Experis Technologies thoughts – Dell announces plan to acquire EMC – First Look
On October 12, 2015 Dell and EMC announced that they have signed a definitive agreement under which Dell, together with its owners, Michael Dell, MSD Partners and Silver Lake plan to acquire EMC, while maintaining VMware as a publicly-traded company. The deal will cost ~$67B and will result in a large amount of debt. To pay back the interest on the $50B of debt that the new combined company will have on their balance sheet, Dell will need to pay roughly $2.5B a year in interest alone. That’s $2.5B that they will allocate away from R&D and other business critical activities, which will keep them from better serving their customers and does not solve the fundamental issue affecting both Dell and EMC:
This deal which is being promoted as the biggest tech merger ever will do nothing to address the fundamental problem that both companies face. They make products that were popular 15 years ago but are now barely growing.
Dell and EMC have not been able to develop product innovations or mergers to offset that problem. Bringing two portfolios together will require a significant amount of product rationalization, which will be disruptive to their business and create confusion for their customers. Customers simply will not know for some time, if the products they are buying today from either company will be discontinued and made obsolete.
The current Dell Storage product line of EqualLogic and Compellent combined with the current EMC product line of VNX, VMAX, Extreme IO, DSSD, Scale IO, VSAN have significant overlap. Predicting which product lines will survive and product rationalization will likely cause customer confusion and frustration.
Experis Technology Group, Inc. made the transition two years ago away from Dell and EMC because their products and services were disjointed, innovation was lacking and Experis wanted to make certain that customers invest in infrastructure that serves as a foundation for today as well as allow for growth well into the future.
This is where Hewlett Packard Enterprise (HPE) has invested in the infrastructure products and services that Experis’ customers are looking for. The best example is the HP 3PAR acquisition. HP acquired 3PAR three years ago and it has been the most successful storage platform Experis has ever provided to its customers. It is truly the world class storage platform the industry proclaims it to be.
Combined with HP Servers, Networking and security, Experis customers create an infrastructure second to none with support from one company. HP products are always in the right upper quadrant published by Gartner.
If you would like Experis to discuss your infrastructure requirements, please contact us at 240-223-0607 x 12 or at firstname.lastname@example.org