Dell to launch service program aimed at corporate tech market

Monday, August 28th 2000, 12:00 am
By: News On 6

Dell Computer Corp. is expected to announce Monday a new program of services aimed at the corporate information technology market.

Called Dell Image Management Services, the program is aimed at beleaguered corporate information technology departments, which are often understaffed and overworked as the Internet economy rapidly pushes ahead.

"Michael [Dell] said in 1996 that it's important to get beyond pushing boxes," Frank Miller, vice president of Dell's custom factory integration unit, said in reference to personal computers.

Dell, like other computer-equipment makers, is making a push into the more profitable services business as companies move beyond desktop computers toward mobile devices and Internet-based commerce.

Dell says it is uniquely positioned for the market because it pioneered the direct model of selling goods and services online.

The company claims it answers 70 percent of "incidents" – questions posed or problems reported by customers – online compared with an industry average of 34 percent.

Information technology departments – the in-house technology fix-it crews – "are never going to go away." he said. But he said many are so short staffed that they hire outside systems integrators – technicians who make computers talk to each other – as surrogate staffers.

Wall Street analysts say Dell has little choice but to capitalize on its experience conducting business over the Internet.

Ashok Kumar, who follows the Round Rock, Texas, company for U.S. Bancorp said in recent research comments that Dell's revenue would "come under increasing pressure until the company develops a meaningful storage and services strategy."

Dell's play in the data-storage market has been troubled by a delay in the launch of a new product by one of its recent acquisitions.

But analysts at the Gartner Group, a market research firm, say Dell is the fastest-growing hardware-services company in the world. In 1999, according to Gartner, Dell hardware services grew 63 percent, for revenue of $2.2 billion.

The "image" in Dell's services program isn't about marketing. An image includes the operating system, drivers and software applications stored on a hard drive.

Image Management Services will sell such products as notebooks, servers, workstations and storage and integrate them with a set of instructions prepared in advance.

Dell said it has successfully put 10 pilot customers through a test of its service but would not identify the companies.