Is Dell Privatization a Death Rattle To the PC?

Early this past week we learned that computing monolith Dell was tossing around the idea of privatization with technology based private equity firm Silver Lake.  On Wednesday, February 5th, owner Michael Dell signed off on one of the biggest buyouts the tech industry has seen since the financial crisis. With backing from longtime software partner Microsoft, in the amount of $2 billion, this new move leads to some serious questions as to the future of the PC world and Dell’s IT management products.   

There a handful of scenarios that can be expected, especially with a 45-day open bidding period catering to other potential investors.  Though more than likely with the combined support from Microsoft and Silver Lake, not many, if any other firms or investors will step in to break up the long standing Texas-based computer company.  If that is the case, as a big supporter and Dell’s most valued OEM software provider, how much influence is Microsoft expected to have over the reinvention of Dell?
 
Historically, Dell has always had a link to Microsoft; some believe that this new move will make that connection even stronger in a potentially declining PC market.  However, there are also competing lines of thought stating that even with this generous financial support, Microsoft might not be as big of a player in Dell’s future as some are predicting.  We have seen this story played out before with, not so smashing results (Microsoft/Nokia).  

In a statement by owner Michael Dell announcing the move, he emphasized their continued commitment to a “long-term” plan. With this tremendous turn it is hard to say exactly where that plan will land businesses that have been relying on Dell solutions for years in the near future.  Dell pioneered many of the low-cost enterprise IT solutions that have helped so many businesses take off.  Aside from manufacturing computers, Dell has helped thousands of businesses flourish and build strong foundations by providing innovative and affordable data storage solutions and IT management hardware.  Could the production of IT hardware suffer now in favor of a more mobile-centric software strategy?
 
It is no secret that mobile devices, handhelds and tablets are making serious headway into all aspects of our lives – personal and business.  In the face of heavy competition from Android and other mobile-centered markets, Dell has begun what looks like the beginnings of a new path.  One apparent drawback to this partnership is the alienation of other computer manufacturers and its added stress on Dell’s relationship with certain software vendors and open source providers.  The bigger story here – privatization and strengthened bonds with a mobile-focused brand possibly leading to a major change in production for the third largest computer manufacturer in the world.

It should be a good show seeing how all this plays out – something every business owner using Dell products for a complete IT management solution  should watch closely.  Not that a change in direction will defunct current infrastructure, but a good time to take stock and see where you stand and possibly explore other options.