Editor’s note: This analysis of Dell’s (Nasdaq: DELL) move into software was written by Stuart Williams, director of the Software Practice, at research firm Technology Business Research along with Patrick Heffernan and Jillian Mirandi.
HAMPTON, N.H. - The midmarket presents the greatest opportunity for Dell Software to drive adoption ahead of competitors
With no legacy software business to protect, and a midmarket presence, acquisition and integration strategy, the new Dell Software division enjoys an edge over enterprise software vendors IBM, Microsoft and HP.
With the IT market changing from on-premises, static IT environments to dynamic, cloud-driven connected environments, Dell’s direct approach to midmarket businesses (including cloud-based technology and Dell’s robust services arm) will appeal to vendors looking to implement new IT strategies as opposed to customers purchasing line-items.
Both Dell and Quest Software built strong businesses in the midmarket, which gave Dell Software permission to play in the space ahead of competitors IBM and HP. Microsoft also has a strong midmarket presence, but lacks the breadth of Dell’s portfolio.
TBR’s research indicates the midmarket is adopting cloud-based technology faster than the enterprise space, making the midmarket Dell’s greatest opportunity.
A software business is new to Dell; but it is built from effective, tested technologies and a highly competent team that will drive revenue gains
Dell created a multibillion opportunity for itself through Dell Software; however, Dell must take certain steps to capitalize on this opportunity. Dell Software must integrate its acquired products with each other, and with Dell hardware and services.
Next, Dell must create a unified culture, vision and strategy road map to hit its 2016 revenue goal of $5 billion.
Finally, a dedicated software team needs to be trained, a support team needs to be built out and evidence of customer success needs to be publicly marketed.
TBR believes Dell Software has the IP and team to do this — but the speed of full integration remains unknown. John Swainson, president of Dell Software, has experience (from CA Technologies and IBM), integrating acquisitions, making them work together and then bundling them into solutions.
Dell has full confidence in Swainson as well as deep pockets and some time away from the public eye to focus on the success of Dell Software. TBR believes it will take up to five years for Dell Software to fully emerge and become a mature line of business for Dell and the market.
Dell Software is takings steps toward offering a slimmed down, targeted set of solutions around four key trends: security, mobility, big data and cloud. Dell Software is addressing these trends with solutions in security (SecureWorks, SonicWall, Credant and Quest), systems management (Quest, Wyse, KACE and AppAssure), information management (Quest Toad and Toad Business Intelligence [BI] Suite, Boomi and Dell Quickstart Data Warehouse Appliance) and BI analytics (Quest Kitenga).