With Project Apex, Dell aims to surround the public cloud and tame it

At the virtual Dell Technologies World on Oct. 21 and 22, the company painted a picture of the future, a picture it calls Project Apex. “Apex” can refer to a summit, but it is also the term used to describe the top predator in an ecosystem. Dell Technologies spokespeople did not clarify which definition they intended in naming the project, but it is likely that the predator definition is used widely within the organization. The company aims to use Project Apex to conquer not only public cloud providers, its biggest threat, but also competitors that have similar offerings, such as Hewlett Packard Enterprise (HPE) and Lenovo.

Project Apex is a combination of Dell Technologies Cloud and the company’s goal of offering everything “as a Service.” Dell Technologies Cloud is a multicloud system that includes public and private clouds as well as all of an organization’s assets. Dell Technologies is prepared to manage these assets, both on premises and in the company’s data centers. This system combines the benefits of public cloud — demand-based pricing, simplified operation and outsourced management — with those of on-premises resources — greater control and flexibility, and more efficient use of edge devices. Dell Technologies intends to surround and engulf public clouds.

Project Apex is similar to HPE’s GreenLake initiative, which has the tagline, “The Cloud That Comes to You.” It is not surprising that the two largest data center hardware companies have similar strategies. In fact, while Lenovo’s multicloud and consumption-based pricing strategies are promoted less than those of Dell Technologies and HPE, Lenovo is moving in the same direction. These common strategies are a response to a common threat: the public cloud. Public cloud providers are meeting an increasing share of organizations’ computing and storage requirements, reducing hardware providers’ revenue and profits. All data center vendors have cloud service providers (CSPs) as customers, but CSPs’ scale and ability to provide their own services drive down hardware companies’ margins. The public cloud is a threat, and these combinations of multicloud offerings and consumption-based pricing are the hardware companies’ countermeasure.

Dell Technologies paints a rosy picture of the future, with free movement of data and workloads from the edge to the cloud and everywhere in between. This kind of fluidity would make it much easier for companies to implement and refine large numbers of diverse applications, enabling responsive and flexible digital transformation. The future, of course, is never as bright as pictured in the brochures. But the technology world is making progress in that direction, and Dell Technologies, as the self-defined provider of “essential infrastructure,” is well positioned to deliver it, albeit incrementally.

Project Apex includes the major technologies and techniques that fuel digital transformation. Dell Technologies Chairman and CEO Michael Dell listed six: hybrid cloud, 5G, AI, data management, security and edge. Every large IT system will include these components as well as others. 5G is especially interesting because, apart from critical hardware components for data transmission, it is a software-defined system, giving networking the flexibility that underpins Project Apex.

Project Apex is more a direction than a goal, and Dell Technologies and other tech companies have been moving in that direction since virtualization and its inevitable offspring, the cloud, became important. With the increasing importance of edge devices and edge-generated data, the Project Apex vision, where the public cloud is part of the picture but is no longer dominant, becomes more plausible.

Right now, however, the public cloud is growing rapidly at the expense of traditional on-premises data centers, and hybrid multiclouds are mostly just a vision. There is progress in “as a Service.” Dell Technologies on Demand, the company’s “as a Service” portfolio, now has a $1.3 billion annual run rate, reflecting 30% year-to-year growth. Annual recurrent revenue, which includes traditional financing and services, is $23 billion. Dell Technologies and the other hardware vendors cannot really see the light at the end of the tunnel, but they can describe it.