Dell Targets SMBs With Simpler, Cheaper Storage Option

The solution, known as the "MD3000i," will be easier to use and less expensive to set up and maintain than solutions from rivals because it is specifically designed for smaller firms, Dell said.

Calling storage the "next linchpin" in a larger strategy of simplifying information technology, CEO Michael Dell said the product fills a gap between enterprise-level solutions and "rudimentary" options not sufficient for the data storage demands of today's businesses.

Seeking Smaller Customers

"Growing businesses are quickly reaching a breaking point in their ability to store and manage all the data being created," Dell said as he unveiled the product. Saying current choices are for businesses to overspend to get high-quality performance or accept solutions that don't do enough, he added, "We will change that. We are committed to simplifying IT for our customers and changing the economics of storage."

The MD3000i is a storage area network array, or SAN, with features that Dell claims have previously been available only on far more expensive products. The product will cost around US$13,000 and be able to store 18 terabytes of data.

It is the fourth storage solution Dell has rolled out this year as it seeks to tap into the fast-growing market for helping businesses of all sizes handle a mounting deluge of data.

Following Up Vostro

For Dell, the storage gambit is a key follow-up to its launch in July of the Vostro brand of technology solutions aimed at those same small business customers, who are becoming increasingly voracious consumers of PCs, servers and related products and services .

To date, Vostro has been seen getting off to a slow start, but Dell may be starting to round out a strategy that should eventually be expanded to include more services and other products aimed at small businesses, said Gartner (NYSE: IT) analyst Leslie Fiering.

Dell launched the initiative with a line of PCs stripped of the freeware and other features that often come with consumer PCs, which many small businesses buy, Fiering noted.

"To be a significant initiative, Vostro needs to grow into more of a total solution for small businesses," Fiering told the E-Commerce Times. "Small businesses do struggle with finding the right technology solutions and often feel they fall through the cracks between enterprises and consumers."

Massive Opportunity

Dell cited data from IDC showing that fewer than 20 percent of small businesses and about a third of medium-sized companies have SANs in place while 41 percent of those same businesses plan to invest in expanding their data storage capacity in the coming year. Some more complex solutions for handling data storage may be out of reach for businesses without dedicated IT staff, Dell said.

Unlike rival offerings from HP (NYSE: HPQ) and IBM (NYSE: IBM) that require knowledge of Fibre Channel architecture, Dell said its storage array would not require any specialized IT skills to set up and would feature built-in configuration and management software that can support real-time or scheduled data backups. The solution supports both Windows and Linux operating systems and uses the same drives and interface configurations as the PowerEdge server line.

The launch underscores the dual strategy Michael Dell plans to employ to restore his namesake company to prominence in the technology solutions space. To reach more consumers, Dell is embracing a retail strategy for the first time in its history. "What we're starting to see emerge is a bit of a different focus," he said Monday. "We're pointing the company into new areas and making a number of longer-term investments."

The business-facing strategy may be even more important, given its sheer size, which has made it a favorite target of many vendors, including IBM, HP and Cisco (Nasdaq: CSCO) , said Forrester Research analyst Michael Speyer

"The sheer size of the small business segment makes it very attractive to IT vendors," Speyer told the E-Commerce Times.

The market is actually multiple segments, however, including very small businesses that have their own unique IT needs. "These customers are likely to respond favorably to services and solutions that address their specific problems and pain points."