ranscript of Hewlett Packard's Merced Decision

HP Background Core Problem Solution Fallout Offerings Activities Target Audience Goals
RISC microprocessor and UNIX based performace architecture (HP's PA) New IA-64
microprocessor and Merced chip HP-UX Product line Delayed at least 6 months McKinley, a
second generation IA-64 microprocessor, is scheduled to release one year later Knowing when
and how HP should change from its proprietary PA to IA-64
Where to allocate resources Questions To Consider Should we wait for McKinley?
Do we continue to support RISC/UNIX with a part of our limited resources?
Do we go after a share in the low end RISC market?
Do we partner with competitors, such as Sun? Very high end of the computer industry
Mainframes for large corporations
Internet web-servers
Supercomputers and workstations used by scientists and engineers CISC and Windows Sun and
Solaris Partnering with other companies Advanced RISC Machines (ARM) More delays in the
IA-64, Merced, or McKinley In trying to release them or the manufacturing process Not being
able to differentiate in IA-64 chips This would be a major problem if they were not as effective
as hoped with the compiler May continue to disappoint Wall Street analysts until IA-64 is ready
Partnering with Sun Microsystems Rapid consolidation of second-tier competition into their
Solaris UNIX operating system
By 1997 Sun became the vendor of choice for UNIX-based systems
Immediately increases revenues
Reassures customers and the industry HPs commitment to UNIX based systems
Gives more resources and time available for research in Merced Define a plan that is acceptable
to HP senior management
Deliver near-term improvement in earnings growth
Strengthen HP's long-term position in the high-end market Theory Releasing Merced &
McKinley Allocate needed resources to finish Merced project
Launch Merced as soon as Intel gives the 'go ahead' Core Competencies Innovative products
Management culture
Able to reinvent itself as markets change and evolve
High-end microprocessor design expertise
Manufactures microprocessors "in house" Competitive Advantage At the moment we do not
have a competitive advantage
Once we release Merced we will have the advantage of in-depth knowledge and early access to
IA-64 architecture Hewlett Packard's Merced Decision By: Amanda Champion, Debbie
Radunzel, Josh McGinley, Scott Disney, Brad Hau, and Caitlin Cerra BUS 479 Section 006 Case
Analysis #1 Any Questions? ARM Technology Not a current threat to HP/Intel
Targets low end of the market
Costs 1/10 of the price of conventional microprocessor
Has the potential to gain large market share Partner with Sun
Release Merced as soon as it is ready
Release McKinley as soon as it is fully developed 2 worlds of microprocessor based computer
industry Be the first mover into IA-64 architecture
Help develop HP in this blue ocean
Potential for revenue Continue developing McKinley - second generation of Merced Compiler
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"Door Closer"
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