UPDATED 02:17 EST / OCTOBER 16 2015

NEWS

Customers voice concerns on the Dell/EMC deal

Just under half of EMC Corp.’s customers have admitted to being concerned that the company will be acquired by Dell Inc., saying they believe the move will be a big distraction and ultimately unsuccessful.

The concerns were raised in a survey by 451 Research held in the wake of Dell’s announcement that it intends to buy out EMC for $67 billion. The deal, which is set to conclude by the middle of next year, will become the biggest tech merger/acquisition of all time.

Most analysts agree that, at least from Dell and EMC’s perspective, the deal will be a profitable one – even though it by no means assures either company’s long-term future. But a good deal for the primary stakeholders doesn’t necessarily equate to a good deal for their customers, and some 42 percent of EMC’s admitted in the survey that the merger “is not aligned with the goals of their organizations”. In addition, another 29 percent of EMC customers said the deal could be distracting for both Dell and EMC.

The survey shows that most EMC customers are confused and worried about the implications of the deal. It also underlines the extremely difficult task Dell/EMC has ahead of it to try and merge its overlapping product lines and reassure its customers the acquisition will benefit them in the long term.

Interestingly, the survey showed that Dell customers were generally less worried, with just 15 percent indicating a negative impression of the deal.

“Dell customers believe they will benefit from access to a much larger portfolio of technologies across storage, information security, IT services, servers and PCs from a single vendor,” said Dan Harrington, Research Director at 451 Research. “

451 Research said it surveyed 447 executives responsible for their company’s IT buying to gauge their immediate reaction to the Dell-EMC deal. The responses came less than 24 hours after the deal was announced.

Both Dell CEO Michael Dell and EMC CEO Joe Tucci have been mindful of how their customers might perceive the deal, and have made efforts to reassure them the merger is a positive development. In a statement, Tucci claimed “The combined company will be far more efficient and effective to operate as a private company,” and said the merger would help to ensure the two companies’ products worked better with each other, therefore providing more value to customers.

In another development related to the merger, Cisco Systems Ltd. CEO Chuck Robbins issued a joint statement alongside David Goulden, CEO of EMC’s storage business EMC II, pledging their continued support for data center appliance maker VCE, one of the smaller EMC Federation companies.

VCE’s fate has been a source of speculation among analysts due to Cisco’s stake in the business, and the statement seems like an effort to reassure customers that it’ll be business as usual, for now at least.

“Cisco and VCE also have long-term engineering, resale and support agreements in place to enable our joint collaboration and business,” the CEOs said. “With that shared commitment, you will experience no change in the pre-sales and post-sales engagement with VCE.”


A message from John Furrier, co-founder of SiliconANGLE:

Your vote of support is important to us and it helps us keep the content FREE.

One click below supports our mission to provide free, deep, and relevant content.  

Join our community on YouTube

Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts.

“TheCUBE is an important partner to the industry. You guys really are a part of our events and we really appreciate you coming and I know people appreciate the content you create as well” – Andy Jassy

THANK YOU