Hewlett Packard Enterprise Co. (HPE) has neglected its software testing products for years and recently decided to spin-off and sell its software assets entirely to Micro Focus. The list of tools being spun off and merged includes HP Unified Functional Testing (UFT), Quality Center, LoadRunner, Application Lifecycle Management, among others.
We recently wrote a white paper on the spin-merge. The goal of this whitepaper is to shed light on the following five areas:
- Traditional Challenges with HP Testing tools
- HP-Micro Focus Merger: Why You Should Be Concerned
- An Unbiased Analyst View into HP’s Performance
- What Analysts Recommend Given Recent Developments
- How SmartBear Can Help
In a nutshell, the HP-Micro Focus spin-off is destined to cause significant challenges for current HP customers. These include customers contemplating what the future of HP assets overlapping with Micro Focus would be, how Micro Focus will go about balancing cost consolidation and active product development, and the concerns regarding growing debt levels.
To make matters worse, sales of HP software division have continued to decimate as the spin-merge with Micro Focus goes through regulatory approvals. Both new license revenue as well as support revenue fell by 9% in the last three calendar months to January 31, 2017. Overall software division saw revenues decline by 8%.
With revenues of HP’s software business declining, in order to hit the promised synergy numbers, Micro Focus will most likely consolidate costs across two businesses and thereby increase operating income margin. The recent layoffs of software engineers and programmers is possibly the first step in this direction. Balancing active new product development for trends like Agile, Continuous Delivery, and Microservices along with maintaining optimal support service level can become challenging while such a cost consolidation occurs.
At the same time, over the past few months, we have seen an increase of HP customers aggressively moving off HP’s legacy testing products in favor of modern, affordable solutions like those from SmartBear. Some of the customers who have migrated to SmartBear tools include:
The reasons for their migration could be categorized in the following six areas:
- Support Quality and Timeliness: HP’s support teams can often be slow to respond and provide insufficient guidance about how to implement product capabilities, integrate tools, or even work around to known product issues.
- Support Costs: HP testing tools are complex and expensive to support and maintain. Upgrades are time consuming. New versions often deprecate key features without notice. This results in increased risk.
- Licensing Costs: Expensive renewal rates, software license fees, along with dedicated external consultant fees can often result in costs associated with HP testing tools going out of hand.
- Roadmap Uncertainty: Given HP’s recent spin-merge with Micro Focus, customers frequently report that there is very little visibility into the future product plans and viability. New versions often deprecate key features without notice. This results in uncertainty and introduces risk to customers’ test automation frameworks.
- Limited Open Source Support: In an agile landscape, teams often feel most comfortable using open source tools. This however can be challenging to achieve with legacy vendors like HP who often have their own toolsets to cross-sell. Unlike Smartbear who has looked to adding value on top of open source tools such as Selenium, Appium, HP has been particularly focused on building integrations to HP ecosystem to ensure customers keep using other HP tools.
What to Do Next?
The uncertainty around HPE's recent decision to merge its software testing tools with Micro Focus, from the recent layoffs of HP software engineers to the HP revenue decimating raises the question: What should customers using HP testing tools do next? Read this whitepaper to ensure you are well informed about the HP-Micro Focus merger and ways to navigate what’s coming.
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