CES 2018: We talk To Intel's John Deatherage about Hades Canyon and the future of NUCs

Intel's NUC and Compute Cards might look small at first glance but the future of both products is one filled with big ideas. Amidst the chaos of this year's CES in Las Vegas, we sat down for a quick chat with Intel's John Deatherage to talk about the Hades Canyon NUC and the exciting things it could lead to.

A few years ago there was some talk of NUC being one of the fastest growing segments of your business. Is that still the case?

Deatherage: "This year we just finished a really good 2017. Without getting too specific, this was the first year we shipped over one million units of NUC. That represented about a 10% growth year on year."

"I think general knowledge is that the PC market is declining by 5% to 7%. In a declining market we're seeing a few growth areas. Mini PCs, is one of them and enthusiast gaming machines is definitely another area. The Hades Canyon is kind of a nice mix of both."

Outside of the obvious enterprise deployments and applications, what kind of customers and markets are gravitating towards the NUCs and Compute Card?

"I'm amazed at the number of places and creative places I see NUC being used, [usually] where people desire compute [but] needs something small. The embedded markets are just all over the place: digital signs, kiosks, vending machines, drones, robots, schools, hospitals. That's where I think it's helping us fuel the growth [and the] areas where we're truly seeing [significant] expansion."

"I would say a lot of what helps our growth is some of those new areas, conference rooms, various things like that where there weren't computers before and you didn't want a honking tower, so something small, more like this than that. This is pretty easy to hang on the back of a monitor or hide somewhere where it's not looking cluttered."

"The consumer that buys most of our NUCs is a DIY guy because most of our NUCs are kits, which means they don't come with the memory storage or OS and you need to have some degree, not a lot, but some degree of computer savvy in order to build up a model."

"For the first time we are starting to ship some system level NUCs as well to allow us to maybe grow there a little bit where consumers could buy a NUC that's ready to boot out of the box."

How do you feel about the form factor of the unit? Is there much room to go smaller? Is there any point in doing so?

"A lot of our customers tell us, "Don't change anything."

"In fact, they get upset when we move this guy...", he says as he points to one of the ports on NUC, "...a millimeter to the right."

"Whatever we do, we want to make sure it's scalable. We don't want to make something that only will take a Celeron or a Pentium and won't scale up to i7. Really, the initial goal here was to build the smallest possible motherboard fully scalable from Atom up to Core i7. What we've seen so far is this shape and height just resonates. Changing it doesn't feel right to me. We had to change it for Skull Canyon and Hades just because we decided we were going to go up the performance."

"If we could figure out how to do 100 Watts in this, hallelujah, but I don't think physics is going to let you do that. You're just going against the laws of physics at that point. We have explored form factors though, for sure, that we positioned this being a different product from the Compute Stick, you probably remember that."

"Now, the Card, the jury is still out [but] NUC, I think, is pretty stable. We're going into our sixth year of production right now. For the Compute Card, we're just trying it out. We may find out that this form factor doesn't resonate, in which case, yeah, we would change it. We would tweak it to try to make it to where it hits a sweet spot. This is feeling pretty good so far."

"We were pretty excited about Stick too and it didn't take off, and so this is our next attempt. Innovation is what we do in my group and a form factor is kind of the way we do it and small has kind of been our trend, as far as the delivery."

Can you give me any specific insights into the popularity of NUCs and Compute Cards within Australia?

Australia is our top country in what we call the APJ region. It has been for years. We're seeing it resonate with consumers and commercial usages. One pretty high profile one that we can talk about is McDonald's, so pretty much all of McDonald's, the walk-up kiosks that you see: NUCs are driving those, and so NUCs have been very popular in Australia."

"Roughly speaking, 30% to 35% of our APJ volume is in Australia. APJ is not our biggest geo, Europe geo is actually our biggest. The numbers are fairly small in APJ, but that allows it to be one of the fastest growing geos. I could just say APJ is our fastest growing geo, but it's a smaller number, and then within APJ, Australia, Japan, Indonesia, India tend to be the top countries. China is pretty big for us as well, but you kind of think of that as a different geo."

You've talked about you're mostly happy with the form factor and customers are responding well to the NUC design. What do you sort of see as the next big hurdle in what you're trying to overcome with these products

"Discrete graphics."

Deatherage points to the Hades Canyon NUC on the table in front of us.

"We haven't started shipping this yet. We're not sure that it's going to be a home run. We want it to be, we think it could be. You guys are writing great things about it and I'm excited about it. This is the first NUC coming to market with discrete graphics. Is it the right graphics? Is it powerful enough? Is it flexible enough for what people need? We don't know. If it is, you could anticipate us doing more NUC product lines around discrete graphics."

Intel has been showing off and talking up a lot of their tech relating to AI, neural networking and quantum processing at your booth this week. What possibilities do you think those technologies present for your category?

"There's a number of different engines that are being created around those. We actually have a lot of conversations on Compute Card. Right now, we're just going down the traditional Intel path: let's see if it's used, but what about having a Movidius chip in here that could do AI paired up with the processor? We're in exploration of those ideas right now."

"There are a number of initiatives going on at Intel that I think could potentially end up in small form factor, because they tend to be low power and the size that you get them in real estate becomes a premium, obviously, on these tiny little boards. You see the Movidius Compute Stick today and you could potentially see that kind of technology ending up in something like a Compute Card. We're exploring those things as well."

"Right now we need the bread and butter stuff that hits the volume space, but growth and going in new directions is something we want to lead in as well, so we're absolutely looking at those types of technologies."

For the full run-down on everything that happened at this year's CES in Las Vegas, click here.

Disclosure - Our coverage of CES 2018 was sponsored by Intel, Belkin and Alcatel - who collectively covered the cost of our flights and accommodation.


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