Gearing up for Networking

With the launch of a new range of switches, Dell is aiming to play a bigger role in the enterprise networking segment.

By Pankaj Maru

Dell recently launched a new range of switches in W, N and C series. Like its existing networking switches such as the Z (core networking switches), E (virtualized chassis switches) and S
(managed switches) series, Dell’s new series continue to focus on specific areas and needs of enterprises like mobility and BYOD.

For instance, the W­series, as the name suggests, offers wireless networking at high data rates to enterprises. The N­series includes energy­efficient and cost­effective 1GbE and 10GbE switches
for scalability.

And the C­series comprises of robust high­performance switches for enterprises that want end­user mobility and reduced congestion.

It’s quite interesting to note how Dell has been steadily building and expanding its networking, storage, computing, security and services capabilities largely inorganically via key acquisitions
over the years. Specifically, the Scalent and Force10 acquisitions have helped Dell aim for a bigger share in the enterprise networking segment against more established vendors like Cisco, Brocade, Juniper and others.

A look at Dell’s revenue mix reveals the better performing product segments for the company.

The company reported over 8% yearly growth in its Enterprise Solutions Group business with $3.3 billion revenue in Q2, FY14 — up from over $3 billion it reported in Q2, FY13. The servers,
networking and peripherals business contributed 87% to the group’s total revenue while storage added just 13%. While storage was down 7% for the reported quarter, the networking business unit grew over 19% and has shown steady growth over the past  10 straight quarters.

Building on Force10 acquisition

According to S Sridhar, Director, Enterprise Solutions Group – Dell India, post the Force10 buyout in 2011, the company has ramped up its engineering team from 150­odd people (at the time of Force10 buyout) to 600­plus in the past few years. The additions include the design engineers at Dell’s facility in Chennai.

“We have carved out a smaller component of this team which is capable of working on India projects, so we are able to design customers’ products and projects using our research and design capabilities,” Sridhar told Express Computer in an exclusive interaction in Bangalore recently. With those buy­outs in the networking space, Dell is trying to bring in some changes in the traditional enterprise networking architecture.

“Traditionally we are used to a 3­tier networking architecture, which includes the client layer, application layer and the storage layer — all linked through networking and switches,” explained
Sridhar.

Moving from 3­tier to 2­tier networking architecture

Dell, however, is trying to change this traditional 3­tier networking architecture approach into a new framework across its infrastructure solutions — with the objective of enabling enterprises with
direct server­to­server and point­to­point communication.

According to Sridhar, what Dell is trying to do is crash one of the layers out of the traditional 3­tier model and enable a scale­out type architecture. The idea is to enable increased direct communication among servers even when the environment is virtualized so that there is less communication load on the rest of the infrastructure.

Cracking the networking nut

Over the past two years or so, Dell has been pushing its networking portfolio (especially through campus networking and data center networking projects) harder than before to establish itself as a serious contender in the networking market.

“From an enterprise point of view, Dell is capable of providing more cost­effective and energy­efficient networking switches compared to what the competitors are offering,” Sridhar said. Further, he added that Dell’s latest switches come with augmented capabilities based on open standards, which allow these switches to function in heterogeneous environments.

Challenges for Dell

For Dell, being a non­native networking player makes it harder to convince enterprises and potential customers of its networking solutions. “In many customer opportunities, we are still not seen as a native networking player but over the last two years, gradually and slowly, we have been explaining our networking capabilities to them,” Sridhar said.

Over a period of time, Dell will slowly phase out some of its existing products and replace them with new ones. The company believes that the upgraded switches portfolio will help it better
explore the market and tap into more existing as well as new customers.

“As a player who is probably in the infancy stage in the group, any market is a good market for us. If you look at our installed base, we have a large installed base of servers and an increasing
base of storage solutions, which only provides us the opportunity to go and have more complete conversations with the customers,” Sridhar pointed out.

Winning large enterprises and customers looks a bit hard and is a time­consuming exercise for Dell. And that is why, according to Sridhar, the company is looking more at segments like mid­size
companies, educational institutes and manufacturing outfits for sales opportunities.

In a bid to establish itself as a networking player, Dell is taking several key steps, including marketing campaigns, building a strong channel partner network, and relying on some of the
existing customers to speak for its technology capabilities and solutions. The next few quarters could potentially turn a new leaf for Dell as far as networking is concerned.