Michael Dell Puts His Own Money in Red Hat - Does Dell Have a Linux Desktop Plan?
In an article in the Triangle Business Journal republished on MSNBC, the news outlets revealed a $100 million investment made in Red Hat by Mr. Dell. According to the news sources:
Billionaire Michael S. Dell, founder and chairman of Dell Inc., has placed a $99.5 million bet on Red Hat.
While the investment appears relatively benign and certainly not something Michael Dell might use to take over Red Hat, it could have strategic value. IF Dell's executives haven't considered the play, perhaps they should.
What Linux Needs for a Consumer Play
Apple Computer has done an excellent job of creating a niche hardware business by not becoming part of the Intel Industry Standard Architecture alliance. If you want peripherals and other hardware, you buy it from Apple and you pay a premium. They also have enough market share that major Microsoft ISVs have ported products to the Apple Macintosh. That list even includes Microsoft.
If Dell provides Linux drivers to its own consumer items such as printers, PDAs, Digital Cameras, etc. then Dell would stand alone as the source of a complete Linux solution. That could catapult Dell past HP and put another 5% of the PC market in Dell's pocket.
Additionally, Dell would endear itself further to the enterprise and government market space where an alternative desktop to Windows in more than a hope. Dell's overseas prowess would certainly increase.
People often have called Dell Computers the hardware division of Microsoft because of the close relationship the two companies share. Would Dell lose its most favored status with Microsoft and would it lose its "marketing allowances" from Microsoft if it offered complete Linux solutions?
That has to be a major concern to Dell Computers. But, can Dell's executives see the writing on the wall? Microsoft will lose market share and that will happen faster than anyone believes. Dell can ride the trend down or beat people to the punch.
If you gamble, you might want to handicap this one. Dell remains a Microsoft shop. They haven't even strayed into the AMD processor space. But then, Michael Dell didn't become a billionaire and innovate how computers are purchased by sitting on the side of the road waiting to see who he could follow.
As drastically and surprisingly as Microsoft changed the computer landscape over the past ten years, Dell has that same ability. I'm guessing he will figure out how to have it all. He always does.
MSNBC Article - Michael Dell sinks $100M into Red Hat
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