Cisco-HP split may not be too painful for customers

20.02.2010
Cisco Systems and Hewlett-Packard probably won't force their mutual customers to take sides after the end of their partnership, though the vendors are deadly serious about competing against one another, analysts said on Friday.

Cisco said Thursday it would not renew its system integrator contract with HP after it expires April 30, which means HP will no longer be a Cisco Certified Channel Partner or Global Service Alliance partner. The company said its relationship with HP had evolved from partnership to competition. As a result, it isn't appropriate for Cisco to continue sharing road map information with HP, among other things, the head of Cisco's channel program said on a .

As a hint of the break to come, HP earlier on Thursday had said it would expand its own reseller contract with QLogic for storage switches, a category of product that HP has resold from Cisco. In addition, there were reports earlier this week that Cisco had halted work on a future product called the Nexus 4001d blade switch, designed to fit into the Dell M1000e blade chassis. (Cisco declined to comment on unannounced products and said Dell remains a reseller of several Cisco products.)

The coming change announced Thursday only formalized a break that had been forming over the past few years, analysts said. In the past, HP has resold many of Cisco's high-end enterprise networking products while Cisco has used HP computing platforms, some as the basis for network appliances. Each focused on its own areas of expertise, and though HP did sell networking gear through its ProCurve division, that business was focused mostly on small and medium-sized businesses.

However, as data centers become larger and more complex, especially with virtualization, the largest IT vendors are trying to circle the wagons around complete sets of products for those facilities. Cisco and HP are among the most active in this trend, along with IBM, Oracle and Dell, according to industry analysts. Cisco shook up the industry nearly a year ago when it introduced the UCS (Unified Computing System) blade server platform, entering a business where it had never competed. That may have set off the conflict.

"When Cisco started selling servers, it was pretty clear HP had started to de-emphasize Cisco's networking equipment," said analyst Steve Schuchart of Current Analysis. "This is the tombstone on the corpse of the relationship."