The move to commoditization occurs incessantly in high tech. Consequently, small and medium businesses now find themselves able to purchase managed Gigabit Ethernet links for the price of a good meal.While many other network equipment suppliers have struggled, Hewlett-Packard Co. has been gaining market share: Dellï¿¼Oro Group puts the company in the number two position with sales increasing by as much as 40%. The company has garnered that position by delivering robust switches at low prices. As additional evidence of that trend, the company added two new switches to its ProCurve product line. The 2510G Series features a 24-port model selling for $1,099 and a 48-port model priced at $1,999.
The switches are designed for small and medium sized businesses that are pushing the boundaries of 100M Ethernet but do not want to pay a lot for 1G Ethernet connections. The devices feature Protected Ports that support segregation and control of network traffic as well as secure network access via 802.1X, Web authentication and MAC authentication methods.
HPï¿¼s success has been ironic. Even though it has raised its profile, the network group has been treated like a stepchild. Upon visiting the companyï¿¼s Web page, one has to poke around before finding the networking groupï¿¼s page. Periodically, there had been speculation that the company would sell off this business unit because it does not mesh with the firmï¿¼s consumer or services focus.
Such talk may increase. In May, HP announced plans to further build up its services organization by acquiring EDS for close to $14 billion. Earlier this month, John McHugh, who had served as vice president and worldwide general manager of HPï¿¼s ProCurve Networking business and been a prime force in its recent success, abruptly left the company. Some theorize that EDSï¿¼ strategic relationship with Cisco was one or the driving factors behind his decision.
ProCurve customers sit in a dubious position. HP has build up a strong product line, but its long term future now seems in doubt. Should customers continue to buy these devices with the hope that the networking group can gain solid footing or should they cast their lot with another supplier whose future is clearer? Good question.
Are you an HP customer? What do you like about the companyï¿¼s products? Are you concerned about its long term future?