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Business Briefing

Dell Buys Wyse Technology To Expand Cloud Strategy

Dell Buys Wyse Technology To Expand Cloud Strategy
April 2, 2012 3:03PM

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Dell's acquisition of Wyse Technology expands its cloud and virtualization portfolio. Consumers and businesses alike are adopting tablets and smartphones as their preferred computing platforms. The mobility software developed by Wyse Technology gives Dell a potential opening to exploit this trend. Dell plans an end-to-end cloud offering.

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Dell has agreed to acquire privately held Wyse Technology to extend its own desktop virtualization offerings. Dell's proposed deal for the San Jose, Calif.-based cloud client computing technology provider has already been approved by the boards of both companies. The financial terms were not disclosed.

With Wyse's technologies under its belt, Dell's ultimate aim is to deliver complete end-to-end desktop virtualization offerings to its customers -- either directly or through Dell's third-party partners. The deal is expected to close in Dell's second business quarter, which ends midsummer.

The Wyse portfolio includes thin, zero and cloud PC clients featuring advanced management, desktop virtualization and cloud software supporting desktops, laptops and next-generation mobile devices. The acquisition of complementary desktop virtualization offerings from Wyse is expected to enable Dell to offer customers a broad set of computing choices -- ranging from the edge to the core, said Jeff Clarke, president of end user computing solutions at Dell.

"Desktop virtualization can help organizations streamline IT management, improve productivity and security, and increase cost efficiency for discrete workloads or usage scenarios," Clarke said Monday.

Analyst Expectations

According to IDC, Wyse led the field with respect to thin client shipments during last year's fourth quarter. The company has shipped more than 20 million units worldwide to date, with more than 200 million users interacting with the privately held company's products on a daily basis.

IDC Vice President Matt Eastwood expects the desktop virtualization market overall to continue to realize strong growth globally -- with the larger revenue and margin opportunities coming from the sales of data-center infrastructure as well as cloud and services offerings tied to thin client and desktop virtualization technology sales.

"Thin client and desktop virtualization solutions typically drive high attach rates to data center solutions -- including servers, networking, storage and services," Eastwood said. The revenue generated by the "end-to-end data-center infrastructure stack for these solutions is expected to exceed $15 billion by 2015."

Consumers and businesses alike are adopting tablets and smartphones as their preferred computing platforms at accelerating rates. The mobility software developed by Wyse -- which delivers secure mobile connections to personal, private and public cloud environments -- gives Dell a potential opening to exploit this trend.

Gartner forecasts that traditional PC sales will grow at only a 4 percent rate this year. So Dell is doubling down on the segments of the company's business that offer better opportunities for realizing double digit growth. (continued...)

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