IBM in talks with Dell, Lenovo about offloading x86 server business

Dell is rumoured to be in talks with IBM about purchasing the x86 server family. Lenovo is also believed to be in discussion with IBM.

Dell is rumoured to be in talks with IBM to purchase its x86 server family, the Wall Street Journal has reported.

IBM has been looking to offload its PC server business given the challenges in making money from commodity x86-powered servers.

Dell, which was reprivatised by its founder, Michael Dell, last September, is growing its enterprise business, mainly through smaller software acquisitions.

Among the major deals the company has made in its recent history is the purchase of Quest for $2.4bn in September 2012. Recent hardware acquisitions include Wyse, the thin client manufacturer, and Compellent Technologies for storage virtualisation.

Should it acquire the IBM x-series (x86 server) business, the deal could cannibalise Dell's own PowerEdge server family. Analyst Gartner’s latest figures show that HP has a 27.6% share of the server market, while IBM has 22.9% and Dell has 16.4%.

Software appears to big the big push for Dell. In October 2013, CEO Michael Dell said the company had a substantial portfolio. 

"We have an army of software engineers focusing on security management, data protection and backup systems and information management," he said.

Dell said the company was moving into business intelligence (BI), with tools such as Toad BI, and building capabilities in Hadoop and MongoDB.

Lenovo, which purchased IBM's PC business in 2004, is also believed to be in advanced talks about acquiring the x86 server family. 

As Computer Weekly’s sister title MicroScope has previously reported, Lenovo is readying its UK operations for a push into the server and storage space as it looks to build on its PC Plus strategy to expand its market beyond its core desktop and laptop products.

Last week, IBM unveiled an update to its x86-powered PureSystems server family, with a new architecture designed to improve memory performance.

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