Hewlett-Packard's 10-year alliance with telecommunications equipment maker Alcatel-Lucent gives the technology giant another weapon in its data center competition against Cisco Systems.
It's also another step for HP as it tries to build up its cloud computing capabilities.
HP and Alcatel-Lucent announced their alliance June 18, a move that HP officials say enables customers of both companies to take advantage of the ongoing convergence of IT and telecommunications. HP officials expect that the partnership—once the definitive agreement has been executed—could generate billions of dollars in revenues over those 10 years.
Though neither company offered significant details of the deal, both said they will jointly market their products in a move to help businesses move their telecommunications networks into more converged infrastructures.
HP and Alcatel-Lucent also will offer services around the joint offerings, and Alcatel-Lucent's products in such areas as IP telephony, unified communications, mobility, security and contact centers will be integrated with HP's technology offerings. Those integrated products will be offered via resellers or as services.
"We expect customers will be able to create new business opportunities and greater efficiencies from this alliance," Mark Hurd, HP chairman and CEO, said in a statement. "By combining our deep expertise in IT and communications, HP and Alcatel-Lucent will help customers transform their technology needs into a competitive edge."
One analyst said the alliance was a smart move by HP, which is finding itself in a heated competition with Cisco in the data center, and also needs to catch up to Cisco and IBM in the area of cloud computing.
Cisco, long known for its networking capabilities, made a significant step into the data center when it unveiled its UCS (Unified Computing System), an all-in-one offering that includes Cisco-branded blade servers and networking technology as well as capabilities from such partners as VMware, EMC and Intel.
The move also alienated other partners, in particular HP, which shot back soon afterward with its own all-in-one data center offering, the BladeSystem Matrix.
"Cisco really took the gloves off with HP with the UCS, and that was intended," said James Staten, an analyst with Forrester Research.
The growth of converged data centers and cloud computing is putting a greater premium on networking, and while HP has been investing in its ProCurve networking products for a while, it can't match up with what Cisco has to offer, Staten said.
Teaming up with Alcatel-Lucent expands those networking capabilities, Staten said.
"This [alliance] is much more a hedge against Cisco than a cloud play," he said, though it also will benefit HP in that arena.
HP's networking capabilities primarily lie within the data center, with switches that enable such communications as those between racks of server or between PCs and remote offices. What it didn't have—before the Alcatel-Lucent partnership—were core switches that essentially allow networks to communicate or aggregate networks. Cisco has always had both, and such networks are increasingly important as data centers evolve and cloud computing becomes more popular.
It also means that HP can lessen its reliance on Cisco as a partner, Staten said. Cisco is too big of a player in the networking world for HP to end its partnership following the UCS move, but HP wanted to stem the growth of that partnership, and now can do that to some extent, Staten said.
On the cloud computing side, HP needs to find a way to catch up to what Cisco and IBM can offer. IBM is making a strong play in that arena. In February, IBM created a cloud computing division, and it further expanded on its cloud strategy June 16.
One advantage IBM has in this area is its Global Services unit, which not only offers services to customers but also hosting capabilities. It's not a huge stretch to go from hosting to cloud computing, Staten said.
Right now, HP only has the services. HP needs to build up its offerings, and the Alcatel-Lucent alliance can help it in the networking side. Enterprises are increasingly going to be looking for ways to have not only their own private cloud environments, but also the ability to use public clouds, and to move services between the two. That is going to take significant networking capabilities, he said.
