Dell Perot: Managed Services, MDM Mid-Market Push Accelerates

Dell Perot: Managed Services, MDM Mid-Market Push Accelerates

Dell Services (largely leveraging the Perot buyout) is polishing a mid-market managed services strategy, according to several large MSPs that are watching Dell (NASDAQ: DELL) closely. The accelerating effort stretches from data center IT outsourcing to mobile device management (MDM). Here are the implications for MSPs.

From Dell to Hewlett-Packard (NYSE: HPQ) IBM (NYSE: IBM) and even Oracle (NASDAQ: ORCL) most major enterprise hardware and software companies have managed services business initiatives under way. Those efforts have accelerated in recent months. While Dell is largely going direct to larger and mid-market accounts, IBM is striving to engage mid-market MSPs. IBM will further clarify its mid-market MSP strategy during an event in New York this fall.

Here Comes Dell (Again)

Most smaller MSPs remember Dell's Silverback buyout from a few years ago. That effort mainly focused on remote monitoring and management of small business servers and desktops. Dell also promotes key hardware and software solutions such as:
But there's also Dell's own services strategy. The company's current managed services push is far more expansive and pushes higher into mid-market and enterprise accounts. It includes:
  • Data center managed services
  • Data center IT oursourcing
  • End user managed services (asset management, configuration and deployment, onsite services and service desk support)
  • Mobile device management -- for Apple iOS (iPad, iPhone, Google Android tablets and smart phones)
  • Telecom expense management

The Updated Strategy

Much of the Dell Services strategy leverages the $3.9 billion buyout of Perot, announced in 2009. Dell and rivals like Hewlett-Packard (which acquired EDS in 2008) have been striving to push beyond hardware into software and services. But so far those efforts have yielded mixed results.

Still, Dell seems to be making progress. During an earnings call in May 2012, CFO Brian Gladden said:
"Our commitment to build a broader set of end-to-end solutions and shift the mix of our business continues to be our top priority, and we're making progress. Our mix of enterprise solutions and services is now 50% of our margin and 31% of our revenue. ... The services business continues to be a highlight. The business grew 4% to $2.1 billion, driven by 8% growth in support and deployment"
On that same earnings call, Stephen J. Felice, president and chief commercial officer, said:
"And our service business continues to show strength and is building a good pipeline and signing new business that should position us well going forward. Our new signings for the trailing 12 months was $1.8 billion, which is up almost 80%, and our services backlog was up 9%."
Now, larger MSPs are hearing whispers that Dell's mid-market managed services is set to accelerate. MSPmentor is checking in with Dell for more perspectives.
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