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Dell (Nasdaq: DELL ) has introduced a fresh set of servers, networking products, and storage boxes that bolster the company's status in the data center. These new products are designed to work together so that customers can get end-to-end computing solutions from one vendor. The idea is that everything should be optimized to work together right out of the box.
If that sounds a lot like the next IBM (NYSE: IBM ) , you're on the right track. There are no guarantees that Dell will get there, but that's the company's Big Blue ambition anyway. It's a multi-horse race as Cisco Systems, Hewlett-Packard, and Oracle all rush to copy IBM's proven business model. Of these, I think Dell and Cisco are off to good starts while HP could use a reality check and the jury is out on Oracle.
So Dell's overarching goal is not exactly news, but you wouldn't know it reading this week's headlines. The popular angle is that Dell isn't a PC company anymore. Well, if that's what you thought of Dell, you just haven't been paying attention.
Sure, CEO Michael Dell and a handful of other high-ranking executives underscored the "not a PC company" idea while discussing the new enterprise tools. And of course, you get some fantastic soundbites: "It's no longer about shiny boxes, it's about IT solutions," said enterprise chief Brad Anderson. "We're not really a PC company anymore. We're an end-to-end IT solutions company," says Michael Dell himself.
But Dell hasn't actually thought of itself as a PC play for many years. Take this blurb from a press release dated way back in 2005:
"Dell is a trusted and diversified information-technology supplier and partner, and sells a comprehensive portfolio of products and services directly to customers worldwide."
You can smell the PC in there, but the bigger ambition was already obvious. And the message really hasn't changed all that much in seven years. In a recent 10Q filing, Dell bills itself this way:
"We are a leading integrated technology solutions provider in the IT industry."
The goal has become more refined with a tighter enterprise focus, but there's no need to act surprised. I like the margin-boosting power of Dell's enterprise success, which is why I recently started a bullish CAPScall on the stock. Mr. Market seems to have missed the writing on the wall.
Dell is latching on to a couple of unstoppable trends in the IT market, because IBM shouldn't get to have all the fun. Don't forget to look for smaller fish in this exploding pond, though. In a special report penned by the Fool's finest analysts, you'll find the only stock you need to profit from the new technology revolution in Big Data and business intelligence. The report is totally free, but it won't be available much longer, so get your copy right away.