Cloud Provider Commentary

Jul 2 2012   4:04PM GMT

Dell buying Quest for $2.4B: Is there a cloud play up its sleeve?

Jessica Scarpati Jessica Scarpati Profile: Jessica Scarpati

We’re all in agreement, right? Dell’s decision to buy Quest Software for $2.4 billion means it’s putting its hardware-junkie days behind and moving with the market by adopting a more software-focused strategy.

But hey, could we please get a little more specific? The New York Times’ Dealbook blog takes a stab at what John Swainson, president of Dell’s software group, means when he says, “The addition of Quest will enable Dell to deliver more competitive server, storage, networking and end user computing solutions and services to customers” in the canned statement everyone is quoting.

Dealbook, quoting an analyst from Pacific Crest Securities, suggests that Dell may be after Quest’s “back-up and recovery applications, virtualization services and its single sign-on solution,” noting that its other software products are “slower-growth businesses.”

Is there any cloud play here? Maybe not, and what’s a blog good for anyway if not conjecture? But the points about virtualization and single sign-on seems to indicate we’re at least getting warmer. Joe Panettieri at Talkin’ Cloud offered an intriguing theory — posted yesterday before the deal was announced:

Quest Software specializes in IT management, desktop virtualization and cloud migration software and services. The company is one of the best-known providers of Office 365 migration services, helping customers to shift from on-premises Microsoft applications to SaaS versions of Exchange, SharePoint and more.

But here’s the interesting twist: A lot of those on-premises customers use Dell servers. It’s a safe bet Dell will leverage Quest Software to shift customers into Dell’s own cloud — assuming Dell really is buying Quest.

If he’s right, could it be what Dell needs to establish itself in the cloud provider market?

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