Worcester Business Journal

16 Worcester Business Journal | May 29, 2017 | wbjournal.com F O C U S C E N T R A L M A S S . 1 0 0 Dell's first takeover of the EMC World conference indicates a strong role for Central Massachusetts in the company's future BY CRAIG A. RUARK Special to Worcester Business Journal The new EMC L AS VEGAS – Almost eight months to the day after the Dell-EMC marriage became official, more than 13,000 employees, suppliers and cus- tomers from around the globe traveled to this glitzy desert resort setting to see for themselves just how smoothly the part- ners are getting along. The answer, at least from a Central Massachusetts perspective, appears to be Dell EMC is doing quite nicely, thank you. Fears of deep cuts as the company shakes out redundancies seem unfounded. In fact, the talk in the corridors of the Sands Expo Center and the Palazzo hotel suggests even better days may be ahead for Central Massachusetts' largest manufacturer. While EMC continues to do what it does best in Massachusetts, Dell continues to do what it does best in its Texas facilities. However, after the acquisition, Dell's server, networks and small storage business moved from Texas to the Massachusetts facilities, thereby increasing the amount of revenue man- aged out of Hopkinton, from $24.7 bil- lion to approximately $30 billion a year. When the data is tallied for 2017, that may be enough to nudge past TJ Maxx for third spot among publicly traded Bay State-based companies. Only Liberty Mutual Insurance at $39.45 bil- lion, Massachusetts Mutual Life Insurance at $38.24 billion, have more based on 2015 numbers. "One of the beauties of this merger is that the portfolio of the two companies are extremely complementary in their product alignment with almost no over- lap," said Dave Farmer, vice president of public relations for Dell EMC. "We have combined Dell's strength in PCs and servers for small and midsize business customers with EMC's strength in stor- age, converged infrastructure, security and virtualization for large enterprises." Farmer's promotion to vice president is a positive indication of EMC's role in the emerging integration of the tech giants. Farmer joined EMC in 1995 and was senior director, public relations at EMC prior to taking over the larger role with Dell EMC last fall. Another positive sign came in the announcement May 8 that Dell and EMC had consolidated their cor- porate investment arms into a new entity – Dell Technologies Capital. Scott Darling, former president of EMC Ventures, will head the operation positioned to spend about $100 million a year. While Darling is based in Palo Alto, EMC execu- tives Matt Olton and Gregg Adkin are in the team's Boston office. Creating a new future The show kicked off with Dell Founder & CEO Michael Dell's opening keynote detailing the evolution he sees for business from the public cloud to hybrid cloud to private cloud, all of course driven by Dell EMC. Dell's excitement included for the new OpenManage Enterprise Console, part of the 14th generation of the PowerEdge Server line. It combines Dell server and EMC storage technologies in one user interface and is a big step down the road to Dell owning the data pipeline from end to end. Bumps in the road are bound to come up, as with any high-profile acquisition, but those bumps were well hidden during the 2017 version of Dell EMC World Annual Conference. O ne of the recurring intrigues sur- rounding the Dell-EMC deal revolves around the fate of VMware. VMware, the virtualization software tool that powers the cloud by making it possible for multiple operating systems and functions to run on the same virtual- ized computer, was widely viewed as the crown jewel of Dell's acquisition of EMC last year. While VMware is based in Palo Alto, Calif., it has major operations in Cambridge and Burlington. Questions were asked whether Dell could manage the debt it took on in acquiring EMC. Initial reports set the price at $67 billion, but Dell now says it was just over $58 billion. Either way, a good portion of the funding was borrowed. Selling off VMware – at its current market cap of about $34 billion – would certainly change the math, but so too would losing VMware's future potential contributions. VMware still functions as its own pub- licly traded company, as it did under EMC, but it is now majority-owned by Dell Technologies. And unlike other parts of Dell's new empire, VMware is growing at 10 percent a year. No cards were shown at the Las Vegas conference. Or were they? From the stage, announcements included integration of VMware's Air Watch and the Dell Client Command Suite; a new Dell EMC VDI holistic desktop virtualization system is pow- ered by VMware Horizon; and there's the VMware NSX network virtualization and security platform with the Pivotal Cloud Foundry platform. Any future buyer of VMware would be deeply involved as a Dell EMC client. And then there were the two deals – one announced just before the event and one just after – involving VMware buying startups, clearly signaling it plans to keep accelerating its growth. Dell further ties itself to VMare CM100 2017 rank: 2 2016 rank (as EMC Corp.): 2 2017 local employees: 9,000 2016 local employees: 9,000 2017 revenue: $72B 2016 revenue: $24B The event traces its roots to 2001 as the EMC Enterprise Wizards Conference with just under 1,000 attendees and that evolved to become EMC World. In 2017, DEW's growth to 13,000 is a confirmation of just how much the company has matured. "I am proud of everything we've built at EMC – from humble beginnings as a Boston-based startup to a global, world-class technology company with an unyielding dedication to our cus- tomers," said Joe Tucci, former chair- man and CEO of EMC when the merg- er was set to close in September. "The combination of Dell and EMC creates a new powerhouse in the industry – pro- viding the essential technology for the next era in IT." And Central Massachusetts appears to have a solid role in shaping that future. Dell EMC President David Goulden spoke about the integration of the two companies in front of the crowd in Las Vegas. W P H O T O S / C O U R T E S Y W

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