So it’s finally baked: Dell Technologies is here, having closed the most audacious raid in technology M&A history with the purchase of EMC. The new company, or so the press release here contends, is a $74bn confection built up from ingredients that belong to SME computers and direct marketer Dell and the EMC clan including VMware, Pivotal and RSA. Now who is going to have a slice of this big cake?
Michael Dell built his eponymous company on the notion that a commoditising computer industry required a slick supply chain and a direct relationship with the customer. The company he will now lead is built on very different and complex foundations and the core of EMC is aimed squarely at the world’s largest enterprises. If Dell can make a success of the new enterprise he will surely take his place on the podium with Steve Jobs (of Apple which Dell frequently used to mock) and his hero Sam Walton as a great American business leader capable of self-reinvention as well as original success.
Dell is betting the farm on one big idea: that the world is changing and accelerating into a digitally-centric, cloud-first future where businesses will want to buy from powerful but flexible stack providers that can rebalance the old conundrum of best-of-breed versus one-stop shop. In short, he wants to give buyers a rare opportunity: you can have your cake and eat it too.
The obvious rivals here will be the great all-rounders of the past: IBM and Hewlett-Packard. Dell’s timing is either fortuitous or well planned as both these companies are themselves crunching through the gears of change.
If you think Dell can win in this high-stakes game then you might point to both Dell and EMC having excellent reputations for business management, operations and sales. Against that you might look at the fact this is an all-American deal in an age where globalisation is a leitmotif. Given the chutzpah already shown, perhaps another deal to bring in an Asian telco or service provider could follow?
Whatever happens next, one thing is certain: the future of Dell Technologies is a sure-fire bet to be written up in business case studies for years to come.
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