HP is acquiring network infrastructure manufacturer 3Com for $2.7 billion. 3Com provides networking, switching, routing and security components.
HP says the acquisition will further its data center strategy “built on the convergence of servers, storage, networking, management, facilities and services.” The acquisition of 3Com also help to expand HP’s Ethernet switching offerings, add routing solutions and significantly strengthen the company’s position in China thanks to 3Com’s strong presence in China. The transaction is expected to close in the first half of 2010.
It seems that HP struck back with a huge acquisition of its own after rival Cisco went on a shopping spree recently. Cisco responded to HP’s acquisition with this statement:
While Cisco has a healthy respect for all of our competitors, acquisitions in our industry only validate the fact that networking is becoming the platform for all forms of communications and IT. As the leader in the networking market, Cisco is very confident in our business strategy, commitment to product innovation and ability to provide strategic business value to our customers in a highly competitive marketplace.
Wow, M&A are in full swing.
Does this threaten Cisco?
Exactly what I was thinking. I’m sure Cisco’s ears are perked.
Great….HP
WOW! Smart move by HP!
NY Times has a more detailed article: http://www.nyti.../12hewlett.html
This will cause Cisco serious pain:
http://www.sram...-acquires-3com/
smart move, hp is a force to be reckoned with.
For the sake of my home town growing up, I hope HP leaves the 3COM jobs in Marlborough.
Glad I bought 3Com stock at 4.69 a couple of months ago. Already up 38% in after hours trading today.
Smart move…
I’m still trying to figure out why everybody call this a smart move.
3com is overpriced on switches, network cards, non-standard, hasn’t been much of a real player in networking for quite a while.
to wage all out war on Cisco, HP has to buy or merge with Juniper.
Buying 3Com just sounded like 3Com’s strategy of dominating the Internet by the fingers method (and look how far that got them).
You seem to be missing the part that 3Com is a dominant player in China.
BFD. margin on switch equipment is crap, and they’ll have to deal with HuaWei on anything profitable.
Finally HP will get the experience to manufacture PCI Ethernet cards from 3com.
*3com* is overpriced? Have you looked at the prices for Cisco equipment recently? 3com is a damn steal compared to that BS, but still great quality. We have a couple of big 3com switches in our network and they perform like champs, never a single problem in over 2 years.
However, I still think this was a bad acquisition for 3com’s customers. HP isn’t exactly know for high quality equipment. I expect costs to be cut dramatically and quality to drop for all 3com equipment within a year or two.
What percentage of Palm is still owned by 3com?
This could be a smart move. HP doesn’t really have many routers in the mix. Also, Tipping Point is used heavily by the defense industry. But it’s a tricky combination and they still don’t have any firewall products.
Juniper is awesome, but I’d like them to stay separate, if possible.
I wonder if CheckPoint or other firewall product is for sale?
Palo Alto Networks could be one possibility as a very smart FW.
HP looking for UCS killer.
HP and Cisco compete. It will only intensify.
I buy the data center strategy, but why not focus acquisitions on software and services as opposed to hardware?
I think this will create a networking product powerhouse.
Seems like the B word gets thrown around every day with mergers and acquisition. Just another stop in the path toward having Acme, Inc., the company that builds your products and services your needs, all of them.
If you’re hoping they’ll keep the jobs in MA, you’re wishing for winning the lottery. Every decent paying job at 3com will get moved to China or Malaysia, except of course Hurd’s cronies who will be made the management.
The move really makes sense for HP businesswise, though. The truly weak spots in HP’s product lines are security suites and routing.
With the recent popularity of the Tipping Point suite, and the H3C line of routers ( which don’t say 3com anywhere but the back label) they can replace their entire corporate infrastructure that’s currently based on Cisco solutions. That should give them a huge sales volume, even if it is only internal use. Plus 3Com has a very nice healthcare suite aimed at Providers, which I’m sure that HP will leverage into their existing dominance of the US healthcare market.
Great move for HP, but it’s going to suck for 3com employees. Well maybe not the CEO, whom I sure has a “change of control” clause in his contract.
3com products are great , but their support sucks.
I hope HP helps with teh Support.
I resent that as I work for the Enterprise Support Team. We try to maintain a 97% satisfaction rate and almost always get that goal. If you have a contract and a Enterprise product you’ll get state side support from the go.
If you had a bad experience, you are in the minority and I would like the opportunity to change that.
Way to go, Mark! What a great move! You are doing what you do best – look at the strategy play, buy them and get rid of the fats … and partly sponsored by the employee’s pay cut exercise too! Brilliant!