Dell's SMB Giveaways Spook Channel

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A flurry of Dell SMB service giveaways has potential channel partners worried about the vendor's motives as Dell launches a channel recruitment drive.

Arian Soheili, managing director of Cantatus Systems Group, a Vancouver, B.C. managed service provider, cautioned other solution providers in a Dell recruitment session at XChange '07 in Orlando, Fla. that he had received a direct mail piece from the vendor offering free services that competes directly with his own managed service offerings. Soheili fears that Dell will offer even more aggressive bundled managed services offerings in the wake of the vendor's acquisition of SilverBack Technologies last month. Some partners believe Dell is aiming to bundle the SilverBack technology on every notebook, desktop and server it ships out the door.

The letter, which Soheili received last week and was examined by CRN, touted free managed service-like offerings bundled directly with Dell's new Vostro line of small business notebooks and desktops which were introduced last month as both a channel and Dell direct small business product line.

"VOSTRO doesn't end with new notebooks and desktops," the Dell letter reads in part. "In fact, that's just the beginning. At the heart of Dell's new Vostro systems, you will find the most comprehensive standard support services designed for small business."

Among the services bundled with systems at no additional cost are one-year online data backup, one year PC tune-ups, and 24/7/365 support through DellConnect provided by dedicated small-business trained technicians, the letter said.

"This is calling them on their doublefaced approach to the market," said Soheili, whose managed services make up about 20 percent of his business."This is a huge threat. We have got the exact same business. We sell offsite managed service backup and support. We will never be able to compete with these guys when they are selling a PC at low competitive prices and including the services we charge money for. They are giving all this stuff away." Dell's free online backup service is a $49 per month per user, service for Cantatus with a one-year tuneup, amounting to about $300, said Soheili.

Chris Bates, director of Dell's Solution Provider Direct Division responded that he was not familiar with the letter sent to Cantatus by Michael Lombardo, Director and General Manager, Home and Small Business, Dell Canada.

"We don't have a lot of answers figured out," Bates said. "But we are really excited about having SilverBack on board. But the big picture here is you have a whole organization aligned with your success. We do have an element of Dell that is direct, but at the end of the day it's about offering customers choice."

NEXT: Solutions Providers Wary Of Dell

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