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Thread: Dell goes private

  1. #1
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    Dell goes private

    Dell in $24 Billion Deal to Go Private

    [T]he buyout — which was announced on Tuesday and would be the biggest by far since the days of the recession — is a huge gamble. It will saddle Dell with $15 billion of new debt, and it does nothing to divert the forces reshaping the technology industry and undercutting the company’s business.

    Fifteen years ago, Dell made enormous profits from selling customized PCs directly to customers. Six years ago, it was the world’s leading maker of personal computers. Today, it is in third place, behind Hewlett-Packard and Lenovo, and falling.

    Dell’s share of an already contracting market for PCs slipped to just 10.7 percent last year, from 16.6 percent six years earlier.
    Dell's share of the server market is still 22% of new shipments, but the article points out that the growth of the cloud server market has hurt that part of the business as well.

    Fifteen billion in new debt is an awfully large burden for a company in such a troubled industry as general-purpose computers are today. I've always liked Dell and have bought machines from them for two decades or more. If the market is going to end up split between HP and Lenovo, I'll choose the latter. People about to make some long-term hardware investments in their organizations might now start looking elsewhere even if they were a Dell shop in the past.

    I notice that Microsoft was willing to lend Dell $2 billion but do not appear to have purchased an equity stake. I wonder if they were offered one but declined.
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    Re: Dell goes private

    Bye bye project Sputnik?

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    Re: Dell goes private

    Their choice was a quick death by having someone else buy them--such as Microsoft. Or a slow death by purchasing up their own shares and better managing their own demise.

    Which would you choose?

    Dell doesn't seem to be in good position right now, and the money needed to buy back shares means they won't have the cash to invest in new ideas.

    Look at what is happening to other large technology companies such as Nokia and Blackberry/RIM.
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    Re: Dell goes private

    This could be the turn-around they need, too. As I read elsewhere this frees them from SEC paperwork and reporting, as well as having to appease share holders.

    This last part means they can accept short-term losses or even just less profit in return for long-term upward motion!

    If they announced they were not going to sell any Windows computers and go 100% Linux they may be called a crackpot, and Microsoft may ask for their loan back ($2B) ... but they could! There are no shareholders to pressure the board to oust the CEO and the rest of that political drama.

    So while they are constrained by the market, they are free for decision making and even self-destructing if they want!

    They could even sell themselves to Canonical if they wanted to.
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    Re: Dell goes private

    Ok, this is silly talk but I'm going to say it anyway as the purpose of this part of the forum is to have fun.

    One journalist reported that an expert suggested Dell would buy a services company. What if they bought Canonical? You might come up with many perfectly valid reasons why not. But let's suppose for a moment they did. What would that mean for Ubuntu and what would it mean for Debian and FOSS in general?

    Projects like Orchard CMS already show that Microsoft is prepared to play the "community" card when it suits them and Dell is already implicated in server space.

    Is it so far fetched?

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    Re: Dell goes private

    Since we are in The Community Cafe and can talk freely. I hope Dell closes there doors and gos to He!!

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    Re: Dell goes private

    Quote Originally Posted by iamkuriouspurpleoranj View Post
    One journalist reported that an expert suggested Dell would buy a services company. What if they bought Canonical? You might come up with many perfectly valid reasons why not. But let's suppose for a moment they did. What would that mean for Ubuntu and what would it mean for Debian and FOSS in general?
    Why would Mark sell Canonical? It owudl go against the principles he promotes.

    Why would Dell buy them? and with Mircosoft money?
    MS loan to Dell will be 2bn $
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    Re: Dell goes private

    While I don't doubt Mark Shuttleworth's commitment to the Ubuntu project, it is possible for people to change their minds.

    People are currently talking about MS Office for Linux and I would buy it if it ever came to market. Currently, I am a 100% Linux user and use no MS applications via Wine.

    One thing should be clear from this: I am not in anyway a Microsoft customer.

    They have no touch points with me with which to build future sales. None whatsoever. I don't even use Skype. To all intents and purposes, I have disappeared from the MS map.

    Now, since I am 100% happy with my 100% Linux situation, I might pass this enthusiasm on to other people and "pop" there goes another MS customer.

    If MS produces Office for Linux - and there is nothing to suggest they are doing anything more than thinking at this stage and even that is hearsay - they retain contact with Linux users: a platform from which to build future sales. In addition, the fact that many Linux users happily use lots of proprietary software/codecs might suggest to MS that they have a potential market.

    If Dell buys Canonical, they acquire the latter's server customers and acquire influence over Ubuntu and by implication some influence over Debian, where let's face it, resistance to the reach of Microsoft is the greatest.

    Of course, all this is completely speculative and is basically pub chatter. It could happen but then so could many other things

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    Re: Dell goes private

    Quote Originally Posted by sammiev View Post
    Since we are in The Community Cafe and can talk freely. I hope Dell closes there doors and gos to He!!
    You can not talk freely anywhere here. Please observe the Code of Conduct.

    A post like this brings little value to the discussion. Another style is appreciated.
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    Re: Dell goes private

    Quote Originally Posted by iamkuriouspurpleoranj View Post
    Of course, all this is completely speculative and is basically pub chatter. It could happen but then so could many other things
    yup.

    especially since Mark went as far as to establish a fund in case Canonical goes broke or the project doesn't succed so that community could continue with Ubuntu development.

    Debian project is independent though some Ubutnu patches do go upstream. most i believe comes down stream though. Microsoft provides auite a bit of patches to linux.

    Also there is still that bug no. 1 on launchpad that has to be solved.
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