Michael Dell hits back at 'lack of innovation' accusations

By Eugene Lacey

Michael Dell sounded a gloomy note on tablet PCs at the opening of the Gartner Symposium/IT expo 2002 in Cannes on Monday as he hit back at critics of Dell's record on innovation.

Although his company is running a pilot scheme to test tablet PCs - Microsoft's new form factor for delivering Windows in pen-controlled devices that ship this week - Dell told a press conference he did not expect tablet PC to achieve 25 per cent of all computers sold.

Dell said that his company concentrates on "speed to volume" as opposed to speed to market.

"We're waiting to see what the demand is. If our customers want the product (tablet PC) in volume, it is very easy to deliver it," he said.

Earlier, in a keynote Q&A session with Gartner analyst Peter Sondergard, Dell returned to recent criticisms of Dell as lacking in innovation.

"Innovation goes beyond products - it goes into process... We innovate in process and product and service... driving cost out. That's where Dell innovates."

Innovation had to be focused on customer needs, Dell said. "The thing that I've heard from customers is if you don't have something that helps me drive cost, and which simplifies things, makes it easier to do business, then they are really not very interested in hearing about it."

Relevant innovation that matters to customers is where Dell likes to spend its R&D investment. "In our industry there is a lot of technology for technology's sake. Quite frankly that is not what Dell is interested in."

One new innovation that meets Dell's customer relevance criteria is 802.11b.

"We lead the market in 802.11 shipments" he said, adding that he was very excited about shipping built in wireless with the Intel Banias-based product lines next year. Dell sees further growth for 802.11 as costs are driven down, and warns that some promising wireless innovations (such as GPRS in Europe) will benefit PC vendors more than phone manufacturers.

Eugene Lacey writes for ZDNet UK