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The big losers in the merger could be enterprises reliant on Compaq's legacy operating systems, OpenVMS and Tru64 Unix. "The users of OpenVMS and Tru64 Unix probably really ought to be evaluating their options at this point, because it's not at all clear that HP will want to maintain those products. It will probably boil down to HP-UX, plus Linux," Kusnetzky said.
Tru64 Unix has about 6 percent market share for Unix operating systems, compared with 15 percent for HP-UX. Compaq sold only 25,000 OpenVMS licenses in 2000, Kusnetzky said.
While both Compaq and HP have large services
organizations,
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they specialize in their own
company's products and don't offer expertise in
vertical industries and application integration like
IBM Global Services and EDS, which rank 1 and 2
in services market share.
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The merger would create
the third largest provider of IT services, according to Gartner Dataquest, with combined service revenues of $14 billion in 2000, compared with IBM's $33.1 billion and EDS's $19.2 billion.
Even with that additional size, it faces an uphill battle. About 65 percent of Compaq's and HP's combined services revenue in 2000 came from support contracts for their own hardware, compared with just 20 percent for IBM, according to Gartner Dataquest.
"When I'm looking at bringing someone in, I don't have the time or the money to educate them on the whole health care spectrum. I'm looking for health care technology experience," said Bill Boffi, vice president of e-business at BlueCross & BlueShield of Rhode Island and an IBM Global Services customer.
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Analysts said neither HP nor Compaq
offer that level of expertise today.
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It's not easy for a platform vendor to separate its consultants from the product side of its business.
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IBM attempts to do this by tying consultants' compensation to the size of the contracts they land, not to the amount of IBM hardware that goes into those deals, said analyst Tom Rodenhauser of Consulting Information Services. He said this kind of independence is critical if hardware companies are to attract top-flight consultants, who balk at the idea of selling products.
It may take HP five years or more to attract the talent it needs to compete in business services consulting, Rodenhauser said.
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HP-Compaq: A Lot To Prove: Customers ask, What's in it for us? http://update.internetweek.com/cgi-bin4/flo?y=eESc0BdpN70V30Rzw0A8
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