Michael Dell finding that karma can be tough

With Dell's strategy in question and Michael Dell's corporate privatization plans still in limbo, longtime Apple watchers wonder if there's a "curse" involved with the company after a fateful speech some 16 years ago.

According to the latest reports, Michael Dell recently said that he will stay with the company even if his plans to take Dell private don't succeed. He said he is "ready to fight and I am committed to doing what I believe is right for the company."

Michael Dell has long been quick to tell the market "what's right" for a company. In October 1997, at ITxpo, Gartner Group's long-running IT analyst conference, Dell was asked what he would do if he were Apple's CEO. Steve Jobs had returned to the company early in the year and only a few months before had taken over as interim CEO.

"What would I do?" he said. "I'd shut it down and give the money back to the shareholders."

This drew a big laugh from the PC crowd. Apple was mostly a computer system maker with a declining market share, less than 5 percent. And Dell was riding high from the success of its its direct-sales model.

However, Dell appears to be less than quick to take his own advice when its his company on the receiving end of trouble.

Since then, the high-flying Dell hasn't exactly soared. Its hardware quality kept declining as the company tried to squeeze profit from ever-thinner margins.

In a fall 2007 briefing, Michael Dell and corporate executives presented a vision for "Dell 2.0," saying that the company would be a leaner, meaner, selling machine. Mark Jarvis, then Dell marketing vice president, said that "Apple has become the conformist company."

Instead, Dell would be the "different company," he said, borrowing a bit from Apple's then-fading "Think Different" advertising campaign from the late 1990s. Of course, he couldn't provide much detail of how this difference would be achieved.

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In 2010, despite the Version 2.0 reset, Dell settled a lawsuit that it had knowingly shipped millions of faulty computers and then concealed those problems from its customers. The primary cause of the problems were overly-cheap capacitors.

Also in the fall of 2010, Michael Dell himself and the company settled with the SEC on charges that both had taken hidden payments from Intel to not use AMD processors. In addition, the company had used fraudulent accounting practices to meet analysts' targets.

To a baseball fan as myself, I would suspect a "curse," such as the infamous Curse of the Bambino," which was blamed for the failure of the Boston Red Sox to win the world series from 1918 to 2004, an 86-year period. It was due to the sale of Babe Ruth (called the Bambino) to the Yankees. This is the Curse of Apple.

Why anyone believes that Dell can make a go of its Dell 3.0 or Dell 4.0 strategy, move out of its commodity PC business and make a success as an enterprise technology player providing expensive, high-margin hardware, software and services, is an open question.

At the Monday Note blog, Jean-Louis Gassée said that Microsoft may come to the rescue and help take Dell private, forcing it to keep producing Windows PCs.

Or maybe there’s another story behind Microsoft’s beneficence: The investor syndicate struggles and can’t quite reach the $22B finish line. Microsoft generously — and very publicly — offers to contribute the few missing billions. Investors see Microsoft trying to reattach the PC millstone to their necks — and run away.

Hats off to Steve Ballmer: Microsoft looks generous – without having to spend a dime – and forces Dell keep making PCs.

Or perhaps all the deals will fall apart. After all, Dell appears to be operating under a "curse."