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Dell's Marketshare Decline Due to Intel?
timeOday writes "News.com reports that Dell's PC sales are growing more slowly than the overall PC market for the first time on record. Gartner's Charles Smulders blames Dell's decline on their allegiance to Intel, and cites Hewlett Packard's embrace of AMD as a key to their growing sales. Can Dell continue to shun AMD, or is a breakthrough imminent for the #2 chipmaker?"
Is it really Dell's allegiance to Intel, or is it market saturation?
The problem here is Intel doesn't have a processor that the public views as solid and powerful. They have a processor that fits that description (dual core mobile), but they try to push P4s at people instead.
Dell is only failing because they expect Intel to do all their work for them. If they want people to get back on board they'll have to convince them that their systems perform well.
Their models are so unlinked to the processors that they carry that this will be a disaster for dell to handle simply because they have a stupid branding scheme. Moving to AMD wont help dell, but solidifying their position will.
This whole summary is based on a false premise. I for one think it's absolutely absurd to suggest that following Hewlett Packard's business plan is a good idea. If you do that everyone will just think you're the other HP.
"And we have seen and do testify that the Father sent the Son to be the Savior of the World"
1 John 4:14
That's not fair at all. I had a power cord for my Dell laptop die, and the guy I talked to, Sameer, was nothing but helpful.
Dell has long been the leader because they have been able to ship easily configurable PCs quickly and dependably to their customers. Now anyone can do that. They used to offer premium discounts on their PCs. Now anyone can do that.
Dell has always used very marginal hardware in several levels of their lineup. Perhaps this is what has caught up with them. Another company who used to sell well until their reputation caught up with them was Packard Bell. If you keep shipping inferior product, at some point you will get called on it.
Now, does it hurt that they need to keep prices high in order to offer genuine Intel Inside PCs? You bet. But that's just a straw on the camel's back. It was the heavy load that broke the camel in the first place.
I think there are natural limits on growth. Every entity that grows has to fight entrophy. The larger something becomes, the more difficult it is to fight against entrophy. We see the same thing with biological evolution, with the growth and calapse of empires and religions. It just doesn't make sense (and I would argue it is not desirable), that Dell would contantly grow it's share of the market forever (and, of course, eventually it would have a monopoly if it did).
The question I have, is how could Dell sales NOT slow down?
I'd chalk it up to worsening customer service and support first. I know people who had been Dell users since win 98, but after purchasing a Dell within the last couple of years wont do it again because of their customer support and they dont last like they used to. I dont think the average buyer would actively seek and AMD over Intel, they would just pick AMD if it was cheaper.
That's not a Dell-specific problem. Name a major computer vendor that doesn't do that. HP, Gateway, Dell... it's all the same. Personally, I still like Dell's support and warrenty plans and have had great luck calling their support number, but for myself, I'd always build, so it's rather egal.
PART of the small business support is in the US. The whole sales and customer service small business group is not. You only get the full US team in the large enterprise group.
Also, I want to know why everyone thinks Dell is awesome. They're just notebooks from Sagers manufacturing lines (http://sagernotebooks.com/ and relabeled.
Just buy a Sager directly, skip the Dell process, and you can score an AMD Turion, X2, or heck, even a 7900Go SLI laptop, which is excessive and inane if you ask me, but, Sager seems to be where the real power lies these days.
I had been recomending Dell to my work, friends and family in the past, but this has changed... My work laptop is a HP Turion64 as we have decided to use the 64bit capable chips for our development. Before this most of our purchases at work were Dell. I recently bought a machine for home, yet again an HP becuase I wanted the Athelon 64 bit chip. 2 weeks ago, I saw pretty good deal for a mobo+cpu combo at Fry's and went for it, yet again an Athelon 64. All in all, Intel's in my home are the older stuff, and I wont be buying any more PCs anytime soon... yet, I am considering buying an Apple Mini Mac CoreDuo, and that will be the only intel inside my machines... and thats not because I want to buy Intel, but because, its an Apple outside! I would rather buy from Apple now than from Dell if I want an Intel solution. I get a really compact machine that can run OSX as well as Windows or Linux. No more Dells for me!
So for me, Dell lost my account for its allegiance to Intel. In otherwards, Dell chose to take away my choice of what CPU I would like in the PCs I buy, and I took my business elsewhere. I think Dell can learn a valuable lesson from all this... that trying to restrict customer choice by providing a single choice is not going to make them a winner. Now, only if they take this lesson to heart and also give the option to users to buy a naked PC or one that the user can request to have Linux pre-installed, so that we wont have to pay the Microsoft tax for an OS that gets dumped the first time the machine is booted up, Dell might win the hearts and minds of the developers that ultimately affect a lot of corporate purchases.
In my experience, HP might be a better choice for a home computer, but it would take a lot to make me choose an HP over Dell in the business world. Good design, good support, fast shipping times... My boss once wanted me to buy PCs for the office with AMD chips (because his son-in-law works in marketing for AMD). HP estimated six weeks to ship the machines while comparable Intel systems from Dell shipped in less than a week.
Maybe with Fiorino gone, things are changing, but HP was once a company I trusted to produce quality hardware. Now, it doesn't matter whether it's printers, PCs, servers or anything else, HP is the LAST company I look to.
One example: I bought an HP multimedia USB keyboard from someone on Ebay. Because it was a keyboard that shipped with a 'consumer' system, and HP only supported Win '98 and XP on their 'consumer' systems, there was no windows 2000 driver support for the features on this keyboard. Later, I upgraded to XP, but HP at that time had no drivers available for download for the keyboard.
Another: windows-only printers and printers that when you try to locate drivers on HPs site, you are told that they are no longer available, for printers that are less than 5 years old.
A few years ago, my opinion was the opposite... Dell servers simply couldn't start to compete with Compaq. They were beefed-up PCs. It's funny, because now the reverse is true. Their servers and office PCs are fantastic machines, but they're playing catch-up in the home, as customizations, see-thru cases, light-up fans, etc, have become more popular. The business world IS saturated, as well as tired of having to upgrade. Now that XP has been around for a while, and nothing new is on the horizon for the near-term, I think businesses are going to operate in maintenance mode until Vista and the next upgrade cycle begins. That's going to hurt Dell more, because they're the largest office PC supplier.
These people looked deep into my soul and assigned me a number based on the order in which I joined.
Any time you create a product out of the least expensive components you can get, you always end up with an inferior product. All the box brands are guilty of this, but not just because they are evil corporations. People are demanding cheaper computers. But most businesses I deal with aren't buying the systems available from Best Buy, WalMart, or any of the other consumer lines. They get business-class models, which are built totally differently than their home-user counterparts. They cost more than the $399 special advertised on TV, but they work better, are easier to fix, and are just a far superior product. Thats my 10 bits :)
Some are surmising that the purchase of Alienware is an attempt to 'get their feet wet' with AMD, aside from picking up revenue from the gaming market. Should be interesting to see how it works out.
For a short time only... Try your tests again after the launch of Conroe - on both server and desktop AMD are in deep shit when Intel's Core stuff is fully rolled out, shortly after July from what I'm reading on the usual sites.