Dell to build services business in emerging markets
June, 11th 2008
Dell Inc, the world's No. 2 personal computer maker, plans to boost its software-services business in emerging markets as companies there step up technology investments, a senior official said on Tuesday.
Texas-based Dell offers services such as deployment and support of information technology infrastructure, customer support services, and technical assistance that helps companies to boost efficiency and reduce costs.
"The emerging markets are really interesting for us. We are seeing terrific innovation on the hardware side and some pretty cool innovation on the services side to complement it," said Stephen Schuckenbrock, senior vice president of global services.
Dell has been more dependent on the U.S. market than rivals Hewlett-Packard and IBM, and a U.S. downturn is adding urgency to the need to diversify into other markets.
Dell would be looking to build its services business in major emerging markets such as Brazil, Russia, India and China, Schuckenbrock, who is also Dell's chief information officer, told reporters during a visit to India's tech hub of Bangalore.
The company, which posted a higher-than-expected profit in the quarter to May 2, said last month sales outside the United States were growing much faster than its home market and could account for two-thirds of total revenue within five years.
Schuckenbrock said the services business, which accounts for about 10 percent of Dell's annual revenue of more than $61 billion, was less likely to be affected by a slowdown in corporate technology spending than demand for computer hardware.
"It's a very good industry for both good and bad times in the economy," he said. "When times are good, people are looking for speed and access to talent, and when times are bad they are looking for cost and quick acceleration of the benefits." In February, Dell said it would buy business e-mail service provider MessageOne Inc in a $155 million cash deal, aiming to compete with similar service provided by Microsoft Corp and Google Inc.