Dell's EqualLogic buy creates competition for EMC storage resellers

The Dell brand name has made the EqualLogic line stronger in the eyes of customers, according to EMC partners.

EMC storage resellers say Dell's acquisition of EqualLogic has sparked more competition for them but also created a rift in the two vendors' original equipment manufacturer (OEM) deal.

The Dell acquisition of EqualLogic, a Nashua, N.H.-based storage vendor, closed earlier this year. The move boosted the EqualLogic products' standing in the eyes of potential customers, said Jamie Shepard, vice president of technology solutions for International Computerware, an EMC storage reseller in Marlborough, Mass.

"Before, you could say, 'Guys, are you going to buy from EMC or from some small company up in New Hampshire?'" Shepard said. "You can't do that anymore."

Mike Willard, co-founder and principal of Dallas-based EMC storage reseller Soccour Solutions, agreed that the Dell brand name and sales push is helping the EqualLogic line.

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"Dell is in there and talking very passionately about their EqualLogic offering, and in a lot of circumstances it is in direct competition with what EMC is offering," he said.

The new competition has made it harder for EMC storage resellers to do business, but neither Shepard nor Willard said they are losing sales to Dell/EqualLogic. EMC's major selling points are its Fibre Channel and network-attached storage (NAS) technologies, ease of use and new integration with VMware products, they said. (EMC is VMware's parent company.)

Dell began selling EMC drives through an OEM deal struck last year. That led to fears of channel conflict among EMC storage resellers, because Dell was able to offer lower prices than they could.

But since Dell's acquisition of EqualLogic, Dell has focused on selling its own products over EMC's, Shepard said. EMC users who originally bought from Dell are now turning to him and other EMC storage resellers, and that's actually helping their sales.

"Our business has increased quite a bit," he said. "It's those Dell accounts."

Dell launched its first formal partner program in December, and some experts saw the acquisition of EqualLogic as a move to help build the Dell channel. Value-added resellers (VARs) know more about technology, which is helping the EqualLogic products compete with EMC, Willard said.

"The Dell salespeople have little technical expertise," he said. "They basically sell on one thing, and that's price."

Dell's acquisition of EqualLogic makes business more complicated and frustrating for EMC storage resellers, but the idea of competing with Dell should be "business as usual," said Paul Myerson, senior channel analyst for Enterprise Strategy Group in Milford, Mass. Meanwhile, it remains to be seen whether Dell can continue with its history of direct sales and grow its channel at the same time.

"It's an art form," Myerson said. "To try and blend a channel program into a direct sales model can be war internally."

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