Dell's acquisition of KACE: A smart move

Dell acquired KACE, which makes systems management appliances, for an undisclosed sum and the deal adds up on many fronts.

Dell on Thursday acquired KACE, which makes systems management appliances, for an undisclosed sum and the deal adds up on many fronts.

Andrew Nusca has the breakdown of the deal and Dell's statement outlines the following:

  • Dell intends to use KACE to better target midsized businesses;
  • KACE's appliances are aimed at midsized companies and public institutions;
  • These appliances find devices, take systems inventory and manage IT assets;
  • Smaller companies with less than 5,000 PCs find these KACE devices handy because they just don't have the time or will to do systems management chores.

So why does this deal add up?

Strategically, KACE fits in well with Dell's plan. For starters, KACE's verticals (government, education and healthcare) align nicely with Perot Systems, a services outfit recently acquired about Dell.

See all resources on KACE.

But more importantly, KACE can help Dell pluck off a lot of business among small and mid-sized businesses. A few market observations:

  • Mid-sized businesses (also think large SMBs) have poor systems management so there's a market need.
  • HP and IBM have full suites of systems management tools that are geared toward larger enterprises. Simply put, your typical mid-sized business doesn't need these big suites.
  • Dell can make KACE appliances more efficiently.
  • Dell already had established relationships with smaller companies and can move KACE gear.

Add it up and Dell-KACE is a nice combination that could pluck a lot of low-hanging fruit in the mid-sized market.

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