Cisco Systems Inc. remains the king of networking, but Hewlett-Packard Co. is building a small networking empire of its own.
Just ask Monroe County School District in the Florida Keys. The district has rolled out HP ProCurve layer 3 (5300 series) and layer 2 (4100 and 2524 series) switches across its 12 schools and administrative offices. A total of 125 HP switches connect 5,000 desktops, 300 laptops and 65 servers running Windows 2000, 20003 and XP.
"We're planning a large wireless laptop and Tablet PC rollout to all of our students in grades 6 through 12," says Ken St. James, a program specialist at the district. "We're also planning to extend wireless service into the student's homes. The backbone of this plan is our HP ProCurve Gig Ethernet network."
The district had a Cisco network in place but moved to HP's switches based on an open bidding process with multiple networking vendors. "It's been an extremely wise investment," says St. James.
HP's momentum within the switched Ethernet sector is undeniable. The company's year-over-year Ethernet switching revenue grew 50 percent in Q3 of 2003, according to Gartner Inc. That's great news for HP's partners. Roughly 95 percent of HP's networking sales involve solutions providers, integrators and other channel players, according to ProCurve Marketing Operations Manager Pierre Grand. And unlike the server and PC sector, HP has no plans to take more and more of its networking sales direct.
Still, I don't expect HP to compete head-on with Cisco for big enterprise accounts. Cisco has a firm grip on larger businesses and commands nearly 75 percent of the worldwide switched Ethernet market, according to Gartner. In stark contrast, HP holds only about 3 percent of the market, roughly even with 3Com Corp., Foundry Networks Inc. and Nortel Networks Inc.
But keep your eyes and ears open. Over the next few months I expect HP to introduce new channel incentives that may attract 3Com and Enterasys Networks Inc. partners into the HP fold. 3Com and Enterasys (formerly Cabletron Systems Inc.) both have struggled lately amid falling revenue, and are prime targets for aggressive competitors.
Next page: Deal 2--Microsoft CRM Catching On?
Deal 2—Microsoft CRM Catching On?
Several solutions providers tell me that Microsoft CRM is gaining traction among their customers. True believers include Sonoma Partners LLC, a Chicago-based solutions provider, and Tectura Corp. of Tempe, Ariz. Both firms have won Microsoft CRM projects in recent months, with more deals pending. Eileen Stribula, a consultant at Tectura, says Microsoft expects to double last year's CRM customer deployments by June of this year. She expects her company to keep pace with that momentum.
Sonoma, meanwhile, has deployed Microsoft CRM at Equity Residential, a $1.8 billion manager of apartment complexes and condos. The CRM deployment allows Equity Residential to track the sales process for 700 condo units. By 2005, the system will likely manage 10,000 condo units across 50 different property units.
Want to hear more? Check out the April 12 edition of eWeek's System Solutions section. In it, I examine the CRM project at Equity Residential.
Next page: Deal 3—Hooked on Software Margins
Deal 3—Hooked on Software Margins
Again and again, I hear from solutions providers that are pushing into the software market. From big integrators like Ciber Inc. to small Web consultants like Ember Media Inc., solutions providers are hooked on juicy software margins.
In addition to designing software for attorneys and court systems, Ciber is working with PeopleSoft to design CRM applications for the higher education market. (See my March 29 Stick Index column). Likewise, Ember Media is pushing beyond basic Web design and multimedia CD-ROMs to potentially offer marketing-related applications.
For a small solutions provider, Ember is well-connected. Former President Bill Clinton appeared in a recent Ember Media CD-ROM project for Historically Black Colleges and Universities (HBCUs). And what about Ember's marketing software? I can't share much yet because I'm a beta tester. But I expect to have some news to share about it in May.
Next page: Deal 4—Mickey, Michael Eisner & Me
Deal 4—Mickey, Michael Eisner & Me
By the time this column reaches the Internet, I'll be kicking back and relaxing at Walt Disney World. Well, not quite. Even during vacation, I have a hard time unplugging. Whether I'm online or in line, I'm making mental notes of the IT systems around me.
Last year, I spotted Apple Newtons at Downtown Disney in Orlando. Restaurants in the area still use the old handhelds to track lunch and dinner reservations. And in Disney parking lots, attendants rode Segway scooters as they directed drivers to the appropriate parking spaces.
For more on how Disney leverages IT in its theme parks and resorts, check out CIO Insight magazine's recent coverage of the Mouse House.
Oops, I've got to run. My monorail awaits.
About Contract Watch: Each week, this column examines customer engagements that are stirring the channel, and the solutions providers behind them. Our goal is to strip away the hype and tell you what's really selling—and what isn't—in today's IT marketplace. Send your tips to my e-mail address below.
Joseph C. Panettieri has covered Silicon Valley since 1992. He is editorial director of the New York Institute of Technology . Write to him at joe_pan5@yahoo.com.
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