Outcomes before hardware: Microserve CTO Nigel Brown on AI readiness, tokenomics, and resilience from Dell Technologies World

Robert Dutt: Hello and welcome to In the Channel from ChannelBuzz.ca, bringing news and information to the Canadian IT channel community for the last 16 years. I’m Robert Dutt, editor of ChannelBuzz.ca and your host for the show.

Last week, I was at Dell Technologies World in Las Vegas, Dell’s big annual customer and partner event. Over the course of the week, I had a number of conversations that I’ll be bringing here on In the Channel. Last week, we featured three Dell executives. This week, we’re bringing you some partners.

Today, we start on that partner perspective, specifically from one of Canada’s top Dell partners. Nigel Brown is CTO of Microserve, a Burnaby, BC-based solution provider that has earned Titanium status with Dell and taken home Dell’s Client Solutions Partner of the Year in Canada in consecutive years. Microserve serves an enterprise and public sector-heavy client base, which means Nigel’s job is regularly about taking what gets announced on a stage in Las Vegas and translating it into something that makes sense for organizations that don’t necessarily move at conference speed.

I caught up with Nigel on site at DTW last week. We covered a lot of ground – deskside agentic AI and what it’s actually going to take to make that real for customers, the very real cost of token economics, why he’s had to be, as he put it, more of a jerk about cyber resilience, and why the Canadian data sovereignty conversation is more urgent than most people realize.

Let’s get right to it. My chat with Nigel Brown.

Nigel, thanks for taking the time. Appreciate it.

Nigel Brown: Happy to be here. Thanks for having me.

Robert Dutt: So you guys are here, obviously, as a Titanium-level Dell partner, consecutive years as the Client Solutions Partner of the Year in Canada. What’s your overall read on this week? What made your ears stand up? What caught your attention? What are you taking back to both your team and to your customers when you go back to Burnaby?

Nigel Brown: That’s a really good question. It’s also a big one. There’s been a lot of announcements, a lot of dialogue over the last couple of days. I’m trying to process that a little bit, assuming you were going to ask me that. I think the biggest takeaway I had – everybody’s heard of OpenClaw, everybody’s heard all the IT people are terrified of it, so it’s more, how do we get rid of it in our environments? Seeing this whole push around deskside agentic AI, especially given our market where we play a lot with clients – I actually had the opportunity, I did the lab today because I couldn’t resist seeing what it’s like. The governance and security wrapper on it totally makes sense and it’s opened my eyes. I think that’s probably the biggest. Beyond that, I would say the Dell hardware being able to run frontier models, seeing Gemini running local for sovereignty conversations – I think that’s a really good thing to see as well.

Robert Dutt: Along those lines, obviously you touched on one of the big stories this week, which is deskside AI – the idea of physical infrastructure that’s at or near the customer’s desk, either in the data center or right there in the PC, that’s processing the models locally. It sounds like something that you’re interested in. I’m curious where it lands for your customers. Is it something that’s a conversation point, or is it ahead of where they are in the AI discussion at this point?

Nigel Brown: I would say broad scope – I don’t want to lump all my customers into one bucket – but broad scope, it’s ahead. I don’t think you’re seeing a lot of organizations ready for it. We also deal heavily with public sector enterprise accounts, for example. We’re doing more and more in the commercial market where you’re going to see a little bit more playing and adoption within tech teams. But in ours, yeah, I’d say we’re definitely ahead right now. So it gives you a chance to get in there and pitch the idea as something new and plant those seeds. Once I get it past my IT and security folks, then that’s where it’s all going to start. If I can’t get it through mine in a good conversation, then I’m never going to be able to with our clients.

Robert Dutt: But it sounds like there’s at least that – from your comments on OpenClaw, it sounds like there’s that door, that area of interest.

Nigel Brown: Seeing it today under the NemoClaw and Viya umbrella – yeah, I think there’s definitely something there. They’ve set it up closed by default. It can’t leave the box. That’s what I saw in the lab today. So until you set up essentially like a firewall rule to allow it to do something, it’s a safety net that I think really opens the conversation and allows the idea of end users actually playing. Those are really early adopters anyway. And how could I integrate agentic AI into organizations?

Robert Dutt: Man, how often does it come back down to governance with AI?

Nigel Brown: Oh, absolutely. That’s pretty much the name of the game everywhere. And so we’re doing it well, and many are still scrambling.

Robert Dutt: You touch on you guys having a lot of public sector, healthcare, education, all those kinds of verticals – not always the fastest to move on new tech. Along the lines of the previous questions, but sort of taken out a notch – how much of what the AI announcements we’ve heard this week translate directly to where your customers are at, versus how much needs to be, shall we say, adapted for the reality of your accounts?

Nigel Brown: Well, you go to any of these events and it’s, “We’re behind if we’re not doing agentic AI everywhere.” Reality is, it’s just not true. I think it’s very forward-thinking – or very optimistic – to think we’re all moving that fast. It’s headed in that direction quicker and quicker. Executive tables are always the ones sitting there going, “We want it, we need it in our organizations, we’re going to get left behind.” So it’s very top of mind. But some organizations have very niche deployments – they’re figuring out the right solutions. Healthcare – I’ve seen it, they’ve done some phenomenal things in radiology and other areas. So it’s picking up. We’re dealing with one client right now that’s looking at online pharmacy and they’re looking at a huge Dell compute cluster to run AI on. So you see it, but it’s not commonplace. It’s not every organization. Certainly as you get into municipalities and things like that, it’s Copilot at best – that’s really where they’re trying to play – and their user base just isn’t adopting, not even close.

Robert Dutt: So it sounds like there are at least a couple of steps that need to happen to get to the point of, A, using what’s already in place and, B, potentially looking at building out something internally – and the stuff that’s been talked about here a lot, the idea of running those AI workloads internally on the data center side.

Nigel Brown: Yeah. I think it’s going to get there for sure. Right now the conversation has to be outcomes – not “I want AI.” And right now it’s so heavily, “Well, I know I need it, I don’t know what for yet.” I’ve seen it even in some peer groups – the dialogue is, “Well, we’re going to do AI, we’re going to build agents.” So, what for? And then there’s a long pause. Driving outcomes conversations is where it’s going to start, in my opinion. The hardware is going to follow it. And that really ties into, well, where are you going to run it? Do you understand token economics – or tokenomics, whatever the buzzword is right now – and that’s a really big deal. For me, getting that message out really loud and clear around the cost of tokens – I’ve done it, I’ve gotten burned. I spent a hundred bucks on a plane because I wanted to see Claude do something cool. And you’re going, wow, if I can do that in 10 minutes, think of what larger organizations will spend if they don’t find a smarter way to run it.

Robert Dutt: That’s a good point – it’s not something you necessarily understand, but it’s something you can sure feel if you start to have adventures with the stuff.

Nigel Brown: Well, exactly. And all it’s going to take – like I said, a lot of organizations started with Copilot under the Microsoft umbrella, because it was like an easy button. It was there for them, it was already set up. I am worried about some of those days changing, where that subscription turns into usage-based models. And we’ll see where that goes. You’re seeing it with Anthropic, you’re seeing it with Perplexity. I bounce off my limits all the time. Most of what I’m doing I can wait till tomorrow – but it’s easy to get out of control.

Robert Dutt: And user computing is pretty core to what you guys do. There are a few things going on there – Windows 11 end-of-life support coming in October, the AI PC push coming from every direction at the same time. I’m curious if those two things are coming together in customer conversations as one refresh decision, or are they still separate tracks – the need to modernize for the Windows upgrade versus the need to modernize to get the most out of AI workloads?

Nigel Brown: I think the end-of-support conversation and hardware refresh, honestly, is the biggest driver of the conversation that I’ve seen. And then that leads into, well, do I need an AI PC, and why, and what’s going to run on it? Everybody’s exploring and curious about it. There’s more skepticism about whether you need it now.

Robert Dutt: How is that hitting along with the current fun situation with hardware constraints and prices spiking? And we’re hearing pretty directly from Jeff Clarke that, you know, telling customers, let us know what you want as early in the process as you can. I think the natural addendum to that is, make decisions knowing you might have this machine for a little bit longer than you previously expected.

Nigel Brown: Totally right. So it’s very much my dialogue with our clients – it’s future-proofing. You better do it now. You don’t want to be stuck with a machine that can’t run an NPU for the next five years. So even if right now there’s skepticism about how much is going to run on it today, I think it is an important conversation to have and make sure that we’re ready for the moments where we’re really seeing workloads and inferencing running on device. You have to have that conversation now and pre-plan for it. But yeah, it’s been – especially in public sector – a hard conversation to have right now. Supply chain – we’re like a broken record. It still surprises me how many clients we talk to that haven‘t seen this coming, that don’t know it’s real, or you get the ones going, “Well, I think it’s going to clear up in September, I’ll just wait till then.” Oh man. Brace for it. We’ve got to be ready. It just feels like a conversation on repeat these days – and it’s more than worth it, making sure we’re doing model selection with the future in mind.

Robert Dutt: I find it’s a fun time to be a partner in that particular space.

Nigel Brown: Well, you know, quote volume has quadrupled, because that same customer deal might take four different passes before they’ve made it through, especially in government. Pricing validity is a real challenge. It’s a moving target – no decision ever gets made fast.

Robert Dutt: I want to talk a little about cyber resilience – another big topic here at the event. You guys run a managed backup practice, I understand, and you’re doing a lot of what vendors are asking MSPs to evolve towards. When you get into a customer environment today, what’s the most common gap between what they think their backup situation looks like and the reality of the situation?

Nigel Brown: That’s an interesting question. It’s a real mixed bag. I always start with, “How confident are you in your ability to recover?” And most leaders – business leaders, outside of IT – there’s like a long pause. “Well, I don’t know.” Okay. Have you ever tested your recovery capability? No. Well, that’s where we’re going to start. And in other dialogues, they think they’ve got the backups running, but nobody’s been looking at them – they’re coming from doing it themselves, or maybe a mom-and-pop IT person taking care of it. They’re not watching, they’re not looking at tools, they’re not getting alert notifications on whether it’s keeping up and whether they’re protected. So that’s very foundational. Warning new clients – it’s just, let’s take them on that journey, do an assessment of the whole environment, make sure we’re protected. And a lot of conversations are, “Do you know that you’re not protected? Like, if you got ransomware tomorrow, there’s nothing I could do to help you, even though I’m your MSP.” That’s a scary reality. I’ve seen that have to go back to boards and make some tough decisions, find budget and solve it. They usually do – they react fast – but you’ve got to make the risk abundantly clear.

Robert Dutt: That makes sense. In talking to Rob Emsley, who’s on the marketing team for the cyber resilience side at Dell, he was saying that 97% of cyber attacks now are specifically targeting backup infrastructure – because it turns out that’s where all the stuff is. Does that match what you’re seeing, and has that shift changed what you’re recommending to customers about what being protected really means for them?

Nigel Brown: I wouldn’t say it’s really changed our messaging. I’d like to think we were maybe ahead of the curve in talking about storage and immutability – some of these key elements of, well, you just need it. That’s how we run our hosted service for clients that use it. And if we’re building out an architecture for another client, it’s just fundamental these days. You can’t even consider a solution that doesn’t include immutability protection, being able to spot bad things happening. But I’ve seen it – we’ve come into a disaster client where, “Hey, we got ransomware, can you help us recover?” And you go to the backup server to find out it was ransomwared too. “Do you have any tapes floating around?” It’s a tough chat to have. You see that less these days, but you definitely see the attempts – people trying to do it. And even other MSPs – I hate to say it – they’re not mature enough in how they’re protecting. They took the backup server, joined it to the domain – it’s just another device on the network. And sure enough, that’s exactly what gets hit because they didn’t plan it out. So it’s all planning and doing it right in the first place.

Robert Dutt: It’s a checkbox as opposed to something that’s more firmly thought through. Given that, how do you approach it with customers? Do you come at it as, “This is something you should do, these are the reasons why, this is the potential downside” – or is it a thou-shalt kind of conversation?

Nigel Brown: You know, a pile of years ago, after seeing an incident hit a new customer, I kind of resolved – I’ve got to be more of a jerk. I hate to say it. I got to be a lot tougher in my stance. I was being too nice. So yeah, in all things on this, my position is to generally take a pretty firm line. It’s all about risk, though. And to business leaders especially, that’s a term they understand. I’m not telling them, “Okay, you need this type of backup solution and it’s going to do these things.” It’s all about, how do we address the risk that you have right now? Leave it to us to figure out the details as we design the solution. Rarely do we get into the weeds of it unless it’s a larger client where we’re dealing with a large IT team that has opinions. But usually in those larger environments, there are groups that are already aligned – they know what they should be doing, maybe just haven’t done it themselves yet. The new architecture is absolutely going to include all those steps. So it’s an easier conversation to have. In some ways, it’s giving them permission if you’re coming in as a new supplier – it’s the stuff they’ve wanted to do, but haven’t really had the air cover to make the case.

Robert Dutt: Yeah, you come in as that outside opinion to say, this is how it needs to be.

Nigel Brown: And our job is often more of just a translator for those IT teams to their leadership – to help support the business case.

Robert Dutt: I want to talk about the Modern Partner Platform and some of the partner program changes that have rolled out this week. One of the big things is obviously the revised incentive structure, with cyber resilience particularly called out as a premium rebate area. From your seat as a Titanium partner, what does the new structure tell you about where Dell sees the biggest growth opportunities for partners?

Nigel Brown: Well, I think it does exactly that – it says where the growth opportunities are. And largely there was no surprise. In my opinion, when you look at it, it aligns to how we want to lead deals, it aligns with the conversations we’re already going to have. Now it’s just helping incentivize that dialogue. Nothing surprising there – I just see better alignment.

Robert Dutt: Let’s play a little bit of “anything can happen here.” Vendors like Dell are starting to build agentic AI into their programs, their portals, their tools – all the stuff you guys work with every day. Where do you see the most genuine value for an organization like your own in vendors – agentifying, for want of a better word – their partner programs and tools? And the flip side: are there any potholes you’re watching out for as that rolls out?

Nigel Brown: You know, the more the merrier – more tools you can bring in is great. We’re always excited to see what they come up with. But to me, the bottom line is back to outcomes. It’s about reducing friction in the sales process. What do we want our sellers to do? We want them out selling. Living in a partner portal trying to find what they need, deal registration, all of those things that can be painful – sometimes it’s just admin work taking you away from conversations with clients. Reduce friction – that’s the name of the game. Do I want to see more AI-generated marketing content? No. We can do that ourselves – one prompt, feed something in, done. To me, the more you can expose what matters to us and reduce friction, the better. It keeps us doing what we should be doing and not sitting there doing admin work.

Robert Dutt: It sounds like based on that comment, what Dell and a lot of its peers are doing is already on track – because I’m sure they’re asking these exact same questions of partners around the world right now.

Nigel Brown: Oh, they’ve got way smarter people than me working in these massive organizations. They know the outcomes we want to achieve. And I’m excited that we’re at a point in time where we can see some of this come to fruition. Ten years ago, this was never a reality.

Robert Dutt: What’s the biggest misconception you think your customers have about what it means to be AI ready right now?

Nigel Brown: I think it depends on who the conversation is centered around. If it’s C-suite leadership, it’s back to, “We want AI, I don’t know what for, I don’t know what it is, but I know I need it.” There are tough conversations to be had. AI readiness is really, is your data ready? We heard that on stage this morning. Most organizations we walk into – it turns out they’ve got no data governance. So, let’s define some of this, let’s build some process, look at the right tools. In the Microsoft lens, we do a lot around Microsoft 365 and modern workplace. Well, then it’s a Purview conversation. And they get confused – “Why are you talking about DLP and Purview? I thought we were talking about AI readiness.” That’s exactly what it’s all about. The other big one I think they’re not taking seriously enough is the end-user adoption side. I’ve seen organizations – you go into their portals and have a look with them – their adoption of Copilot, where they’ve spent a whole pile of money, is abysmal. So then the dialogue is, “What you actually need to do is get your users excited. Train them, show them the cool things.” I think we’ve been really successful doing that inside our own organization, and now that’s something we deliver to our clients as well – we need to get your teams ready and thinking differently. At a C-suite level, they’re usually surprised at the path it takes, or in some cases how long it might take to get there. “Your data is in such rough shape – you’re two years away. You need to build a foundation before you can really consume it.” Now, some of the announcements this morning – okay, that starts changing the equation. We could get there faster if we have the right infrastructure in place.

Robert Dutt: For a variety of reasons, the Canadian data sovereignty question feels like it’s getting louder. And I have to imagine, especially in your public sector footprint, how are you helping customers think through AI infrastructure decisions when data residency and compliance are an increasing part of the equation?

Nigel Brown: It’s a non-negotiable for most of our enterprise and public sector clients. It’s going to run on-prem. They cannot afford to run on cloud. Yes, they want the latest models, the frontier models, the cool bells and whistles as we all do. But really – I presented at a conference last year on exactly this topic, why it’s important to bring it back on-prem. Never mind the tokenomics conversation – now there’s just more ammunition. I chatted with one IT leader, a commercial client, not public sector, who was all proud of how he’d migrated everything to cloud. We were in a session where they talked through the tokenomics challenge and another reason why sovereignty matters. And you watch the look on his face go, “Wow, I’m going to have to start building a data center again. I thought I got out of that.” And he was sitting there with his CEO in the room for that conversation. Kind of a wake-up call. So my dialogue is, let’s talk through what does the Patriot Act mean? What does FISA Section 702 mean? It’s a little bit scary, and people are shocked – “I thought running in Google Cloud or AWS, running it in a Canadian location was good enough.” No. That provider has access to your data. Have you heard of the CLOUD Act? That’s nothing compared to FISA 702 – they don’t even need to ask. They can just go and get it. And that’s pretty scary. So yeah, a lot of our job now is just sharing and communicating the right things to our clients and making sure they’re aware.

Robert Dutt: Aside from your efforts to bring that education – do you find that the level of general awareness is on the rise? Are we getting to more of a discussion about how to solve for this, rather than still defining the scope of the problem?

Nigel Brown: I would love to say it’s more mature. The reality is no – it’s still early-stage conversations. You get anomalies. We were with some clients who are way ahead and have just deployed Azure Local on Dell infrastructure. They’re doing amazing things, moving fast. So now it’s more, “How can I partner with you to go share this message? Why you went there, why you built it this way, what are you doing about it?” But no, it’s going to be a continued push – much like the supply chain story here – these dialogues just repeat as you walk into client after client.

Robert Dutt: Last one for me – along the same lines as the first question, but a slightly different lens. What’s one thing from this week that you think will genuinely change what Microserve brings to customers in the next 12 months?

Nigel Brown: I come back to where we started – the whole side of agentic AI. That was not on my radar, not in a serious way. “Let’s play around with this, let’s lab it out, see where it’s getting explored.” When you see a name like Dell behind what we’re doing, that got me more excited than I would have thought. I want to pilot inside our org. And if we can start building something that works here, then absolutely – taking that to clients and saying, “Okay, look at the GB10s, look at the GB300s, let’s move up the ladder.” There’s a tangible path that gives them more value than trying to build massive solutions right out of the gate. There are quick wins there, and that’s what excites me – showing a customer how there could be a quick win if we did this right. And it ties into the last thread we were pulling on – “Okay, you’re telling me I shouldn’t have all this stuff running on public cloud, so where’s it going to run?” And you’re not talking megawatts and massive data centers here. All I want to do is automate tasks and do some of this lower-level stuff. I think that’s going to be an interesting entry point for a lot of clients – making it more accessible. Everybody’s used ChatGPT, Claude, whatever their tool of choice is, so they’re into prompting. Nobody’s really understanding Copilot or understanding agentic – it’s a big buzzword. That’s our job. We can show them a slice of the possible, mock up these use cases, and those are quick wins. Then it is something deployable at scale – you just move it from the little box to a bigger box. The more people take advantage of it and keep moving up the scale, you don’t need to go spend millions upfront to play around with something like that. It’s going to open more doors.

Robert Dutt: No shortage of interesting opportunities. Good luck getting out there and chasing those, and thanks again for making the time this week.

Nigel Brown: You bet. Thanks for having me.