Dell Seeks Salvation in Services

Updated from 1:02 p.m. EDT

Dell(DELL Quote) is looking for salvation in services, storage and virtualization as the tech bellwether revamps its enterprise computing story.

The computer maker has felt the strain of the spending slowdown, which has hammered sales to consumers and businesses. During its recent first quarter, Dell suffered sequential and year-over-year sales declines in all areas, most notably in desktop PCs and network storage equipment.

By pushing enterprise technologies such as virtualization and consulting services, Dell is looking to reduce its exposure to the vagaries of consumer spending. The company's share price has also fallen more than 50% in almost 10 months, and CEO Michael Dell will be hoping that investors warm to his latest products and services.

The Round Rock, Texas-based firm launched a slew of products early Wednesday, including services to help customers deploy virtualization software, as well as new storage devices and PowerEdge servers.

Unlike IT hardware, which is typically a one-off purchase, services offer a recurring revenue stream, hence their attractiveness to Dell.

Dell's virtualization consulting services encompass disaster recovery, data center planning, and could be a shrewd move to harness a fast-growing technology. Despite its booming popularity, some IT managers have wrestled with the complexity of virtualization software, and its impact on their existing IT infrastructures.

Virtualization has nonetheless emerged as one of the hottest technologies in recent years, letting users make virtual versions of their hardware and operating systems. The technology, for example, can be used to run multiple operating systems on one piece of hardware, as opposed to just a single OS. Server virtualization creates multiple 'virtual servers' running in one device, all performing different functions, with the goal of ensuring that no server resources are wasted.