In a new TBR research report, the analyst argues that EMC faces many challenges as it moves to becoming a part of Dell.
Not least is the change to its channels, EMC's partner ecosystem will need monitoring to make the change accretive, partners will have natural reactions to the large merger.
Many of the short-term challenges revolve around the base of transaction-oriented resellers awaiting clarity from Dell and from EMC on the new rules of engagement and conflict resolution that cannot be articulated until after the transaction finalises, it says.
Obvious concerns will be around local market conflict between Dell and EMC partners triggering price wars and margin erosions.
During the transition process, EMC can expect provocative press reporting and some short-term fallout as the combined entity sorts through the go-to-market segment issues.
While downmarket partner programs will face turbulence, EMC has a strong opportunity to forge tighter relationships higher up the partner stack with solution providers, cloud service providers and global system Integrators.
The efforts started at the federation level around these initiatives certainly aim the market motions in the right directions.
Key benefits EMC can articulate include, as Michael Dell intimated in his keynote remarks, the idea that it may be the case that Dell Technologies and HPE will be the last two infrastructure titans standing (with Cisco and Lenovo having at least some reason to take exception to the statement).
From this vantage point, they can sell efficiencies to these global suppliers on the benefits of working with the Dell Technologies stacks and software-defined assets underpinning the API first infrastructure enabling automated services.
EMC will be able to take the IP gained from the transformation consulting services with the core enterprise accounts and turn it into automated services that, in turn, save its partners time in their own services stacks.
Amid extensive IT disruption fueled by the ongoing customer desire to transform IT ecosystems and accelerate business initiatives, EMC rests on a critical pivot point that determines its role as a next-generation leader.
But through an umbrella theme of 'modernize' at EMC World 2016, the storage giant showcased innovation destined to push the company directly into leadership status across a number of modern technology realms.
EMC is responding to the accelerating transition of IT from a cost centre to an enabler of business advantage, with a steady shift in its innovation model toward flash technologies, abstracted and increasingly open software functionality, and 'as a Service' IT delivery.
More notably, EMC is preparing to diverge from its hallmark horizontal business model through its agreement to be acquired by Dell - an industry landmark both in its $67bn valuation and the implications of creating a combined $80bn behemoth. EMC World 2016 served as a ceremonial, unofficial passing of leadership from EMC CEO Joe Tucci to Dell CEO Michael Dell, marked particularly by planned branding of the combined organisation as Dell Technologies.
EMC executives touted continued innovation, with all major aspects of the company's storage portfolio refreshed to date in 2016, and messaged the potential inherent in combining Dell's scale and vast mid-market entrenchment with EMC's large enterprise cachet. Such messaging is crucial as EMC navigates a degree of customer and partner uncertainty as the deal moves toward finalisation, expected in 2H16. EMC has an increasingly clear strategy and the necessary elements in place to mitigate attrition in its vast existing storage installed base and grow in under-penetrated markets, such as the mid-market, during 2016.
TBR expects customers to turn to their IT providers for high-value engagements centred on navigating complex and challenging transformation initiatives. The longer-term path for EMC will mean building from this position following its integration into Dell. Competition is fierce, and will remain so as peers such as Hewlett Packard Enterprise (HPE) also evolve into transformation agents and seek to leverage the Dell-EMC integration as an opportunity for competitive displacement.
However, EMC executives are clearly working to identify pockets of industry transformation they can better capitalise on jointly with Dell, which portends quick integration when the acquisition is finalised. Further, Dell's supply chain and channel expertise, along with its newfound permission to play in the enterprise, will further spawn opportunity for EMC and its broad set of technologies.
