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Dell's Data Center Unit Racking Up Cloud Sales

Dell has quietly engineered 30-40 cloud server designs for major Internet companies, and those designs will eventually affect the enterprise market.

Over the past two years Dell has become a server supplier to search engine providers Yahoo, Microsoft's Bing and and other cloud suppliers, such as Amazon Web Services, as these companies built out their data centers on the Internet.

Dell's Data Center Solutions unit, has only 20 customers, but would be the third largest supplier of x86 servers in the U.S. if it were split out from Dell, said Forrest Norrod, the unit's VP and general manager, in an interview. The only companies ahead it in shipping Intel or AMD servers would be HP and Dell itself.

When the unit was established in mid-2006, those 20 customers represented 5% of the x86 server market. Today, they consume more than 10% of x86 servers produced, Norrod said at Dell headquarters in Round Rock, Texas, Tuesday. Those customers enlist suppliers in addition to Dell, but Dell has experience in producing 30-40 types of servers that have been used to build out the massively scaled, "cloud" data centers.

Norrod hesitated to say Dell was the leading supplier of servers to" the cloud" and seemed to approach "the highly overloaded term cloud computing" with measured caution. Nevertheless, he said, Dell sees a new form of computing that's "hit the inflection point where early adopters are past the experimental phase of kicking the tires and are moving non-critical workloads into the cloud." Rackspace Cloud, AT&T's Synaptic Compute cloud or Amazon's Elastic Compute Cloud are all potential cloud service suppliers to run such workloads.

In Norrod's opinion, the action won't stop there. "The private cloud could proliferate as well," he predicted. When an enterprise starts to recast its data center on the pattern of the public cloud, that's sometimes called a "private cloud" and features clusters of virtualized x86 servers, managed through a virtualization management console.

Asked to further define private cloud, Norrod said in jest, "It's a magic panacea that solves all problems." Even those interested in the cloud-style of computing "don't see a wholesale migration to the cloud," whether public or private, he said. But he added that there was a clear interest in running Windows or Linux applications, "whose data can't be exported to the public cloud for reasons of security or compliance, inside the enterprise in a private cloud."

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