The Future of Manufacturing: Hardware as a Service

Brian McCarson, Vice President & General Manager of the Intel NUC Group, sat down with Omer Brookstein, Xyte CEO, at InfoComm 2023.

At the InfoComm conference in Orlando, Brian McCarson, Vice President & General Manager of Intel NUC Group and Xyte CEO Omer Brookstein, laid out a fascinating vision of where the hardware industry is today and where it’s going tomorrow. They also touched on NUC’s strategy for developing new as-a-service business models and how these help manufacturers build sustainable customer relationships and make data-driven decisions in product roadmaps and sales processes.

Omer started by discussing how system integrators, managed service providers, OEMs, and end users are moving towards a pay-per-use payment model for devices and services. The usage-based pricing model is nothing new, he emphasized. Kind of like we all pay water, electricity, and software bills based on actual consumption – without buying the water company. And kind of like we’ve all been paying for SaaS and other cloud-based products for the last two decades.

What’s NUC Got to Do with It?

Brian echoed Omer’s sentiment with regards to usage-based edge computing. From a brand perspective, Brian zeroed in on how NUC is making the leading and most prolific mini PCs on the planet – “that hardly anybody's ever heard of because it's not about us. It's about enterprise businesses and how we can deploy for them the ultra-reliable, ultra-high performance computing that they need at the edge in a very small form factor and at a really great price.”

What counts in today’s edge computing market, Brian emphasized, is customer experience. Because as much as Intel and other manufacturers are “…focused on hardware, that's not what most enterprises are focused on. Enterprises are focused on the value that they can provide to their customers.” Yet despite this, under existing procurement paradigms, enterprises still need to be concerned about hardware. This is what’s driving, in Brian’s opinion, the shift to usage-based pricing models – the need for enterprises to be able to focus on their core competencies, rather than worrying about hardware management.

The key to speeding the shift, Brian contended, is hardware manufacturers accepting – as Intel has accepted – that “it's not about me. Hardware vendors have to be willing to say ‘I just care about the experience. Pick your hardware. I’ll make it easy for you to go procure it. When it breaks, I'll replace it for you. When you're done with it and you need to have it recycled, I'll do that in a sustainable way.’” And this, he concluded, is exactly where NUC as a service is headed – enabling enterprises to not worry about hardware, and just get the services associated with it. And they do this through key partners, like Xyte, “…that are able to make that ecosystem flourish while we remain the enabling engine behind the scenes.”

But There’s a Hitch

According to Brian, “one of the problems in the current model is that once we ship a product – the second it leaves the warehouse - we have no visibility. We don't know how it's being used, we don't have any relationship with the customer, there's no way to upsell services to the customer, and there’s not even a way for the customer to ask for more services, if he or she wanted to.”

By way of example, Brian pointed out a nearby monitor. “We live in a connected world. Yet whatever OEM produced that display over there is totally hidden. The manufacturer lost complete touch with the display the second it left the warehouse.” What could this manufacturer learn from the usage data flowing from the monitor? How could they design better products based on that data or better support their customers?

This is the hitch that Brian and Omer were referring to – the disconnect between manufacturers and their channel partners or end users. A solution like Xyte helps manufacturers develop long-lasting and sustainable customer relationships by offering deep visibility and understanding of both the value chain and the customer experience. This enables them to better tailor their offerings and support to meet customer needs.

This model is not new, Brian emphasized. “It's already been solved. When you call your mobile provider to tell them you want to add a feature to your service plan, you don't go to the provider’s store and they don't roll trucks to your house. Consumers would never accept that. The mobile phone industry figured this out. They moved to managed services, over the air updates, containerized application management, really clear APIs, and the ability to, within seconds, go online and upgrade your services.”

Today, Brian and Omer concluded, we’ve got the technology and experience to make this scenario not only realistic for hardware providers, but also highly profitable.

The Bottom Line

The discussion between Xyte CEO Omer Brookstein and Intel NUC Group's Vice President Brian McCarson shed light on the transformative potential of the HaaS (Hardware as a Service) model.

Yet to facilitate the shift to HaaS, manufacturers need to prioritize their customer experience and learn to not only focus on the hardware that drives it. As more and more enterprises seek this as-a-service approach for devices and services, Xyte will play an increasingly vital role in fostering strong manufacturer-end user relationships by offering deep visibility into the value chain and customer experience.

Though challenges exist, other industries (like the mobile phone industry) have already demonstrated the viability of HaaS. With the right technology and partnerships, HaaS has the potential to revolutionize the market, benefiting manufacturers and customers alike.

Click here to watch the full conversation.

Related Resources

• Volvo & Xyte: How the Shift to as-a-Service Business Models Results in New Revenue Streams