THE WALL STREET JOURNAL.
2013, 7:40 PM
Dell Talks Up Its Software
By Shira Ovide
Dell’s top software executive.
Dell may be in Wall Street’s doghouse for
its reliance on sales of unloved hardware like personal computers. But the
company sees a bright future in software.
an event Wednesday in San Francisco, Dell executives outlined ongoing
efforts to stitch together software and tech services the company has
scooped up in a recent-years acquisition spree, as Dell seeks to morph into
a mini-IBM with a range of software products and other corporate technology
boasting better profit margins and loftier growth prospects.
Dell executives discussed
software to help companies that are struggling to keep tabs on the
smartphones, tablet computers and other personal devices they take from
home, and expect to use for workplace tasks. Dell also talked about a new
version of a service
CA called Toad Business Intelligence–one Dell executive joked about the
odd name–for mining company databases for useful information.
the event, Dell software boss John Swainson described software as the “glue”
that holds together the hardware parts of the company, and newer
information-services products. (Swainson also apologized for wearing a suit
and tie–not a typical wardrobe in the software industry, or in San
Francisco. He explained the formal wear was for a Visa board meeting.)
says its software businesses are on track for more $1.5 billion in annual
revenue, though the company hasn’t detailed when that figure would be
The product focus comes at a key
time for Dell, which is seeking to keep its employees and corporate
customers focused amid the noise around a proposed $24.4 billion offer to
buy out the company’s public shareholders. That offer, led by private-equity
firm Silver Lake Partners and Chief Executive
has faced opposition from some large shareholders.
an interview, Mr. Swainson said Dell’s customers haven’t really been asking
about the buyout deal. He said the buyout doesn’t change Dell’s approach to
products, nor its relationship with customers.
Swainson, asked what people would find surprising about Dell’s efforts to
become a software-and-services company, singled out the speed of the
company’s transformation. “I think it’s further along than people would
think,” he said.
That wasn’t the opinion of
Blackstone Group. The private-equity firm last week dropped its efforts
to put together a rival buyout bid for Dell. Blackstone officials reviewing
Dell’s financials and strategy worried it would take too long for Dell’s
software and corporate-technology offerings to get to the size and scope
needed to compete effectively, people familiar with Blackstone’s position
Mr. Swainson, a veteran of
IBM who also helped software company CA Inc. recover from an accounting
scandal, had stepped away from operating roles when he retired from CA at
the end of 2009. Then Mr. Dell last year swooped in to ask if Mr. Swainson
would help build Dell’s software business from scratch.
Swainson said he didn’t need too much arm twisting. “This was something new
and exciting and different – and frankly hard,” he said.
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