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Dell set to unveil cloud plans

Cliff Saran

Dell is due to make a global announcement later today, where it is expected to unveil its plans for cloud computing.

Dell says its strategy will deliver "solutions and services for the virtual era."

Product areas affected include Dell Compellent, Dell KACE and Dell Secureworks.

In 2009, Dell acquired Perot Systems for $3.9bn (£2.38bn). The acquisition gave Dell a step up into the services market, thanks to Perot's big reach in the US Healthcare and government sector.

However, Dell has yet to put in place a viable alternative to HP (with its $13.9bn acquisition of EDS in 2008) and IBM (which acquired PriceWaterhouseCoopers) for delivering services globally.

As reported in the CW+ special report on Dell, with 23,000 employees, Perot is strong in healthcare (48% of revenue) and government services (27%), which is why Dell's services revenue soared by 116% in its public sector business during the second quarter of fiscal 2011.

With 88% of its revenue hailing from domestic markets, it is also heavily biased towards US customers.

Dell therefore needs to increase its service industry acquisitions to flesh out other areas, especially if it wants to compete with heavy-hitters such as IBM and HP.

The former purchased PriceWaterhouseCoopers, while the latter purchased EDS, which coincidentally was started by Perot.

In a bid to bolster its rapidly-growing services operation, Dell will also likely be looking for potential targets with a strong regional presence outside the US.


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