Once upon a time — not long ago, actually — Dell thought it was poised to become Cisco Systems’ indispensable data-center ally.
As Del understood the world back then, Cisco would provide the data-center network infrastructure and Dell would provide the data-center servers. The companies both had storage and virtualization partnerships, and they could serve those needs as required, too.
Some within Dell even entertained the possibility that Cisco, which was considering a converged data-center strategy, would opt to OEM servers from Dell. Few within Dell imagined that Cisco would go from being partner to competitor.
But that’s what happened. Dell has been reeling since then, trying to determine how best to answer the data-center threat posed by Cisco’s Unified Computing System (UCS) and the countering thrusts from HP and IBM.
Perhaps belatedly, Dell has found its answer. While it retains a reseller relationship with Cisco, Dell’s newly expanded OEM relationship with Brocade Communications Systems will take precedence for Dell commercially and strategically. Dell will put its own label on the data and storage switches it will OEM from Brocade — it previously resold Brocade’s storage-networking gear — and it will share revenue with Brocade. The two companies also have committed to work together on the development of new data-center products and technologies, including virtualization solutions.
In some ways, Dell is making a virtue of a necessity, as suggested by Timothy Prickett Morgan at The Register. Dell cannot afford to buy Brocade or another major networking vendor. In a sense, Dell is like an NFL team with several personnel holes to fill and a limited budget with which to do it.
Still, the number-two PC purveyor is counting on the enterprise for future prosperity. When Cisco, followed determinedly by HP and IBM, made its unilateral move for data-center hegemony with UCS, Dell needed a rejoinder. Standing pat wasn’t an option.
Like IBM, Dell will position itself as a solution provider and master integrator, bringing together its own servers with networking gear from Brocade and others, offering an alternative to Brocade when customers are insistent about having one. It will have storage options, too, though it might make an acquisition or two in that space to address mid-market enterprise requirements.
The trouble with the strategy, especially in the largest enterprise accounts, is that Dell lacks IBM’s professional-services panache. IBM is bigger and better at being a services-driven trusted partner.
HP has chosen a different path, opting for a direct, head-to-head competitive showdown with Cisco. Like Cisco, HP will provide a complete, mostly in-house, end-to-end solution for the converged data center. HP already owned its ProCurve Networking business, having dithered and procrastinated when it had an opportunity to spin it off or sell it to Francisco Partners a few years ago.
That decision, or failure to make a decision, might yet pay dividends, though HP will have to fill gaps in its core networking portfolio, with strategic partnerships or acquisitions, if it wishes to challenge Cisco’s full networking breadth and depth right across the board.
Dell is at the table now, too. It doesn’t have as many poker chips as HP or Cisco, but it’s playing the hand it’s been dealt. Unfortunately for Dell, Cisco dealt that hand when it chose to go its own way in fashioning the UCS platform.