8 Comments

Summary:

Without the nagging distractions of shareholders, will Dell be able to execute on ambitious cloud-and-services plans to grow beyond hardware? As of today, we’ll start finding out.

Michael Dell
photo: Dell

You can take Dell off your stock watch list as of today. The server-and-PC company is now privately held after a bitterly contested battle that featured appearances by Carl Icahn and and dragged the names of potential new CEOs into the mix.

Now with that $25 billion worth of boardroom drama out of the way, it’ll be interesting to see if the company can deliver on plans to offer more (and more profitable) business services and cloud infrastructure. It’s not an original plan — rivals Hewlett Packard and IBM are already neck-deep in services for corporate customers, but it’s clear that all the hardware players need to diversify into potentially more margin-rich software and services.

Dell was already pushing a clouds (plural) strategy centered on an OpenStack-based private cloud plus a multiple-choice public cloud with three Dell-sanctioned public cloud options — from Joyent, ScaleMatrix and ZeroLag. Early last year, Dell decided not to offer an OpenStack-based public cloud because it claimed customers want choice, not lock-in.

Still, some (including yours truly) think Dell should just buy Joyent, which fields well-regarded cloud infrastructure with some blue chip customers — and make that its public cloud option. Dell reportedly already owns a piece of the San Francisco-based cloud provider. But I digress.

Speaking at Gigaom’s Structure:Europe conference last month, Nnamdi Orakwue, Dell VP of software, said the public-to-private transition would not change its cloud game plan.

Now we’ll see if the company — slammed for missing the smartphone-and-tablet revolution — can be a major player in cloud. But remember, it’s got to contend not only with Amazon’s public cloud, which seems to be eating the world, but with clouds from HP, Rackspace, IBM, Red Hat and others. It doesn’t look like the world of cloud computing will be any less cutthroat than that of PC and server hardware.

  1. going back underground …. and it makes total sense to do this transition in a much more flexible operating environment.

    Share
  2. Jeff Schneider Tuesday, October 29, 2013

    Barb,
    Other than the acquisition of Enstratius, which element of the Dell cloud strategy do you find most impressive?

    Jeff

    Share
    1. i hear great things re. boomi but i need to really study how all these pieces fit. What’s your take @jeffschneider?

      Share
      1. From a revenue capture and entry into SMB/SME, you’d have to take note of the Quest portfolio. Agreed – the Boomi market seems to be growing, although I can’t comment on Dell’s respective win-rate. As an “arms supplier” to CSP’s, I think they will have an up-hill battle generating revenue from OpenStack components, fighting (or embracing) Open Compute and generally ‘winning the hearts and minds of developers’. I’m assuming that they will have an OpenStack entry into the Converged Infrastructure space soon enough. On the ProServ side, it’s unclear to me what their differentiation is. Dell has the potential to be a significant player in next-generation I.T., however, I’m unclear how the pieces fit together. – – Jeff

        Share
  3. Jesse Proudman Tuesday, October 29, 2013

    Really looking forward to seeing what Dell does in its new configuration.

    – Jesse

    Share
    1. Brian McCallion Tuesday, October 29, 2013

      Boomi was a good acquisition. I see a lot of interesting strategic developments at work at Dell.

      Share
  4. I was very surprised to see Dell walk away from creating a public cloud. Maybe they simply had too much going on at the time to build a public cloud out. Now that they are private maybe they can devote the resources to get it done, or buy someone like Joyent as mentioned.

    I don’t see how they are going to be able to compete with HP and IBM without having an I-a-a-S platform to build off of. The way I see it, having IaaS is simply the “table stakes” you need to have to even play the game.

    Share
  5. It is all smoke and mirrors to have MSFT sink its talons into Dell deeper and to promote their agenda …. Msft cloud, msft mobile and msft platforms all under the umbrella msft solutions/services. In the long run Dell should (may) run all of MSFT’s public cloud hosting infrastructure. either way we cannot confirm or deny this as they are private now…

    Share

Comments have been disabled for this post