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Apotheker unfolds new HP roadmap

Posted: 18 Mar 2011 ?? ?Print Version ?Bookmark and Share

Keywords:Leo Apotheker? public cloud service? business analytics software?

Leo Apotheker, newly appointed CEO of Hewlett-Packard, revealed to an attentive audience how he earned the moniker "Polar Bear" from his former SAP family. Meeting the press for the first time, he spoke in tones that ranged from warm to terse to just a tad icy.

Most of the questions revolved around the news HP will roll out its own public cloud service, pre-load WebOS on its PCs side-by-side with Windows, and ship a family of high-end systems that integrate business analytics software from Vertica Systems, a company it is acquiring. Apotheker was bullish on the company's new plans and potential, but tight-lipped on certain topics.

Leo Apotheker

For example, Apotheker said he will shift the focus of his predecessor Mark Hurd on cost cutting to invest more in technology. However he declined to provide numbers.

"R&D is not just measured in dollars, it's about effectiveness as well and the entire R&D processand we need to get a little bit better in that," he said. "What you have seen today with Vertica shows HP has the capability for team workwe can make things happen really quickly, and you will see much more of this in the future," he said.

HP's R&D expendituresnow at about 2.5 percent of saleswill grow faster than sales and be funded based on increases in gross margins, said HP's chief financial officer, who was on hand for the event.

"From an R&D perspective, the messages we have received from Leo have been very positive, and hopeful of a better future," said one senior HP engineer who asked not to be named.

"He certainly has shown that he values the employees of this companya trait that has been absent for the last two CEOs," the engineer added. "He understands that innovation needs to be fostered from within his employee pool, that acquisitions can help you out in the short term, but long-term sustainable growth needs to be fostered from within," he said.

In the press Q&A, Apotheker deflected a question from one reporter about any future changes in the company's management or structure. "This is an event about strategy," he said.

In a Q&A with financial analysts, he defended a significant HP forecast to grow the company's $127 billion revenues about five percent in the coming year. "Even if we just grow by single digits we have to add several billion dollars in revenue, effectively creating a new Fortune 500 company," he said.

Bullish on WebOS and clouds
Apotheker was most bullish about HP's plans for cloud services and its WebOS mobile environment acquired with Palm.

The first HP WebOS devices, a tablet and smartphone announced in February, will ship in June. After that HP will release "wave after wave" of WebOS devices, he said.

At the end of the year, HP will show WebOS running in a browser on PCs. "You will see us put it on Windows PCs starting from that point, and we hope to reach 100 million [WebOS devices] a year," he said.

Another HP executive clarified the company's plan is not to make WebOS a native PC OSat least not in the near term. Rather it is just to let PC users access and run inside a browser their WebOS applications.

Microsoft "remains a great partner," Apotheker added, clearly not wanting to upset one of HP's key suppliers for its PC business.

As for cloud computing, HP is developing a public cloud services offering now as part of a "multipronged, multilevel initiative" that will evolve over time, he said. In this way it will compete with companies such as Amazon Web Services and others who have been offering cloud services for a few years.

"How we will catch up is pretty damn simple," he said. "We have 25,000 enterprise sales people out there [and] we have a lot of demand to provide this service today," he said.

"People want SLAs, security and globally scaled services," Apotheker said. "There aren't many companies who can provide thatand that's the gap we intend to serve," he added.

"HP has already invested quite a lot in the past for our data centers, and they will be the backbonewe just need to make them fit for the purpose of the cloud," he said.


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