With Intel’s NUC Exit, Longtime Partner ‘Ready’ To Help Fill Mini PC ‘Void’
While Simply NUC got its start as an Intel NUC systems integrator and value-added reseller, the company has evolved to designing its own mini PCs that are sold through the channel. ‘We’re just shifting orders over from what we ordered from the distributor to what we’re ordering from our ODM,’ Simply NUC CMO John Deatherage says.
A longtime reseller of Intel’s NUC mini PCs said it’s “ready” to address the “void” left in the market by the chipmaker’s exit from the computer business with the reseller’s growing OEM operation.
While Simply NUC started in 2015 as a systems integrator and value-added reseller of Intel’s NUC mini PCs, the Round Rock, Texas-based company has shifted a significant portion of sales in recent years to mini PCs designed in-house, said John Deatherage, the company’s CMO, in an interview with CRN.
[Related: Intel Loses Global Sales Leader For $9B Network And Edge Group]
“We believe that we’re ready for the training wheels to be taken off so we can ride the bike,” he said.
Simply NUC is among several mini PC vendors looking to fill what Deatherage called a “void” in the PC market created by Intel’s announcement last week that it plans to exit the NUC business. The marketing executive added that Intel’s channel partners will feel the brunt of the chipmaker’s move.
“This whole announcement is going to have a pretty heavy impact on the channel, because […] that all went through the channel,” he said.
One solution provider executive told CRN he was dismayed by Intel’s abrupt decision to close the NUC business because his company had started selling NUCs in the past several months after the chipmaker made a big marketing push celebrating the business’ 10-year anniversary in December.
“It just shows such a disregard for the people who brought them here: the channel,” said Erik Semmel, vice president of sales at TAB Computer Systems, which was also impacted by Intel’s recent decision to close its prebuilt server business.
Semmel said he would find the situation more acceptable if Intel had given partners a heads up, took a longer, phased approach to exiting the business and sold it to another company.
“They thought so little of the channel that they wouldn’t even do that,” said Semmel, whose company will now have to switch mini PC vendors before Intel discontinues NUC products in less than two months.
Could Intel Sell Its NUC Business?
Deatherage said Simply NUC will continue to get Intel NUCs from the chipmaker for now, although it may not be for long. An Intel spokesperson told CRN last Thursday that partners can order NUC products through distributors until Sept. 1 and that final shipments will happen at the end of that month.
One development that could extend the life of the NUC product line is if Intel sells or transfers the business or its assets to another company that would sell products based on Intel’s mini PC designs.
Deatherage thinks that’s possible, and his hypothesis is based on Intel’s statement that the company would shift its strategy to “enable our ecosystem partners to continue NUC innovation and growth.” A potential buyer could be an ODM, like Pegatron, that manufactures systems for vendors, the CMO said.
“That other partner that comes along [and buys the NUC business] maybe fills that gap and nobody blinks, but we’re going to go through a period of uncertainty where we just don’t know,” he said.
If Intel sold the NUC business, it would be similar to when Intel shut down its prebuilt server business earlier this year and sold it to Taiwan-based MiTAC, parent company of server vendor Tyan.
“I think Intel is trying to get super focused on their processors and their process technology,” Deatherage said, referring to Intel CEO Pat Gelsinger’s comeback plan that calls for significant investments in advanced chip technologies and a revitalized contract manufacturing business called Intel Foundry Services. “I think the foundry thing is just massive for Intel right now, and they want to be super laser-focused on a couple of big bet areas versus too many others that they might call distractions.”
When asked if Intel may sell or transfer its NUC business to another company, an Intel spokesperson told CRN last Thursday that it’s “focused on ensuring a smooth transition with our current partners and customers” and is not “commenting on further actions at this time.”
The Intel representative added that it “will provide further details on continuity plans” by Aug. 25.
If Not Intel NUCs, Simply NUC Has Alternatives
Regardless of whether Intel’s NUC product line continues elsewhere, Deatherage said Simply NUC is ready to serve more customers with its mini PC designs and value-added services.
Simply NUC first expanded beyond selling Intel NUCs with fanless and long-life mini PCs, which were requested by customers but not addressed by the chipmaker’s product line, according to Deatherage. These systems were built using motherboards from other vendors and a custom chassis it designed.
The company then took the steps to become an OEM after Intel began experiencing severe component shortages at the beginning of the COVID-19 pandemic in 2020, the CMO said. This involved Simply NUC designing not just the chassis but also the motherboard and forming relationships with ODMs to manufacture the components, which allowed the company to use both Intel and AMD CPUs.
But despite the move to build custom designs, Intel NUCs still account for more than half of Simply NUC’s mini PC sales, Deatherage said, but he believes the company can handle the transition it and other partners will likely have to make in the coming months.
“We’re just shifting orders over from what we ordered from the distributor to what we’re ordering from our ODM. That’s the thing we have to coordinate here,” he said.
One Intel NUC buyer, edge computing and virtualization vendor Scale Computing, has already committed to using Simply NUC’s in-house Topaz mini PC design along with Lenovo’s M90Q mini PC for its HE100 hyperconverged infrastructure edge appliances, which previously relied on Intel NUCs.
What isn’t changing with Simply NUC’s transition away from Intel NUCs is the value-added services the company has long provided for mini PCs, according to Deatherage. These services include customer support, computer imaging, BIOS customization, custom configuration, peripheral bundling and logistics.
“We believe our main value-add is the customizations and services we wrap around it,” he said.
Simply NUC Hopes to Build Out Channel Presence
Before Intel announced its exit from the mini PC business last week, Simply NUC was already in the process of ramping up relationships in the channel. These relationships include distribution agreements with TD Synnex, Ingram Micro, CDW, Insight Enterprises and Bluestar.
“It’s an excellent model where we do quick-turn configure-to-order with no minimum order quantities on all of our systems,” said Eric Thompson, a former employee in Intel’s channel organization who is now Simply NUC’s channel manager.
Thompson said the model has been working out for all parties so far.
“Partners love it since they get to control the configuration needed to suit their end customer requirements, distributors love it since they don’t have to tie up inventory capital, and the end customer gets exactly what they need in a matter of a few days,” he said.
Deatherage said he didn’t expect Intel to abruptly announce its exit from the NUC business last week, but he knew the day would eventually come. He based this prediction on his past experience as a marketing employee at Intel, where he helped start the NUC business around the same time he played a role in the shutdown process for Intel’s desktop motherboard business in the early 2010s.
“It just didn’t make sense for Intel to do desktop motherboards anymore. Same thing with server motherboards. Same thing with server systems. Well, guess what’s next? The NUC systems,” he said. “I don’t think it’s Intel saying those things are bad. It’s just Intel saying, ‘Our job is done. It’s enabled. It’s time for everyone else to take it and run with it.’”