Dell’s Acquisition of EMC Makes Sense – and Probably Dollars

The largest acquisition in information technology industry history predictably dominated the IT analyst social web in October. The consensus opinion that emerged was that Dell’s bid to buy EMC makes sense, and is a sign of the times both technologically and financially.

Based on IT analysts’ social media posts – 114 blogs and 583 tweets during the month of October – there’s general agreement with the rationale for the Dell-EMC combination.

Dell EMC acq AV graph Oct15 cropped 50pct

 

Dell EMC acq graph legend Oct15

For example, Technology Business Research wrote, “Dell’s planned purchase of EMC makes it like the General Motors of IT… The combined entity will be better able to deliver solutions to large and midsize business customers…. Dell has historic strengths in consumer, small business and the midmarket. EMC’s historic strength lies in large enterprise. The new entity will have permission to play across all segments.”

Analysts generally bought into the synergy-will-produce-growth story that Michael Dell articulated. Techaisle wrote, “The theory appears to be that by combining EMC’s prowess at selling to enterprise accounts and Dell’s broader compute portfolio the company can increase share of wallet within major accounts.”

And on the financial side, as InfoTrends noted, “Going forward, EMC will now be spared public scrutiny of its quarterly results, and can focus on R&D to regain a competitive advantage in the story market.”

Many analysts favorably contrasted the Dell-EMC deal with HP’s purchase of Compaq 15 years ago. The

Pund-IT blog wrote, “Dell’s primary efforts among small- to medium-sized businesses and EMC’s focus on large enterprises means there will be far fewer opportunities for conflict [than HP’s acquisition of Compaq]… and the fact that [Dell and EMC] have worked together closely in the past and share many mutual partners should help to mitigate some [cultural] challenges.”

Insight into this and other topics being addressed throughout the IT analyst social web is available through Northern Light SinglePoint™, Northern Light’s enterprise-class strategic research portal. Contact Northern Light directly for information.