Talk about a market disruption. In some scenarios, GroundWork Open Source says the company’s IT monitoring software costs 82-percent less than Hewlett-Packard Operations Manager and Network Node Manager. Apparently, Hewlett-Packard is fuming mad over the price comparison.

Matt Asay, over at The Open Road, offers a blow-by-blow account of the GroundWork vs. HP feud. It’s a fun read — and it highlights why Hewlett-Packard’s network management software team needs to rethink their entire business and channel strategy.

Whether it’s HP OpenView, Operations Manager or Network Node Manager, the company is under attack from simpler, lower-cost solutions.

GroundWork and Nimsoft both have scored multiple software victories over HP in recent months. And some HP OpenView partners have made the leap to GroundWork. Even worse, HP has completely overlooked opportunities in the managed services market — where Dell recently won a $20 million SaaS (software as a service) contract with the State of Georgia.

Of course, there’s no need to press the panic button at HP. Wall Street remains impressed with HP’s management. And HP continues to deliver generally solid results during a brutal economy.

Still, HP needs a clearer, far stronger response to open source and managed services platforms. Instead of complaining about GroundWork publishing HP price lists, HP should solve its pricing problem.

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