HP and Intel CEOs highlight impact of content boom

HP and Intel CEOs highlight impact of content boom

Firms are under increasing pressure but there is also a great opportunity for IT

The growth of digital content is creating huge pressure, but also massive opportunities for the IT industry, according to Intel and HP's chief executives speaking at this week's Oracle OpenWorld event in San Francisco.

At the show, Intel chief executive Paul Otellini highlighted the massive growth of content and its impact on the enterprise. He used Intel as an example of the massive pressure on IT departments today - the firm is currently running 118 datacentres, 93,000 servers and 95,000 email inboxes.

On a wider scale, Otellini said there are currently one billion email boxes in action, one billion instant messaging users and two billion online videos viewed every day.

"By 2010, 70 percent of web digital content will be created by individuals, not the movie studios," Otellini predicted. "These trends will have a profound impact on the enterprise, as 24/7 computing is becoming the norm for everyone. What we need to think about is the socialising of our networks. The future is not that far away, and it's a highly collaborative, highly interactive global social network."

Earlier in the week, HP chief executive Mark Hurd revealed that he views the boom in content as a positive shift.

"The fact that there's more content is fantastic for us. The fact that there's a desire to have it globally is fantastic to us. It's a great IT opportunity," he explained. "Anyone creating content – whether it's video, structured, unstructured, bloggers, wikis – the more the infrastructure has to respond. Our job is to ensure that the best infrastructure is in place to support that content across the globe from enterprises to consumers."

Hurd's comments were in response to a question from an OpenWorld delegate about HP's view of Google and Yahoo. The questions, shown as video clips during the keynote, were part of a vox pop HP carried out around the streets of San Francisco. Hurd said that the firm "liked not just Yahoo and Google, but News Corp, AOL and Dreamworks" – any organisation fuelling the content boom. He added that the demands of the younger generation, who want access in a split second, was a huge issue. "Their tolerance to a slow response is pretty much zero," he explained.

Merger and acquisitions activity will also continue to see growth, according to Hurd. "There's a push to have less suppliers, and more standardisation and integration. Consolidation will move at a pretty reasonable pace," he said.

Future M&A activity will be partly a result of those industry players with $100bn of cash, Hurd said. "There's only three places for that $100bn to go: Dividends to the shareholders; buying back stock; or acquisitions," he explained. "In many cases M&A activity will rise to the top of the list when measuring the value of the three choices.

Hurd closed with a message of reassurance to HP customers. "We've had a lot of work to do to transition our company over the past couple of years and we appreciate your patience. I wouldn't want any of you to take any of my comments today as anyone at HP thinking that our work was done," he said.