How Intel/Altera Will Impact the Channel
The likely effects of the Intel/Altera merger are far-reaching, but there are important themes that cross channel lines and speak to the continuity of industry trends. The viewpoint from the independent distribution channel, for example, is unique. Different channel partners are, naturally, anticipating different changes to their supplier-distributor relationships and likely will see increases in service demands for customizing programmable chips, as EPS’s Barbara Jorgensen recently reviewed.
While Intel is seeking to increase its market diversification, independent distributors see their core strength residing in just these types of diversified and customized solutions and services that will come out of the merger. By looking at the Intel/Altera merger from the independent perspective it’s clear that some patterns still hold: there is a longstanding demand for agility, customization, and still critical focus on solution-based services that can balance off-the-shelf chips with unique requirements.
Todd Traylor, vice president global trading for Smith & Associates, a leading independent distributor, spent some time this week talking about the merger. Traylor was clear in pointing out that Smith remains focused on the channel effects of the Intel/Altera merger from the customers’ perspective.
“Smith’s focus is on the customer and how these consolidations will impact them,” Traylor said. “We don’t have a position on whether the consolidations are good or bad, but we see them as disruptive and good cause for customers to make provisions for alternate sources.” During consolidation, like other supply chain shifts, diversifying procurement sources is increasingly important and opens new, competitive opportunities, Traylor points out.
