EMC Corp. (NYSE: EMC) has a lot going for it with dominance in storage and with its super-majority control of VMware Inc. (NYSE: VMW). Unfortunately, the tech giant is no longer growing at an endless and boundless rate, now that the laws of large numbers and size have caught up to it. After having spent about two years on our list of dividend sinners, EMC finally has decided to get with the program and issue a dividend and a large stock buyback plan.

The initial dividend is being set at $0.10 per share per quarter, which will generate a 1.7% dividend yield, based on the $23.66  most recent closing price. This $0.40 annualized payment compares to earnings expectation of $1.86 per share for this year, and that in turn comes to a payout ratio of about 21.5% of adjusted earnings before considering GAAP measures and considering international capital.

What investors are likely to cheer even more is that EMC’s board of directors is greatly going after share buybacks now. EMC just increased its buyback allowance from $1 billion in 2013 to $6 billion between now and the end of 2015. More importantly, EMC said that it would repurchase $3.5 billion of its common stock by the end of the second quarter of 2014, if you include the $500 million the company already has spent year to date. That comes to a plan of about $583 million per quarter on average, which comes to about 23 million shares per quarter (assuming $25 stock price).

As far as where the capital is coming from, outside of its massive cash on hand, EMC also filed an open shelf registration statement with the Securities and Exchange Commission that will be to sell debt. With very little debt and with much capital likely outside of the United States, the bond offering will be similar in nature to what Apple Inc. (NASDAQ: AAPL) recently issued.

EMC has finally decided to listen. We have been hounding the company in our list of dividend sinners, strong companies that can afford to easily pay a dividend but refuse to do so. Other companies should pay attention as well because EMC shares are up about 5% at $24.90 after the news, against a 52-week range of $21.45 to $28.18.

Also, there is something interesting here worth noting. 24/7 Wall St. has always admired higher dividends more than share buyback plans because dividends are a long-term commitment and buybacks may be nothing more than opportunistic, based on a share price of the day. As it turns out, an ETF analysis shows that one strategy clearly beats the other in the game of returning capital to shareholders. You might be surprised.

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