Compaq joins pay-as-you-go crowd

TORONTO — Compaq Canada Corp. Tuesday announced six new services-based computing packages that the company believes will change how technology is purchased, deployed, and managed in a business environment.

Called “Access on Demand” packages, they feature Compaq’s line of Evo PC products and the iPaq.

Access on Demand, which is part of Compaq’s Computing on Demand strategy to focus more on IT services and solutions, will provide enterprise customers in the 500 to 3000 seat range a single point of contact, said Reg Schade, vice-president of global services at Compaq Canada.

The packages are being sold on a price-per-seat basis for a three-year period, with the base package starting at $89 per month per seat, and cover a defined set of hardware and services, including warranty, help desk assistance, technology updates, asset reporting and program management.

Mike Pearce, business manager for Compaq Global Services’ customers solutions unit, said the entry-level package covers fulfillment and enablement. “It gives you the fundamental requirements.”

Customers can then build from there, depending on their needs. “The ultimate would be full outsourced,” added Schade.

The program is being rolled out across North America. “We’ve got a lot of customers in Canada that are in the U.S. too and vice-versa,” said Schade, adding that the biggest concerns of customers when procuring computing hardware and services is flexibility and time to market. Access on Demand allows customers to exchange large up-front capital expenditures for a monthly expense, he said. “Computing on demand is changing how we go to market.”

Compaq executives did not want to address the proposed merger with Hewlett-Packard Co., but they said it has a component in service contracts that assures the customer that any agreement will be honored no matter how Compaq as a vendor evolves over the next year. Earlier this month HP said it would merge with Compaq in a transaction worth about US$25 billion.

Warren Chaisatien, analyst with IDC Canada in Toronto, said despite those assurances, Compaq faces some customer skepticism. Customers may be more comfortable signing a similar agreement with HP than with Compaq, since they know the HP name isn’t going to disappear anytime soon.

Otherwise, said Chaisatien, Compaq is headed in the right direction, and although other firms such as HP and IBM have similar services strategies, he said Compaq’s made a good choice by building on its strengths as a hardware vendor. “It doesn’t surprise me that they’re approaching this from a PC perspective.”

HP is more aggressive in the back office, noted Chaisatien, whereas IBM also has a utility strategy, but it tends to focus on outsourcing.

“The ultimate objective of all the vendors is the same.”

As the margins on PC sales have shrunk, PC makers are slimming down their support to just the hardware and the operating systems, said Schade, and nothing else. “A lot of companies are pulling back on what their warranties offer. The onus has been put back on the customer.” In addition to supporting the hardware and operating system, Compaq anticipates that it will be supporting close to 150 different software suites.

While the technology savvy may be willing to go to Web site to resolve a technical issue, corporate users have other priorities, said Schade.

But Compaq, he said, is in a better position to offer a single, consolidated offering of both product and support. “What we’re doing is incorporating the support into a utility model, (but) we still have to be very cognizant of the price of the PC.”

This does not require additional investment on Compaq’s part, said Schade, because it’s leveraging core competencies such as its existing call centre facilities. Compaq Canada’s global services organization will be the primary point of contact for customers throughout North America for Access on Demand from its call centre in Ottawa.

The centre employs more than 1,000 people and was the recipient of Call Center Magazine’s award for “Technology Sector Call Center Of The Year” in May 2000. “We expect to see employment grow,” said Schade.

Companies like Dell, he said, have no choice but to go to a partner model to offer the same level of support.

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