HP says demand for high-end servers still strong

SAN FRANCISCO: Affected by the weaker economy, customers of Hewlett-Packard

Co. are taking longer to buy high-end Superdome computers though the demand is

still strong, said a senior marketing executive on Monday. Superdome, the new

top-end server that costs $400,000, is H-P’s flagship, but critics have always

questioned its power and popularity.

At the same time, technology producers across the board, and especially at

the high end, have noted that customers were making it more bureaucratically

tougher for employees to buy the new equipment. "There is no doubt that the

economy does have an impact on a product like Superdome," said H-P’s

world wide marketing manager Mark Hudson.

"It slows down the sales cycle. You probably need to give more attention

towards the purchase order," he said, estimating that a typical deal took

an extra quarter to close. That had a ripple effect through the product cycle,

since customers often bought other computers along with a Superdome, which runs

the UNIX operating system, he said.

But Hewlett-Packard had taken some business from new clients, as well as its

installed base, with the new computer and had a strong demand, Hudson said. H-P

has also been more conservative accounting for Superdome purchases, only booking

revenue when a customer accepts the machine rather than when it leaves the

factory.

Before the launch, the Superdome was seen having an order backlog of about

three months. Asked about the current backlog, Hudson said, "It is probably

fairly consistent with that."

(C) Reuters Limited 2001.