This question was on the lips of many attendees at last week’s EMC World in Las Vegas. The conference provided some answers as well as insight into future direction with Dell. It became clear that Dell sees EMC as a major piece of a strategy to move into the higher end of the market using EMC’s enterprise SSD and data storage system assets, as well as gaining a greater presence in the hyperconverged data center space.
Dell Influence Apparent
Although the merger with Dell is still subject to regulatory and shareholder approval and can’t be completed until October, the influence of Dell was apparent at last week’s EMC World in Las Vegas. The theme of the event, for example, was “Modernize the Data Center.” There is no question that this plays right into Dell’s ballpark. Armed with EMC’ storage arsenal for the high end, its own midrange and SMB offerings, Dell servers, and easy access to VCE, VMware and RSA products, Dell is in a great position to provide much of the hardware, software and tiered storage elements that enterprises will need for modernization projects as the market moves towards a greater degree of convergence.
At this final EMC World, it was fitting that long-term EMC chairman and CEO Joe Tucci got a chance to say farewell. A standing ovation at the end of his talk revealed how happy people were with his tenure. With him at the helm, the company transformed from a hardware-based high-end data storage system provider to being dominant in storage software, enterprise SSDs, tiered storage and many other markets.
Tucci took his brief final moments in the spotlight to explain the reasons for the deal with Dell from his perspective. He’s a fan of the digital revolution and the Internet of Things, which he believes is going to dwarf the Industrial Revolution in terms of societal impact.
“In a market where data needs to be collected, stored and analyzed from hundreds of billions of connected devices, our merger with Dell is going to create something that differentiates us from the competition in terms of data storage systems and other technologies,” said Tucci.
Michael Dell, chairman and CEO of Dell, backed up that theme with some statistics. He noted that 50 percent of cars will be driverless by 2030, and there will be 200 billion connected devices by 2031. With each sensor, component, device and machine pumping out data, those on the front end may get the media attention, but the back end heavy lifting and underlying hyperconverged infrastructure will bring in the lion’s share of the revenues.
“Dell and EMC will be a major cloud infrastructure provider in an increasingly Dev Ops world,” said Dell.
Complementary Data Storage Systems
Dell explained how both companies were complementary. Between them, they hold leadership positions in 21 Gartner Magic Quadrants. EMC, he added, is strongest at the high end of data storage system, while Dell holds sway in many mid-market and SMB markets.
“EMC is the most successful company at incubating new technologies,” said Dell. “Together, we will become the world’s largest enterprise systems company.”
Dell stressed the importance of being a private company. He lambasted the 90-day thinking that hamstrings many on the stock market and explained how he is able to invest for long-term growth, freed from the shackles of immediate shareholder interests.
Michael Dell revealed the new name of his enlarged company – Dell Technologies. This will be the umbrella term for a family of businesses that encompass Dell, EMC, VMware, Pivotal, RSA, SecureWorks and Virtustream.
“The enterprise business will be named Dell EMC,” said Dell. “Flash, cloud-enabled, software-defined and scale-out are the pillars of the modern data center.”
The Cloud and Tiered Storage
David Goulden, CEO of EMC Information Infrastructure, outlined how this will play out in terms of cloud storage. He explained how some applications will remain on traditional code and platforms while others will be cloud-native using newer languages. At the same time, each of these types of apps will focus on either performance or storage capacity. Therefore, a broad portfolio of storage is needed to satisfy the market. For cloud storage, Goulden thinks the cloud will exist in multiple different forms so the company is exploiting a strategy that takes into account public, private and hybrid clouds, as well as both large and small cloud infrastructures and how these will play into a tiered storage framework. One ace up the EMC sleeve, he believes, is Pivotal, which offers a software layer that lets people build new apps.
“Pivotal Cloud Foundry is becoming the de facto platform for cloud applications,” said Goulden.
The current deal between EMC and Dell isn’t the first time these companies have worked together. Goulden pointed out that Dell sold $2 billion a year of EMC gear back in the late 2000s.
“We were only half the size back then so there are great cross synergies and sales opportunities on both sides,” he said.
The integration team consists of Rory Read, chief integration officer at Dell and Howard Elias, president and COO, global enterprise services at EMC. They are now part of the Dell/EMC Value Creation and Integration Office. They noted that the degree of overlap on the top 5000 customers was relatively small, which opened up many avenues to boost sales. All in all, it amounts to a $67 billion integration project.
“This is not an acquisition,” said Read. “This is the creation of a new company for the future which will be the largest privately owned technology company on the planet.”
Synergies in Hyperconvergence
VCE started as a joint venture between EMC, Cisco and VMware delivering a large converged box known as a Vblock. But Todd Pavone, COO of the VCE/Converged Platforms division of EMC, laid out how rack and appliance versions utilize software defined technology to create hyperconverged systems such as the VXRack 1000. He added that hyperconvergence is the biggest growth area within VCE in terms of percentage growth rate.
He sees the merger with Dell amplifying the possibilities for hyperconvergence.
“You can’t be successful in hyper convergence unless you own a server company,” said Pavone. “It is a vital element of controlling the supply chain and keeping costs down.
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