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HP turns to cloud computing, but can it execute?

The latest updates to HP's cloud options show the tech giant has read the memo on cloud computing but still has to deliver.

To divert customer attention from the executive shuffling and corporate drama of earlier this year, HP released a handful of new cloud products and services for enterprises. What's unclear, however, is whether IT shops will stick with HP through the tough times.

HP’s latest updates are just the tip of the iceberg in terms of transforming its products and services to meet the requirements for cloud computing. In the meantime, the company has thousands of HP shops on its side that are in no rush to overhaul their IT infrastructure.

HP has gotten the memo on cloud computing; at least they didn’t say anything incredibly wrong in this announcement

Carl Brooks, analyst for Tier1 Research

In some cases companies like Maersk Line, the world's largest shipping company, would sooner hand over the department lock, stock and barrel to HP and swallow the cost. Maersk Line will spend an eye-popping $150 million to build a private cloud using HP technology and services. The shipping giant chose HP based on its existing relationship with the vendor. HP has supplied the shipping company with servers, storage, networking equipment and PCs for years.

“Cloud is a relationship sell,” said Gary Mazzaferro, an independent cloud computing adviser. “It's about trust, and companies rarely switch vendors.” HP has decades of history with many customers and they will go with it based on that alone, he said. 

Not everyone is buying this premise. Rick Parker, IT director in the entertainment industry, said HP’s announcements are "cloud buzzwords that will result in overpriced outsourced failures.” He noted that the Maersk Line deal was a classic outsourcing arrangement that has nothing to do with cloud computing. “Until you fix the IT organization and break up the silos, cloud is not going to work,” Parker added.

And analysts say HP’s cloud strategy is a work in progress.

“HP has gotten the memo on cloud computing; at least they didn’t say anything incredibly wrong in this announcement,” said Carl Brooks, analyst for Tier1 Research.

HP has placed a heavy emphasis on partners and service providers, because that’s where the action is right now, Brooks added. Service providers are forging ahead building clouds, while enterprises are in the first phase of a gradual transition.

HP recognizes that, and also recognizes that most enterprise cloud plans probably include a service provider for infrastructure on some level, whether it’s public cloud participation or hosted private clouds.

“The basic economic calculus underlying cloud computing as a whole is that someone else can do infrastructure better than you can, so HP needs to make sure it’s in there on the ground floor with more ‘A game’ than just hardware,” Brooks said.

HP also announced that its Infrastructure as a Service, Enterprise Cloud Services -- Compute, automates the distribution of application workloads across multiple servers to improve application performance. It’s also improved backup-and-restore options and expanded virtual local area network (VLAN) support to let end users segment workloads within a VLAN. 

A new HP proof-of-concept program lets companies try the service before buying. In addition, the company announced its HP Cloud Protection Program, which offers reference architectures and consulting around cloud security.

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