Marriage of Dell and Sun: Will they or Wont they?

Filed in archive Business on May 30, 2008

Photo courtesy of iStockphoto, Thomson Chemmanoor

Will they or Wont they? This is what is confusing minds out there who feel whether Dell would buyout Sun or not after HP went ahead to get EDS. Rumors have been afloat that Dell might consider buying out Sun but these are just rumors.

Why this wont take place is because the businesses of both companies are poles apart. Sun Microsystems has been selling expensive servers whereas Dell is into the business of selling low end servers. With companies moving away from expensive servers to inexpensive servers being offered by HP and Dell in case a deal is struck it wont be of much benefit to the latter.

Secondly if you consider the financial status of Sun currently it won't add anything to operating income of Dell.

Thirdly if you compare Sun-Dell case with that of HP and EDS then there can be no comparison as the acquisition of EDS would not only add to the services of HP but would also supplement their revenue by $5.5 billion to $6 billion per quarter.

If you consider these aspects above then chances of marriage between Sun and Dell look pretty bleak.

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Response from: djb95054 (06/06/08 11:34am)

The landscape is not really HP-EDS vs. Dell, it is Dell vs. IBM and HP. In the consumer space, Dell is King (although HP is hot on their tail), in the enterprise space, Dell is an after thought. The beauty of a Dell-Sun merger is that it would put Dell in a much more powerful position against IBM and HP in the enterprise. Add in a services company like Accenture and Dell could be a strong #2 heading for #3 in the higher-margin enterprise space.

Response from: djb95054 (06/06/08 11:36am)

...oops, I meant heading for #1! :)

Response from: Cheap Used Dell Computer (07/12/09 8:53pm)

Regarding the Dell Vostro still being shipped with a fault, it is more than a couple. If you visit their own forum you will get a clearer idea of how big an issue it is.