Dell Makes Managed Email Acquisition

In less than a year, Dell has made three key acquisitions to pump up its managed services and software as a service (SaaS) business. The latest acquisition involves MessageOne, which specializes in email continuity, compliance and archiving as a managed service. Here's the scoop, and the bigger picture on Dell's managed services push.

Dell is moving into a growing but increasingly crowded market. Most leading managed service providers already offer some form of online storage and managed email services, according to the recent MSPmentor 100 report. And the market will become more crowded as giants like Symantec prepare to launch the Symantec Protection Network, a SaaS system that will initially support online storage but expand to include security capabilities. We also expect market consolidation/M&A activity to continue (see MSPmentor's M&A Tracker).

Still, Dell's moves are worth watching. Recent acquisitions include Silverback Technologies (an MSP platform provider), Everdream (remote desktop management) and EqualLogic (storage). Plenty of MSPs and VARs are worried Dell's direct-sales heritage will undermine existing Silverback, Everdream and EqualLogic partners. However, Dell insiders have told me that they are "flooded" with partner inquiries.

As Level Platforms CEO Peter Sandiford has said, Dell's interest in the SaaS and MSP markets has been a watershed event for the overall managed service markets. As MSP platform providers explore potential initial public offerings (IPOs) over the next few years, industry validation from Dell, Cisco and others should help to drive up company valuations.

For its part, Dell will need to work closely with MSPs in order to drive new revenue opportunities, as part of a strategy to restore Wall Street's confidence in the PC company.

Ironically, Michael Dell's brother co-founded MessageOne, but the PC giant says that was not a factor in the acquisition. In fact, Dell Inc. took extra steps to ensure Michael was not involved in the acquisition discussions.