Author: Bruce Guptill

On Monday, July 2 2012, Dell Computer announced its planned purchase of Quest Software for $2.4 billion. Quest had been reported in talks with several potential buyers since at least the first quarter of this year.

In its announcement, Dell said that it plans to establish Quest as the core of Dell’s software group, which it expects to grow into a $2 billion-a-year business over the next three years – a planned total revenue growth of about 500 percent based on Dell’s current software business.

From Saugatuck’s point of view, the acquisition is relatively unsurprising, as Dell had been known to be in the bidding for Quest for months, and Quest fills an obvious need for Dell in its accelerating push into the data center.

But we also see this acquisition as being about much more than a need to move from SMB servers and laptops into enterprise software. Should Dell be able to integrate and efficiently manage its string of recent data center management software acquisitions – including Quest along with security management providers AppAssure and SonicWall – Dell will be positioned as a viable provider of core Cloud technology, infrastructure, and management capabilities for user enterprises and for Cloud-based providers of software and business services.

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