HP memory goes online in used market

Branded subsystems qualify for HP support, sold well below list price

Used hardware suppliers are helping HP 3000 sites end the support finger-pointing that can accompany lower-cost memory subsystems, by selling HP branded memory refurbished from 3000s in the used market.

The HP 3000 operating system can’t have too much memory. MPE/iX was designed to use mapped files in operations, so extra RAM always gets put to work to improve performance. But HP’s list price for new memory still runs well above subsystems from suppliers such as Strategic Memory Systems and Newport Digital, so 3000 managers often buy RAM from these third-party firms.

Non-HP memory doesn’t qualify for HP hardware support, however. If a system failure points to memory, any non-HP boards must be pulled before an HP engineer will do a service call on a 3000. A Texas supplier is among several offering the original HP-branded memory subsystems, discounted because they’re not new anymore.

Priority Computers (800.603.7776) is selling these parts from HP 3000s, subsystems that aren’t licensed to a specific copy of MPE/iX. Bruce Schultz said he’s offering memory for Series 9x9 systems, for example, ranging from $300 for a 128Mb board up to $4,600 for a 512Mb subsystem. Prices for 9x7 systems run $785 for a 128Mb upgrade kit, while HP’s 128Mb kit for the 9x8s costs $650, and the 99X Emerald-class memory starts at $2,500 for a 256Mb card.

Schultz said HP will install used HP-brand memory subsystems, and in some cases certify it without a site visit, a service which can add more than $600 to the price. “It depends on your level of friendliness with your CE,” Schultz said. “I saved Blue Cross and Blue Shield of Tennessee over a million dollars last year. That goes right back into their IT budget, so they can spend it on more hardware.”

Like more than a few memory suppliers, Priority has a no-questions-asked return period after the sale. The used components with HP’s brand have a lot of pros, but “I don’t know of any con with this, unless it bothers you that another firm was testing, or using, it for you for some time,” Schultz said.

Schultz said he buys a system “with existing memory in it, or we’ll have customers that do memory upgrades, say from 128Mb boards to 256Mb boards. We take that memory back in on trade.” Priority takes the HP memory in exchange for third-party memory it sells from Newport Digital, its partner for sales of new HP 3000 memory.

Priority isn’t the only company dealing in used HP 3000 memory. In fact, since the HP crackdown on transferring licenses in used 3000 sales, memory has become a predominant item on the price list of hardware brokers, because it doesn’t require a license. Bill Conley of US Computer (425.558.5800) said that prices on used HP 3000 memory with an HP brand can run “about half” of the new component price.

Conley also pointed out that HP memory is the same part number for similar HP 3000 and HP 9000 systems, such as the HP 9000 K-Class and the HP 3000 9x9s.

Firms like US Computer and Priority sometimes factor in the third-party new memory sale to make profit on the used HP equipment. In this plan, the difference in HP’s list price and the third-party list price lets Priority make money while it saves 3000 sites money, Schultz said. He said a customer who wants to install a Newport Digital subsystem at 512Mb could swap out an HP-branded 256Mb subsystem and get a meg-for-meg trade-in credit on the transaction. Schultz said his firm then resells the HP memory to make its money on such an exchange.

Memory prices are expected to rise over the next few months as a result of the damage to fab plants in the Taiwan earthquakes, but Schultz said prices haven’t gone up yet. “There are a lot of 3000 companies out there interested in saving money on memory, and not paying HP’s list price,” he said. “This is just as cheap as third-party memory.”

After the investigation over illegally-licensed HP 3000s this year, Schultz says he’s careful to deal only with systems that can qualify for a license. “We buy and trade from existing clients only,” he said. “That’s the safest and most economical way.”