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Solution providers have watched with an odd combination of trepidation and glee as the mighty Dell has faltered in its attempts to provide services to its vast customer base.
For years now, services have been the savior of the traditional VAR. Stop pushing boxes and focus on services, and all will be right with the balance sheet, right?
Well, it’s no wonder that VARs that have been shifting their mix of business toward services are a little worried when the company most responsible for commoditizing the PC business wants in on the services business.
And Dell wants in bad.
Dell CEO Kevin Rollins recently said that despite a few recent hiccups, he thinks his company is still on track to double its revenues and hit the $100 billion mark. How? Rollins said Dell will focus on international growth, storage and its services business to hit that target.
And, as CRN Senior Editor Dan Neel reports this week, the Round Rock, Texas-based computer maker is exploring ways to branch out into on-site IT support and repair services. Neel reports that Dell is in talks with Reliable IT, Springfield, Va.; OnForce, New York; and ServicePower, Louisville, Ky. Reliable IT, in conjunction with OnForce, offers direct, nationwide IT services. ServicePower is a field-logistics automation company that optimizes the scheduling and deployment of field-service calls.
Dell wouldn’t comment on the story, but the takeaway for solution providers is simple: Dell is serious about building its service capabilities.
To be sure, Dell can use its powerful brand, recently rated the most trusted name in PCs, to move deeper into the services business and claim some market share. But will it have the power to change the services market the way it changed the PC market?
Nope. Dell changed the PC business by eliminating the middleman. In its new services plan, Dell is the middleman, limiting its ability to squeeze the costs out of the transaction.
With its 1-800-number level of service and market prices, Dell is just another player in the market. And who worries about that?
Does Dell's service play have you worried? Let me know at (415) 947-6229 or via e-mail at lrhooper@cmp.com
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