H-P into the Cloud Computing

To help enterprise customers efficiently drive business benefits from "cloud computing," Hewlett-Packard (HPQ - Analyst Report) introduced new consulting services -- the HP Cloud Discovery Workshop and HP Cloud Roadmap Service. "Cloud computing" refers to a system in which tasks are assigned through a combination of connections, service and software over a network.

The HP Cloud Discovery Workshop is designed to help enterprise IT organizations discover cloud computing as a strategic service delivery option and gain benefit from it. This service will help educate businesses about the benefits and challenges of cloud computing, and give recommendations regarding processes and technologies needed to get started. The service is expected to be available in July.

The HP Cloud Roadmap Service offers customers a service for planning and adopting cloud computing as part of their service delivery strategy. These services will help customers evaluate cloud services as an integral part of their overall IT service delivery strategy. It will help set up a road map for adopting cloud computing, including what businesses can aspire to achieve and what steps should be taken accordingly.

Earlier, HP unveiled HP Cloud Assure, a new Software-as-a-Service (SaaS) offering designed to help businesses adopt cloud-based services.

"While many organizations understand the core benefits of the cloud model,
there remains a level of uncertainty to strategically leveraging the promise
of cloud," said Frank Gens, Senior Vice President and Chief Analyst at IDC, a research firm that expects spending on cloud services to reach $42 billion by 2012, 3 times higher than the current level.

Despite the progress made by HP within its Services business, the company is still in a vulnerable position. Other technology vendors, such as International Business Machines Corp. (IBM - Analyst Report) and Sun Microsystems Inc. (JAVA - Snapshot Report) are rolling out services designed to make it easier for businesses to develop and migrate to cloud computing.

Also, Google Inc. (GOOG - Analyst Report) and Amazon.com (AMZN - Analyst Report) are currently the cloud computing vendors who stand as the toughest competition for HP.

We maintain our Hold recommendation on HPQ shares with our six-month target price of $38.00.