Dell Could Beat Apple in the Post-PC World

Rob Enderle

We go through cycles where technologies peak and then die off. Some, like radios, never really go away, and others like cassette tapes, simply become part of history. Back in the '80s, the mainframe was eclipsed by the client/server concept whose biggest champion was Sun Microsystems. Who would have guessed that decades later IBM's System Z would be its most profitable product and Sun would be in the company dustbin?


Right now, the market appears to be positioning itself for the post-PC era and both Dell and Apple appear to be the most aggressive at transforming themselves into companies that can ride this next wave. However, while Apple is more vocal, each company is going about it differently and each is utilizing its own unique strengths.


Post-PC Market


One of the initial issues I have with this concept is that it is defined for what it isn't as opposed to what it is. I think we all can see that smartphones, tablets and even MP3 players (think: iPods) are eclipsing PCs on the client side, and the concept of cloud computing is driving the server side. Few appear to be good at both and it would appear that post-PCs will be a blend of cloud and unique client devices. Strangely enough, Google seemed to see this first, but its execution has been marred by an excessive focus on advertising-based offerings and an apparent inability to create high-quality offerings.


Microsoft is massively invested in the cloud, but is having trouble producing a timely universal cloud client outside of the PC.


Both platform-based firms are coming at this market a bit differently and both appear to be crippled by their unique legacies.


Apple and Dell


This brings up hardware vendors, with Apple and Dell appearing to be the most focused out of the PC segment. Apple is strong on the client side and has the most popular smartphone and tablet, but on the cloud side, it is relatively weak (it killed off its server product a few months ago). In terms of profit, it isn't coming from its PCs, but from its alternative devices, which is turning Apple into a true post-PC company.


Dell is on the alternative track. Nearly two-thirds of its revenue come from services, storage, servers and other back-office solutions that are being wrapped into cloud bundles and not from PCs. It just had one of its most profitable quarters, largely because it, too, has positioned itself as a post-PC company.


Could the ultimate winner be Dell?


Dell's Shot


I'm the first to say that there is a big gap between "could" and "will" and suggesting any company might win over Apple might turn you into Mac fan flamebait. But I'm feeling brave (or stupid) today, so here goes.


If the goal is to create an end-to-end solution with a unique client tied to a robust backend that serves it, Dell appears to be further along. Even the possibility of this is uplifting Dell's stock at the moment. Apple exited the server business and while it does have software properties like FileMaker that can be used as connectors, Apple is best when it contains the solution, not when it has to work through others. This is actually true of most vendors as what otherwise happens are problems grow out of the inability for two or more separate companies to stay on the same page with regard to roadmap or execution.


Dell, like Apple, has a strong client business and it is at least dabbling in smartphones and tablets. In contrast, Apple isn't even dabbling in servers anymore and if this new post-PC market becomes a blend of both, then Dell actually has the strategic advantage, but it will still have to execute better than it is on the client side, or like Apple, it will only have part of the solution.


One additional thought is that for the business market, particularly the midmarket, Dell is tightly focused on related solutions, while Apple is just starting to acknowledge that there is a market that could be lucrative. But closer at the start doesn't always mean first to the finish line.


Wrapping up: Could the Post-PC Champion Be Dell Rather Than Apple?


"Could" is the operative word here, and marketing in line with what Louis Gerstner had at IBM is critical to convince the market this is the case, but I think Dell can do it. On paper, I think Dell has a better mix of technologies, particularly after recent key acquisitions like Kace, which can address the iPad's business shortcomings that will be needed to complete this solution, but Apple is massively dominant in the new, key client technologies that are currently trending. The key could actually be that the market has yet locked down on the ideal client device.


Even Apple isn't calling the future the "tablet and/or smartphone" future, but the "post-PC" future. That suggests that the client isn't yet, even in Apple's mind, locked down yet, but on the cloud side where Dell exists, there appears to be no doubt in Microsoft, Google, EMC, IBM, or Dell's mind where that is going. If Dell can lock down an alternative to the iPad before Apple can figure out the cloud, Dell could become the firm that defines this post-PC world.


One More Thing


One final thought: Apple's key mistake may be a repeat of what it did when it had the huge campaign against Vista instead of calling out Windows or Microsoft. When Microsoft changed the name to Windows 7, it effectively side-stepped all of Apple's work. By not better-defining what the post-PC era is, Apple is allowing companies like Dell step in and ride the wave it is creating.

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Add Comment      Leave a comment on this blog post
Mar 4, 2011 3:06 PM a. asdf a. asdf  says:

A little off topic post,

____"Microsoft Corp., the world's largest software maker, won't release a competitor to Apple Inc. and Google Inc.'s tablet operating systems until the 2012 back-to- school season, people with knowledge of the plans said."


I just want to mention that I predicted this in a post to your October 2010 article. This analyst stuff is easy, LOL.


____"So basically, it took Microsoft 3 years to come up with a first generation iPhone competitor. I can't wait for the Windows iPad competitor to be released in 2013."

Mar 4, 2011 3:16 PM Rob Enderle Rob Enderle  says: in response to a. asdf

Fast they aren't.   I really think they should be working harder to slow the iPad.   But yes you kind of called it. 


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