Technology companies tend to have very fickle relationships. For instance, Microsoft helped launch Apple, worked to kill the company, provided money to save it, and then got its butt kicked by it.
Dell first partnered with EMC, then competed with it, then bought it (the CEOs remained friends throughout).
Dell and HP have had a rather interesting relationship as well. Dell used to resell HP printers, but after HP bought Compaq, the firms went to war. However, with HP now split from HPE, growth now lies in very different areas. There is a potential synergy between Dell and HP, which makes me wonder how long it will take both to realize that they might once again make interesting partners.
I’ll argue that point and then close with my product of the week: a fascinating Sonos offering that bridges whole home audio with Amazon Echo.
Dell Technology’s Strategic Future
I attended a Dell analyst event last week that highlighted the company’s fascinating play to own the future of digital convergence. Every technology expert I follow has concluded that in the future, technology in business — and I mean by 2030, so near term — will rely on highly connected, automated, intelligent systems. They will handle everything from employee provisioning on the fly to running the manufacturing floor, to managing healthcare, to — well, you name the vertical.
By 2030, we’ll be up to our armpits in connected AI-driven automated systems that make decisions automatically about most everything we touch and do, including driving our cars for us.
Dell’s impressive strategy is to pull all the elements of Dell Technologies together with a ton of partners like Intel and Microsoft to make this happen. If it is successful, it will rise to be a power that could exceed Google and Amazon combined, and come far closer to the power that IBM had when mainframes were the only computer system at scale.
This in potentially in line with Microsoft’s effort to own the Internet following Bill Gates’ tidal wave memo. Microsoft went from a vendor of Windows and Office to the most powerful — and scary — company in tech for a while, and pretty much rolled over every competitor it then had.
This is the potential of the Dell strategy, and it likely would be unachievable if Dell weren’t run by its founder Michael Dell; hadn’t merged with EMC, giving it massive scale; hadn’t gone private, allowing it to take the related risk; or didn’t have what arguably is the strongest Internet of Things team on the planet.
This strategy largely would depend on robots, however, which Dell doesn’t make and has no plan to make.
HP’s Strategic Future
I also spoke to HP’s executive staff last week, and their company’s future is equally interesting, even though it is massively different. HP’s future is tied to 3D printing, which is poised to turn its massive print unit from what was viewed as a liability into a massive asset.
This is not printing on paper, but HP is the only firm in its class creating and shipping 3D printers. The greenfield opportunity for industrial 3D printers is both massive and underrepresented by vendors in HP’s class.
HP shortly will offer not only monochrome plastic, but also full color — and it is moving into metals. The goal is to put these printers on manufacturing floors and use them for just-in-time parts. However, it is likely that every home and every business eventually will have 3D printers, and the opportunity could, due to supplies, exceed that of smartphones.
Firms with lines that deploy 3D printers will be more agile, more flexible, and far more able both to customize products being manufactured and shift between product types. If HP continues to execute, it could own much of the future for manufacturing — both commercially and in the home.
However, 3D printers — particularly when deployed in a manufacturing line — are robots. In effect, HP is creating robots that make things, including parts for themselves. These robots are gaining capabilities. In addition to the recent announcements of full color in plastics, and the use of metals, there’s an expectation that blended materials are coming.
Once it starts building one type of robot, building more types increasingly will look interesting to the firm.
Blending the Companies
So, Dell’s strategic future is to blend things like robots into centralized, integrated solutions that automatically are managed by next-generation AI controllers, using a blend of deep learning, machine learning and inference. However, it won’t be making robots, which currently aren’t being made by a vendor of enterprise class.
HP is on a path to build ever-more-capable 3D printers, which basically are complex robots that eventually will need to be integrated into the solutions that Dell Technologies is creating. Once HP starts down the path of building robots, it undoubtedly will move to adjacent robotic opportunities, and they are enterprise class.
Both companies still make PCs and workstations — an area where they will continue to compete — but both companies also partner with Microsoft, which makes one of the fastest-growing lines of PCs in the market, the Surface offerings.
So, both companies successfully have created strategic partnerships with firms that also were competitors. Put differently, while PCs once were very important to both firms, that importance has dropped for both, and their greatest growth opportunities now lie in areas where there is synergy between them — not conflict.
Wrapping Up: Strange Bedfellows
A huge gap in Dell’s strategy is its lack of desire to build what likely will be the most prevalent end components of its strategy in manufacturing: robots. A huge gap in HP’s strategy is its lack of sufficient breadth to build comprehensive AI-driven connected solution critical to achieving its broad goal of placing 3D printers into manufacturing lines.
To get where Dell is, HP would have to recreate the firm that existed before it was spun out of HPE, which seems very unlikely. To fill the robot gap, Dell would have to create a robotics division nearly from scratch. While less difficult, that still would create a huge distraction and push out final solutions for manufacturing, which then would be gated by the robotics building activity.
Oh, and both Dion, HP’s current CEO, and Michael Dell are very well regarded and liked by many in the rank and file of both firms, unlike prior HP executives.
The only question in my mind is how long it will take either of these men to realize they would benefit from the partnership, and then to pick up the phone and make it happen. We’ll see…
If you wanted to distribute high-quality sound through your home easily and cheaply, there really was only one solution: Sonos. I moved to this platform years ago, but I’ve been using my Amazon Echo products more, of late, even though the quality of the sound is distinctly inferior.
Still, I’m choosing them because voice control is considerably easier to use than an app on your phone or PC, particularly if you are cooking, working on a project, or just reading with music in the background.
Well Sonos stepped up and partnered with Amazon and created the new Sonos One with Amazon Alexa.
Priced at US$199, or just above Amazon’s own product, this offering has better sound. Because it integrates with other Sonos products, you easily can move the music you listen to around the house, with full Alexa voice control.
I should point out that this relationship apparently went both ways, because you now can create groups of Echo products and use what was a unique feature in Sonos, party mode, to synchronize the sound all over your house, providing an experience identical to a far more expensive custom wired-in speaker system.
Still, stereo is far harder to do with Echo products, and for integrating things like TV sound and surround sound, Sonos is the only good solution at the moment. Echo products just don’t have that capability yet.
With all the new home assistant products from Amazon, Apple, Google, and Microsoft coming to market, my new favorite is the Sonos One with Alexa, and that’s why it is my product of the week. (Now if I could just get the company to build an outdoor speaker with Alexa.)
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