Lessons: Google sells Motorola handset unit

I was indeed surprised to read this bit of news today. You may remember that a few years back, HP bought Palm, a maker of Personal Digital Assistants, and was in a similar quandary.  And there are other examples (write to me if you know one). But all this  teaches cash-rich companies  a couple of things.

1. Companies should do due diligence before acquiring — what’s the use of spending million /billions of dollars to acquire a company, because you perceive that it will give you an edge over the competition? What are you going to do with the IP acquired and how will you integrate it into your products lines?

2. Have a well thought out strategy first. Don’t be distracted by the valuation or hot technology  or IP of a company.

3. Look at ALL the assets of the company that you want to acquire. Which assets will you actually  use, and which ones will you dump.

4. Look at the Culture of the organization. How similar or dissimilar is it from yours?

5. What about the liabilities of the organization you are about to acquire? Have you factored that in the valuation?

6. How many patents does the organization have and how valuable are these to you?

If you do know any other  reasons why acquisitions fail, do write in and share these with me and my followers.

 

 

 

Indian entrepreneurs enthusiastic, yet cautious about Bitcoin

Interest in Digital Currencies like Bitcoin has been increasing. But the chances of its proliferation in trade remains a question, particularly in India, which has a highly regulated banking environment. Here’s why Bitcoin cannot be ignored.

In the early years of e-commerce, Indian consumers were wary of using their credit cards for online transactions. But with tighter regulations and security controls, consumer confidence improved, and online card transactions have increased. It was the same for Internet banking. Are we about to see history repeating itself with digital currencies such as Bitcoin?

bit-1It is estimated that there are 30,000 Bitcoins in India, with some 50 commercial establishments accepting payment in Bitcoins. These include shops, restaurants, bars, salons and other establishments. But it seems to be a stopgap arrangement, overshadowed by the fact that the Indian authorities could suddenly pull the shutters on digital currencies. In fact Bitcoin operators and exchanges had to suspend operations recently (See ‘Bitcoin in India’). Yet we observe that Bitcoin payment for online services such as Web Hosting is picking up. Globally, the number of transactions in Bitcoin per day has increased from 35,000 transactions in September 2012 to 55,000 per day in September 2013.

While Bitcoin is gradually gaining acceptance, it poses many questions: like the legitimacy of Bitcoin in the real world, as a currency for commercial transactions; about its potential for online transactions and for e-commerce; and about the risks and dangers posed due to misuse in the deep, dark Web of drug trade, money laundering, counterfeit documents, and other shady activities.

Bit-2And Bitcoin isn’t the only digital currency — it is estimated that there are about 50 such currencies worldwide, with unimaginative names like Litecoin, Ripple, Particlecoin, Peercoin, Namecoin, Lifecoin etc. In fact, we stumbled upon a desi version called LaxmiCoin, which is about to launch its mining operations (Laxmi is regarded as the Goddess of Wealth).

Bitcoin in India

In India, Bitcoin is in a state of anarchy, with no clear standing on whether Bitcoins (or other digital currencies) are legal or illegal. The Reserve Bank of India (RBI) recently issued a cautionary notice warning consumers about the potential financial, operational, legal, customer protection and security related risks of buying and trading in digital currencies. The Times of India reported that the Enforcement Directorate and Income Tax department took action against Bitcoin operators, causing others to suspend or close operations. Some operators have resumed operations, in the hope that lobbying by organized groups will legitimize trading in Bitcoin.

But Bitcoin cannot be ignored. Ever since its launch in 2009, its value soared to unprecedented levels. As of Jan 15, 2014 you’d need Rs 59,321 (1 US dollar = Rs 62) to buy a single Bitcoin. That value wildly fluctuates making Bitcoin a highly volatile currency and a risky proposition for investors. Online exchanges that accept real-world currency in exchange for Bitcoins, and Bitcoin operators that facilitate trading, are mushrooming on the Internet.

Since Bitcoin and other digital currencies bypass the central bank, it raises questions about how VAT and fees will be imposed during transactions, or how it will comply with the FEMA (Foreign Exchange Management Act) or other Acts and laws relating to Import-Export trade across borders.

While we wait for all these issues to be sorted out, there are many entrepreneurs in India who remain optimistic; investors are buying Bitcoin, perhaps like a hedge, hoping to cash in when the value soars further.

Bitcoins Alliance of  India

Meanwhile, a community of entrepreneurs in Bengaluru that call themselves the Bitcoins Alliance of India (BAI), had meet-ups to organize themselves, and to decide how they want to lobby for the acceptance and use of Bitcoin in the country. They want the government to recognize and legalize trading in Bitcoin.  BAI appointed the services of Nishith Desai Associates, a team of international Legal and Tax Counsellors, to look into the legality of Bitcoins in India.

In a note on the BAI website, this firm says: “Our Bitcoins Practice Group examined the issue from techno-legal perspective and have found that Bitcoins per se are not illegal in India. This is in consonance with international approach. US considers Bitcoins as a legitimate payment alternative. US Senate Home Land Security and Government Affairs Committee and the Senate Banking Committee consider that virtual currency has legitimate uses.”

I spoke to some Bitcoin enthusiasts for this story.

“There are about 50 establishments that are accepting Bitcoins in India. But Bitcoins should be seen as a long-term investment as they have high volatility,” said Sathvik Vishwanath, founder of CoinMonk, and a founding member of Bitcoins Alliance of India.

Advocate Nishith Desai recently told a group at a BAI meeting that “ordinary people” should not be trading in Bitcoin because of its high volatility and risky nature.

Vishwanath and a group of like-minded entrepreneurs want to be recognized, and to make it easier for people or establishments to accept Bitcoins in India.

Amit Nirgunarthy, an entrepreneur and Bitcoin enthusiast who is also one of the founding members of BAI said, “Indian entrepreneurs are more cautious about investing in Bitcoins, fearing that the RBI may suddenly declare them illegal.”

However, he was all praises for the technology behind Bitcoin saying it could potentially be used for trading stocks across borders. And because it has digital signatures, it can also be used for filing documents in courts. Nirgunarthy feels it is much easier to do transactions with Bitcoins than using Paypal.

A note on the BAI website highlights the advantages of Bitcoin as:

  1. It facilitates “financial inclusion” to the poor and unbanked population
  2.  Significantly reduces transaction costs
  3. Enables the growth, ease and security of both ecommerce and physical transactions

“India should encourage the mining industry [trade in digital currencies] because that will lead to the widespread trading in Bitcoins. Indian entrepreneurs will be able to export their goods in exchange for Bitcoins, that could later be exchanged for dollars. But we will need a legal framework in place for this,” said Nirgunarthy.

The Gadgets that will light up 2014

Contributed by: Arthur Goldstuck

The buzz around wearable device at this year’s CES in Las Vegas almost overshadowed a flood of groundbreaking new gadgets, but not quite. ARTHUR GOLDSTUCK looks at the newly launched devices that are likely to make an impact in 2014.

It’s fairly easy to tell which new gadgets launched at last week’s International Consumer Electronics Show (CES) in Las Vegas will make a big impact in 2014. They are the ones that managed to rise above the tsunami of attention paid to wearable devices. No, you didn’t have to be part of the “wrist revolution” to get recognition at CES.

These are some of the devices that stood out above the crowd, and earned the applause of the media and show-goers alike:

Parrot Minidrone

ParrotMinidroneThe A.R. Drone quadricopter was one of the great new toys of the past five years, but also established itself as both a creepy and a liberating surveillance device. Now Parrot have launched the Minidrone, a scaled-down version  piloted via Bluetooth Low Energy, and compatible with Android, Windows and iOS smartphones or tablets.

It also comes with four blades, but weighs only 50g and almost fits in the palm of the hand. That means there’s no room for an HD camera and video recording, but a downwards-facing high speed camera helps keep control – and will no doubt also be put to surveillance use. Detachable wheels allow it to drive around on the ground or climb walls. It will be cheaper than the Drone 2.0, but don’t expect much in the way of battery life.

Garmin nüvi 2798LMT 

Garmin_nuuviThe new nüvi, with 7” display, offers a feature that was previously only available on high-end luxury vehicles: a backup camera. That doesn’t mean it backs up your data, but rather gives you a rear view of what is behind your car when you are reversing. It’s wireless, meaning that you don’t need much extra wiring to make your VW think it’s a Volvo.

When wired to the reverse lights for power, the live camera feed displays every time the vehicle is shifted into reverse. A button press toggles between camera and navigation modes if the camera is plugged into constant power.

LG 77” Curved OLED TV

LGOLEDTVLG Electronics won this year’s TV wars at CES. It was no doubt their turn, given last year’s dominance by Sony, and the previous year by Samsung. But what a way to take the lead: A Flexible OLED TV is not only a curved TV unit – Samsung also unveiled one with UHD display – but it also lets viewers adjust the angle of curvature with their remote controls.

For once, it wasn’t hype when the CEO said: “LG’s Flexible OLED TV is a product that has to be seen to be believed, because it defies description.”  HH Ha, President and CEO of LG’s Home Entertainment Company, summed it up neatly when he added: “What curved is to flat, flexible is to curved.”

Samsung Galaxy NotePro 12

GalaxyNotePRO12-2Samsung wasn’t out of the picture. It crushed all comers in the tablet arena, with the launch of a new range of galaxy Tab and Note devices, and taking the maximum standard tablet screen size from 10.1” to 12.2”. The stand-out device is the  Galaxy NotePro 12.2, which swept the boards when it came to awards for tablets launched at CES. Along with the TabPRO, it claims the world’s first 12.2” WQXGA Widescreen (16:10) display, with 2560×1600 resolution. Translation: pretty sharp.

Its magazine-style user interface is  optimised for a large screen, allowing users to organise content in a dashboard with automatic feed or news updates. A Multi Window feature lets users split the screen into four different windows. The Samsung S Pen is included, while a Pen Window allows users to draw a window of any size on the screen, and instantly access in-application features within the window.

ZTE Projector Hotspot

zte-projector-hotspotIt claims to be the world’s first all-in-one Wi-Fi hotspot and portable projector, making it ideal for home or boardroom. It’s a compact 4.7 x 4.7 x 1.1” device, with a 4” capacitive touchscreen, running on Android. The combination of the operating system and Wi-Fi means content can be run directly off the Intetnet, or shared from the device to other devices in the room – up to eight can be connected. Oh yes, it projects images too, up to 120” in size.

It supports multiple inputs, including linking to a laptop through HDMI, or mirroring a smartphone screen via Wi-Fi Display. A 5000mAh battery means smartphones can also tap into it as a portable charger.

MakerBot Replicator Mini

makerbot-replicator-mini-2-xlWhile 3D printing was all the rage at CES, most of these devices for “printing” solid objects are out of reach of the ordinary consumer. Market-leader MakerBot is slowly getting there, though. Alongside the new high-end $6500 Replicator Z18 and mid-range $2900 Replicator prosumer, it also launched an “entry-level” $1375 Replicator Mini. Remarkably easy to use, it is intended to produce both toys and prototypes or complex models of objects that will be mass produced more conventionally.

Using a Smart Extruder nozzle, it converts  filament stored in cartridges in the device to produce solid objects up to 4x4x6” in volume. Astonishingly, there is only one button on the device: it’s primarily controlled via  desktop or mobile app. Now you can build the future tourself.

Sony HDR-CX900 Handycam

SonyProfessional performance in a compact body. It’s a phrase we hear often in video camera marketing, but this time it seems on the money. A 14.2 effective megapixel back-illuminated CMOS sensor with a wide angle 29mm ZEISS Vario Sonnar T Lens allows shooting in full HD with high quality still images. Its 12x Optical Zoom Lens “marries a wide aperture with a seven-bladed iris diaphragm to allow professional-looking videos and photos with smooth, defocused backgrounds”, says Sony. Built-in ND filters, it is claimed, take the camera from low-light to bright sunshine with little difficulty.

Razer Nabu smartband

razer_nabu2-610x343Okay, okay, wearables really will make a splash this year, so let’s end with one. The best one. Entertainment device manufacturer Razer won Engadget’s People’s Choice award in a public vote, with the Nabu smartband. Newcomers to wearables, Razer ignored the rules and built on an open platform that links to smartphones, collects physical data and communicates with other users’ bands.

It does what is now the usual, like tracking fitness data, location, sleep data, and biometrics. Band-to-band active and passive communication makes it a 4Square for the wrist, allowing users to find nearby friends. In future, it may even link you to healthy restaurants – and let you share the experience. That’s both the good news and the bad news. Can you say “oversharing”?

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Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter on @art2gee

New camera formats debut at CEIF 2014 (Photofair)

Point-and-shoot replaced by action cams and lens cams; SLRs and lenses become affordable

The Consumer Electronics Imaging Fair 2014, in Mumbai

Good footfall at the fair, but teeming crowds made it difficult to walk around the photo fair.

The Consumer Electronic Imaging Fair (formerly called Photofair) is an annual event, conducted alternatively in Mumbai and New Delhi. Organized by the All India Photographic Trade and Industry Association (AIPTIA), the event was held in Mumbai between 9 – 12 January, 2014 at the Bombay Convention and Exhibition Center, Goregaon. The fair is patronized by thousands of photography enthusiasts, solutions providers, amateur & professional photographers from all over India.

This year the absence of camera giants Canon and Nikon was profound, though Sony, HP, JVC, Pentax, Ricoh, Panasonic and others made up for the loss.

CEIF also confirmed the death of the point-and-shoot camera, since camera technology in smart phones has now caught up. But new formats like action cameras and smartphone attachable lens-style cameras made an entry.

IMG_0501

The camera in a lens. Use your smart phone screen as the viewfinder.

We visited the Sony stall and got a demo of the new lens-style cameras — DSC-QX100 (for professionals) and DSC-QX-10 (amateurs). At first glance we could tell that this is an entire camera fitted in a lens, minus the viewfinder. Your smartphone screen is the viewfinder. The lens camera relays images to your smartphone over Wi-Fi. The lens camera straps on to the back of your cell phone, but does not make use of your phone lens or phone flash. We’ll come to the specs in a moment.

We asked the Sony official about its application. Apparently, the lens can go into nooks and crevices that are beyond reach for a typical camera. For instance, if you want to capture a shot of a fox in its hole, or a kitten that hides in the hole of a wall, you’d take the lens in your hand and place it closer to the subject. The Sony representative explained that it could also be used for wildlife photography, where you can’t get closer to the animal, to take a shot. But you can place the lens near the spot and move away, monitoring the shot on your phone and remotely controlling the lens through an app on the phone.

Image credit: Sony Corp.

Image credit: Sony Corp.

Getting down to specs. The DSC-QX-100, priced at Rs 24,990 is a 20.9 megapixel camera with a CMOS image sensor and a SLR style control ring. It has a F1.8 Carl Zeiss Vario Sonnar T* lens with 3.6x optical zoom. The other highlight is the BIONZ image processing engine which converts the raw image data from a CCD or CMOS image sensor into the format that is stored on the memory card. So a copy of the image, smaller in size, is made on the memory card — and you can upload it to a website or share it via email. The original image is left on the lens camera. According to Sony, BIONZ imaging engine transforms data captured by the CMOS sensor into “stunningly beautiful” images with accurate colour, rich tonal gradations and minimal noise. For connectivity, it offers both NFC and Wi-Fi.

The DSC-QX-10, which  costs Rs 12,990 is an 18.9 megapixel camera. It has a Sony G lens that offers 10x optical zoom. Like its elder sibling the QX-100, it has BIONZ image processing, NFC and Wi-Fi. Both cameras come with a smartphone bracket or attachment.

With a lens style camera, you can get beautiful images without lugging around a bulky SLR and a bag full of lenses.

Action Cameras

Action cam

Note the camera mount on the handle bar.

Sony, Panasonic and others make HD video cameras that are used by sports enthusiasts and athletes. They come with water-proof enclosures or special brackets for mounting on cycles, headgear and other sports equipment.

SLRs become affordable

But SLR cameras, which were once the staple of professionals and affluent photography enthusiasts, have now become affordable, sinking below the Rs 50,000 price point. We see more photography enthusiasts and hobbyists upgrading to the SLR platform, as prices for entry-level SLRs and lenses continue to fall.

sony Alpha

The Sony Alpha comes with a kit lens, telephoto lens, plus accessories — all for $800.

Manufacturers like Canon and Sony are wooing amateur photographers with sub-Rs 50,000 packages, that include the camera body, kit lens and also a telephoto lens. For instance, at CEIF, Sony was offering a package for Rs 43,990 that included the Alpha SLT-A58K body + standard kit lens (18 – 55 mm) + telephoto lens (55 – 200 mm). During the Christmas season Canon was also offering similarly priced packages for its EOS 600D and EOS 1100D cameras.

Teeming Crowds

With swarming and unruly crowds at the fair, jostling and pushing, or squatting in the aisles, it was at times difficult to walk in the aisles, and spend enough time at the stalls. By day two 27,000 people had visited the fair, and crowd control was a serious problem — something the organizer might want to look into for the next edition. But overall, the fair was well organized, with an entire hall set up just for registration (no separate media registration though), and another for the fashion show, with the expo held in a separate hall. CEIF 2015 will be conducted in New Delhi between 8-11 Jan.

Tesla CEO Elon Musk confident about return of electric cars

Drives Model S into Dell World. Says production can’t keep up with demand due to constraints in battery supply; produces 600 cars a week as sales graph soars

elon-musk-model-s-entrance-dell-world-2013-300x165Apart from Michael Dell, the star speaker at Dell World, Austin, Texas (Dec 11 – 13, 2013) was the Elon Musk, who is CEO of two companies (Tesla Motors and SpaceX) and chairman of SolarCity. But what really got everybody’s attention was an electric car, specifically, the Model S, from Tesla Motors. Musk, who is a visionary and also Fortune magazine’s Business Person of the Year, 2013, rode in a red Model S along a widened aisle in the conference hall, that dropped him at the foot of the stage — with the Beatles song Baby you can drive my car playing in the background. The audience and press went wild with excitement. So electric cars, with sleek sporty designs are cool again, but the moot question is: Are electric cars back for good?  Musk is more than convinced; his company produces 600 of them a week, and can’t keep up with demand.

Car-full-1Later, as we toured the solutions expo floor at Dell World, we got to ogle an electric blue Model S, docked to its charging station. We’ll discuss the unique features of this car in a moment.

Back to Dell World: As Musk walks up on stage, he is warmly welcomed by Michael Dell, the Founder  and CEO of Dell Inc. There’s another surprise passenger who hitched a ride: David Kirk Patrick, Founder, host, and CEO of Techonomy. Kirkpatrick is a journalist, technology commentator and author, and he’s here to conduct a live interview on stage. You can watch the video of what we just described (and the interview) here:

When asked what made him pursue electric cars and start Tesla Motors, Musk chooses his words carefully and replies, “There was a need for acceleration of electric vehicles. It became clear to me that, if it was simply left to the big car companies, we wouldn’t see compelling electric cars, not for a long time. It would be some time before we would see sustainable transport. That became very clear in the movie, Who killed the electric car?

The 2006 documentary film shows how GM created, produced and then killed the EV1 electric car in the mid-1990s. The film portrays the challenges posed to, and the eventual dismissal of the EV1 project by the Government of California, consumers, and component manufacturers.

And the film motivated Musk to pursue manufacturing of electric cars, seven years ago. The original car was called Tesla Roadster. Since then the car has been through several iterative changes and the project experienced multiple problems. But Musk and his team weren’t ready to throw in the towel, yet.

“I have been a proponent of electric cars ever since my college days, when I studied Physics. It seemed obvious that electric cars were the future. I feel that (eventually) all vehicles, with the exception of rockets, will go electric,” said Musk.

Musk also alluded to the impact of carbon on the earth’s atmosphere and said it would take a while for the world to accept that, and then transition to electric vehicles. “That’s why it is important to start early,” he said.

When the Model S was launched in the market last year, the response was overwhelming. Sales were up more than 12 times in the first three quarters of 2013. In fact Tesla could not keep up with demand – not because it lacked manufacturing capacity – but because Panasonic, its main battery supplier could not produce batteries fast enough.

Musk said Tesla currently produces 600 cars a week, though initial projections were about 400 a week. He remains optimistic that the cell supply constraints will be solved by the middle of 2014, or in the second quarter.

The Tesla Motors manufacturing facility in Fremont, California has capacity to build 500,000 cars annually.

“In order to make electric cars sell again we had to work super hard to make them as compelling as possible. That’s the reason why the car (Model S) ended up being a great car. And we have a really dedicated team,” said Musk.

Apart from cell shortages, the project has also suffered due to problems like battery fires. But the breakthrough was Lithium-ion battery technology (which incidentally, also led to slimmer and lighter cell phones).

Front-bonnet-4

Look Ma, no engine!

Rear-boot-1FEATURES

Let’s take a quick look at some of the features that make reviewers say “Wow!” when they test-drive this car. The first thing you’ll notice is that there’s no engine under the front hood or in the rear boot (see photos). That means you can carry a lot of baggage in this car. The powertrain is fitted snugly between the rear wheels. And there is a lightweight front and rear suspension, and smart air suspension. The car’s chassis is all aluminium and has a remarkably low centre of gravity, important for reducing drag. The array of batteries is fitted under the cabin floor. And when you step on the accelerator you will be flung back into your seat, as you are propelled from 0 – 60 in 5.4 seconds!

Dash-3Another striking feature is a large LCD screen that’s integrated with the dash, and positioned between the two front-seats. From this touch screen you can

access the digital instruments, steering wheel controls, entertainment, navigation/maps, Web, communications, cabin controls and vehicle data.

A charging cable is included, that plugs into a US-standard 240 volt wall outlet. Model S owners say that it charges quickly like a cell phone. The manufacturer recommends  that it is charged overnight.

charge

Elon Musk personally supervised the design and manufacture of the prototype. With an eye for detail, he insisted on the highest standards and unprecedented features that posed engineering challenges. For instance, the door handles on the car automatically extend when the driver approaches, and retract once the car begins to move. This feature goes a long way in making the car more aerodynamic to the airflow around it.

CHALLENGES

A couple of issues need to be sorted out for electric cars to really hit the high road again. Apart from a good supply of batteries, there will be pressing demand for more charging stations. So all the gas stations will need to upgrade. And battery technology (which hasn’t kept up with the rapid advancements of other technologies), needs to improve and become cheaper. Apart from these technical issues, there will need to be greater awareness and buy-in for sustainable and clean energy.  Governments will need to do their bit here. Electric cars, now prohibitively expensive, must become more affordable.

Notwithstanding these challenges, if we do see more electric cars on our roads this year, someone might as well make a sequel to the film and call it, Who revived the electric car?

CES: What Intel wants to be….

As the first reports of the International Consumer Electronics (CES) show trickle in, the one that caught my attention was the report on Intel Corporation CEO Brian Krzanich’s pre-show keynote http://www.intel.in/content/www/in/en/events/intel-ces-keynote.html.

IntelI have seen people wearing T-shirts and caps with the Intel Inside logo, and ironically, that may literally become true in a few years! Yes, we’ll probably have Intel powering pacemakers, personal wearable health monitors, or just an Intel chip embedded under our skin.

So  Krzanich wants to change Intel (and its image) — from being a chip maker for PCs and servers to a technology innovator like Apple, HP  or Xerox. The Intel lab technicians in their bunny suits (Intel Bunnyman)  are obsolete — here come the technocrats and their cool gadgets!

But I think what Intel is really getting to is the democratization of technology. Technology is for everybody and should integrate seamlessly into our lifestyle.

Old tech giants have been slow to adapt to the new technology like cloud, social, mobile and big data. And Intel completed its transition to the cloud, internally only in 2012-13.

The world of technology is changing — PCs are fading out and mobiles are in. What you could do on a PC is now possible on a handset. Multi-core processors, HD graphics and PC-like games are now available on mobile platforms.

Qualcomm stole a march on Intel on the mobility platform.

Intel should learn from its mistakes and move quickly to catch the next wave of opportunity — which is wearable computing devices.

Dell reboots to ‘start-up’ mode

Announces new tech innovations and four customer imperatives to surge ahead into the enterprise IT solutions market

What would Dell as a company be like after going private? How much would change? What would be its go-to-market strategy for 2014? How would Dell absorb and integrate all the companies and technologies it had acquired, into its product mix? What are the hot profit segments that Dell will pursue in 2014 and beyond? Will it continue to make and sell PCs in a shrinking market? These were questions on everyone’s mind at Dell World 2013 (December 11- 13) in Austin Texas.

IMG_0425Listening to the highly charged keynote speeches, meeting with Dell leadership and technologists, listening to customer panels, and walking around the glitzy solutions expo floor, it became obvious that, as a private company, Dell is raring to go — and wants to put the fun element back in work. It has a longer-term strategy, new technology innovations like Dell PowerEdge VRTX, Fluid Cache for SAN, 12th generation PowerEdge servers, and Dell Mobile Workspace (more on these later), aggressive pricing, and more delight for customers and channel partners. It’s more committed to entrepreneurship and innovation, and open to industry partnerships.

IMG_0422At Dell World on December 12, a visibly relieved and ecstatic Michael Dell (Founder & CEO) said, “It feels like I am a part of the world’s largest start-up company. As a private company, we have the freedom to make the bold moves that are necessary, investing in emerging markets, in PCs, tablets, software, solutions, and in data centres.”

You can watch the keynote video on demand here: http://dellworld.com/liveonline

Michael Dell

Michael Dell

Dell World is an annual event that’s attended by Dell customers, ecosystem partners, media professionals, technologists and analysts, who get to see and experience Dell’s solutions, and hear about its plans for the coming year. Last year, Dell World had a footfall of 3,000 people; a similar number was expected this year. Dell World 2013 was held at the sprawling, multi-level Austin Convention Center, spanning over 881,400 square feet, or six blocks long.

IMG_0390Dell may be running neck-to-neck with giants like HP, IBM, and Lenovo, but at heart, it was always a company driven by innovation and entrepreneurship – something it can readily get back to, post-privatization. Those tracking Dell’s origins will recall how Michael Dell started the company in his dorm room in 1984, with seed capital of $1,000 at the age of 20. At 18, while studying at the University of Texas, he took apart IBM PCs, studied them and then built and sold customized PCs with better performance specs, yet priced far lower (at that time IBM PCs sold in retail stores for $3,000).

“I realized that the components in those (IBM) computers were all made by somebody else, yet they were charging four times the cost of those components. It just didn’t seem fair,” said Michael Dell.

CUSTOMER FOCUS

Dell as a company is known for identifying technologies and products that make fat profits for its competitors, and then reengineering the same, to offer better performance at lower costs, yet embracing open industry standards. And it tops that with fantastic customer support, although it has received criticism for telephonic support in recent times. In the days of selling PCs, savings for Dell came in by eliminating the middle man (channel and retail), to sell directly to customers through the Internet and phone. Of course, Dell no longer sells direct today, yet the spirit of innovation and aggressive pricing continues within Dell, as it sells enterprise IT solutions: servers, PCs, tablets, thin clients, storage, networking, software and services.

Dell also continues that close engagement with its customers and partners; Michael Dell spends 40 percent of his time with customers and personally conducts “platinum councils” with CIOs around the world. He’s now doing the same with other entities like universities, where a lot of tech talent exists.

With the exception of direct selling, nothing else changes, inform Dell executives.

While Dell’s successes came from selling PCs and servers in the earlier years, it has now repositioned itself as an end-to-end enterprise IT solutions company, that wants to work closely with customers, to solve business problems and understand the opportunities.

“We are disrupting and democratising software, services and solutions the way we did with PCs and servers,” said Michael Dell during the keynote address.

FOUR IMPERATIVES

Dell is known to be a very customer-centric company, and it has aligned its business groups to better address customer challenges. To that effect, it identified four customer imperatives: Transform, Connect, Inform, and Protect.

‘Transform’ is about helping customers migrate from legacy infrastructure (mainframes, minis) to a new technology environment (with virtualization, cloud computing and data centres).  In migrating, customers will have access to flexible, scalable and agile architectures.

‘Connect’ focuses on increasing productivity by enabling the next generation workforce to work securely from anywhere, anytime and on any device (BYOD).

‘Inform’ helps customers gain control of their big data and to use it to drive insights, to gain a competitive advantage.

‘Protect’ refers to the protection from organised attacks to everyday behaviours of employees that unknowingly enable cyber theft.

FUTURE OF THE PC

Market research reports show a shrinking PC market, yet Dell continues to believe in, and sell  thousands of PCs to large customers such as Boeing. Industry observers say that PCs are a way for Dell to get its foot in the door — to sell other enterprise solutions to corporations.

“Customers tell me that these devices are extremely important and relevant. PCs help get business done. So we’re investing, innovating , and differentiating in this space,” said Michael Dell.

IMG_0372The flood of tablet brands in the market does not deter Dell from making its own. We checked out the Dell Venue range of tablets at Dell World, and were surprised by their form factor and unique features like full Windows 8.1 (not RT), IMG_0373USB ports, wide HD screens, large memory, good battery life, and smart accessories. Aggressive low pricing, security, and management features make the Venue tablets a worthy consideration. However, these tablets are configured mainly for business applications, and ideal for use by a sales force or on the shop floor, for instance. We’ll have to see how home users take to the Dell Venue tablets, this holiday season.

The other area where Dell sees huge potential is virtual PCs or thin clients. It offers a product called Dell Wyse — an integrated hardware and software solution. As organizations increasingly take to the cloud, there is demand for front-end devices like virtual PCs to access back-end applications and data residing in data centers. And this is what Dell Wyse offers.

TECH INNOVATIONS

Dell has always been known for its disruptive tech innovations. In 1996, Dell surprised audiences at the Comdex IT exhibition (the major industry show back then) with the launch of a 12 Mhz PC (the fastest PC until then was clocked at 6 Mhz). Dell knew that if it did 8 Mhz, the competition would soon catch up, so why not 12 Mhz (although it also had a 16 Mhz unit in its lab)?

IMG_0368That spirit of disruptive innovation continues even today. For instance, Dell proudly showed its Fluid Cache for SAN breaking the IOPS record (Input/Output Operations Per Second) and clocking in at 5 million IOPS (its competitor did 3 million IOPS). This is a flexible enterprise application acceleration solution that integrates servers, networking and storage. With that kind of performance, enterprises will be able to handle a greater number of transactions, and experience faster response times. And that’s good for business especially during peak periods.

The other tech innovation on display at Dell World was the 4K x 2K ultra HD, UltraSharp monitors. These monitors are aimed at professionals in the creative and design space. Of course, the natural progression for Dell in this area is smart TVs and Internet TVs with ultra high resolution displays. In fact Dell currently sells smart TVs from Samsung and Sharp.

We’ve mentioned the innovations in the tablet space, but there was another mobility innovation that caught our attention at Dell World. It’s called the Dell Enterprise Mobility Management (EMM) solution. The mobility solution is currently in the beta testing phase. The unified mobility solution can manage both consumer-owned and company-owned mobile devices, through policies. For enterprise devices, it offers the usual end-point management. But for consumer-owned devices it builds a secure container in the device, and holds all corporate data and applications in a ‘container’. The user’s personal data and applications (outside the container) are not compromised or governed by the corporate policies — nor can they intrude on corporate data. This technology comes from its acquisition of KACE last year.

Unlike traditional EMM platforms, which typically include separate tools for managing mobile devices, apps, content and users, Dell has consolidated the capabilities organizations need in an end-to-end mobile enablement solution.

Dell VRTX servers and 12th generation PowerEdge servers have also been acclaimed for their engineering innovations and performance. The former is a shared infrastructure platform with simplified management features, making it ideal for small to mid-sized businesses — or remote/branch offices.

INNOVATION VENTURE FUND

As we mentioned earlier, Dell fosters the spirit of entrepreneurship and innovation. Dell Ventures, Dell’s strategic investment arm, announced an expanded commitment to entrepreneurship and innovation with a $300 million Strategic Innovation Venture Fund. The fund will enable Dell to invest in early-to-growth-stage companies in emerging technology areas including storage, cloud computing, big data, next-generation data center, security and mobility.

The Strategic Innovation Venture Fund is Dell’s second major investment fund and builds on the $60 million Dell Fluid Data Storage Fund announced last year. Since then, Dell has completed road shows to meet with entrepreneurs and VCs in Silicon Valley, Boston and Israel, reviewed hundreds of companies and invested in numerous start-ups that have contributed to Dell’s storage and end-to-end solutions innovation. As the global business environment evolves and customers are increasingly challenged by the pace of change with virtualization, cloud computing, big data and mobility, Dell is expanding its venture investments to new areas of IT innovation.

INDUSTRY PARTNERSHIPS

Dell is also known for its affable industry partnerships and is a long-time ally with Microsoft. At Dell world it also announced partnerships with Red Hat and Accenture.

Dell and Red Hat will jointly engineer enterprise-grade, private cloud solutions based on OpenStack to help customers move to, and deploy highly-scalable cloud computing models. As part of the expanded relationship, Dell becomes the first company to OEM Red Hat Enterprise Linux OpenStack Platform. The co-engineered solution will be built on Dell infrastructure and Red Hat Enterprise Linux OpenStack Platform. The solution will be delivered by a Red Hat Enterprise Linux OpenStack Platform practice within Dell Cloud Services.

At Dell WorldDell announced that it is expanding its worldwide agreement with Accenture to address some of the most pressing technology challenges businesses face today, particularly during business transformation. To accomplish this, Dell and Accenture have signed a four-year global go-to-market agreement to jointly develop and sell a new set of offerings designed to deliver improved enterprise efficiency, higher security, and better business outcomes.

Under the go-to-market agreement, the companies will work together to build, implement and manage data center solutions for mid-market and select enterprise customers who want to drive business innovation while controlling costs and reducing risk. The agreement will bring together Dell’s end-to-end portfolio of infrastructure, software, and services with Accenture’s capabilities as well as Avanade’s, which was created in 2000 as a joint venture between Accenture and Microsoft. This agreement augments Dell’s existing cloud capabilities in hardware, software and services.

And Dell announced it is building on its strategic alliance with Microsoft to deliver Windows Azure to Dell customers worldwide through the Dell Cloud Partner Program. This expands upon the previously announced alliance providing Application Development Services on Windows Azure.

With the evolving Dell-Microsoft relationship, current and future customers will have even more choice and flexibility when pursuing and planning public cloud infrastructures. Acting as a single-source supplier through the Dell Cloud Partner Program, Dell will offer customers a central point of solution integration, control and direct support, lessening the complexity and challenges of deploying cloud environments.

THE NEW DELL

As a private company, analysts says Dell will move at a faster pace, making faster strategic decisions, introducing new products, moving to new markets, making strategic acquisitions (particularly for Cloud and data center), and continuing to invest in start-ups. Now it can also take a longer term view, as against a quarter-to-quarter review and realignment, as public company.

At a customer panel discussion, Kevin Dunn, VP Business Information Services, First Command Financial Services was asked how he sees the new privatised Dell. “I see more engineering and collaboration coming out of Dell, in a private way,” he said.

Another customer on the panel said, “A lot of innovation comes from (start-up) companies that have ideas, so it is great to see that Dell is going to fund and work closely with a lot of start-ups.”

And yet another customer said, “The days of doing generic boxes are done. Now it is all about technology innovation. It is also about building an ecosystem and working with trusted partners.”

We think that Dell has all these ingredients that will ensure its success. As a privatised entity it will move towards market leadership more quickly. What we are unsure about is how it will continue to get its funding to invest in R&D and market expansion. What happens once the funding from Silver Lake Partners dries up?

To keep going, Dell will need to pursue new areas of profitability such as Analytics, Business Intelligence, Security, automated tools, and network or data center management software. And that’s where its one-year old software division (headed by former CA CEO John Swainson) will have to chip in, with engineering effort and new products. Software defined networks and data centers are the future.

Services (led by Suresh Vaswani) also holds a lot of potential, with Dell currently playing in sectors like Healthcare, BFSI, Education and Government/PSU.

Mobility and devices is another area that Dell is hotly pursuing. And solutions that help companies get on the cloud will bring in significant revenue.

But to sell all this, Dell will need to revitalize its sales force and channel (see box, Dell revamps channel program). Presently, channel confidence is at an all-time low in India.

To know Dell’s destiny you need to watch its performance closely in 2014, as this will be its inflection point.

The next Dell World will be conducted in Austin, TX in November 2014.