Michael Dell names Michael Dell new head of company started by Michael Dell

The one-time people's PC maker is going private, with help from Microsoft. Is this a new start or the beginning of the end?

Ladies and gentlemen, please greet the new owner of the company founded by Michael Dell: Michael Dell.

The world's 22nd-richest man made good on his vow to take the company he founded nearly 30 years ago private. But unlike with dorm room startup PCs Limited, this time Dell has some deep pocketed partners: private equity firm Silver Lake, which is ponying up $1 billion of the $24.4 billion deal, and Microsoft, which is loaning Dell $2 billion. Most of the rest will come in the form of debt, making this one of the largest leveraged buyouts since the days of Michael Douglas and his brick-sized cellphone in "Wall Street."

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The consensus on the street: This is a risky move by Dell, both the man and the company, in large part because you can make more money selling oranges at freeway off-ramps than you can selling PCs these days. On the other hand, being able to do it without the Wall Street breathing down their necks will probably be a relief. It's also risky for Microsoft, which could end up further alienating other hardware OEMs, who are already ticked off about the Surface debacle.

HP, for its part, issued a brief and snotty statement about the deal:

Dell has a very tough road ahead. The company faces an extended period of uncertainty and transition that will not be good for its customers. And with a significant debt load, Dell's ability to invest in new products and services will be extremely limited. Leveraged buyouts tend to leave existing customers and innovation at the curb. We believe Dell's customers will now be eager to explore alternatives, and HP plans to take full advantage of that opportunity.

Coming from the company that's had three CEOs resign in disgrace over the last few years, and both exited and reentered the PC business, that's pretty rich. Talk about extended periods of uncertainty and transition.

I realize this is the first time I've written about Dell in as long as I can remember. In the old days my mailbag used to fill up with complaints about Dell. For a while it was the most popular topic of Cringesters. For whatever reason that stopped a few years ago. I figured there were three possible explanations:

  1. People were taking their gripes elsewhere.
  2. Dell computers became so trouble-free people no longer had anything to complain about.
  3. People stopped caring about Dell.

My money is on no. 1 or no. 3. When Notes From the Field transformed from a weekly 400-word column to a thrice-weekly 700-word blog back in April 2007, there was actually less opportunity to write about people's problems with their hardware, perversely enough. Essentially it's hard to write about failing hardware and lackluster support at that length without boring the heck out of everyone else.

(No, I didn't get a pay raise, thanks for asking.)

I suspect also Dell's transformation from the people's PC maker to an enterprise supplier led to fewer complaints from end-users. Machine builds were more uniform, there was less variation in the kinds of hardware it had to support (and thus fewer opportunities for things to go wrong), and the customers were mostly IT experts -- all of which would lead to fewer complaints. Maybe reason no. 2 was a factor as well.

In any case, it ought to be interesting to watch what happens next. Will Dell turn into the next IBM or the next DEC? Guess we'll find out -- assuming Dell, et al. decide to share that with us.

Is this a company-saving move or the beginning of the end for Dell? Posit your theories below or email me: cringe@infoworld.com.

This article, "Michael Dell names Michael Dell new head of company started by Michael Dell," was originally published atInfoWorld.com. Follow the crazy twists and turns of the tech industry with Robert X. Cringely's Notes from the Field blog, and subscribe to Cringely's Notes from the Underground newsletter.

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