Number 73 (Update of Volume 8, Issue 8)

Analysis: Third parties will become second parties

HP has invoked the words "ecosystem" and "evolution" while describing your future as a 3000 owner, and the creator of your system certainly has the right theme in mind. I'm not so sure that HP has considered all the aspects of a natural change, however. One blind spot that's recently popped up covers the relationship which more 3000 customers have with HP than any other engagement: support. HP's Services arm touches many more 3000 sites than any other part of the giant corporation. HP's evolution in the 3000 market will change that engagement, especially for the many customers who cannot afford to turn off their HP 3000s.

Customers have always had third-party options to buy 3000 hardware, although HP has inserted itself in those transactions during the last four years with an active licensing operation. If you wanted hardware that didn't come off an HP manifest, you still had to include the vendor in the purchase process to get your system licensed. Support, however, works differently. The deliverable is a relationship, something that doesn't need to be licensed. There's a growing number of companies who want to become the second party to your 3000 service relationship, a move that will relegate HP to third party status.

While companies like Blueline Services, Beechglen, Terix and Pivital Solutions talk about supporting HP 3000 sites, HP seems to put off addressing the future that will elevate these companies beyond third party status. We heard this week that HP's future support policy for the systems is still under investigation, because of the complexity of recommending third parties. HP 3000 engineering is still flowing to customers, but its evolution of relationships seems a bit, well, constricted. Talk about how business will change, and you hear a common theme from HP to its 3000 sites, one that sounds like "We're still making up our minds about how we're going to handle this. Stay tuned, and we'll get back to you."

There's a touch of irony in that response from HP -- because it's the very same thing the majority of 3000 customers have been telling the vendor since November of 2001. Back then, HP started the countdown to its end of 3000 business, and the hardest deadline was furthest away: the end of the ability to use HP to solve a problem with the 3000, MPE or IMAGE. We see a lot of companies looking at HP's December 2006 end of support date as the only one they need to plan around, and companies are already planning to change the second party in their support relationships. HP's going to be left behind at some sites, and it will then become a third party.

A third party has to prove its value and promote its relationship harder than a second party. It must respond more quickly to be included in opportunities. Companies which will carry on with their HP 3000s regardless of HP's involvement make up a bigger share of the 3000 community than HP estimated. We're also finding another kind of customer, one who's leaving the 3000 but hasn't yet decided who gets to be their next platform provider. That offers an opportunity to HP that it should pursue. There's a lot of value in being helpful to a customer who's in transition, especially if, like HP, you've induced their transition. We hope that companies who want to assure continued 3000 support can get the respect they deserve from HP, rather than a continued message that a third-party is a less worthy partner. It's HP that's leaving the customers, not the third parties. Third parties are ready to become second parties. How they are assisted by HP during this evolution of the service ecosystem — the most profitable and longest-lasting revenue source in the 3000 market — is something that 3000 customers will remember. HP has a lot to gain by cooperating, especially when its 3000 community orders disks, printers and systems in the future.


Cognos shows off new site for developer support

About two weeks after some customers and Cognos officials examined the future of the development tools group at the company (our last Online Extra carried that story), Cognos showed off its first PowerHouse Web 2.4 application. In a case of leading by example, the company created a developer support site using PHWeb, an effort described by Cognos Solutions Architect Conrad Whittall:

"The Cognos Global Customer Services Web site <http://support.cognos.com>http://support.cognos.com) became host to the world's first PowerHouse Web 2.4 application at just after midnight on [June 6] (Ottawa time). I know, 'cause I was there!

"The application can be found from a link on this page: support.cognos.com/en/support/documentation
...and enables supported customers to browse the entire Cognos product documentation library, then read on-line or download the documents they are interested in.

"There is another part to the application (the biggest part) that only authorized Cognos staff can access, to catalog and cross-reference all of the documentation available on the site.

"I'm hoping that this is just the first of many PHWeb applications that we're able to deploy on this site. Even this one has enough flexibility that we're already looking to extend it to also handle the software downloads and patches that are available to supported customers.

"I was able to design, build, test and deploy this entire application -- including the new Oracle 9i database tables and views -- in only two weeks of part-time effort (hey, I had to keep the rest of the team redesigning the entire support.cognos.com site busy too). The app was initially built on my notebook PC under Windows 2000 Professional, using the new PowerHouse 4GL 8.41C and PowerHouse Web 2.41C. I then transferred the completed code to a Solaris box and recompiled (without any code changes) using PH 8.43C and PHWeb 2.43C -- and this is the environment that the app is deployed in on the support.cognos.com site.

"The documentation for PowerHouse 4GL 8.4 and PowerHouse Web 2.4 will be available through this new application later this week (try Wednesday morning). Documentation for earlier versions is already available.

"My thanks to [Cognos' ADT Product Manager] Bob Deskin for his help explaining the PowerHouse Web enigmas I encountered along the way (I'm sure we'll both get plenty of Supportlink articles out of this), and for ensuring that we were able to get hold of the released product to install at almost the same time as it went to manufacturing."

Cognos customers took a look at the site and noted that a good part of the information requires login and password access, so Cognos users who aren't on support won't be able to tour a lot of the wonders of the site. PowerHouse manuals are still available from the PowerHouse Web site, www.powerhouse.cognos.com The new site "provides additional information for supported customers," according to Deskin.

Server numbers show HP finishes second

HP told analysts at its most recent set of meetings the company is the leading source of servers, but a fresh set of numbers from Gartner shows the market share leader remains IBM. One year after a merger that the company said was designed to create a No. 1 provider, HP is still looking up toward at Big Blue in its windshield, rather than leaving IBM in the rear-view mirror.

According to Gartner's figures HP's server business also declined more steeply than first thought during 2002 -- the year that merger was taking place. Gartner had over-estimated HP's 2001 server revenues, and so when HP sales dropped during 2002, the dip didn't look as sharp as it truly was, Gartner said.

HP's market share dropped by 16 percent, and its Unix server market share fell by 15 percent during the period. The more recent numbers don't look much better in the race between HP and IBM. First quarter 2003 estimates from Gartner show that IBM posted $3.2 billion, or 30 percent, of worldwide server revenue. Estimates for HP show HP coming in second at $2.6 billion, just under a 25 percent market share. Gartner said HP's share declined 7 percent in the latest period. Sun and Dell finished at Numbers 3 and 4 -- but Sun's revenue was declining by 20 percent, while Dell's was growing by 23 percent, a reflection of the power of Linux and Windows over proprietary Unix offerings.


Extra value in Eloquence

While most of the talk about the Eloquence database covers its similarity to IMAGE capabilities, the product from the German firm also carries extra value. Integrated in the software is a version of Business Basic, the language that drove the HP 250 and 260 business servers where Eloquence earned its stripes over the last 12 years.

After Bob Green provided an exhaustive FAQ on Eloquence -- Green's company Eloquence 3000, Inc. is a reseller of the solution and offers support, too -- he commented on the value of the included, integrated language.

"The Business Basic seems like a very good tool," he said, "and it could be used to quickly produce application programs. But it would not be portable to non-Eloquence platforms. So there is a long-term potential cost to pay."


Don't look too hard for that subsys tape

Registered developers in HP's DSPP partner program shouldn't be looking too hard for a subsys tape in the PowerPatch 1 7.5 MPE/iX release. HP made the PowerPatch available to DSPP members at no charge last month, a fact we passed along in our last Online Extra. But Gary Jackson of K-12 app provider QSS said the 7.5 PowerPatch doesn’t include a tape of subsystems:

"This caused me some consternation because I did NOT get a subsys tape with PowerPatch 1. I contacted the ITRC and got the following response:

"I have looked over the description of your problem and there is no separate subsys that comes along with MPE/iX 7.5 PowerPatch 1. There was one on 7.0, but not on 7.5."


Making homesteading work for awhile

In our report on the latest Solutions Symposiums, we mentioned that Anthem, a healthcare provider with operations in Virginia, was making a case for homesteading. Discussions at the OpenMPE meeting in Valley Forge showed that in lieu of a $40 million transition to IBM-based Facets, Anthem would benefit from having a workable 3000 hardware emulator to extend its use of the HP 3000 solution.

We heard from MPE folks on the Anthem team after the article appeared, developers who were glad to know their upper management was investigating a longer lifespan for their 3000. Anthem -- the company was known as Trigon until a recent acquisition -- is typical of the 3000 customer who needs more time to make their transition, and so will be homesteading as long it takes to get the evolution running right:

"We technical associates are trying our "darndest" to homestead, because it will probably be 2008 before they make up their mind about Facets. Of course, management has a different feel for the problem."

Anthem's Dale Kennedy caused quite a buzz in the OpenMPE meeting by reporting that moving away from the 3000 would cost Anthem anywhere from $14 to $42 million -- so the cost of using and helping to fund a 3000 emulator might be cheap in comparison. Then there's the politics involved in getting everything onto Facets from mainframe apps and the 3000. Those are very different kinds of applications, from what Kennedy said, and not easily combined in a single application suite. His comments pointed out that you can't avoid risk in transition, either through a migration or in homesteading.