Dell on quest higher into enterprise

With its position in the PC market well established, Dell has proclaimed its desire to double the company’s size and to target the corporate market to drive future growth.

Analysts contend that Dell’s largest obstacle to attaining this brash goal will be an economy gone sour.

Dell executives claim customer demand for inexpensive hardware to run standard systems such as Linux or Windows is on the rise, positioning Dell well to steal server market share from its rivals. The Round Rock, Texas-based company is also looking to storage and services as growth areas and has diversified its product portfolio with printers and handhelds.

“The push toward industry-standards-based systems is moving higher and higher up into the enterprise,” said Dell Chairman and CEO Michael Dell. “Standards are the future of enterprise computing.”

As part of its effort, the company is tightening ties to several major enterprise vendors, notably Oracle. The two companies last week detailed new low-end clusters that run the Oracle database in conjunction with either Red Hat Linux or Windows.

The two companies also said their consulting organizations will partner on a new set of professional services aimed at customers migrating from legacy systems to an Oracle9i database deployment on Dell server and storage hardware. 

“Dell is commoditizing servers and storage in the same way it has the PC,” said Tom Lahive, an analyst at Milford, Mass.-based Enterprise Storage Group.

But one financial analyst stressed that the economy is a critical factor in Dell’s strategy.

“We remain concerned over the deterioration in industry IT demand since late January, especially in theU.S., with some potential signs of a slowdown inEurope,” said Dan Niles, an analyst at New York-based Lehman Brothers.

Scott Tyler Shafer contributed to this report.