Dell Pays $67 Billion for EMC

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Huge purchase will help Dell face off with huge competitors like Microsoft, HP, and IBM.

Dell has announced that it is buying the storage and enterprise technology giant EMC. The $67 billion price tag is considered the largest tech purchase in history. According to the press announcement, “The combination of Dell and EMC will create the world’s largest privately controlled, integrated technology company …. The transaction combines two of the world’s greatest technology franchises with leadership positions in servers, storage, virtualization and PCs, and it brings together strong capabilities in the fastest growing areas of the industry, including digital transformation, software-defined data center, hybrid cloud, converged infrastructure, mobile, and security.”

Dell got its start selling home and small office PCs, but hardware vendors have known for years the real money is in corporate contracts with enterprise clients. The company has succeeded in bringing itself into the enterprise space, but it is behind some of its larger competitors in recent technologies such as virtualization, private cloud, and Big-Data-style storage solutions. This deal should keep them in the conversation with competitors such as Microsoft, Oracle, IBM, and HP.

Some experts, however, are baffled by the announcement and warning of risks associated with combining two such large and disconnected companies. The biggest prize in the EMC portfolio is the popular VMware virtualization solution and its surrounding technologies. VMware will fit well into the pitch Dell needs to make with large enterprise clients.

10/14/2015

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