HP 2009 Annual Report Download - page 19

and automation, our strong track record of collaboration with clients and partners, and the combination
of our expertise in infrastructure management with skilled global resources in SAP, Oracle and
Microsoft platforms.
HP Software. The areas in which HP Software operates are fueled by rapidly changing customer
requirements and technologies. We market enterprise IT management software in competition with
IBM, Computer Associates International (‘‘CAI’’), BMC Software, Inc. and others. Our information
management and business intelligence solutions compete with products from companies like Symantec,
IBM, EMC, CAI, and Teradata. We also deliver communications and media solutions that compete
with products from IBM and various other competitors. As new delivery mechanisms such as
software-as-a-service come on the scene, we’re also confronting less traditional competitors. Our
differentiation lies in the breadth and depth of our software and services portfolio and the scope of our
market coverage.
Personal Systems Group. The areas in which PSG operates are intensely competitive and are
characterized by rapid price reductions and inventory depreciation. Our primary competitors for the
branded personal computers are Dell, Acer Inc., ASUSTeK Computer Inc., Apple Inc., Lenovo Group
Limited and Toshiba Corporation. In particular regions, we also experience competition from local
companies and from generically-branded or ‘‘white box’’ manufacturers. Our competitive advantages
include our broad product portfolio, our innovation and research and development capabilities, our
brand and procurement leverage, our ability to cross-sell our portfolio of offerings, our extensive
service and support offerings and the availability of our broad-based distribution of products from retail
and commercial channels to direct sales.
Imaging and Printing Group. The markets for printer hardware and associated supplies are highly
competitive, especially with respect to pricing and the introduction of new products and features. IPG’s
key competitors include Canon USA, Inc., Lexmark International, Inc., Xerox Corporation, Seiko
Epson Corporation, Samsung Electronics Co. Ltd. and Brother Industries, Ltd. In addition,
independent suppliers offer refill and remanufactured alternatives for our supplies which, although
generally offering lower print quality and reliability, may be offered at lower prices and put pressure on
our supplies sales and margins. Other companies also have developed and marketed new compatible
cartridges for HP’s laser and inkjet products, particularly in jurisdictions outside of the United States
where adequate intellectual property protection may not exist. In recent years, we and our competitors
have regularly lowered prices on printer hardware both to reach new customers and in response to the
competitive environment. Important areas for future growth include printer-based multi-function
devices in the office space, digital presses in our imaging and graphics space and driving color printing
expansion in the office. We believe we will provide important new contributions in the home, the office
and publishing environments by providing comprehensive solutions.
HP Financial Services. In our financing business, our competitors are captive financing companies,
mainly IBM Global Financing, as well as banks and financial institutions. We believe our competitive
advantage in this business over banks and financial institutions is our ability to finance products,
services and total solutions.
For a discussion of risks attendant to these competitive factors, see ‘‘Risk Factors—The
competitive pressures we face could harm our revenue, gross margin and prospects,’’ in Item 1A, which
is incorporated herein by reference.
Environment
Our operations are subject to regulation under various federal, state, local and foreign laws
concerning the environment, including laws addressing the discharge of pollutants into the air and
water, the management and disposal of hazardous substances and wastes, and the cleanup of
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