SS, IMHO, soon DELL will add
more service capabilities (eg. through an alliance with IBM) and go after the high
end enterprise storage market.
That's fine. Extremely hot product areas, like EMC is in, always attract more competition. Off the top, though, I'd say EMC has a lead of at least five years in enterprise storage in architecture and hardware development, software development, and reliability, availability, serviceability and scalability development. How does Dell catch up with that? IBM can't do it for them.
Last year DELL spent over $300M on R&D and received hundreds of patents.
First, patents are a dime a dozen. Well not exactly, but I've rarely seen one turned down that was submitted.
Sorry, but 300 million in R&D is a drop in the bucket for a company the size of Dell. That's, what, 2.5% of revenues? That's what Dell's annual report says for R&D expenditure last year, as a % of revenues. That is extremely low. The serious companies spend 10% and up.
I seriously think Dell sees the handwriting on the wall, that PCs, workstations and servers have become a cutthroat commodity business, and they are therefore desperate to diversify. EMC, Sun and Cisco, OTOH, have a very high percentage of their businesses in IP areas where they are going to be very hard to touch. Actually, I like Intel more than Sun from this viewpoint, especially when their 64 bit processors come out.
Tony |
