The Mind of Dell . . .

A few places have gotten a bit upset about this Dell interview, apparently because Dell isn’t adopting Opterons any time soon, if ever.

Just looking at the headline of the story tells you all you really need to know: “Standards, volume key to what we do.”

What Dell does is pretty simple. When a potential new market emerges, Dell waits until it becomes both popular enough and standardized enough so that they can use their economy-of-scale advantages to overwhelm the opposition.

They aren’t early adopters. Rather, they follow the precept, “It’s the little guys that start the fights, and it’s the big ones who finish them.”

In the case of Opteron, we’re still in the early adopter phase. Among major OEMs, IBM is selling one model, and Fujitsu-Siemens is supposed to get one out one of these days, but they haven’t yet. That’s not much.

Opterons will no doubt do better as time goes on, but as we pointed out a few days ago, in that very interview, the Dell spokesman said when asked about x86-64:

“Intel is there. I’m not saying that they have the technology ready or that I’ve seen it. But for them to put that technology into the marketplace would take a nanosecond.”

So if x86-64 takes off elsewhere, all Dell has to do is wait for Intel to give it to them (maybe nudging them a bit in the process). They can always threaten to go to AMD if necessary.

Yes, Dell sells Itanium2 machines, and Itanium sales have been even more miniscule than Opteron sales, but Itaniums have progressed to the point where they generally do rather better than Opterons, at least in spec CPU2000. The thought of buying an Itanium2 is no longer ludicrous.

BTW, for what it’s worth (probably not a whole lot), if you look at the latest spec2000 scores, while Dell hasn’t yet posted any new scores which beat Opteron/FX scores with 32-bit processors (as claimed in the interview), Intel has with an EE.

It remains to be seen if Itanium2 sales will take off, but even at worst, it makes more sense for Dell to humor Intel on this one than to unnecessarily alienate them by adapting a technology Intel is likely to eventually give them when and if they ever need it.

It’s Their Business

The complaints about Dell ignore one very simple fact of life: Michael Dell was not put on this earth to make AMDroids happy, nor to run an AMDfirmative action program. This is business, not an entitlement program.

He’s chosen to run a business to make himself and his shareholders happy, and much as it may pain some people, Dell has managed to become the most successful PC manufacturer in the world without selling a single AMD processor.

It’s hard to argue with success.

Part of that no doubt is due to Intel offering sweetheart prices to Dell in return for exclusiveness. That may not be fair to an AMD fanboy, but it sure seems fair to the Dell customers and stockholders.

That’s the real reason why Dell sticks in some people’s craw. Dell’s existence and prosperity mocks the claims of AMDroids. If AMD’s products truly were that much better, Dell would be in a lot of trouble with their Intel-only strategy. But they’re not.

The Dell decision is rational enough. That doesn’t mean it will prove to be a correct decision in the long run, but it’s hardly crazy, especially given the possibility that Intel will let them have their cake and eat it too, should x86-64 take off.

Really, what is Dell saying? They’re essentially saying to AMD, “Prove yourself worthy first.”

Dell isn’t exactly the only server OEM out there, and it’s not the only server OEM not running to offer Opterons.

It’s up to AMD and AMD lovers to prove Dell wrong, not the other way around, and the only way to do that is with sales, not sobs.


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