Michael Dell, CEO of Dell, told the Citrix Systems Synergy user group last week that virtualization "will sweep through all IT -- servers, storage and networking." As it does so, he touched on how iSCSI will helping establish efficient virtualized servers. That's a Dell specialty and perhaps Dell's contribution to the low end of converged networking and unified computing.Dell gave a second day keynote to the Synergy 2010 Citrix user group at Moscone West without delivering a big headline. But he reaffirmed a basic direction that Dell has undertaken to reposition itself as a supplier of servers highly suitable for virtualization. If virtualization does indeed sweep beyond its present level of server consolidation into the adjoining technologies of the data center, then I believe the enterprise data center will be well on its way toward functioning as a private cloud.

Because the public and private cloud will be built with x86-based servers, Dell is in a position to become a major supplier of servers to the data center, far beyond the level that it is today. For that to happen, however, it will need to offer its own expertise and added value to the basic white box. One way it will do so is through an iSCSI approach to converged networking.

Dell cannot win competing with Cisco Systems, as it produces x86 blades adopting Ethernet over Fibre Channel, moving storage data off the server and into storage arrays at 10 Gb Ethernet speeds. Nor can it win by competing with HP, whose 3Com purchase also gives it a variety of high end ways to produce converged networking coming off of virtualized servers.

The issue is an important one because, as virtual machines stack up on multi-core servers, they will generate a lot of networking and storage traffic. If you can't move the traffic off the server efficiently, your customers are going to look for someone who can. Converged networking relies on Ethernet to carry both kinds of traffic away from the virtual server, through the server I/O hardware--network interface cards or host bus adapters--and into a networking fabric that can separate storage from communications without needing two separate networks.

I think a natural solution for the generic x86 server cluster, the kind already occupying many cloud setups, is iSCSI, with its affinity for the TCP/IP network based on Ethernet, although I still haven't gotten feedback from a marketplace implementation of the architecture. I suspect it will operate at lower speeds than a Cisco solution, but also at a significantly lower price. Dell has supplied servers for the cloud computing being done at Microsoft, Amazon, Ask.com and other search engines. These are customized deals with a powerful buyer that can probably cut Dell's profits to razor thin margins. But in the process Dell has learned much. Now Michael Dell and company are maneuvering to be the chief supplier of the private cloud, at the expense of Cisco, HP and other high end blade suppliers.

Like I said, there was no big headline at Dell's talk before Synergy but there was a subtext of what's going on behind the scenes. Dell is hard at work at making the highly virtualized server an effective unit in the data center. It will be interesting to see if the expertise it's offering has a place in a marketplace rapidly moving toward cloud computing.