Dell buy exposes San reseller route

Dell's $340m acquisition of San company ConvergeNet could herald the creation of reseller links, setting up a channel strategy for the direct vendor's line of storage products.

The deal is Dell's first corporate takeover. ConvergeNet is a developer of products designed to allow servers running any operating system to use any storage resource across a San.

Steve Lewis, head of Dell's storage business in Europe, said Dell had not bought deliverable products, but intellectual property and product development resources. Once it determines which products to release, Dell will look at how to deploy them in the market, he said.

"It's a bit early to say which way we are leaning because we're still examining every option. However, we do have a preferred partner programme to deliver value adds around the Dell product, and expanding this is certainly an option under consideration."

Claus Egge, storage analyst at IDC, said: "Obviously, Sans do not lend themselves to direct sales over the web, but any storage vendor is primarily interested in adding value to their sales to obtain high margins. I wouldn't expect Dell to go wholesale after signing up resellers."

Dell's current storage technology is only capable of connecting Windows or Novell NetWare servers. Michael Lambert, senior vice president of enterprise systems at Dell, said: "We realised we need to broaden that strategy. What this means is our sales force is free to sell our San products into non-Dell markets."

ConvergeNet is due to reveal its product range in October.