Dell adds servers and PowerOne to consumption model with Dell Technologies On Demand

As part of an expansion of its consumption-based and as-a-service offerings, Dell’s PC-as-a-Service offering is also being extended further downmarket, to the tiniest of businesses.

AUSTIN – While the big news at the Dell Technologies Summit here was the introduction of the new PowerOne autonomous infrastructure, Dell also made an announcement of some significance around how they take their products to market. They announced Dell Technologies on Demand, which is an expansion and rebranding of their consumption-based and as-a-Service models. Most obviously, it incorporates the newly-announced PowerOne portfolio. However, it adds Dell’s PowerEdge servers to the consumption-based model for the first time. Another notable tweak was the extension of their PC-as-a-Service offering further downmarket, to deployments which in the theory could be as small as a single machine.

“We are now at a point where we can take on the next level of challenges and create more value,” said Jeff Clarke, Dell Technologies’ Vice Chairman, Products and Operations. “Today, we are taking a big step with Dell Technologies on Demand, the industry’s broadest consumption-based and as-a-service delivery model.”

Clarke noted the three financial consumption models under Dell Technologies on Demand through which customers can acquire their technology: a Pay As You Grow model that aligns to deployment schedules, a Flex on Demand monthly metered option, and a Data Center Utility model that offers the most customization for larger customers. All these are backed by Dell ProDeploy, ProSupport and Managed Services.

“It’s an unmatched choice of portfolios, which provide choices how to consume modern infrastructure,” Clarke said. “Dell Technologies is poised to help customers unlock the full potential of data.”

“Scalar in Canada brought us a media and entertainment customer, Cinesite, for whom Flex on Demand with Isilon was a perfect solution,” said Bill Wavro, President and General Manager, Dell Financial Services, Dell Technologies. “They get additional capacity on demand, but don’t pay until they use it,”

While the Dell Technologies on Demand brand is new, the large majority of options under that brand are not. The core consumption-based and as-a-Service models have been available for several years. The new brand – and emphasis on the space by Dell – reflects a couple of things. First, they see the market as poised for enormous expansion and want to draw attention to it. And secondly, there actually a few net-new things in here, which should have special resonance for channel partners.

Dell highlighted multiple times during the event a Gartner report projecting that by 2022, 15% of new deployments of on-premises computing will involve pay-per-use pricing, up from less than 1% in 2019. Dell is not the first vendor to emphasize this data point, and is unlikely to be the last. It has enormous significance, for while even the 2022 number is still a small percentage of total spend, it represents an exponential increase in Total Addressable Market. While it comes at the expense of traditional on-prem sales, it’s still a necessity in an environment where more customers want OPEX pricing and demand more choices.

“We are just at the beginning of the as-a-service model for on-premise equipment, said Sam Grocott, SVP Product Marketing, at Dell Technologies. “Customers are looking for OPEX-structured as a service delivery model, which provide all the advantages of on-prem like performance, compliance and security. This lets customers consume infrastructure and services any way they wish.”

The big change is that the purchase options of products available under these options have been expanded.

“We have enhanced the portfolio with servers, and our new PowerOne technology,” said Erick Brown, VP, Dell Technologies on Demand, Dell Financial Services, Dell Technologies.

The PowerEdge servers, which are particularly important to the channel, have not been sold this way before.

“This allows a very granular choice of server options – with pricing down to the hour,” Brown indicated.

The addition of the PowerOne portfolio is also notable because the ability now to sell all the products together is likely to increase total deal size, which for some customers, increases the attraction of OPEX purchasing.

The other noteworthy change is that Dell’s PC as-a-Service option, which was originally designed for very large customers, continues to be expanded downmarket. Dell originally announced that this offering was being expanded into the SMB space at VMworld in 2018, with the original offering being rebranded specifically for the enterprise. At that point, the SMB offering was focused on the 20-300 unit market.

“Now, with these changes, it can be as few as a single device,” said Akanksha Mehrotra, VP, ISG Marketing, Dell Technologies. “We do see an enormous opportunity in expanding on that.”

“This is something that we have heard a lot from smaller businesses,” Wavro said.

This smaller market is fairly niche for most Dell channel partners, but Mehrotra said that the overall messaging that the service now covers all customers is of value to Dell.

“We did see an opportunity to simplify the marketing,” she noted.

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