- Jack Lau
Dell-EMC US$67 Billion Deal --- relevant to anyone here?
US$67 billion is a lot of money. This is probably one of the largest deals we have seen and will see for a while. And, does it have anything to do with us? Well, most consumers are more familiar with Dell computers. Michael Dell started the PC company when he was still a college student. It was famous for its business model --- you order your computer on line. Even nowadays, this practice is somewhat novel, especially in our part of the world.
And, EMC.... that is more complicated. But, it covers a number of important areas. If you are in cybersecurity, you must have heard of the company RSA. A number of executives still need to carry a RSA token which generates a secret code real time for people to log on to their company network.
The name EMC has also conjured much fear and respect in this part of the world. I do remember hearing people in China not long ago saying that this is one of the pillars of technologies they would much rather have developed on their own.
And, VMWare, a big part of EMC, is itself a US$6.5 Billion (revenue) company.
a. This is really a merger between hardware and software. Can we see anything like that coming in this part of the world? Dell has a lot of counterparts in Asia in the PC sector: Lenovo, Asus, Acer, etc. Probably less so on the server side though. (Yes, someone did mention to me about Huawei and ZTE, but they seem a bit different.) And, the like of EMC in this part of the world is more difficult to find around this region. Yes, actually, Huawei has been either the number 1 and number 2 storage player in China as well, and yes, Huawei clearly is into the security business. But, traditional wisdom has it that the Dell/EMC competitors are more like that of IBM and HP. As a matter of fact, most of the software company in this region are really consumer side and not industrial kind. The question is, would we see the rise of the like of an EMC like company in this region? As a standalone or as part of the bigger hardware company?
b. Would the new Dell-EMC combo have an easier time in China, or not? Lenovo has been trying a alliance with EMC on storage. With the new Dell-EMC deal, Lenovo probably has to figure out an alternative strategy.
c. Who would be under threat with this new deal? And, who would benefit?