OCTOBER 11, 1999
"BULLET-PROOF INFRASTRUCTURE FOR THE E-SERVICES WORLD"
© Copyright 1999 Hewlett-Packard Development Company, L.P
All rights reserved. Do not use without written permission from HP.
Thank you, Monsieur Cornu. I'm glad to be here this afternoon.
As I look around the room, I feel right at home. In fact,
I see some of my former colleagues. You know, while I'm now
CEO of a great company that comes from the IT side, I spent
more than 20 years with two great companies in telephony.
And it's more than coincidence that in heading a computing
and imaging company ... I'm now in the room with the world's
leading telecom companies.
My new job is simply evidence of how we're all coming together.
The strict old disciplines many of us grew up on ... are going
away. Voice vs. data, wireline vs. wireless, circuit switched
vs. packet switched ... they aren't different universes anymore.
We at HP know telecom issues and concerns. I know, because
I trained with you. We at HP know because we're your partners
in every piece of the telecom market.
Today, I'm going to talk to you about the common communications
universe we now share. Specifically about:
- seeing the future;
- bullet-proofing the infrastructure for the e-services
- and putting HP's e-services vision to work for the communications
But before I do that, let me take a few minutes to reintroduce
you to Hewlett-Packard. HP's spirit of innovation drew me
to this company. Here was a company that 20 years ago was
talking about pervasive computing ... before anyone else really
knew what that meant. It took 15 years for the rest of the
world to catch up.
Here was a company that used the best quality of future-vision
... while standing around and watching the vapor in an office
coffeepot ... and turned that insight into an inkjet printer,
and the world's largest imaging business. That same creative
energy brought HP's RISC architecture and open systems approach
... because HP knew computing couldn't be pervasive ... if
systems weren't open.
And we will continue down that same open systems path - for
there's room - and there's a need - for everyone who is able
to play in this huge space.
I was also drawn by the fact that HP has long been a powerhouse
in the global telecom sector. HP "gets" telecommunications
... your issues ... your markets ... and your future.
By way of example:
- HP supplies IT infrastructure to every one of the Fortune
- Billing systems on HP computers track 1 billion phone
calls per day.
- We and our partners deliver management, network intelligence,
billing and customer care solutions for UNIX and Windows
- We enable telcos to migrate from network-focused to customer-focused
- Our OpenView platform, another symbol of our commitment
to open systems, is the foundation of modern communications.
Last year, HP generated $8 billion in communications-related
revenues. Telecom sales are growing at 35 percent a year.
We're the No. 2 computing company in the world and the No.
1 provider of IT to mobile operators around the world. We
have an installed base of 130 million printers worldwide.
We're deeply embedded in everything you do.
Finally, HP has been part of -- and in many cases leading
-- every important standards body of telecommunications.
That's today. But what about tomorrow? I came to HP because
I'm convinced that our strength with the telecom sector ...
is a unique opportunity ... to launch your companies into
tomorrow's e-services world. To prepare for that, I've spent
my first 75 days at this company ... lasering our future vision
We've realized we're the Performance Company ... as well
as the Innovation Company. We join the best of both worlds.
As a result, the creations of our company imagination ...
will always be keyed directly to real needs. Customer needs.
Your needs. We've realized that the best ideas in the world
... including HP ideas ... are lost if we:
- don't tell the world about them ...
- if we can't get them to market in time ...
- if we can't make them work for you.
- Most of all, we're all lost ... if we don't prepare you
for the future.
The task for all of us now is to cut loose from the mechanical
business models of the past ... based on the old physical
economy ... and go with the flow of imagination. Envision
what isn't here yet, but what will come.
It's to adopt the skill of the great Swiss psychoanalyst
Carl Jung ... learning to look beneath the surface. Because
if all we see is the surface of today's Internet world ...
where it is right now ... we'll miss what's underneath, and
And we won't be ready for it.
Now, some words about infrastructure for the coming e-services
world - bullet-proof, of course.
The current model of PCs and laptops competing for wireline
space with voice transmissions ... won't be the model for
The current model ... of "do it yourself" on the Internet
... will be coming to an end.
A refrigerator or a car unconnected to the Internet ... will
be headed for extinction.
The model of a business buying software and mastering it
for a customized application ... will be going away.
As everything dissolves before our eyes in this new world,
the ground will be shaking beneath our feet.
The result will be a smarter world, a faster world, a richer
world. For individuals, life will be easier. A lot of the
drudgery of things will be taken care of, via the Net. Whole
new industries, skills and economies will be born.
Everyone in the IT industry is committed to this new world.
We see the real benefits it can yield. We see what this can
do for your companies, your customers, and ultimately for
the global family.
But we also know we can't possibly do it alone. We know we
haven't come this far alone.
You in telecom have been more than our partners. You've provided
the foundation for this vision.
How impressive it is that in virtually all countries in the
world now, you can pick up a phone and be certain you'll get
a dial tone. As you well know, that is no small achievement.
Because you are there for us and everybody else, we've come
Reliable voice and data wirelines are the foundation, and
wireless has opened up whole new regions, like Eastern Europe.
Wireless has also jumpstarted places in the developing world,
where there are more wireless subscribers now than wireline.
But for the e-services world to reach its full fruition,
and lift us all to a new plane of convenience and prosperity
... a similarly reliable network needs to be in place. We
need a bulletproof infrastructure. It needs to be secure,
reliable, ubiquitous - and always on - always working.
It isn't there yet. You and I both know that. But it can
Your challenge is to provide the same bulletproof quality
and availability for exponentially exploding volumes of data,
as you do now for voice. Even though some skeptics like Business
Week say that telecom will be blindsided by the Internet ...
I don't think so. It won't be easy to meet the challenge.
So what else is new? The ability to meet challenges ... is
wired into our collective DNA.
This new world is one that HP has thought about for 20 years.
And out of this soul searching has come ... e-services.
We've been thinking about and preparing for a world of intelligent
interconnected devices accessing services ... anytime, anywhere
.. always there ... always on ... for two decades. Now, as
billions of new devices and consumers come online generating
trillions of new transactions ... our vision is becoming a
We feel so strongly about it that we've split into two new
companies. Agilent Technologies is our former test and measurement
division. They are here today too. But because their products
... and their competitors ... are so different from ours in
computing and imaging ... the split allows both of us to focus
with the necessary speed.
As for what the new laser-focused HP brings our customers
like you ... we bring you total solutions ... from start-up
financing to customer care.
We aren't just a hardware company, although our hardware
and Mission Critical Computing are valuable pieces of the
mix. But for an SP or telco first finding their way into the
new e-services world ... or for somebody who wants to maintain
their early lead there ... we can be with you every step of
And e-services is the vision that drives our solutions and
our strategy. Some of our competitors are offering visions
and products that sound vaguely like e-services. But when
you scratch the surface, you find they have limitations ...
and perhaps a different vision altogether.
HP's e-services are different from the competition, because:
- no one understands Mission Critical computing platforms
like we do ...
- no one is more committed to open systems and standards...
- no one is more networked ...
- we're truly global ...
- building and sustaining partnerships is a core competence
- we have one of the largest financing capabilities in the
- we're consumer as well as enterprise focused ...
- and we're appliance-friendly.
In fact, we started talking about and building information
appliances long before it was a buzzword.
Nobody else is doing it the HP Way.
HP E-services is built on more than vision. But there's more.
It's built on a real HP breakthrough called e-Speak. E-Speak
was started 5 years ago in HP Labs. We were initially looking
for a way to turn virtually any IT resource ... into a service.
Using printers, storage, computing more efficiently was our
But we realized e-Speak has the power to break down the communications
barrier that has kept so many systems, devices, programs and
IT brands ... separate and unconnected for so long. HP's e-Speak
is the universal compiler and translator ... the Rosetta stone
of the brave new everything networked world.
I repeat ... e-Speak is universal. It is pure HP.
E-Speak doesn't change the application or the operating system.
E-Speak automatically registers the attributes of both users
and services ... negotiates content ... manages backup and
restoration in case of failure ... and provides a uniform
framework for appliances, network computers and PCs of all
makes. Think of what we can all do with this architecture
- the doors it opens.
With the rise of the Net, e-Speak can be used to enable e-services
to talk to one another ... to identify what they can do, to
broker e-services and find the best e-service for a particular
By creating this universal compiler, e-Speak enables an e-service
to draw on virtually any other e-service on the Net to complete
a specific task. This is why the e-services marketplace is
going to grow at an exponential, not a linear, rate.
What do we mean by e-services? An e-service is ... any asset
that is made available via the Net to drive new revenue streams
... or create new efficiencies.
E-services can be applications, computing resources or services,
processes or information.
They'll conduct a transaction, complete a task or solve a
problem. They'll be used by people, applications, businesses,
even things. Some already are, and will be, available on Websites.
Others will work behind the scenes ... invoked automatically
by all sorts of Internet-enabled computers, devices and things.
The proliferation of e-services will span all industries.
All kinds of services will be offered as e-services, to more
people, via a wider variety of devices.
Business-to-business e-services will include things like
billing, automated supply chain management, procurement and
Computing e-services will allow companies more flexibility
in managing IT infrastructures, like outsourced storage, directory
services and datamining.
Pay-per-use consumer e-services will do things like financial
planning, trip planning, traffic routing.
And we will plug into them via utility-like infrastructures
... corporate networks, the Net, phone companies and ISPs
... using a variety of devices like cellular phones, pagers,
PDAs, televisions, even cars.
If that's too big and nebulous, let's see where we are now.
Chapter One of the Internet is coming to an end. Chapter One
was the story of single customers contacting single businesses
with a browser. Chapter One was about exchanging information
... buying and selling in single transaction lines. HP helped
write Chapter One through our open systems approach. We saw
early on that connectivity was going to be the key ... and
we provided that key.
- We championed infrared technology and communications standards
- We pioneered 100 megabit and gigabit Ethernet networking.
- We provided essential software capabilities through products
like Virtual Vault and OpenView.
Our HP OpenView is the de facto industry standard now, managing
more than 100,000 networks ... 70 percent of net activity.
The same goes for our Virtual Vault online security solution,
adopted by more than 100 banks worldwide.
But Chapter Two is here and it's the big bang. Where as in
evolutionary biology, there were simple amino acids for eons
... suddenly they exploded into a million life forms.
E-services is the explosion of Chapter Two. And Chapter One
didn't last a billion years ... it only lasted three or four.
E-services does to Internet hierarchies and business models
what deregulation does to any industry ... and more.
In Chapter Two, no more do it yourself on the Web. The Web
will do it for you. Services are becoming person and context-aware.
Things will now happen automatically, according to your known
For example ...
You're in China and you have a business meeting coming up
that day. And, by the way, you don't speak Mandarin and your
clients don't speak English. So you pull out your handheld
and you let it know when the meeting is ... and your offered
price of $300 an hour for an interpreter. Your bid goes around
the world. Within a few minutes you are matched with an interpreter
who will be linked with the meeting for the agreed price.
In the meantime you can do something more interesting.
That's at the individual level. At the company level, we're
going to see enterprises comprised of thousands of e-services
... some built by the company itself, but most subscribed
to, leased or rented from sources outside the company.
Our vision of e-services includes three new business models.
Not only are they certain to arise in the future ... they
are already taking shape now. And HP is helping to build them.
The three models are:
- next-generation portals; and
- dynamically brokered services.
Apps-on-tap mean outsourced application services. We expect
them to become mainstream this year. Forrester predicts this
market will grow from $90 million last year to $10 billion
by 2001 -- or 15-20 percent of all applications. ASPs will
be there for enterprises to rely on the providers' specialized
expertise, rather than trying to figure out how to handle
these processes expertly in-house. Corporate customers will
rent, subscribe or pay as they go for using these applications.
Outsource hosting of e-mail services will be the first and
easiest. But others will follow.
Next-generation portals will combine a set of complementary
services and link them intelligently. Horizontal portals will
serve specific functions like accounting or procurement for
a whole range of different companies and industries. Vertical
portals will serve specific industries. Enterprise portals
will aggregate services in new ways ... to gain customer loyalty
or better support employees or partners.
Finally, dynamic brokering is an expanded version of the
Chinese language interpreter example I gave a minute ago.
This model is proof of why the e-services marketplace is going
to grow at an exponential, not a linear, rate.
But only if our telecom infrastructure keeps pace. It would
be a real pity to limit economic growth, through insufficient
Can the infrastructure be put in place? A bulletproof infrastructure?
Nobody wants to endure the negative news headlines about
your Website going down and customers losing out. CNBC in
the U.S. is now giving a daily report on the response times
of online trading sites.
But that's the world we're headed for. Soon, we will all
be judged on the performance and the responsiveness of our
If your enterprise customers suffer because of a telecom
problem, they will take the heat from their customers. But
while you're not as visible, you're just as vulnerable. That's
the terrible reality of this new world. Because global connectivity
makes your customer's problem ... your problem.
HP's strength in the telecom future ... isn't just a mix
of superior vision and performance-proven tools. It's partnerships,
agreements and breakthroughs. HP and its partners have scored
big in the telecom sector ... especially in the last several
months. Numerous deals and partnerships have been sealed with
more to come in swift succession.
As just two examples:
We began a strategic alliance with Nokia to jointly develop
and market business-critical mobile Internet solutions. Under
the agreement, Nokia and HP are working together to create
Wireless Application Protocol (WAP) -based solutions for HP-UX,
Windows NT and Linux servers.
And HP has been chosen by our host city, Geneva, to be the
integrator and a co-sponsor of the first worldwide showcase
of a standard-based, multi-vendor WAP Service: Geneva Now.
Today you can see - and feel - the culmination of our decades
of telecom partnerships. And you can get a glimpse of what
kind of infrastructure the new e-services world will demand.
Our future vision ... is becoming a reality.
Just this morning, I announced the latest in a series of
initiatives aimed at enabling the creation of mobile e-services
for wireless service providers and extended enterprise environments.
Twenty-three communications companies have lined up behind
us. And that's only the beginning.
We call it the HP Mobile e-services Program. We intend to
become the major worldwide player in the Internet-enhanced
The worldwide mobile data market is projected to be $80 billion
within the decade. By 2001, we expect the number of mobile
phones to exceed the number of PCs and to reach the one billion
mark by 2003. Half of these mobile devices will be data capable.
HP is committed to teaming with leading industry players
to develop next-generation mobile service solutions. These
will be based on the company's e-service technology and Wireless
Application Protocol (WAP) standards.
Mobile devices and Internet technology are the two watershed
events as we draw to the end of the 20th century. HP's ambition
is now to help lead the next chapter ... as we enter the new
millennium. We'll do this by combining mobility ... with a
new generation of intelligent e-services. We'll offer a suite
of services like consulting ... financial support ... and
joint marketing activities.
Additionally, we'll provide Mobile e-services-on-tap over
the Net on a pay-per-use basis for SPs, including infrastructure
... management process ... and global capabilities required
to run and rapidly scale their businesses.
We're also creating a worldwide Mobile e-services Bazaar,
starting in Finland ... the Silicon Valley of mobility. Our
Bazaar will provide development, business, marketing and sales
assistance to application providers. An HP-branded portal
will allow operators and enterprises to learn about and download
trial Mobile E-Services.
Merging wireless into the e-services world ... is our best
shot at creating total connectivity for this planet.
Like everything else we do ... HP is telecom's performance
partner to build the mobile e-world. The pent-up energy of
my organization ... is now targeted right.
We all need each other now. We at Hewlett-Packard are ready
to stand with you ... to build this e-services world infrastructure.
So as you grapple with turning this week's ideas ... and
visions ... into reality ... we hope you'll consider us your
partner. We've been working with you for decades. We know
your business ... just like you know our products, our services,
The door to the e-future is halfway open ... but neither
one of us can push it open alone. We've got to stand shoulder
Today, in this hall, we're dealing with the creation of the
collective consciousness. More than anything, the world we're
building together ... is about the end of isolation. The world
we're building together is the creation of a collective imagination
... the creation of a collective intelligence ... the creation
of a collective energy ... that will lift us to levels we
cannot yet see.
The Big Bang is here. Knowledge ... and products ... and
services ... will explode to fill our lives. But this is not
something to be afraid of. The individual is the big winner
here. The individual is liberated.
These machines, devices, services ... they are only our tools.
They are only tools for each and every one of us. If we choose
to use them ... they will empower us. The parent ... the child
... the thinker ... the artist ... the merchant ... the official
... all of us, can be more than we were before.
Imagine the creativity ... that we can unleash.
Envision it. Believe in it. Build on it.
We do, at HP. And we're ready to build it ... with you.
Thank you very much.
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