Microsoft, HP Form Joint $300m Marketing Alliance

Calling Hewlett-Packard “the most comprehensive partner we have” among a list of over 640,000 such partners, Microsoft announced this evening, along with HP, the formation of a joint marketing alliance, in which both companies would jointly market unified messaging, collaboration, content management, custom business workflow management, and other Microsoft software implemented on HP hardware.

In a press conference this evening, two HP executives and two Microsoft executives gave a sketchy, sometimes cloudy, outline of a new joint working relationship between the two firms. Their joint activities officially begin tomorrow. Neither side would describe the partnership as exclusive, though each side tended to defer to the other with regard to matters of authority or responsibility – for instance, whose customers are we talking about, and which partner will approach those customers?

BetaNews asked the question directly: Who will approach these customers with solutions, and who will represent the customers’ interests in working to attain them? "Depending on the particular situation, the first contact might come from Microsoft, it might come from HP, it might come from one of our channel partners who see a great opportunity to be associated with this," responded Ann Livermore, HP’s vice president for the Technology Solutions Group.

"That’s the power; we ought to be able to cover almost the whole world, between the partners that Microsoft has, HP has, and our two sales forces. Then whoever finds that lead will bring in the appropriate parties from the other organization, to put together the solution offering. In some cases, it might be a very simple implementation of a server with some software; in other cases, it may be a much more complex solution which requires some consulting or design or implementation services. But the power is that we can come at this from very many different start points."

If the deal centers around any Microsoft software specifically, it’s from the Server & Tools division: specifically Exchange Server 2007 (just released to manufacturing) and Office Communications Server 2007. As HP’s Livermore stated early in the conference, her company is primarily concentrating on features such as unified communication, messaging, and point-of-presence tools featured in the new Exchange, and facilitated through Communications Server.

Livermore also listed "business intelligence services" as a key product for joint marketing. While Microsoft does not yet have a direct presence in that field, partners of that company that do often build such services around SQL Server – again, favoring Server & Tools.

"We have over 20,000 shared customers that we were able to parse today," added Microsoft COO Kevin Martin, "which is an unbelievable number. We think there’s 20,000 more out there that we could extend this opportunity into. So it is literally going to come from all different directions, but having that way of doing business and a way to go to market and a muscle that we will leverage through this ‘People-Ready Business’ initiative, is going to be very strategic for us being able to assimilate all the right resources at the right time, to deliver the right value for customers."

This does not appear to be a way for HP to sell Vista or for Microsoft to sell ProLiant, so much as it’s an acknowledgement on the part of both parties that their customers are not seeking hardware solutions and software solutions separately. Both companies will be investing a total of $300 million (neither would say who contributed how much) toward a three-year venture that markets integrated solutions, by way of what Microsoft’s Martin described as an "integrated partnership with HP."

"The most comprehensive partner that we have, out of the 640,000 partners that we have at Microsoft, is Hewlett-Packard," pronounced Turner. "We interface with them on a variety of dimensions." Later, HP senior vice president for consulting and integration, John W. McCain, acknowledged that representatives from both companies have been working to hammer out this agreement "for several months."

Whether these negotiations were partly responsible for the delay in Windows Vista’s enterprise release to November, from Microsoft’s original target date of August –- as was implied by an article earlier this year in The New York Times -- remains unknown, though not impossible.

When asked whether Novell and SUSE Linux would have a place in the two companies’ joint solutions, Turner appeared to answer in the negative, though not in so few words. "This particular initiative," he said, "is about selling our portfolio and it’s about selling HP’s portfolio...and us being able to bundle those in an integrated way, in a go-to-market way, and in an elegant solution for customers and for CIOs...This is about, how do we extend both of our opportunities and really leverage where the market’s going?"