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Dell Turns to Partners as It Pulls Plug on Public Cloud

Dell this week said it is abandoning plans to push forward with Infrastructure as a Service (IaaS) cloud offerings and will deliver cloud hardware and software through partners. The move came on the eve of VMware's announcement that it will launch an IaaS.

The company is discontinuing its VMware-focused cloud IaaS, while putting the breaks on plans to deliver services based on the open source OpenStack platform. Instead, Dell said it will equip and support its partners to build and host such services on various cloud platforms.

Dell's decision to pull out of the public cloud market is not very surprising. Gartner analyst Lydia Leong noted in a blog post that Dell never gained much traction with its VMware-based service, nor did most other providers other than CSC. "The writing was mostly on the wall already," Leong said.

While it was a major contributor to OpenStack, its service based on that platform never quite got off the ground. Dell's acquisition of Enstratius earlier this month was a further signal that the company was going to focus on helping service providers and enterprises manage multiple clouds.

Also, it's not surprising that Dell was reticent to invest in building out multiple public cloud services, given its current plan to go private. Ironically, as VMware goes direct (though it insists it's still committed to offering its software and services through its partners), Dell's cloud strategy now goes deeper on enabling enterprises to manage multiple clouds offered by third-party providers.

"Dell is going to need a partner ecosystem of credible, market-leading IaaS offerings. Enstratius already has those partners -- now they need to become part of the Dell solutions portfolio," Leong noted in a separate blog post. "If Dell really wants to be serious about this market, though, it should start scooping up every other vendor that's becoming significant in the public cloud management space that has complementing offerings (everyone from New Relic to Opscode, etc.), building itself into an ITOM vendor that can comprehensively address cloud management challenges."

Posted by Jeffrey Schwartz on May 23, 2013 at 11:59 AM


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