Dell strikes gold by acquiring Alienware

This week's spike in my job-satisfaction index is sponsored by that least likely of catalysts, Dell Computer. Dell's acquisition of the low-volume, high-end PC maker Alienware is so strategically brilliant that I may have to find a new exemplar for the lack of vision and innovation that typifies the PC market (any suggestions?).

I don't own any Alienware gear, but it's tops on a very short list of manufacturers that build the kinds of client systems I build for myself when it's time to catch up on AMD's latest CPUs. In the present landscape, it's iMac, it's a 64-bit AMD64 or PowerPC monster, or it's outta here. Alienware makes accessible monsters for people who won't accept less, and Dell gets a gold medal for snatching the company up.

Why care about this thinnest slice of the pie -- the hard-core developers, the gamers, the zero-day technologists whose vocation or avocation is leading-edge computing technology? Because we move the market by refusing to accept inertia. We shoved Intel off its market-blind road map, kicked off the x86 performance and component price wars, made ATA and Serial ATA storage respectable, snuffed Intel's attempt to foist costly and proprietary RAM on customers (watch out -- they're at it again) and drove 64-bit, multiprocessing, and then multicore CPUs into client systems.

I occupy an obscure slice of that obscure slice by looking at killer workstations and gaming PCs and saying, "PC OSes and apps will blow my readers' minds when these boxes represent the PC client baseline."

All of my visions seem outlandish when cast in the present tense, but there is a precedent for this particular madness. Whether or not the Mac's for you, you know that OS X Tiger and Mac applications are hot. The reason is that Apple set and rapidly advanced a hardware platform baseline that strikes PC users as overkill. When an influential vendor's technology overkill gains traction, users' expectations rise and a self-propelling flywheel of innovation driven by revenue is set in motion.

Apple is the quintessential anti-Dell, but Alienware has always been a leader in the secondary squad. But that's where any speculation about Dell pushing the button on Apple should end. Dell and Alienware aren't writing their own OSes or applications. They don't have a chain of company-owned stores where customers happily pay list price and endure the constant companionship of loss prevention staff. Dell and Alienware don't have magazines, trade shows, blogs, journalists, and Web sites on their reins.

Putting aside the Dell/Apple angle, it's important to recognize that Alienware now has access to Dell's bankroll, logistics, and its cost-plus-a-dime supply chain. Dell has a bet-hedging relationship with AMD covered by the plausible separation of a subsidiary. It's an incredibly smart arrangement, even if all Dell does with Alienware is support and learn from it.

Is all of this life-changing? Likely not. It's a move in an accelerating game of high-stakes chess. If this acquisition is purely a short-term strategy, then Dell is reminding Intel that being Dell's most favored CPU supplier requires that Intel maintain Dell's status as Intel's most favored OEM. It is Dell's way of raising the Swiss flag in AMD v. Intel and requesting a cease-fire from the nasty old media. And if Alienware can keep Dell's petrifying hand out of the building, it's a great time to be working for or buying from the company.

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Tom Yager

InfoWorld
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