Dell delving deeper into wireless territory

By Michael Kanellos, CNET News, 1 May, 2003 08:59

NEWS

Dell Computer will expand deeper into the wireless market as part of its overall goal of increasing annual revenue to $60bn, or about £38.4bn, in the next few years, according to company President Kevin Rollins. Speaking on Wednesday at Merrill Lynch's Hardware Heaven conference here, Rollins said that Round Rock, Texas-based Dell plans to expand its wireless product portfolio as well as its alliances with wireless device makers. This week, the company said it would resell handheld email devices from Good Technology. "The Good Technology deal is part of an overall wireless strategy. We believe wireless is the next big thing," Rollins said. "You will see us continue to expand and broaden the product offerings." True to Dell form, however, the wireless expansion will be conservative. Although the company will likely increase the number of wireless notebooks and PDAs it sells, it has no plans to get into mobile phones right now because most of the profit in the mobile phone market goes to the carriers, Rollins said. Dell will also work with a variety of companies, such as Good, to develop products that Dell doesn't want to directly create or sell under its own brand. In other areas, Rollins said Dell will continue its onslaught against its traditional competitors through aggressive cost cutting and a focus on servers, storage systems and PCs made from standardised components. Dell now currently racks up annual revenue of around $35bn but says it can hit $60bn in the near future. Despite the slowdown in PC buying, Dell has continued to expand its market share, Rollins noted. In the first quarter, Dell overtook Hewlett-Packard again to become the largest PC maker in the world. The company is profitable, something many competitors aren't, he said. "We make money. IBM makes money. Who else makes money? No one," Rollins said, adding that HP turns a profit in printing but not in computing. "We don't believe our competitors are prepared to be as cost aggressive as they need to be... They will have to continue not to make money, or they are going to have to back off to fatten their margins, which will cause them to lose market share." Rollins added that Dell has been even more aggressive in cost and price cutting this year than last year. Further, the company is heavily participating in the segments of the industry that are growing. For instance, Dell has not dedicated substantial resources to selling blade servers or servers with eight processors or more. Although these products attract high prices, volumes remain low. Two- and four-processor servers, a Dell specialty, are growing in performance and popularity. "We will make multiprocessor capabilities for those that want it, but we just don't believe that is the focus of the growth rate," Rollins said. The company will come out with Itanium servers this year, as previously reported, and is continuing to evaluate the Opteron processor from AMD. Similarly, in services, Dell will focus on "close to the box" services, such as help desk and asset management. Dell does not want to compete against Electronic Data Systems or Accenture on complex consulting engagements. At the same time, PC services are becoming an unspecialised, mass-market offering, often involving automation, which gives Dell an opportunity to undercut others with price. Low-cost, overseas staffing will be part of the company's strategy. Rollins used the services discussion to take another dig at HP, which inherited thousands of services employees, many based in the United States, when it acquired Compaq Computer. With new automation tools, large fleets of technicians will become a problem, he said. "Through our lower overhead, through our offshore capabilities, through remote diagnostics, you are seeing (the erosion of) the ability to put feet on the street," Rollins said. "Large armies of people out there will become a liability." Rollins also said that a slight PC upgrade cycle has apparently begun, but the market remains slow. "We believe there is an upgrade cycle occurring. It is just slow and muted," Rollins said. "We have not seen any change in the marketplace to indicate we are out of the slowness."

For a round-up of the latest tech business coverage, see the Business News Section. Let the editors know what you think in the Mailroom.

Post your comment

In order to post a comment you need to be registered and logged in.

You can also log in with Facebook. Log in or create your ZDNet UK account below

By signing up for this service, you indicate that you agree to our Terms and Conditions and have read and understood our Privacy Policy. Questions about membership? Find the answers in the Community FAQ

ZDNet UK Live

Replying to an old topic that I'm currently facing with my CEO (who is on a Mac). Our servers are primarily Windows Servers, office is about...

6 hours ago by txtrainguy on Windows Server 2008 drops the ball for Mac compatibility

Sure, that makes perfect sense. Pay wrong-doers money and thank them for breaching your security and pointing out your flaws, that would surely...

7 hours ago by k0tcs3 on US indicts Romanian over NASA climate change hack

I think he's referring specifically to Android apps, as Apple do regulate their App Store, but Google seem to let any old crap onto the Android store!

7 hours ago by Random_Error on RIM: BlackBerry will keep 'garbage' apps out of store

Keep the crap apps out?! How will they compete with Android and Apple's claim to fame of having so many life changing apps? I wonder if the media...

12 hours ago by Paul Fezziwig via Facebook on RIM: BlackBerry will keep 'garbage' apps out of store

It has been shown time after time that if there is an author store that sells the songs at even 1$ per song and gives you a high-quality digital...

13 hours ago by Aigars Mahinovs via Facebook on Copyright isn't working, says European Commission

""As a result of Butyka's alleged conduct, researchers were unable to use the computers for more than two months while NASA removed the malicious...

16 hours ago by awbMaven on US indicts Romanian over NASA climate change hack

It simultaneously worries me and uplifts me that a self-proclaimed group of internet activists name themselves after Indian mythical figures....

1 day ago by subhorup on Anonymous activists release PCAnywhere source code

It's actually far easier to work anonymously on the internet than you think. With tools like Tor bouncing your traffic around the world before...

1 day ago by naviathan on Anonymous activists release PCAnywhere source code

1000272134 and bluedalmatian with you both there but then I'm still in 10.04 land (and happy with it)

1 day ago by Agnostic_OS on Ten factors that make Ubuntu 11.10 a hit

Interesting article and definitely see your points on the products mentioned. One of the top products for our Help Desk (approximately 20% of all...

1 day ago by apexwm on Ten flawed products that derail productivity

Absolutely - this should obviously not be handled my isp - but handled by their hosting operator. What's been suggested here is that my isp police...

1 day ago by Paul Hutchinson via Facebook on MPs urge ISPs to take down terrorist material

Looks like a great phone. I don't notice any deficiencies in WP7. used IOS before, that's pretty good. I don't spend much time in Apps, all i need...

2 days ago by Techs UK on Nokia pins US 're-entry' hopes on Lumia 900

Now with the help of these apps you are always synced with MS outlook while on the move. Just download apps like xobni or outlookreflex and get...

2 days ago by Larry Bloggy via Facebook on Outlook Social Connector beta 2 and the LinkedIn connector

Your details are wrong. The version currently being made is the one with 2 USB ports, 256MB RAM and a network port. This is the Model B. The...

2 days ago by mike40g123 on Raspberry Pi boards set to go on sale

The thing that has been puzzling me for quite a while is how Anonymous can remain anonymous whilst not only being active on the Internet but also...

2 days ago by Moley on Anonymous activists release PCAnywhere source code

If what Semantec is saying is rue, that is even worse and shows a complete disregard for thier users. If what Anonymous claims is true and the...

2 days ago by Don Dilly via Facebook on Anonymous activists release PCAnywhere source code

Didn't seem particularly biased to me either. Oh though you might have mentioned some other competitors with free search and email services...

3 days ago by MattChurchy on Time for an evil umpire: Google, Microsoft & privacy

James - exactly as much as anyone paid you for your comment; I don't feel that I need to say that I'm independant and unbiased, but just for you...

3 days ago by Simon Bisson and Mary Branscombe on Time for an evil umpire: Google, Microsoft & privacy

Once they realise symantec are willing to pay real money, they will simply keep extorting, unless of course symantec/authorities can use the...

3 days ago by Carl White via Facebook on Symantec offered hackers $50k in source code sting

You can find more information on BS 8878 by Jonathan Hassell its lead-author at http://www.hassellinclusion.com/bs8878/ The page includes a...

3 days ago by Jonathan Hassell on BSI publishes first British web accessibility standard

Featured white papers

Latest jobs

Dell delving deeper into wireless territory

Daily Newsletters

Topics

Related stories

Dell preaches what it practises

Dell strikes a Good deal

Heart of England NHS begins massive digitisation plan

Hard-drive woes hit PC shipments in fourth quarter

Post your comment

ZDNet UK Live

Latest in IT Strategy

Heart of England NHS begins massive digitisation plan

Hard-drive woes hit PC shipments in fourth quarter

Featured white papers

Latest jobs

MS Office 2010 Trainer - Cambridge

Dynamics CRM Technical Consultant

Product Development Manager - Newcastle upon Tyne

Inside ZDNet UK

Cabinet Office: no lobby influence on open standards

2012 Predictions: VCE FastPath, VI SAN Probe & Hadoop

BlackBerry Bold 9790

2012 Olympics: Is your business prepared?

Ten factors that make Ubuntu 11.10 a hit

Toshiba Portégé Z830-10P Review

BT's archive: Pictures from the vault

News & Analysis

Reviews

Blogs

Resources

About Us

Member Services

Special Features

Advertising Features

ZDNet UK / News and Analysis / Business of IT / IT Strategy

Dell delving deeper into wireless territory

Daily Newsletters

Topics

Related stories

Post your comment

Get ZDNet UK's daily newsletter

Enter your email address to sign up

ZDNet UK Live

Latest in IT Strategy

Featured white papers

Latest jobs

Inside ZDNet UK

Resources

About Us

Member Services

Special Features

Advertising Features