Dire Dell

(By Richard Holway 8.00am 27th Feb 09) Dell’s results last night were pretty bad showing a 16% fall in revenues to $13.4b. See FT report - Dell profits drop as business takes a battering

Dell’s results were used as an illustration of the woes of the industry as a whole. Whereas I think they are much more of a reflection on Dell.

1 – Dell is still stuck in a model which was great 10 years ago but the world has moved on – Dell hasn’t.

2 – Whereas IBM has moved out of PCs and, in the last ten years has worked hard to position itself as a much more rounded ‘services’ company, Dell has yet to make any effective moves in that direction.

3 – Dell’s extremely poor customer service a few years back has left an indelible mark. Whereas customers (like us) would loyally buy Dell, that loyality has evaporated. To be honest, with the exception of Apple, I can’t think of anything in the hardware sector that I would now buy on ‘brand’ alone.

4 – Even on its homeground of PCs and laptops, Dell has failed to move with the times; allowing Acer, Asus etc to ‘eat its lunch’ in the netbook market.

Bluntly, I don’t see Dell’s fortunes changing anytime soon either.

Footnote - Just to add to the competition for Dell, Nokia yesterday announced that is to enter the netbook market. "We don't have to look even for five years from now to see that what we know as a cellphone and what we know as a PC are in many ways converging," Chief Executive Olli-Pekka Kallasvuo said. "Today we have hundreds of millions of people who are having their first Internet experience on the phone."