Dell Scoffs At Rivals' Channel Exclusivity Demands

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Q&A With Michael Dell

Michael Dell scoffs at the notion of vendors strong-arming solution providers into selling their end-to-end portfolios, throwing around the word "loyalty" as if it were something a company could demand -- instead of earn.

It's been three years since Dell's chairman and CEO has been transformed from channel antagonist to channel protagonist. In the years leading up to the formal launch of the company's channel program, Michael Dell said he has seen behavior that is just not attuned to the realities of today's IT environment.

"Customers today are looking for best-of-breed answers," Dell said in an exclusive interview with CRN (read the interview following this story). "They like competition. They don't want to be beholden to one vendor. The reality is the data center is a heterogeneous world. … To assume everybody is buying everything from one company is just not realistic."

It's a well-known fact that some of Dell's chief competitors increasingly want solution providers to focus only on their branded solutions, in essence creating closed-market systems that reward fewer, more "loyal" VARs, so it's rare to find a company bucking that trend. But at Dell, the door's wide open.

And solution providers are coming on through.

Dell's channel business has blossomed since the launch of its official PartnerDirect program in 2007. The Round Rock, Texas-based company's global channel revenue increased 49 percent in the second quarter of 2010, compared with the year-ago quarter. U.S. channel sales were up 38 percent for the same periods, said Greg Davis, vice president and general manager of global commercial channels.

As of October, Dell had more than 61,000 registered partners worldwide and about 2,300 certified partners, including almost 1,000 in the U.S. A year ago, Dell had only 1,300 certified partners globally. While many companies increasingly expect solution providers to sell more of their respective products, Dell places no restrictions or minimums on the breadth of products its partners sell. That's no accident. Dell realizes that customer IT environments have multiple vendors in-house and it's crazy to pretend otherwise, said Davis.

"We always have been an open-architecture company. I want you to sell 100 percent Dell servers, storage and networking. I'm not creating proprietary reasons to do it, but we will try to win the business every day by making sure our program, our products, are the best in the market and allow you to be successful with customers," he said.

With this strategy, Dell hopes to win over solution providers frustrated with other vendors' my-way-or-the-highway attitudes, Davis said.


NEXT: Dell's Partners

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