Winkler: HP Won't Spin Off Printer Business

Acknowledging a "large moose on the table" following last week's ouster of Hewlett-Packard Chairman CEO Carly Fiorina, HP Executive Vice President Mike Winkler on Monday told several thousand channel partners that the company remains committed to its current strategy and isn't interested in spinning off its highly profitable printer business.

"We are committed to the strategy; we are committed to the portfolio. That means there is no desire, intention or plan on the part of the board to spin off any of the HP businesses," Winkler said in a keynote address kicking off the HP Americas Partner Conference, held this week in Las Vegas. "We wouldn't have formed IPSG [Imaging and Personal Systems Group] just recently if we intended to spin off the printer business. We wouldn't have formed IPSG if we intended to spin off the PC business."

Among the reasons for Fiorina's ouster were "performance issues" and the need for a "hands-on executive," Winkler said. However, he said there's no debate about the strategy itself. "Our objective is to continue to accelerate our execution against the current strategy, as it is articulated."

"We have a dedicated team that is focused on meeting customers' needs, including your needs," Winkler told partners. "We are going to have the same people, we are going to have the same organization, we are going to have the same structure and we are going to have the same strategy," he said. "So stick with us. Believe what we are telling you, because it is what we will deliver against."

HP remains firmly committed to growing business that goes through channel partners, Winkler said. More than two-thirds of HP's $80 billion in annual revenue comes through partners, and partner revenue has grown in five of the last six quarters on a sequential and a year-over-year basis, Winkler said.

"You are an equal part of our strategy and an integral part of our success," he said. "The 150,000 HP employees thank you."

In 2004, HP and its partners together did $10 billion in public-sector business, $8 billion in adaptive enterprise business and sold 47 million printers, according to Winkler. Those numbers drew loud applause from solution providers.

"In 2005, we will do more than that. We will win more business together," Winkler said. He urged solution providers to use the partner conference as a springboard for growing that business--not just in 2005, but beyond. "Let me make it very clear: Our strategy is to grow our channel business," he said.

Don Richie, CEO of Sequel Data Systems, an Austin, Texas-based solution provider at the conference, said he was optimistic about his HP partnership. "I am absolutely convinced they are committed to the channel," Richie said. "I am also absolutely convinced they are committed to the existing strategies, without changes for the foreseeable future."