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Dell pushing hard for customer satisfaction

With the one possible exception of the move into Wal-Mart Stores (NYSE: WMT), I'm getting very strong messages of positive change from Dell Inc. (NASDAQ: DELL). What I'm seeing is a company that is pushing hard in multiple directions to find the strategies that will return it to good standing. If Dell can untangle some sluggish bookkeeping and get its corporate interior straightened out, it can then forge straight ahead, unrestrained by its attempts to heal its marketing weaknesses. There's a lot of upheaval going on at Dell right now, but it's certainly not all bad.

Dell's move into Wal-Mart has met with mixed response. At first I myself didn't like the move but that's probably mostly because I wanted Dell to align with Radio Shack Corp. (NYSE: RSH). Given the fact that computer prices have reached the level where a discount retail chain can sell them for profit, I guess there's no reason why Wal-Mart shouldn't be the one to do it. As long as Dell keeps its consumer direct options open so that folks like me can "custom" build one, I'll concede that the Dell/Wal-Mart alliance may become a good one.

A definite positive move that Dell has recently undertaken is its decision to preinstall the Ubuntu Linux operating system. Linux seems to be a preferred operating system in circles of web "professionals." I have the distinct pleasure to rub elbows with some of the internet's best writers, and the more I do that, the more I find that the busiest ones seem to prefer Linux. The Linux change and other customer focused moves seem to be driven by input that Dell receives via its own community forums. "We are responding directly to feedback from customers," Dell spokesperson Anne Camden said.

Latest in a series of moves by Dell to become more deeply consumer responsive is their decision to allow consumers to "opt out" of preinstalled programming, sort of like an operating system line-item veto. Based on the success of a "no software preinstalled" option that Dell promoted with its XPS systems a year ago, Dell has determined to take the favorable response to that scenario a step further and will extend it to Dell Inspiron and Dimension lines. Analysts are speculating that there's a remote possibility that this change will mean a revenue drop for Dell, but there's little credence to that assertion. Besides, the focus here is a realignment of Dell with the consumer, and if done successfully, that's where all the gold is hidden.

Dell chooses Ubuntu for Linux offering

Dell (NASDAQ:DELL)has started listening to the vocal minority and will offer Linux as a pre-installed operating system option on newer PCs. This isn't exactly news, but the "flavor" of Linux that Dell has chosen sounds the most appropriate. Ubuntu Linux is becoming one of the more popular choices since it is so easy to use, and is strikingly similar to Microsoft Corp.'s (NASDAQ:MSFT) Windows in the "look and feel" department.

However, I still maintain that the majority of customers will continue to prefer Microsoft's Windows for the long term. From what I've seen, trying to get the mainstream Windows customer to try another operating system is like pulling teeth: people don't like change (even when it is better). Ubuntu will always feed a need for the cost-conscious (it's free) and hobbyist computer crowd, and it's used in come corporate environments and schools as well. But the corporate environment and most home environments? Nope.

At the end of May, Dell will begin offering Ubuntu's latest version on some of its PCs. So, even though I don't expect mass defections from folks buying Windows PCs to newer Ubuntu PCs, the significance of this is if Dell's relationship with Microsoft will suffer from this. Microsoft is tight-fisted when it comes to competitive operating systems, so if Linux variants start becoming more visible and commonplace on machines from large Windows vendors, what will Ole' Softie have to say? So far, the giant remains docile.

Linux option won't save Dell's marketshare

Based on a tremendous amount of customer feedback from its IdeaStorm customer feedback blog, Dell (NASDAQ: DELL) says it will offer the Linux operating system as a pre-installed option on new consumer PCs. While I wrote about this earlier, it is now coming to fruition. As Doug mentions here, though, this move will not do anything to counter Dell's sliding marketshare right now. I agree completely, and here's why...

Although Dell's position here is that the company is "listening to its customers" and now will be offering Linux as an alternative to Microsoft's Windows Vista operating system, the sliver of Dell customers wanting Linux, at least right now, is largely insignificant. It's generally known that the vocal minority can have the largest voice, and that is what is happening here.

It's very true that Linux (which I use on occasion) is every bit as good and robust (and easy to use) as Windows. There are arguments back and forth on everything from software applications to hardware support between Linux and Windows, but when the silent majority wants what they're used to (namely, Microsoft Windows...period), offering Linux on Dell consumer PCs will be a great marketing tool for the techno trendsetter but not to the average Joe consumer -- or the business PC user who needs that install of Microsoft Office at all times (or, funnily, the free OpenOffice suite).

Does Dell run the risk of angering Microsoft -- one of its largest customers -- by now offering a Linux option when a customer builds a PC at the Dell website? Probably, but I would think that frustration is limited. If (not when) more than 25% of Dell customers start choosing Linux on their PCs instead of Windows, then Microsoft may have a reason to be concerned. I don't think we are close to that happening at all, but one thing is for sure -- the vocal minority has spoken, and they want Linux.

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Last updated: May 27, 2012: 07:54 PM

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