Dell keeps hopes up with enterprise business

Its enterprise business remains a profitable segment, but Dell won't be satisfied until it's a worldwide leader.
Written by Jeanne Lim, Contributor

SINGAPORE--Asia's nascent IT industry is good news for Dell Computer, which has seen its region's direct-attached storage business take off in the past year, says the computer maker's head of enterprise business.

Brad Anderson, senior vice president of Dell's product group, told ZDNet Asia last week that the hardware maker sees the Windows/Linux-attached storage business "as a huge upside" for its enterprise business portfolio. Anderson was in town as part of a high-power Dell executive entourage that included company founder and chairman Michael Dell.

While the company was unable to provide specific revenue numbers by product type, its latest financial report, released last week, showed that its storage revenue in the Asia-Pacific region, including Japan, grew 30 percent for the second fiscal quarter of 2007 to reach US$500 million, compared to the same quarter last year.

Windows/Linux-attached storage is typically made up of low-end storage boxes directly plugged into Windows- or Linux-based servers. Within the entry-level category, Dell offers its ML6000 tape modular tape library products, MD1000 modular JBODs (Just a Bunch Of Disks), AX100 and AX150 external storage arrays, and networked-attached storage products (NAS).

Dell also resells a higher-end range of networked storage devices from EMC.

Although its storage business is thriving, Dell is not about to ignore its server business. Citing IDC figures, Anderson said that Dell presently ranks number one in the United States with 23 percent market share and second worldwide, with 20 percent market share in the server segment.

"We're not satisfied till we're number one [worldwide]" he said.

Dell's enterprise business portfolio includes storage, workstations, servers and networking, associated services, and software and peripherals, which comprise about 39 percent of the company's overall revenues. This figure excludes desktops and notebooks that are purchased by enterprises.

According to Anderson, enterprise business is a "profitable segment" for Dell.

A beleaguered PC business notwithstanding, the company managed to grow its worldwide enterprise revenue by 11 percent, led by storage revenue which was up 36 percent year-on-year in the second quarter.

Consistency is key
With Dell PowerEdge servers in their ninth generation, the company is shoring up its efforts on having a "direct relationship with customers", said Anderson. As a result of this direct customer dialog, Dell has managed to put "tens of enhancements" to the latest generation of PowerEdge servers, he said.

Much of the enhancements went into keeping the commonality, consistency and continuity across customers' experience in the usage of the servers, he noted. Anderson further explained that this even drills down to putting common hard drives across all server platforms, and designing the servers such that the orientation of drives are in the same place across all the server products.

The consistency message is extended even to Dell's change process, where the company releases product updates simultaneously across all platforms to reduce the number of changes customers have to make, he said.

"In our last generation of servers, we made only three changes," Anderson said. "Our largest competitor had 20 changes over the same platform."

Fostering customer relationships is something that Dell will focus on heavily, he added, pointing out that early this month, the company extended its services offerings with its Platinum Plus service for enterprise customers.

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