Hidden costs of a Dell

Dell has a well-deserved reputation for value. However, they're making their money on enterprise markets, not on the $299 specials you see advertised.
Written by Christopher Dawson, Contributor

Dell has a well-deserved reputation for value. However, they're making their money on enterprise markets, not on the $299 specials you see advertised. That includes educational markets, which don't have access to the amazing deals available through Dell's Home and SOHO sites.  The $399 laptops we see in Dell's banner ads sound great, especially in education, where we are often very willing to trade performance for price.  However, these bargain basement machines are rarely available in quantities greater than one and often lack features we need to effectively run enterprise information systems.

Most strikingly, these systems all come with Windows XP Home Edition which simply lacks the networking and security features that most of us consider essential.  Even if Dell would allow us to buy more than one system at this price, we're still looking at $60-70 a piece for a volume academic upgrade license (or an extra $100-130 a piece through the website).

So let's say you bypass the Dell Home website and contact your educational rep there.  These folks are fast, friendly, and helpful.  However, the prices, while still competitive, can certainly make for a bit of sticker shock when we become used to Dell ads.  The best unit price I was quoted yesterday for 25 Dimension mid-towers (no monitor, 2.53GHz Celeron, XP Pro, 1GB RAM, DVD player, standard networking, integrated sound and video) was $542.  Considering that this includes a 3 year warranty plus a few component upgrades, it's not too bad.  Similarly, the convenience of being able to pull the machine out of the box, toss it on a desk, and fire it up counts for a lot.

There are alternatives to Dell, however.  Aside from the other major OEMs, budget sites like TigerDirect, NewEgg, and even CDW (which actually has a government/education division that provides discounts to our sectors) offer barebones systems, kits, cases, and components that may provide considerable cost-savings if you and your students are willing to invest the time and effort into putting together systems.  The biggest cost here may actually be software licensing if you choose to use Windows.  As the performance of your system increases, a "roll your own" approach may save you more and more money.  Open source software, of course can save you even more if you have the expertise to run and administer the systems.
This will begin a series this weekend and next week on rolling your own in a K-12 environment.  I'm also going to take a look at Intel's $400 Eduwise and the OLPC prototype for American students.  We need to balance low cost of entry with low TCO if we want to realistically think about lifecycle funding.  Do Dell, HP, and the other major Wintel brands hold the answer?  White boxes?  Or do we need to look at something radically different?

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