I recently had the opportunity to attend DellWorld 2014 in my hometown of Austin, Texas. One year after going private, Dell seems, at least to this outside observer, to be filled with excitement and optimism for the future. The positive atmosphere comes as a welcome change from what seems to be a sea of turmoil encompassing the remaining server-storage players in the IT market these days. HP recently announced plans to split the company into two, separating the consumer and enterprise pieces. This news comes in the wake of IBM selling its X-series server business to Lenovo. The list of end-to-end IT providers is rapidly shrinking.Dell seems to be sitting in an optimal position to capitalize and gain some share, but can the newly private company execute? That is one of the top questions of 2015 and something to watch over the next four quarters.
For now, Dell is saying all the right things. The keynotes at DellWorld featured thought provoking discussions on the direction of IT. The flow of the expo focused on solutions such as big data and cloud instead of being segmented by corporate divisions such as server and storage. Does this mean a leaner and meaner private Dell is ready to take IT by storm and get its mojo back in 2015? There are two places to watch over the coming quarters to help us answer that question.
- Enterprise innovation versus partnership strategy: Dell has made some news in recent days by partnering with Nutanix and then shortly there after partnering with VMware on EVO: RAIL. As the industry looks to the software-defined data center as a potential future, Dell offers a smorgasbord of offerings, adding Nexenta, Microsoft Storage Spaces, and Openstack Swift into the mix as well. While the breadth is impressive, the noise around partner technology is drowning out what is happening with some of Dell’s own intellectual property, e.g., Compellent and EqualLogic. Also, Dell’s innovation looks to be more on the hardware side as the modularity of the PowerEdge FX2 shows that Dell still has some smart engineers in the building, but does Dell plan to deliver a software-designed offering from its own IP? In 2015, we will have a much better picture of Dell’s long-term strategy. Will innovation be isolated to the hardware side of the house, positioning Dell as a hardware arms-dealer to the software defined players, or does Dell have its own software-defined offering up its sleeve?
- Software pieces coming into place: The Quest software acquisition could have been described at the time as the corporate equivalent of winning a storage container at a warehouse auction with the conglomerate’s myriad of different technologies, targeting multiple and sometimes overlapping markets. Now, two years later, the pieces seem to be falling into place, and Dell has transitioned from just trying to understand what technology it has in its arsenal to delivering some strong solution offerings. But can the traditional hardware manufacturer transition to a more software- and solution-centric business? More clarity on Dell’s potential as a software and solutions provider will hopefully materialize in 2015.
The next 12 months will be an interesting time in IT and for Dell. Remaining an end-to-end player seems to be a key part of Dell’s strategy. As Michael Dell said in his keynote address, “To provide end-to-end solutions, you need both ends, or it is the end." But when you offer almost everything, you have to pick and choose where to innovate, where to partner, and where to lead. I for one am excited to see which choices Dell makes.