Dell is Focusing On Green, But Is It The Right Kind of Green For Wall Street?

Michael Dell's keynote speech from the CES show in Las Vegas had a lot of moving parts: A walk-on from a "Dr. Evil" impersonator, a pointer to a new video web site called Studio Dell, announcements of new high-end gaming PCs and a discussion of the importance of making broadband better and more accessible.

(Steven Burke has the full report for CRN.)

The keynote also had a challenge from Dell, whose company has initiated a global, no-questions-asked free PC recycling program:

"I challenge very PC vendor in the entire industry to join us in providing free recycling for every customer in every country where you do business, all the time, no exceptions. We want to do even more."

Dell also announced a partnership with The Conservation Fund and Carbonfund.org, in which Dell will give its customers the ability, when buying a notebook, to donate $2 or when buying a desktop donate $6 toward the planting of a tree that will replenish the carbon used by that device. One hundred-percent of the donations will go to the "Plant a Tree for Me" program.

Dell's company has been having a tough time of it since last year, with slowing revenue and pressure on profit margins -- not to mention increased competition from Hewlett-Packard, Lenovo, Apple and the channel. Even Dell's keynote itself was swallowed up by headlines surrounding Steve Jobs' keynote at Macworld in San Francisco, where he unveiled the long-awaited iPhone and a home media server.

While not as flashy as an iPhone, Michael Dell's environmental challenge could be the day's sleeper.

In Dell's last annual company report with the SEC, it explained its environment-friendly strategy this way:

Dell offers logistical and disposal capabilities for a secure and environmentally safe way to recover and dispose of owned and leased information technology equipment. Various options, including resale, recycling, donation, redeployment, employee purchase, and lease return, help customers retain value while avoiding regulatory fines and storage costs.

Resellers and solution providers have been recycling their customers' PCs for years under the standard, "just get rid of it" clause in many contracts. HP offers a fairly massive recycling program, albeit one for which it charges a fee. And Apple has said it may expand its PC recycling because it has to. According to Apple's most recent quarterly report:

:Production and marketing of products in certain states and countries may subject the Company to environmental and other regulations including, in some instances, the requirement to provide customers the ability to return product at the end of its useful life, and place responsibility for environmentally safe disposal or recycling with the Company.

Such laws and regulations have recently been passed in several jurisdictions in which the Company operates including various European Union member countries, Japan, and certain states within the U.S. Although the Company does not anticipate any material adverse effects in the future based on the nature of its operations and the thrust of such laws, there is no assurance that such existing laws or future laws will not have a material adverse effect on the Company's financial condition, liquidity, or results of operations.

Some parts of the PC market want easier recycling to help the environment. Some parts have no choice, the law mandates they have their computer equipment recycled.

In a press conference after his keynote, Michael Dell explained the tree and recycling initiatives this way: "We think it's good for our customers, we think it's good for the earth, we think it's good for business, too."

For Dell, it's also another effort at boosting customer service that's been under fire for much of the past year. If it works, at least some of that fire might cool off. Wall Street, which has seen shares of Dell take a pounding over the past year, could be happy if Dell's effort to be green in one area ultimately helps it find green in another.