Vendor Ratings: Hewlett-Packard Company

Overall Rating: Caution as of 1 July 2003

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Initiative	Rating	Status
Corporate Viability

Sales and Marketing	Promising

Products and Technology

Technology	Promising

Printers	Positive

Scanners & Cameras	Promising

Personal Systems

- PCs	Caution

- Notebooks and Workstations	Promising

- Handheld	Strong Positive

Servers

- RISC-to-IPF Upgrade	Promising

- HPe 3000	Strong Negative

- UNIX Strategy	Positive

- NonStop Himalaya Servers	Caution

- OpenVMS-Based Servers	Caution

- Tru64 Servers	Strong Negative

- Intel/Windows-Based Servers	Positive

Linux Efforts	Promising

Storage Products & Services	Positive

Software	Caution

- OpenView	Positive

- NetAction	Caution

Relationship With Microsoft and Other Key Partners	Strong Positive

Customer Service/Product Support

Outsourcing Services	Promising

Customer Service/Support	Positive






Company Profile: HP Services' Strategy Moves Forward 9 April 2003 Eric Rocco Michael Haines The new HP (post Compaq acquisition) ranks as the third-largest provider of IT services, based on annual services revenue. HP Services is poised to become the cornerstone of HP's overall business. Worldwide Server Market Trends, 4Q02 4 April 2003 Joseph Gonzalez Shahin Naftchi-Ardebili Jeffrey Hewitt The worldwide server market has grown sequentially in units and revenue for the second quarter in a row. But continued economic pressure means that dramatic growth in the first half of 2003 is doubtful. Management Update: How HP Reinvented Product Development 19 March 2003 Matt Light Gartner presents a case study on how the Hewlett-Packard (HP) Imaging and Printing Group has standardized its tools, processes, procedures and program management to transform its product development process. HP's complex global organization made this a major effort. Hewlett-Packard StorageWorks LTO Ultrium Tape Drives 19 March 2003 April Adams Hewlett-Packard was first to market with its second-generation Linear Tape-Open Ultrium 460 tape drive, but quickly lost its data transfer rate advantage when IBM launched its 3580 Ultrium 2 drive in January 2003. HP's Latest Inkjet Printers Raise the Standard Against New Rivals 10 March 2003 Ken Weilerstein David Haueter Hewlett-Packard's (HP's) newest desktop inkjet printers offer multiple functions yet cost just a few hundred dollars. Small-office and home-office users will benefit, but potential new challengers must meet a very high standard. Hewlett-Packard Color LaserJet Printers 5 March 2003 Ken Weilerstein Hewlett-Packard's new faster and more reliable Color LaserJets have piqued the interest of many corporate buyers, but HP must continue enhancing its product line to maintain market dominance and outshine its rivals. Dell/Lexmark Deal Could Eventually Threaten HP 26 September 2002 Ken Weilerstein Peter Grant James Lundy Dell and Lexmark will partner for direct sales of printers. They could erode Hewlett-Packard's (HP's) big printing profits but not until well into 2003 when Dell's level of commitment will become clear. HP Tests the Generic PC Market 10 September 2002 Andy Woo Martin Gilliland Hewlett-Packard (HP) hopes to boost its Australian PC market share by recruiting "white box" vendors to manufacture inexpensive PCs. But HP must offer the right product to the right channels at the right price. Evaluating the New HP for SAP Outsourcing 5 September 2002 Alan Mac Neela Peter Dueck Hewlett-Packard's extensive operations and management skills place it well in the SAP outsourcing market, but problems persist with client transition, partnering and its small-to-midsize business strategy. Hewlett-Packard HP OpenView Network Node Manager 7 August 2002 Sharon Fisher HP OpenView represents a line of management tools providing systems, network, desktop, IT service and Internet management products, with HP OpenView Network Node Manager serving as its best-known member. Challenges and Opportunities for the New HP in Asia/Pacific 18 July 2002 Matthew Boon Hewlett-Packard's merger with Compaq gives the new HP strong market presence in hardware and support services across Asia/Pacific, but it must take steps to ensure growth. Inkjet Printers Can Cost Firms More Than They Realize 2 July 2002 Ken Weilerstein James Lundy Hewlett-Packard's (HP's) new color inkjet printers cost little and produce high-quality images quickly. Many workers want personal printers, but supplies are expensive. Set a careful policy on which workers can have one. No Honeymoon for Hewlett-Packard 13 June 2002 Betsy Burton Anne Powell Martin Reynolds As a result of its merger with Compaq Computer, HP has defined its strategy for the enlarged organization. HP faces one of its biggest challenges as it begins to execute on its global strategy and deliver on its financial promise. The New Hewlett-Packard Emerges 13 June 2002 Brian Gammage After months of doubt and deliberation, Hewlett-Packard's acquisition of Compaq Computer has been approved. The necessary transitions taking place inside HP will change the "face" of the company and the markets in which it operates. HP/Compaq PC After the Merger: What's Next for Customers 10 June 2002 Mark Margevicius Charles Smulders Brian Gammage Leslie Fiering Hewlett-Packard is still a major enterprise PC player, and the Compaq commercial brand remains. HP customers should prepare to migrate. The New HP Services Business: Is Bigger Necessarily Better? 4 June 2002 Eric Rocco The massive integration of Compaq and HP's services business will be unparalleled in scope, but customers should not expect smooth sailing for the entire journey. Hewlett-Packard Defines Its Plans for PCs, Notebooks 9 May 2002 Mark Margevicius Leslie Fiering After acquiring Compaq Computer, Hewlett-Packard (HP) announced plans for all of its PC and notebook products. HP Vectra customers should plan to migrate to Compaq PCs by 3Q02. Hewlett-Packard Strengthens OpenView With Compaq Additions 9 May 2002 Debra Curtis Bill Gassman Hewlett-Packard (HP) will replace three OpenView products with two stronger products from newly acquired Compaq Computer. Enterprises can be confident of HP's commitment to OpenView. HP's Mobile Testing Tools Should Attract Java Developers 29 March 2002 Theresa Lanowitz Hewlett-Packard (HP) has introduced two tools for developing and testing mobile applications based on Java 2 Enterprise Edition (J2EE). Java developers will welcome HP's standards-based approach. Ten Key Consequences of the HP/Compaq Deal 19 March 2002 Paul McGuckin Whether shareholders approve or reject Hewlett-Packard's (HP's) proposed acquisition of Compaq, the deal will profoundly affect enterprises and vendors. Gartner describes its pick of the 10 most important implications. ISS and FTC Give Momentum to HP/Compaq Merger 7 March 2002 Andrew Butler Paul McGuckin Approval by the U.S. Federal Trade Commission (FTC) and Institutional Shareholder Services (ISS) makes it more likely Hewlett-Packard (HP) will buy Compaq. But ISS may not change the minds of some institutional investors. Hewlett-Packard LaserJet 8150 Printers 11 February 2002 Ken Weilerstein We assess how the LaserJet 8150 compares with our workgroup printer expectations and how it compares to the competition. HP and Compaq Bet on Service-Centric Environments 12 September 2001 Tom Austin Michael Glennon Brian Gammage Betsy Burton HP has boldly bet on service-centric environments with its announced acquisition of Compaq. HP is trading off short-term growth in a market with little growth potential to try to corner a more-vibrant, growing, future market. HP/Compaq Acquisition: A Green Light for Process 12 September 2001 Martin Reynolds With any acquisition, there are a number of issues that can derail the process prior to completion. Gartner finds the HP/Compaq deal to be extraordinarily clean, with a low risk of not being completed. Negotiating With HP and Compaq in a Time of Transition 12 September 2001 Mike Chuba Customers negotiating with Hewlett-Packard and Compaq should not stop, but they should be more focused on the terms and conditions of the contracts to provide maximum protection. The New, Bigger HP Needs a New, Bigger Software Strategy 12 September 2001 Yefim Natis Bill Gassman Daryl Plummer Donna Scott HP's acquisition of Compaq merges two companies with weak track records in the software infrastructure market. Will the "new HP" follow the old road, devise a new strategy or let Microsoft drive its software vision? HP/Compaq Acquisition: Changes for the Consumer 12 September 2001 Mark Margevicius A combined HP/Compaq will control a majority of the retail PC space. Dominating the PC market will introduce its own set of challenges.

Lead Analysts Paul McGuckin Martin Reynolds

1 July 2003	Overall Rating: Caution
Donna Scott Debra Curtis Hewlett-Packard has reinforced real-time infrastructure as a key corporate message with its Adaptive Enterprise announcement. The company also incrementally enhanced its Utility Data Center offering during the past year. Real-Time Infrastructure Update 18 June 2003

21 April 2003	Overall Rating: Caution
Cameron Haight Hewlett-Packard (HP) plans aggressive investments to position itself as the dominant vendor in Web services management. Enterprises must carefully monitor HP's progress in subsequent releases for signs of declining investment such as product delays, increasing software quality problems and a lack of responsiveness in customer support. Consider HP for Web Services Management but Watch Its Commitment 6 March 2003 William Maurer Hewlett-Packard's (HP's) $1.5 billion outsourcing deal with the Canadian Imperial Bank of Commerce (CIBC) shows outsourcing remains one of the strongest IT markets. But competition will accelerate through 2003. HP Deal With CIBC Affirms Outsourcing Market's Strength 24 September 2002

19 November 2002	Overall Rating: Caution
Paul McGuckin Hewlett-Packard (HP) President Michael Capellas has resigned. Although the timing of the announcement was abrupt, Capellas' departure will have little impact on HP's near-term or long-term strengths and challenges. Capellas' Departure Won't Change HP's Strengths, Challenges 12 November 2002

29 October 2002	Overall Rating: Caution
Ken Weilerstein Dell and Lexmark will partner for direct sales of printers. They could erode Hewlett-Packard's (HP's) big printing profits but not until well into 2003 when Dell's level of commitment will become clear. Dell/Lexmark Deal Could Eventually Threaten HP 26 September 2002

6 August 2002	Overall Rating: Caution
Josh Krischer An agreement to cross-license certain storage system APIs could lower customers' total cost of ownership. EMC/HP Deals Should Make Central Storage Management Easier 24 July 2002

17 July 2002	Overall Rating: Caution
Andrew Butler The Hewlett-Packard/Compaq merger increases clients' negotiation leverage points. Impact on Enterprise Clients of the HP/Compaq Merger 13 June 2002

14 June 2002

Overall Rating: Caution

Andrew Butler
The speed and clarity of HP's revised road maps and branding strategy enable users to plan their future deployment with improved confidence and less exposure to risk.
Vendor Rating: New HP Platforms and Storage
13 June 2002

Ratings Changes

OpenVMS	up from Strong Negative

Intel/Windows-Based Servers	up from Promising

22 May 2002	Overall Rating: Caution
Leslie Fiering Hewlett-Packard will phase out the Jornada-brand PDA in 4Q02 merging it into the better-selling Compaq Computer iPAQ line. HP Selects iPAQ for PDA Thrust - Jornada Buyers Beware 13 May 2002

16 Apr 2002	Overall Rating: Caution
Massimo Pezzini Hewlett-Packard (HP) could become a major player in Web services, but Netaction is less complete and proven than competing platforms, despite its technical merits. But before making a strategic commitment to it, enterprises should wait until Netaction is complete, mature and assured of strategic support by HP management. The long-term future of Netaction will remain uncertain until the outcome of the proposed merger with Compaq Computer becomes clear. Web Service Offerings Add Substance to HP's Netaction 28 March 2002

28 Mar 2002	Overall Rating: Caution
Betsy Burton The merged HP/Compaq will be complex and multifaceted. HP has promised to deliver a product road map once the merger is finalized. As this road map is unfurled, we will update our research and provide in-depth analysis of HP/Compaq's strategy. Vendor Rating: Merged Hewlett-Packard/Compaq 22 March 2002

22 Mar 2002	Overall Rating: Caution
Andy Butler Despite the potentially positive aspects of this merger, the challenges include: short-term and immense challenges of execution, distractions that threaten sustained focus and market and customer confusion that will surround the rationalization of overlapping and competing product families. In light of these challenges, we rate the new company as a "caution." Vendor Rating: Merged Hewlett-Packard/Compaq 22 March 2002

31 Dec 2001	Overall Rating: Promising
Paul McGuckin Martin Reynolds Recent announcements by the David and Lucile Packard Foundation and by Walter Hewlett place additional doubt on the likelihood of the acquisition being consummated. Gartner remains concerned that senior management of both companies will be seriously distracted by the need to persuade investors to vote for the deal - rather than engaging customers, and improving strategy and execution. The ratings shown here represent Gartner's stalking horse for the combined HP/Compaq entity for 2002, if the acquisition is completed. HP-Compaq Deal Less Likely; Buy Products With Caution 10 December 2001

22 Oct 2001	Overall Rating: Promising
Paul McGuckin Martin Reynolds The benefit of Hewlett-Packard's (HP's) plan to acquire Compaq is not obvious. There's significant overlap between HP's and Compaq's products and services. HP's goal is to trade off short-term growth to try to corner a more-vibrant, growing, future market based on NT systems. To succeed, however, HP/Compaq is faced with the daunting task of reconciling the overlap. Read the presentation below for more details. Download PowerPoint (.ppt) presentation

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