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Here's an interview with M.Dell from SmartMoney magazine, March issue.
We caught up with founder and CEO Michael Dell to ask him about the year ahead.
Q: What will drive growth this year?
A: The deployment of broadband communications, or cable modems, which bring home
more access to the Internet. Over half the people who get a broadband line replace their
PC within one year. Of course, more people online means more Internet commerce, and
so more servers.
Q: What about overseas?
A: Europe is as large as the U.S. in terms of population but has half the number of PCs.
Last quarter we grew revenue 68 percent in Europe year over year, and in seven
countries we had more than 85 percent growth. In Asia, we grew last quarter at 49
percent, despite the economic turmoil.
Q: What do you think of your competitors' attempts to copy your direct-sales model?
A: Any company that tries to switch to direct sales is a prisoner of its own history. They
have to build new capabilities and skills that they don't have, and at the same time,
they're running the risk of alienating their customer relationships, because the dealers
are serving those. And the dealers, disappointed that they're no longer representing
these products, start selling competitive brands or their own products.
Q: So what's your biggest challenge this year?
A: Keeping pace with the growth. Our 1998 revenue is coming in on the order of $18
billion. The year before we did $12 billion. So adding about $6 billion a year in terms of
infrastructure is a real challenge. But we have an economic engine that allows us to
deliver products at a cost and service level that our competitors are unable to match.
--Bill
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