On this episode of the Six Five On The Road at Computex Taipei, hosts Daniel Newman and Ryan Shrout are joined by Microsoft’s Pavan Davuluri, Corporate VP, Windows & Devices, for a conversation on Microsoft’s innovative integration of AI into its products, specifically focusing on Copilot+ PCs.
Their discussion covers:
- How AI integration in Windows and Copilot+ PCs is elevating the user experience
- The necessary hardware requirements for Copilot+ PCs and their significance
- The transformative impact of AI on the PC landscape through Copilot+ PCs
- Ensuring performance and power efficiency in the PC ecosystem with AI advancements
- Microsoft’s view on the business potential of AI in PCs compared to the cloud, including insights into new Copilot+ PCs from Surface
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Transcript
Daniel Newman: Hey, everyone. The Six Five is on the road. We are here in Taipei, Taiwan for Computex 2024 for this exclusive coverage of Qualcomm. It’s been a big week here in Taipei. We’ve seen a lot happen. Of course, the hottest trend worldwide, which started at Microsoft Build a few weeks ago, was all about this Copilot+ PC. We’ve come here to Taiwan, and Ryan, I don’t think there’s been anything that’s been more in focus here than that.
Ryan Shrout: We’ve had a lot of conversations. It’s been a long time since Computex has been this busy, right, and this much buzz around the PC ecosystem in a long time. It’s been awesome.
Daniel Newman: It’s really exciting, and it’s even making me want to break out some new devices and play with some new toys. In our world, that’s kind of our everyday, but I couldn’t be more excited. But I also couldn’t be more excited to introduce our next guest, Pavan Davuluri, CVP of Windows and Devices at Microsoft. I practiced that all day. Pavan, by the way, you’ve been a bit of a star throughout the event. We’ve seen you on a few stages, and so excited to have you here with The Six Five. So thanks so much for joining us.
Pavan Davuluri: Absolutely. Thank you both for having me, and we are grateful to be a part of this Copilot+ journey for sure. We are absolutely grateful for the partnerships across our ecosystem to bring them to life.
Ryan Shrout: It’s really been an impressive kind of last month of things moving forward with this. So the first question I want to ask you is really about your ambitions for AI on a larger scale with Microsoft. Microsoft’s been integrating AI into Datacenter, into Client for a while. We’ve seen the original version of Copilot kind of come out there. With Copilot+, right, you’re taking that to the next step.
Pavan Davuluri: Yes.
Ryan Shrout: But I’m curious, if you can give me a high level view with as much detail as you want, what’s the next wave? How do you see user experiences fundamentally changing because of this AI adoption?
Pavan Davuluri: It’s a great question, Ryan, and you’re right. You remember we talked about it at Build a couple of weeks ago at this point. Satya referenced this as a, really, year two for us in the AI journey. In many ways I think we’re at the start of what is probably going to be a multi-year, decade-long, perhaps, evolution, transition in the space. For us, I think what we are amazed and excited about is happening at a pace that we had not seen, or quite frankly, most perhaps not expected.
To answer your question, Ryan, I think there’s a couple of places where Copilot+ PCs, and AI, and Windows, and devices take themselves. I think one thing we are learning and seeing is a desire for having Copilot and agent experiences show up more pervasively in the operating system. It was literally in January that we started with the idea of a Copilot key, and now, we’re in a place where we’re talking about a more fully-supercharged OS that is powered by models running real time all the time.
And so I think the first thing we’re going to see is at the shell and user experience level, we’re going to continue to see Microsoft trying to meet customers where they’re at in the flow activity, and bring AI capabilities into task flows, and just have the operating system be an agent for taking them through those flows in a seamless manner, as seamless as we possibly can. So I think you’ll see us continue to innovate on the Windows UX itself to take advantage of AI and just have AI be a more pervasive part of the experience.
The second big piece, of course, is the Copilot+ PCs, all the excitement and energy here in the last couple of weeks. One of the powerful things of Copilot+ PCs is the new platform capabilities with the hardware itself. It allows us to start running a class of models on device, and that, in itself, brings a new class of capabilities to the operating systems themselves. And so we’re very excited about the fact that the OS will have new superpowers, as will apps that are going to show up, especially from Microsoft, in the near term.
The third big thing is the thing that we announced at Build called the Windows Copilot Runtime. The Windows Copilot Runtime is important for us, because it really gives developers a namespace to target to start building AI capabilities into their apps and experiences and for us, from a Microsoft standpoint, to provide them a platform where it’s a spectrum from, they can build their own models and capabilities to just taking advantage of inbox models and capabilities. So I think the three of them together are going to fuel, I think for the next year or two, a bunch of new experiences on these devices going forward.
Daniel Newman: Yeah. The developer is so important, and we talk about it a little bit. But while we get really excited about the devices, the touch, it’s the geeks in us, we like that, but the developers bring this to life. The developers creating the apps, figuring out how to utilize the power of the NPU and how to … Obviously, these chiplet architectures where they can really offload workloads into certain things, that’s what’s going to create the demand for this stuff.
But I got to ask you, Pavan, I need you to be the arbiter a little bit here. So Microsoft has pretty much set the standard of, what is a Copilot+ PC, and it’s not … There’s also talk about AI PC, and these things are not exactly the same. So can you, for the audience out there, just talk a little bit about what it entails to specifically be branded as a Copilot+ PC?
Pavan Davuluri: Yeah, sure, Daniel. I think maybe we should start with AI PCs, because I think we are seeing a strong signal with AI PCs right now in the market. With what we started with in January, AI PCs, in my mind, have … Certainly, they have the Copilot key. The Copilot key is a gateway to a set of OS capabilities that are going to show up that are agent-driven, that are AI-driven, that are Copilot-driven for us. So that’s an important attribute for AI PCs for us for sure. AI PCs, in themselves, have NPUs of varying degrees in size. One great example where AI PCs are actually celebrating NPU capabilities right now are things like Studio Effects, for example, Teams, Zoom, WhatsApp. All use camera, and audio, and microphone stacks for AI, real time today with these AI PCs. AI PCs are more performant, and I think of AI PCs as a start of the journey, and Copilot+ PCs take us to another level of capability.
Copilot+ PCs, Daniel, certainly have a bunch of silicon attributes that define a performance and capability standard for sure, but Copilot+ PCs is really a platform experience where yes, the silicon is a huge part of it. We, Microsoft, had to do work around the operating system itself to unlock these capabilities in the silicon. It was a lot of work with our OEM partners for making sure. In addition to memory and storage, we were doing a bunch of work at the platform level, because at the end of the day, customers want to see a set of experiences.
And so you want to deliver these in a way that is a compelling, complete set of capabilities. And so Copilot+ PCs really embody all three elements of silicon capabilities, are well-defined and tailored for this quantum leap in compute in my mind, a set of OS work that celebrates those OS capabilities, and then our OEM partners doing a bunch of system and platform work that completes the device experience and the system solution for us.
Ryan Shrout: You brought up some of your OEM partners earlier. I talked with one today in this very room where we were looking at, how does the PC ecosystem itself fundamentally change, and how much of it is driven by AI versus how much of it is just coincidental with AI? When I think through the idea of maybe a PC doesn’t look like a PC anymore in three years or five years, right, I don’t need a keyboard, I don’t need a touch pad, I don’t need a mouse-
Pavan Davuluri: Great question.
Ryan Shrout: How do you view that shifting? Right now, everything’s kind of a laptop that has some added capabilities, but I think long-term that could change a lot.
Pavan Davuluri: Yeah. I think this is a space where a ton of opportunity, and I can see a variety of different things playing themselves out. What I would tell you there is the two things that have been helpful for me is, first, I actually think we are well … We have a long runway of actual capabilities with the current form factors in themselves. I think people are going to be more surprised by, by the way, what is possible than what they see today with their form factors.
The example that I use for our own journey within Surface, for example, is the Flex Keyboard on the Surface Pro, and AI is increasingly going to become multimodal. So yes, it looks like a chat prompt, input/response thing out of the gates, but really, as models get multimodal, touch, and pen, and ink, and voice are all options. And so just the idea of detaching the keyboard from the screen, allowing you to use both pen, and touch, and ink at the same time, opens a set of app experiences that we had not conceived of even two years ago. I would say they’re relatively speaking in the form factors that we know and love today, for instance. So that’s the first thing, is I think you’re going to see a lot more value in the current form factors. It’s actually kind of exciting, because like, Daniel, we talked about, those developers, I think, are going to target them out of the gates and push the envelope for what’s possible.
The second point that you’re making, which I think we are in the infancy of really appreciating what this is going to look like, is I think the ability for us to have these models do things that are not possible otherwise for us. We oftentimes think about new capabilities, and a platform shift in compute is really what drives innovation in form factors. It’s this, sort of this virtuous cycle between what’s possible in compute, what’s possible in form factor, and what’s possible in interaction and software design. I think that cycle is in its early cycles when it comes to AI-driven devices or AI-first devices in themselves. So I’m very excited about the latter, as well, I think, and I think a lot of what’s happening on PC and phone will, in fact, spur what those new devices can look like.
Daniel Newman: Yeah. The Shrout bot of the future is going to be-
Ryan Shrout: Nobody needs that. Nobody wants that.
Daniel Newman: Listen, I walk around, and I think of when we get to the point where something like these lightweight glasses become a real opportunity to immerse with the world. I still think there’s going to be a rotation back. I do. I think we’ve sort of gotten into this, the curvature of our … where we want to get. I think that the opportunity with some of these technologies are going to be really, really exciting. We talked to Cristiano Amon. He was talking about how the actual application will live in the large language model, where in the future, the abstractions will change, and applications will change. It was an interesting conversation, because that opens the door to a lot of things. But I want to talk about something that’s a little bit more baseline in this whole Copilot+, it’s power.
Pavan Davuluri: Okay.
Daniel Newman: Okay. So we’ve got a handful of apps, very powerful, exciting apps like Recall that are going to make these new devices super cool to use. Having said that, I think a lot of people are still, “How does the developer build? What are they going to build?” You never really know. That’s how these things evolve, and that’s what’s so awesome about it.
Pavan Davuluri: Yeah. That’s right. Exactly.
Daniel Newman: But they’re going to need more. You get 45, 40 tops, 45 tops, they’re going to say, “I need 100 tops. I need 500 tops. I need 1,000 tops.” Part of the whole Copilot+ is about efficient. You know?
Pavan Davuluri: Yes.
Daniel Newman: It’s about bringing that mobile experience that says, “We can go 16 hours, and you can watch videos, and be social, and use your apps. Your thing’s going to go.” How do you balance that, stay super performant, but at the same time, beat those efficiencies?
Pavan Davuluri: Yeah. It’s a great question, Daniel. I think going back to your end of your question, I think you start with a customer orientation on this. I think people, they have an expectation for their devices to be just great devices, so they want them to be instant on. They want them to be able to have all-day battery life. They want them to be responsive at the end of the day. I think all of those things require, those attributes, rather, require a platform that is indexed on energy efficiency. I think that is an attribute for us, when we think about modernizing the platform over time, is going to continue to be important.
One of the things that we value with the Snapdragon X Series really is the focus on energy efficiency for the NPUs, because in turn, what makes those app experiences delightful is the fact that the AI is available on a high-performance basis and on an always-on basis when you need it. The step function improvement that you get with always-on, background-running capabilities is really fueled by the ability to have a tremendous amount of energy efficiency. We talked about, at our launch event, having like 100X efficiency for running AI workloads.
Those step functions are hard without entirely new neural architectures and NPUs, and ability to be efficient with matrix math fuels that. I think the next step really will be growth on both those vector. I think we will continue to push on being more energy efficient so we can then reuse that currency in a variety of ways for devices and experiences. We will push the envelope for what is possible compute-wise, because I think, hopefully, we will see people finding value, and leaning in, and generating momentum for it.
Ryan Shrout: I think the technology is critical for that. It’s a interesting kind of outlook of the roadmap and how all this goes forward. I want to ask a little bit on the commercial side of this.
Pavan Davuluri: Sure.
Ryan Shrout: As you look through, again, we talked at the beginning how Microsoft is playing in AI in all of these spaces, client devices, datacenter services, everything. How do you see Copilot PCs, AI PC in general come into the Microsoft commercial strategy? How do you monetize this? How do you make it interesting for partners and ISVs to come join the group?
Pavan Davuluri: Yeah. It’s a really good question. Clearly, Ryan, I think the future is going to look like distributed compute for us. You’re seeing huge investments with Azure for sure. You’re seeing large language models get more performant. It’s a breathtaking pace of innovation in that space, and I think we truly believe in scaling laws, bringing new capabilities through the cloud. At the same time, I think we will move into a world of an efficient frontier. You’ll see small language models showing up. You see capabilities on devices in themselves. That, in turn, creates things like Copilot+ PCs.
At the end of the day, I think what will drive us is a world that looks more of a hybrid pattern, where we will build apps and experiences that are the most efficient use of AI and its capabilities both from a performance standpoint, from a cost standpoint, from a privacy standpoint, security standpoint, and that will, in turn, dictate, what does a hybrid pattern look like across both the cloud and the client? I think the business models will look like a version of what we have today, an evolved version based on what subscriptions, and consumption, and device capabilities look like.
Daniel Newman: Yeah, I definitely give a lot of credit to Microsoft for it’s abilities to go left and right. At least that’s how I explain it. Really, from the Edge to the cloud, there’s a lot of, what I say, marketecture about that, but you’ve really accomplished that. You’ve done it with things you own, things you build, things you share, democratizing, and, of course, this is a great example. I’m going to thread a needle here, because you do it every day, Pavan. Threading the needle is here, you are celebrating with all of your OEM partners that they’re building these wonderful devices. Microsoft also has worked very hard, and I think it’s underneath your tutelage, is building Surface.
Pavan Davuluri: Yes.
Daniel Newman: Surface builds some wonderful devices. Use them every day, personally.
Pavan Davuluri: Great to hear.
Daniel Newman: Big fan. But you’ve launched some exciting Copilot+ PC experiences in the Surface portfolio, so I’m going to give you a timeout from trying to be the ecosystem person. I want you to talk your book a little bit. Talk a little bit about the Surface and how you see that evolving, because you got to be excited. You’re glowing.
Pavan Davuluri: Thank you, Daniel.
Daniel Newman: You’re glowing.
Pavan Davuluri: Yes. Yes. We are super excited about them. I think our collective team is very jazzed. It’s been a multi-year project with the Qualcomm team for sure. We announced two new products recently. Both the devices are on pre-order right now. Customers can buy them today. They’ll be available generally on June 18th, and one of them is a Surface Pro. The Surface Pro is a modern definition of what our view of what two-in-ones can look like. It is, by far, the most powerful two-in-one we have built. It has the best battery life of the products we have created so far. The Flex Keyboard we talked about earlier is delightful in my mind, because it brings a set of new capabilities, celebrates Copilot+ experiences in a way that’s not possible. It has a new gorgeous OLED HDR display that I love. I use that device, in fact. Thank you for your usage of those Surface devices. I certainly use a Pro all the time.
Daniel Newman: I only talk my book when it’s true.
Pavan Davuluri: That’s lovely. We also have a new laptop, brand new laptop, which is a completely redesigned laptop for Surface Laptop, which also pushes the envelope for us by way of performance and battery life in itself. I love using both those devices for sure. The one thing with that laptop that I find particularly compelling is as my work machine, I’m in calls, and meetings, and connecting with the team and folks a bunch, and a lot of the features that we’re building in the product, we get to use them. And so whether it’s live caption type stuff or camera stacks, and audio stacks, and Studio Effects … Our Teams team is building on them. Zoom builds on them. WhatsApp is using those features right now. So we’re super excited about both those devices.
Ryan Shrout: I’ve been using them for a little bit, as well. We did some testing on them with Signal65. It was a great experience. Pavan, I want to thank you for taking some time and coming out and talk with us today. I know you’re super busy. You’ve got to run to a bunch of different spots, so thanks for coming on.
Pavan Davuluri: Absolutely. It’s been a pleasure. Thank you.
Daniel Newman: All right, and there you have it. The Six Five is here on the road in Taipei, Taiwan for Computex 2024. We are doing an exclusive series of coverage here with Qualcomm, focused in on the Snapdragon X Elite, this particular conversation all about what Microsoft is doing. Great conversations. Check them all out. Subscribe. Be part of our community. But for this one, for Ryan Shrout and myself, we got to say goodbye. See you all later.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
As President, Signal65 Ryan ensures the company provides valuable insight on competitive analysis, performance marketing, product positioning, and real-world experience comparisons.
With a focus on in-depth testing and nearly two decades of hands-on experience, Ryan has created a breadth of knowledge in nearly all fields of hardware including CPUs, GPUs, AI/NPUs, SoC design, memory systems, storage, graphics, displays and their integration into client and data center solutions and platforms.
He spent five years at Intel serving in roles from competitive analysis, to owning client technical marketing, and driving product delivery in the client graphics and AI division. Prior to Intel, Ryan spent 18 years analyzing hardware and technology as the owner of PC Perspective and three years as the Principal Analyst at Shrout Research.
Ryan has worked with major technology companies and their product management teams at Intel, Qualcomm, AMD, NVIDIA, Arm, MediaTek, Dell, Lenovo, Samsung, ASUS, Meta, Microsoft, and Adobe. His work has been cited and quoted by numerous technology news outlets and is a regular contributor to MarketWatch.
Ryan holds a Bachelors of Science in Computer Science from the University of Kentucky.
