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Asian Resellers Welcome HP/Compaq Merger

In February 2002, Gartner surveyed almost 700 IT resellers across 11 countries in Asia Pacific to find out their opinions on the proposed HP and Compaq merger.

The results showed that almost 60 percent believed that the merger was either good or pose little difference to them while more than 20 percent thought it would be bad for the IT industry and therefore bad for themselves, said Martin Gilliland, Gartner's senior industry analyst for channels in Asia Pacific.

"Whatever the makeup of the proposed merged entity, both organizations should be taking steps now to reassure more than one fifth of their business partners across Asia Pacific that this deal is good for both parties," Gilliland suggested.

China, possibly the most important IT market in the world over the next 10 years, was the most positive of all countries surveyed with 67.3 per cent believing the merger would be good for the industry. At the same time 32.7 per cent thought it would not be good. Interestingly all those surveyed in China voted for or against the merger, no one sat on the fence or declined to comment.

Support for the merger was strongest amongst resellers that currently sell HP or Compaq PCs and servers. Of those resellers that listed either HP or Compaq as their main PC vendor, 44.9 per cent thought the merger was good and only 18.8 per cent thought it was bad.

The countries where the perception of the planned merger is weakest are some of Compaq's strongest markets in the Asia Pacific region with resellers in Australia (23.6 per cent), Taiwan (28.6 per cent), Singapore (29.3 per cent) and New Zealand (29.8 per cent).

Despite the fact that Korea appears to have one of the more positive views of the merger with 36.4 per cent voting in favor of the deal, it also had the highest rate of negative sentiment that matched the positive votes at 36.4 per cent.

"Clearly, Compaq and HP have varying degrees of strength at the country level, the challenge for the merged entity will be to develop programs and strategies that leverage these strengths amongst the regions resellers," said Gilliland. "A blanket approach to resellers across Asia Pacific will not work. I would hope that those working on the merger plans for Asia Pacific are aware of this and will emerge later this month with a clearly defined channel strategy that will address the parochial nature of Asia."

HP/Compaq Merger: Asia Pacific Reseller Survey 2002



Good (in %)Bad (in %)No Difference (in %)No Comment (in %)Total (in %)
Asia Pacific38.421.418.321.9100
Australia23.620.034.521.9100
China67.332.70.00.0100
Hong Kong37.08.730.423.9100
India43.39.014.932.8100
South Korea36.436.420.56.7100
Malaysia46.812.810.629.8100
New Zealand29.831.917.021.3100
Philppines41.727.822.28.3100
Singapore29.317.112.241.4100
Taiwan28.611.414.345.7100
Thailand40.013.320.026.7100

Source: Gartner (March 2002)