Dell To Sell Solaris Servers - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Software // Enterprise Applications

Dell To Sell Solaris Servers

The agreement aims at Dell's efforts to meet server customer demand and Sun's goal to sell more Solaris services and support.

Dell and Sun Microsystems, rivals in the computer hardware market, unveiled on Wednesday a co-opetition agreement in which Dell would sell servers preinstalled with Sun's latest Solaris operating system and then funnel customers to Sun for support and services.

The multi-year distribution agreement launched at the Oracle OpenWorld conference in San Francisco is the latest example of how the computer industry is being driven by corporate demand for openness among technology vendors. Dell agreed to sell PowerEdge servers pre-installed with Solaris 10 after seeing an increasing customer demand for the OS on its servers. For Sun, the deal gets Solaris in Dell's high-volume sales channel, which could become a significant source of revenue.

Under the agreement, Dell would keep all revenue from server sales and resell Sun services and support packages. Revenue from the latter would be shared between the parties. Dell customers, of course, could go directly to Sun to buy multiyear support subscriptions, which include patches and upgrades.

At first glance the deal may seem odd, since Dell gets the hardware sale, while Sun only gets revenue from the support contract. But the latter company sees a chance to start a dialogue with the millions of Dell customers downloading Solaris, Richard Green, a VP and general manager in Sun's software business, told InformationWeek.

To date, 12 million Dell customers have downloaded either Solaris or OpenSolaris, the open source version of the OS, according to Green. Most of the downloads have been for Solaris. About 70% of Solaris installations are on Dell, Hewlett-Packard, and IBM servers. Sun has a partnership with IBM, but not one with HP, the biggest seller of x86 servers, which is what Dell will sell.

Without the latest partnership, it's unlikely Dell customers would contact Sun. In addition, spreading Solaris further in the market through Dell could lead more developers to build applications for the platform. Because the OS is developed by Sun, companies interested in buying Solaris servers in the future could choose to contact Sun.

Also, the deal does not prevent Sun from trying to sell its hardware to Dell customers. "There's nothing preventing Sun from pursuing opportunities with those accounts as well," Green said.

John Spooner, analyst for Technology Business Research, agreed that the partnership has the potential of benefiting both parties. For Dell it fits into its strategy of pleasing the customer. "If the customer wants Solaris, then Dell is saying we'll give you what you want," he said.

For Sun, it's a potential increase in high-margin software sales, something the company could use more of, given the disappointing revenue numbers in its recent earnings report. "This is all about generating more revenue around Solaris," Spooner said. "Software services are very close in profitability to Sun's high-end hardware."

Another advantage for Sun is the ability to know who wants their software. If companies download Solaris over the Internet, Sun may or may not learn who they are through the registration process. "Sun knows the person who buys from Dell and IBM, so their ability to market to them goes up dramatically," Spooner said.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
News
Top 10 Data and Analytics Trends for 2021
Jessica Davis, Senior Editor, Enterprise Apps,  11/13/2020
Commentary
Where Cloud Spending Might Grow in 2021 and Post-Pandemic
Joao-Pierre S. Ruth, Senior Writer,  11/19/2020
Slideshows
The Ever-Expanding List of C-Level Technology Positions
Cynthia Harvey, Freelance Journalist, InformationWeek,  11/10/2020
White Papers
Register for InformationWeek Newsletters
Video
Current Issue
Why Chatbots Are So Popular Right Now
In this IT Trend Report, you will learn more about why chatbots are gaining traction within businesses, particularly while a pandemic is impacting the world.
Slideshows
Flash Poll