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Dell/EMC Draw Mixed Reviews

PC slump drives $67B acquisition
10/12/2015 11:30 AM EDT
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MeasurementBlues
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Re: Local sneers
MeasurementBlues   10/13/2015 7:00:40 PM
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@TonyTib

ADI does still have the Wilmington fab, though it hasn't been used for production in at least 10 years. It's for prototypes and preproduction engineering evaluation parts.

See The world is still analog, a piece I wrote in 2006 from a visit to Wilmington.

TonyTib
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Re: Local sneers
TonyTib   10/13/2015 6:44:18 PM
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Doesn't ADI still have a fab in Wilmington, MA?  The other fab is in Ireland, and they outsource, too (e.g. digital to TSMC I believe).

Of course, some people in Boston still believe it's the center of the world...

MeasurementBlues
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Local sneers
MeasurementBlues   10/13/2015 5:57:11 PM
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I sensed a bit of a sneer fron the local newspapers about a Texas company acquiring a Massachusetts company. We heard the same sneers when Proctor & Gamble acquired Gillette and IBM acquired Lotus. Of course, there have been plenty of small companies acquired and jobs lost, but that doesn't make news.

Mass. is becoming more software, services, medical devices, and pharmaceuticals. The economy is growing if you're inside the I-495 belt. Housing prices are rising and urban areas (Boston, Cambridge, etc.) are hot. There are still plenty of electronics companies in the area, but EMC was kind of the last dominant one. We still have Analog Devices, although the manufacutring is all overseas.

MeasurementBlues
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Local perspective
MeasurementBlues   10/13/2015 11:51:53 AM
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Here in Boston (EMC headquarters), fear of layoffs is running high. We all remember what happened when Compaq (another Texas-based PC company) bought Digital Equipment.

From today's Boston Globe:

The takeover of EMC Corp., announced Monday, marks the end of the state's "Big Iron" era, subsuming the last of the big corporations that made Massachusetts a manufacturing center for powerful minicomputers and servers that helped spark a global revolution in technology.


"Christopher Anderson, president of the Massachusetts High Technology Council, a trade group in Waltham, said the prospect of losing the corporate headquarters of EMC, the state's fourth-largest publicly traded company, is under no circumstances a good thing for Massachusetts"

From "Six thoughts about Dell's $67 billion acquisition of EMC:"
These kinds of deals tend to be thrilling mostly to investment bankers and private equity wheelers

Towns worry about local impact of EMC sale

As always, the workers are the ones who lose.

DMcCunney
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It's all about Amazon
DMcCunney   10/12/2015 7:50:21 PM
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This is about Amazon and cloud services.

The cloud is the current big thing, and Amazon is the leader in cloud services.  Everyone else is playing catchup.

Dell went private in an LBO to escape market expectations for revenues and profits that it could not meet.

But the PC market isn't one big undifferentiated mass. The consumer PC market is brutal, with whose name is on the label largely irrelevant and competition mostly on price, where Lowest Cost Producer wins.  IBM bailed out of it, and HP announced plans to do so under the previous CEO because they couldn't be lowest cost producers and make money.

But while Dell was active there, they were also active in the server, storage, and networking segments, and this move affects them.

Cloud services require cloud storage, and Dell wants to be a supplier of the servers, storage, and networing gear cloud service providers will use to provide the services.

Without a public equity market fixiated on growth, Dell has more breathing room to make moved like this.  EMC already owned encryption specialist RSA, and  leading virtualization specialist VMWare.

It will be a while before the dust settles if this deal goes through, but if it does I expect to see Dell offerings specifically targetting the enterprise and the cloud services space, combining servers, virtualization, encryption, and massive storage in integrated packages.  And I would not be surprised if Dell simply dropped out of the consumer PC market entirely.

Dennis

rick merritt
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Re: I wonder about culture fit
rick merritt   10/12/2015 5:42:44 PM
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@TonyTib  Culture is a good question and one the hurting computer ndustry probably doesnt have much time for these days.

Facebook is a good example of a cloud company that needs tons of storage. Most clouds are moving toward richer media and need all the storage they can eat methinks

 

TonyTib
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I wonder about culture fit
TonyTib   10/12/2015 1:36:44 PM
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between MA and TX.

I'm not sure how well EMC positions Dell for "the cloud" since EMC makes enterprise storage devices typically not used by cloud providers (because of their high cost per Terabyte).

Also, note that HP bought a enterprise storage provider years ago, 3Par, and supposedly 3Par is doing great under HP (one acquisition they didn't screw up).

rick merritt
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Another view
rick merritt   10/12/2015 1:26:17 PM
Analyst Rob Enderle says this deal means "HP is screwed"

http://techspective.net/2015/10/12/dell-emc-hp-is-screwed/

 

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