One differentiator we talk about Dell having is our mid-market design focus. The mid-market is the largest and fastest growing portion of a ~$2.7 trillion IT industry. It’s more than 60% of the IT industry and approximately 75% of the commercial IT industry. The mid-market includes customers from parts of our Medium and Large Businesses as well as Public customers in Health Care and Education. A mid-market design focus doesn’t mean we are bypassing other parts of the market. In fact, we believe that our mid-market design focus enables us to better serve the needs of our largest and smallest customers. Innovation has historically happened in the mid-market space – examples include x86 servers, iSCSI, virtualization, cloud and social commerce - they all started in small and medium and they migrate to large, and eventually to global. We’ve found it is much easier to scale up and down with a simple mid-market solution rather than pushing down and under-featuring a complex solution.
Some examples of our mid-market design focus include vStart, KACE and our PowerEdge C servers. vStart is a fully integrated system that simplifies virtualization by including servers, storage, networking, management tools and deployment services in one preassembled, validated solution. We offer it in various increments ranging from 50 to 200 virtual machines and the result has simplified virtualization for our customers. Another example of mid-market design focus is KACE. KACE is a leading systems management company tailored to the requirements of midsized businesses. By incorporating the mid-market designed offerings into our distribution and sales capabilities we’ve been able to grow KACE revenues more than 8x since being acquired by Dell in 2010. Finally, in the hyperscale market where Dell is a worldwide leader, we’ve launched our PowerEdge C servers that provide maximum density for scale out data centers. Those servers are right sized to provide Web 2.0 building blocks to mid-market customers while minimizing their total cost of ownership.
Dell maintains a point of view which also uniquely positions us in this space and complements our mid-market design focus. Our view is one of customer choice and customer driven solutions incorporating open standards that are scalable and affordable. Competitors have gone to a closed, proprietary approach before and the pendulum will always swing back to open solutions – the industry has been going that way for the past 20 years, and is unlikely to change. We understand our customers have already invested in their infrastructure and they don’t want to underutilize previous investments. They are looking for solutions that can leverage their existing environment.
As we invest organically and in-organically we will continue to hold to our mid-market design focus and we believe it differentiates us from our competition. As always, we welcome your comments.