Microsoft-HP marketing effort targets businesses

Technology giants and longtime partners Microsoft and Hewlett-Packard on Wednesday trumpeted a three-year, $300 million joint-marketing investment focused on large businesses.

The deal includes joint sales, marketing and services plans; training for thousands of HP consultants on Microsoft's new products; and an expansion of the products and services the companies offer together in five areas.

Executives from both companies called this an important milestone in the deep, long-standing relationship between them.

"The most comprehensive partner ... out of the 640,000 partners that we have at Microsoft is Hewlett-Packard," Kevin Turner, Microsoft's chief operating officer, said at a joint news conference Wednesday.

The partnership between the largest software maker and the largest seller of PCs goes back 20 years. Today the companies count some 20,000 business customers in common.

That history raises the question of what they're doing that's new, and what justifies headlines in the midst of the largest wave of product launches in Microsoft's history.

"On the one hand, this is business as usual. They work together," said Paul DeGroot, an analyst with Directions on Microsoft in Kirkland. "On the other hand, they build this [their marketing plan] new every year. ... So there's an argument to be made that, sure, they may as well tell the world what their priorities are."

The companies said they are now working together in new, high-growth areas that business customers need.

"What's new about this is the scale and scope that's different than what we've done in the past," said Peter Boit, vice president in Microsoft's Enterprise and Partner Group.

In addition to the area where they've worked most closely in the past — desktop and server operating systems — they're jointly offering products and services in four other areas, which match closely with business-focused products Microsoft is introducing.

These include unified communications, which combines instant messaging, e-mail and voice calling. Microsoft is selling its just-launched Exchange Server 2007, among other software, for that purpose. Another focus area is collaboration, for which Microsoft is offering SharePoint Server 2007.

It's difficult to evaluate just how much of an expansion in spending Wednesday's announcement represents. Company executives would not say how the $300 million would be split between them, nor would they disclose specifics of joint investments they've made in previous years.

The two companies regularly have multibillion-dollar annual sales and marketing budgets. Microsoft spent more than $9.8 billion on sales and marketing during the 12 months ended June 30.

The world's largest software company has recently aimed more of its marketing dollars at businesses. Last March the company announced a $500 million, yearlong advertising campaign and sales-force expansion. Wednesday's press conference made reference to the "People-Ready Business" theme at the center of that campaign.

The People Ready campaign has been viewed as an overture to corporate enterprise customers of Microsoft competitors such as IBM. DeGroot said the expanded partnership with HP could be in that same vein.

"It's very important for Microsoft to have a powerful player in the enterprise because they are probably increasingly becoming estranged from somebody like IBM, which has this huge global services business with automatic entree into enterprises," he said.

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com