Hewlett-Packard is taking a swing at Cisco Systems by acquiring networking equipment maker 3Com for $2.7bn cash. HP said the deal will dramatically expand its Ethernet switching product offerings, add routing technology, and secure itself a major presence in China. In addition, HP will pick up a large research and development …
Rather than choosing a purchase that would truly scare Cisco (i.e. Juniper) or a purchase that would prove really useful (Brocade), HP instead decided to purchase the cheapest option available. At least they're consistent, though no one should get an award for being so consistently cheap.
I wonder whether the combined HP and 3Com will be named Chisco?
Only one Internet phenomenon can possible describe this...You Fail.
I've said it before but Cisco's stranglehold on networking - admittedly one they gained because they have awesome products - isn't in our best interest. All the other great names in networking have fallen by the wayside over the last 10 years or so and it's encouraging to see the once mighty 3COM aligned with HP, hopefully getting them both back in the game in a big way.
Could they find someone more lame and useless? Guess not...
I was made redundant from HP Roseville Networks Division about 11 years ago. Management there were in a panic about what to do, they didn't want to offend Cisco by developing high end router because they resold Cisco kit and they were being squeezed at the low end by 3Com. So they basically gave up and shrank the division. Bye bye to lots of knowledge and a decade later they're buying the hope of market share again.
I can't see this working any better than the purchase of Apollo, still there should be some nice bonuses for those that manage the acquisition.
Bend over 3Com employees
Oh dear, I wonder how many of 3Com's 5,800 employees will still have a job in 6 months? Judging from the old EDS employees experience, not many. Those that do remain will get royally shafted by HP - pay cuts, pay freezes, benefits cuts and on top of that having to deal with lower management yes-men and higher management hypocrites. The only reason why HP continues on this acquisition frenzy is to buy market share, get its foot in customer's doors to enable it to sell its own products - it will cherry pick what products it wants and dump the rest, replacing them with HP products. Little more than asset stripping.
I feel truly sorry for the 3Com worker-bees, the HP slash-and-burn will start soon. My advice would be if you get a sniff at a redundancy package is to take it and run!
@ Captain Save-a-ho
I take it you do not like HP then ?
Its obvious that HP will gut 3coms products for anything good.
So whiles staff are being laid off
in the large numbers to cut costs -operational expanditure (P n L aka messes with shareholder returns). Buying someone = Capital expenditure and thats OK. Except this buy ain't worth it.
More bonus for Hurd
Now Hurd will get more money, many 3Com staff will be sacked and the rest will have pay cuts. But that's fine as Hurd will be even richer.
"Its obvious that HP will gut 3coms products for anything good."
You mean 3Com produce something worth buying ?
HP Kit is nice. 3Com is trailer-trash rubbish.
I'm not sure why HP need to buy 3Com. Unless they were pressured into doing it by the government ?
HP buying 3Com
Is like when Cisco bought Linksys.
HP now have high(er) end kit (HP branded) and low end kit (3Com) so they can compete at all ends of the market.
I work for a provider with many public sector customers. For networking many do go for Cisco, but the smaller ones (schools in particular) can't or won't justify the costs. And although I am a dyed in the wool Cisco fanboy I can see exactly where they are coming from.
Many of these are buying 3Com kit. It is decent enough, it works, the cost is justifiable and most of the network managers cut their teeth on Superstack II switches which are still regarded fondly by most.
Some do buy Linksys for the Cisco tie-in and it is likely that many of these would buy 3Com if they knew a company the size of HP was behind them.
I obviously haven't seen the detailed accounts and internal forecasts but on the face of it this seems a perfectly reasonable buy to me.
Glue them together, they'll be easier to avoid. 5 HP Pavilion laptop failures in 18 months, each just out of warranty. That is a 100% failure rate for our HP laptop purchases. 1 HP network MFP that doesn't work without SNMP enabled and horribly bloated SNMP-based client side drivers installed and also just stops working every now and again with no reported errors. Objects to Vista, still.
6 L3 3com switches that are ok so long as you don't ask them to do any L3 stuff and documentation that contains so many blatant errors and untruths that it should be put up for the Booker prize for literature.
Seriously, why is everything shit?
For 3COM Employees
Start looking for a new job now. You will have from 4 to 6 months (or maybe less since 3Com is a relatively small company) before Mark Hurd and his bandits will finish looking into what they can cut and get rid of, from pay cut to bonuses, to stealth layoffs. If you decide to stay (provided of course that you are not made redundant and your job shipped to China or India) you will expereince chaos, frustration and hell for the foreseeble future. Don't beleive one word of what they say: the HP senior management team doesn't give a damn about the employees and customers as well, they will only pay lip-service, they will tell you one thing today and do the exact opposite thing under your eyes tomorrow, if you question something they will tell you that the business environment has changed and may show you the door because you dare questioning. They only work for Wall St. and to fatten their own multimillion bonuses. They don't have respect and committment for anything else that is not Wall St. or their own bank account. Follow my advise, start looking for something else now and if you are lucky enough to find something interesting in your area take it. Hopefully the economy will improve in the next 6 months.
Gotta be 3cHomP
Paris, because she's up for a laugh
...Is pretty awesome in my opinion. Got a mix of HP ProCurve and Juniper kit running our networks. Juniper do the firewals, core routers and remote access, whilst HP does the switches and some L3 routing between VLAN's.
Solid, open standards compliant and reliable kit. Good interface and not too badly priced.
We moved from 3Com to a HP/Juniper network and haven't looked back. 3Com had an awful interface, only did the basics regardless of what model you brought and isn't super reliable.
HP and/or Juniper over 3Com kit any day,
2500 engineers in China?
Wow - that's a lot of friggin engineers.
My impression of 3com in recent years is that after they became an also-ran in the US market, they basically gutted their US operations and outsourced most engineering and production to China. (To a company famous for copying Cisco IOS and putting it in their products, until Cisco sued them several times.)
Now that Cisco has buried the hatchet and 3com bought out the Huawei/3com joint venture, and since H3C/3com now has a large Chinese marketshare and an indigenous technology platform, as well as a tie-in to low-cost Chinese manufacturing capability, I can see why that appeals to HP.
What's not so clear is how they will integrate the product lines. I've really liked recent Procurve equipment in terms of features, stability, user-interface, cosmetics and value. I hope that won't go out the window in favor of the Huawei/3com-based product.
HP networking R&D be afraid
Hmm, not a good time to be in US or Europe and working in HP's networking products R&D - cos your can guarantee that Hurd will be trying to figure out how to replace you with some from China (cheaper and more obedient!). Or maybe you'll be lucky and he'll follow the plan they used on EDS and just fire most of the new guys from 3Com. As some cynical person said - In the Hurd universe it's cheaper to buy a company that's got the product lines you want, rather than using your own experts to develop them in-house.
It pisses me off though - HP's now making me pay for my business calls and mobile out of my meagre salary because of costs, yet they can find US$2.7Bn to buy 3Com - where's the sense in that...
Ah! I see how this works.
So HP will now introduce some cheap, low end routers, that require expensive packet refill cartridges!
Mine's the one with the $8000/gallon ink in the pocket.
Figures Dont Lie
Fact is HP having been taking chunks out of Cisco Marketshare 15% over last 6 months on core products.
Cisco's problem is that it has its head in the cloud and all there focus is on cloud computing.
They are losing customers in there core business area and are also losing out in there other focus area Consumer. Flip has gone from being a market leader to an almost ran.
Mr Chambers needs to look at Kodak...Once a Market leader, it now has know market!
I work for a large reseller that has a Cisco Silver acreditation in the UK and we have 5 account managers which is stupid and to be honest I just ignore there calls now as i have had enough of discussing the same thing with 5 people
Cisco trully hasn't got a clue when it boils down to it
"Those that do remain will get royally shafted by HP - pay cuts, pay freezes, benefits cuts and on top of that having to deal with lower management yes-men and higher management hypocrites."
Ah, but just think your (and my) suffering allows them buy companies they don't understand so the can run them into the ground before heading off "in search of new challenges".
Sorry, no cost of living increasing in five years, followed by a 5% paycut has made me into yet another less than impressed HP employee. Bastards.
Hi from Canada.