Dell puts $1bn into services and cloud unit as business shifts

Dell is investing $1bn over the next two years in its cloud and services division, in a move that will see it selling virtual PCs alongside their hardware equivalents.

The company will build 10 new state-of-the-art datacentres in Asia, Europe and the US to increase its public and private cloud hosting capabilities.

In addition, 12 Global Solution Centers will open this year, with another 10 planned for the next 18 months, to provide local sales and support to back up Dell's increased computing capacity.

"This signifies a major push for Dell as a services company," said Steve Schuckenbrock, president of Dell Services.

"We're committed to a $1bn investment in solution capabilities and infrastructure, and selling that capability. It's an important time in the industry during the virtual era, and it's amazing to see this inflection in the IT industry which changes everything about provisioning infrastructure."

Virtualisation is still lagging behind because installation is difficult and disruptive, and Dell will add new services to make this easier, Schuckenbrock said.

These include vStart, an out-of-the-box bundle of 100 and 200 virtual PCs, running on Dell's PowerEdge servers, EqualLogic storage systems and PowerConnect switches.

The package is shipped direct from Dell ready to plug in and run with minimal setup, and includes hypervisors and virtualisation management extensions.

"Customers are now more interested in buying virtual machines than in getting the hardware to assemble them themselves," said Praveen Asthana, vice president of enterprise solutions and strategy for Dell.

"Gartner is predicting that half of IT workloads will be run on virtual machines next year, but they're still not that easy to do."

To support these PCs, the company will release a series of Dell Desktop Virtualisation Solutions designed to help companies set up, run and manage virtual systems.

Dell could host these in its datacentres, but Schuckenbrock said that the company is not looking to get into the infrastructure-as-a-service business and is focusing on selling these systems for private cloud networks.

On the storage front, Dell is adding a new range of preconfigured file and email archive systems that can be added to corporate systems simply and to scale. These will be sold in a variety of storage configurations to suit small and larger businesses with a choice of archiving software providers.

The company also announced a three-year partnership with Microsoft to ease the management of cloud systems under Windows Server Hyper-V and System Center.

All services and products are available in the US immediately and will be launched in Europe this July, with a staggered rollout across the rest of the world later in the year.