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The Complicated World Of Dell

Staff Writer
Published: 2004-11-21

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Dell is the number 1 seller of computers, but how it expands and stays on top involves numerous business activities around the world.

Dell is a complicated weave of products, systems and customers. A variety of issues impact Dell and Dell impacts a variety of businesses, consumers and governments.

Here is a week in the "Complicated World of Dell":

Dell Fights To Become Home Media Central ...
"The price will enable more consumers to tap into the power of their personal computer as an entertainment device and is part of Dell's aggressive effort to give holiday shoppers more enjoyment from the PC for less money," Dell said in a statement.

Dell Building More Manufacturing Plants ...
Guilford County officials say they will unveil an incentives plan to attract a $115 million Dell computer plant before other competing Triad counties. Dell, the world's largest personal computer maker, announced this month it will build its third U.S. manufacturing plant in the Triad. The plant work force ultimately could exceed 2,300, plus thousands of peripheral jobs.

"Everyone knows Dell, they all know the Michael Dell story and there's a little magic with that name," said Lebanon Mayor Don Fox. "And whenever you associate the city of Lebanon with Dell, then that magic kind of rubs off. We've benefited from that in a lot of ways."

Dell and Microsoft Win Air Force Contract ...
Microsoft Corp. and Dell Inc. have won a $500 million contract to supply software and maintenance to the U.S. Air Force over the next six years. According to the AP wire service the agreement calls for Microsoft to provide server software, maintenance and support for upgrades. As a reseller, Dell, the personal computer maker based in Round Rock, Texas, will provide more than 525,000 licenses for Microsoft's Windows operating system and Office business software.

Dell Announces Wireless Printers ...
Dell on Thursday announced a Wi-Fi enabled adapter for its printers. The Wireless Printer Adapter 3300 allows users to print, scan or fax without being connected to their printers. The computer needs a wireless card and must be connected to a wireless network.

Spyware Affects Dell Consumer Support ...
People who call Dell customer service often have no idea why their computers are running so slow. And because they consented, "in some ways it ties our hands because we can't legally interfere," said Mike George, head of Dell's US consumer business.

Dell Confirms Problem With OptiPlex GX280 SMT Chassis ...
Dell sent a "tiger team" to Taiwan to help work out a solution for the problem, the sources stated. According to Dell, customers look to Dell for a single point of accountability, and the tiger team is one of a range of company initiatives through which Dell works closely with its partners to ensure that high product and quality standards are maintained.

The State of Oklahoma Is Getting a Dell ...
A five-year exclusive contract that state officials signed last month with Austin, Texas-based Dell Inc. could be worth more than $150 million based on figures released Tuesday.

Dell first revealed plans to locate a service center in Oklahoma on July 7, "...but the contract timing was purely coincidental", said Scott Meacham, state Office of Finance director. "There is no relationship between this contract and Dell's decision to locate in Oklahoma City," Meacham said. "To be honest, my guys didn't even know that contract was going on until it was announced."

Dell appoints Mindware to serve the Saudi SMB market ...
"There is a very real need for quality computing solutions and services by the Saudi SMB sector. Together with Dell, we're stepping in to meet this demand with a dedicated range of products and services available immediately across the Kingdom," said Jacques Chammas, Managing Director, Mindware.

Microsoft, Dell and Vintela Team Up To Bite IBM ...
"Traditionally, companies like HP and IBM have aimed to support their customers on upgrades by throwing people and methodology at the problem, on a bill-per-hour basis," said Microsoft's Kirill Tatarinov, SMS 2003 boss and corporate vice president of the Enterprise Management Division, Microsoft. "We can solve the problem with software."

Peter Morowski, Dell's vice-president of software, said that the technology was "not in any way" proprietary. Microsoft would make this available as part of MOM 2005 and SMS 2003 to any hardware builder, and Vintela would make it available for Unix, Linux and Apple Mac platforms.

"Our customers were asking 'why do I have to manage my hardware separately from the software stack, with every hardware vendor proiding proprietary tools; they'd go to Dell web site, get new patches, then run Dell tools to update; then go off and update software?' and a year ago, we promised to devise a solution. We've done that."

Dell Hiring In India Again...
Dell is setting up its third India contact centre in Mohali and experts say it is likely to trigger off an employment boom in the region. The managing director of Dell India Romi Malhotra says, "We recognised the potential Englishspeaking talent along with the good infrastructure facilities in close proximity to Delhi. Also the success of our two call centers gave us confidence to expand our operations with a new facility here."

Hewlett-Packard Loses Sales as Dell Cuts Prices ...
Hewlett-Packard's home PCs start at $379 on its website, compared with $349 for Dell, which cut prices as recently as last week. "The PC side is extremely challenging,'' said Chuck Jones, an analyst at Stein Roe Investment Counsel in San Francisco, which manages $16 billion and owns Hewlett-Packard shares. "Dell's really a major challenge.''

Dell's Rollins told analysts last week his company will exceed its goal to ship 5 million printers and have sales of $1 billion in its printing business by the end of January. After starting in low-priced inkjet models, Dell now targets Hewlett- Packard's most profitable products: laser printers and supplies.

Dell Pushes New Cheap "Blades" ...
Dell unveiled the PowerEdge 1855, a blade server that it says offers more performance and lower costs than its standard 1U, or 1.75-inch, rack mount servers. According to CNet, "Dell envisions customers using the blades to replace large numbers of standalone servers, to serve Web pages, to host applications and even to crunch numbers in high-performance clusters."

Dell Asia Director for Enterprise Damian Crotty said the PowerEdge 1855 provided both long-term and immediate total cost of ownership (TCO) benefits for customers relative to traditional server form factors. ''Initial blade investments from Dell are no longer prohibitive and customers will save more with every blade they install -- improving their TCO as they scale out,'' he said.

Dell Confident Of Its Furture ...
The company said late Thursday that it earned $846 million US, or 33 cents a share, compared with $677 million, or 26 cents a share, a year earlier. That matched its own forecast from August as well as Wall Street expectations.

Citing its direct-sales model, Dell said it was on track to become a $60-billion company sometime in 2006, roughly a year ahead of schedule. "Our confidence in hitting some pretty good numbers is increasing," Dell chief executive Kevin Rollins said. "We're ahead of plan. The growth rates appear to be achievable."

"They seem as strong as ever," said Tim Bajarin, analyst at Creative Strategies. "Dell's business model still is the most effective when it comes to selling PCs to the customer."

Rollins was particularly pleased with Dell's printer business, which is on track to sell more than five million printers this year, calling it "the most successful of any startup business we've ever had at Dell."

"We believe in the advent of the digital home and the opportunity to combine more products in the home, but consumer is not our number one focus," he said. "It's the enterprise."

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