Dell's (NASDAQ: DELL) board of directors will reportedly meet this evening (Monday, Feb. 4) to vote on a leverage buyout that may take the company private, Bloomberg reported.

The VAR Guy

February 5, 2013

2 Min Read
Memo to Dell Board Voting on Buyout: Don't Bow to Microsoft

michael-dell

Dell’s (NASDAQ: DELL) board of directors will reportedly meet this evening (Monday, Feb. 4) to vote on a leverage buyout that may take the company private, Bloomberg reported. Indeed, Silver Lake Management, Microsoft (NASDAQ: MSFT) and Michael Dell are expected to to be among Dell’s key investors. Among the potential concerns for channel partners: Will Microsoft’s potential stake in Dell allow the software giant to dictate the types of software Dell offers to mobile, desktop, server and cloud partners? Hmmm…

First, let’s look at the potential upside. A closer Dell-Microsoft relationship could give partners more innovative and more scalable devices across the board — though other PC and server makers could be irked.

On the potential downside, multiple reports suggest Microsoft may demand Dell make certain commitments to Windows 8 and future upgrades. The VAR Guy has already stated that Dell’s relationships with the open source community — where names like Red Hat, SUSE and OpenStack come to mind — could become strained.

Still, the real story here likely involves a longer-term business transformation. Michael Dell has been marching into alternative markets like storage, networking, IT systems management and enterprise software. The company continues to sell millions of PCs, but Michael Dell realizes the long-term path to growth must somehow come from outside the PC market.

During an interview with The VAR Guy in 2012, Dell’s CEO said the company’s transformation into an enterprise hardware and software provider was proceeding well. And he reiterated support for Dell’s PartnerDirect channel program.

Surely, PartnerDirect will march forward if Dell goes private. Let’s just hope Dell — rather than Microsoft — ultimately calls the shots on Dell’s channel and OEM strategy.

Read more about:

AgentsMSPsVARs/SIs
Free Newsletters for the Channel
Register for Your Free Newsletter Now

You May Also Like