February 7, 2000 10:15 AM PST

Dell eyes ISPs, Web hosting

Dell Computer formed a sales and marketing division today targeted at Internet services providers and Web hosting firms.

The PC maker's new group, dubbed the Internet Partners Division, will focus on selling its servers and data storage products to ISPs, Web hosting firms and application service providers (ASP). The group may also invest in Internet start-ups, according to Dell spokesman Jon Weisblatt.

"(The division will) focus on what we see as up to a $30 billion opportunity over the next several years ? helping customers build their Internet infrastructure," Weisblatt said.

Through the project, Dell joins rivals Compaq, IBM and Hewlett-Packard in targeting products and services at growing Internet businesses. Compaq, for example, has recently cut several hosting deals with network providers to sell its hardware equipment to emerging companies.

Like its rivals, Dell also has made several investments in Web hosting firms and ASPs--including Interliant and NaviSite--to gain a wider presence in the market. Compaq invested in FutureLink, another Web hosting company, and most recently, in ASP Digex.

Dell's new unit will be led by former Adobe Systems executive Judi Webster, the company said. A formal announcement is expected soon.

Two weeks ago, Dell warned its fourth quarter earnings will fall short of analysts' expectations.

The Round Rock, Texas-based company said it could not deliver on consumer demand during the holiday season because of component shortages. In addition, corporate customers continued to delay purchases because of Y2K concerns, costing the PC maker $800 million in lost sales.

 

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