The direct model did away with the old way of buying PCs. Now it’s time to apply cloud economics to the data centre and slash the management costs, says Dell’s Raj Kushwaha
This week Dell launched its Nehalem servers, along with a bid to be taken more seriously as a player in large datacentres. At the London leg of the server launch, we spoke to Raj Kushwaha, vice president of global services at Dell, to find out why the company thinks it can take on much bigger consulting organisations.
What is Dell doing in IT services – and why should we take you seriously?
We knew we wanted to dramatically change the game. For every dollar on IT hardware, another $8 is spent – and $3 of that is on services. That number keeps on growing over time. And while the IT industy is a $1.2 trillion industry with a lot of innovation in hardware, there’s not much innovation in the services side. What we wanted to do is innovate – and shrink the size of the pie.
A few years ago, we used the direct model to reduce the price of a PC, and gave some of that back to the customer. The core of our strategy is to do the same for services.
Dell’s strength is off the shelf innovation – brought together in our factory over a SaaS model. .
Now, think about what a CIO has to do to manage infrastructure. He has to buy products for system management, antivirus and software distribution, from several vendors. Before he knows it he has about ten, twelve, fourteen, eighteen different products. CIOs have to integrate them in their own data centres. They have to update them and maintain them.
What we are building over the last couple of years is an integration platform, that does provisioning for customers as well as mirroring and tracking. In that platform, we plug in the best-of-breed products. We use Symantec for anti-virus, and Iron Mountain for backup and recovery. So a customer can come in and say, “I’ve got 5000 devices, and I want to track them provide anti-virus protection on all of them, and I want to back them up”. In comes our integration platform, which is SaaS enabled, with a small agent on the laptop. Based on that agent we can manage those devices no matter where they are in the world.
Weren’t things like Openview and Tivoli supposed to deliver that kind of thing? Integrating best of breed functions for management?
Not really. They are closed proprietary systems – and on-premises. Our model is open systems, best of breed and SaaS delivered. The backbone of what we have is all SaaS and cloud. The reason behind it is to minimise the deployment cost, and the total cost of ownership and take away the complexity of integrating separate products.
Our business model is subscription based; that’s the second piece of what we are going after. We W don’t believe customers should have multi-year lockins or multimillion dollar contracts for services. We believe they should be able to consume what they want and pay for what they consume. It’s subscription based, turn-on/turn-off, and modular.
So our business model is very different from the competition.