What’s the value of hardware infrastructure in the data center?
That question has resurfaced in light of comments made by Hewlett-Packard CEO Mark Hurd at last week’s Gartner Symposium in Orlando, Florida.
In his remarks, reported by Bob Evans at the InformationWeek website, Hurd attempted to explain why HP is taking the right data-center course while others — principally IBM, though he refrained from enunciating those three letters in his talk — are going astray.
Hurd emphasized the importance of hardware infrastructure in the data center and in the broader enterprise. He clearly believes HP’s role as a vendor of PCs, servers, networking hardware, and storage systems gives it an edge over its rivals.
Unfortunately, he doesn’t articulate that advantage clearly, at least insofar as I could discern from Evans’ coverage of Hurd’s address at the Gartner Symposium.
As near as I can tell, Hurd’s argument for HP’s direct involvement in all facets of enterprise hardware is that it allows HP to command the lowest-possible prices from its supply chain. But that doesn’t seem right, does it?
There must be more to it than that. I can’t believe that a purely tactical, cost-saving consideration is driving HP’s strategy to be the “infrastructure company.” If HP perceives an extensive hardware stack as indispensable to its ultimate success in the enterprise and the data center, the reasoning behind it must be about more than extracting low component prices from the supply chain.
Surely, HP must see strategic value in the hardware itself, though Hurd doesn’t explain how or why it perceives such value.
IBM is taking a different tack — so far, anyway — placing its bests on the value derived from the management and orchestration of software, backed up by professional services. For IBM, hardware is commoditized (PCs) or on its way to commoditization (servers, and at least some networking and storage gear), and the smart play is to emphasize the value it can bring customers through ongoing software-based innovation and savvy integration of the various elements into a coherent overall solution.
We don’t know whether IBM is right, but it has done a relatively good job explaining its position. HP might have similarly good reasons for wanting to be an across-the-board hardware purveyor, but Hurd failed to offer them at the Gartner Symposium.