HP ditches LAN switches but keeps all UK 3Com staff

18 months pre-planning paved way for successful rationalisation, says newly merged company

HP completed its $2.7bn (£1.8bn) acquisition of network equipment rival 3Com in April

HP's £1.8bn acquisition of 3Com will not result in any job losses in the UK at least, said the company, but it will see the end of certain product lines at the low end of the local area network (LAN) switch portfolio.

HP completed its $2.7bn (£1.8bn) acquisition of network equipment rival 3Com in April, sealing a deal that could have been seen as a union of two bitter enemies committed to the defeat of a mutual foe – Cisco.

HP first began to investigate a proposed 3Com buyout two years ago, having realised that its existing ProCurve networking division had significant gaps in its product portfolio that today's CIOs wanted filling, it said.

"There was never any intention to rationalise, rather to bulk out [current staffing levels]," HP Networking UK & Ireland country manager, Darryl Brick, told Computing. "We want every single [3com] person – everybody has a job and there are no plans to reduce headcount. Indeed, we are recruiting additional people as we speak."

“Some redundancies are inevitable, but at the same time, HP had plans to significantly increase headcount in the combined organisation,” Gartner analyst Mark Fabbi told Computing in May this year. “Anyone with networking experience, both from a technology and marketing perspective, will find a home, but there are always some redundancies in the back office and administration.”

Given 3Com's solid UK customer base, HP is in a race to provide its existing support staff with the necessary skills to cover both 3Com and HP ProCurve LAN, wide area network (WAN), WiFi and security equipment.

"HP services as an entity is having to scale up and skill up to deal with the new segments of technology coming in, like the A-series and E-Series switches and core data centre equipment, and we have a legal team to make sure that contractual and legal obligations are moved across [from existing 3Com customers]," said Brick.

The newly merged networking division, rebranded under the HP Networking, has promised to keep selling and supporting both managed A-series and E-series enterprise LAN switches, differentiating the two on scalability and price, but areas of overlap between its V-series unmanaged switches may not be so lucky.

"There were some overlaps but the research and development division had six months to tinker with the products to see which one broke and then chuck out the other, and that is what they have done," said Brick.

"It is in the area of unmanaged switches that we really have a cross-over point, but our managed switches still have roadmaps and a time to go in terms of end of sale or end of life," said Andy Sawyer, senior technical consultant at HP Networking. "They still get a lifetime warranty, support, plugs and fixes, and replacements."

HP has already buttered up big 3Com customers in the UK, which include the UK police force, to reassure them of its honourable intentions with regards to existing contracts, and support and maintenance agreements.

"We have gone to critical customers to make sure they are comfortable with the transition," said Brick. "I hope they would enjoy the prospect of a better service."

HP Networking is also working hard to keep existing 3Com distributors and resellers, though certification processes are still to be completed.

The new product portfolio will help the company compete on a more even footing with dominant player Cisco, but Brick believes he has also identified weaknesses in a host of other networking vendors that he can now attack, including Brocade/Foundry Networks, Nortel, Extreme Networks, Enterasys and Juniper Networks.