GigaOM » derrick-harris

Welcome back, Michael Dell: It’s time to reclaim your name

Om Malik — Wed, 06 Feb 2013 05:34:13 +0000

A lot is being said and a lot will be said about Michael Dell’s decision to take the company he started in 1984 in his college dorm room private (with some cash from Silver Lake Partners, Microsoft and other investors.)

People are also going to point out that karma is a bitch. Others will say that the cloud will prove to be the ultimate undoing of Dell, and that mobile is Roundrock, Texas-based company’s Achilles heel. I would agree with some if not all of those assessments. I would also be hard pressed to ignore the harsh reality of tech-land — turnarounds rarely turn.

And despite knowing all that, I cannot help but applaud Michael Dell, the founder.

Dell is doing what few people do — putting both his reputation and his fortune on the line in order to save and perhaps revive the company with whom his name and legacy will always be intertwined. This is high-stakes poker: he is putting millions of dollars of his own money in addition to investment from his investment firm, MSD Capital, on top of kicking in his stake in Dell.

He doesn’t need to do any of this. If someone else made the very same offer he is making for the company, he stands to be a few billion dollars richer. Dell is filthy rich and his empire is spread wide and far. There is a lot he can do with his time — politics for example. (If HP alums Carly Fiorina and Meg Whitman can think about political careers, why not Michael as governor of Texas.) The fact is that the next three to four years are going to be hell for Dell.

While the company has made some bets on cloud technologies, and there are ways (as Derrick Harris spells out in his article) out of this gloom, Dell is not on the sunny side of the street by any means. The big infrastructure buyers like Google and Facebook are looking to upend the server business. The battle for Dell is not just Lenovo and Hewlett Packard, but it is also Amazon, Microsoft, Cisco and Apple.

This is Dell’s Battle of Britain. This could be his finest hour or it could be him and his ego, like Butch Cassidy and the Sundance Kid’s last stand against the Bolivian army. Who knows.

So why do it? My explanation — you don’t really have a rational choice, so you make an emotional choice. As a founder whose name adorns the shingle outside the door, Dell is playing a high stakes poker to literally save his good name. Just the idea that some faceless Asian company would own “Dell” the brand and his name is anathema.

Every so often people say that its not personal, its business. Nonsense! It is always personal and it will always be personal. If you spend your lifetime nurturing and growing a startup, it is nothing but personal. Outsiders will never understand — for a founder, failure, defeat and ignominy are always personal, just as success and fame. For founders, our identities are intertwined with the companies.

Think of it this way — when you start a company and spend about 15 hours a day on the company, that is more time you spend with your family. I have more memories of my startup than I have of my own life. I can’t remember a single birthday over past seven years, but I can tell you who said what and when and why. And that is just us, a tiny little company. That is why I disagree with the theory offered up by the otherwise admirable Ashlee Vance at BusinessWeek on why Dell is doing what he is doing:

The worst-case scenario for Michael Dell would have occurred if an activist shareholder had gotten into the mix. Dell would have faced the prospect of being kicked out of the company that bears his name. I’m certain this is why Dell went private. Dell, Silver Lake, and Microsoft get a company that pumps out enough cash to keep all parties happy, while Michael Dell shields himself from being berated by analysts, investors, and the media. Best of all, he gets to keep his company.

Admittedly, my explanation is tinged with bias of a founder whose name hangs on the door of his shop. And yes, it is a bit of an emotional explanation, but I get it.

And that is why I want to applaud Dell and welcome him back to the founder fold — this is where it starts. Good luck… for you’ll need heaps of it on your mission impossible.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

Commutist podcast: Patent trolls, Costco ban and Passbook’s home run

Chris Albrecht — Fri, 12 Oct 2012 07:01:25 +0000

We kick off today’s show with patent trolls: scourge of the tech world, or are they just misunderstood? (Hint: they are not misunderstood.) Jeff John Roberts tells us about the troubles with patent trolls and what we can do about them. Want to know how to get banned from Costco? Derrick Harris says you just need to buy tons of hard drives, like the guys from BackBlaze did. And finally, Apple’s Passbook was a big hit with Major League Baseball fans, but how will smartphones impact America’s pastime? Tom Krazit brings it all home (you’re going to buy more stuff).

SHOW NOTES:

0:00:00 – 0:11:00 – Patent Trollin‘ with Jeff Roberts

0:11:00 – 0:12:00 – This episode is sponsored by the GigaOM RoadMap conference

0:12:00 – 0:22:00 – Backblaze gets banned from Costco

0:22:00 – 0:33:00 – Take me out to the ballgame… with Apple’s Passbook

0:33:00 – 0:36:00 – Parting gifts:

Tom recommends the MLB’s At Bat app

Erica likes Trover for previewing her travels

And for those with kids, Chris recommends the book “Goodnight iPad“

PREVIOUS EPISODES:
Commutist, meet Nerdist, and interview with Chris Hardwick

T-Metro, Broadband Caps, Remembering Steve Jobs

Apple’s iO-Mess, Dirty Data Centers and Tesla

News from the Mobilize Conference

Paul Tough: How Children Succeed and what you can learn from them

The iPhone 5 Event

Come on, Kindle, Light My 4G Fire

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

Why the big data startup boom will likely be short-lived

Paul Miller — Fri, 09 Dec 2011 01:44:19 +0000

There has been a remarkable flowering of companies over the past year or two, all riding a wave of developer and investor enthusiasm for the loosely defined concept of “big data.” But given that the big data startup market is probably overvalued and headed for a lot of consolidation, these new companies’ days might be numbered.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

Amazon makes public cloud more attractive to the enterprise

Paul Miller — Sat, 06 Aug 2011 19:00:42 +0000

On Thursday Amazon announced three enhancements to its cloud computing offering. These include improvements to existing virtual private cloud and identity management solutions as well as a new option to directly connect enterprise networks to machines in Amazon’s Virginia data center, as Derrick Harris recounts and Amazon’s Jeff Barr [...]

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

Despite growth in open source, commercial solutions still dominate

Paul Miller — Thu, 21 Jul 2011 23:57:17 +0000

Open-source cloud computing project OpenStack turned one this week, and cloud backup provider Backblaze freely shared detailed specifications for a storage device capable of holding 135 terabytes of data. Open-source options for everything from servers and data centers to clouds and application platforms are growing more robust. [...]

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

The Challenges of Moving Across the Entire Stack

Paul Miller — Fri, 20 May 2011 16:30:30 +0000

VMware has been on a roll recently, moving from its virtualization roots to acquire software as a service (SaaS) solutions such as SlideRocket and Zimbra, and even going so far as to launch an open-source platform as a service (PaaS) offering, CloudFoundry. This week’s announcement of Horizon App Manager, a dashboard to control enterprise access to third-party SaaS applications, is the latest addition to VMware’s increasingly rich portfolio, and led cloud analyst Ben Kepes to remark that “[VMware does] the entire [cloud] stack now.” To a certain extent, Horizon meets an enterprise need to control and gain visibility over SaaS products deployed throughout the organization, a topic I recently explored for GigaOM Pro (subscription required).

VMware isn’t alone in seeking to strengthen its market position by expanding far beyond the company’s original offering. With its Force.com platform, for example, Salesforce has created an environment upon which a growing number of developers build their applications. Those applications certainly extend and enrich the company’s core CRM product, but also meet customer needs in areas far beyond CRM.

The Leading Edge Forum’s Simon Wardley describes parts of the approach adopted by both Salesforce and VMware as a classic example of a “tower and moat” defense, in which the “principle here is to defend a revenue stream (the tower) by creating a moat devoid of differential value with high barriers to entry around it.” In other words, they prevent the competition from developing viable challengers to revenue-generating CRM products by filling the space with open-source or low-revenue products. There is no easy way for potential competitors to get close, especially when those competitors are companies like Oracle and Microsoft, which are more accustomed to the very different revenue models associated with on-premise installed software.

As companies like Salesforce, VMware and Amazon, which underpin the cloud, continue to grow, the range of products they offer will necessarily expand. Some of those products are intended to provide new revenue-creating opportunities, while others are simply there to squeeze the competition. But as they become more important as platforms upon which others build and depend, can any of these companies successfully continue to pursue their original product-based strategies? Whether they must inevitably become one or the other remains to be seen.

But as these companies make the transition to become platforms, they must steer a careful course that balances the growing utility of being a platform upon which others can build — and compete — with a continued desire to add features to the core product. The risk of internal conflict between teams wanting to add features to a core product and teams wanting to enable others by adding those features to the platform is, perhaps, very real.

For more on the challenges facing companies that try to dominate the cloud computing stack, see my latest Weekly Update for GigaOM Pro (subscription required).

Image courtesy of flickr user mrs.tom

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

The Debate Over Definitions Rages On

Derrick Harris — Sat, 18 Apr 2009 14:00:23 +0000

Just when you thought it was safe to go back into the water, the debate over the definition of cloud computing has reared its ugly head again. From panelists at the recent VoiceCon event to GigaOM guest contributor (and AT&T VP) Joe Weinman, everyone’s trying to define the cloud to meet their purposes. The venture capital community has jumped into the fray as well, and a new report from McKinsey added fuel the fire. Derrick Harris rounds up the various definitions at play this week, and points to some of the problems they present.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.