Dell transforming into service company

Dell's acquisition of US IT services company Plural is a logical step following its success as an enterprise server vendor,...

Dell's acquisition of US IT services company Plural is a logical step following its success as an enterprise server vendor, according to analysts.

Dell recently joined the ranks of the top five server vendors in the world, taking the number five spot behind IBM, Compaq, Sun, and Hewlett-Packard for worldwide server market share by revenue, according to analyst group IDC.

"Dell is emerging as a very serious competitor in enterprise server platform business. And, for a company to compete seriously in that segment, it is very useful to have a professional services capability," explained Bill Martorelli, the vice-president of enterprise services at analysts Hurwitz Group. "They are viewed as a very significant competitor by the giants of the server business, and professional services is part of the winning formula."

Dell has an existing IT service agreement with IT service company and server maker Unisys and will add the capabilities of Plural to that mix. Plural specialises in consulting, application development, and integration.

"[Plural] adds to the capabilities we already have, particularly since they specialise in Microsoft consulting and application development," a Dell spokesman said.

Andrew Efstathiou, program manager for technology management strategies at researchers Yankee Group, said Dell's services business is far from being serious competition for the services operations of rival hardware vendors IBM and HP.

"Dell is just starting and it is going to take a year or two to see if they have done it right," Efstathiou said. "They have to build the business organically and acquire some more services firms; I don't think one will be enough."

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