HP Cloud Investments Could Include Rackspace Deal
June 19, 2014
Grazed from Investors. Author: Editorial Staff.
Hewlett-Packard has stepped up investments in cloud computing, prompting some analysts to speculate that it could make a big move such as acquiring Rackspace Hosting. That, however, would require HP (NYSE:HPQ) to ratchet up its spending significantly, since Rackspace (NYSE:RAX) could sell for $6 billion or $7 billion.
HP in May said that it plans to spend $1 billion over the next two years to develop cloud products and services. At an annual conference for business customers in Las Vegas this month, the Palo Alto, Calif.-based HP said that it will expand from two data centers to 25 by the end of 2015. The data centers will be packed with servers and data-storage systems that customers rent via the cloud…
HP is playing catch-up to Amazon Web Services, part of Amazon.com (NASDAQ:AMZN), in the cloud field known as Infrastructure as a Service. Microsoft (NASDAQ:MSFT), Google (NASDAQ:GOOGL) and IBM (NYSE:IBM) also are IaaS leaders. As in the case of IBM and other traditional IT suppliers, HP’s sales of hardware and software could slow as more companies opt to rent computing technology rather than build new data centers of their own. That’s why expanding into IaaS and related cloud products and services is a good move for HP, analysts say. HP stock is up nearly 25% in 2014 as the company is two years into its turnaround plan…
Read More At Investor’s Business Daily: http://news.investors.com/technology/061814-705222-hp-speculation-rackspace-acquisition-deal-synergies-questioned.htm#ixzz355YvTp4V