Cisco beware the HP/3Com China Syndrome

Stuart Corner
Thursday, 12 November 2009 11:50

IT Industry - Deals

HP intends to challenge Cisco in the global networking market by leveraging 3Com subsidiary H3C's dominance of the Chinese networking market and 3Com's existing "China Out" strategy designed to capitalise on its strength in China.

HP has just announced a $US2.7B offer for 3Com  which includes 3Com's Chinese network equipment maker, H3C. In a webcast briefing on the deal, Dave Donatelli - Hewlett-Packard - evp & general manager, enterprise servers and networking, said: "this deal enables HP to become a leader in one of the world's fastest-growing and most strategic IT markets, China, by virtue of 3Com's nearly 30 percent plus share of the China networking marketplace. ...

"You will find that over 300 of the top 500 enterprises in China run their products today...The deal also combines HP's strength from our ProCurve product line on the LAN edge with 3Com's strengths in core switching, routing and security... 3Com also possesses an incredible R&D centre in China. There's over 2400 highly skilled engineers that are going to enable us to continue to fuel innovation and offers a compelling total cost of ownership advantage.

"It enables us to combine their industry-leading products with our global reach of sales, services and distribution in order to bring these products to the entire global marketplace, moving out from just the China market again to the rest of the world."

3Com unveiled its "China Out" strategy in may 2009 as "a new channel authorisation programme for global distribution of H3C enterprise networking portfolio." 3Com president and COO, Ron Sege, said at the time: "The H3C portfolio is the first new entry into the global enterprise networking market in many years and its price/performance innovations set it apart from the rest of the industry."

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