Dell has decided to buy EMC, a data storage company, for $67-billion. This acquisition is the third largest in all sectors in this year.
Why is Dell willing to spend such huge amount of money on EMC? This deal can bring a lot of benefits to the Dell in the aspect of the external environment of business.
- Industry Forces
Dell is able to provide customers with more products and service. Many of these products and services combine both functions of PC and data storage, and thus the Dell becomes more competitive in the market.
- Key Trends
The transition of technology becomes faster today. A lot of PC companies such as HP start to focus on developing new tech to improve the function of the products. In order to stand out in the market, it is very important for Dell to purchase EMC and develop a full set of products.
- Market Force
By purchasing EMC, Dell is able to develop more products with various functions. These new products will be the new revenue streams since these products can appeal to customers. Moreover, products with more functions can satisfy the needs of customers. In addition, Dell can have more pricing power by creating a product that other competitors don’t have.
References:
http://www.computerworld.com/article/2991387/cloud-computing/dell-agrees-to-acquire-emc-for-67b.html
http://www.computerworld.com/article/2991765/it-industry/what-the-dell-emc-merger-really-means.html
Image sources:
http://ioceane.com/67b-in-largest-deal-in-tech-history-dell-buys-emc/