HP Floats Cloud Strategy, But Needs to Make It to Fly

What Saugatuck found at this year’s 2011 HP Analyst Strategy Summit in San Francisco was a far more balanced and coordinated message from HP on how it will respond to technology trends such as Cloud IT, Consumerization, and Security. HP managed to provide a balanced vision of what the future holds for the IT industry under a unifying "seamless, secure, context-aware" banner.

Certainly lacking was detail in some areas on how this will be accomplished by and within HP. One example is HP’s strategic intention to build a PaaS offering for enterprises to develop and deliver applications via the Cloud. HP announced that implementation would be in stages (a public storage service by year end 2011, a compute service by 2012 that would then provide the foundational assets for its longer-term goal of a comprehensive PaaS offering). Another example of strategic intent is HP’s goal to heavily invest in the higher margin software market (but not in legacy transaction-orientated software like SAP). Vague? Yes, but we would not expect HP to share a detailed list of targets with over 350 analysts (even though we were under NDA).

We believe that HP “gets it” when it comes to the rapidly changing IT universe and buyer/user demands in a Cloud-oriented world. They also understand that on-premises IT is not going away, and are specifically targeting traditional, Cloud, and hybrid premises-plus-Cloud business and IT opportunities, both via HP’s Enterprises Services and via the company’s hardware and software lines of business. HP clearly articulated its role in being able to provide the hardware, software and services to manage hybrid technologies architectures for clients.

This year presentations on how new Cloud IT technologies impacts current products and services and how they may be used to innovate the HP portfolio were generally well articulated – it “floated” in terms of analyst acceptance. In the upcoming quarters much effort will have to be made to articulate how HP technologies and services will differentiate the company vís-a-vís competitors. HP’s cloud strategy has to “fly”, not just float, and to do this HP must execute in the context of its considerable innovation, services experience and master brand assets.