intel, Cisco, etc
But not everything was sold to the high bidder. Some of it stayed within the corners of Compaq, waiting for a brighter day.
HP's culture certainly could benefit from much of that technology, and it's far more likely that HP can leverage some of technology to propell itself into IBM's datacenter space.
But the HP deal could weaken Linux a little bit, because HP isn't as much of a Linux advocate as IBM, and is an Intel/Microsoft partner & advocate (unlike Sun).
So, in the end, this deal could help Microsoft and hurt Linux.
Note that if you replace "www.nytimes.com" with "archives.nytimes.com" in any NY Times link you always get the article without having to register.
(Posting as AC so not as to be accused of being a karma whore . . .)
IBM completes a hostile takeover attempt on the newly created Hewlett Compaq, this just 72 hours after buying Gateway outright, in a leveraged stock and options deal. Industry analysts expect that the eventual hyper-merger, to create a single corporate entity (Unicorp), will take less than 24 months at this pace. With the financial industry consolidated last week into "Unibank, the World's Favorite Bank", this editor believes that 24 months is a serious overestimate.
I use a HP Workstation at work that uses their 64-bit PA-RISC processors. This workstation also uses a USB keyboard and mouse. While it does seem pretty smart to move right to USB for a Unix workstation, the mouse and keyboard they provide are total crap. The keyboard is a $5 special like most companies provide with their cheapest budget computers at Wal-Mart. This is on a $40,000 workstation.
But what's really funny is how they implemented the USB interface. I had my keyboard replaced, and of course they'd only give me another one exactly like it. When the technician came to swap keyboards, he powered down the machine before removing the keyboard. I asked him why he was doing this (this workstation takes forever to boot), since USB is supposed to be hot-swap. He told me that they'd tried that before, and had destroyed several motherboards! So now that IT department has a policy of powering down workstation before changing any peripherals, even if they are supposed to be hot-swap. Apparently HP forgot to implement the hot-swapping part...
I'm not a businessman, surely someone around here can enlighten me.
Compaq destroyed Digital. HP will destroy Compaq. This is not good for anyone.
That or just go as HP, that might be the wiser choice, who knows.
"And we have seen and do testify that the Father sent the Son to be the Savior of the World"
1 John 4:14
I hope they won't rename OSF / Digital Unix / Tru64 again!
It's 11pm, do you know what your deamons are up to?
Very few mergers succeed, even when there does appear to be some legitimate synergy or corporate fit. On paper it made a lot of sense to combine Chrylser and Daimler. In practice, the two cultures were so different that they seem bent on destroying each other rather than making the combined company better.
Now Carly is going to take two companies, each weakened by current economic conditions, and combine them. Where exactly is the synergy? Two manufacturing organizations, neither the lowest cost nor highest quality in their market, and both in thrall to Intel? That's a good combination.
And so on down the line. Synergy is vastly overrated when it EXISTS, and I have a hard time seeing any hear. Doubling the size of the Titanic would only have caused it to sink twice as fast!
sPh
Let's see. These companies grew fro acquisition, and I leave the impact/advantages to your imagination:
AOL/NETSCAPE/Time/WarnerBrothers
Boeing/McDonnelDouglas
Compaq/Digital
Caldera/SCO
and the list goes on.
Mergers of this size inevitably lead to monopolies. An example is the aerospace defence industry. Where I comefrom (Australia) Boeing owns everything. So much for competitive tendering.
This is huge. I'm a big fan of Compaq servers, but HP's x86 servers have never impressed me. I hope they incorporate a lot of Compaq's management in to their line.
Well, I know Bruce is a regular here, and will probably have some feedback somewhere :), but I'm wondering if this will provide more corporate level exposure to Linux with the modus operandi of "challenge the executive", IIRC, in the Compaq ranks as well as the HP. The actual merging of two companies of this size is rare and hard to predict, but in the fray sometimes new ideas come up that are entertained that might not otherwise be. I am curious as to how this will affect Bruce Peren's (et al) influence on HP and Compaq, but I don't want to speculate on it.
Is this merge of companies going to be for the better, or for the worse? I honestly cannot figure this question out myself, what do you people think about it?
Admin - www.newspad.org
NewsPAD - the daily news source for geeks!
30 minutes after the news breaks, the CNN website still has sharks eating swimmers as it's top story. Hell, even Yahoo! news has it now! Looks like someone is asleep at the wheel on the CNN newsdesk tonight....
http://www.anagramgenius.com/server.html
Crap! Kept mad Coq wealth
(ok, I had to tweak it around the 'q')
Screw you all! I'm off to the pub
HP has a market cap of about $1.5B, CPQ has $24B. HP will have to issue 25x their current float to make the acquistition which leads one to wonder why CPQ isn't the acquirer. It strongly suggests that CPQ is a mess.
The net result should be a collapse of both stocks in the premarket. But then i've never been able to predict these things.
use the archive.nytimes.com to view the article without reading: link
[drumroll]
It's going to be "GNU/Hewlett Paquard"!
[/drumroll]
-- Josh Turiel
"2. Do not eat iPod Shuffle."
Personally I kinda see it the opposite, the technology from both of them will probably be merged , even if they don't change names. If it's a matter of big company loyalty, they could just put different stickers on each one :-)
"And we have seen and do testify that the Father sent the Son to be the Savior of the World"
1 John 4:14
Imagine what's gonna go on in the engineering labs at HPaq....
HP-UX vs. Tru64.
NetServer vs. ProLiant.
Jornada vs. iPaq.
Deskpro vs. Vectra.
PA-RISC vs. Alpha.
Whoa.
Maybe we'll get lucky and they'll wipe each other out.
Imagine the possibilities though:
HP-UX 12i... now with DECnet!
Or Tru64 Unix... now with SAM!
Or better yet, DECclusters of HP-UX running on PA-RISC.
Since Compaq doesn't even _OWN_ the Alpha anymore!
And where does OpenVMS stand? I know most everyone here are Unix folks, but ya gotta respect VMS... it _still_ works, and _still_ runs those true mission-critical servers!
--nbvb
Compaq management fucked up with the purchases of Tandem and Digital. Totally wasted billion dollar investments. Very sad.
HP made this investment for Digital and Tandem technology, and Compaq's sales and marketing. HP always had stronger datacenter service than Compaq-proper.
Compaq itself is only an interesting brand name and marketing channel. There's no way that HP keep the existing Compaq PC line going. The only advantage of HP buying Compaq is that HP now has one less competitor.
http://archives.nytimes.com/2001/09/04/business/04 DEAL.html
Yeah, I know, Taco won't change'em so NYT won't bust his chops, but they're gonna bust us all bigtime if we keep swiping their articles straight up... Just right-click, copy link location, paste into new window, make the appropriate edit, and fsck'em. After all, it's not like you were gonna feed'em real marketing data anyway.... right?
--
You need a Linux guru.
They use GNU tools over at HP, too. I'm sick and tired of people not giving credit where credit is due!
Look at this: Linux Evangelist
And there's a nice picture of Tux on HP's webpage.
F-bacher
James Tiberius Kirk: "Spock, the women on your planet are logical. No other planet in the galaxy can make that claim."
Kudos, Slashdot, you beat all of other tech news sites to the punch! No of those pesky holidays slow you guys down, do you? :)
Seriously, this merger should pose some serious competition for Dell and IBM. Once you combine the sales, a merged HP and Compaq makes the worlds largest computer hardware manufacturer. Dell and IBM, running neck and neck for 1st in overall hardware sales, now get bumped back to 2nd and 3rd.
Both HP and Compaq also had relatively small but quickly growing service consulting arms, but the combination of the two should give IBM and Accenture a rough time.
Unfortunately, neither company had a huge showing in software, so Microsoft shouldn't be TOO worried by this.
This deal makes no sense at all, longs are going to get screwed on this one. I'm short CPQ but I'm not even worried because this deal just sucks. CPQ will trade up 20% tomorrow for a few minutes and then the selling will begin and it will close DOWN 10%. Since it's an all stock deal, the aquisition price is tied to HWP shares and they are going to get hammered tomorrow so the end result is only a $15 billion buyout.
THANKS FOR THE MONEY LONGS. If I was long this POS Compaq or HWP I'd sell for any price I could get. What a POS deal. It's like McDonalds merging with Microsoft, the deal makes no sense at all.
Intel bought the Alpha division from Compaq a while ago, before HP bought the rest. So, no, Compaq will not be getting Alpha.
There comes a time in every man's life when he must say, "No mother! I do not want any more Jell-O!"
the acquisition amounts to a renewed bet on the computer business and particularly a new operating system for computer servers that was developed by Intel and Hewlett-Packard. Compaq is the other large company that has announced it plans to use that technology, which will compete with technologies developed by Sun Microsystems and I.B.M.
The don't seem to say what they're talking about, but the only technology I know of developed by HP and Intel (who doesn't do OS's, as far as I know) is Itanium. Compaq has dropped Alpha development in favor of Itanium, and Itanium's major competitors are Sun's SPARC, and IBM's PowerRISC chips.
I had also heard that SGI was dropping MIPS in favor of Itanium, but they might not be big enough to count, here.
The New York Times article talks about both HP and Compaq devoting resources to the same server OS. Which one is that?
evanchik.net
Direct link to the article is here.
(due to lameness filter I must insert something here. Stupid lameness filter)
Big Blue will break em.
HP buying Compaq.. isn't this akin to the blind leading the blank? I do computer work part time and I've long called both HP and Compaq boxen by the same name...
'Job Security'
Compaq eats DEC, HP eats Compaq...who's going to devour HP? (and for that matter, who did DEC devour before that?)
Things will look great for HP for a while...all of a sudden they've got thousands of new customers!
When you look at the numbers, the merged company is now tied with IBM in revenues. Dell is left far behind. I would look for Dell to have to make some acquisitions of its own to stay competitive (Gateway, anyone?).
With this merger HP/Compaq will pretty much own the retail computer market.
Look for mergers in the direct sales market to keep companies like Dell and Gateway viable.
evanchik.net
does this mean now that Hewlett Packard IS IT? i'm so confused. oh well, as long as i can still run my server in my van off an inverter like in the commercial.
sig
I don't know what your source was for the $1.5B market cap for HP, but according to Yahoo Finance, it HP has a market cap of $45B
In a shocking announcement Steve Jobs, and Bill Gates today announced that Microsoft will be purchasing Apple for undisclosed amount of 10.5 billion dollars. No word yet on the alledged dissapearance of Steve Ballmer.
Complett-Packpaq!
Not a big loss. It had no business being on fuckedcompany in the first place.
Aren't most of these machines and their parts assembled in East Asia anyway? So, what difference does it really make what US label is put on them? What value do Compaq and HP actually add to these products, other than a brand name?
Listen up youngster, HELMERICH PAYNE(NYSE: HP) does have a market cap of $1.5 billion. But HELMERICH PAYNE isn't buying out Compaq, HEWLET PACKARD(NYSE: HWP, market cap $45 billion) is. Get your facts straight before posting next time.
Please mod the parent "-1, FUCKING STUPID".
My bet is that it will result in the same sort of thing that happened to 3Com with the USR, CoreBuilder, and other companies they bought and then had to split off to preserve their core units.
My guess is that it will split things into two or three groups: High-end server and workstations, medium and/or low-end desktop/laptop PCs.
That, or they'll turn into a huge behemoth, which seems unlikely to happen, but always possible.
hate to burst your bubble but compaq sold the alpha line to intel. it was pointed out in several previous comments too.
Only the State obtains its revenue by coercion. - Murray Rothbard
- OpenVMS on PA-RISC (not too scary, but... ewww), now that the Alpha is gone?
- HP-UX on Alpha, just to help Intel rape the last bit of dignity out of the platform?
- A resurgance of NT/MIPS with the new "Kayak Himalaya" workstations (dumb, but this is Compaq and HP we're talking about here)?
- PA-RISC in a new line of "Nonstop Himalaya" server (again, dumb, but is MIPS over Alpha was stupid, too)?
and, the scariest, and most-probable....- An HP-made server, with that <sarcasm>wonderful</sarcasm> HP support, running HP-UX (blech) on IA64 (cringe), using Compaq's horribly nonstandard system components and chassis, with HP's horribly nonstandard (and flaky) RAID system.
I just hope HP sells of the stuff they make that doesn't suck (calculators, printers, and medical/testing equipment) before they make something really stupid and tank. Or, maybe we'll just luck-out and simply continue to make the same crappy PCs--all under one roof. I think I need some liquid recovery now.Pining for the days when The Glorious MEEPT!!! graced SlapDash with his wisdom.
So what about the iPaq? I can't afford it, but I've heard great things about it. Will it be killed off in the name of corporate politics? Hopefully HP is smart enough to recognize a good thing when they see one, but they never really consult the engineers, do they?
Kurdt
I'm not anti-social. Just pro-technology.
Boy, now there's a winning strategy. Two companies bleeding red ink out their corporate asses decide to merge with stock swaps (no hard assets, no strategy, no intelligence exchanged or used.)
This is a deal to stir up stock prices and bugger all else.
So what'll happen?
Tata Alpha...
Compaq's clients will get irritated by the loss of corporate focus.
HP's clients (who are HP's clients?) will do the same.
The stock market, still reeling from the trillion dollar loss of Y2K will get irritated at the sheer pointless attempt to maniputate stock prices in some direction other than the death spiral they have been in.
Great. Another lose-lose situation.
MSBPodcast.com The opinions expressed here are my own. If you don't like 'em... Think up your own stuff.
Amazing isn't it how one poor decision leads to an avalanche of further massive expenditures, good money following bad? HP decided it didn't want to spend the resources on the next generation of PA-RISC, so it decided to partner with Intel on Itanium. Unfortunately this was in time to concede huge markets to Sun, a company that has chosen to go against Wintel in both hardware and software. So HP missed out on the boom. And now it's trying to make up ground in the downturn. Look near the bottom of this article from Forbes. Since 1994! HP has been caught in a trap where it is perceived that its flagship processor will be phased out. Under those circumstances it is impossible to grow that part of the Unix business. So HP has been caught trying to sell "NT workstations", expanding into selling consumer PCs, anything to generate the slightest bit of revenue.
Meanwhile Sun and IBM went on developing their next generation 64 bit processors. After the downturn ends, and it will end, who are going to be in a better position, companies who sell their own chips or companies that are fighting to be Intel resellers? What exactly will be the barrier to one's competitors also becoming Intel resellers if that is right?
What no one seems to want to acknowledge is that if Dell continues to hold the lead in efficiency, there really is no reason for any other major player to be in the commodity Intel PC business. It doesn't matter if you're twice, three times, whatever Dell's size. If Dell is more efficient, if Dell can make money and expand even in a downturn, it's only a matter of time. And Dell can use its current strong position to keep moving up into higher revenue markets.
The combined HP/Compaq will not be able to cut a better deal from Intel than Dell can because Dell has always been an Intel-only shop, the most loyal one. Dell's competition in laptops is Sony not from anything HP/Compaq does. The only area HP/Compaq has an edge is in PDAs.
Let's think--who will survive selling PCs in five years and why. Dell wins because they are the most efficient. Sony wins because they can bundle multimedia goodies and sell at a premium, plus if PCs are getting to be more like commodities, Sony has the edge in consumer electronic design. Apple stays alive by staying off Intel and also exploiting its reputation in education and multimedia. (Although in education it is once again Dell that is the main competitor, not HP or Compaq.)
What's especially absurd is that neither HP nor Compaq can exploit what makes Dell so efficient because they can't solve the problem of how to sell directly without alienating the middlemen distributors. This problem is impossible to solve with the companies' present business model.
The prospect of trying to combine a corporation whose roots are in the Bay Area of California with one whose roots are in Texas--how come no one questions these catastrophic mis-marriages of disparate corporate culture? Houston, Texas and Palo Alto, California?! What a joke.
... well in my company as well, they are all Compaq and they refused to even look at the HP line of Servers when they had the chance... Guess I have to ask them tomorrow how they feel about the HP thing now (guess they won't even know when I ask them tomorrow).
If you want to e-mail me, use my PGP Key.
a new operating system for computer servers that was developed by Intel and Hewlett-Packard
Which one?
HP has always made good stuff. I can't say the same thing about Compaq although the iPaq is pretty good. This could be good for HP. At least maybe they can work towards a good iPaq replacement! The Jornada's screen sucks! Looks like the new HP handheld will be a good one! Wonder what Bruce Perens thinks of this move!
Gorkman
Watch for their new handheld computer, the HPaq...seems like a step backwards, but it ain't! :)
My journal has hot
I work for Compaq... boy, I bet it's gonna be weird at work tomorrow...
look down and see if it was April Fools? This headline would fit in with all the other stuff that /. spews out on that day....
I agree. It seems like HP is going to become the Computer Associates on the hardware side, and just buy up all of these failing companies with proprietary projects, and milk them to the death. Merging two companies of this tremendous size seems a recipe for disaster.
Is this going to replace the current tagline, HP - Invent?
They have a piece tonight about 'CEOs on the edge', where they profile HP, saying how it's not as nimble as Dell, and dosen't have the the patents of IBM. No mention whatsoever of this buyout.
Consider the size of these companies. Buying a competitor is just the first step. Truly merging on an operations level will probably take serveral years. Durring that time, I wouldn't be suprised if the new (merged) company reposts losses over at lease several quarters, although in the long run, I'd say this merger is probably a good thing for investors in both companies.
--CTH
--Got Lists? | Top 95 Star Wars Line
I have always preferred Comapaq x86 servers to the HP equivalent mostly for their ease of server support. However, Insight Manager is really a poor program and does not come close to HP Openview for server operations management.
My dream is to have HP keep the SmartStart team, embrace and simplfy management of Linux servers, and bundle HP Openview Express with each purchased server.
Will it happen, probably not anytime soon. But, before the Itanium servers start making their way to small to midsize business I believe this could be a combination to give IBM and Dell a really big scare.
Hell, while I am dreaming, bundle a central management database like NDS for Linux (Hey HP, buy Novell too :) and then lets see how bad the Redmond crew will sweat.
Brian
I will be the first to say that Compaq stuff sux, except the proliant servers which are okay for midranged computing. First of all..... they don't have any technical expertise to handle what they are selling. You have to go through 3 levels of support before you get to someone that has any idea of what they are doing. Compaq is purely run on politics and marketing just like M$. The name COMPAQ sounds good, but you are actually buying all crap besides a couple of descent products. This merger may be okay for them given HP will focus on the consumer line and the compaq end of it will probably focus on service and solutions. I'm sure all of there manufacturing facilities will move overseas east or to Southamerica.
It's all going to boil down as to who has the best product, service, and overall technical knowledge. Compaq and HP lack in all areas. IBM will own because they have solid products, service, and solutions... including an excellent technical staff (kind of like Cisco).
I hope Compaq get's cleaned out...they have been slupring on wine and eating cheesecake off there COMPAQ branded junk for way to long......
later
But who's going to sue 'em for being stupid? Okay. Besides the shareholders?
While I am sure many of you have only thought about the "technological" ramifications this brings, let me shead some light on what it means to work at one of these companies. After last weeks layoffs, this is really bad news to HP. While I think Compaq does an execellent job with their engineering, their view on treating workers as "resources" may affect "The HP Way." HP "was" known for their treatment of employees, their ability to hedge back times, and for promoting team work instead of individualism. With Compaq being brought in, I think HP's directors and managers could become tainted by Compaq's tendency to layoff workers when profits look bad. HP and compaq have very different mindsets, and this merge(/buyout) only means that this new company will be a compromise of the two. HP used to do everything within its power to keep a "work force reduction" from happening. I was throughly conviced that last weeks layoffs were an adjustment due to changing times, but now bringing compaq in cements the fact that layoffs (or work force reductions as their PR department likes to put it) will become a cyclical thing. Also these different mindset will cause bad decisions to only explode. If they plan on succedding, they will need to adopt a single culture (and not a hybrid of the two.) Otherwise only bickering and redtape will result. Another reason this is a bad idea is the effect it will have on its effect of swiftness. There is burecarcy (sp) all over both. The new company will even be slower. This is not the time to slow down a tech company. I can see how easly its going to be in the future when it comes to implementing new solutions/products And yes there is overhead. Major overhead. Carlies biggest reason for buying compaq would be to add to HP's services group. (Which happened to be the reason why Compaq bought Digital. Honestly, it wasn't for their UNIX business or alpha processors.) There will be several labs in both HP and compaq that will start to sweat over how will stay and how will be re-orged. The next few monthes are not going to be a good time for HP and/or Compaq. I'm hoping things work out. Otherwise Carly could be HP's Rick Bullizo.
April fools?
HP used to have great (but complicated) products and engineers in the sales force who could guide the customers through all the complications of being a customer of such a geeky operation. They jettisoned the sales engineers to save money, but they didn't simplify the products enough to make it work. So, now they buy some company that deals in simpler stuff. If you can't do it, buy it. Same old story.
Packard made some the greatest cars ever made in America, back when Hewlett was still in 3-cornered pants. Wish they still did, this high-tech is a comedownance for them.
Seriously, Compaq owns the work the Digital did on Modula-3, so now HP will own Modula-3, and they will have a great secret weapon of software. HP printers have java running them, which is why they work so crazy half the time anymore. Maybe HP can fix this now.
HP puts abrasives into their printer toner so that you wear out your printer faster and have to buy more replacement parts. They sell printers as a loss leader and make a fortune on printer cartridges and supplies. I wonder how they can adapt this strategy to Compaq -- maybe sandpaper in the harddrive read heads.
If Packard hadn't let Hewlett get top billing, their unix would have a more appropriate name.
I wonder how long it will take yahoo to change the "Powered by Compaq" image on their home page or will they just ditch it.
Compaq already comprises 2/3 of our LARGE scale support. non-stop Tandem Kernal, PC level, VMS, and now they get into bed with HP.
errr....umm...*whooosh* *whoosh* Is this thing on ?
This seems like a really bad deal/trade off if you ask me. I don't know why any two companies of this size would want to merge together, I just lost what little respect I still had for these two companies now hehe.
Admin - www.newspad.org
NewsPAD - the daily news source for geeks!
From the third paragraph of the NY times article:
"the acquisition amounts to a renewed bet on the computer business and particularly a new operating system for computer servers that was developed by Intel and Hewlett-Packard."
Are they really talking about the Itanium CPU or did I miss a big announcment?
Chris
HP and Compaq merge, and all you are worried about is the color schemes? Either you've a VP, an interior decorator, a datacenter manager, or a gay male with the decorating gene.
BTW, nice insight.
Now Carly is going to take two companies, each weakened by current economic conditions, and combine them. Where exactly is the synergy? Two manufacturing organizations, neither the lowest cost nor highest quality in their market, and both in thrall to Intel? That's a good combination.
Well, both companies have been weakened by a decrease in PC sales, but they're both still profitable. I'm not convinced that they're weak companies. And cost-cutting through layoffs makes plenty of sense for companies which are merging exactly because of the overlap you mentioned. Whether or not a synergy will develop and the merger will work is hard to say, but this is not a case of two desparate companies trying to survive by merging. This is a case of two profitable companies trying to merge into a bigger player in their market.
And as a side note, no PC manufacturer is in thrall to Intel, and especially not these guys. AMD and VIA are too successful in the desktop market right now, and the company which owns both Alpha and PA-RISC doesn't need the Itanium. Besides Intel doesn't want to lose the second-biggest PC manufacturer's support either. Not that this new company would want to ditch Intel -- many people still buy Intel because it's the biggest brand name. I'm just saying that it's theoretically possible for "Hewlett Compaqard" to survive without Intel.
Gay male? Female?
Hey, at least you were in the ballpark.
Considering that the iPAQ is the only halfway-decent PocketPC to date, this has major implications for the PDA world. Especially since the iPAQ is also used by the most successful Linux-on-PocketPC distribution to date, MicroWindows....
--GrouchoMarx
Card-carrying member of the EFF, FSF, and ACLU. Are you?
Hmmm.. it seems as if this merger is not only to knock out operational expenses, if not also another competitor in three arenas. HP was losing to Compaq in the PC segment, and also the intel standard servers. Both Compaq and HP have had a hard time getting a real large install base for thier UNIX line. Compaq just licensed out the Alpha processor technology to Intel. So which OS will be the first to drop? HPUX or Tru64 and OpenVMS?
I would place my bet on HPUX. HP has too much 32-bit baggage to carry over into the new Itanium UNIX standard (even though IBM will not be joining that party) and Tru64 has no 32-bit baggage to carry over since it was 64-bit to begin with. Tru64 (or the AlphaServers for that matter) were finally being accepted in the market as powerful and versatile alternative to AIX/HPUX/Solaris. I would personally want to see Tru64 go on, but we'll see.
Cheers,
Justarius
- There are some that call me . . . . . . Tim.
I am the Spirit within The Machine.
September 4, 2001
Hewlett-Packard to Acquire Compaq in $25 Billion Deal
By ANDREW ROSS SORKIN and FLOYD NORRIS
Hewlett-Packard will announce today that it is acquiring Compaq Computer for $25 billion in stock in a bold move to grow as the computer business struggles with shrinking sales, executives close to the negotiations said last night.
The merger, if completed, would produce a company with total revenue only slightly less than those of I.B.M., the largest computer company. But both Hewlett-Packard and Compaq have recently seen revenues slide and profits plunge because of a computer industry slowdown, and both have announced job cuts.
For Carleton S. Fiorina, who became chief executive of Hewlett- Packard in 1999 when she was hired away from Lucent Technologies, the acquisition amounts to a renewed bet on the computer business and particularly a new operating system for computer servers that was developed by Intel and Hewlett-Packard. Compaq is the other large company that has announced it plans to use that technology, which will compete with technologies developed by Sun Microsystems and I.B.M.
Late last year, Hewlett-Packard had tried to move in a different direction that emphasized services by acquiring the consulting operations of PricewaterhouseCoopers, the large accounting firm. But that plan fell apart as Hewlett's stock price declined.
Compaq, which is based in Houston, began in 1982 as a maker of personal computers. It became a phenomenal success in its first 15 years but has stumbled more recently amid severe price wars in personal computers. Its 1998 acquisition of Digital Equipment, itself once the second-largest computer maker, has not been viewed as a great success.
Investors in both Compaq and Hewlett-Packard have suffered in the current decline in technology stocks, although Compaq's woes have taken a greater toll. That stock is down 76 percent from its peak, reached in early 1999, while Hewlett- Packard is off 66 percent from its peak, reached last summer.
While the executives involved in the talks said that an agreement had been reached that provided for Hewlett-Packard to acquire Compaq, exact terms of the offer were not disclosed. They said, however, that a premium is being offered for Compaq's stock, which closed Friday at $12.35, down 34 cents, while Hewlett- Packard shares fell 19 cents to $23.21.
The executives said that Ms. Fiorina would become chairman and chief executive of the combined company, which will be based in Hewlett- Packard's home town of Palo Alto, Calif., while Michael D. Capellas, Compaq's chairman and chief executive, will become president.
Spokesmen for both companies declined to comment last night.
When announced job reductions, of 8,500 jobs at Compaq and 9,000 at Hewlett-Packard, are completed, employment at the companies will be about 62,800 at Compaq and 87,000 at Hewlett-Packard. Further reductions seem likely, as executives said that they expect annual cost savings of $2.5 billion within several years.
In its most recent 12 months, Hewlett-Packard reported revenues of $47 billion, while Compaq had revenues of $40 billion. The combined $87 billion is close to the $90 billion reported by I.B.M., and far above the $33 billion for Dell Computer, which now ranks fourth and would move to third if the merger is completed.
In its most recent financial report, for the nine months through July, Hewlett-Packard said its revenues were down 5 percent from the comparable period a year earlier, to $33.7 billion. But its net income fell 82 percent to $506 million. Compaq, reporting on the six months through June, said revenues fell 13 percent to $14.2 billion. It suffered a net loss of $201 million for the period, compared with a profit of $684 million in the same period of 2000.
Compaq had hoped that Digital Equipment technology would provide it with a competitive edge in new generations of computer servers. But it recently chose to not use that technology and instead go with the technology developed by Hewlett-Packard and Intel.
Both Hewlett-Packard and Compaq have been hurt by price wars in personal computers, where it has been difficult for makers to differentiate themselves when all except Apple Computer are offering operating systems from Microsoft.
Many in the industry hope that the trend toward decentralized computing, in which great computing power migrated to desktops in homes and offices, will reverse itself as a new Internet-based system uses racks and racks of powerful computers known as servers whose computing power will be called on by computers and cellular phones around the world. If that vision is realized, then a major battle looms over which maker of servers is able to gain a dominant position.
If you could marry Taco's brains with Bill Gates' good looks.
Or did I get that backwards?
This seems like a really bad deal/trade off if you ask me. I don't know why any two companies of this size would want to merge together, I just lost what little respect I still had for these two companies now hehe.
Admin - www.newspad.org
NewsPAD - the daily news source for geeks!
For shame, Bruce! Now, stop entertaining me for free, and go kick HP/Compaq in the ass, willyah?
If they think this merger will make them instantly successful, they are in for a rude awakening.
That UNIX was dead, they wern't going to do much more with HP/UX, and instead go with NT?
The losers: Alpha (duh) and VMS.
Ipaq's are a different form factor than the other HP products, so they may survive beyond the merger.
Who can stop this: The government (I doubt) and the stock market. If the market thinks this is two failing companies combining, hey will drop both stock prices.
Either way, Tue will be interesting tay for tech writers.
If it was said on slashdot, it MUST be true!
When mergers like this occur during the wonderful times of "irrational exuberence", the resulting behemoth has to pay down an asset called "Goodwill". This is what they (over)paid beyond asset value for the company that they euphorically, and often stupidly, bought.
In the case of the huge AOL/Time-Warner merger, note that their balance sheet still has a $126,618,000,000 asset called "Goodwill and other intangible assets" recorded in June, 2001. This asset may look impressive on first scan, but the fact is that AOL has to pay this down over many years according to, I believe, requirements of accounting standards (GAAP).
Many smaller companies have serious "indigestion" from this effect and sometimes have sudden "charges" of billions to pay for previous lapses of good business judgement in the past. And wouldn't it suck if the stock price of the merged, over-stuffed company rapidly plummeted? I know that there are folks reading this who personally know what I am talking about.
In the merger between HP and Compaq, for obvious reasons the resulting "Goodwill" asset will be beneficially minimized. Correct me if I am wrong, but it looks as if the new HP is paying $25.0B for $23.9B of Compaq assets. This is going to create a behemoth all right, but one with out a food coma.
If HP and Compaq really want to get together then the conditions at present are optimal (unless they want a really big-ass number on their balance sheet for ten years).
http://www.cnn.com/2001/TECH/09/03/hewlett.packard .compaq.ap/index.html
It fell flat on it's ass for trying to take on the industry. They had an open source prodcut (ISA), saw what they COULD have made had it been close sourced, created something new (MCA) and closed sourced it.
Hence the formation of EISA and the collapse of MCA. Open Sourcing (so to speek) MCA resulted in PCI (not completely, but a good chunk of the PCI spec is MCA type stuff)
As a rock-in-roll Physicist once said, No matter where you go, there you are.
Many in the industry hope that the trend toward decentralized computing, in which great computing power migrated to desktops in homes and offices, will reverse itself as a new Internet-based system uses racks and racks of powerful computers known as servers whose computing power will be called on by computers and cellular phones around the world. If that vision is realized, then a major battle looms over which maker of servers is able to gain a dominant position.
That's just silly. Vast home computing power more available than ever [at prices lower than ever]. There is no compelling reason for consumers to ever want to move to a situation of software as service. Wow! I will be able to access my email or play my media files on a random terminal elsewhere, on a cell phone, or at an internet cafe'-esque public terminal. Wait, I can already do that!
Of course, the public tends to be extremely stupid, and perhaps such hailstormy functionality neatly packaged up in a user friendly way will have some appeal...
But wait, if there is going to be connectivity everywhere, why the heck bother paying a continuing lease to store ones personal data on someone else's server, when it can simply be stored on one's own? If there is a marketable demand for such services [to be super userfriendly for non-techies to set up and use], believe me, there will be secondary products that offer the same service in a truly secure, encrypted tunnel [from said random public terminal] to your own machine!!!
I mean, seriously, people, if something like hailstorm is ever to be feasible, there has to be significant bandwidth/connectivity all over the place; and with affordable home computers all over the place, what could possibly be the compelling desire to pay an additional rent to store data and access applications on servers owned by other people?
Language like that makes me worry. I can't believe the industry could be considering something so dumb.
---
the pen is mightier than the sword, the sword is mightier than the court, the court is mightier than the pen.
It's gonna be a total pain in the ass finding Compaq drivers now. That always happens when companies merge. DAMN DAMN DAMN!
MS Visual Fortran 4 begets
Digital Visual Fortran 5 begets
Compaq Visual Fortran 6 begets
HP Visual Fortran 7?
"Open the pod by doors, Hal" > "I'm afraid I can't do that, Dave" sudo "Open the pod bay doors, Hal" > alright
What better than for Atari to purchase HP? There is a minimum of overlap, and the HP name could really help Atari in the datacenter arena.
I'm stunned. I'll admit, I was betting HP or Gateway would fold out of the business some time this year due to plunging market share. Out of the Business = stop making Intel based computers.
I did not expect HP to go out and buy Compaq.
But is this a good thing? HP has never been a player in the corporate desktop world to the extent of the other vendors. So I see the desktop line dropping away. Being in the Intel server business I can safely say that at least in the KS/MO areas HP is not a competitor either. So there goes the Intel Server line from HP.
But, HP is a R&D company. HP has big pockets from other divisions. HP has a service arm that can execute better than Compaq's (even after aquring Digital, I'd say Compaq Destroyed Digital in their blundering of that purchase) and hasn't had a decent service arm (at least in KS/MO/OK/AR region) ever (for Intel Servers).
Should be interesting. A merger of this size should take a good 12 - 18 months, so the fallout will be a while. Wonder what the heck they're going to do. Dell is still destroying the market into a commodity driven vs. quality driven, especially in the server market.
Please ad grains of salt to the last one, I don't like Dell. I'm sure many people do, I don't.
As a rock-in-roll Physicist once said, No matter where you go, there you are.
Compaq sold Alpha to Intel, check here http://aceshardware.com/Spades/read_news.php?post_ id=50000292 for more info!
--Sorry about my bad English!--
look at the official press release
Serious man HP support blows. And so does my ipaq - which has been in the shop twice now...
See above.
But wait, if there is going to be connectivity everywhere, why the heck bother paying a continuing lease to store ones personal data on someone else's server, when it can simply be stored on one's own?
.net. If it's true that consumers will want somebody to manage their desktop software for them (and I'm not convinced that they will, but it's plausible that at least some will) then those consumers will probably want someone to run the application server for them so that they don't have to maintain it.
.net if and when it ships. But for those consumers who choose to use .net, I would think they'd be willing to shell out significant money to have someone else run the application servers. This isn't stupidity on their part-- it's just that most consumers have neither the time, nor the expertise, nor the interest to run their own servers.
Um, backups? Uptime and reliability? Economies of scale? Security? Lack of technical expertise on the part of consumers?
Look, in theory anyone with a DSL connection can run his own web server, mail server, etc. Yet, most don't. Why? Because that's what we pay ISP's to do--maintain fast, reliable, secure, servers that give us the services we want without us having to do the work of changing backup tapes, patching the OS when security holes are found, wearing a pager 24/7 to ensure good uptime, etc. Running a stable, secure, reliable server is a lot of work, and it makes sense to pay someone else to do it.
So it is with
I personally like having my software locally, and I don't want Microsoft or anyone else changing it without telling me. But then, I'm typing this on a Mac, so I don't have to deal with MS crap as it is. I have no plans to use
I seem to recall that Tandem did bail Compaq out with a loan though. Flash forward several years to an ousting of the founding CEO, and Tandem being prepped for sale by the new one. Bought by Compaq, who totally destroyed the sales organization (and strangely enough most of Tandem's sale too). Soon after that, they bought DEC, and destroyed it's sales organization in almost the exact same way (takes talent!).
As a Tandem employee at the time of the merger, I found Compaq to not really be a "new wave" company. They talked the talk of employee empowerment, but were more like GE or a telco (aside: Scott Adams of Dilbert fame worked for Pacific Bell), than a typical Silicon Valley company following the true "HP" way. The Compaq CEO and bureaucracy were not used to having a middle class (engineers and professionals); and tried to treat all it's employees as a factory worker or an executive. We were not treated as executives, except for international travel!
The new insider Compaq CEO, after the destroying CEO was ousted, provided some peace in the lands that were formerly Tandem, sounding similar to a manager that valued it's employees. Alas there was still much turmoil, and I parted company to the relative stability of a start-up. I wish my former comrades well. I envision their times might be easier, for I judge HP way is more powerful than the Compaq way; if there is any way left!
Alpha was already dead at Compaq. PA-RISC was withering on the vine at HP. SGI is moving away from MIPS
....
All will move to Itanium, probably.
This leaves IBM Power & PowerPC and SPARC as the only credible alternatives to the Intel and clone market.
Irrespective of the *technical* aspects, those other architectures ship a tiny fragment of the volume that Intel ships
Just one man's opinion.
Maybe HP can show Compaq how to make a recovery disk with actual drivers on it and drop the stupid softpaq crap.
---- "Excuse me. Where's the children's gun section?"
New , EV-PARisc technology from HPaq!
The scariest thing about this merger is the totally inept Carly F. gets to run the joint. She has never typed ps -elaf or ps -auxww in her life yet she runs the 2nd larget computer company?
Scary.
FYI, Carly majored in Medieval history at Stanford. At least Gates and Allen can brag about actually having known something about computers at some point, albeit Altairs. Not that being the only non-Unix vendor left is a good isea.
- Z
Legalize the constitution. Think for yourself question authority.
You laugh...
But I can see it now: PCs with the AOL Kiosk OS pre-installed, and Dell doesn't get to advertise on TV anymore. Instead, we just get to see the latest box from AOL/Hewlett-Timepaq.
I just don't get it. You don't magically make money through mergers. This doesn't address the problem and just ends up hurting competition, srewing over a lot of people, and causing a lot of promising technologies to completely vanish (Alpha, for example).
That sounds like an overly cutesy Star Wars character name. Maybe Jar Jar's partner in the coming movies?
It's interesting how Tandem Computers was started by ex-HP employees. Compaq purchased Tandem, and with HP purchasing Compaq, Tandem is folded back into HP. Kinda like Apple/NeXT.
Based on someone who I know that works at Compaq, this is exactly right - Compaq did not believe that they would be able to compete against the Itanium within four years and that it would be better to not alienate Intel now so that when they had to switch they would be in a better barginning position. Since Intel is a chip manufactorer and Compaq has many product lines, it makes sense for Compaq to ditch that which it can't use and move onto the solution that is likely to win in the future.
Apparently the higher-ups at Compaq found that their expected roadmap and the Itanium's would clash in the next four years and they did not feel like trying to compete with someone who provides parts for other product lines.
To avoid getting myself or the Compaq employee I know in trouble, I'm posting anonymously - yes, I'm a coward.
(HP... Holy Poop....? eh, forget it...)
What made the two largest computer companies in the world profitable:
Extremely high prices on otherwise free (Linux) software.
Do you like German cars?
Look into them. You're going to burst a vein in your head.
If the merger happened in a bull market, you might have seen a rally. However, I think the Wall street might punish this deal. If you intend on getting into HP/Compaq bigtime, you are probably better off waiting a bit. Just my $.02.
-- Another senseless waste of fine bytes.
Consider the size of these companies. Buying a competitor is just the first step. Truly merging on an operations level will probably take serveral years.
Yay. ANOTHER big corporate merger.
Call me paranoid, but IMO this is just getting ridiculous. I lost all faith in the government's enforcement of the concept of anti-trust when they let AOL and Time Warner merge. Of course, (HP + Compaq) < (AOL + TW), but come on...
How many huge corporate mergers are we going to have? Soon we're just going to have one giant corporation controlling everything. My video card's boot message ("3Dfx Interactive Inc.* \ A subsidiary of the AOL-Time Warner-Microsoft-Intel-ABC-NBC-CBS Corporation") will be true one of these days, at the rate we're going.
Notice the words "buying a competitor" in hillct's post. On a smaller scale, such as at the local-local level, this isn't such a big deal. But when you take two large corps that are competing against one another (plus only a couple others) for business nationwide, and let one buy the other, that's one less choice for the consumer. It's also one (much) larger corp that, due to its size, has to spend that much less time worrying about its competition. In the end, the consumer loses.
* Now owned by nVidia. Granted, 3Dfx was having tough times financially, but still...
I pledge allegiance to the flag...
of the Corporate States of America...
Another article confirming this...
From Australian PC World
Here
-AndrewJNR, NSO, The Don College
Compaq for $25B? Actually, the purchase of Atari for $2M makes a whole lot more sense if you think about it. Hopefully it'll make SegFault soon. ;)
There's lots of reasons this could be REALLY bad, but there is a snowballs chance in hell that it could work.
On the higer-end (PC-servers and up), this may bode quite well...
HP has always had great technology, but has generally lacked the capability to take the tech they came up with and get it into a good product (certain printer lines being an exception).
Compaq, OTOH, has never been much of a technology developer, preferring to buy other companies that have already done the lions share of the R&D. Compaq has been able to take that tech and turn it into (generally) good products.
On the desktop end, it doesn't really matter that much, though hopefully the Proliant's stick around instead of the HP line for the higher end desktops. The low-end consumer stuff is screwed no matter which way they cut it.
As for the rest of it, there is a huge amount of overlap in the product lines. That's obviously bad for Alpha, which kinda sucks, but kinda doesn't. The overlap is also going to mean some killer layoffs at some point down the road. Hopefully the *nix pieces get combined in some manner, instead of just cutting one side of it. On second thought, maybe they can finally take the opportunity to put HP-UX out of it's (and our) misery. I'd like to see their Linux efforts continue for sure. I'm not at all familiar with Tru-64.
Who knows, it's possible that this will be good for the tech industry. It certainly could be, and I, for one, hope it will be.
How can saying that a marriage between compaq and HP is unusual be offtopic? Geeeez.
Was thinking about the ramifications of this merger, and thought I'd look for some server market share statistics ( http://serverwatch.internet.com/news/2001_08_02_a. html ).
You have Compaq, Dell, IBM, HP, Sun, and the "Others" category.
Now we shall have Dell, IBM, HP, Sun, and "Others".
This stat is entitled "Preliminary Worldwide Server Unit Shipment Estimates for 2Q01", and both HP and Compaq lost market share. Looking at market share off of this chart, HP would then have 37.3% of Server Units shipped (estimate). That alone makes HP all of the sudden the #1 company with servers shipped for Q'2 2001. Impressive...
Also note that the stats I am referring to are for the worldwide market.
Of course, I'll stick with my commodity Dell servers, and (if need be) Sun/IBM Unix servers.
The woman is damned smart. Personally, I would have to rank her as the most intelligent, dedicated, and insightful executive in Silicon Valley. A merger of this size will take many long nights, over many years, to fully become a reality. And I think Carly Fiorina has the dedication, knowledge, and experience to do it.
Think about it. She did wonders at Lucent.
I think what is most important, what differentiates her from the other executives in the industry, is what she knows about this industry.
"Virtually all meaningful advancements in business, society, and life are not achieved through the boldy acts of a few, but the everyday acts of many."
Cut through the marketing fluff of that quote she made last year. And you see that she really does have a clue of what runs a company. What runs the whole industry. Truly, what has, and always will run this world.
Her degree is, if I remember correctly, not in information technology or business... But actually in medieval studies. What do we learn by studying history? The mistakes people have made, and hopefully we learn to not make them again.
She's a smart business person. She sees the mistakes Compaq has made with Digital and Tandem. She knows to not make those same mistakes again. And she knows that her job depends on not making any mistakes. The hp Board is patient, but they're not going to sit around for a decade, while she's pushing her sixties still trying to get hp back on track. Carly has a year at the most to prove that she can head this megaconglomerate. She knows how to streamline (see latest quarterly report).
If she can pull this off, I would have to credit her as the most successful executive in history. If not, she can move on over to Nevada and take up stripping.
Which do you think she's planning on, and working towards?
jrbd
http://news.cnet.com/news/0-1003-201-4500953-0.htm l
Analyst predicts PC vendors must consolidate or die
By Larry Barrett
Staff Writer, CNET News.com
January 16, 2001, 6:10 p.m. PT
Bear Stearns PC analyst Andrew Neff after the bell Tuesday fired off what he called a "manifesto," recommending massive and immediate consolidation of the major U.S. PC vendors. Some of his contemporaries strongly disagreed.
After watching profit warning after profit warning from major PC makers in recent weeks, Neff said the industry is at a "critical stage." The PC sector will unravel because of overcapacity, a problem that has plagued other industries. PC stocks will continue to erode unless companies take "concrete steps towards consolidation."
Among Neff's suggestions:
Compaq should sell out to HP.
Actually, that is quite on-topic. But it is still a troll.
This is probably the only logical merger if any in this industry.
Look into them. You'll get your panties out of a wad.
This is what I found interesting.
"Both Hewlett-Packard and Compaq have been hurt by price wars in personal computers, where it has been difficult for makers to differentiate themselves when all except Apple Computer are offering operating systems from Microsoft.".
So it looks like MS is holding the market back. Big surprise.
Corporate:Make it so!
Compaq Tru64 is mushed together with HP-UX. Talk about to totally different Unix's. Remember HP-UX, very strong in manufacturing, but don't ask what SAM can do for you, ask what it can do to you.
Then there is Tru64. Tru64 hands down has the easiest and best clustering in the industry. A reputation as a real number cruncher. Part of this of course was because of the Alpha. Now what?
Maybe we will get lucky and Apple will purchase Tru64 from HP/Compaq. That would make it realy sweet!!!!
If the computers put out by both companies suck, that will make dual suckage.
2 * -1 = -2
I don't think I'd worry about a "monopoly" in this case.... This merger's gonna tank like the Edsel!
-- The short version Compaq + HP + Intel + Linux = Good for them, bad for AMD, Microsoft, Dell, and Sun.
Here we have the "merger" of two huge UNIX vendors whose UNIX stuff had begun floundering over the last few years. On one hand we have Compaq. Compaq has flirted with Linux here and there, but has never jumped onto the Linux bandwagon for fear of reprisals from Microsoft, which could do a good deal of damage to Compaq's desktop lines, once the highest sellers in the industry.
On the other hand we have HP. HP has been jumping all over Linux in the past two years, openly working with intel and SuSE on IA-64 Linux. HP has not been relevant in the desktop world for some time, and their NT based servers went nowhere. Faced with a company working on multiple system architectures with two aging UNIXes, both of which are losing market share to NT/2K/Solaris at an alarming rate. On top of that HP's RISC processors are also losing steam, and Compaq's failed takeover of Digital makes it unlikely that anyone will be picking up on Alpha any time soon, especially given that the good Alpha engineers are now at AMD. What is HP to do? Seems to me that HP is likely to jump in on the Intel/IBM/SuSE dealings (If HP is not already a player in that arena, which aI suspect it is.) and move the new company to Linux on IA-64 in the datacenter, and Pentium IV powered desktops running XP. It would also not surprise me to see HP and Compaq shed their worst desktop engineers that led them down the losing path, and have the remaining good ones build high-end LInux powered workstations for the Linux loving folks in Hollywood, a market currently owned by SGI, and one that Dell managed to fail in.
The downside to all this is that the new HP will likely shed AMD, which Compaq has been pushing for a while. By moving to IA-64 HP will have a fighting chance against the powerful Dell/Intel/Microsoft combo that is pushing its way into any market it can. If IA-64 on Linux can start scaling well withing the next two years, HP will also have a chance to start gunning for Sun, who is perceived by many as behind in the processor market due to their "slow" megahertz speeds, not to mention unhappiness with Sun's high prices.
Of course, given that HP's CEO is a former Lucent exec (They grabbed her in 1999.), I think there is just as much of a chance that this whole thing will turn into a huge fucking mess, with money thrown at all the wrong things. It really would not surprise me if HP is reduced to producing garbage desktops that make Compaq machines look good, and even more crappy $100 inkjet printers that drain $30 ink cartridges every few pages.
I hope they continue with alpha support and tru64.
Aliens? Magnetic Rings?! Bah! Who needs that when we have
Yes, but it is easier when there is a link. And Slashdot editors cannot do that.
Boy I'm glad I sold my house in Austin in January! First the Dell layoffs and dot-com bust killed the Austin market... The shell-shocked victim techies started migrating to Houston to do the Compaq thing. That great big sucking sound you hear is Central and Eastern Texas collapsing.
--Rob
Will they stay independant companies? Or create a totally uncreative new name?
... or HAQD, for short. :)
My vote is for HP-Alpha-CompaQ-DEC
Hmm, I wonder what is going to happen for development between the Jornada and the iPAQ? Maybe the could force Compaq to get the damn device to have more than one input at a time!
This pits giants IBM and HP (moving towards cheap, commodity Intel power) against SUN (using proprietary chips).
Can SUN survive by giving away software and funding the development of its own chips?
Goto sleep people! It's not the end of the world yet!
PS: EOTW is predicted tomorrow, when MS buys Sun.
Remain "Compaq" OR become "Hewlett packard"?
-- Hasbullah bin Pit (sebol)
This is like a Beowulf cluster of companies...
Sit back and relax as Windows 98 installs on your computer.
However, the fact that OS X has apache server built in makes it very desirable.
Apache HTTP Server is also available for Win32 machines (9x/me, nt/2k/xp). Here's a direct link to the Win32 binary/source distro (win95 needs Winsock 2; nt4, 95, and 98 need Windows Installer for nt or 9x). It's good for web development on machines that also have to run Office (say for students who can't afford to own several machines) and also good for file sharing.
Will I retire or break 10K?
you are wierd.
I'm a big retard who forgot to log out of Slashdot on Mike's computer! LOOK AT ME.
Corporate consolidation almost always accompanies industrywide slowdown. That behavior is as predictable as the rising and setting of the sun. Look at it this way - most of the brass will get to keep their jobs; some will get promoted, some demoted, but very few fired. Workers, on the other hand, are gonna get pink slipped because suddenly their services are "duplicated." The market just can't accomodate as many tech-behemoths as it could 2 years ago, so the logical thing to do is merge.
I think there is a world market for maybe five personal web logs.
Don't UnPaq!
My forecast: 2-3 years of chaos for their customer, revenues drop by 20-30%, US$10-20 billion losses plus writeoffs of goodwill, etc., etc. They have a total of 150K employees right now, I reckon we will see that number hit 100K within 3 years.
I base this on the history of past mergers of troubled IT companies such as Compaq/Digital, Sperry/Burroughs, etc., as well as my own experience (as a regional department manager) of going through a merger that formed a major IT services company.
Ever since the early '90s I realised that a company has to be very good at hardware or software or services. Try to combine them and you have a recipe for failure, with the notable exception of IBM who are so big that each of those lines of business makes them one of the bigger players. All the old mini-computer makers who tried to combine the 3 businesses are gone, losing money or barely profitable. HP was the last one still standing.
check out Compaqs Release http://www.compaq.com/newsroom/pr/2001/pr200109040 2.html
h tm
and HP's http://www.hp.com/hpinfo/newsroom/press/04sep01a.
Pretty Tired but i think they are the same article... they already are merging hmmm.
Another note one the main HP page there is a big pic of Tux and a Sentance HP Linux Evangalists... something or another
"All I can tell the "lesser of two evils" folks is that if they keep voting for evil, they'll keep getting evil."-Lp.org
Is MIPS still around other than embedded systems?
Depends on whether or not you consider Sony's PlayStation line of game consoles to be embedded systems. PS1 used a MIPS R2K (or R3K?). PS2 uses a custom EMOTION ENGINE(tm) processor based on MIPS architecture. PS2 already runs Linux (if only in Japan at the moment); would it be hard to build a cluster to run Apache HTTP Server or a parallel CG renderer?
Will I retire or break 10K?
Yes, she is smart. But every HP product I've installed recently has given me error messages. Some of the problems have been so bad that even HP tech support could not solve them. For example, an HP network printer assumed that a network had a server, instead of being peer-to-peer. The problem was unsolvable.
I see no evidence that Carly is better than Lew Platt. Maybe there is such evidence, but I don't see it.
There is always a lot of hype around executives of large companies. The truth is often very different.
Bush's education improvements were
Doubling the size of the Titanic would only have caused it to sink twice as fast!
This is incorrect. Larger ships have more buoyancy, and as a result, it takes that much more volume of water to cause them to lose it. The Titanic took a long time to sink because there was a very large hull to fill up with water. Now, take a cooking pot, punch a hole in it, and see how fast it sinks. That's hardly anywhere near the size of the Titanic, yet it will sink almost immediately instead of over the course of a couple hours.
I highly recommend you watch the summer block buster Titanic, starring Kate Winslet and Leonardo Decaprio. It's a highly educated, historically accurate portrayal of this tragic event and will even reveal to you what the upper portion of a naked woman looks like.
Why bother.
HP is not a huge company that makes a variety of computers as their main business. An absurd amount of their profit comes from sales of printer cartridges. Actual printers are a decent business as well. Considering that Compaq computers often sell with a Compaq printer (OEMed from Lexmark I believe), I have to ask if this isn't as much about hurting a rising competitor in the printer industry as much as anything else?
Moreover, considering how weak HP's computer business has been - both desktop and server - for the company, aquiring Compaq might be a good idea since Compaq is more comfortable in this segment. Overall though, I don't think either of these companies alone had what it took to survive in the server market against IBM and Sun or in the desktop market against Dell. I'm not sure the new company will have the capabilites, but it might.
After the MIPS, exit the Alpha, exit the PA-Risc (to be replaced by the Intel IA64).
Now the remaining outsiders are: Sparc, RS6000 and IA64.
I am not quite sure I appreciate this as the workstation market used to be quite wider.
and I still don't reckon the G4 or the P4 are relevant for workstation use.
Trolling using another account since 2005.
Hewlett Paqard. Complett Haqard
---
Not necessarily the survival of the fittest computer, but the survival of the fittest corporate leg humper. The best corporate weasels are going to be able to keep their products alive.
Remember, it isn't the product. It is the perception that sells.
now my pot has a hole in it.
be realistic
ps -elaf is crap because -a has no effect in
the presense of -e. Both are process selectors,
ps displays the union of selections, and -e
selects everything anyway. (this is the behavior
defined by POSIX and the UNIX standard)
ps -auxww is crap as well. If you were looking
for a user named xww, add a space. If you meant
to use BSD options, then leave off the damn
hyphen/dash/minus thing to be more portable.
Of course BSD options are non-standard crap
by definition, but we can ignore that.
Yeah... but the edge of a cliff? Actually, it does sound kinda newsworthy. Either Fiorina is going to go down as an idiot, or a genius.
...are less competition a good thing for the public?
can afford to build VERY large Beowulf clusters!
Now Carly is going to take two companies, each weakened by current economic conditions, and combine them. Where exactly is the synergy?
When two company's with the same product combine, they often can make more money than if they were seperate. A combined HP/Compaq can cut the sales dept, IT overhead and many other redundant corporate systems but maintain the same volume of sales. Instead of competing with each other for a sale, they now are partners. Now that the x86 market is saturated, it is obvious that there are "too many fish in the pond" and it makes sense for PC makers to want to merge. When a product has small profit margins, a company has to copensate the margin with selling in higher volume.
I miss the Karma Whores.
Once upon a time there was a big company who rules the world of computing with its big mainframes. It was called IBM. Nobody could compete with this giant. But then a small challanger appeared, named himself Digital Equipment.
The giant feared him, because these small reliable minicomputers were more adaptable and inexpensive compared to the big mainframes, and they multiply like hell. The big company tried to make minicomputers too, but the challenger still occupied the area.
And so everybody was chanting: "IBM is gonna dying...".
But one little branch of the dinosaur was getting strong. It was called Personal Computer and was DECs nightmare, because they were more adaptable and inexpensive. But alas, another challenger appeared, called Compaq, and its PCs were even cheaper and smarter and multipied like hell.
And so everybody was chanting: "IBM is dying..."
But the climate gets rough, and Compaq eats DEC. And than Compaq was eaten by another Dinosaur...
And nobody was chanting.
And lesson of the story?
Don't dance on open, empty graves.
Once upon a time there was a big company who rules the world of computing with its software. It was called Microsoft. Nobody could compete with this giant...
It all depends. If the executive leg-humpers in that department aren't up to snuff, it'll be known as Visual Fortran DISCONTINUED.
Despite not being as overwhelmingly monopolistic as they were in the 1980s, this shows just how huge IBM still is - the number 2 computer company, HP, buys the number 3 computer company, and becomes...still number 2. Still can't pass IBM, even combined.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
...because HP's "support" is not something I've been terribly impressed with.
When Adaptec bought out DPT, it was mainly to get their hands on decent RAID technology because Adaptec(rap) couldn't seem to make a decent RAID adapter to save their lives. I wrote to DPT's support department at the time, expressing concern that their support for legacy DPT hardware would suffer because they had been bought out by, as I put it, the 'Microsoft of the SCSI adapter industry.'
Oh no, they hastened to assure me in response. Our FTP site will be untouched.
Meadow-muffins! Less than a year later, the entire DPT support site was moved to AdapteCrap's. A number of files for DPT's older RAID and caching SCSI host adapters mysteriously vanished, never to be seen again, and no one's owning up to how or why it happened.
If HP pulls the same stunt with DECompaq, will there be any support left for any hardware over two years old?
I don't know if this is going to be good, bad, or indifferent. From what I've seen, though, the quality and quantity of tech support is inversely proportional to the size of the company in question.
In short: Better start archiving any older support files you may need from Compaq's FTP and web sites. HP may decide to clean house.
Bruce Lane, KC7GR,
Blue Feather Technologies
All the idiots of the world are now doomed. 2 crappy computer manufacturers teaming up to build the least upgradable, overclockable and user "friendly" computers ever. Get AOL in on this and I forsee the end of the world. (Sidenote, i have no problem with the HP printer and related products. Just the computers)
The companies said they expect the deal to close in the first half of 2002 and to result in a cost savings of $2.5 billion by the middle of fiscal 2004.
There is no way the "new" HP is going to make those types of savings without more rounds of layoffs to eliminate redundant staff in the two companies. This indeed may be a bumpy ride for many long-time HP staffers (Deja vu for any former DEC employees still around). This is certainly what the stockholders are expecting and the stock value will dive if more cost-cutting measures aren't announced soon and implemented quickly. I'd certainly expect a lot of consolidation and elimination of current divisions in the 2 companies (bye bye HP PC group!).
In a stunning move, stunning because of the lack of a sense of history, HP simply repeats the same blunder it made when it purchased Apollo to temporarily become the "Number One Seller of Workstations". Only this is on a larger scale.
Absolutely. I used to work for HP back in 1989 when they made said aquisition. Within the hallowed halls, there was much rejoicing. Everyone was told, hey, now HP will make better workstations using Apollo technology! Didn't happen. Instead, all the Apollo techs left in disgust, and Apollos were killed dead. (I'm not entirely sure of the order in which that happened, though!) (-8
Prediction: Massive layoffs at Compaq, destruction of Compaq computers, little assimilation of technology, little merging of the workforce. They may actually delude themselves that they will make use of Compaq resources, but company mergers never work. One company always swallows the other, corporate politics and survival-of-the-fittest reign.
From what some people have been saying, HP's corporate culture is still better than Compaq's, so that's one hopeful thing -- if HP is the winner in the silent battle.
Unfortunately, when one's job is on the line, nobody is going to be objective in evaluating whether Project A or Project B is the better one -- even if Project B is obviously miles better than Project A, if some middle manager loses power if things go with Project B, they are going to push Project A for all its worth(less). Human nature.
Now imagine that happening multiplied by thousands, for the thousands of employees who are going to be laid off by this merger. Don't expect sensible decisions.
In case you're wondering how I left HP... our section was "downsized" because Head Office wanted to get out of Applications Software... But it was a nice place to work while I was there, and they tested things to death. Quality control, you betcha.
So, despite all my doom and gloom, I don't think HP will die. Just don't expect anything wonderful out of this merger.
-=- Say it with flowers. Send a Triffid. -=-
Kindly do a Google search on terms such as "Itanium PA-RISC binary compatibility" and/or "HP-UX". The entire point from HP's perspective of working with Intel was/is to guarantee that the Itanium would have binary compatibility with PA-RISC and HP-UX. Any hint of incompatibility, any hint of the alliance breaking, and HP would cease to exist in five years. The company could not survive if it could not guarantee an indefinite upgrade path for its existing customer base. Itanium has been part of that promised path for over five years now.
I have similar doubts about HP being able to keep many of its major customers if it tried to sell them on converting the entire product line over to Linux regardless of how many capabilities Linux acquires. Mandating switching to Linux from HP-UX to "save costs" would be of benefit only to HP not to the customers. Alienating major customers for reasons internal to one's company seems to me one of the fastest ways to run one's company into the ground.
Is this just a big excuse for axing more redundant positions in the new combined company?
------------
SF Board: www.sfboard.com
When Compaq swallowed Digital, I felt weird. You see, I started my career on Vaxen in the 1980s, Having a PC company buy the former #2 computer maker seemed strange. For me, it was as strong an indication of how the world had changed as anything that happened in the 1990's. I know it's irrational, but having HP take over somehow seems more fitting. After all, DEC and HP battled it out with Sun and IBM for the Unix market. DEC lost that battle big time, which was a big contributer to its eventual demise. It's funny, I haven't used VMS in over ten years. I'm completely coverted to Unix and Windows. but I still hold on to these ideas I formed at the beginning of my career. Neither Compaq or HP are the same companies they were in the late 80's.
Enough rambling. I wish them luck.
"Even if you are on the right track, you'll get run over if you just sit there" - Will Rogers
Today software, media, entertainment giant Micro-TimeWarner-AOL-Soft came to an agreement with the US justice department regarding a controversial licensing practice that they and their partner, pharmaceutical and computer hardare juggernaut, Pfizer-Hewlett Compaqard Dell had been requiring users to agree to. AOL Windows 2050 will now be available to customers who wish to pay cash money instead of exchanging whole organs, human embryos or brain tissue to obtain a license.
Bill Gates has been quoted as saying "It was unfortunate that we were forced by the government to stop innovating new ways to increase our power, er,,, our product's quality. This measure is temporary, when the our current crop of congressmen are knocking on death's door, I'm sure that our stem cell research will provide us with a few bargaining chips to get laws passed that we agree with."
"Hi. This is my friend, Jack Shit, and you don't know him." - Lord Kano
From the corporate press release:
The transaction is expected to be substantially accretive to HP's pro forma earnings per share in the first full year of combined operations based on achieving planned cost synergies. Cost synergies of approximately $2.0 billion are expected in fiscal 2003, the first full year of combined operations. Fully realized synergies are expected to reach a run rate of aproximately $2.5 billion by mid-fiscal 2004.
Translation:
We're going to start, even before we merge, by getting rid of redundant departments. Expect marketing, legal, human resources, and the usual suspects to be significantly reduced before the merger on one side of the house (can you guess which side is most likely?), and then to be completely shut down afterwards. Reducing the headcount is going to save us a lot of money.
Oh! Did I forget about the Compaq executives who won't play ball that we'll shove out the airlock? Getting rid of those troublemakers will save us some money in the process, thank goodness.
As well, we're going to squeeze some of our vendors just a little bit more to get some deeper discounts off of list price. "We'll give you more volume for a bigger discount. Otherwise, we'll drop you like a rock" is what we'll tell them. That'll give us a bit more money.
And we'll be comparing similar manufacturing plants, engineering departments, etc within the combined company. We'll be pretty fair about this and not just pick everything on the HP side. The most expensive producers will be eliminated. The best cost performers will be rewarded.
We're going to lose some customers and some revenue in the process. Our level of support is going to drop as we lose disenfranchised employees and shift the responsibilities of some of our groups with little or no training. Training really costs too much to invest in. And we're going to have a slight dip in revenue when we dump our unprofitable products. But that is to be expected. We're really riding on the cost savings to make up for it.
It really is too bad we don't have a great deal of time to sort this all out. We're going to be really busy for some time sorting this all out and trying to find the new HP. Hopefully, we won't lose site of ourselves, the market, and the customer (oops! consumer!) and let things slip.
There are a number of things we really haven't thought through, like what we're going to do with our midrange products. Hopefully a middle manager somewhere will come up with a good idea. But we'll probably have to depend on the usual sources -- those industry pundants in the trade rags. After all, they're the ones that gave us the idea of the merger in the first place! They really have their finger on the pulse of our company.
Wow. This is going to be all figured out by the end of 2004. That's not a lot of time! I wonder how things are going to turn out?
I spent a year there (my contract at HP expires in three days), and I've seen the environment.
I'm kind of optimistic about the deal from the companies' point of view. First of all, who is going to suffer:
1) Competing printer makers. For now Compaq was rebranding Lexmark printers, so they are screwed.
2) OpenVMS and HP3000 users. HP is trying to get rid of all old platforms (like HP3000). OpenVMS will probably be put on life support (it was doomed after Compaq could not produce Alphas anyway).
3) Digital UNIX users. I think HP will try to move them to much more widespread HP-UX (many of the vendor packages are released for Solaris and Linux first, HP-UX second, and AIX third. TRU64X and Irix are distant fourth, and many don't even port there). I'd guess that they might even release an emulator of the system calls to just recompile programs on HP-UX scaling down Alpha products.
4) Stratus Computers (www.stratus.com). This competitor of Tandem uses HP processors and OS now, and they are going to get a competition from HP.
5) Employees.
Do you know that these corporate behemoths do not build their stuff? I've recently seen an inside auction where the last HP inkjet made in the US by HP was auctioned. All of the printers and PCs are now built by subcontractors (such as OMNI, Solectron, et al). Consolidation of the products will allow to reduce the design, development and testing staff. Also reduced will be support (eventually, after consolidating the products).
OTOH, the deal will help HP get through the hard time of the market slowdown by sharply increasing their inkjet's market share (using Compaq's strength in retail). Expect Lexmark's shares to fall.
Second, it will give them the reliable computing in Tandem. I don't know if Tandem computers were shifted from MIPS to Alpha, but the next generation of them will definitely use McKinley processors because their customers value reliability over speed and cost, and any processor will suffice.
Third, integration will give them GOOD REASON to discontinue older product lines at both Compaq and HP. These are decisions that usually involve a lot of power struggle, but the merger puts a "force major" mode on.
Conclusion: HP is buying itself a market share and sales channel for its PCs, PC servers and printers plus economics of scales. Also it buys itself a chance to do a full scale reorganization.
Finally, HP did not fire CEO. The fucker's name is Rick Beluzzo (doesn't it sound familiar?), and CEO's name was Lew Platt who peacefully retired. Beluzzo was the one pushing M$ into all holes. Later he went to head SGI (hence THEIR NT boxen), and now works where he belongs - in BillG's brothel.
Tigers respect lions, elephants and hippos. Maggots respect no one. (C) S. Dovlatov
It doesn't sound like Linux ... or it is ???
Ciao
----
FB
Not that I really care, I think Lexmarks are crap compared to my HP anyways, but it is a potential point for minor fallout between IBM and HP.
Want to read a great comment about Compaq and HP? See the comment by denshi below.
This comment makes sense to me. It fits with my understanding. HP and Compaq are confused.
Didn't Carly Fiorino leave Lucent in a bad state? Maybe buying Compaq is just an expression of a need for domination, and not something that is good for the company.
Bush's education improvements were
This turbulence in the computer market is making it very difficult to know what companies you can trust, what companies you can't trust, and what kind of computer you really need. Custom-building is an option that becomes more and more attractive with each passing day: by buying the components you really need and skipping the ones you don't, you can get a faster, more reliable computer for mess less than you'd pay for a pre-build PC, and you'll learn something doing it.
Although PC building has previously been the sole domain of propellerhead geeks, the controversial news and discussion site Adequacy.Org has recently posted an article demystifying the process and explaining the art of PC building in simple, easy-to-understand terms. It'll explain to you the full process of building your very own PC that you can truly call "your own" without drowning you in technical details. I found it very useful when custom-building my PC.
printer sales will go up for hp.. at least in compaq buildings...
And you'll get something better. Compaq and HP are in direct competition to each other. They both sell quite a lot of desktops and laptops and servers. Rather than looking at synergy, you should look at bottom line.
They can fire a bunch of (now) extraneous people, pushing more units per employee. I mean, imagine the entire organizations - service centers, sales representatives, researchers, it staff. They can probably cut quite a few jobs, thus cutting costs.
They could also retrain some of these extra people, and use them elsewhere they might need them.
Basically, I think this could be a good thing for the companies (one less competitor to care about), but possibly a bad thing for us customers (less choice), and definitely a bad thing for quite a few employees (pink slips).
Stop the brainwash
The signs:
1) declining computer sales which leads to
2) computer companies either leaving or merging (such as this big one)
3) game consoles, pda's and other non PC devices are more compelling than PC's
4) killer virus worms that can destroy your hardware and fool everyone you know into clicking on an infected file (as I write this a new magistr variant has been discovered)
---
except for to the stupid stock market, which has nothing to do with the basic economic dynamic of a company
Sadly it's "the stupid stock market" that runs most large US companies, HP included. HP's strengths were always in its technologies, but in the last few years it has become just another dull corporate run by bean-counters. I don't blame Carly for the decline and impending collapse of HP, it just happened at the same time.
The HP Way is still alive, and it still works really well for those companies that practice it - they're a number of little start-ups, populated by ex-HP people. There's not much of HP left inside HP any more.
HP is doomed. Not because they can no longer be as smart as they used to be, nor because being just another balance-sheet-driven box assembler is such a bad thing (someone has to make them). HP's problem is that it's entirely unfitted to being competitive in a hard-nosed business sense, rather than a technological leader. Internal management is feeble, and Carly's changes of the last few years haven't yet changed what needed to be changed. There has been a chage of overall direction, but not the change of internal structure to be able to follow it.
http://tuxedo.org/~esr/jargon/html/entry/dinosaurs -mating.html
Here is the proof:
http://images.slashdot.org/banner/cpaq0010en.gif
Of course, I really don't see any bias on Slashdot's part. Errrr, well... come to think of it, that is kind of unusual. Where is the smart comment at the end of the submitter's quote? Timothy didn't say a word. Anyone else would have slammed HP!
I was researching Carly Fiorina and came across an InformationWeek.com interview with the 'boss', dated Friday, July 20th, 2001. It seems to provide some insight into why HP is buying Compaq. Here is the quote from the article:
Carly:
You made the comment that Compaq is becoming a services company. Look, all Compaq has done so far is follow our strategy by nine months to the letter. Including on [June 25], saying, "You know that IA-64 idea that HP has been on for seven years and co-developed the chip? We think maybe that's a good idea, we're going there."
So, what I see Compaq doing actually is following us and I do not think they have the systems-class capability that we do, nor do they have the experience around rich content, which our planning and imaging business gives us. And more and more of the applications are moving to rich-content kinds of applications.
Well, she's obviously a very intelligent woman coming from the rest of the article(and her COUPLE of BS and MS's), and this seems to explain a few things about her reasoning. So what Compaq is lacking HP will be filling in, to create this giant service-over-network beast which will be the Next Big Thing for the Internet.
"I'll just chip in a bit for RedHat: I actually have that installed on my university machine." - Linus, '95
With IBM's stand on Linux, and HP's new stance on Linux, This can only mean that Linux is about to get a SHITload of support from where it needs it most, @ the OEM...
Now couple that with the new info on Intel and AMD poking their nose around the Linux stands... this can only mean one thing, The Linux Revoloution is on its way!
Viva la Linux!
"Consider how lucky you are that life has been good to you so far. Alternatively, if life hasn't been good to you so far
- PeeCee boxshifter buys innovative company (DEC) and butchers it
- Innovative company buys PeeCee boxshifter, and hopefully butchers it
cHomPaq?
Seriously though, I expect it'll go the way go the Fujitsu - Siemens merger of yesteryear. Their products with start off branded as HP-Compaq and the Compaq will slowly get downplayed and eventually dropped.
UNIX? They're not even circumcised! Savages!
instead, they're issuing ~50% more HP shares.
If HP management assimilates Compaq well, all is well for the stockholders. If they destroy Compaq and the acquisition ends up worthless, the stockholders will have paper worth 1/3 less than it was before the merger.
The prospect of trying to combine a corporation whose roots are in the Bay Area of California with one whose roots are in Texas--how come no one questions these catastrophic mis-marriages of disparate corporate culture? Houston, Texas and Palo Alto, California?! What a joke.
From my experience talking to New England Compaq employees, it's been the Digital culture that took over Compaq, not the other way around. This makes sense when you consider that Digital was far larger in terms of employees.
So then Compaq has a Boston/Route-128 culture, not a Houston one. Still a mismatch of course.
While Alpha isn't much competition to anyone anymore, having Alpha *owned* by HP (rather than selling the IP and transfering engineers to Intel) has to be bad for competition. I'd love to see the regulators step in and force Compaq to sell its stake in Alpha as a pre-requisite to the sale. After all, HP are hardly interested in it (Intel holds all the IP anyway).
Mind you I can't see Intel being happy with Alpha being part-owned by AMD or VIA! So HP may be beholden to Intel to try to kill it anyway. Yes, definitely one for the regulators...
I still want my alpha linux box dammit!
Sig pending!
the story is also covered by cnet http://cnet.com/news/0-1003-201-7046992-0.html?tag =tp_pr
among which are:
1) Co-opt an Intel desktop/server competitor, and buy their marketshare and salesforce in the process; acquire their customers and revenue stream.
2) Buy some intellectual capital, i.e., patents and such, cheap. Compaq was always a high-volume business-market PC vendor (lots of PC desktops and Intel servers). But they bought Digital and Tandem, then didn't know what to do with them. HP might still find some useful IP laying around at Compaq - and know how to use it. Hell, maybe HP's realized that hanging their hat on Itanium/McKinley was um,... unwise and shortsighted, and they're looking to develop the Alpha hardware architecture as a hedge against Intel's fumbling in the 64-bit space. PA-Risc is long in the tooth now.
3) Economies of scale. I put this third because I think it will have the least long-term impact. But it will be the one immediate benefit touted by HP and the market. It'll mean big layoffs and charges though, so I won't be rushing to buy HP shares this morning. Shorting HP might not be a bad idea, today.
For those of you who were not around for it: HP bought Apollo in the early 90s. Apollo had what I stand firm in calling the coolest OS in history (totally network-aware, UNIX-like environment, odd-but-compelling GUI with X support, stable network filesystem, etc). They also marketed the world's first networked workstation (followed quickly by Sun).
When HP bought them, they 86'd all of Apollo's technology (except for the critical RISC tech they wanted in the first place) and as soon as they were allowed to by the terms of the "merger", fired most of the Apollo staff. They even had the gall to go to all of the Apollo customers (who were running an OS that you simply could not beat at the time) and tell them that their "upgrade path" was to transition over to HP/UX (one of the world's most brain-damaged versions of UNIX).
Please, don't assume that HP is going to do anything more sane in buying Compaq. The iPaq will probably suffer and/or be removed. I expect to see the final death-blow to the alpha. All of DEC's old technology will likely be scrapped. HP may have changed, and if they have, more power to them. But, I'll reserve judgement....
but likely not good news for either HP or Compaq.
The Register has no less three stories about it: one with the basic announcement, the second explaining why it's a bad move ("Carly Kisses The Ugly Frog"), the third printing Mikey C's mealy-mouthed, cliche-laden worldwide memo to Compaq staff (and oh-by-the-way, 15,000 of you will lose your jobs). See http://www.theregister.co.uk for all the Register stories (and yes, I'm too lazy to code the HTML links - it's late). Go there and look.
It'll be interesting to see what IBM has to say about this merger internally. That won't be up for a couple of hours, though (first, decide what to say...).
its so hard to get a decent fun chip.
Compaq still owns Alpha. Intel has a non-exclusive license and an opportunity to hire people away.
I agree and would go farther and say that there is not such thing as "synergy." The vast majority of mergers do not result in increased shareholder value over the long term (source: recent articles in The Economist but can't remember specific issues or dates).
It's obvious what will happen here. HP will get rid of the stuff that overlaps and struggle to make something out of the remainder. I would be surprised if the HP share price is 20% higher than it was the day before the merger in 3-5 years. They probably think they need to be really large to survive but this deal won't add too much real value
Just as long as "H-C" doesn't screw with Compaq's excellent support structure. During my consultant days, I was once called out to a customer who had a brand-new H-P Netserver with a bad keyboard. I took the bad 'un, gave the customer a loaner and told him I'd have the keyboard replaced right away. It took nearly two MONTHS. Why the delay? Because H-P wouldn't honor the warranty unless/until it was submitted by an engineer who was certified on *that particular server*. Compaq never played that kind of shenanigans.
U.S. Democracy: born 7/4/1776, died 12/12/2000 R.I.P.
Hmm, this is going to be VERY interesting...
Few people I talked to who are working on McKinly processor - says that they can barely make it work at around 1Ghz...
Now - it would be interesting to see Intel's rep talking to PHB, where the PHB sees P4 running at 2Ghz currently vs. McKinly running at 1Ghz...
Would Intel join AMD campaign that "Mhz numbers doesn't matter anymore"? we'll see...
Hetz (Heunique)
I wonder if I'll finally be taken off the Compaq spam-mail lists, or just added to all the HP ones...
They better not start F'in with the iPaq, and their support for linux development for that platform, it's the only reason I bought my damn iPaq.
The register, including a letter from Compaq Chairman & CEO - Michael D. Capellas
http://www.theregister.co.uk/content/7/21444.html
The new york times story4 DEAL.html
http://archives.nytimes.com/2001/09/04/business/0
The press release from Compaq0 2.html
http://www.compaq.com/newsroom/pr/2001/pr20010904
The press release from HPh tm
http://www.hp.com/hpinfo/newsroom/press/04sep01a.
The deals not done yet, mergers and monopolies dicussed at siliconvalley.comt /ml090401.htm
http://www.siliconvalley.com/docs/opinion/techtes
MSNBC
http://www.msnbc.com/news/623619.asp
Wonder what Bruce Perens comments on all this are, come on speak up Bruce! Is this good for Linux?
-- ...
Modrators: i may be karma whoring but that is no reason to moderate this below Score:1. Mod up not down! If only i had meta mod
I Wonder if this means that Compaq is going to get better or if HP will be dragged down
HP/Compaq announces new 2Hz corporate processor
architecture, MBA-RISC.
Instruction Set:
DIVEST
LAYOFF
MERGE
CASHOUT
Built on top of the new architecture, will be HP's new E-business intelligence software solution, codenamed Carly.
Basically, Daimler came in and raped Chrysler, and now, DaimlerChrysler is worth less than Daimler was before the merger.
I expect compaq will become HP's bitch. (Excuse the language.)
On the other hand, this does help consolidate the computer industry further, which might get us out of this recession a little quicker. You never know.
I know one thing: I feel sorry for Dell!
http://homepage.mac.com/jcarusone/iMovieTheater2.h tml
...)
...
This is weird. And scary. (And very addicting
Ballmer's new music video
welcome to Apollo Computers Version 2
but who cares...
Yeah, well, "All restaurants are Taco Bell"!!
I know this is lame, but i'm going to do it anyway:
COMLETT PAQHEW
...And will release products such as:
The Previlion Desktop
The Omnada Notebook
The J-Paq Handheld
Backward%20compatibility%20is%20over-rated
These mergers tend to run in waves - so would it make any sense for Dell to buy Gateway? Or does Gateway suck so bad that they offer NOTHING to Dellor anyone else?
For years we were trying to tell management DECs were good servers. (the bastards kept getting HPs) ... FINALLY :)
:P
DEC was purchased by CompaQ
CompaQ was purchased by HP
We <LI>are in bed with</LI> have a strategic alliance with HP.
Now we can FINALLY get DEC servers
There's pretty huge brand equity in both HP and Compaq names. Anyone know if they plan to keep both?
DaimlerChrysler merger?? All the same things were said about costs reductions and the like, and look where that got them. Let Compaq die!
Some things to think about before making a comparison:
-Automobile manufacturing is hugely capital, labor and material intensive compared to computers, so it is a far from nimble company to make changes in. The auto product is expensive to manufacture - but the difference between low and high end is rather narrow ($15K to $60K) compared to computers ($500 to $1G). Both are highly reliant on engineering, but autos use it more for design concept and execution - the basic premise and technology (i.e. the internal combustion engine) is virtually unchanged. Compare that to computers, which seem to have major changes under the hood almost yearly, not to mention software.
-As for Chrysler, they were already screwed, to pursue your analogy. They have always been overly reliant on inventory, since they never had the manufacturing capacity of either Ford or GM (or Toyota or Honda for that matter). Thus downturns would be ruinous - a circumstance that nearly led them to bankruptcy. Additionally, they never established a global presence - their efforts to establish themselves in European or Asian markets have failed miserably. Chrysler tried to compensate for these shortcomings by hoarding cash, which only made them a takeover target for Kirk Kerkorian and other shareholders; and by designing new products that were flashy and interesting (e.g the PT cruiser - nice look, lousy car).
-As for who got who consider this - Daimler's egomaniacal CEO, Juergen Schrempp saw an opportunity to be king of the mountain - he saw a company that on the surface had some interesting products and was number three in the U.S. The Chrysler team knew that without a global presence and having spent the cash to fend off Kirkorian and company, the company would atrophy over time, and so when Mr. Schrempp strutted into the boardroom, they knew they had a big one on the hook. They got the best terms they could, grabbed their golden parachutes and jumped out of the plane. Twelve months later, as the company bled red ink over Highland Park, Schrempp and a top lieutenant have stepped in, since it's now his ass on the line.
True, the end result may be that Chrysler maybe Daimler's "bitch," but they have been well compensated for the privilege, and not without giving Daimler a nice dose of the clap!!!
...both sell UNIX, and both support GNU/Linux.
;-(
I'm still waiting for decent support for my HP PhotoSmart S20 scanner. Even the Windows scanner program isn't good, although the driver itself works. Linux drivers? I don't think so...
Fiorina holds a bachelor's degree in medieval history and philosophy from Stanford University; a master's degree in business administration from the Robert H. Smith School of Business at the University of Maryland at College Park, Md.; and a master of science degree from MIT's Sloan School. In July 2001, she was named an Honorary Fellow of London Business School. She serves on the board of Cisco Systems and was previously a board member of the Kellogg Company and Merck & Company.
She's not *that* dumb.
Ack! Another Affirmative Action hire!
Of course, (HP + Compaq) < (AOL + TW), but come on...
... and eventually (HP + Compaq) c (AOL + TW). Just give it time. :-)
NOTE: "c" is intended to be subset notation.
"Computer Science is no more about computers than astronomy is about telescopes." - E.W. Dijkstra
Hewlett Paquard.com?
--You will rephrase your request for me to go to hell. Goto statements are not acceptable programming constructs
"When two company's with the same product combine, they often can make more money than if they were seperate"
Yes, that's the synergy theory of mergers. Events since 1970 or so have shown that it rarely happens. Usually, all the best people in the acquired organization leave immediately under their own power, the customers get confused during the transition and stop buying, no one can figure out which staff is 'needed' and which is 'duplicate', arbitrary, unpleasant, and ineffective decisions get made, profitability falls, more layoffs and cuts follow, morale heads south of the Antarctic, and the whole organization sputters and chokes for 3-5 years. If it survives.
sPh
Listen to the merger press release conference NOW at http://www.compaq.com/newsroom/presspaq/090401/ind ex.html!!!!
Don't hesitate, or your iPaq/Jornada will crash.
Good question eh ?
(just leave Linux out of it for a sec and think.)
John
John
I read Apple is going to be the largest Unix vendor in the world, based on units sold, pretty soon. (Mac OS X is a flavor of Unix).
My God, it's Full of Source!
OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
Really who gives a damn?? Compaq and HP computers are junk anyway. Who on Slashdot is actually stupid enough to buy one of them??
I worked on a friends HP last weekend, what a nightmare. HP doesn't even have drivers on their web site for their weird-ass hardware. We tried installing a "real" copy of Winblows 98 on his box, because the junk that came with the computer seriously sucked. But we couldn't find any drivers for the retarted Riptide soundcard/modem combo card.
Now Compaq isn't much better when it comes to hardware. But at least they have drivers on their web site for their systems. So you have to give them points for that one.
So basically I don't see this merger as a problem for me, I build my own systems anyway. So who cares if two bad computer companies become one big horrible company? Not my problem. lol
"Hewpaq Compardlett" from Drunk in Sydney?
Why not the Aussie-flavored "Pomhaq"? Too vicious?
Kill, Tux, kill!
FROM MICHAEL CAPELLAS 4/09/01 - 8:47pm
To: Compaq Global Team
Compaq and Hewlett-Packard announced today that we have signed a definitive agreement to merge our two companies into an $87 billion global technology leader. The combined company will offer the industry's most complete range of IT products and services for businesses and consumers based on open, market-unifying standards and architectures.
I know this comes as a big surprise. In fact, surprise is probably an understatement. But once you understand the strategic logic, the promise and the opportunity of this combination become very clear and very compelling.
This is an historic moment for Compaq, for our customers and for the industry. We have a unique opportunity to build an IT powerhouse with an unrivaled capacity to create customer value. That's what we mean when we talk about our vision - to be the industry's leading IT solutions provider. It's what we mean when we talk about our mission - to deliver superior customer value through innovative products, integrated into solutions and delivered globally. And, it's what we mean when we talk about our commitment to customer success.
Our strategy has not changed. But our ability to deliver on that strategy - to make our aspirations a reality - will be greater than ever in the new company.
By marrying HP's "Invent" with Compaq's "Inspiration Technology" we will build a true innovation machine. We will define the technologies and solutions that transform the business and personal experiences of our customers - from fault tolerant servers at the high end, to powerful UNIX servers in the data center, to industry standard servers delivering content and Web services at the edge of the network. We will drive a new generation of innovative access devices and increasingly intelligent printing and imaging systems. And we will provide the services to plan, design, implement and manage the whole complex.
Behind the merger
The decision to merge was the result of serious discussion and rigorous strategic analysis during the past three months by the Compaq board of directors and the management team. Collectively, this was the only combination we considered because it made complete strategic and cultural sense.
During our talks, it became clear to me and to Carly Fiorina, HP's Chairman and CEO, that our two companies have the perfect blend of complementary strengths. We share a vision of how the market and customer needs are evolving. And, we have a common commitment to deliver integrated solutions, open systems and architecture, and the broadest portfolio of products and services.
The new company will have No. 1 worldwide positions in servers, access devices and printing and imaging, as well as leading positions in IT services, storage and management software. We will have leadership across the key IT markets - enterprise, small and medium business and consumers. And, thanks to the strong teams on both sides, we will have a deep and experienced management team.
But this is about more than product and service strengths. It is also about the complementary strengths of our cultures - a common commitment to:
Invention and innovation
Community service and corporate responsibility
Trust, respect, integrity and opportunity for employees
Customer success, and
Shareholder value
On every important score - customers, partners, shareholders and employees - this is a compelling combination that will create greater value and new opportunities for growth.
Innovation and engineering
I am particularly excited about our shared commitment to technology innovation and engineering excellence and what that means for our future together.
Hewlett-Packard was started by two inventive engineers in a now-famous (and still-standing) garage in Palo Alto, California in 1939. Compaq was born in a House of Pies restaurant in Houston in 1982, where a group of inspired engineers designed the company's first product on a placemat. In the ensuing years, we established ourselves as two of the most innovative companies in the industry.
Sometime in the first half of 2002 - pending the approval of government regulators and shareholders - we will become one company with the opportunity to change the competitive landscape in our industry.
Merger agreement
Under the terms of the agreement, Compaq shareholders will receive 0.6325 shares of newly issued HP shares for each share they own. The merger is valued at approximately $25 billion.
When the merger is completed, the new company will operate under the Hewlett-Packard name. Carly will be Chairman and CEO. I will be President, with responsibility for the company's four operating units: Printing and Imaging, Access Devices, Infrastructure, and Services. The board of directors will be made up of eight HP directors and five Compaq directors.
I have come to know Carly during the past 18 months as we worked together on a number of issues. I respect her leadership skills, her vision and her competitive fire. Like me, she hates to lose. I have every confidence that we will form a great partnership focused on a single objective - the success of the combined company.
I am also very confident that our management team will be well represented in the new company. Carly and I agreed that this depth of management was one of the major strategic elements of this deal.
You can find additional facts about the merger - as well as a copy of the press release and a Q&A - on Inline at http://inline.compaq.com/hr/eecomm/fbt/index.asp .
Integration
Clearly you can expect some changes as a result of this merger. The headquarters of the combined company will be in Palo Alto, California. The company will retain a significant presence in Houston, which will be the key strategic center of engineering excellence and product development for our industry standard server and other Intel-based businesses.
One of the clear advantages of the merger is the financial leverage it provides through consolidation and economies of scale. We expect to be able to realize $2.5 billion in annualized cost savings by mid-2004. This will include approximately 15,000 job reductions, or about 10% of the company's combined work force of more than 145,000. Those reductions will be phased in during the 12 to 24 months after the deal closes through targeted job reductions and attrition. Both companies will be affected.
We already have a comprehensive integration plan and an integration team led by two senior executives: Jeff Clarke, Compaq's CFO, and Webb McKinney, President of HP's Business Customer Organization. Key early decisions - including the top-level members of the new company's management team - have already been made. We believe we have the management talent and focus to balance successfully the complexities of the integration and the demands of our business operations. One of our top priorities is to make the integration as transparent as possible to our customers.
Why merge?
I know that you have a lot of questions. Some we will be able to answer right away and some we won't. But I know that one major question is this one:
We've been making a lot of progress in becoming an enterprise company, so why merge with HP? Why not give us more time to execute our strategy?
We have made significant progress in establishing Compaq as an enterprise company. We get more than 50% of our revenue from our server, storage and services business. Our fastest growing businesses have been industry standard servers, enterprise storage and services. And we're winning major enterprise business across the world.
But we have two significant gaps in our portfolio that make it difficult for us to be truly recognized as a major player in the enterprise. One is a leadership position in data center UNIX. On the plus side, we're competitive in some key segments of the UNIX market. Tru64 UNIX is a technical leader, and we've been gaining market share. But our overall position is not broad enough, particularly in the data center.
HP, on the other hand, is No. 2 in the UNIX market and an acknowledged leader in the data center. Together, we will close the gap with the current market leader, Sun, and create new opportunities to grow our UNIX business.
The second key ingredient we are missing is a leading set of open application integration tools to support interoperability. HP's OpenView software suite is an industry leader for Internet-based system and network management and interoperability. That is a vital part of our ability to integrate solutions across the enterprise.
By merging with HP we are closing those gaps - and HP closes some gaps of its own, including its competitive positions in industry standard servers and commercial PCs.
There's a third important element as well. We will achieve a critical mass in services. Together we will have a $15 billion services business - the third largest in the IT industry. We will have significant strength in customer support, outsourcing, system and network integration, and vertical markets. This will make us an even more competitive solutions company with a unique value proposition for our customers.
But the most powerful combination of all is our people. I am very confident in the talent, engineering excellence and global sales expertise in the combined company. I believe we will have the best management team in the industry, and I can assure you that it will be a team that blends the best of both companies.
I also want to emphasize that until the merger closes early next year, we will continue to compete as vigorously with HP as we do with our other competitors. We have obligations to our customers, partners and shareholders - and to each other - and we need to stay focused on meeting the business and financial goals we have set. As I said before, this includes moving forward with our strategy to extend our world-class technology with a greater focus on services and solutions.
Most important of all, we need to stay close to our customers and partners. We need to meet and exceed their expectations today. And we need to help them understand how this merger will result in even greater value for them in the future.
Conclusion
I know this is not an easy decision for many of you to accept. I have been working through this for the past nine weeks, and I couldn't be more excited about the future of these two great companies. But I understand that you will go through the same range of emotions that I have been through - emotions rooted in our personal identification with this company, its name and its history.
I encourage you to read the material that we have made available on Inline to understand the strategic rationale for this merger. We will continue to communicate on the progress of the merger and answer the many important questions that you have.
I am confident you will see that this is indeed a powerful combination - a combination that builds on our success and on the contributions that Compaq's people have made during the past 19 plus years, and even further back with our Digital and Tandem heritage. It is a combination that will make us stronger . . . that will create new opportunities for business and personal growth . . . and that will define the industry.
I was talking with Ben Rosen the other day, and we were reminiscing about Compaq's founding - how it was built on an open platform that allowed it to compete with IBM - and win - by being better and cheaper. Well, we're going to do it again. The future is in our hands.
Michael
Well, that explains why a review from Epinions ended up on your web site, and then you asked Slashdot to link to it. Except the author of the article decided to view and read it on your site!
Both Compaq and HP have lost ground in the enterprise service space to IBM and Dell (I believe Compaq saw a 26% drop this year in market share in the enterprise market; not sure about HP). So I'm not sure I'd say Compaq has the Intel server market nailed.
Additionally, the PDA market has been generally stagnant. PDAs were a lot like health club memberships for average people. They would buy them to "get organized", but it would generally be nothing but a glorified address book. I think that's why Palm (who has 70% of the market) has been successful in the past (it was a fad to get a PDA because it made you "hip"), but is also having a hard time this year (no one sees a reason to upgrade). Case in point, in my office-- mostly people 32-50 in a large telecom company-- there are plenty of 2 year old Palm V's, but I've only seen one new model (a entry level 105, I think).
So I still don't know what big advantages Compaq is going to bring to HP.
Insert simplistic political, ideological, or personal proselytization here.
I find it funny that these companies can buy up everything like this and get away with it. Now HP will have a strong upper hand in pushing smaller companies out cause both of these brands run most local stores and now it will not be different people in the same store. And to talk about both companies, they make crap computers basicly, they are intended for people that just check email and dont know any better. That just shows you that in a company targets the stupid people they wont get hit for monopoly rights but if someone like Microsoft makes a great product they are punished for targeting people that know what they are doing and making something worth buying unlike Compaq or HP computers.
That is my thought. I could be wrong; gostf
Both companies oppose Microsoft, and don't use Intel chips. Sun has always wanted a place on the desktop. Apple has always wanted their computers to be taken seriously by business. :-)
(Ducks and runs...)
> [That] makes a "Big 3" of Unix vendors: IBM, Sun, HP/Compaq.
True64 is pretty big in business and defense - it wont go away in a hurry.
Major one you missed is HPUX - it is very big in midrange (read multiprocessor) business systems. These used to be 68k based but are now PA based. The IA64 is meant to be binary compatible and plug in replacements to upgrade this huge market. Not sure of the numbers but I wouldn't be surprised if 20% of HP's 47bn revenue is from HPUX related sales.
pithy comment
Yes, but the million dollar question is how fast does this number drop? I used to buy Compaq servers exclusively but will not purchase another Compaq/HP server for at least a few years. I don't know what kind of support to expect, first of all. Second, Compaq has some killer hardware for servers, what is HP going to do with it?
Me, I've started buying IBM for laptops, then desktops, now it looks like IBM for servers too. We may be going back to the days of, "Nobody's ever been fired for buying IBM."
If you look at what Compaq has been doing for the past few months, it is not surprising that something like this was going to happen. Remember about a month ago, Compaq announced that they were going to get out of the PC market and get more into Software services. Now this happens. HP has a rather successful hardware business, but was lacking in its services area. Now it has Compaq to handle the services side. Thus the combined entity can compete with IBM. Now the only thing left would be if MS then bought HP, then you would have software-hardware-services all in one big happy family.
In about 10 years I see (without government mucking around with things):
1)HP-MS-Compaq working on the Windows platform
2)IBM-RedHat doing the Free software thing
3)Intel In bed with both of the above
4)Sun struggling to survive. Eventually dropping Solaris, concentrating on Java, and selling stuff with Linux.
I probably don't know what I'm talking about, but I could see this happening.
I think my productivity just doubled.
How profetic seeing as how the new combined company has ditched the PA-RISC and the alpha in favor of the Itanic.
One more thing, the employees of this new 'thing' are now going to be ultra creative seeing as how upper management is deciding who to ditch.
Also , it brings lots of uncertainty to the customers. Just imagine the joy of the IBM sales people at this when going to a large account
While HP/Compaqard Bell is trying to explain the high price of the Itanic/NT license mess as whores to MS/INTEL , IBM will be selling a stable unified system of mainfraims, servers, desktops, and most importainly STABILITY.
All IBM needs now is a laptop running the powerPC and linux to round out it's line.
* Carthago Delenda Est *
All of these are excellent points! We'll see if HP gets any STDs from Compaq along the way.
--Blue
That Hugo award is going to his head.
For the record, I like HP desktop PCs...when you're in too much of a rush to build one yourself, you can go down to Office Depot and snag a reasonably working HP PC in under 20 minutes.
I hate "out-of-the-box" Compaq desktops, because they have way too much pre-loaded software, and just don't seem solid.
A merger would also give Microsoft and Intel greatly increased control via the combined company. The PC business would be such a large portion of the merged corporation that it would have to dance to the tune of the two existing monopolists. (It's already a struggle to put anything but Windows on an HP or Compaq machine.) In all, the merger would be so bad for consumers that it should not be approved. Of course, with Dubya in the White House, it might happen.... Compaq is a Texas firm and Bush and Cheney are -- ostentatiously -- the puppets of corporations (the bigger the better). But hopefully the light is still on over at the DoJ and FTC....
Well, first of all, note that the government did take an intense interest in the AOL/TW merger, and did in fact force them to make some (limited) concessions for the sake of preserving competition.
And this is the key point: the feds don't (or shouldn't) get involved in mergers like this unless they threaten competition in certain markets. It would be very tough to come down hard on HP/Compaq in this regard because the only market where their merger could have virtually *any* negative impact on competition is the most competitive market on the planet: commodity PC hardware. Indeed, there was some chance that, absent a merger, both companies would have been out of consumer PCs The merger might actually help save a competitor. Seriously, I think the only PC firm that could really draw fire for a merger these days is Dell itself, and they quite frankly do not need to merge with anybody. Coming from the other direction, the only companies HP would have significant anti-trust issues with would be in printing and imaging, and I don't think we're likely to see much of that.
All that being said, I'm not sure that this merger will really end up achieving much. Combined PC sales for the two firms are not likely to be any higher than for the two separate companies, and while they could layoff some more people, I can't see them becoming Dell or anything. It could even hurt some. Barron's a couple of weeks ago pointed out that HP's printer business (especially ink and toner) was the company's cash cow, but one that could potentially bring in even more money if HP *didn't* compete in the PC market (they currently lose a lot of printer sales on bundling deals they don't get because they're a direct competitor in the commodity PC market). HPaq will not be getting out of PCs, so unless they keep or grow their market share, the printer bundling argument starts to become more potent.
Babar
big fish eats small fish.
(We)=small fish.
What is their strategy for merging the iPaq and Jornada lines? The latter would probably be relegated to the low end, methinks. I hope the iPaq stays around long enough for me to save up for one.
HP
What are you smoking? HP's greatest strength is computer technology are those kickass calculators! The HP-48 is the sole reason I passed some of my physics courses! After those, then come the printers.
(Okay, okay, mostly kidding... I agree with you that HP makes better printers and plotters than anybody else out there. My friends and I were just talking the other day how there hasn't been a new calculator from HP lately.)
You cannot apply a technological solution to a sociological problem. (Edwards' Law)
Nah, not yet. Just makes it that much easier for Microsoft to buy 'em later.
Give me my freedom, and I'll take care of my own security, thank you.
According to Compaq Chairman and CEO Michael D. Capellas in an email addressed to Compaq employees early this morning, the name of the new company will be Hewlett-Packard. The headquarters will remain in Palo Alto, California, while the key strategic center of engineering and product development will be centered in Houston.
It's the alpha going to HP that has me intrigued. Intel's new design is heavily of HP origin, and now HP has a competitve processor--with out the albatross of latter-day Digital's marketing . . .
hawk
We've had this conversation before.
Two computer companies merging to compete with IBM. Anyone remember Unisys? They are still around (UIS) but nobody cares.
So the merged company is going compete with IBM and Sun not using Alpha or PA-Risc or any technology that they develop/control but with whatever Intel gives them! Good luck.
Since HP and Compaq have both been trying to develop Linux strategies, the combined company could might try to buy VA Linux. They would become HVAQ and branch out into case cooling for overclockers.
(Not speaking for my employer, or anyone else, of course)
As one of the HP employees who will not be made redundant, I'm glad that the company is going to try to be profitable to save the jobs of the employees that will be left after all of this is over.
Screw your trolling, or your misguided idealism, whatever it may be. Don't think that it's OK to trash the life of the living to spare the dignity of the dead.
"HP buys Compaq" is premature.
HP has put a proposal on the table to buy Compaq. To carry it through, the US and EU antitrust authorities must approve it. This will probably happen in the end, but the authorities may require some divisions to be sold off, and may require other concessions that make the deal less attractive. The stockholders have to approve the final deal as well, though only the large institutional investors have enough stock to have a say.
The story I heard is the other way. Back when C= still existed and David Haynie was working on the new Zorro bus (Zorro 4) he realised that what he was doing was nothing but a PCI-esque architecture. There are stories telling about an A3000+ with AGA gfx and DSP that Haynie built, a prototype. AAA (codenamed Hombre) never saw the light, same as Zorro 4, which would have been replaced by PCI if a new machine had ever seen the light of the day.
Now that is funny! Talk about an analyst having egg all over his face for shooting his mouth off about something that he clearly doesn't know anything about...
Too bad for those of you who have been wishing Compaq would die and just go away.
Compaq shall live an HP eternal existance.
This merger is between two companies that sell into numerous related markets, where there are so many legitimate players in each market. In PC's Dell is #1 and they have 13% share. The "monopoly" created by merging any of the players doesn't limit the choices of personal or enterprise customers in any meaningful way. If HP can pull this off and make money in PC's it will only be better for the tech economy.
Microsoft doesn't have to buy anyone; they're already the huge share leader in every market they're in.
Do you see HP making great strides in the IT world? Do you see them giving away their OS for free (like SUN), or contributing large portions of it to open-source-free-software projects (like IBM and SGI)?
No, the best thing that HP could come up with was hiring Bruce Perens. Close, but no cigar.
To me, it seems like HP is acquiring Compaq to ensure that it maintains a reasonable amount of control over the Itanium architecture, as Alpha technology began rolling in. After all, they've "bet the company" on Itanium, and Intel/Compaq began to assure customers that Alpha and Itanium are one and the same (implying not just SMT integration but support for the Alpha ISA?).
If Carly wants to impress me with her business acumen, she must:
HP and Compaq have no idea how to survive in this marketplace. It will take a great deal more than a smoke-and-mirrors merger to prove otherwise.
http://www.segfault.org/story.phtml?mode=2&id=3b94 fb67-0039f4e0
Suggested course of action, leave the planet.
Just call it the Everything But Shoes Corporation.
My video card's boot message ("3Dfx Interactive Inc.* \ A subsidiary of the AOL-Time Warner-Microsoft-Intel-ABC-NBC-CBS Corporation") will be true one of these days, at the rate we're going.
Well, not to pick too many nits here, but....
ABC is part of the Disney empire, NBC is part of the GE empire and CBS is part of the Viacom empire.
So your message should read "A subsidiary of AOL/Time Warner/Intel/Microsoft/General Motors/Disney/Viacom/Vivendi/General Electric/Bertelsmann/Motorola/Sony/Matsushita/ United States Government, Inc."
Or "H-Paq", perhaps?
y'all realize that alpha *is* dead, don't you? the current processor being developed will be the last. intel bought the entire group that designs the chip, along with all the IP... the artist formerly known as compaq is porting tru64 & VMS to itanium, and that's that.
-disgruntled alpha hardware designer
And even if the margins were so great for "Enterprise" computing, it still doesn't add up. Say you get a thousand million dollar contracts that turn 90% profit. That's just short of one billion dollars.
But if you're selling 100 million PCs at 500 bucks and your only making 10% profit, that's five times as much money.
And you're alot more vulnerable if you lose even one big contract than if you lose 10% of the pc market share.
They also have stated they will buy Atari.
;-)
b 67 -0039f4e0
Oh boy, I cannot wait to have "Adventure" ported to the PC
MB
http://segfault.org/story.phtml?mode=2&id=3b94f
HP-Compaq merger should set off antitrust alarms
By Mike Langberg, Mercury News
Hewlett-Packard should not be allowed to acquire Compaq Computer, not if the concept of antitrust law still has any meaning.
There will be much talk this week about the declining health of the personal computer industry, global strategy in the information services business and the clout of such rivals as IBM and Dell.
None of that matters.
Antitrust law exists to protect ordinary consumers -- you and me -- from actions that would damage competition in the marketplace.
Many of us ordinary consumers buy PCs in retail stores. Compaq and HP together control about two-thirds of PCs sold at retail in the United States.
There is no powerful third competitor, just a few also-rans that include eMachines and Sony.
Dell and Gateway, the other major providers of desktop PCs to consumers, don't offer their products for sale in stores.
To prove my point, I grabbed Sunday's Mercury News from the recycling bin and pulled out the advertising inserts for five national retail chains that are major PC vendors: Best Buy, Circuit City, CompUSA, Office Depot and Staples.
The five inserts carried ads for 25 different desktop PC systems: 11 from HP, eight from Compaq, four from eMachines and two from Sony.
In other words, 76 percent of the advertised desktop PCs came from the company that will perhaps be called Hewlett-ComPaqkard.
There is no amount of public-relations spin that will overcome my gut-level reaction here: Such an extreme level of market concentration can't be good for PC buyers....
Full text at:
http://www.siliconvalley.com/docs/hottopics/hp/ml0 90401.htm
perhaps it might be the right time, but not from that article, where they suggested you buy a Pentium 4 to put in a board which only supports AMD, along with SDRAM...
FROM MICHAEL CAPELLAS 4/09/01 - 8:47pm
To: Compaq Global Team
I have finally found a way to make a boat-load of money in the wake of the Earl Mason coup-de-taut. When I ripped the mantle of CEO from Ekhardt Pfeifer, I had no idea that the executive staff had already implemented my evil schemes to astroturf the company image and cash in before the collapse. Since that card has already been played, my new strategy is to sell you all off for medical experiments and reap a hefty severance.
Please keep in mind that this only benefits me and a few of my hench(wo)men, and the rest of you can sit back and clean up, if there is, in fact, anything to clean up.
Also keep in mind that as I am being massaged by swedish models on the Riviera, I will not once, even for a second, think of any of you struggling to rebuild.
So long, suckers!
Michael Capellas
Super Evil Genius and Earl "Free" Mason Devotee.
"Stop whining!" - Arnold, as Mr. Kimble
Shit + Shit != Gold.
HP is paying $25 billion for Compaq.
How much did Compaq pay for digital back in the days of high stock prices?
ed
Hey, it works for Dell!
(Somebody else has to know this, right?)
OK, everybody can sandbag on both companies for dropping their own processor lines (I lament it too), but let's face some facts here. The primary reason these processor lines went away is because the major software forces neglected them. Let's take Alpha as a perfect example. NT/Win2k totally dropped Alpha support. Now, you'll bitch and moan that there are other OSes, and there are. Tell me this... how much time elapsed between the time the Intel based ISOs of RedHat 7.0 and the time the Alpha version finally showed its lagging ass up? Quite a bit. Compaq/Digital didn't abandon us, we abandoned them. Call a spade a spade.
How many huge corporate mergers are we going to have? Soon we're just going to have one giant corporation controlling everything.
We already do. The company is called Sony (Columbia/Coka Cola/Paramount)
If Apple and Sun were to merge, the new company name would be Snapple.
If Apple and IBM were to merge, the new company name would be IBM.
Why in the living hell didn't Compaq discover that accounting discrepancy in due diligence?
Accoarding to a metagroup article, HP is expected to end their relationship with HDS and swith to Compaq-based solutions for high-end storage solutions.
This is interesting, but HDS is a much bigger player in that market than compaq. Maybe HP/Compaq do intend to become a competitor for IBM/EMC/HDS?
Uri
OS X has a built in assistant and it works pretty much like a mac with freebsd under it.
However, I'm having p-roblems replacing the default page on my new 1.3.19 version of apache.
Maybe I should chuck it and go back to the system's apache, I also need to get OS X to use my cable modem.
- Kaos games and encryption systems developer