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Just what is Dell's cloud strategy?

Brandon Butler | Sept. 14, 2012
Dell's agreement to offer a public cloud hosted by Nirvanix leaves open the question of the company's long-term strategy.

Last week a curious announcement came from Dell: A tweet from one of the company's corporate Twitter accounts pointed to a PDF announcing a new public cloud storage service from the company.

Well, sort of. Dell announced an agreement to sell public cloud storage from Nirvanix, an infrastructure as a service company that's slowly building a notable resume, including its ongoing partnership with IBM to provide a cloud storage option for Big Blue.

For years there have been rumors about Dell's cloud strategy. Will it launch its own cloud to go up against Amazon Web Services, as HP has done? The flurry of acquisitions Dell has made during the past few years, combined with its enthusiastic support of OpenStack, had some in the industry waiting for a big news announcement from Dell of a public cloud offering. Instead, it announced through Twitter a new option for Dell customers to access Nirvanix's cloud. "The announcement in some ways raises more questions than it answers," says Terri McClure, analyst at Enterprise Strategy Group.

Dell has a lot of irons in the fire, says Andrew Reichman, a Forrester storage analyst. It sells traditional hardware storage options for use in the data center, such as its PowerVault direct attached and network attached appliances. Then there is the company's cloud, in which customers can rent servers from Dell in a multi-tenant (public cloud) or dedicated server variety (private cloud). Through other reseller programs Dell offers public cloud storage software from Caringo, or it will manage applications in the cloud. Dell's approach, says 451 Research Group analyst Carl Brooks, is to "throw everything up against the wall and see what sticks."

In that sense, Dell syndicating Nirvanix's public cloud storage is merely filling out the company's product portfolio, he says. Dell wants to be able to serve any type of cloud customer, from the services providers that may leverage Caringo to create their own cloud, to large enterprises looking to try out OpenStack by using Crowbar, a framework Dell created to more easily launch OpenStack-powered clouds . "They've tried everything," Brooks says. "But (they) aren't Amazon, and they don't want to forever be third runner-up to IBM and HP, so they found something they can do well, which is sell you lots of different stuff in a very easy fashion."

So does the Nirvanix deal mean that Dell has given up on plans to create its own Amazon-style cloud? Dell representatives did not reply to a request for comment on the Nirvanix news, but Brooks doubts the company could justify the large investments required to build up the massive data center infrastructure it would take to compete head-to-head with Amazon and other IaaS players.


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