ARCHRIVALS Sun Microsystems and Hewlett-Packard are deepening their respective strategic commitments to managed services, with Sun promising to tie services tighter to core products and HP cementing its plans in managed services, citing its recent merger with Compaq as a major reason.

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The moves come at a time when vendors are seeking to offer customers a comprehensive set of enterprisewide managed-services offerings that bolster sagging margins in other areas.

Although Dell has been mum on its managed services intentions, an integration deal reached with Jareva Technologies earlier this year to incorporate the IT automation vendor's platform as part of Dell's Systems Management Portfolio could prove a precursor to future moves.

Sun, for its part, reinvigorated its services strategy in response to user demands for improved value around solution delivery. The company outlined plans to tightly align its services division with internal product, sales, and partner initiatives via a shared knowledge management system. To support its new mantra, Sun unveiled a quartet of IP-based services offerings.

Focused solely on training and support of its own and partner products, however, Sun has no intention of embracing an IT services role, according to Patricia Sueltz, executive vice president of the services division at Palo Alto, Calif.-based Sun. "We have not done outsourcing, nor will you see us do outsourcing," Sueltz said. "We help [customers] in managing a specific service."

Sun must rework its muddled services message or risk confusing its customers, said Laurie Seymour, program manager at Framingham, Mass.-based IDC's xSP Research.

"It comes across that [Sun wants] to compete against IBM and HP in professional services, but that's not at all what they're offering," Seymour said. "They're hard-charging off into this new realm, and they're confusing their customers instead of helping them."

Part of HP's success, company officials claimed, is that many of its larger customers are feeling more confident about the HP-Compaq merger and the company's ability to offer a broader range of services.

"A lot of users' investments tend to be around trying to get more out of existing assets. Sometimes this translates into an outsourcing deal for us or a lightweight technology refresh," said Juergen Rottler, vice president and general manager of services at Palo Alto, Calif.-based HP.

Some industry observers agree that the combined company seems to be positioned more competitively for the future and that it appears to be taking advantage of both HP's and Compaq's respective strengths in the services market.

IDC's Seymour said HP is spreading itself too thin as it dives into IBM-infested IT services waters.

"I think [HP] has put a lot on their plate. They're trying to do a little too much. The question is, What's going to suffer?" Seymour asked.

"What I see HP trying to do is metamorphose themselves to compete on a technology and services scale with IBM, which is incredibly difficult to do, and you need another Lou Gerstner and team to pull that off. Is Carly capable of being another Lou? I'm not sure," Seymour added, referring to IBM's chairman and HP's CEO Carly Fiorina, respectively.