Bill Kreher, an analyst at Technology Business Research (TBR) told TheStreet that Dell wants to emulate IBM ( IBM), Oracle ( ORCL) and HP ( HPQ), which are touting a mix of hardware and services to customers."It appears as if the company is trying to move towards a one-stop shop approach," he said. "
ROUND ROCK, Tex. ( TheStreet) -- Dell ( DELL) CEO Michael Dell, who kicks off the company's annual customer event on Wednesday, must be loving every second of the PC turmoil at rival HP ( HPQ). The no.1 PC maker's potential Personal Systems Group spinoff has proved highly controversial, contributing to the ouster of former HP CEO Leo Apotheker. The question mark hanging over HP's PC business, however, spells good news for Dell.
"In the short term, Dell, Lenovo and others will benefit from the uncertainty HP clients feel," explained Jay Chou, an analyst at tech research firm IDC "Given Dell's repeated assertion of its commitment to PCs and its emphasis on business customers (remember Dell was the number one PC maker in the US not too long ago), Dell is the most likely one to benefit from HP's missteps." Avid trash talker Michael Dell has already aimed some barbs at HP, clearly reveling in his rival's discomfort. "If HP spins off their PC business ... maybe they will call it Compaq?," Dell crowed when HP announced its shock restructuring, referring to the PC maker's tough $25 billion merger with Compaq. In addition to exploiting HP's problems, Dell should also shrug off broader PC market weakness, according to IDC's Chou. "We believe that while PCs have slowed down, we are by no means in a post-PC period," he wrote, in an email to TheStreet. "There is so much more to do in emerging markets (China is now the biggest PC market in the world) and Dell has done quite well in emerging markets." Adrian O'Connell, a research director at Gartner, agrees that there are still plenty of PC dollars available. ""There's a lot of flak that the PC industry is taking and some of that is overdone," he told TheStreet. "We need to re-set what we think of the PC industry - yes, it's not the fastest-growing part of the market
but it's still a growing market." Dell has already noted softness in consumer PCs; although this has been offset by strength in enterprise, an area which looms large in the company's future. The Round Rock, Texas-based company grew its enterprise solutions and services revenue 4% year-over-year during its recent second-quarter results, while consumer sales gained just 1%. Server and networking sales climbed 9% and Dell's storage business grew 15%.
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