Dell CEO: Direct Model Is Religion

Many of your competitors have been building their product and technology portfolios. Dell has done little if any of that in the past. Do you envision that changing?

No, we have not been very acquisitive, and were not sure thats the best way to create value for customers. You can see what weve done more aggressively is partnerships. And so the Dell-EMC [Corp.] relationship—very renowned, very successful.

Everybody acknowledges that weve got partners who are printer suppliers. Those work very, very well, provide us with great technology. Weve come from like nowhere into the printer business in two years. So we feel that using partnerships is probably a better way than to try to acquire companies so that we can build our partners and not have to make the big investment of an acquisition, since most acquisitions are not successful anyway.

Bottom line, acquisitions are pretty tough to do, and were not really thinking about acquisitions right now.

You touched upon the Dell-EMC partnership. The storage market is a large one out there, theres a lot of heterogeneous storage environments, why is the Dell-EMC relationship so exclusive? Why isnt Dell looking to partner with anyone else?

You cant really partner with too many. You need to stay with one team and build them out, and if youre going to proselytize a technology, youve got to kind of stick with it. You cant tell a customer they should do five different ones and they should be switching back and forth.

They want stability in the enterprise, stability in the data center, and EMCs got a fantastic brand name, and theyve had great technology. Their challenge has been that theyve not had great access to the middle market or to mid-range storage, so we have the ability to bring that in.

So Dell storage is in there, too—both tape backup [and] direct-attached storage—[and] fills out the entire product line, high, medium and low. Thats been our strategy, to plug another one in there, wed basically have to cut the volumes in half and wed have a confusing story to customers.

So rather than just give them choice, you want to give them efficiency?

Yeah, we want to give them our best. We think EMC is the best product out there by far, so thats what were working with. Then were taking customer feedback to EMC, so jointly were developing new products, new roadmaps—working with them to make that the most successful partnership.

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