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Why Michael Dell is betting big on multi-cloud strategy

Michael Dell, Chairman and CEO of Dell Technologies. Dell Technologies and Microsoft have partnered to jointly deliver VMware cloud infrastructure on AzurePremium
Michael Dell, Chairman and CEO of Dell Technologies. Dell Technologies and Microsoft have partnered to jointly deliver VMware cloud infrastructure on Azure

  • Dell Technologies and Microsoft have partnered to jointly deliver VMware cloud infrastructure on Azure
  • Dell Technologies has also made about 100 investments in start-ups to get access to innovative technologies like AI, network capabilities and security

Las Vegas: When the global leader of a leading multi-billion dollar technology company devotes a large portion of his keynote to cloud computing, especially in a digital world that is obsessed with the role of cutting-edge technologies like artificial intelligence (AI), machine learning and deep learning, one may think that something is amiss.

But, given that a cloud infrastructure is the fulcrum on which all these cutting-edge technologies are thriving, it's hardly a surprise that Michael Dell, Chairman and CEO of the $91 billion Dell Technologies is evangelizing a multi-cloud strategy that binds the strengths of all his group's business units including VMWare, EMC and Pivotal, with that of its technology partners.

Consider, for instance, the partnership Dell announced with Microsoft Corp. on Monday, during his keynote at Dell Technologies World 2019 in Las Vegas. Satya Nadella, CEO of Microsoft, who attended the event in person, explained the rationale for the tie-up.

"In my close to 30 years of working in technology, I have not seen a trend like digital transformation. But what is needed to fuel that, is great infrastructure -storage, compute (computing power) and networking." The idea is to bring together the "best of VMware and best of Azure", he added.

Through this collaboration, the companies will jointly deliver VMware cloud infrastructure on Microsoft Azure (VMware has an exiting partnership with Amazon Web Service (AWS) too). Additionally, Microsoft 365 and VMware Workspace ONE customers will be able to manage Office 365 across devices via cloud-based integration with Microsoft Intune and the Azure Active Directory. According to Dell, the "goal is to provide a single view from edge to core to cloud--an integrated platform for our customers’ digital future".

With Azure VMware Solutions, Dell Technologies and Microsoft hope to give their customers the power to "seamlessly migrate, extend and run existing VMware workloads from on-premises (private cloud) environments to Azure without the need to re-architect applications or retool operations", Dell Technologies said in a press statement.

By integrating with Azure services, customers can also infuse advanced capabilities like AI, Machine Learning, and the Internet of Things (IoT) into their applications. Microsoft and VMware are also exploring initiatives to drive further integration between VMware infrastructure and Azure.

According to an August 2018 report by research firm IDC, more than 70% of companies are using multiple cloud environments, and the largest data center challenge most companies face is developing a successful multi-cloud strategy.

To address this challenge, Dell also unveiled Dell Technologies Cloud - a set of cloud infrastructure solutions to make hybrid cloud (across public and private clouds and the edge, regardless of location) environments simpler to deploy and manage by combining the strengths of VMware and Dell EMC infrastructure. As Jeff Clarke, vice chairman of products and operations of Dell Technologies, put it: “Cloud is not a destination; it’s an operating model."

Further, in a bid to help today's digital workforce be more productive, Dell Technologies also introduced its Unified Workspace solution, which uses data-driven insights to assess how employees are using their personal computers (PCs - desktops and laptops) — from the battery consumption and storage utilization to mobility requirements and most frequently-used applications — in a bid to help customers select the right PC and applications for each employee, and ship the devices pre-configured directly from the Dell factory.

All these announcements are building blocks of Dell's strategy to remain relevant to customers in today's digital world. The Dell Technologies family today includes Dell, Dell EMC, Pivotal, RSA, SecureWorks, Virtustream and VMware. When Dell first unveiled its blockbuster acquisition of EMC in 2015 for a whopping $67 billion, not everyone believed that he could pull it off.

As Dell himself put it during his keynote, "Everyone needs to reimagine themselves in this digital age." Even as Dell continues with the work of finding more synergies in his business units, the multi-cloud strategy is expected to pay good dividends. The reason: Enterprises are planning to move more workloads to the cloud as they work towards adopting a cloud-first strategy and implementing automated policies for governance.

On an average, companies are using or experimenting with nearly five public and private clouds with a majority of workloads now running in the cloud, according to the RightScale 2019 State of the Cloud Report from Flexera.

Dell clearly has competition in the multi-cloud space but the good news for the company is that while AWS still leads in public cloud adoption, Azure continues to grow more quickly and gains ground, especially with enterprise customers (which also explains the partnership with Microsoft). Google maintains the third position, and VMware Cloud on AWS moved into fourth position ahead of IBM, according to the RightScale report.

Adoption of Oracle Cloud is still small, but is growing well, it adds.

VMware vSphere, notes the report, continues to lead as a private cloud option (both in adoption and number of virtual machines, or VMs) followed by OpenStack and VMware vCloud Director.

To stay ahead of its competitors, Dell Technologies has also made about 100 investments in startups to get access to innovative technologies like AI, network capabilities and security. These investments are not a "location-specific strategy but a thematic strategy", according to Michael Dell.

Along with the company's multi-cloud strategy and the $20 billion his company has spent on research and development in the last five years, these bets are expected to reap the right rewards.

(Note: The writer's trip to this event was sponsored by Dell Technologies)

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