Dell accelerates evolution into an IT solutions provider with Wyse acquisition

by CXOtoday Staff    Apr 03, 2012

Wyse creates an end-to-end virtualized desktop solution that better positions Dell to earn new, lucrative business globally from large enterprises, says analyst.

Dell said that it has signed a definitive agreement to acquire Wyse Technology, a cloud client computing provider, to extend its desktop virtualization offerings.

“The Wyse Technology desktop virtualization capability complements our device and computing solutions portfolio, and strengthens our position in offering customers among the broadest set of computing choices from the edge to the core to the cloud,” said Jeff Clarke, President, End User Computing Solutions at Dell.

According to US-based research firm Technology Business Research (TBR), the intent to acquire cloud client computing provider Wyse Technology is an aggressive step to bring its solutions strategy closer to its area of historical strength, PCs.

“From the core PC customer base to its newly formed software division, Dell is aligning its corporate strategy to build its reputation as an end-to-end, enterprise-calibre solutions provider to remain relevant in an IT industry migrating to “as a service” delivery models,” said Krista Macomber, Analyst at Technology Business Research.

Macomber added that worldwide PC and laptop sales are flat or struggling as customer’s transition PC infrastructures to virtualized and cloud-based environments, or seek services and other means to extend capital investments in hardware client fleets.

According to TBR the PCs contribution to Dell’s revenue and margins have declined steadily, and the company needs a solution that securely and efficiently links end points with core data centre center components, such as servers, storage and networking.

Dell’s IT services revenue reached $8.6 billion in 2011, an increase of more than 200 percent since 2008.

Macomber stated that the infrastructure demands of virtualization allow Dell to focus on areas of IT such as servers and storage, which are growing more rapidly than PCs.

“Dell will not stop selling PCs, as its vast SMB customer base relies on its machines for its everyday operations. We believe that the acquisition of Wyse creates an end-to-end virtualized desktop solution that better positions Dell to earn new, lucrative business globally from large enterprises,” she said.