Intel: Desktops, Tablets Key Growth Drivers For Partners In 2014

Intel's Maurits Tichelman says the PC is far from dead and solution providers shouldn't believe the doomsday forecasts.

Tichelman, vice president and general manager of the worldwide reseller channel at Intel, told an audience of elite channel partners at this week's Intel Solutions Summit in Las Vegas that some PC segments will see 20 percent growth this year. He also said Intel was relying on channel partners to sell one-third of the 40 million Intel-powered tablets it expects to sell in 2014.

"We continue to hear about the death of the PC. But as Intel refreshes its K series SKUs, we expect 20 percent growth in the high-performance segments on the client side," Tichelman said. Ninety-five percent of these content-creation, media, enthusiast and gaming PCs were expected to be sold through the channel, he added.

"So when people talk about the death of the desktop, it is not happening as far as we can see," Tichelman told attendees. He added that 40 percent of the desktops powered by Intel processors are sold through the channel and new innovations and form factors such all-in-ones, two-in-ones and NUC, Intel’s small-footprint PC, are key sales drivers.

[Related: System Builders Ask Intel: Where Is Our Future? ]

But Intel's biggest bet on the channel in 2014 is relying on partners to sell tablets, a market Tichelman said is rich with untapped profits. "We have a big, audacious goal of selling 40 million tablets this year. One-third of those tablet sales will be through the channel," he said.

Intel's smartphone and tablet division, which reported a $929 million operating loss for its first quarter, shipped 5 million tablet processors in the same time period. Intel, Santa Clara., Calif., was on track to meet its 40 million unit goal, according to Tichelman. Market-research firm Gartner forecasts 270 million tablets will be sold in 2014.

"Intel wants to make sure the channel is ready for tablets. Last year, we admit we were late to the party. Far too late," Tichelman said. "But this year we are saying we are committed and going to catch up. Second quarter last year we had three tablets available from three of the ODMs. Now we are in the game. At the end of last year we had more than 64 tablet designs supporting both Windows and Android."

One Intel Solutions Summit attendee said he was skeptical his company's customers would buy any tablets -- let alone Intel tablets -- at the pace Tichelman hoped.

"Our customers just aren't buying tablets," said Troy Spengler, president of The Computer Store, a Minot, N.D.-based Intel Platinum partner. "Even if there was demand, the margins aren't there for us to put a lot of sales focus on them."

NEXT: Intel Partners 'Outperformed The Larger Market' ​

The Internet of Things market holds great profit potential for the channel in the year ahead if partners are willing to transform their businesses, Tichelman told Intel Solutions Summit attendees. He pointed to opportunities in retail, health care and manufacturing where myriad smart devices work together to help businesses keep tabs on inventory, customer analytics and foot traffic.

The channel also has a unique role in driving server sales, he said, an area of growth for Intel in 2014. "The great thing about servers for the channel is that they require consultive selling -- something the channel does best," Tichelman said. "We are seeing server sales driven by cloud, high-performance computing, telecom, enterprise and SMB. We need the channel to drive additional growth."

The Intel channel, Tichelman added, outperformed the larger market last year. "If you look at 2013, where the market had been stagnant in many areas, the channel did better than the rest of the industry. That's because the channel has the capability to offer customization, localization and increased value-add."

For the most part, Intel partners attending the Intel Solutions Summit shared Tichelman's enthusiasm when it came to growing their business into new growth areas such as Internet of Things, the rise in compute needs associated with big data trends and mobile.

’Intel is putting all the pieces together. This show really illustrates how the Intel ecosystem can transform the channel from data center all the way to smart devices like signage in a retail store," said Scott Silverstein, global technical marketing manager at Englewood, Colo.-based distributor Arrow Electronics.

However, one partner, who asked not to be identified, said Intel's ambitious tablet and Internet of Things moves have the potential of distracting it from a road map focused on core Intel businesses such as high-performance computing and Xeon processors.

"Intel's Xeon road map looks good for now," said the partner. "But looking down the road, I see opportunities for Nvidia to compete with its GPU vector processors and possibly even AMD getting into the game -- if it can stop tripping over its own shoelaces."

PUBLISHED APRIL 24, 2014