lying from the austin convention center in austin texas it's the q @ l world 2014 here are your hosts dave vellante and Stu miniman hi we're back to wrap up 2l world's two minima and I have been here all day will be here tomorrow as well we're starting at eight thirty local time 930 east coast time tomorrow getting started early michael dell will be on tomorrow we'll have the keynotes again only bar broadcasting for a half day but so today's do i want to get your take on this a lot of talk of course initiated by me and others about dallas a private company I think it's a two-edged sword frankly because I think that when things are really good and you got a lot of momentum behind you you've got transparent confirmation or quasi transparent confirmation and that creates a lot of buzz and Busby gets buzzed and acted some good thing some flywheel effects can occur from being public at the same time when things aren't so great and the headlines are bad and the earnings aren't great you can go into this vortex this abyss which dealt was kind of there and I think as you were talking about with Matt Eastwood the timing of del going private couldn't have been better from a valuation standpoint for Michael Dell and Silver Lake I mean I I think they got a fantastic deal even though there's a lot of risk in it that they're taking but the fact that Michael Dell's willing to step up and do that now on 75 percent of the company yes they have debt service what is it 18 billion dollars in debt so i think i think was the number but they'll pay that off over time because of the cash flow machine and they're going to be in a really good position when that happens yeah David's real interesting you know there's been a lot of change Adele there's been there's a lot of new faces here and some of the ones that we knew for many years are gone and you really are having that transformation inside I heard one person kind of overheard in the hallway type thing is you know there were certain antibodies in Dell and you know they're kind of sweeping through making changes and if there's some that aren't on board with where it's going you know well maybe they'll need to take I guess it was the voluntary exit type solution around and but they're hiring aggressively in other spaces because yeah I T is changing and for me the real striking thing dave is they'll talk a lot about choice and we say you know there's so many different markets out there there's you know VMware in their ecosystem that's what Microsoft's doing there's a public cloud and there's all of these little you know sub climates inside IT and devils playing a lot of bets which we talked about is how many bets can you place and actually make enough margin and win at what you're doing so since dell doesn't have to answer to Wall Street they can do what they think is best for the company and really for the customers it kept coming back to you know Michael and all the executive saying we're focused on what the customers are asking us to do we can move really fast we've definitely seen examples of Dell moving faster to deliver some of these solutions that then then they had when they were a public company things like a cloud marketplace things like the new tanukhs OEM you know a lot of interesting technologies here and there's still lots of hardware Dave you know i'm looking through the twitter stream and everybody snapping pictures of the new FX to kind of the next generation vertex it went from vertex really be in that remote office box to the FX to really being a data center you know nice hardware platform that you can build for a more scalable environment so you know interesting stuff happening always a good vibe here in Austin I think that one of the things that's interesting to me in a way when I think I think of I'm reminded of Luger stirs you know can who says elephants can't dance in a way Michael Dell is orchestrating a a different version with clear differences of that playbook and here's what I mean by that he took a company that was 100% essentially PCs and began a multi-billion dollar buying spree and transform this company into what is now the only end-to-end enterprise company now HP used to talk about that as a big deal they've given up on that now that they're going to split up what is the value to a customer in the end one this is supply chain why does the customer care about supply chain because gives you a dell pricing power so Dells got potentially one of the biggest supply chains now in the industry HP had a supply chain that was enormous but now when they split it up I don't know how they're going to continue to leverage that maybe they will maybe they won't that sounds like they won't be able to have that same leverage IBM when it sold its pc division to lenovo lost a lot of leverage gel is now able to sit claim number one in storage terabyte shipped why because it ships so many pcs it's not because of the server business it's because every PC goes out with a half a terabyte disk drive in it so add it up until kicks but all of a sudden boom number one that's interesting but from a customer standpoint you can buy virtually anything from the company now I talked about second elephants dancing you're seeing that transformation being led by a number of factors certainly servers is a big part of that and networking and storage with the big acquisitions that they've made and networking with the acquisitions that they made but also Perot gels got a big services organization that's very sticky and then the other thing which not a lot of people talk about is Dell software in fact I got a tweet earlier from somebody saying del I presume Dave I presume when you talk about Dell having one of everything you're not including software well as we know tells got a almost a two billion dollar software business now that's not ridiculously enormous but it's substantial how many how many multi-billion dollar software companies are out there so what I see is this big portfolio it's not i wouldn't say it's services lead it's not it's it's dell lead but there's a sticky services component with an increasing software component in growth areas like security like systems management like so quick tell calls information management which is a lot of the analytics and big data so jeal can continue if Dell can continue to make those acquisitions do the integrations it's got a pretty good story for customers don't you think yeah absolutely Dave and there's still it's that PC business in that server business that's generating the cash and allowing them to get into a lot of environments and trying out a lot of pieces you know the cloud broker models really interesting because we talked about it a couple of years ago and clouds are not homogeneous and it's not you know until recently moving from one environment to another was going to be difficult enter things like docker and management tools like the Australia saquisili del made are enabling some of these multi cloud environments and so we're seeing customers you know from what we see aren't going all in with one environment you know we've got a survey going on right now and some of the data we've seen so far is that you know it's not like they're saying oh I've got amazon and i'm only doing amazon most customers they're doing amazon they've got VMware inside they might be doing something with a jour because everybody's got office 365 and of course they've got lots of SAS applications so you know where does dell fit into this environment and can they be you know a broker of supplier and arms dealer for a lot of these pieces and you know how do they tie them all together how do they grow those services how do they have their software you said you know there's pieces of software they don't have they don't have you know 200 SAS applications like IBM does they don't have the breath of the amazon marketplace today but you know Dell is in a lot of customer environments especially in that you know kind of sub 5000 user you know marketplace so you know there's a lot of opportunity for Delta add on to that and I said before they can craft a story because they're not a public company that is very positive you know every CEO that is of si of a public company when he or she comes on the earnings call even if they have a Miss even if they have a quarter that they're disappointed in they spin a story and and the street that starts opening up the books and parsing the numbers and doing the analysis and the street either buys it or they don't and so what Dell can do is they can craft any story that they want and make it sound great and and create their own momentum now it sounds like they're growing but you know even today in the keynotes you got a little mix of units and dollars and terabytes and geographies and in different segments and so forth but Michael Dell was able to very effectively put together a story of growth that's been mirrored by his executive management team I'm gonna have no doubt that there's this growth segments but you think about it if IBM we're a private company they could talk about cloud they could talk about their software to find stuff they can talk about you know the security businesses those businesses that are growing and not talk about the business that are shrinking and not talk about the top line that's flatted down or whatever it is so so dell has that advantage in that they can craft a story and and and use that in their marketing to be relevant and I think that's really what customers want to know they want to know that the company I'm doing business with is relevant so they got pcs is the tip of the spear everybody knows dell pc is easy to do business with no problem they've got the services piece that's sticky and they've got everything else in between which is this end end strategy for mid-sized and smaller enterprises which really everybody else kind of pooh-poohed enough poo-poos they all they give it lip service this is this is where del really shines and so I don't know still it's gonna be interesting to see yeah David's interesting i was just ruminating on the fact that you know when you think about the early PC days del just made it so easy to buy first with a catalog and then with a website i could go in and click and choose the environments that i wanted if we look at converged infrastructure and cloud which is where the growth really is you know candle take those same type of experiences and move those to the environments and make you know those choices you know the cloud marketplace reminds me a lot of the dell S&P which was really the offering that I could buy almost anything from dell and dell would take a you know i cut even if it's a small one they didn't necessarily have to support it hugely successful drove a ton of revenue for dell so you know lots of things that they can you know to take advantage of Wow and like I say when wouldn't tell was was public they were a roughly sixty billion dollar company with with trading at fifty to sixty cents on the dollar Michael Delta and silverlake having taken that private the ultimate measure yes customer value etc etc but the real leader board is going to be what if and when tell this hides to have another exit whether that's public offering whatever what the thing to watch is will del have been able to shift its business mix toward the enterprise so that it can even trade let's say it one to one if so it can it could it could create 30 billion dollars of value you know then that Michael the open 75% of saw to me it was just a brilliant move this company is still a cash flow machine you know these big companies that aren't growing that Wall Street seems to hate for some reason even Corey MC these are cash flow machines Oracle cash flow machine IBM HP cash flow machines that if they have good leadership they can transform their businesses into a success story alright well getting kicked out of here still look tomorrow we start at 830am the cube would be live SiliconANGLE TV check out Wikibon org check out SiliconANGLE calm for all the news we'll see you tomorrow this is the cubes two minima and Dave vellante we're out see you tomorrow