EDS buy could give HP edge over Dell, analysts say

Dell is not at the top of the list to provide managed services, and it's going to be an uphill fight if the company chooses to get into the large global services business. The company has the brand equity and supply chain, but services are not at the core of Dell's offerings, Roehrig said.

HP's acquisition hasn't changed Dell's services strategy, said Cathie Hargett, a Dell spokeswoman.

"Customers are telling us that services can be simplified and that they should give companies more control, value and flexibility -- not complex, long-term contracts and armies of consultants," Hargett said.

Dell will continue to offer services such as remote management for everyday routines such as virus updates, asset management and software licensing. It acquired remote management services companies such as Everdream and Silverback to boost these efforts.

"We believe this is the best way to improve the price/performance of services for companies who spend 70 per cent of their budgets just keeping the lights on," Hargett said.

Dell's business relationship with EDS will continue, Hargett said.

"Dell's relationship with EDS goes back to the early 90's and continues today. We don't anticipate any change in this in the short- to midterm." Hargett said. Dell also has strong relations with outsourcers and integrators, including IBM and Affiliated Computer Services, Hargett said.

A HP representative declined comment.