Did you expect
to step out of line?
Last week Dell penciled a check mark in the "against"
column, or so onlookers interpreted when
CEO said on the fourth-quarter earnings call that
wouldn't give the computer maker a big revenue jump. The long-anticipated version of Microsoft's new operating system software, Windows 2000, could cement Microsoft's stranglehold on all segments of computing -- and singlehandedly push corporate computer users into a frenzy of hardware upgrades.
But by Tuesday morning he was scrubbing away at that remark with a pink eraser, speaking in front of several hundred members of the Windows 2000 fan club at the Bill Graham Civic Auditorium.
This is the way things have been going for Windows 2000 in the new era of unbridled antipathy toward Microsoft: The software giant invites Dell to kick off its week-long launch celebration, the
Windows 2000 Conference and Expo
in San Francisco, and Dell shoots his mouth off right before the gala is about to begin.
But did he really? Could Michael Dell be straying from the faith? The innocent man who made himself look foolish defending Microsoft at
hearings long before the
Yes and no.
Dell defended his comments from last week at a postkeynote press conference. "The adoption rate of Windows 2000 won't be determined by my speeches," he said with a cut-me-some-slack smile. "We as a company don't like to promise that 50% of our customers are going to be deploying Windows 2000. We'd like for that to happen, and then we'll talk about it."
So we exaggerated his words. He was just using squishy language to answer a future earnings question.
Well then, let's look at his body language. Yes, he kept to the Microsoft party line for most of his talk. He insisted that
is running on Windows 2000 like a filly. Also, Dell has helped
and several large educational clients get Windows 2000 running. Finally, the obligatory Windows 2000 demo showed Dell.com's performance boosted 20% on Windows 2000 over
Windows NT 4.0
, Microsoft's last version of operating software for servers.
But follow the bouncing ball: Dell said his company would launch a Dell hosting business for data centers in a few weeks. Dell repeatedly mentioned
Dell Technology Services
, the boxmaker's services arm. And, Dell took his most pointed shots at
. His servers are swifter, higher, stronger than Sun's -- or so he says. Sun poses a much different kind of rivalry than age-old Dell nemesis
. Sun isn't just a boxmaker, and Sun's growth looks a lot better than Compaq's.
Conclusion: Dell wants to fill more than just your hardware needs. It wants to sell its customers everything. If everything doesn't include Microsoft -- well? Dell's going to have to stray from the Microsoft-zone.
Of course, Microsoft would like all of Dell's customers to run Windows. Windows 2000 is aimed squarely at the low-end server market and is meant to put Microsoft at the forefront of e-commerce and e-business applications. Follow Microsoft's dream scenario: Individuals use Microsoft
. High-powered database users pony up for
software, Microsoft's answer to
database programs. In between, where all the piddling e-commerce revenue is pooling, you can now buy Windows 2000. Expect a consumer version of Windows in a few months -- as Dell admitted, the current version's $295 price point is a little steep for consumers -- never mind the 650 megs of hard drive the beast demands.
Dell most frequently referred to "seamless integration" as Windows 2000's big benefit. It's all Microsoft; it (almost) all should work together, theoretically. One of the most talked-about elements of Windows 2000, Active Directory, is aimed at the network-service management segment you've heard
CEO Eric Schmidt talking about for several years. That means Microsoft would keep track of all your identities and the activities across the network.
This is where the "against" column populace gets goose bumps and breaks out in a cold sweat. Plus, Microsoft everywhere means Windows 2000 users won't be able to play easily with other software.
Good for Microsoft. Not good for others.
It's safe to say Dell has to inch toward the "others" crowd if it wants to meet all its users needs in the services and data center departments. It's already signed on to preinstall
for customers who've been drawn to the open source option. But it's still got to pledge allegiance to Windows to get the bulk of the Microsoft-happy corporate business.
For the time being, count Dell firmly among the Microsoft supporters. But it remains up to Windows 2000's success to keep Michael Dell at attention.
Tish Williams' column takes at look at the people who make Silicon Valley tick. In keeping with TSC's editorial policy, she doesn't own or short individual stocks, although she does own stock options in TheStreet.com. She also doesn't invest in hedge funds or other private investment partnerships. She waits breathlessly for your feedback at