Acquiring Perot Systems won't put the computer maker in the technology services big leagues. That's not such a bad thing.
BURLINGAME, Calif. -- There comes a time in every great computer company's life when it graduates from being a builder of boxes to an architect of businesses. Or so it seems.
In 2002, IBM ( IBM - news - people ) capped its push to build a consulting business with the acquisition of the consulting arm of PricewaterhouseCoopers. In 2008 Hewlett-Packard ( HPQ - news - people ) acquired EDS for $13.9 billion
On Monday, Dell ( DELL - news - people ) said it agreed to acquire Perot Systems for about $3.9 billion. The problem: The only thing big about Perot Systems ( PER - news - people ) is founder Ross Perot's ears.
If the name of the game is vertical integration--getting a grip on the outlets selling your company's products--it's hard to see how swallowing a pipsqueak like Perot Systems will help Dell keep up.
In its most recent quarter, IBM's services businesses grabbed $13.4 billion in revenues. HP generated $8.5 billion. Perot Systems, by contrast, recorded just $628 million in sales.
So why do the deal? The two major standalone technology consulting firms, Accenture ( ACN - news - people ) and Infosys, are out of reach, for starters. Accenture's market valuation is $25.6 billion. Infosys is worth $28.1 billion. Dell, by comparison, is worth $31.4 billion.
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