Dell ended 2012 much like it spent most of the year, by acquiring yet another moderately sized enterprise technology vendor to further its transformation into a software company.
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This acquisition, like many of the others this year, leaves customers wondering what Dell’s ultimate plan is.
Dell acquired Credant Technologies this week, a Texas-based company that makes data encryption software for managing and encrypting corporate data sent from endpoints to servers, storage and the cloud.
"Encryption is Credant's bread-and-butter, but I'm almost surprised Dell didn't already have technology similar to Credant," said Chenxi Wang, a security analyst at Forrester Research Inc., a firm based in Cambridge, Mass.
Dell data encryption software for mobile devices
This acquisition fills Dell's desire to build out its mobile device support ambitions, Wang said. Dell has several mobile device management products in its portfolio, but the potential capabilities of Credant's technology for the mobile security ecosystem fill an important gap.
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"With mobile devices you want that file-level encryption, and if Dell ventures further into the mobile device market, it will be a good thing to have," Wang added.
The companies have a long-standing relationship because Dell relies on Credant for its Dell Data Protection/Encryption product.
With this acquisition, Dell gains not only new intellectual property, but more software customers and more employees. Once the acquisition closes, Credant's 90 employees will join Dell's End User Computing Solutions team, according to an internal Dell memo.
Credant claimed it secures more than two million endpoints across industries, including defense, health care, media and universities.
Financial terms of the acquisition were not released.
Dell furthers its software ambitions
This deal is another in a long line of acquisitions Dell made in 2012 surrounding enterprise security, management software and storage, said Adrian O'Connell, an analyst for Gartne Inc., a research firm based in Stamford, Conn.
However, IT pros aren't sure what to make of Dell as a software company.
"The bigger challenge facing Dell is one of credibility," O'Connell said. "Are there enough customers who understand the nature of the new Dell or trust them to become that enterprise technology company?"
Based on customer feedback from Dell's recent user conference in Austin, Texas, it seems plenty of people don't know what Dell intends to do with its bevvy of acquisitions.
"It's like that Frankenstein approach where the left leg doesn't seem to know what the right one is doing because they just keep adding parts to the beast, said a systems admin for the Harris County Government in Texas, who requested anonymity.