On the high end, Dell also has a partnership with Egenera -- its software is designed to automate the entire data center, creating large virtual pools of processing called a Processor Area Network, or PAN. Dell is bundling together EMC storage, XenServer, and PowerEdge servers equipped with Egnera software as the Dell PAN System.

"We're finding out that for a small business customer, they're looking for an ease of application deployment. Our midrange business customers are looking at how they can move their hard drives out of their servers and onto their networks, and how they can manage their physical/virtual environments more simply. Our biggest enterprise customers are looking at how they can virtualize and automate their entire environment," says Becker.

Analysts applaud the Dell PAN System move. "Licensing the Egenera technology was a very good move for Dell," says Judith Hurwitz, President, Hurwitz and Associates.

Dell Services
Dell has servers, bundles and deals with the major hypervisor makers. So what else does Dell bring to the party? Expertise. Its Services group offers assessment, planning, installation and training.

And despite support for Microsoft, Citrix/Xen and others, Dell consultants today focus almost 100 percent on VMware, offering what Dell calls "a direct, uncomplicated approach that simplifies, speeding time to productivity" and a "standards-based virtualization strategy." Dell claims that its virtualization installations, on average, lower TCO by about 25 percent.

While Dell remains a huge VMware fan, its services plan is to be hypervisor-agnostic. "We've been providing VMware services for some time. We're expanding those services. We will also be providing a complete set of services around the XenServer set of products. And we are already working with Microsoft on their upcoming release of Hyper-V and will have complete end-to-end services for that product as well," says Tim Webb, Dell's director of Services.

Besides building new virtual environments, Dell Services can optimize existing shops. Dell's Assessment services include tools that discover the servers and levels of utilization. This helps guide which servers and apps are ripe for consolidation.

Next Dell can design a plan, which typically calls for Dell servers, VMware ESX, VMware's Virtual Center, VMotion, and a combination of Dell and EMC SAN storage.

What that plan won't typically entail is a raft of Dell management tools that could lock the customer in. "As virtualization takes hold we have an opportunity to break the proprietary lock holds of systems management. We have OpenManage, which is integrated with VMware and Citrix and it's a great solution for our customers that want to do a one-to-one or one-to-many. But it shouldn't be about what the vendor wants, it should be about what the customer wants," says Webb.

Storage: EMC vs. EqualLogic
Dell's storage strategy is two-pronged. The company has a long-standing relationship with EMC Corp., where Dell sells and even manufactures EMC gear. The EMC line has an array of virtual features, and Dell sells these AX and CX boxes to a largely high-end audience.

This February, Dell bought EqualLogic for $1.4 billion, and in the process gained a line of iSCSI SAN storage devices that boast some virtualization features such as thin provisioning.

"Dell, with its acquisition of EqualLogic, now has a storage virtualization strategy. EqualLogic's arrays are consolidated under a single management system. The acquisition is a great boon for small and midsize businesses and departments within larger enterprises who want to embrace virtualization," explains Deni Connor, principal analyst for Storage Strategies Now, a storage-focused research and consulting firm.

Many thought the EqualLogic acquisition would spell the end of the EMC deal, which runs through at least 2011. Instead, Dell aims the EqualLogic gear at small to midsize businesses and EMC at larger enterprises.

Maybe a bigger issue is protocols. EqualLogic is iSCSI only, while EMC talks both Fibre Channel and iSCSI. As a storage veteran, EMC also has a broader selection of tools than EqualLogic, which was still a startup when Dell bought it.

In a recent white paper, Dell argues that when it comes to storage virtualization, iSCSI tools such as EqualLogic are far superior to Fibre Channel, which is largely what EMC offers. That's because Fibre Channel SANs are hard-coded as each port has its own World Wide Name embedded in the physical device.

Because it's based on TCP/IP, iSCSI SANs use DNS and therefore the addresses themselves are virtual.

Dell argues that the EqualLogic tools have several advantages, including fast setup time. Praveen Asthana, director of Storage for Dell, argues that an EqualLogic SAN can be set up in as little as 20 minutes, far faster than Fibre Channel SAN.

Asthana also argues the iSCSI-based EqualLogic boxes are more flexible. "When you implement a virtualized environment, you're talking about a lot of unpredictable movement of virtual machines, which has unpredictable demands on storage. To actually move VMs around you'll need to dynamically reallocate your storage. With all of the current arrays, it's very difficult to do."

EqualLogic PS Series array storage virtualization features include:

• Can virtualize volumes across disks and controllers
• Virtualizes storage I/O
• Thin provisioning

Dell also claims that its storage line works with virtual environments, backing up applications and handling file-level backup and restore on VMs. The strategy of working with virtualization has a decided VMware bent. Dell can back up and restore VMware files, known as .VMDKs which helps restore an existing virtual machine. Dell storage also works with VMware Consolidated Backup.

Dell and the Virtual Appliance
While a server equipped with VMware or Microsoft Virtual Server seems pretty simple, an appliance is even more basic. And Dell has a ton of them, including software-only appliances or VMs and hardware appliances pre-loaded with specific applications.

Software appliances, which are often designed for easy evaluation rather than deployment, include:

• Symantec Mail Security
• Red Hat Appliance Stack
• SuSE Linux Enterprise Server
• Ubuntu 7.10 JeOS with VMware Tools
• BlueLane VirtualShield
• Enterasys Secure Networks Dragon Enterprise Security Suite

You can even download Windows Server 2008 or Exchange as a VM to give it a whirl.

The Buying Process
Dell is also trying to make it simpler to buy servers and virtualization software. Under the new Web site, www.dell.com/VMwareNow, customers can buy everything online. "It will streamline the path for customers to upgrade to full VI 3 enterprise licensing," explains Sally Stevens, director of PowerEdge Servers. Two of Dell's newest servers, the PowerEdge R805 and R905, come with either VMware ESX 3.5 or XenServer Express. These machines can handle up to 60 VMs each, Dell claims.

The Customer View
One customer is looking forward to exploiting what Dell has to offer in hardware and software, but probably won't need Dell Services. "As far as what Dell and others are doing, my opinion is they're beating a much bigger drum than we need or can dance to. Not saying what they're doing isn't good, because it is. I just feel like we've got the know-how to get it done in-house and on our own terms. I do use their online resources to help/advise me on what our next move should be," says Nick Clark, an MCSE and IT pro with Kerber, Eck & Braeckel LLP in Springfield, Ill. "We've got a couple Dell PowerEdge servers right now that we plan to roll into virtual servers. I'd like to set up as many as three virtual servers to each of these two servers, which would likely drop our total existing system by 50 percent. The scary part is that a couple of these servers will be servicing public extranet information and I don't know if I'm going to jump off that cliff yet."