Solution Providers Help Customers Navigate Complex AI PC Environment

AI computing is seeing significant interest and support across the channel, and solution providers will play a key role in helping customers navigate a complex environment.

Since the first AI-enabled PCs began shipping last year, major technology vendors ranging from Intel and AMD to Dell Technologies, HP Inc. and Lenovo have vowed that the new device category would represent a turning point and a new direction of growth for the client PC market.

Many solution provider executives share this optimism, including Future Tech Enterprise CEO Bob Venero, who believes the AI ​​PC category presents a “huge opportunity” for the channel because it will eventually become the norm for personal computing.

“AI computers will be the standard. Eventually, I think, there will really be no distinction between AI computers and non-AI computers because AI will be integrated into everything that companies will do,” he said.

(RELATING TO: CRN’s 2024 AI Special Issue)

The emergence of this new category of devices comes at a critical time: Devices purchased during the pandemic-fueled buying rush of 2020 and 2021 are nearing the end of their expected four-year lifecycle. Microsoft Windows 10 is set to be discontinued in about a year, forcing many businesses to upgrade their PCs to meet the more powerful hardware requirements of Windows 11.

When you consider the zeitgeist of this new AI era, it’s no surprise that AI PCs are seeing a lot of interest in the channel. But it’s still early days, and sales in this new market are more complex and heavier-lifted than traditional PC sales as solution providers help customers understand how AI PCs can best benefit them.

“If partners understand that you need to focus on the business output of that AI computer for your customer’s environment, the opportunity arises and if you can articulate that, you’ll be in good shape,” Venero said.

The first generation of AI computers has been on the market for several months now, and a second wave of more capable machines is starting to hit the market.

While the industry has been buzzing about AI computers for about a year, analysts predict that AI computer sales will start to gain some momentum in the second half of this year, but will gain significant momentum in 2025.

According to research firm IDC, AI-enabled computers are expected to “lead only modest personal computing growth” through 2024.

But with the PC market just starting to recover this year, the company predicts that AI-based PCs will go from representing one in five PCs shipped in 2024 to nearly two in three PCs shipped by 2028, leading to higher average selling prices.

Solutions provider executives believe the AI ​​PC category will be a game-changer for businesses, but they will need to help customers navigate the problems that make early adoption difficult, whether it’s finding compelling use cases or justifying higher prices.

x86 Support, Availability Crucial for AI PC Traction

One issue that may have impacted early adoption of AI PCs was Microsoft’s decision in June to launch its newly branded Copilot+ PCs with Qualcomm’s Arm-based Snapdragon X processors rather than x86 chips from Intel or AMD.

This has added another layer of complexity to the product category, as solution providers now have to take a closer look at the underlying hardware and help customers make a choice: Should they opt for the Arm-based Copilot+ PCs that are available now, or should they wait for the broader availability of new x86-based systems featuring Intel and AMD chips and meeting Microsoft’s Copilot+ PC performance requirement, which requires artificial intelligence computers (TOPS) with a neural processing unit that performs at least 40 trillion operations per second.

The x86-based systems released earlier this year do not meet this target.

“The normal message would be, ‘Hey, future-proof your hardware. You’re going to buy the hardware today. You’re going to be future-proof,'” said an executive at a major U.S. distributor who asked not to be identified to speak candidly about the challenges facing broader AI PC adoption.

“Then this Microsoft (Copilot+ PC designation) comes along and says, ‘Wow, wait a minute, am I really future-proofed because my laptop didn’t make TOPS 40?'”

“We’ve seen incredible energy and acceleration with Copilot+ PCs. Our customers are telling us that the performance and battery life are exceeding their expectations,” Microsoft said in a recent blog post.

As new x86 chips enter the market, the question becomes how many AI PCs will be widely available in the commercial market in the near term, says Megan Amdahl, senior vice president of customer experience and North America COO at Chandler, Ariz.-based Insight Enterprises. To date, allocations have been more focused on consumers, Amdahl said.

“It will be interesting to get clarity on how much will be allocated to consumers and businesses in the next month or two,” he said.

Software Ecosystem Plays Crucial Role in AI PC Adoption

One of the biggest challenges critical to the early adoption of AI computers has been the need to find compelling use cases, including applications that can unlock new capabilities using the new chip architectures that power these computers.

“One of the things we’re watching closely at Insight is what other software comes out that really requires 40 TOPS for performance. Because Copilot+ is great; it’s just how many other (applications) are there that people can take advantage of (for better productivity, collaboration, or graphics)?” Amdahl said.

When vendors first started talking about the AI ​​PC concept last year, there were few demonstrable use cases and even fewer applications that people could use.

But vendors like Intel and HP have been working for the past year to enable and promote ISVs that develop so-called “killer apps.”

Intel, for example, is working with more than 100 ISVs on more than 300 AI-powered features that will benefit its Core Ultra processors. The features include AI-powered anti-phishing by BufferZone, accelerated data analytics by Microsoft’s Power BI, AI-powered presentations by Canvid, and AI-powered deepfake detection by McAfee.

At a summer event, HP highlighted several ISVs that are making AI PCs “real and tangible,” in the company’s words, with applications that take advantage of the PC’s underlying chipset. These applications include business intelligence platform Polymer, photo editor Luminar Neo, and presentation maker Beautiful.ai.

The expanding software ecosystem underscores how AI-enabled PCs present a “huge opportunity” for channel partners, according to Alex Cho, president of personal systems at HP in Palo Alto, California.

“This is not a device opportunity. This is a device/solution/software/service opportunity,” he said. “And so for our partners to be able to offer this solution to our customers, it means an expanded shopping cart. It seems very transactional, it seems very mechanical, but it means they can offer a much broader solution set to our customers.”

Solution Providers Wait to See How Pricing and Security Issues Play Out

AI PC use cases continue to grow, but solution providers are also watching how pricing evolves, as many of the early devices come with a need to justify higher price tags, Insight’s Amdahl said.

But Amdahl said he has received indications that prices could be lowered to make AI-based computers easier to sell to a wider range of customers.

“To the extent that this really comes to fruition, when OEMs are doing production, then you’ll see a lot of IT teams saying, ‘I’m ready for the future. If I have to choose (between an AI PC and a regular PC), I might go with the AI ​​PC,'” he said.

According to Michael Affeldt, senior vice president of sales for ACP CreativIT, based in Buffalo Grove, Illinois, there’s another hurdle solution providers face in helping potential AI PC customers overcome: concerns about data management and security.

“These are the things that make people reluctant,” Affeldt said.

These concerns became even more apparent in May when Microsoft announced Recall, a feature expected to be a key feature at the launch of its Copilot+ PCs, which would allow users to search for things they’ve previously seen on their screens using natural language queries.

But security and privacy experts were quick to point out that since Recall searches are run against a central database of screenshots taken from a user’s desktop every few seconds, the feature could allow threat actors to “automatically collect everything you’ve ever looked at in seconds.”

Days before Copilot+ PCs were set to launch, Microsoft delayed Recall to improve the feature’s security and privacy protections, making it optional, requiring customers to use Windows Hello authentication to access it and encrypt the search index database. The feature is now expected to be available for external testing in October.

“Security remains our top priority,” Microsoft said in a recent blog post on the subject.

As companies grapple with the security implications of new AI features, Affeldt sees the adoption of AI computers as inevitable as the replacement of computers.

“Have you seen surfers just sitting on their boards out there in the waves?” Affeldt said, recalling something he told his team recently. “That’s where we are right now. The waves are coming, and those waves are Windows 11-compatible devices, AI-compatible devices, and (post-COVID) PC refresh.”