Dell is expanding its data center capabilities, buying Gale Technologies for its infrastructure automation software and announcing a new business unit that will focus on integrated converged and enterprise IT solutions.
The announcements come a day after Dell executives released the company's third-quarter financial numbers, which showed the vendor making good strides in its transformation efforts to become more of an IT solutions provider but also how Dell is still being dogged by the flagging PC market.
The acquisition of Gale, a 4-year-old company, and the creation of the Enterprise Systems and Solutions group, announced Nov. 16, falls in-line with the acquisitions and internal moves Dell has made as it looks to build up its storage, networking and software capabilities to add to its server expertise.
"As customers increasingly move to fully integrated solutions, we are favorably positioned to capitalize on these trends with industry-leading server, storage, networking, and software assets coupled together as end-to-end systems," Dario Zamarian, vice president and general manager of the new Enterprise Systems and Solutions unit, said in a statement. "In creating this new organization, we plan to accelerate our ability to deliver differentiated value to customers—providing them with improved operational efficiency and the right balance of capability and price."
Like most top-tier vendors with deep ties into the PC market, Dell's overall financial numbers have taken a hit as worldwide sales of PCs have slowed in recent quarters, thanks in large part to the uncertain global economy and the rising popularity of tablets and smartphones. They also were hampered by the anticipation around Microsoft's release of its Windows 8 operating system, but now that the OS is available, it's still unclear whether it will be enough to bolster the PC industry.
In the third quarter, Dell's income fell 47 percent from the same period last year, to $475 million, on revenue of $13.7 billion, an 11 percent reduction. The company's PC sales fell 19 percent, to $6.6 billion, during the quarter. However, Dell's revenue for its servers and networking business grew 11 percent, Enterprise and Solutions group jumped 3 percent and Data Center Services rose 126 percent. Services growth also was strong, officials said.
In October, Dell unveiled its Active Infrastructure converged data center offering, which provides compute, storage, networking and management software in a single solution similar to what Cisco Systems—with its Unified Computing Systems (UCSes)—and other vendors sell.
The latest moves will build off those integrated IT solutions efforts. With Gale Technologies, Dell gets infrastructure automation software capabilities that let users take discrete compute, networking and storage products and turn them into more tightly integrated solutions for applications, virtual desktop infrastructures (VDIs) and private clouds. Through Gale software, businesses will get broad management, automation and orchestration capabilities that will enable them to provision resources across heterogeneous infrastructures, both physical and virtual, according to Dell officials.
The software will let businesses extend their existing IT investment into new areas, such as private and hybrid clouds.
"Today, enterprises need solutions that enable operational benefits of speed, efficiency, and flexibility in the allocation and use of resources," Marius Haas, president of Dell's Enterprise Solutions Group, said in a statement. "Gale Technologies integrates well with our Active Infrastructure family, and provides an intuitive, flexible and comprehensive foundation for application, virtual desktop infrastructure and private cloud deployments for our customers."
Along with the acquisition, Dell officials also unveiled a new software product based on Gale technology that will complement the rollout last month of Dell's Active System Manager management tool. With this new product, businesses will get an infrastructure as a service (IaaS) platform that will offer automation and orchestration of applications, VDI and private clouds across infrastructures using VMware's vSphere and Microsoft's Hyper-V virtualization technologies. The software will be available on Dell's current vStart systems and upcoming Active System 800, due in early 2013. It later will support third-party infrastructure offerings, according to Dell.
Dell officials said they plan to keep Gale's employees and will look to grow the business by investing in engineering and sales. No financial details were released.
The new Enterprise Systems and Solutions organization will be tasked with designing solutions that enable businesses to address complex environments and deploy the products quickly. It will design infrastructure models that can be easily repeated, are prebuilt and can be assembled either by Dell or the customer. The new group also will create a single framework that will help businesses manage complex topologies, from server and storage resources to network connectivity to software images.