Dell is one of the world’s biggest PC sellers, shifting millions of desktops and laptops every year, which is why a rumor that it may be in talks to merge with storage giant EMC is huge news. It’s surprising somewhat, in that EMC has struggled to turn a profit with its cloud businesses. However with more of the world’s files and folders being held online, perhaps Dell sees cloud storage as at least part of its future, alongside hardware sales.
While there are plenty of potential roadblocks for any such deal, as Ars reports, if it does go through it will be one of the biggest technology mergers of all time, especially since it won’t only mean Dell is taking on EMC’s storage business. EMC also has an 80-percent stake in virtualisation company VMware, which Dell would also acquire as part of any takeover bid.
Discussions are ongoing, and of course there’s no guarantee that Dell will merge with EMC. Dell is reportedly looking to offer around $40 billion for the company, which it will need to source from somewhere. As rich as Dell is, it doesn’t have that sort of cash on hand — it isn’t Apple.
As well, Dell will also need to receive approval from EMC’s shareholders, some of whom have representatives on the company’s board.
If these two entities do merge to create a super-corporation however, it wouldn’t be the first time a traditional hardware venture began to move into software-based enterprises. HP is still one of the world’s largest PC sellers, but it too has made big steps in recent years to reposition itself as a cloud vendor, offering storage and analytics for various corporate entities around the world.
And while Microsoft has made recent steps to up its hardware game, its push for subscription model software-as-a-service packages is further evidence of this trend among the long-standing tech companies.