HP Breakup: Will SMB Fall Through the Cracks?

Can Hewlett-Packard go to pieces without dropping or losing track of its small- and midsize business (SMB) customers along the way? That's the top question on my mind as the company prepares to split into two: HP Enterprise (for corporate customers) and HP Inc. (PCs and printers).

HP has thousands of SMB customers -- many of whom work with so-called HP channel partners (check a site I used to work on, The VAR Guy). Those SMB customers often buy PCs and servers as part of a larger bundled IT offering. The potential problem going forward: It looks like HP Enterprise will control the server business, while HP Inc. will be limited to desktop and mobile systems, and printers. (I'm double-checking that.)

That's potentially troubling, considering customers and partners can work with Dell or Lenovo to purchase an entire desktop, mobile and server fleet from one company. (Surely, HP will figure out some sort of server/desktop relationship between the HP Enterprise and HP Inc., right?)

Perhaps, but the messaging isn't clear yet. According to the official HP statement:

  • Hewlett-Packard Enterprise will build upon HP’s leading position in servers, storage, networking, converged systems, services and software as well as its OpenStack Helion cloud platform. Meg Whitman will be president and CEO.
  • HP Inc. will be the leading personal systems and printing company with a strong roadmap into the most exciting new technologies like 3D printing and new computing experiences.  Dion Weisler to be president and CEO.

Re-read those two bullets, and HP is leading from behind:

  • The OpenStack Helion platform mention strives to position HP is a cloud leader. In reality, HP's public cloud has largely trailed rival efforts like Microsoft Azure, Amazon Web Services and even IBM's SoftLayer buyout. I had been hoping that HP would acquire Rackspace (I'm a shareholder in the latter) to accelerate its cloud play.
  • HP Inc.'s 3D printing mention also is a stretch. As ZDnet pointed out in August 2014, HP is way-late to the 3D printing market.

All that said, I do respect current HP CEO Meg Whitman. Over the past two-plus years she has stabilized a business that was nearing a cliff. Multiple CEO changes, the botched Autonomy acquisition and previous company breakup debates nearly destroyed HP. 

Whitman and her lieutenants gradually restored trust in the core HP business. Much of the progress involved face to face meeting with customers and partners. 

Still, HP continues to face challenges across its business:

  • The enterprise operation, despite converged storage, server and networking gear, must deal with accelerating cloud competition.
  • The PC and printer operation must deal with the usual falling margins, and an energized Lenovo.

Amid all those challenges, I fear that small business owners and the IT support teams could get lost in the shuffle. After all, SMB is neither an enterprise nor consumer market. It's a market all to its own.

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