Solution providers help customers navigate the complex AI-driven PC landscape

As AI computing continues to gain traction and support across channels, solution providers will play a key role in helping customers navigate this complex environment.

Since the first AI-powered PCs went on sale last year, major technology vendors from Intel and AMD to Dell Technologies, HP Inc. and Lenovo have been heralding the new category of devices as a turning point and a new growth vector for the client PC market.

Many solution company executives share that optimism, including Future Tech Enterprise CEO Bob Venero, who believes the AI ​​PC category represents a “huge opportunity” for the channel because it will eventually become the norm for PCs.

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

(RELATED: CRN’s 2024 Special Issue on Artificial Intelligence)

The arrival of this new device category comes at a key time: Devices purchased during the pandemic-induced spending frenzy of 2020 and 2021 are reaching the end of their expected four-year lifecycles, and Microsoft Windows 10 will be retired in about a year, forcing many businesses to upgrade their PCs to support the more advanced hardware requirements introduced with Windows 11.

Factor in the zeitgeist of this new era of AI, and it’s no wonder AI computers are attracting so much attention in this channel. But it’s still early days, and selling into this emerging market is more complex and difficult than selling traditional computers, as solution providers help customers figure out how AI computers can best help them.

“If partners understand that you need to focus on the business outcomes of this AI computer in the customer environment, and then you can clearly communicate that, that’s a good option for you,” Venero said.

First-generation AI computers have been available for several months now, and more capable second-generation machines are starting to appear on the market.

Although the industry has been turning up its nose at AI-powered computers for a year now, analysts predict that sales of AI-powered computers will begin to gain traction in the second half of this year and then gain momentum in 2025.

According to research firm IDC, in 2024, AI-powered PCs will only “drive moderate PC growth.”

However, with the PC market only just beginning to recover this year, the company forecasts that AI-powered PCs will account for one in five shipments in 2024 and nearly two in three shipments in 2028, which would translate into higher average selling prices.

Solutions executives say AI computing will become a game-changer for enterprises, but they will need to help customers address the issues that limited early adoption, 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 to launch new Copilot+ computers in June, powered by Arm-block-based Qualcomm Snapdragon X processors instead of x86 chips from Intel and AMD.

This has added another layer of complexity to the product category, as solution providers must now more closely analyze the underlying hardware and help customers make decisions about whether to choose the Arm-based Copilot+ computers that are available today or wait for the broader availability of new x86-based systems with Intel and AMD processors that meet Microsoft’s Copilot+ performance requirements, which require AI computers to have a neural processing unit that performs at least 40 trillion operations per second (TOPS).

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

“The normal message would be, ‘Hey, just future-proof your hardware. You buy your hardware today. You’ll be future-proof,’” said an executive at a large U.S. distributor who asked not to be identified so he could speak candidly about the challenges facing broader adoption of AI-powered PCs.

“Then Microsoft’s definition comes along (Copilot + PC) and I think, ‘Wow, wait, am I really future-proofed if my notebook doesn’t get to TOPS 40?'”

Microsoft said in a recent blog post: “We’ve seen incredible energy and momentum behind Copilot+, with customers telling us that performance and battery life exceed their expectations.”

As new x86 chips hit the market, the question is how many AI computers will be widely available commercially in the near future, said Megan Amdahl, senior vice president of customer experience and chief operating officer for North America at Insight Enterprises, based in Chandler, Ariz. So far, Amdahl said, allocations have been more consumer-focused.

“It will be interesting to see over the next month or two how much of the funding will go to consumers and how much will go to businesses,” she said.

The software ecosystem plays a key role in the adoption of AI computing

One of the key challenges to addressing the early adoption of AI in PCs is finding compelling use cases, including applications that can unlock new capabilities using the new chip architectures on which these computers rely.

“One of the things we’re really looking at at Insight is what other software is going to be out there that really needs 40 TOPS for performance. Because Copilot+ is amazing; just how many other (apps) are people going to be able to use (for better productivity, collaboration or graphics)?” Amdahl said.

When manufacturers started talking about the concept of AI computers last year, there were only a few examples of how they could be used and even fewer applications that people could benefit from.

However, over the past year, vendors like Intel and HP have been working to enable and promote independent software vendors that develop so-called killer apps.

Intel, for example, is working with more than 100 independent software vendors on more than 300 AI-enabled features that will leverage its Core Ultra processors. Features include AI-based anti-phishing from BufferZone, accelerated data analysis from Microsoft Power BI, AI-powered presentations from Canvid, and AI-powered deepfake detection from McAfee.

At its summer event, HP highlighted several independent software vendors that are making AI computers what the company calls “real and tangible” with apps that take advantage of the computer’s core chipset. Those apps include business intelligence platform Polymer, photo editor Luminar Neo and presentation creator Beautiful.ai.

The growing software ecosystem shows that AI-powered computers represent a “huge opportunity” for channel partners, said Alex Cho, president of HP’s personal systems business based in Palo Alto, California.

“This isn’t a device opportunity. This is a device/solution/software/service opportunity,” he said. “And so the fact that our partners are able to deliver this solution to our customers is an expanded shopping cart. It seems very transactional, mechanical, but it means that they’re able to deliver a much broader set of solutions to our customers.”

Solution providers are waiting to see how pricing and security issues will develop

As AI adoption in PCs continues to grow, vendors are also seeing price changes as many early devices face the need to justify a higher price tag, Insight’s Amdahl said.

But Amdahl said she has already received signals that prices could be lowered, making AI computers more accessible to more customers.

“To the extent that this actually happens, where OEMs are involved in manufacturing, then (there will be) a lot of IT teams saying, ‘Well, I’m future-proofing myself. If I’m choosing between (an AI PC and a regular PC), I can choose an AI PC,'” she said.

According to Michael Affeldt, senior vice president of sales at Buffalo Grove, Illinois-based ACP CreativIT, solution providers need to help prospective AI PC customers overcome another hurdle: concerns about data management and security.

“That’s what makes people reluctant,” Affeldt said.

These concerns were underscored by Microsoft’s May announcement of Recall, which was supposed to be a key feature of the Copilot+ computers when they launched, which was supposed to give users the ability to search for things they had previously seen on their screens using natural-language queries.

However, security and privacy experts were quick to point out that because Recall searches are performed against a central database of user desktop screenshots every few seconds, the feature could allow attackers to “automatically scrape everything you’ve ever viewed in a matter of seconds,” as one expert explained.

Days before the Copilot+ PCs were released, Microsoft delayed Recall to improve the security and privacy of the feature by making it optional, requiring customers to use Windows Hello authentication to access it, and encrypting the search index database. The feature is expected to be available for external testing in October.

“Security continues to be our top priority,” Microsoft wrote in a recent blog post about the issue.

Given the security challenges of new AI features, Affeldt believes the introduction of AI PCs is as inevitable as the coming PC modernization.

“Have you ever seen surfers just sitting on their boards after a break?” Affeldt said, recalling something he told his team recently. “That’s where we are now. The waves are coming, and those waves are Windows 11 devices, AI-enabled devices and the (post-COVID) refresh of computers.”