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Quick Take: Dell Comes Out of the Storage Closet

On Monday, Dell (Nasdaq: DELL  ) announced a networked storage system intended for small businesses called the PowerVault MD3000i. And just like that, no one cared. No one is talking about it on our discussion boards.

Too bad. On the whole, I think this is a very smart move for Dell. Storage networks are a reasonably cheap way to keep pace with the digital Everest of data that businesses must track.

Trouble is, a Dell spokesperson told me yesterday that Dell expects the MD3000i to mostly be sold direct. Who made that call? That's like booking Larry the Cable Guy for Showtime at the Apollo.

The mismatch is this: Storage devices are typically sold as part of something larger, which involves a services component. That's why Dell and EMC (NYSE: EMC  ) have long enjoyed a very profitable partnership. Dell sells the servers; EMC sells the storage arrays and software. A systems integrator is then usually called in to install and maintain the resulting system.

By choosing to go "mostly" direct, Dell is eschewing services partners who could make the MD3000i a hit. And, worse, it's blowing a ripe opportunity to become a consultative partner to fast-growing small businesses, just as IBM (NYSE: IBM  ) and Hewlett-Packard (NYSE: HPQ  ) have built reputations catering to multinationals.

It's nice to see Dell come out of the storage closet. I only wish its debut was performed with a little more finesse.


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Tim Beyers
TMFMileHigh

Tim Beyers first began writing for the Fool in 2003. Today, he's an analyst for Motley Fool Rule Breakers and Motley Fool Supernova. At Fool.com, he covers disruptive ideas in technology and entertainment, though you'll most often find him writing and talking about the business of comics. Find him online at timbeyers.me or send email to tbeyers@fool.com. For more insights, follow Tim on Google+ and Twitter.

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