Michael Dell: “Public Cloud Market Too Crowded”

As HP, Cisco and other IT players begin funneling into the public cloud market place; it’s surprising to some analysts that a new newly privatized Dell has shied away from building out a public cloud infrastructure. Dell has a rolodex that is full of corporate IT managers that have previously inked hardware and software deals in the past. Why not build out a public cloud and use those contacts as a sales vertical?

In an interview provided to CRN, Michael Dell was candid about his thoughts on the public cloud. Dell said, “I think the public cloud is a crowded space, with lots of guys playing there. In terms of building a public cloud to compete with partners, we are not doing that at all.”

What exactly is Dell’s cloud strategy? Michael Dell went on to say, “We have taken a different approach here. Instead of competing with all of those service providers and telcos, we are enabling them. There are also a number of firms out there like OnApp that are integrating our hardware platform and allowing VARs to create their own cloud platform.”

While other companies are investing billions in building out the public cloud for their end users, Dell’s strategy is to simply facilitate these build outs. This strategy should work out well for Dell because Dell does not look to make any enemies. For example, could you imagine a public cloud service wanting to work with a hardware provider that is also competing alongside of them in the same space?

Dell’s commitment to hardware will keeps its company focused on private cloud infrastructure. Many analysts including Michael Dell himself believe that this direction is much better as a business model. Dell is staying true to what they have built their brand upon and with research firms such as Gartner believing that private cloud infrastructure spending will triple in the next couple years, Dell’s positioning and refocus could not come at a  better time.