'Not science'

Dell's longtime rival HP started to enter the software market in mid-2005. Its software business revenue grew 14 percent year-on-year in the fourth quarter of last year with an operating margin of more than 27 percent, according to the company.

Swainson estimated a reasonable scale for Dell's software group is somewhere around $5 billion, but he refused to predict when the company could hit the target.

"It's not science, but there is some benchmark if you look at the software business of HP," said Swainson.

Industry insiders said Dell's ailing PC business made the growth of the software unit more urgent.

Data from research company IDC showed Dell's global PC shipments saw a decline of more than 10 percent in the first quarter of this year. The company's shipments in the United States dropped by 14 percent.

Currently, Dell software's major target customers are in the US, Australia and West Europe.

Markets such as China are not yet being explored because expanding business in non-English speaking countries could cost extra money and energy.

As the world's top growing information technology market, China should generate $100 million in revenue for Dell software in the future given the company's current portfolio, although the company has so far received less than $10 million in revenue from the China market, according to Swainson.

Dell has to translate the products to feed demand in Asian countries and, in some cases, the company has to re-engineer the products and then set up a brand new sales infrastructure, according to Swainson.

"We have got a lot of work to do to localize the company's software products in China. For example, the translation and sales infrastructure," he said.

"Asia-Pacific makes up a very small percentage of our business so we see great potential to grow in China, Japan and South Korea."

Dell software received about $50 million in revenue from the Asia-Pacific region.

"It may be not a very good number but it should be way bigger in the future," said Swainson.