The 10 Biggest Dell Technologies News Stories In 2019
CRN breaks down the ten biggest Dell Technologies news stories – from the Dell Technologies Cloud to the retirement of Marius Haas – of 2019.
Here Were The Most Important Dell Stories In 2019
It was quite a ride for Dell Technologies in 2019 as the company successfully finished its first year as a public entity. The Round Rock, Texas-based $91 billion infrastructure giant was consistently in the news cycle throughout the year with critical launches like the Dell Technologies Cloud and new tightly integrated VMware solutions as well as overhauls in the company’s flagship partner program and go-to-market sales strategy.
“We’re quite excited about what we’ve achieved this past year, but momentum continues into next year with lots of opportunity for channel partners,” said Dell Technologies CEO Michael Dell in a recent interview with CRN.
CRN breaks down the ten biggest and most important Dell news stories of 2019.
Get more of CRN's 2019 tech year in review.
10. Dell Hits The Public Market; Stock Fluctuates Throughout 2019
Dell Technologies entered the public market on Dec. 28, 2018 following a $24 billion cash and equity deal though a VMware stock swap. The move came two years after Dell’s historic acquisition of EMC and VMware in 2016, which was followed by massive integrations in terms of both technology and business operations. “The whole goal here is to align economics and equity and trust,” said Executive Vice President and CFO Tom Sweet in an interview with CRN.
The company debuted on the New York Stock Exchange at $46 per share under the ticker symbol ‘DELL’. The stock rocketed to near $70 per share in May that gave investors a 52 percent profit in around five months. However, Dell’s stock fell significantly after reporting its first fiscal quarter earnings. Over the past six months, Dell’s stock price has mostly fluctuated between the high $40’s and low $50’s per share. The company’s stock has been hovering around $47 to $50 per share in December. After its first 12 months on the New York Stock Exchange, Dell’s stock is slightly up from where it started.
9. Hyperconvergence Domination
Simply put, Dell Technologies dominated the hyperconverged infrastructure market in 2019, blowing out all the competition thanks to its flagship HCI offering, VxRail, co-engineered with VMware. With the hyperconverged infrastructure market is on pace to reach $7.2 billion in 2019, Dell planted its stake in the ground this year as the worldwide market share leader, outpacing all competitors significantly.
Dell currently owns 35.1 percent share of the global HCI systems market as of the third quarter 2019, up from 29.3 percent share year over year, while VMware owns 38 percent share of the hyperconverged software market. Together, Dell Technologies generated well over $2 billion in hyperconverged revenue.
“We have a super strong position [in hyperconverged infrastructure] and it’s only getting stronger,” said Michael Dell in a recent interview with CRN. “So we’re No. 1 and we’re more than twice the size of No. 2 [Nutanix]. We have our sights set on being three-times, four-times, five-times, six-times bigger than No. 2.”
8. Dell Server Sales Slump
Dell Technologies generated more server revenue and sold more servers than any other company in the world in 2019. However, the company’s server sales dropped double-digits in every fiscal quarter year over year compared to 2018.
Dell executives attributed the server slump to a large sales drop in China, due to the ongoing trade tensions with the U.S., as well as Dell pulling back on large deals it deems unprofitable. “We were consciously more selective on larger server deals during the quarter, particularly in China and we focused on acquiring new customers and balancing topline and bottom line results across the entire server business. The result: a decline in revenue, but with higher profitability,” said Jeff Clarke, Vice Chairman, Products and Operations, during Dell’s first fiscal quarter earnings call in May. “The aggressive pricing in [China] for those opportunities was below our profit threshold.”
Michael Dell told CRN that he expects server sales to rebound in 2020. “It’s going to be a better year next year,” Dell said. “Last year, was rather extraordinary for servers if you recall. We were posting quarters where we were up 30 percent, 40 percent, in a huge industry space. We remain No. 1 in servers in both revenue and units. We’re also doing a lot in our blade servers with our MX platform and integrating networking and servers together. Last year was huge in servers. This year, there’s been a bit of a digesting in all of those server investments. Next year, I think we’ll see it pick back up again.”
7. Dell Technologies Plants Its Kubernetes And Containers Stake In The Ground
Dell Technologies is made up of several market-leading brands including Boomi, Dell EMC, RSA, SecureWorks, Pivotal Software, Virtustream and VMware. One of the company’s biggest investment and innovation areas in 2019 was around containers and Kubernetes with VMware and Pivotal leading the way.
Michael Dell said he’s expecting to become the Kubernetes kingpin in 2020 thanks to the investments made this year including Tanzu and Project Pacific, which unites vSphere and Kubernetes to create a platform for modern applications that offers consistency across all different environments.
“We are rearchitecting a core product of VMware vSphere into a Kubernetes native platform. This is super powerful and important because we’re bringing together our application development and our infrastructure management platforms into one combined capability,” said Dell. “Obviously, Kubernetes has taken off because of the recognition that nobody wants to be locked-into any particular form of infrastructure. So Kubernetes is really essential to a multi-cloud architecture and by building it into vSphere, and bringing it to the 600,000 vSphere customers around the world, we believe we’re super well positioned.”
6. Dell Drives Tighter VMware Integrations, More Synergies
The integration and co-engineering between Dell and VMware hit an all-time high in 2019, which has been paying off in big channel sales gains. Hundreds of VMware and Dell engineers are now working hand-in-hand to drive innovation together.
Dell and VMware unveiled this year perhaps its most significant cloud collaboration ever with the Dell Technologies Cloud, which will later be discussed on this this. Additionally, Dell launched its new PowerOne autonomous infrastructure that combines all of Dell EMC’s flagship infrastructure products together with VMware vSphere in a single architecture with future plans to integrate VMware Cloud Foundation into the mix.
The two companies have doubled down on hyperconverged infrastructure integration around VxRail, launched a new SD-WAN solution together as well as a launching its blockbuster joint Unified Workspace to radically change end-user computing. Unified Workspace integrates VMware Workspace ONE device management with products and services from Dell Technologies and security specialist Secureworks, who is also owned by Dell.
“We see that these technologies and the momentum that we’ve built, the solutions that we’ve architected over the last 18 months, is really positioning us like no one else,” said VMware CEO Pat Gelsinger at Dell’s Global Partner Summit this year. “We’re seeing this relationship as gaining momentum. We’re seeing it as enabling these new solutions. We’re partnering across our ecosystem, but this relationship with Dell and VMware is unique and powerful. We have defied gravity.”
5. Dell’s Storage Assault
Dell remained the dominant worldwide storage market share leader throughout 2019, owning 31.5 percent share of the global external storage systems market, while also launching a slew of new storage innovations this year. The company recently reported storage sales hit $4.1 billion in the third quarter alone, up 7 percent year over year.
“The quarter we just finished, our storage business grew 7 percent. When you can look at most of our competitors, they were down -- minus-10 percent, minus-15 percent – we’re clearly gaining share in storage. We’re already bigger than No. 2, No. 3 and No.4 combined,” said Michael Dell, in an interview with CRN.
Additionally, Dell unveiled its new midrange Dell EMC Unity XT Series this year that delivers up to 2X performance, 5:1 data reduction and purpose-built for a multi-cloud world. The NVMe-ready Unity XT features a combination of software enhancements and the latest generation of Intel processors. Overall, Dell expanded on much of its storage portfolio in 2019 including a new range of cloud storage services, enhancements to PowerMax, unstructured data solutions and a new line of data protection software and appliances.
Ahead for Dell is its new container-based midrange storage line which will be launched by February. "It is going to be a modern file system and modern software stack – better described as, it's going to be a microservice-based architecture and a container-based architecture," said Dell’s Jeff Clarke in an previous interview with CRN. "[It’s] going to be a platform for us to go from NVMe to NVMe over fabric to storage-class memory to memory persistent architecture over time.”
4. ‘This Industry’s Broadest Consumption Based And As-A-Service’ Sales Model
In one of its biggest sales transformation initiatives in years, Dell Technologies fully embraced consumption-based pricing models in 2019 as more business seek pay per usage and as-a-service buying options. The company is leveraging its Dell Financial Services arm to enable channel partners to sell products – ranging from Dell’s new autonomous PowerOne infrastructure and Dell Technologies Cloud to its PowerEdge server and PC-as-a-Service portfolios -- in a variety of consumption-based offerings.
In November, the company made its boldest launch with Dell Technologies On Demand, allowing businesses to procure nearly all of the Dell EMC and VMware solutions in three flexible consumption offerings: Pay as You Grow, Flex On Demand and Data Center Utility. Flex on Demand allows customers to acquire elastic capacity and only pay for what they use, while Data Center Utility establishes a pay per use environment across the entire IT infrastructure. Pay as You Grow includes customized payment solutions to support forecasted growth, flexible deployment schedules, deferrals and pre-provisioned upgrades.
“Our offer is the broadest in the industry bar-none,” said Sam Grocott, senior vice president for marketing at Dell Technologies, in an interview with CRN this year. “It’s the industry’s broadest consumption-based and as-a-service delivery model that is ideally suited for the way on-premise infrastructure and services are consumed today.”
3. Dell Forms New Flagship Partner Program
It was a new day for Dell EMC channel partners on April 29 as the Dell EMC Partner Program officially ended to make way for the game-changing Dell Technologies Partner Program. The new program aims to drive channel sales to the next level by making it easier and more profitable for partners to sell across the entire Dell Technologies portfolio – which includes Boomi, Dell EMC, Pivotal, RSA, SecureWorks, Virtustream and VMware.
Although still in its infancy, the program’s goal is to allow partners to seamlessly buy, procure and sell solutions across the Dell Technologies family of businesses. All products purchased through the program, regardless of the family of business, will count toward the tier status and tier revenue requirements in the new program. A major benefit of the program will be around certification simplification to cut out unnecessary repetitiveness and allow partners more time in the sales field rather than the training room.
“It brings a simplified access to the breadth of technology and portfolio on how they can uniquely help customers through their transformational journeys,” said Cheryl Cook, senior vice president of Global Partner Marketing for Dell EMC, in an interview with CRN earlier this year. “They can now team and align with our sales force through teaming agreements and joint account planning on really realizing the maximum opportunity.”
2. Marius Haas Leaving As New Sales Organizations Created
In a move that sent shockwaves through Dell’s channel community, President and Chief Commercial Officer Marius Haas unexpectedly announced his retirement in December, with plans to officially leave in February. Haas helped establish Dell, EMC and VMware as a combined technology powerhouse and is widely credited with successfully integrating the massive Dell and EMC channel organizations. He was in charge of a whopping 500,000 commercial customer accounts for Dell.
At the same time of Haas’ signaled departure, Dell unveiled that it will merge both its commercial and enterprise sales organization into one, combined entity. Longtime Dell EMC veteran Bill Scannell, Dell’s current president of global enterprise sales and customer operations, will lead the new unified sales organization.
In a recent interview with CRN, Scannell explained his bullish plans to drive a new level of go-to-market simplicity and channel partner synergy.
“This organizational change is really to simplify our go-to-market, make it easier to do business with us and make it easier for the partners to engage with us,” said Scannell. “We’re going to continue to work with partners. We’re going to continue to sell solutions and we’re going to continue to be the biggest, most professional, most strategic technology company in the world – supported by a great channel organization across the globe. … I’ve certainly been involved with the channel and direct sales my entire career, 34 years now. I’ve never been more excited in how well we as a company are positioned today.”
1. ‘The Best Hybrid Cloud Platform On Earth’
In its biggest product launch of the year, Dell Technologies unleashed the Dell Technologies Cloud, creating its flagship hybrid cloud, data center as-a-service architecture. The new consumption-based Dell Technologies Cloud is made up of two similar offerings with the same foundation of VMware Cloud Foundation (VCF) integrated with hyperconverged infrastructure VxRail. One offering, Dell Technologies Cloud Platforms, includes VxRail and VCF with additional product options including Dell EMC servers, storage and networking products that can be sold and managed by channel partners. The other offering is Cloud Data Center-As-A-Service which includes VxRail, VCF and VMware management that is fully managed by Dell Technologies that can be sold by partners.
Dell Technologies Cloud began shipping this year with “off the charts” demands. The creation of the hybrid cloud architecture showed that Dell was more than ready to enter the data center as-a-service race by allows customers to buy Dell Technologies Cloud in a variety of options including Opex, lease, consume as-a-Service or pay per use.
“This is our opportunity to say, ‘Look, this is the best hybrid cloud platform on Earth,” said Matt Baker, senior vice president, Dell EMC Strategy and Planning in an interview with CRN. “We need to tell the world, ‘Look, this is the best way to build your hybrid cloud.’ Customers want a consistent operating environment. … Dell and our channel partners now have a well-oiled hybrid cloud platform that can be used to help our customers achieve their cloud ambitions.”
Michael Dell recently told CRN that his company will be “investing heavily” in the Dell Technologies Cloud in 2020.