Intel delivers APAC channel appraisal

This year signals 40 years since Intel was founded by semiconductor pioneers Robert Noyce and Gordon Moore.

It is unlikely Noyce or Moore could have ever imagined what a profound effect the development of Intel was to have on the past, current, and most likely future of the IT industry.

Indeed three years prior to the formation of Intel, Gordon Moore’s 1965 paper uncovered an important pattern in the history of computer hardware development.

Dubbed Moore’s Law, the paper covered everything from processing speed to memory capacity and stated that the number of transistors on a chip will double about every two years.
A tall order.

Fast forward to 2008 in Thailand’s humid capital city of Bangkok and you will hear expectations from Intel which must make Moore proud to this day.

The annual Intel Solutions Summit (ISS) witnessed the gathering of the vendor’s leading channel members, executives and affiliated industry contingent.

Through a medley of executive keynotes and product breakouts sessions, Intel’s APAC partners were given a flavour of how Intel and the channel itself has performed, plus what is to be launched and expected from the channel moving forward.

An interesting starting point is assessing the difference in tone between Intel’s address to its channel partners at last year’s ISS in Auckland and this year’s in Bangkok.

At last year’s ISS, Intel seemed to acknowledge that 2006 had been a tough year for the firm, but a packed future product roadmap would see Intel emphasise its dominant position over the coming couple of years.

The tone in Bangkok was very much a fulfilment of last year’s ethos.

Intel continues to follow its “tick-tock strategy” where it attempts to year-after-year alternate between releasing next generation silicon technology and new microprocessor architecture.

Intel was in Bangkok to discuss itself and its partners, but recent news of AMD, its closest rival, posting a sixth consecutive quarter of loss would not have gone unnoticed at the firm’s Santa Clara headquarters.

Intel has certainly made a good fist of taking the initiative since last year, and the channel has been vital to its onslaught.

According to Tim Bailey, director of marketing for Asia-Pacific at Intel, the channel in APAC now represents 35 per cent of the vendor’s business in the region.

“The channel is fundamental to Intel’s strategy,” said Steve Dallman, general manager of the Reseller Channel Organisation at Intel.

“We don’t see a world without the channel. There is no better way to get in touch with small businesses. There are 160,000 plus people in our channel membership. The channel has the ability to bring new product face-to-face with new customers and not only tell them about it, but show them how it works.”

Dallman hailed 2007 as a record-breaking year for Intel after it shipped 170,000 more server CPUs than the previous year, 300,000 more mobile CPUs and overall a made a colossal 1.5 million more CPU sales than in 2006.

He also noted that the channel was outstripping direct sales for its 45 nm offering.

The services opportunity ranked high on Dallman’s priority list.

“The channel has always done well as it has the one-to-one relationships with customers. We are coaching the channel to help them get into the services business. Being able to provide these services will mean the channel can make more money and the customers will benefit too.”

“You can integrate a system, sell it to a customer and you feed your family once. With services you get a monthly fee and are able to feed your family every day,” added Dallman.

Faster, further and differentiated. These were the three key messages to the channel from Tom Rampone, vice president and general manager of the Channel Platforms Group at Intel.

“The channel is Intel’s biggest customer worldwide and has been for several years,” said Rampone. “The channel is now going faster and reaching further than ever before.”

Rampone is tasked with ensuring the channel has the products it needs to succeed, and guiding them through Intel’s ever expanding product stable.

“We are excited about the product portfolio we have for our channel. This year everyone is focused on the 45 nm and demand has been extremely high. Our channel has also done a great job of delivering the Intel vPro technology to the SMB market,” he said.

“In Q2 and Q3 we will be launching the Eaglelake and Montevina platforms. We are also introducing the Intel Atom processor in Q3, with the Nehalem products launching in Q4.”

No shortage of pipeline activity from Rampone’s camp, but the challenge for resellers centres around ensuring they are skilled up on the flow of products coming from Intel’s active R&D department.

When CRN asked Rampone how Intel gets the channel up-to-speed on new releases, he responded, “It is a lot to absorb, but our channel is incredibly flexible and nimble, so if anyone can get their head round it, our channel partners can.”

Services and mobility were two areas Rampone was also particularly keen for the channel to reach further into.

“We are making our platforms more manageable and we are encouraging our customers to build services around the products. There will be channel value-add through platform extension services and hosted tools.”

News of fresh services opportunities is always music to the ears of the more proactive resellers.

According to Rampone, this is not only an opportunity for Intel’s larger partners, as its smaller channel players can also board the services gravy train.

However, one opportunity Rampone was almost disappointed with is the channel’s performance in the mobility space.
The desktop champion for so long, Intel is alive to the opening in mobility.

“You all know how excited Intel is about mobile and we know that the channel has not been able to get as involved in mobile, but we will be launching new mobile platforms for the channel.

We will also continue to focus on standardising our mobile platform,” said Rampone.

Navin Shenoy, vice president and general manager of Asia-Pacific sales and marketing at Intel, said, “Every year we bring out something new and we continue to focus on staying on top of that. This will drive our leadership and the channel can ride these transitions quickly. The channel needs to evolve and take advantage of new technology. Our relationship with the channel goes back 40 years, as does Intel. We have a long history of doing business with the channel.”

Shenoy used this year’s ISS to hail the continuing importance of the internet, which will drive the future adoption of what Intel is coining NetBooks or
low-cost computing.

“The driver for Intel and the industry is the internet. Last year we crossed the one billion connected computer worldwide mark,” he said. “The internet is going mobile and people want the internet in their pocket. Notebooks will out ship desktops in early 2009.”

Shenoy said that notebooks are also pulling in the first-time buyers, with growth rates of over 100 per cent year-on-year.

“Notebooks are getting smaller and smaller and we have introduced the second generation of our NetBook. It is all about the internet and for us it will appeal to people as a second or third device for adults or a device for children,” he said. “Rich Creek 2 is a motherboard designed for a notebook and that product will be in pilot for the second half of this year.”

Amongst all the talk of mobility and NetBooks, Intel reminded its channel that the desktop space is still alive and evolving.

“We have introduced our vPro technology and in2008 we are enhancing vPro with hardware disk drive encryption.”

So Intel seems pleased with its progress since 2006.

It was once said that in business, the competition will bite you if you keep running; if you stand still, they will swallow you.

In recent years it felt like AMD might be having a bigger nibble than it had previous and Intel knew that. Intel has upped its game in its ruby anniversary, and AMD’s recent struggles aside, has laid out a product roadmap which suggests the next forty years could be equally affluent.

Trevor Treharne