Michael Dell knows a thing or two about technology trends. As a teenager, he saw that personal computers could be built and sold without the overhead of a retail operation, and started PC's Unlimited from his college dorm room. Thirty-six years later, the founder and CEO of Dell Technologies is again looking to the future, this time to 5G.
"It is the most transformative change in our generation," Dell told an online audience at the recent Incompas Show. "It's not about talking on the phone faster; it's about connecting things and making an intelligent world with enormous amounts of data."
Dell Technologies formed a telecom systems business unit this spring, tapping its SVP of corporate strategy, Dennis Hoffman, to run it. Hoffman is eager to expand Dell's relationships with the carriers, which until now have purchased Dell's solutions primarily for data centers and IT departments. "The entire network side of the telco budget, which dwarfs the IT budget, was largely unaddressable," Hoffman said. "But as this world has opened up and disaggregated and virtualized, much of it has started to become very addressable by what we do every day."
What Dell "does every day" is integrate hardware and software and deliver it to corporate customers. This skill set is increasingly important to carriers, Hoffman said, as they try to reduce their reliance on traditional network equipment vendors. He said the CEOs of the world's largest telcos often see the alternative to the traditional vendor model as a chaotic soup of software and hardware coming from dozens of disparate sources. "It's not self-organizing and it puts the carrier in the position of needing to be the systems integrator," he said. "That's something that we do all the time."
Hoffman admits the carrier networks will present new challenges. Dell's forte is integrating servers and software at scale rather than creating the more customized configurations that could be required by network slices and 5G edge computing use cases. But Hoffman sees these as a new opportunity. "I think it creates a services opportunity that runs the gamut of support to deployment, and to some extent even to managing parts of the infrastructure," he said.
The transition of carrier networks to standard hardware is opening doors for Dell, but the company is making it clear from the outset that it will be much more than a hardware vendor. Hoffman said all the new solutions Dell is creating for telco customers will be designed from the beginning as cloud-based services. And while its near-term opportunities will probably be in carrier core networks, the company does not intend to stop there. Michael Dell is a vocal proponent of open RAN, a technology that Hoffman says can play to Dell's strength as an integrator.
"There's actually a very interesting hardware-software integration problem to truly enable open RAN at the right price point," Hoffman said. "What the carriers are clamoring for is somebody to solve the hardware price performance problem of the open radio access network." Hoffman thinks Dell can help in the short term by economically boosting hardware performance, and in the long term by pushing chip vendors to deliver silicon that can support open RAN.
Dell's telco network ambitions extend beyond the core and the RAN. Hoffman knows that carriers foresee the biggest 5G payoff coming from the sale of network-enabled services to enterprise customers. He said Dell has the world's largest IT sales force, and is ready to help.
Interestingly, Dell's Hoffman also advocated for the 12GHz spectrum band to be allocated for 5G. That's noteworthy considering two of the biggest owners of 12GHz spectrum are Dish Network and RS Access, a company backed by Michael Dell's private money management firm. The FCC may rule on the topic as early as December.
Dell currently owns 81% of VMware, a company that Hoffman says started addressing carrier network evolution before Dell did. The Silicon Valley company is telling telcos that true virtualization requires software that runs in multiple clouds so that operators do not inadvertently trade their reliance on single equipment vendors for reliance on specific cloud providers. VMware's hypervisor software is compatible with AWS, Microsoft Azure and IBM Cloud, among others.
Some of the world's biggest telcos, including AT&T, Vodafone and Deutsche Telekom, are already working with VMware. In addition, Dish Network, which has no legacy infrastructure to worry about, plans to build a software-defined 5G network from scratch using the VMware platform in both public and private clouds.
"We're learning a lot," Hoffman said of the Dish deal. "They're trying to pull together this disaggregated 5G ecosystem that's emerging … They've convinced a couple of the classic network equipment providers to unbundle and just deal with software."
VMware is clearly a competitive advantage for Dell as its telco team learns about 5G, but Hoffman says VMware customers aren't compelled to use Dell's hardware. "Michael does not believe in losing one part of a customer relationship over some sort of holy war about another part of the customer's infrastructure," Hoffman said.
For Michael Dell, VMware's work with Dish is obviously about much more than developing a new customer for Dell's servers. "VMware is helping Dish build the nation's first cloud-native 5G network on open RAN technology," Dell said at the Incompas Show. "This is really a game changer for US 5G leadership."
The national stage
According to Michael Dell, the 5G opportunity is about much more than his own company's future. During the Incompas panel, he framed the evolution of 5G as a pivotal development for the US. "The future of our economy, of our communities, also our security, depends on business and government's ability to invest now in the infrastructure for the digital economy," he said. "And 5G … is incredibly important."
Dell sees 5G as a way to extend broadband to more Americans, enable the Internet of Things, and help America reclaim a leadership position in the development of telecom technology. "To be the innovation leader in 5G, the United States has to play to our strengths, specifically in semiconductors, in software, in cloud," Dell said. "A lot of us in the industry have been talking about the open RAN initiative, and 5G is really making this disaggregation of the hardware and software possible and using virtualization technology to bring these technologies back into a place where the US can actually win again in telecom equipment."
Dell is a former member of President Trump's Manufacturing Council, and remained on the council until the president dissolved it in 2017 following a mass exodus of council members based on his handling of protests in Charlottesville, Virginia. Now, with the president at times calling for a national 5G network, Dell is advocating for the public and private sectors to work together. "We need a partnership between governments and industry focused on 5G to drive the technological standards, the supply chain and to address the national economic security issues … quite frankly this technology presents an enormous opportunity for us to get it right," he said.
It also presents an enormous opportunity for Dell, according to Hoffman. "That ecosystem needs a platform company; it needs somebody to anchor it," he said. "As the world's largest diversified computer company, with all the scale we have, given everything else we do, including the world's largest client business, there's a good reason for Dell to have the aspiration to be a big member of that emerging ecosystem." He defines the emerging ecosystem as a network of hardware and software companies working together in an open system.
— Martha DeGrasse, special to Light Reading. Follow her @mardegrasse