HP To Shut Down Its OpenStack Based Public Cloud (fortune.com) 89
An anonymous reader writes: Hewlett-Packard, which has been backing off on ambitious public cloud plans for a year, is now calling it quits, sunsetting HP Helion Public cloud in January 2016. in a buzzword-laden blog post, the company says its building out support for interoperability with Amazon and Microsoft public cloud offerings to provide options for customers who require such functionality. "HP’s decision is the latest milestone in what has been a slow fade for the company’s public cloud ambitions. It has become increasingly clear that there are three, maybe four companies that can support (at scale) the massive shared computing, networking, and storage infrastructure necessary for a public cloud. ... HP will continue pushing its private and hybrid cloud."
More accurate ... (Score:5, Interesting)
HP has been in decline for years.
Quality is down. Innovation is down. A series of seemingly incompetent CEOs. A couple of bad purchases. Some stupid decisions. Some utterly failed products.
Like so many large companies, now they mostly just lurch from one thing to another hoping sooner or later one of them sticks. One gets the distinct impression nobody really has a clue of what they're doing, and even less of a clue about what to do about it.
Welcome to the modern world of tech, where you buy everything in sight, fuck it up, have a bunch of bad management, and then eventually implode as you realize nobody in your organization measures up to the people who got you there.
One wonders how many good companies have been swallowed up and ruined in trying to make huge companies more profitable, only to find out the huge companies have no idea what they're doing.
Over and over again, we see big corporations who really just keep changing CEOs, and utterly failing to understand just how badly they're all screwing up the company.
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It may be in decline but it is still one of the top computer and network equipment manufacturers in the world.
I have also never worked at a large corporation that didn't have some involvement with HP whether it be servers or huge software platforms.
I don't think HP is in any real trouble.
Re:More accurate ... (Score:5, Insightful)
Well, "which HP?" is a good question [thestreet.com].
Splitting up and selling off are not exactly indicators everything is going swimmingly.
As I said, companies grow, companies buy, companies fuck up what they buy, and then realize they no longer have much of an idea what they are anymore.
I think the M+A craze in tech for the last 20 years has been a lot of short term profit seeking, but is overall really bad in the long run. It maximizes executive compensation, but it doesn't actually achieve the outcomes they claim it does.
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Indeed.
I have not been following the split, but it seems like they are breaking off the less profitable "consumer" divisions into their own company.
If that is the case it may not necessarily mark a decline, just a "reorganization".
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As far as I understand it, they're actually breaking out the exceedingly lucrative "consumer" divisions, but I'm not 100% sure.
Which potentially means they've made such a hash out of everything else they couldn't possibly have had any idea of what the hell they've been doing the last decade or so.
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No, this is an attempt to push off the negative growth and low margin consumer business from the big money enterprise stuff. They sent the very profitable printer division with the consumer end because it was really the only way to make that group not immediately get destroyed in the market. Much like with phones nobody but Apple really makes any money in PC's.
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Either way it's a shell game for the investors. The problem of being a publicly traded company in this position is that they have to do things to appease shareholders that are actually pretty dumb.
Case in point here, splitting their enterprise x86 stuff from their PC stuff is mind numbingly stupid as hell. IBM did it and it seriously screwed up their x86 server stuff. You can do a bit better than break even on consumer space, but in the process you have massive negotiating power with component vendors.
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they have to do things to appease shareholders that are actually pretty dumb ... splitting their enterprise x86 stuff from their PC stuff is mind numbingly stupid as hell.
So if they are "appeasing shareholders" their stock price should go up in the short term. But if it "mind numbingly stupid", then their stock price will go down in the long them. So, since you are so much smarter than the market, you should be able to make a fortune shorting their stock today, and cashing in when the share price crashes. When that happens, please come back and post a photo of your new yacht.
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Note that from the perspective of their strategy on the x86 hardware front, I'm bearish. From the perspective of will HP manage to find some other completely distinct strategy to leverage their name to be a business, I'm not so sure. Again, look at IBM. Their x86 server business tanked, but that had little bearing on their aggregate business results (though those are relatively troubled as well). IBM started selling cash register type equipment, and now they have 0 footprint in the market. Predicting t
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Here is an anectdote, but a good example.
Small-ish company, startup culture. Not the kind of startup culture where there is a ping pong table, the kind were we feel we're the underdog in taking away big corporate accounts for a niche product where the big players have basically shut down development for nearly a decade. Needless to say, we were estatic that we could walk in and basically offer a redo product, and that alone gave us advantages.
Eventually we grew the company to a 40 million per year revenue
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Splitting up and selling off can actually be a good thing, much like pruning a tree. If Trend Micro thinks they can do a better job, or get better "synergy" by buying Tipping Point, then it can be a good transaction for everyone involved.
HP ballooned into an unsustainable monster over the last 10 years - either they can shed some business units that never made any sense for HP to be in, or the whole company can go down in flames. If HP can get back to their core businesses and start moving forward again,
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I think what you mean to say is that they need to make Tough Choices [amazon.com] :p
Re:More accurate ... (Score:5, Funny)
HP is an ink company.
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It may be in decline but it is still one of the top computer and network equipment manufacturers in the world.
I have also never worked at a large corporation that didn't have some involvement with HP whether it be servers or huge software platforms.
I don't think HP is in any real trouble.
The fact that HP is large has nothing to do with success. HP's margins are terrible, and all of their initiatives to build out into higher-margin services have failed. It's like owning a big house outright, but being unable to afford the property taxes and being forbidden to even sell the house to recoup the value.
The fact that they're giving up on public cloud is an ENORMOUS deal...they had put an incredible amount of effort and money into this, and did everything they could to ramrod it into any and all
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It's a big thing indeed. The Eucalyptus buy was supposed to be a big thing, but if they're going to sell servers to other cloud companies and compete with them, too, they're screwed. What made more revenue? Servers. Easy choice.
There's a really bad not-invented-here culture that permeates much of what they do. A text book of how to screw up acquisitions ranging from Compaq to Palm ought to be taught in every B-school and engineering school on the planet.
And amazingly, I have respect for some of their stuff.
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They are in decline because the economy is collapsing
Citation needed.
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"The Economy" is going just fine.
Of course, the officially-defined Economy consists of how businesses are doing regardless of whether they're doing useful work and providing people with profitable employment, or just trading back bits and pieces of corporations so that fat cats can collect stock options and golden parachutes.
Middle-class individuals may fee less optimistic, but we got by for millennia without a large middle class, so what do the economists care?
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HP. Downsizing its way to Greatness.
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Slashdot is so weird. Big companies are, for the most part, evil [unless they're run by young, hip, smart guys who promise that they won't be evil]. We must uplift the little guy. And yet when a big company is becoming smaller, we must ridicule them for moving toward our ideals.
I'm not picking on you specifically at all nor ridiculing your particular comment. Honestly, I laughed when I read it. It's a funny slogan and clever. Your comment just made me think of the weird culture here.
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No, we're pretty consistent ... we're just as convinced the companies are evil when they're run by young, hipster douchebags, and we don't believe them when they promise to not be evil.
Long established companies have just managed to grow into lumbering beasts with no clue of what they're doing, but who have repeatedly established their evil. The ones ran by the
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LOL, sure ... did either of us believe it?
There will always be people who say "we look forward to our new era of corporate benevolence" ... and there will always be people on the sideline saying "yeah, right, whatever bullshit lies float your boat".
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Nobody at HP really has a clue of what they're doing. The people who had a clue were either let go or were spun off as Agilent Technologies [wikipedia.org], which inherited HP's instruments and test equipment business. That's where HP's soul went. The company called
Size matters (Score:2)
Large companies are less efficient and innovative than smaller ones. Yet in todays world (and also in much of the past) they can play out their sheer size and gain advantage from that.
Not because of efficiencies of scale, no, those are outweiged easily by overhead and confusion growing like O(exp(company size)).
But by distorting the market, buying smaller companies and stripping/ruining them, and by playing the global finance system, is how todays large corporations manage to stay afloat.
At the cost of nume
HP = Printers (Score:3)
As a brand, HP means nothing more to people anymore than "some company that makes printers."
For it to thrive for the next 20 years, what HP should do is:
1) Get some consumer/business cred (and market share) back by selling "the longest lasting print cartridges"
2) Buy up the 3d printer market and develop a brand that builds on "InkJet" and "LaserJet" like "3DJet"
Re:HP = Printers (Score:5, Interesting)
As a brand, HP means nothing more to people anymore than "some company that makes printers."
Speaking of HP as a brand, I'm sure many here remember when HP meant "the best test equipment money could buy" (except for oscilloscopes, of course.) That sort of reputation for a brand is rare indeed. However, after going into computers, making printers, merging with Compaq, etc., they spun off that business and renamed it "Agilent." Later, Agilent became "Keysight" after they split that into a test equipment business and a medical equipment business, the latter of which retained the Keysight name. But whatever they're calling their test equipment business now, I think they've lost significant brand value, regardless of the value of the products that Keysight actually makes.
Evidently, they thought the "HP" brand in computers - or more likely printers - was so strong that they would retain that for those products at the cost of losing the top brand in the test equipment business - which, of course, is the business that Messrs. Hewlett and Packard originally created.
Today, the PC business is a commodity business that nobody wants to be in anymore for that very reason. I suspect the printer business eventually will be a commodity business, if it isn't already. Of course, brands don't much matter in commodity businesses.
Sayonara, "HP," my old pal - you were a good brand while you lasted...
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>> Of course, brands don't much matter in commodity businesses.
Actually, brands matter a great deal in a commodity business. Think of Coke/Pepsi (making soda), Nike/Adidas (making T-shirts and shoes), etc.
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Looks like we differ in our definitions of what is and isn't a "commodity business." Coke and Pepsi are examples of what I would describe as non-commodity businesses. For example, why would "New Coke" have ever been such a fiasco if the problem was adding "New" onto the name rather than changing the formula (or "formuler", as Mr. Krabbs would say) of a product people were specifically attached to. Likewise, Coke and Pepsi each have their loyal followings due to the fact that they are not the same product
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>> who among us here doesn't just buy the cheapest gas they can find?
Oddly enough, I don't. I buy from who has the
1) most convenient stations (as a commuter I just want to get to work and back) that
2) have the fastest pumps (as a commuter in a place it snows I don't want to stand around) and sometimes
3) look clean enough to have nice restrooms (especially if I'm traveling with my family).
Price of gas? I don't really check...
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But what about buying from:
4) Shell, even though it costs more, because Shell is the brand that sells the very best gasoline.
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You're right that most people consider a variety of factors when buying a commodity product such as gasoline. Brand may even play into that a little - after all, the people who sell gasoline certainly advertise to maintain their brands. But the fact that brand didn't appear in your list illustrates the fact that brand is pretty small among those factors. Commodity business have to differentiate themselves by practical factors such as the ones you list as well as price (for most people.)
In my own case of
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but who among us here doesn't just buy the cheapest gas they can find?
I don't, depending on the vehicle.
My 20-year old Toyota 4Runner will get the cheapest fuel I can find, because it doesn't care about quality fuel at all. My car, however, throws codes and runs like shit unless I give it fuel from a 'national brand' pump. Same octane rating, etc.
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Fully agree w/ this. As a student, I recall the different oscilloscopes we had in the lab - HP, Tektronix and so on, and HP was by far the best. Later on, in computers too, HP used to make great stuff, and when I thought about HP, I'd normally think about PA-RISC.
When HP spun off Agilent & then Keysight, they might as well have spun off the PA-RISC as well, which could have continued in the engineering workstation space, where it held its own against Sun. HP was migrating to Itanic (how did that wo
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Back in the day (1980s, 1990s), their printers were great. Did you know part of their regular product testing was to drop their printers from table height? That's right, they'd take that 70 pound business-class Laserjet printer a
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I worked at HP when they transitioned to cheap printers. At one meeting a manager stood on top of an HP printer while it was printing, and it continued to work... then used this to claim we're making too good a product and should be making cheap consumer shit.
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What was so odd is they ruined some industries that they owned. Like the health care market. Used to be any hospital in the country it was highly likely they had HP - everything! Temperature probes, heart monitors, you name it, it had an HP logo on it. Then they stopped supporting it entirely. Today it's like it never existed. Now it's Siemens mostly. Frequency counter industry - owned that too. Gave it away... and so on, and so on, and so on. "The Filth and Rot Compaq brought into HP instead of firing the
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Interesting.... I think of ProLiant servers or ProCurve network gear when someone says HP.
I totally forgot that they make printers.
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They used HP hardware to build their cloud (Score:3, Informative)
They used HP hardware to build their own cloud because it was cheaper.
Then they found out they needed to buy separate ILOM cards so they could manage their hardware. So much for cheaper.
They spent hundreds of man-hours installing the ILOM cards.
Then they found out they needed to by licenses for the ILOM software. Oh crap, now it's more expensive.
Then the servers went operational and they found out their brand-fucking-new HP servers are actually SLOWER than the years-old Sun Microsystems-built x86 servers they're supposed to replace - because HP used cheap parts like motherboards with no memory bandwidth and complete piece-of-shit commodity disk controllers that shit the bed when trying to move more than 50MB/sec. Oh yeah, the NEW HP servers only have two gigE ports - whereas the OLD Sun servers had FOUR. And if they had used new Oracle-built servers from the old Sun production line, they would have gotten four 10GB network ports on FASTER servers - and had remote management hardware with fully licensed software for LESS money. (And Oracle ain't exactly cheap, so when the final solution from HP is shittier and more expensive than the one from Oracle...)
Then the damn HP hardware started failing right and left. And the cheap-ass fiber-channel HBAs don't work with a damn.
Can you tell I've dealt with HP before?
So it's not surprising the HP can't deal with HP either.
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I used to work for HP and you are not far off. The cost center accounting meant that group A had to pay Group B for the product. Mind you it was only on paper but still there was a markup at each step.
Ill also point out that there data-center services are crap. I pointed out that I could automate a lot of simple tasks that would reduce down time and provide the customer better service. The Director asked if it would reduce ticket counts as each of these items generated tickets. I said "Yes, it should cut th
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"So anything that would reduce the number of tickets is a bad thing"
I had a similar experience at IBM where tickets were really desirable. But so were quick fixes.
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On top of that, it turns out that OpenStack takes a *lot* of work to get up and running and a lot of work to keep it running. Sure, you can type in one command and get a single node Devstack running but going from there to a full working cloud involves large teams of engineers.
Comment removed (Score:5, Interesting)
Re:MBAs + H1Bs = HP (Score:5, Insightful)
"You can't simply crank out an MBA and put that person in charge of a bunch of cheap programmers and expect innovation."
This. It boggles my mind that no one has stood up and said "this is stupid" over the last decades. Having worked in big corporations almost exclusively, I've seen a lot of this:
- Management by spreadsheet, exclusively. (If you can't measure it you can't manage it.)
- MBAs being put in charge of divisions they know nothing about. (A good manager can manage anything.)
- CxOs listening to McKinsey, BCG, Bain, Accenture, Gartner, etc. exclusively. (They're the most expensive so they give the best advice.)
The last one is particularly funny -- I've experienced a lot of white-shoe consulting firm employees coming in and telling veteran execs 20 years their senior what to do. All of these firms' business models are to take newly minted MBAs, fly them to client sites and dazzle executives with sales PowerPoints. As you can imagine, the problem continues until the consulting firm can't extract any more fees for those former students.
Re:MBAs + H1Bs = HP (Score:5, Insightful)
Well, they're in a feedback loop now .. the MBAs are the ones saying you need to bring in MBAs.
Much like how CEO pay climbed to stupid levels because CEOs and their cronies sit on multiple boards and decide how much to pay CEOs, when the sit on multiple boards and decide how much to pay CEOs.
The people making the bad decisions are hiring people just like them to help make the decisions, because thay mostly want like-minded people. Their compensation is separated from their performance, and they only look at the next quarter so they can take their bonuses and run like hell.
Corporations are almost incapable of long-term planning, because they really only give a damn about the next 3-4 months, and ensuring they maximize their own compensation.
My personal opinion, like you having seem it for the last bunch of years, is that C-level management and MBAs are pretty much uniformly fucking up corporations by doing the same stupid stuff over and over again. But by the time anybody realizes these clowns have been promoted, or received their golden parachute.
Other than CEOs, who really believes CEOs are worth anywhere near what they get paid? Oh, of course, the people who aspire to be CEOs so they too can get overpaid.
It's the emperor's new clothes. It's lies and stupidity piled on top of one another.
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Anyone who did stand up and say "this is stupid" was let go. Heck, even William Hewlett stood up and said "this is stupid" but he was retired so he got ignored by the hot shot MBAs.
I don't see why this is surprising. People interpret the world in terms they are familiar with. A techie views it in terms of cool stuff and science and engineering laws, and has little clue about management or marketing or economics
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you are stupid if you consider jobs a marketeer. He was a shrewed guy, a strategist and he knew his shit.
The base for OSX was almost fully in place with the NEXT machine, during a time when Apple could not get an OS with memory protection working.
Jobs knew what was important and he lost no time to hire the folks who could deliver this for his company and product.
An entrepreneur in the best possible fashion. Also an asshole, but an asshole who knew what he did. In other words, a memorable man.
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There's a show, House of Lies, starring Don Cheadle, where it shows a team of management consultants doing their thing.
It's worth watching the first several episodes; just to see the team in action as management consultants. So much truth in there it's painful.
Smart (Score:5, Funny)
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Who needs to catch up? What do you assume that if a company isn't the biggest in their field that they've wasted their efforts? You must be an American.
We get it there, Jamaican Bobsled Team. Consolation ribbons all around. That is how the real business world works of course.
I think it was Adam Smith who wrote, "Ribbons are a kind of return." and "There is nobility in burning available capital just to reach 10th Place."
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A mistake (Score:1)
Conventional wisdom is that a mature industry can only support three big players, with the top dog making most of the profits, but the cloud is more of a utility than an industry. HP should buy Rackspace and use it to help bolster their private cloud pitch - you can migrate data between your own data centers and Rackspace, either for seasonal spike loads or on a batch basis.
Re: A mistake (Score:2)
Most utilities have geographical limitations. Cloud doesn't, so the "three large players" heuristic would still apply.
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It's not HP... (Score:2, Interesting)
I work for a fairly large service provider, we've been trying to be successful at deploying a full public cloud based on OpenStack for a long time now (years). Today, OpenStack is put together by a fairly large amount of private cloud folks. It's a very nice offering if you want to run a private cloud -- even a very large one, but running a public cloud is different. You have to think about multi-tenancy -- scaling in the number of different segregated users using the cloud not just the number of nodes i
It can be both... (Score:2)
A public cloud business, regardless of technical ability and capability, just doesn't align with HP's current goals well. It's a thankless low margin business from the start, which is not the sort of thing for HP to 'fix' what investors perceive as their challenges. It's also a good way to piss off potential clients that end up competing, though that's mitigated by HP's complete inability to get any market share.
As far as openstack goes, I'd say it is afflicted by the curse of getting buzz from businesses
Smart move (Score:2)
(Yes, HP is capable of smart moves. Sometimes.)
It isn't a question of whether HP can pull something like this off - it's whether it makes sense to even try. Amazon AWS and Windows Azure are well entrenched in the public cloud market, and currently locked in a pricing death spiral. Have you looked at how cheap storage is in either of these clouds? I basically built myself an Azure filer with massive amounts of space that does personal backups for a few bucks a month and could do the same with Amazon -- cheap
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Yes, HP's mistake was even trying (and I would extend that to IBM too). I think they are reasonable business endeavors overall, but IBM and HP are in a position to be crucified by shareholders that are spoiled and expecting gigantic margins out of those brands. Investing to try to satisfy those investors through going toe to toe with Amazon, widely known for willing to operate on no to negative margin.
I think Dell and to some extent Lenovo are advantaged here. Dell by being private don't have to answer t
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If they want to dive into a market, they have to be in it for the long run, just as Microsoft is prepared to do. Amazon is leveraging a lot of their existing resources, which helps them; but Microsoft is probably bleeding pretty badly in the short term, and that's OK.
HP keeps doing dumb things, jumping in head first into a market and mismanaging that effort to a bitter, short end. Part of the problem within HP is that while they can easily manufacture that cheap disposable whitebox hardware to set up the re
HP's killing joke (Score:2)
"It’s anything but cloudy in Europe" says the e-mail they just sent out, as HP's executives enjoy a European vacation touting... the "Cloud" the day after they shut down Helion.
Maybe they should have priced Helion's could services competitively and gave it a chance, but right now, the board and CEO don't have a long attention span, nor any long term strategy beyond jacking up the stock prices so they can sell off and make a quick escape.
Anyone know... (Score:2)
what this does to their Moonshot product or is that a dead tech by now?
Who would use HP anyway (Score:3)
The same when I used to see any business that had all IBM desktops. I would just laugh and say, "I wonder what the total cost per machine that is going to come to?" You could be certain that those machines were just part of a giant upsell as soon as some IBM saleman got his foot in the door during a golf game with some executives in the sucker company.
So if anyone is put out by this decision to close this technology it just certifies them as a fool.
Hey let's be an Azure and AWS-Reseller (Score:2)
(1) shut down own public cloud
(2) be a azure+aws reseller
(3) PROFIT!!!
I have no idea how complicated AWS is, but can you honestly provide any value to the customer just managing AWS?
Scott McNeal once compared, x86-retailing to putting "bruises on bananas". These days, it's Rackspace + HP who look they are doing the very same thing in a different market.
Unravaling Carly's legacy (Score:3)
Dumping the Compaq crap. Now they need to dump off EDS as services is dying as well (for many companies, not just HP). They are slowly and quietly putting a knife to services as we speak.
Take a good look. Take a really good look. (Score:1)