Dell: We missed some pretty big things

Michael Dell talks about the company's past stumbles and looks ahead to Dell's renewed growth and innovation.

Ina Fried Former Staff writer, CNET News
During her years at CNET News, Ina Fried changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley.
Ina Fried
3 min read
Walt Mossberg, Michael Dell
Walt Mossberg interviews Michael Dell at D6. Dell talked about his company's past mistakes and looked ahead to new products and approaches. Dan Farber/CNET News.com

CARLSBAD, Calif.--Michael Dell acknowledged Wednesday that his company has in the past missed some key industry trends, such as the importance of retail sales and consumer products.

But he promised that the PC maker will not be a technology laggard going forward.

"We've tripled our resources in design and user experience," the company's founder and CEO said in an interview with technology journalist Walt Mossberg at the D6 conference here.

Pinned down on where the company went wrong, Dell pointed to a couple of factors--in particular a lack of attention on the consumer market at a time when it was becoming increasingly important.

"We missed some pretty big things that were going on in the industry," Dell said.

Also, as the price of computers came down, the company didn't offer enough options for people to buy PCs. After years of focusing on direct business, the company has added its products to 13,000 retail locations.

Dell said the company has a few test Dell-branded stores operated by partners in places like Dubai and Moscow, but said that Dell is not focused on its own retail outlets.

"I think this year we will grow our earnings per share again pretty nicely."
--Michael Dell, founder and CEO of Dell

"Right now what is more interesting to us is to pick the best retailers in the world (and sell there)," Dell said.

Mossberg also pointed out several times that HP continues to lead Dell in PC unit shipments.

"True enough, although we are ahead in revenue."

Dell also noted that the company's business is growing quickly again, even outpacing Apple in some segments.

"I think this year we will grow our earnings per share again pretty nicely," Dell said. Asked about impact of the economy, he said, "In the U.S. there is definitely caution," noting that PC sales in the U.S. rose only 3.5 percent in the first quarter, although Dell itself was up more than 15 percent.

Dell also said that Microsoft is being more forthcoming with PC makers on information about Windows 7, the upcoming version of Windows, than it was in the past with Vista.

"What we are seeing right now is an unprecedented level of engagement from Microsoft on Windows 7...That's fantastic. It's what we need. That early-on engineering engagement with our engineering teams is how you create (a thriving) ecosystem."

A new, smaller desktop
Dell also promised the company was coming out soon with a new desktop that is 80 percent smaller than a traditional PC and uses 71 percent less energy.

"Think of it as the hybrid PC," he said.

Pressed on whether Dell would come out with its own phone, Dell said the company was focused on devices that were a little larger than a basic phone and smaller than a PC. "In between that there is all kinds of opportunity for different devices."

Asked whether Dell needed to do something different on the marketing front to better compete against Apple, Dell noted that his company and advertising firm WPP created a new agency just for Dell to help unify what has been a very disparate marketing effort.

For no clear reason, another questioner asked whether Dell could handle Apple CEO Steve Jobs if it came down to a physical fight. "Absolutely I could take him."

Click here for full coverage of the D: All Things Digital conference.