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Story URL: http://hardware.silicon.com/desktops/0,39024645,39127101,00.htm

Dell dismisses "one-product wonder" iPod as a "fad"
And isn't too impressed with the Mac mini either…

By Andy McCue

Published: Monday 17 January 2005

Dell has questioned Apple's long-term business strategy, dismissing the iPod as a "fad" and a "one-product wonder" and claiming the new Mac mini won't dent the PC market.

In an interview with silicon.com at Dell's Round Rock headquarters in Texas last week, CEO Kevin Rollins said the number of headlines Apple grabs does not worry him and that the company isn't "in the same league" as Dell.

"It's interesting the iPod has been out for three years and it's only this past year it's become a raging success. Well those things that become fads rage and then they drop off. When I was growing up there was a product made by Sony called the Sony Walkman – a rage, everyone had to have one," he said. "Well you don't hear about the Walkman anymore. I believe that one product wonders come and go. You have to have sustainable business models, sustainable strategy."

But Rollins was careful to add that this wasn't meant as any kind of disparagement of Apple. "They've done a nice job," he said.

Apple announced its new sub-£350 entry-level Mac mini that is aimed at tempting wavering PC users across to the Apple camp last week while silicon.com was visiting the Dell headquarters.

But given Dell's historical commitment to aggressive pricing in the PC market and its dominant position in the US, Rollins was, not surprisingly, unimpressed with the Mac mini.

"It might take some here and there, but Apple's market share in the global computer business has really shrunk pretty far. Where they've been making success recently is not in the computer business, but in the iPod music business," he said. "So this might be an interesting new product but I'm not really believing this is going to turn the industry upside down."

Dell recently extended its foray into the consumer market with its own music download service to go with its own MP3 player, but Rollins said Dell will continue to focus on businesses as its number one priority.

"Our strategic focus has been on corporations and institutions, and selling them large server clusters and huge SAN installations - the data centre isn't very sexy to write about but, frankly, that's where the money is. Number one is corporations and institutions," he said.

Read the full interview with Rollins later this week on silicon.com for his views on Dell's future growth, consolidation, playing the violin, motocross, the Republican Party and more.