HP Learns Lesson From Linux

Not to be out done by IBM, Hewlett-Packard is promising to storm the e-commerce arena girded with a new Internet software code-named “Fremont” that can be downloaded for free — the same way the Linux operating system is.

According to analysts, HP executives have said the new software is written in Java, the language written by Sun Microsystems, to run on any computer. It will make a plethora of e-commerce services available to any company downloading it free-of-charge from the Internet. HP is expected to announce all the details of the program and its e-commerce counter attack at a Tuesday news conference.

Industry experts said this is just what the 61-year-old company needs to jump-start it out of its current financial slump. In its fiscal year ended October 31, 1998, HP’s net income fell 5.6 percent to $2.9 billion (US$), while it sales rose a paltry 10 percent to $47 billion. Compare this to 1993 to 1997 when its net income soared an average of 46 percent, and you begin to understand the urgency of its sudden foray into e-commerce.

Analysts caution that the Palo Alto computer maker will have to quickly thrust itself into overdrive if it ever hopes to catch up with IBM and Sun, which have both made deep inroads into online commerce.

Goin’ Mobile

Meanwhile, in a $100 million ad campaign pitched in newspapers, magazines and TV beginning this year, HP said it would soon be offering wireless handheld devices that will allow the man or woman on the street to compare rates on cabs, buses and electronics.

In addition, it’s touted a Web bank site where accountholders can pay their bills, taxes — or trade stocks. Critics of HP contend its pitch is no big deal, since dozens of other companies are already doing, talking about or developing the same kind of e-commerce goodies.

But say what you will, HP still has the money and hardware to partner with such companies as Sunnyvale, California’s Ariba, Inc. The privately held company is building a program that lets corporations buy office equipment from suppliers on the Internet. HP is supplying Ariba with free computers and software for the system in return for an undisclosed percentage of its revenue. HP officials said Ariba is just one of many such deals in the works.

Analysts all agree that HP’s plan definitely sounds good. But some of them wonder whether the company will be able to turn the hype into reality.

What do you think? Let’s talk about it.