Microsoft: Big Loan To Dell, OS Conditions
While Microsoft had been rumored to be planning to invest in Dell's privatization, the operating system and software giant will instead loan the investors $2 billion to help finance the details. It is widely believed the change came in response to concerns that Microsoft might favor Dell over its other OEM partners.
However, there are strings attached. While Microsoft will not get a seat on Dell's board, there is a stipulation in the agreement between the two companies that "Dell would agree to use Microsoft's Windows software to power the vast majority of its devices," the Wall Street Journal reported.
This is seen industry-wide as a move by Microsoft to stem the customer exodus from the company's Windows operating system to other fast-growing operating systems such as Apple's iOS and Google's Android.
However, for Microsoft, the possibility of such a tight bond with Dell puts its OEM relationships with other top-tier PC and server vendors in possible jeopardy.