All: a little glimpse of what awaits Intel's bottom line 2H98:
4-8 Way Servers
(04/27/98; 4:27 p.m. ET)
By Tom Davey, InformationWeek
Dell Computer's low-cost,
direct-distribution business model has
driven the company's booming sales and
low pricing, contributing to the intense price
competition in the PC market. Dell last
week stepped up its efforts to drive more
aggressively into the server market by
unveiling the PowerEdge 2300 workgroup
server, its first server based on Intel's new
350-MHz and 400-MHz Pentium II
processors. The server starts at about
$3,200.
Chairman and CEO Michael Dell recently
discussed the server market and other
topics with InformationWeek senior editor
Tom Davey. Here are excerpts from that
interview.
How rapidly will Dell move to the
higher end of the server market?
With the Slot II announcement, we will
be there with a strong enterprise
data-center-oriented solution, along with
multiterabyte storage that will facilitate the
trend toward server consolidation. We're
going to start with a four-way system. Like
a lot of companies, we are waiting for
eight-way technology to become more
mainstream [with Intel's eight-way
processor boards due late this year].
How widespread do you think the
server consolidation trend is among your
customers?
I think with large customers, its huge.
What's happening with servers is what
happened with PCs, when PCs started
popping up all over the enterprise. You
have chaos. Now companies are looking to
ensure data integrity, backup, reliability --
and having several hundred servers sitting in
closets all the way around an organization is
not the way to do it. So we're looking at
delivering "rack-dense" server solutions
with the right storage and performance.
Which are the fastest-growing areas of
your R&D budget?
The R&D budget is growing in
desktops, but not as fast as in servers and
storage, because those are new areas.
[Sales of] notebooks, servers, storage, and
workstations last year together were about
33 percent of our revenue. And we'd
obviously like to drive that in the next
couple of years to more than half our
revenue.
Do you have big plans for the Unix
market?
Yes -- it's called NT. We like to think
of ourselves as going where the puck is
going to be, and I think it's going to NT.
[Dell also sells servers that run Unix. -- Ed.]
Your online sales have attracted a lot
of attention. To what extent are major
customers actually buying over the Web,
and how does the Web affect the sales
process?
The role of the salesperson is not
going away; it's changing. We've created
premier Web pages with our 2,000 largest
customers, and an increasing number of
them are actually ordering online, although
it's still a small percentage. What they are
mainly doing is getting information online.
They're using it to implement their IT
standards. We put online all the elements of
the relationship -- who the Dell contacts are
in every country, the product road map,
pricing, the support they have acquired.
That makes the role of our sales and
support people really much more
consultative and problem-solving. |
