Dell Unveils Net-Focused Hardware, Services

SAN FRANCISCO (04/06/2000) - Dell Computer Corp. announced a further shift in market priorities yesterday toward Internet hardware and services.

The computer manufacturer unveiled five initiatives, including new PowerApp servers for Internet infrastructure tasks such as Web serving, caching and load balancing. Prices start at $1,899.

Dell also said it will offer consulting services for businesses setting up Internet sites, teaming with Arthur Andersen and Gen 3 Partners.

Dell will also offer direct services for Internet service providers and has set up an initiative for Internet access services and products, including wireless and high-speed Internet access.

Yet another initiative, Dell Ventures, will provide equity investments for start-up companies with innovative technologies and products.

Dell is hoping to leverage its expertise as an online merchant of computers, Dell officials said. Nearly half of its $25 billion in annual revenue last year was generated online.

"We are combing Dell's Internet expertise and our unique ability to organize resources around distinct customer needs to create new Web-related capabilities," Dell Chairman Michael Dell said in a statement.

Last August, Dell announced a major push toward more profitable servers and then announced in the fourth quarter that its PowerEdge servers accounted for 40% of the growth in the server market.

Earlier this year, Dell touted its move from No. 2 to No. 1 seller of desktop PCs in the U.S. But yesterday's focus seemed to be a shift away from that market as PC prices drop. Fast-processor machines from leading manufacturers are now selling for around $500.

However, a Dell spokesman denied that the bolstered focus on Internet products and services was a retrenchment from the PC business. "We're not walking away from our PC business at all," said spokesman David Frink.

Frink said Dell will sell products and services for the Internet infrastructure but also devices that function at the edge of the Internet, including desktop PCs, handheld devices and workstations.

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