HP Plans Cuts; User Group Shuts Doors: Interex, HP World Hit by Finance Woes

The end of the 100,000-member Interex user group and the HP World conference it was due to hold in August arrived suddenly last week. But the organization's financial collapse was months in the making.

Most Interex members, who now find themselves without an educational, advocacy and support outlet, had no inkling of the problems facing the 31-year-old user group following Hewlett-Packard Co.'s decision to launch its own conference this year.

For example, Rita Workman, a Unix administrator at the West Virginia Bureau of Employment Programs in Charleston, said she was stunned by the cancellation of HP World 2005. Workman was scheduled to give a presentation about her agency's disaster recovery plan at the conference. HP World "was actually the one conference I did enjoy," she said. "It was basically geared to the users -- not controlled by the vendor."

"Wow, what a waste," said Paul Gerke, a systems administrator for Clark County in Vancouver, Wash., referring to the demise of Interex.

Gerke said HP World was a good source of unfiltered information about HP products. In comparison, the presentations at a storage conference that was run by HP in May "were all very 'HP, rah-rah,' " he said. For that reason, Gerke had decided not to attend HP Technology Forum 2005, the new conference the vendor is holding in September.

Interex closed without explanation. Calls to its office weren't returned, and a statement posted on its Web site last Monday said only that the group's leaders "have found it financially necessary to close the doors." Interex is expected to file for bankruptcy protection, sources said.

A Big Choice

The shutdown came almost exactly one year after HP said it planned to run its own conference . Interex and the three other independent HP user groups faced a big choice: Join HP as co-sponsors or continue to hold separate events.

Interex decided last August to go forward with HP World, which was a major source of revenue for the Sunnyvale, Calif.-based user group.

But some people were worried. In March, Kees denHartigh, HP World program co-chairman and a systems network analyst supervisor at the University of Alberta in Edmonton, wrote to HP officials to express concerns about competition from HP's conference.

In his letter, which he provided to Computerworld last week, denHartigh said he had heard reports that some vendors weren't going to lease trade-show floor space at HP World because they would have booths at the HP Technology Forum instead.

HP officials responded to the March letter saying that his view of the company's intentions was inaccurate.

He sent a second letter on July 7 -- nine days before the cancellation of HP World -- to CEO Mark Hurd to reiterate his concerns about the competitive threat posed by HP's conference and the appearance that HP was "working hard to put Interex out of business."

He got no response to that second letter.

Conference Cutbacks

HP remained a premier sponsor of this year's HP World, at a cost of about $100,000, according to Interex members and conference organizers, who asked that their names not be used. But it drastically cut back on its trade show presence, the sources said. HP leased 7,000 square feet of floor space at HP World 2004 but was taking only 900 square feet this year, they said.

HP also told Interex that it intended to cut back on the number of technical sessions it supported at HP World.

In the past, HP workers typically handled about half of the conference's 400 sessions. But HP initially said it would do only 20 sessions this year, according to the sources. It later raised that figure, but only to 38, they said.

David Parsons, HP's vice president of enterprise marketing for the Americas region, confirmed the details about this year's plans. But Parsons said there were good reasons for the changes.

About 700 HP employees attended HP World 2004, and the company used the conference for technical training of its workers as well as users and business partners. This year, HP wanted to provide the training at its own event.

HP didn't intend to hurt Interex, Parsons said. He added that the company laid out its HP World support plans last year and that the user group "made a business decision" to pursue its own course.

The Encompass, ITUG and OpenView Forum International user groups said they remain on solid financial footings. Both the OVFI and ITUG said they plan to continue holding their own conferences while working with HP on its event.

Garry Smith, director of information systems at manufacturer Charles McMurray Co. in Fresno, Calif., is a former president of an Interex chapter in central California that had 120 members until it stopped meeting in 2002.

Smith said attendance dropped dramatically as members diversified beyond the now-discontinued HP e3000, the system that prompted the formation of Interex. "It's disappointing to hear of Interex closing, but that's the evolution of things," he said.

On the other hand, John Payne, an HP-UX systems engineer at Brigham Young University in Provo, Utah, said he will miss HP World. "When you get real users showing real stuff, you can't go wrong," Payne said.

Copyright © 2005 IDG Communications, Inc.

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