No comment on local HP restructure

HP has refused to comment on whether a predicted global restructure that may result in retrenchments of 15,000 to 25,000 staff will have ramifications in Australia.

An Australian HP representative told iTnews that the company was unable to make any comment about the potential impact of any restructure in Australia.

HP reportedly is set to unveil a major restructuring that could be announced as soon as next Tuesday. Cindy Shaw, a US-based analyst with Moors & Cabot, wrote recently that a Silicon Valley source told her to expect news of a major layoff by Monday.

In her report, Shaw said HP could fire between 15,000 to 25,000 employees. Over the past few weeks, Wall Street pundits have been expecting headcount reductions in the 5,000 to 15,000 range.

However, Tom LaRocca, vice president of HP's Americas partner group, said all signs he had seen from new HP CEO Mark Hurd were positive for partners.

"He is meeting with the partners, so I think he is developing a good understanding of how we go to market and how the channel works," LaRocca said.

"Beyond that, I have really got no insight into what he's planning or what changes could possibly be taking place. All I can do is go by the fact that the [partner organisation] is growing. You go back to the quarter-over-quarter growth. That is always a good thing."

LaRocca said HP's channel commitment had strengthened in the last few years.

"We want to grow [our channel business]," LaRocca said. "There was confusion probably over what our channel strategy was a long time ago. We have come out and publicly stated we are committed. We want to grow that business. It is a huge portion of our business, and we want to keep on growing the business."

David Dennis, HP's Synnex account manager, said the HP channel commitment was stronger than it had been in many years.

"The first year or so after the merger there was confusion," he said. "For the last couple of years, it has been steadily clarifying. HP is definitely committed to the channel. Look at how many HP folks came to this conference to talk to our customers. I don't think you'd see that if they weren't committed to the channel."

A dozen HP employees were courting Synnex VARs at a US vendor show Thursday night, Dennis said. "Everyone is upbeat and optimistic about how HP is working with the channel right now," he added.

As for changes to the HP agent program which in some cases reduces agent fees, LaRocca said that marked the first time in four years that HP had changed the agent fee structure.

LaRocca said the agent fee change was not a reaction to Dell.

"It was just HP wanting to grow the business, keep the revenue going in the right direction and being able to be competitive on all the deals," he said. "We had kept it in line for four years and felt like competitive pressures are such that we need to take a look at our business controls and make adjustments that we feel are necessary."

LaRocca said no more changes were being investigated for the agent model. HP did not see the agent fees changing the mix of HP agent revenue or distribution revenue, he said.

Synnex CEO Bob Huang said the US-based global distributor had been working very closely with HP. "So far we have not heard anything from Hurd's office that he will change the direction," he said. "If you look at the business, I think he will look at it and say the channel is needed, efficient and lower cost than they can do it."

Jay Tipton, vice president of Technology Specialists, another US HP partner, said which HP employees are laid off would determine how the cutbacks would affect the channel. "If they are trying to sell direct, they will lay off channel folks. If they cut their channel folks, I don't want to be looking to HP as a partner," he said.