October 17, 2011, 4:24 PM — Dell announced it has ended a decadelong reseller relationship with EMC this month through which it sold more than a billion dollars worth of midrange and entry-level storage products.
The reseller agreement, which began in 2001 , has twice been renewed and was supposed to expire in 2013.
Travis Vigil, Dell 's executive director of product marketing for enterprise storage , told Computerworld earlier this year he would not speculate on whether the company would renew its reseller contract with EMC , saying only that it would continue to care for its joint Dell-EMC customers. That is exactly what the company said it will now do.
The partnership has been extremely profitable for both companies. Annually, EMC garnered 8% to 9% of its revenue from its relationship with Dell. For Dell, the partnership accounted for 50% of its storage revenue in years past -- about 90% of it coming from the resale of EMC's midrange Clariion line and 10% from the high-end systems.
For the past five or so years, there has been speculation that Dell and EMC would cut ties as Dell continued to bring more upscale storage to market and EMC continued to move downstream with products, creating hotter competition between the two technology giants.
Over the past three-and-a-half years, Dell invested more than $2 billion to expand its own family of storage products built for the virtualized, cloud -based data centers. Those investments include acquisitions of such companies as EqualLogic, Exanet, and Ocarina. Then, last year, Dell purchased SAN-vendor Compellent Technologies , which put it in direct competition with EMC's Clariion line.
Dell also announced it will invest another $1 billion this fiscal year in a broad range of storage technologies to extend its global reach into data center , mobile and cloud environments.