Dell Founder Dropped $100M Onto Red Hat 298
diegocgteleline.es writes "Via google news, I found a article at MSNBC claiming that Michael Dell, Dell's founder and chairman, has droped $100M into Red Hat (Michael himself, not his company). Analyists say that "Dell - neither the person nor the company - is interested in acquiring Red Hat", but one wonders what's behind of this move. A fight against their competence in the server market?"
Dell UNIX (Score:5, Interesting)
Re:Dell UNIX (Score:3, Insightful)
That would have been around 1990.
Re:Dell UNIX (Score:2, Interesting)
Re:Dell UNIX (Score:3, Informative)
But nextOS was ported to x86 when it was dieng a year before Apple bought it in order to convert it to MacOSX.
More like sending a message to Microsoft (Score:4, Insightful)
Once upon a time, Dell had their own SVR4 UNIX Distro. Perhaps Mr Dell has a passion for OS's.
I wouldn't be supprised if this was more to do with Microsoft, to send them a message that they don't have the world over a barrel, than it is a passion of OS's. As computers get cheaper, every machine sold with Windows on it is going to be cutting into an increasing amount of profit margin, and just as the industry is getting cheaper - Microsoft is getting more expensive, perhaps this is more like the corporate way of saying f**k U, without putting anything on "Dell" - the company.
Comment removed (Score:4, Funny)
Re:Goodness in his heart (Score:4, Insightful)
Re:Goodness in his heart (Score:3, Funny)
Same difference.
KFG
Re:Goodness in his heart (Score:3, Funny)
Ok (Score:5, Funny)
Aha
Duh!!! (Score:5, Funny)
Maybe... (Score:2, Funny)
Re:Maybe... (Score:3, Interesting)
Self-fulfilling prophecy?
Re:Maybe... (Score:3, Interesting)
RHAT is a very volatile stock, big price swings. 29 was at the high end of one of those speculative swings. Its sort of idling in the middle right now. It could go to 5 or 30 in the short term, it all depends on the new and what the speculators think, but in the longer term (say a couple of years) it will probably hit the mid to high 20s again.
Re:Maybe... (Score:3, Informative)
Re:Maybe... (Score:3, Informative)
In a filing with regulators April 27, Red Hat said MSD Capital's $99.5 million worth of debentures would be converted into 3.89 million shares of the Raleigh-based company
Re:It was $301 . . . (Score:2)
Look at it as a relatively inexpensive lesson in "get rich quick" and/or IPO speculation. I waited until after it came crashing down, I didn't realize how far it would go but I did realize triple digit was insane.
linguistic note (Score:5, Informative)
In Spanish, competencia means both, hence this is an easy error for native Spanish speakers to make in English.
Re:linguistic note (Score:5, Funny)
Droping? (Score:2)
But to have $100M problem like this must be bad no?
Re:linguistic note (Score:2)
Re:linguistic note (Score:2, Informative)
Maybe Dell doesn't want to be locked into MS forever on his server line.
We've bought quite a few Dell servers - with Red Hat Advanced Server installed.
Re:linguistic note (Score:2)
Correct analyst quote (Score:4, Informative)
Sigh. Editors.
Re:Thank you! (Score:2)
motivations. (Score:5, Insightful)
but one wonders what's behind of this move.
With a 100 million investment by an individual (and not a corporation) you can bet that Michael Dell thinks this is a good investment. That kind of money isn't chump change, so he must think it's a good risk.
Re:motivations. (Score:4, Informative)
When you have the kind of money he does, the correct phrase is "good enough risk." It probably just means that he thinks the probability of it going up, times the amount it would go up, makes it a worthwhile investment in comparison to the probability of the investment vaporizing.
And he's probably right. If I had a spare $100 million sitting around, I might do the same.
Re:motivations. (Score:5, Funny)
Invest in me!
Give me only one million of your chump change and my gratitude will haunt you forever. And I'll write tons of screaming testimonials for any product that you may be selling. With pics.
Re:motivations. (Score:2)
> that you may be selling. With pics.
Hmm... I've been looking for a shill for my self-castration kit..
Re:motivations. (Score:4, Insightful)
Easy peasy.
Dell's getting it's ass kicked by Opteron servers from the likes of Sun running Solaris and Linux.
Dell is Microsoft's and intel's bitch. Dell only sells machines with intel processors to get a good price from intel. That's why they can sell their machines so cheap.
Dell's contract with Microsoft forbids them from selling any quantity of machines without an OS (to prevent "piracy") or with Linux at a lower price than Windows. Try it, I did when I was buying servers for Sun. Despite the fact that we were going to be buying machines to develop and run Solaris x86, they said we either had to buy Windows or Linux (to preven "piracy"). I ended up buying Windows, because "Linux is more expensive" according to the Dell sales droids. Go figure.
Everyone except Dell is selling Opteron servers, which are cheaper, faster and cooler than intel servers. Dell does not have an OS. Sun will sell you Linux or Solaris x86. HP will sell you Linux, Windoze or Solaris x86 (I jest not). IBM will sell you Linux or Windoze. Dell is bound to M$ as mentioned above.
Michael Dell ain't stupid. He's covering his posterior, like all good business people do who want to still be in business in 5 years time.
Re:motivations. (Score:2)
and then you sit there, looking at it impotently. or were you actually thinking you were going to shoot an activist?
Reflex action. Doesn't everyone have an activist they'd like to shoot? Around here it's probbably the SCO activists.
Re:motivations. (Score:2)
I have larger percentages invested in single companies in my portfolio and I mostly invest in Mutual funds.
Sure, it's not a huge percentage of Dells wealth, most of his wealth is of course tied up in Dell. It's likely a much higher percentage of his more liquid wealth though. It's also not quite fair to compare percentages of your, and Dells investments, since you (presumably) don't own a good chunk of a major corporation you founded.
Making sure you have multiple suppliers is smart. (Score:4, Interesting)
He's also tweaking MSFT. MSFT could come back with lower prices (of course, they could come back with higher prices). Dell has enough muscle to pay the higher Microsoft price if asked to.
Re:Making sure you have multiple suppliers is smar (Score:3, Funny)
That you, AMD?
Re:Making sure you have multiple suppliers is smar (Score:4, Insightful)
Would Michael Dell suggesting to Dell the company that they should start using RH more, be a conflict of interests for the other investors? He has a vested interest in both companies. What if he bought a decent size of AMD stock and then within the next few months Dell the company decides to start using AMD chips? Maybe there is no oversight for transactions like that but it sure as hell seems that there should be.
Re:Making sure you have multiple suppliers is smar (Score:3, Informative)
Michael Dell is not a commodity manager for Dell, Inc.
Obviously he has input into the strategy for the company, but I don't think he single-handedly negotiates deals with suppliers.
Michael Dell only needs a single source for the OS on his personal computer. What Dell,Inc puts on their computers is unrelated to this story.
I don't know how much "muscle" Michael Dell has, but I'm sure he has enough "money" to afford the higher cost of a single personal copy of Micros
Re:Making sure you have multiple suppliers is smar (Score:4, Insightful)
There's something to be said for investing in something which is the polar opposite of what your employer (or in Michael Dell's case, company) is doing. In very simplistic terms, it's reasonable to assume that if Linux usage does increase significantly, it'll be at the cost of Microsoft.
This could bite Dell (the company) pretty hard given their close ties with Microsoft. However, as far as Michael Dell is concerned, he's hedging his bets. If Microsoft remains strong, his company wins. If Microsoft loses significantly to Linux (and he can't turn his company into a Linux-lovin' company rather than Just Another Microsoft Box-Shifter pretty quickly), he's still covered.
Re:Making sure you have multiple suppliers is smar (Score:4, Insightful)
While I've never worked for Dell, contractor or otherwise, it's no secret that there are quite a few employees that like Red Hat and have been pushing it to the execs for quite some time. This is what lead the company to include it in their server products in the first place.
The timing of the investment is interesting because Red Hat has beaten street estimates due to a rise in subscriptions (found in this [com.com] CNET article.) This must have the Red Hat development team jumping for joy. Dell's involvement will only drive them to introduce innovative technologies to both RHEL and Red Hat Desktop.
What I believe will happen in the not too distant future is that Dell (the company) will:
* Ante up and start promoting Red Hat based servers more than they have done in the past. While it may piss off MS, they'll respond, albeit gently, it's just business and keep going.
* Create a sales bundle for small to medium businesses that will include an RHEL server and x amount of desktops loaded with Red Hat Desktop. All this with a migration team waiting in the wings to help the company through the initial learning curve.
* Similar sales bundle for larger corporations, including clustering services and SAN related products.
and finally...
* Further collaborate with Red Hat to offer special pricing on multi-tiered support packages for Dell customers switching from Windows based systems. Since Dell already offers Linux training services and the like, it would basically be a strengthening of its partnership.
Only time will tell! We'll revisit the issue in a few months as I'm sure it will garner more attention when Dell (the company) makes a move.
Linux acceptance helps Dell more than Compaq (Score:2)
If that's (still) true, increasing acceptance of Linux in the marketplace gives Dell an increased competitive advantage over Compaq.
(Then again, maybe Dell is just being a nice guy. B-) )
He can afford it (Score:5, Insightful)
If I had Dell's capital I might invest a few bucks in an up-and-coming tech stock like RH. It might prove very useful given that Dell have some interest in the cheepo server market.
I'm not saying this points to some massive change in direction, just a little future proofing, and if it all goes wrong he can afford it.
Re:He can afford it (Score:2)
up-and-coming [yahoo.com] ? It was up and coming a decade ago. Now its more of a came-went-recovered-still-going tech stock isn't it?
10 Billion in investments... (Score:2, Interesting)
They're not going to discuss his reasoning but it likely says alot of red hat's market capitalization, nothing more.
"Jedi Business, go back to your drinks"
Quoting Episode II in your .sig? (Score:3, Funny)
Sorry
BFD (Score:5, Informative)
Even then, Dell might make money on the deal: .
Re:BFD (Score:3)
Yeah, BFD again. Who wants to own a bankrupt company with no IP?
-a
Re:BFD (Score:2, Interesting)
Re:BFD (Score:2)
GTRacer
- Pizza Pizza (I miss that place)
Re:BFD (Score:2)
That's one of the primary reasons why Romans sucked at math. The other biggie would be the lack of zero. A Roman mathematian parsing M-M would SIGSEGV.
Re:BFD (Score:2)
Nothing funny here (Score:5, Informative)
speculation of Michael dell actually buying RedHat is, on this information, totally unfounded.
Re:Nothing funny here (Score:2)
Which is why the article and the summary both said so. -1, Redundant. Though the rest of your post may have been interesting to someone.
Proofread, damn it! (Score:2, Informative)
Umm... actually that's not what they say. RTFA! Analysts do not see this as a sign that Dell is interested in acquiring RedHat.
By the way... Analysists? droped? Spellcheck!
Re:Proofread, damn it! (Score:3, Informative)
Re:Proofread, damn it! (Score:5, Interesting)
If a sentence is properly constructed, you should be able to remove the modifier to get the meaning of this statement. "Neither the person nor the company" is just a modifier of "Dell" to specify which "Dell" they're talking about. Remove it for the sentence's meaning:
"Dell is interested in acquiring Red Hat"
However, they use a negative "Neither/nor" construction in an inclusive modifier, which really confuses things. If they really mean "not" they should start with a negative sentence:
"Dell is NOT interested in acquiring Red Hat"
and then modify it with an inclusive modifier:
"Dell, EITHER the person OR the company, is not interested in acquiring Red Hat."
Or they could be more specific and retain the neither/nor construction:
"Neither Dell corporation nor Michael Dell is interested in acquiring Red Hat."
Grammar slackers often make fun of grammar nitpickers, saying "they know what I mean." Well, not in this case. Taken as written, this sentence means the exact opposite of what was probably intended. Grammar conveys specific meaning, and people who do not know or care to follow the rules of grammar risk misunderstanding.
This story is a great example of the fact that the slashdot editors seem to fall into at least one of those categories.
Re:Proofread, damn it! (Score:2)
funny, you seemed to know what he meant despite his incorrect grammar.
Re:Proofread, damn it! (Score:2)
Man, you people... (Score:4, Insightful)
I underestimated you guys! I'd have thought that this move, which seems to be his investment group making an arbitrage play, would be overspun as a ringing endorsement of Red Hat by Dell, and Michael Dell. Instead we get "It's a plot!!! A plot to destroy Lunix!!!!"
I also like the way the submitter managed to completely invert the statement about how analysts _do_ _not_ believe this is takeover attempt.
Re:Man, you people... (Score:2)
I never said Dell is buying Redhat
Dell is fighting in hardware sales against sun/ibm/hp. Linux is growing faster than any other operative system out there. Red Hat is the most succesful linux distro in enterprise. Dell wants to sell lots of computers. See a trend?
So, I wouldn't say that investing in redhat is going to hurt dell. My guess is that Mr. Dell is inte
Re:Man, you people... (Score:2)
That said, I still doubt this news has anything to do with Dell Inc., and probably has very little to do with Michael Dell.
Re:Man, you people... (Score:2)
Actually, "It's a trap!" A trap to destroy Linux.
Oh, shit, sorry, wrong website.
Maybe Dell's Covering Himself... (Score:3, Insightful)
Michael Dell has always been a forward thinker (as evidenced by his innovation in sales techniques online) and I would imagine that he sees the potential in Linux. I wouldn't be surprised if his half-hearted attempts to sell Linux desktops were only half-hearted due to MS pressure and threats. MS has Dell and the other OEMs over a barrel. Dell may want his freedom, and Red Hat may be the "get out of MS Jail free" card he needs.
I believe Linux actually is truly desktop ready -- and this is coming from a former Mac guy who relishes his ease-of-use more than anything. If I can use Ubuntu daily, anyone can. And I'm sure Dell has seen Linux's progress as well as anybody else here and is betting on it continuing. He's getting in on the "ground floor", so to speak.
Re:Maybe Dell's Covering Himself... (Score:3, Interesting)
GNOME and KDE are to a point where they are basically on par with Windows, in terms of usability. More ISVs need to recognize this and go back to supporting UNIX (and Linux). It's interesting how what's old can become new again.
I imagine Microsoft is like a water baloon being squeezed from below by Linux and from above by Apple and with Solaris sticking needles into the sides. How long until it pops?
Re:Maybe Dell's Covering Himself... (Score:2)
questions linux > windows converts would ask (if things were reversed:
what the hell is c:? a:? d:? (many linux distro's now put a link on kde desktops for any removable media mounted)
where is my home directory? wft is c:\documents and settings?
why cant i use the default media player on anything less than a duel core athlon 64 4800+?
how do i install s
"Neither the person nor the company"? (Score:3, Funny)
So, it wasn't Michael Dell, then. Nor was it Dell, the famed computer vendor. That only leaves Del Boy from 'Only Fools and Horses'. Heh, those crazy Cockneys and their money-making schemes! I bet they mess it up and wind up penniless again!
Re:"Neither the person nor the company"? (Score:2)
Run away!
Spending pocket money (Score:3, Informative)
Money in free software (Score:4, Interesting)
Dell is putting some cash on the obvious Linux market leader. Personally, I'd put my $100m on Novell.
Oh, and where "is" the money in free software? That's the lovely part. It's not in the software at all, but in the explosion of valuable products and services that it enables. We're only at the start of this process, it's barely visible.
Tomorrows headline: (Score:5, Funny)
Friday's headline:
Michael Dell sells shares in Red Hat for big profit.
in prison showers... (Score:2)
elegant floral bouquet and hollandaise sauce... not appropriate for all occasions.
she's vicious.
"Michael Dell sinks $100M into Red Hat" (Score:4, Informative)
My $12K in Novell stock is different. It represents faith in the company as opposed to faith in the company being able to pay me back.
Then again, Michael may be playing off Redhat against Microsoft to get bettr pricing, just like he does with AMD&Intel which could well result in the loan paying off many times over for his company, which he owns a lot of, in short order.
Nowthat Senor dillitante investor has spoken, let's here from some folks who know what they're talking about
Re:"Michael Dell sinks $100M into Red Hat" (Score:4, Informative)
It mentions in the article that Dell's stock after the conversion is only worth about 45 mil as Redhat's stock has tanked over the last year.
Re:"Michael Dell sinks $100M into Red Hat" (Score:2)
How did RedHat get $600 mil in debt? Last I checked, they had almost $300 mil of cash in the bank and a negligible run rate.
-a
Re:"Michael Dell sinks $100M into Red Hat" (Score:2)
Re:"Michael Dell sinks $100M into Red Hat" (Score:2)
Novell impressed me when they bought SuSE. But what have they done with it since?
Sounds kind of heavy (Score:5, Funny)
Imagine if they were Sacagaweas. Those poor Linux geeks wouldn't stand a chance with dollar coins raining down on their heads.
Red Hat wants Money+Channels (Score:2)
If RH is going to get anywhere on the desktop (their "next move" for the last 18 months), then they will need Dell Computer, and MSD still has some sway
Look out below! (Score:3, Funny)
Re:Look out below! (Score:2)
$100M = 114,341 platinum ounces = 3,556kg
I did some rough calculations on this topic a while back - for Sterling mind. $100M = £53.1M. My guesses were that this is what 20kg of notes would get you:
£50 - 15686 notes (£784,300)
£20 - 17105 notes (£342,100)
£10 - 19033 notes (£190,330)
£5 - 21,164 notes (£105,820)
So:
£53.1M in £50 notes would weigh 1,354kg
£53.1M in £20 notes would weigh 3,104kg
Re:Look out below! (Score:2)
100 mil is 100 mil! (Score:2, Insightful)
MS & Apple (Score:2, Insightful)
Disappointing, really (Score:3, Insightful)
With all of the class action lawsuits going around these days I would doubt that Dell would want to risk any scrutiny for a "simple" investment. This leads me to believe that Dell has no intentions of significantly altering their current state in relation to Redhat, pre-installed linux, new offerings, etc.
Hedging your bets (Score:2)
Dell is also sending a message to Microsoft: Just because we haven't embraced Linux at this juncture doesn't mean we won't in the future. It's a good way of letting MS know that he's not in their pocket.
Move: Double or triple your money (Score:2)
How about doubling or tripling that $100M? RHAT is a volative stock that has some pretty big swings. If you time your purchase right sometime over the next couple of years you may be able to realize a pretty big gain. Linux is becoming more important (fwiw I'm not referring to the desktop) and Red Hat is well poised to benefit from that. I think it is a good medium term investment.
Also to assume some sort of conspiracy is ignorant. Dell is a business.
He isn't buying stock (Score:3, Informative)
Big dreams mean big wins (Score:5, Interesting)
Michael Dell has been a capitalist his whole life, from selling newspaper subscriptions to selling PCs out of his dorm room. He's always been a risk-taker and an achiever. I'm not really impressed with him as a deep thinker, from the few interviews and articles I've seen him do, but that's not his area.
His goal was becoming the top PC maker, even bigger than IBM. His victory in that arena is complete, having driven IBM out of the PC market. Those of us who have watching the computer scene since the '70s should think back to what IBM was then.
Suppose a new kind of car were invented that a guy in his garage could make, and one of those garage hackers figured out how to mass-market his vehicle. If he did it so well that GM decided to get out of the consumer market altogether, that would rival what Dell did.
So what do he do when at 40 having accomplished what seemed like an impossible goal? I'd want my life to mean something besides business, but I'm not him.
I suspect you'll see Dell try to accomplish some new "impossible" goal, whether it's space exploration, a cancer cure, seawater desalination, selling electric cars, or whatever.
I don't know, because I don't dream big enough.
Re:Big dreams mean big wins - EXACTLY!! (Score:2)
Michael Dell is a BUSINESS MAN. He wants to make MONEY. Red Hat is just that: another revenue stream.
After Checking (Score:2)
Why the google news link? (Score:2)
MSNBC prints a story, and you arguably give more credit (by putting the link first) for that content to Google News.
Rocket Science? (Score:2)
Investors invest because they want to see a return on their investments.
Via google news? (Score:2)
In future, please just give us the relevant links. The editors around here are so bad they don't even notice people giving out about them. Editors sans narcissism, what will they think of next?
Drictionarry.com: "drope", verb (Score:2)
drope, tr. v. [Scatterhead English, from drop]:
1. To refuse to accept [linuxquestions.org], as in packets.
2. To apply [estateangels.co.uk] for a mortgage [intelligen...hecaire.ca]
3. To host a web page [cylex.de] but only in German.
4. To aspire to contribute to Wikipedia [wikipedia.org] but only in French.
--Rob
Linux GUI (Score:2, Interesting)
Obligatory (Score:5, Funny)
Re:Dell sucks until they offer an AMD (Score:2, Interesting)
I have to wonder though, how does Dell feel about ceding the AMD64 market to Sun? Must be rather annoying for them.
Re:Dell sucks until they offer an AMD (Score:5, Interesting)
These days I wouldn't buy from them, just because their financial situation is so bleak that there's no reason to believe that they'll still be in business in 1-2 years.
1. They have 7 billion in the bank, and they're more or less breaking even. That's not *that* bleak.
2. You have the hardware. It's a standard box with PC hardware. Who cares about whether Sun will be there or not?
Re:Dell sucks until they offer an AMD (Score:2)
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eBay has chosen Sun's Solaris Operating System and its suite of low-cost Solaris servers and Java software to help power the The World's Online Marketplace. If you're running a business like eBay's, or have similar aspirations, get some Sun.
but I'm curious as to
Re:Dell sucks until they offer an AMD (Score:2)
AC managed to get a "Troll" mod but what he's saying is relevant.
I know Dell would lose their sweetheart deal with Intel if they sold AMDs, but how much is that really worth? They must be throwing away a lot of home-user business here
Yes, Dells are really cheap, but not offering similar AMD boxes has to lose them market share...
Re:Dell sucks until they offer an AMD (Score:2)
If the PCs allow AMDs and redhat as a standard with no scruff and caveats. You can expect the prices of Dell machines to drop significantly. The wintel monopoly is forcing more money out of your wallet right now. That's why generic PCs are cheap
Re:Dell sucks until they offer an AMD (Score:2)
You'll probably be glad you got the warranty, since the non-standard components inside Dells will cost *way* more to replace than standard off-the-shelf ones.