Compaq Eyes EAI as Part of E-Business Push

Computergram International, July 13, 1999

Compaq Computer Corp is eyeing the enterprise application integration (EAI) market to strengthen its push into internet business services, the focus of a slew of recent announcements. Franc Gentili, segment director of architect and technology integration services at Compaq said there is "a lot cooking" in the EAI sector at the moment and that Compaq wants to be a significant player in the market. However, he refused to be drawn on the possibility of Compaq buying an EAI vendor. Significant shake-ups are expected in the EAI market and if Compaq did choose to buy, it would have a choice of around 25 small companies, many of which are expected to merge or be snapped up by the end of the year. If Compaq bought an EAI vendor it would be to bolster the efforts of its own architecture service labs, which, according to Gentili, are currently working to put together extremely integrated systems for its NonStop eBusiness initiative.

The initiative, according to Gentili, represents the consolidation, of Compaq's previously scattered e-services efforts into a handful of groups worldwide. The company has transferred 7,000 out of 27,000 service staff into an e-business group. The services offered will include consulting, outsourcing, systems integration and infrastructure services and customer support. The firm is also adding 20 preconfigured hardware and software packages to the mix. On the high-end, Gentili said the company would be offering Tandem/Himalaya systems. At the other of the scale, it will be pushing mission critical NT systems. Software offered will include Microsoft Corp, Netscape Communications Corp and Lotus Development Corp kit.

The aim of the Compaq's e-business efforts is to become a serious competitor to IBM, Gentili said. He denied that Compaq was playing catch-up with Big Blue, saying that IBM had not locked down the market and that Compaq was going to play to its own strengths. However, he balked at comparisons with Hewlett-Packard Co, claiming that HP had not been great in terms of providing complete e-business packages to its customers.

However, Compaq itself has had a rough ride of late, with management changes and poor financial results. Robert Naiper is the latest addition to the Compaq management team, joining as chief information officer and senior VP. Gentili admitted that it was a challenge for a large company to be agile enough to compete effectively in the high technology market place. However, he said that the new initiative showed how Compaq was trying to tackle this problem. Overall, the company is planning a 13% reduction in its 69,000 staff but the internet business unit is looking to hire people. The company is pushing to invest in profitable areas of the business, Gentili said, while dramatically reducing or even stopping spending on loss-making sectors.