Interesting interview on CNet with Dell's CTO (who I don't think I've heard much of). Essentially he's saying that Dell may not have much R&D itself but it doesn't only leverage that of its suppliers, it tries to direct their R&D...
news.com.com 
To some, Dell marches to the beat of Intel and Microsoft drums, dutifully following their research and development plans. But to hear Kevin Kettler tell it, the PC maker often takes its own lead.
Not only is the company active in establishing technologies, but often it's the kingmaker for emerging standards, Dell's chief technology officer said. In an interview at LinuxWorld Conference and Expo here, Kettler outlined several areas where Dell has gone its own way--over objections from Intel and Microsoft--and has cut behind-the-scenes deals that brought new developments to market.
Essentially, Kettler argued, Dell was responsible for selecting, if not necessarily developing, many of the technologies in today's desktop computers and servers. Among standards for which he said Dell deserves credit are 802.11 wireless networking, PCI Express communications technology and 64-bit extensions to Intel's x86 line of processors.
Dell's assertiveness has led to friction at times between the company and its major allies, however. Just last Monday, Kettler spent eight hours in a meeting with Intel. It was productive, but it "wasn't pretty," he said.
In the past, Microsoft and Intel had more power, said Roger Kay, an analyst at Endpoint Technology Associates. There were few alternatives when PC companies wanted to buy chips or operating systems, and not many computer makers were dominant enough to set terms. But now, with major consolidation in the number of PC sellers as well, there are more power struggles, he said.
"Some very large players--Cisco in networking, Microsoft in operating systems, Intel in chips, Dell in PCs, Best Buy in distribution--they're all jockeying for a dominant position, bluffing, feinting," Kay said. And overall, Dell does indeed hold more power than the past. "It's a little braggadocio, but I think essentially the story holds," he added.
But overall, Dell tends to follow Intel's lead and isn't setting the agenda, said Gartner analyst Steve Kleynhans. "They tend to get involved at the point where technology is getting standardized, and they popularize it. They get it out to a lot of people," he said. "But I don't see them as being the driver of a technology or the one that sets the direction."
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Intel isn't the only major ally to have fallen out of step with Dell. The PC maker's customer surveys have led it to believe the Blu-ray format should succeed DVDs, Kettler said. At the same time, royalties for Blu-ray are lower than for the rival HD DVD format, and the Blu-ray video content is better, he added.
Microsoft and Intel endorsed HD DVD over Blu-ray in September, and Hewlett-Packard, formerly a strong Blu-ray advocate, softened its stance shortly afterward. Kettler suggested Microsoft hasn't revealed the true reason for its fondness for the format. The company has a "franchise to protect," he said: its Xbox business, which competes with the Blu-ray-enabled Sony PlayStation 3.
Microsoft, not surprisingly, disagreed with this assessment and asserted its motives for preferring HD DVD are broader. HD DVD drives and disks are cheaper and arriving sooner, argued Jordi Ribas, director of technical strategy in the Windows Digital Media Division, and interactive elements of the disks are easier to program in HD DVD's iHD than in Blu-ray's Java.
"With Intel and HP sharing our views on this as well, I would say these (factors) are more critical for the PC ecosystem than for gaming," Ribas said. "Blu-ray has been spinning a good yarn over the past year, but it's becoming clearer that the technology is more expensive and has fewer features, and many of their technology claims are far from deliverable."
Dell is sticking to its guns, though. "Microsoft may bitch, Intel may bitch," but the customers want Blu-ray, and that's what matters to the PC maker, Kettler said.
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