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By | Paul Kunert 21st July 2011 10:57

Dell: Force 10 is 'shot in the arm' for networking

US titan plots direct and indirect sales strategy

Dell has described the acquisition of Force 10 Networks as a requisite "shot in the arm" to beef up its networking portfolio for both resellers and direct sales staff.

The Texan titan chalked up yet another acquisition yesterday – due to close in the late summer – as it re-engineers the business from a PC maker to a broader enterprise tech firm. The fee paid for the "private transaction" was not disclosed, said Dell.

Brad Anderson, senior veep of Dell's enterprise solutions group, told analysts in a conference call that the deal would round out the portfolio available to existing Dell and Force 10 dealers.

"We're absolutely going to embrace the channel much like our storage acquisitions," he said. "We see this as a big opportunity to expand and develop a much more robust networking channel within Dell."

Ethernet networking supplier Force 10 turns over around 80 per cent of its $200m sales in North America – the vast majority in the data centre networking segment – but operates in 60 countries worldwide.

It sells to 1,400 customers, transacting half of its revenues directly, and Dell said it did not anticipate a "material change in their organic revenue flow".

Anderson dismissed talk of "conflict" but admitted it also had ambitions to expand sales of networking kit through its direct sales team.

"We have a long history of direct. And it's our principal route to market. And so, we're going to obviously invest heavily to expand the direct market as well," he said.

He said this work of building its networking sales force had already begun – Dell sells Juniper kit – but added: "Force 10 obviously gives us a big shot in the arm. They bring a significant sales capability, both channel and direct."

In the UK, Force 10 Networks sells through distributors Avnet Technology Solutions and Zycko, which recently went through an MBO, but both firms were unavailable to comment. ®

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