Dell-Google Hijinks

Last week, Dell publicly confirmed in response to a Wall Street Journal article that it is running a test with Google that includes a Google-powered Dell home page, Google desktop search and a Google toolbar. Google, meanwhile, said it is conducting “a test of distribution of some of our software via Dell.” Those who want to get a look at the so-called test can go to a Dell start page being hosted by Google at www.google.com/ig/dell.

For years, Microsoft has provided Dell with favored pricing on Windows and Office. At the same time, system builders got the short end of the pricing stick. Suddenly Dell, which is seeking to garner revenue any way it can to meet Wall Street expectations, is looking to repay Microsoft by collecting cash from Google in exchange for running the Google desktop on millions of Dell systems. Ain&'t life grand. Gates is getting the strong-arm treatment he&'s given countless non-Dell companies over the years.

At the same time the Dell-Google hijinks were coming to light, Microsoft said its Windows OneCare Live security service will be available in June from retailers and via the Web for an annual subscription of $49.95 for up to three PCs. The software giant had nothing to say about any kind of system builder or VAR pricing. So what&'s all this mean to channel partners? Well, system builders hope the Dell-Google “test” will wake up Microsoft once and for all.

Steve Plotz, president and CEO of Computer Systems of Tampa, Fla., a 15-year system builder, says, “The Microsoft-Dell marriage is about to hit the divorce court.” Plotz hopes Microsoft will finally realize that by putting all its eggs in one basket with Dell it has jeopardized its business and will now offer better terms to system builders. “We system builders are the largest combined producers of systems in the U.S., and a lot more people are getting away from the name-brand systems and going to system builders because of the stronger service we offer.” That superior service is changing the game. Microsoft would be smart to wise up and start putting system builders first and Dell last.

What do you think of the Dell-Google hijinks? Let me know at (781) 839-1221 or via e-mail at [email protected].