Q&A: Michael Dell On Dell's Server Gains


Dell Founder and CEO Michael Dell spoke with CRN Editor News Steven Burke Friday, after market researcher IDC released first quarter preliminary unit server share data showing Dell share gains over Hewlett-Packard in both North America and worldwide.

IDC's preliminary data shows Dell grew its first-quarter North American server shipments by 9.9 percent, while HP's dropped 18.9 percent. On a worldwide basis, Dell's first-quarter server unit shipments grew 5.7 percent, while HP's declined 15.4 percent compared to the previous year, according to IDC. The IDC data mirrored preliminary unit server data from market researcher Gartner earlier in the week.

Below is an excerpt from CRN's conversation with Dell.

CRN: HP disputed the Gartner data showing Dell unit server share gains. Now the IDC data is out and shows Dell gains -- talk about that.

Dell: There is no denying the facts. HP is losing share at a staggering rate, and they are losing it to Dell.
When the Gartner data came out, HP wanted to wait for the IDC data because they said that wasn't the official data. He doth protest too much. Now you have your IDC data. Look, we gained the most share and HP lost the most share [during the quarter, according to IDC]. Customers are choosing Dell over HP in record numbers. The data is real clear. You can talk all you want. The facts tell the story.

CRN: HP has pointed to uncertainty around the leveraged buyout. Can you talk about that?

Dell: It's nonsense. They are trying to create something that is not there because they know they are under attack. They are trying to create the illusion that there is turmoil. If there is any turmoil, it is at HP.

CRN: What happens when you complete the leveraged buyout?

Dell: Get ready. We're getting more aggressive. What it also means for partners is it has never been a better time to be a Dell partner.

CRN: How much of the server share gains are due to the channel?

Dell: The channel is definitely growing faster. The channel is playing a huge role. But, it could certainly be more. There is a lot of upside here.

CRN: What is your message to your channel partners?

Dell: First, thanks. We couldn't do this without you guys. We really appreciate the partnership we have. It is going to get a whole lot more fun.

CRN: Can you talk about what you are hearing from partners?

Dell: We had a channel summit earlier this week with a whole roomful of partners. The partners were all smiles ear to ear because they see us being aggressive. If you look at the numbers it is pretty staggering. In North America, we gained 4 points of [unit server] share, and HP lost 5.7 points of [unit server] share.

We have channel momentum. There is no question about it. And, we also have awesome products. Look at the 12th Generation PowerEdge [servers]. We are first to market. We have differentiated products like the [PowerEdge] R720xd. HP has nothing like it. IBM has nothing like it.

We have an extremely reliable and predictable channel program that has been in place since 2007. We have earned the trust of our partners, and now it is paying off in a cumulative effect. We have the best supply chain in the industry. We have the right cost structure so we are able to be aggressive and gain share. We are just getting started here.

CRN: How much communication have you had with channel partners?

Dell: I am constantly meeting with partners. Every city and country I go to I meet with partners. This is just part of how we do business now.

PUBLISHED MAY 6, 2013