CDW Not Onboard With Dell-EqualLogic

As the day of reckoning coming for EqualLogic's relationship with solution provider behemoth CDW?

That's a question worth asking given that Dell's $1.4 billion blockbuster acquisition of the SAN provider is about to be finalized. There are more than a few rumblings that CDW has let it be known EqualLogic is persona non grata. Several sources claim that EqualLogic sales reps working on-site are for all practical purposes being frozen out of deals. CDW won't comment. But EqualLogic Vice President of Marketing John Joseph said that the EqualLogic reps are still on-site and working with the solution provider to close deals. In fact, he said, the CDW business has not fallen off since the deal was announced last year.

STEVEN BURKE Can be reached at via e-mail at sburke@cmp.com.

"The business relationship continues with CDW," Joseph said. "We're still working out the long-term strategy between the two companies."

That said, a CDW-EqualLogic rift would not exactly be breaking news considering CDW has long thought of Dell as its archnemesis in delivering the best IT value for any and all products and services to businesses of all sizes. The most visceral example of the longtime CDW-Dell antagonism: CDW Chairman and CEO John Edwardson on his first day at the company some six years ago taking a sledgehammer to a Dell PC in front of hundreds of employees. Edwardson has already publicly signaled that there are problems with the Dell- EqualLogic relationship. What's more, he said, he was not comfortable sharing account and warranty data with Dell. That's a sentiment shared by many solution providers.

It's not surprising that Edwardson would shun Dell-EqualLogic. In 2006, products from Dell's biggest competitor, Hewlett-Packard, made up a whopping 26 percent of CDW's $6.78 billion in sales. Is CDW really about to jeopardize its relationship with HP for what amounts to CDW EqualLogic sales of $12.74 million for the nine months ended last Sept. 30?

What Dell has to ask itself is, just what is its channel proposition regarding EqualLogic? And for that matter, what is Dell's channel proposition to any and all HP channel partners who have built up huge, profitable business over many years?

Edwardson has got to be talking to HP Chairman and CEO Mark Hurd about coming up with an HP competitive alternative to EqualLogic. If he isn't already, Hurd should look at the likes of FalconStor, Hifn and LeftHand Networks. Storage is red-hot and HP needs to shore up its product line.

What companies do you think HP's Hurd should look at?
Let me know at sburke@cmp.com.