* Forms unit for communications and mobile devices
* New unit led by Ron Garriques, former consumer head
(Adds analyst comment, details on new unit, background,
By Gabriel Madway
SAN FRANCISCO, Dec 4 Dell Inc DELL.O is
forming a new business unit focused on communications and
mobile devices, the second reorganization for the personal
computer maker in the past year.
The new communication solutions unit will be led by Ron
Garriques, the former Motorola Inc MOT.N executive who was
head of Dell consumer business. Former PC leader Dell, now No.
3 in global sales, had announced last month that it would start
making cell phones.
The smartphone market is dominated by the likes of Apple
Inc's (AAPL.O) iPhone and Research in Motion's RIM.TO
BlackBerry, but Dell and other PC makers are trying to
establish a toehold in the fast-growing sector.
"This is further confirmation that leading PC manufacturers
cannot resist mobile space despite high barriers to entry and
low probability of success," said CCS Insight analyst John
Dell spokesman David Frink said the change was announced
internally earlier on Friday.
Dell formally announced its entry into the mobile phone
market last month. Its Mini 3 smartphone is being launched in
China and Brazil this year.
Although he declined to provide details, Frink said the new
unit will focus on developing hardware and software for
communications devices of "various screen sizes," including
mobile Internet devices.
He said Dell was looking to allow customers to "connect
anytime, anywhere" through computing products and services.
Dell hired Garriques away from Motorola in 2007 to lead its
new consumer business, following the return of Michael Dell to
the CEO post. Garriques' arrival touched off a wave of
speculation about Dell's designs on the mobile products market,
where it has not historically had much success.
Last December, the company reorganized into business groups
defined by market segments from one defined by region.
Dell said Friday it consumer business also will be combined
with its small-and-medium business (SMB) unit and will be led
by Steve Felice, streamlining operations and reducing costs.
When asked about possible job cuts related to the
reorganization, Frink said there "was nothing to report now."
The company, which relies heavily on sales of PCs to
businesses, has had a difficult year as enterprise spending has
dried up amid the global economic downturn. But analysts say
the company stands to benefit from a surge in business demand
for IT hardware next year.
Dell has been losing market share in PCs and was recently
supplanted by Acer Inc (2353.TW) for second place in global
The company has been focused on profitability as it aims
diversify its revenue base into higher-margin offerings.
Shares of Round Rock, Texas-based Dell closed unchanged at
$13.46 on Nasdaq and rose 3 cents in after-hours trading.
(Reporting by Gabriel Madway; Additional reporting by Tarmo
Virki in Helsinki; Editing by Carol Bishopric and Richard
((firstname.lastname@example.org; +1 415 677 2536))