Celebrating the second anniversary of its entry into the UK market this month, Dell Computer Corp Ltd took the opportunity of catching up on US product announcements, reviewing its progress so far, and, with the help of whizzkid founder Michael Dell, revealing a little about the company’s future directions. The new products included the two new 80386-based systems – Modess 310 and 325 – launched at the UniForum Unix trade show in San Francisco last March (CI No 1,122), and the more recently introduced Model 316 80386SX machine (CI No 1,152), along with high resolution GPX-1024 graphics controller and GPD terminals (CI No 1,161). The machines mark Dell’s entry into the Unix market, and run a Dell-enhanced version of Unix System V/386 release 3.2 from Interactive Systems Corp – Dell now counts itself amongst the Unix experts following the defection from IBM of AIX/Unix experts Glenn Henry and Charles Sauer – but also run enhanced versions of OS/2 and MS-DOS. Prices in the UK range from around UKP4,000 for an entry-level SX configuration up to UKP10,000 for a 16-user Model 325 with operating system, 8Mb RAM, 320Mb hard disk, VGA monitor, keyboard and intelligent input output card. Comparable configurations from Compaq and IBM could cost up to 50% more, it said. The new announcements mark the second phase of the company’s development, according to UK managing director Martin Slagter. The first phase established Dell’s technical credentials in the personal computer market, a task more easily accomplished than the controversial direct relationship marketing strategy, pigeonholed by many observers as mail-order marketing. However, Slagter maintains that the approach has been the key to Dell’s success: many people have bought from us because they would rather receive service and support from Dell than from a dealer, he said. Dell achieved a turnover of $258m last year, and recently reported its best ever first quarter of $87.5m, up 86% from the same period last year, although profits are not keeping pace. According to Michael Dell, the company is on target to overall growth rates of 65% next year, which will take it up to a turnover of around $400m. UK sales currently contribute around 15% of total revenues, and total non-US sales around 22%. The temporary stumble towards the end of last year that sent the share price tumbling was a result of temporarily excess inventory, which we have now worked down, said Dell. Phase two of the company’s development is now underway, and means an increased focus on high performance machines for advanced business, engineering and scientific applications. And although the direct marketing and manufacturing to order policy will remain, Dell is now recruiting a network of value-added resellers who will use the Dell hardware as a platform for their own vertical solutions – particularly important for Unix sales. As for future Dell products, Michael Dell promised that his company would be one of the earliest players in the 80486 market – we already have machines working in the labs, and will be ready as soon as Intel can ship parts. Parallel processing Dell said that 10 patents around the new 80486 technology have already been filed, and was very sceptical about IBM’s approach of putting an 80486 processor in a machine primarily designed to use the 80386. He also refused to acknowledge any performance advantages from the Micro Channel Architecture, but said that Dell would ship both MCA and EISA machines if it saw evidence of any customer demand. Currently spending $20m a year on research and development, Dell also has multi-processing and parallel processing projects under wraps, and anticipates that it will be ready with further announcements when the 80486 machine is released. The company is also looking at Intel’s 80860 processor for parallel processing under Unix, and as a co-processor under OS/2. Other future developments include adoption of the OSF/Motif graphical user interface, and 80386-based battery powered laptop.
