<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[<p>Michael Saul Dell, 46, through his eponymous firm Dell Inc, defined the Personal Computer (PC) industry in 1984, by directly selling to customers from his University of Texas dormitory room, undercutting the middleman and in the process becoming a billionaire several times over. 27-years later, he has the chance to redefine the industry again, as it faces its biggest churn. While his biggest competitor Hewlett Packard (HP) Company has hung a 'for sale' sign on its PC business, signaling its intention to exit a high volume, low margin market, Dell is gung-ho about the prospects of the industry and his company. <br><br>Dell who returned to the CEO role in 2007 to rescue a floundering company, after a brief flirtation with a Chariman's non-operational role, now seems keen on moving his firm away from being a low-cost, box pusher, to a solutions firm, which provides hardware, software, storage and services under one roof. <br><br>In an in-depth chat with Businessworld's <strong>Venkatesh Babu</strong> from Dell's headquarters at Round Rock, Texas, he talked about the challenges facing the PC business in particular and the hardware industry in general, the rise of smartphones and tablets as well as the transformation journey to being a solutions company. Edited Excerpts :<br><br><strong>You were a pioneer in the PC industry. Is the PC industry dying or dead?</strong><br>Reports of death of the PC are greatly exaggerated. This year alone, globally around, 440 million PC's will be sold. Gartner for instance predicts that this year about 40 million tablets will be sold. I have been hearing these reports of the death of the PC at least since the mid 90's and even when the industry was selling a mere 100 million PC's. Some analysts project that by 2014, actually a billion PC's would be sold a year. Look, while nobody denies that the smartphones and tablets as a category have risen significantly in the recent past, fact is that the PC is not going to disappear anywhere. At least not in the near future. <br><br>When a person buys a smartphone, it is not as a substitute to the PC. There is a continuous evolution of multiple form factors. Smartphones and Tablets are good at certain things like content consumption, while the PC would be good for content creation. In India and several other developing markets, I think the PC market is under-penetrated and there is significant room for growth. I think (the current market) can be described as PC plus rather than a Post-PC era. <br><br><strong>What do you make of HP's announcement which essentially means it is looking to sell its PC business?</strong><br>I personally think this is an incredible opportunity for Dell. We have a very good PC business. If HP or somebody else doesn't want to be in the business, it is just more opportunity for us. Customers of that company (HP) are concerned and confused. We have been talking to them and our channel partners. We will do all that is possible to help them to move over to Dell. We are the only player today that provides everything from the client (PC) to server, cloud and services. <br><br><strong>Every since you took charge of the company again in 2007, you have tried to move it away from a very efficient, low-cost, box pusher to a solutions company. How far do you think Dell has traversed along that path?</strong><br>I see this transformation as a kind of a continuum rather than changes (happening) in months and years. The key along the way has been that value has moved from hardware to software and now services. But that doesn't mean that hardware or software are going to go away. <br>Dell has been adapting and leading some of these changes by investing and growing both organically and through acquisitions. In the last 18 months we have acquired 11 or so companies. Just in the last quarter our earnings per share grew by 71 per cent. Our offerings are open, scalable and affordable, and that is a message customers want to hear. I am happy with the progress we have made, though we have lots left to do.<br><br><strong>HP seems to be following the path of IBM in trying to strengthen its services offering and exiting low margin hardware businesses. Is that the path Dell would also eventually follow?</strong><br>Well, I have never been fond of stereotypes like that and won't comment on what others might or might not, be trying to do. What I can tell you about what Dell is doing, is that, unlike others, we are about open and not proprietary standards. We believe in the PC business even as we grow the smartphones and tablets space. I think you will see us approach (this transformation to be a solutions company) a little differently. Other companies might have legacy business built around proprietary standards and might not want to disrupt that. But we have no such issues and we will try and change the market in a way which is great for customers.<br><br><strong>Dell has had limited success in smartphones and tablets, at least till now. How do you plan to address this challenge?</strong><br>In the global $3-trillion IT industry, Dell has been very successful. Also what is worth thinking about is that each time somebody uses or accesses something on a smartphone or a tablet, they get on a network, they access servers and storage. Very high percentage of those (servers and storage) are powered by Dell. So whether it is somebody's else smartphones or tablets or ours, we still benefit. Of course we aspire to do more in the phones and tablets market. In phones we are excited about both Andorid and Windows Phone 7.<br><br>In tablets, till now, only Apple has had success there. But it is very early days yet. We have certain exciting products and software in development, the results of which you will start seeing shortly.<br><br><strong>You have made several acquisitions in the recent past including Equal Logic, Compellant and Force 10, primarily to plug gaps in your portfolio. Perot at $3.9 billion was your largest acquisition. What is the strategy here.</strong><br>First of all if you look at the kind of acquisitions whether it is in, datacenter, storage, security or services, we have made there are a couple of common themes. Over 90 per cent of the engineers being acquired are in software. They fit into the overall theme of us being a solutions company. We have more than $16 billion in cash and depending on opportunities in the marketplace, we will use it appropriately.<br><br><strong>Recently you hired Suresh Vaswani. What is his mandate ?</strong><br>Suresh is a senior resource who wears two hats. One would be to grow our services business and the second as the Dell India, Chairman. India is an extremely important market for us. We have built a very good business in India where we have become No.1 (in the PC market). We are investing in the local market for the long haul. Our resources there are fantastic and key to our global success.<br><br> </p>