In the meantime, the computers that power servers behind data processing generative artificial intelligence (AI)the president of Dell Technologies in Brazil, Diego Puerta, assesses that a exemption must take into account the potential to bring benefits to the country, such as job creation.
The company celebrates being the only region in which its own factory supplies almost the entire national market. “If there is flexibility in the cost of the GPU for import for local assembly, it is a way for us to improve the condition for the end user, so we see this with good eyes”, says Puerta in an interview with InfoMoney.
“One of the original demands of many data centers it was being able to import the servers assembled to build their data centers here, taking advantage of the energy matrix”, says Puerta. “The component comes cheap, ok, the problem is just importing the already finished product, which would bring few benefits to the Brazilian market.”
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Dell () operates in a market benefiting from boom and generative artificial intelligence (AI)which led peers like () to compete for the position of most valuable company in the world with its AI computers.
Although it is known in offices and homes for its computers, keyboards, mouses and monitors, Dell develops some of the items necessary to place data centers – responsible for processing AI functionalities – standing, like racks and shelves where computers are connected.
“Today we see a very large demand, but it is still concentrated in North America. It is starting to become more global: some countries in Asia, a little something in Europe”, says the executive. “In Latin America, there is a lot of curiosity among players [por IA]but still we are not seeing a scale of investment on the scale of the United States.”
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In the quarter ending in August, Dell’s net revenues in the infrastructure solutions line, which includes servers optimized for artificial intelligencegrew 37.6% compared to the same period of the previous year, from US$ 8.4 billion to US$ 11.6 billion.
Check out the main excerpts from the interview with Diego Puerta, president of Dell Technologies not Brazil:
InfoMoney: At a time when companies are exposed to the server market, with an increase in demand produced by generative AI, how much did Dell have to reinvent itself?
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Diego Puerta: Dell has been in a process of reinvention since its founding. Michael Dell He created and reinvented the company: changing segments and expanding the area of activity, expanding coverage, changing products, increasing the portfolio. If we were to make an analogy with the 25 years in Brazil, the transformation of the Dell company during these years was enormous, while we started operations and grew and developed in the country.
In addition to starting our operation, we had to adapt an entire process of constant transformation of the company, because at that time, we were mainly a supplier of PCs, notebooks, desktops, servers, and we were testing some other markets, with services linked to the box. Since then, we have expanded our portfolio, acquiring more than 20 companies, including EMC itself, service and solution companies. We closed capital, we opened capital.
In the coming years we want to change, we want to build a Dell that is more agile, more efficient, more modern and attentive to customer needs. So this is the direction we want to focus on.
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When people ask me if, having worked at Dell for 25 years, I don’t get sick, I answer that this dynamic of reinventing yourself, going through 10 different positions, changing areas, makes me look back and see that these 25 years for me they worked. It is a process of constant evolution, so much so that several of our competitors have fallen by the wayside.
InfoMoney: What is Brazil’s part in this reinvention and what is unique about the country compared to the global operation?
Diego Puerta: What is very positive about Dell and helps with the success we have in Brazil is that we seek to have the most global and standard processes possible. When we launch a new product, it is automatically made available here in Brazil. There may be a hiatus of a month or two, but technologies, processes and changes always happen in a similar period with the rest of the world.
Often what is up to us is to connect this new direction with the reality of the market. This is the role that my team and I play: connecting with market dynamics, if an adjustment is eventually necessary, those local taxation issues, local legislation issues or even some demand from local customers. We change, and when we change we do it very quickly, on a global basis.
InfoMoney: Is the demand for growing data center infrastructure linked to generative artificial intelligence (AI), which has drawn attention to Brazil due to its renewable energy matrix, already reflected in the company’s business here?
Diego Puerta: The demand for data centers has grown significantly. We see a very large dynamic of new investments taking place, it is a very heated market. We have partnerships with most of the local data center players, which have a different dynamic from those of hyperscalers. We see that globally there has been a very strong movement with a very high demand for GPUs.
Dell’s open data shows this: we have a backlog of US$3.8 billion in GPU servers alone, in addition to what has already been delivered. But this demand is still largely concentrated in North America and is now starting to become more global: some countries in Asia, something in Europe. In Latin America there is still a lot of curiosity among players, but we still don’t see a scale of investment on the scale that is happening mainly in the United States, where most of the demand is today.
InfoMoney: Is demand growth in the region coming more from hyperscalers?
Diego Puerta: We see growth in curiosity, in testing, everyone wants to validate something. Assembling a concept or creating a use case requires a much simpler, more dynamic environment. It could even be the cloud, a test environment or even less sophisticated environments that won’t need a server with eight GPUs and liquid cooling.
You can test a model and then, after it matures, you have a result, expand it. The point is that the cost of this is a factor that concerns many companies. Cases of public companies with hundreds of millions of dollars spent on public cloud, and many of them are setting up their private cloud. So what we see are timings different between geographies, but we believe it will happen.
InfoMoney: There is a request from companies in the data center sector and even large GPU developers, such as Nvidia, for some type of tax benefit on the import of this equipment. What is their assessment?
Diego Puerta: We set up our equipment here. Some components, such as processors and GPUS, are imported, there is no local production. If there is flexibility in the cost of the GPU for import for local assembly, it is still a way for us to improve conditions for the end user, so we welcome this.
One of the original demands of many data centers was to be able to import the servers assembled to build their data centers here, taking advantage of the energy matrix. It is an issue that I, as a member of Abinee [Associação Brasileira da Indústria Elétrica e Eletrônica]not only Dell, but as a class entity, I see it as a solution that is better for the Brazilian market.
The data center involves some investment in physical assets, but it consumes a lot of energy and at the end of the day it is a business that does not generate a large volume of labor. So let’s produce these servers in Brazil, instead of importing them ready-made, making it a more competitive market to produce locally. It can become an export base, sell cheaper and serve the Brazilian market, employing employees. That’s my point: the component comes cheap, ok, the problem is just importing the already finished product, which would bring few benefits to the Brazilian market.
InfoMoney: Dell is undergoing a restructuring of the production chain globally. Will there be an impact on the Brazilian factory?
Diego Puerta: To be competitive in Brazil, we need to have a factory here, so we will continue investing in our production capacity. The reinvention that is taking place in our production chain is very focused on making it more efficient: using prediction models to increasingly adjust demand and the purchase of components. Dell only produces what has already been sold, so we need very high planning efficiency.
With artificial intelligence, we will be able to set up an optimization to, for example, know on which specific day we need to order certain components, to have as little cash exposure as possible in inventory, maximize working capital with planning and simplification .
It is in this sense that we are reinventing ourselves. For example, instead of having 20 different types of motherboards, what if I have a product line that allows me to only have three or four? If we have more modularity between components, we can even buy from the same supplier, but with fewer variations. This reduces inventory risk.
This interview is part of Guideline, a series of InfoMoney interviews with executives and leading experts on strategic visions in different sectors. Check out the interviews already published:
