Dell starts shifting away from consumer tech to enterprise focus

Dell starts shifting away from consumer tech to enterprise focus

Summary: As Dell lowers its financial outlook for the next quarter, it's also moving away from pushing consumer technology.

SHARE:

Dell posted decent results for second quarter earnings on Tuesday, but its outlook for Q3 2011 is disappointing.

If the Round Rock, Texas-based computer maker has been forced to drop its revenue expectations from 5 percent to 9 percent down to between 1 percent and 5 percent, obviously something is wrong and Dell needs to rethink its priories.

See also: Dell cuts sales outlook, cites 'uncertain demand environment'

Speaking during the company's quarterly investors call on Tuesday, chief financial officer Brian Gladden spoke a bit about the "ongoing shift to higher value Dell technologies."

We continue to eliminate lower margin business that's not strategic to the Company long term. Specific examples of this include exiting lower value reseller business in both storage and software as well as unfavorable retail and reverse auction deals in our client business.

More specifically, Gladden said that the U.S. consumer market "has been weaker than we expected." Much like Cisco, Dell appears to be making a major move to redirecting more of its focus and resources towards enterprise clients.

Brad Anderson, senior vice president of Dell's enterprise solutions, explained some of Dell's enterprise strategies, breaking them down into two key areas of focus:

First is next generation computing solutions and architectures that address key customer needs, solutions that are easy to implement and manage, that address physical and virtual management holistically and extended adoption for key technologies by packaging the right functionality and intelligence to drive ease-of-use.

The second key area of focus is intelligent data management, which is developing an architecture that unifies storage subsystems both block and file and alters advanced functionalities that can be used across them and across the data life cycle. By coupling our unified ark with our intelligence policy, we can dramatically simplify and automate data movement and access while optimizing cost.

None of this means that Dell is abandoning consumer products altogether. After all, CEO Michael Dell still iterated his company's interest in Android as well as Windows 8-based tablets.

Nevertheless, consumer goods have continued to bleed most companies dry this year. If axing of the Dell Streak 5 is any sign, Dell has realized that it needs to trim some excess (read: unprofitable) products if it wants to keep posting earnings instead of losses and boost its outlook back up.

Related:

Topics: Tablets, Banking, Dell, Hardware, Laptops, Mobility

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

8 comments
Log in or register to join the discussion
  • RE: Dell starts shifting away from consumer tech to enterprise focus

    If I owned Dell, I'd sell the company and give the money to the stock holders.
    gtdworak
    • That doesn't make sense.

      The stockholder are "the owners" of the company, so, if Dell were to be sold, it would be the stock holders that would get the proceeds from the sale.

      Your statement is equivalent to a pizza shop owner saying that, if he "owned" a pizza shop, he would sell it and give the money from the sale to the pizza shop owner, which is simply himself.

      Now, is Dell still making money? Or at least breaking even? With either case, it would show that there is stilll hope for a recovery by the company.

      However, the problems with companies such as Dell and others that depend on any kind of sales, is that, the economy is in a downturn, and the consumers are not spending their money and are saving it or just spending on the more important and immediate necessities.
      adornoe
      • RE: Dell starts shifting away from consumer tech to enterprise focus

        @adornoe@...

        I was being sarcastic. I was twisting a statement Michael Dell said about Apple when Apple was on the ropes and close to going under.
        gtdworak
      • RE: Dell starts shifting away from consumer tech to enterprise focus

        @gtdworak

        Still a typical tiresome useless little boy comment. Get a life.
        Lester Young
      • gtdworak: Whatever, but Dell would still not have made the statement

        to sound so "illogical".
        adornoe
  • RE: Dell starts shifting away from consumer tech to enterprise focus

    Dell never had a real consumer focus in the first place.
    Lester Young
  • Good - Dell stinks in the consumer space lately

    Maybe they will spin off Alienware and it will return to its former glory.
    Garrius
  • RE: Dell starts shifting away from consumer tech to enterprise focus

    I just bought my last Dell. One of eleven. I am sure the PC is adequate but the suport and documentation which was once King has become non-existant. Sun is going to have them for lunch - and rightly so. -Richard Stickney
    stick4013