Delivering AI-Ready PCs at Scale with Intel Partners – Six Five On the Road

By Patrick Moorhead - September 26, 2023

On this episode of The Six Five – On The Road, sponsored by Intel, hosts Daniel Newman and Patrick Moorhead welcome Intel’s Jim Johnson, SVP, Client Computing Group and GM of Client Business Group, along with Jerry Kao, Chief Operating Officer at Acer Inc for a conversation on Intel’s largest client architectural shift in 40 years and what makes this shift so exciting for the future of AI-ready PCs.

Their discussion covers:

  • Distinguishing features of Intel’s Meteor Lake (MTL) architecture compared to prior platforms
  • Impact of the new architecture on Acer’s design paradigm
  • Anticipated launch timeline for products featuring the new designs
  • Intel’s Vision for the future of AI-infused PC technology

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Transcript:

Patrick Moorhead: Hi, this is Pat Moorhead, and The Six Five is on the road here in San Jose, at Intel Innovation 2023. And we are chatting with many of the inventors, the developers, and of course, folks from Intel and their partners.

Dan, this is a great show so far. How are you liking it?

Daniel Newman: It’s good to be in San Jose. We are in the-

Patrick Moorhead: It’s like our home away from home.

Daniel Newman: We are in the Silicon Valley.

Patrick Moorhead: I know.

Daniel Newman: And we are going to talk some silicon, but not just semis. We’re going to get into software developers. We might even talk a little bit about AI.

Patrick Moorhead: Gosh, imagine that. No, I mean, since November, isn’t that all we talk about is AI. Isn’t that great?

Daniel Newman: I think it’s everything, everywhere, and it’s the only thing. And we should talk about nothing else.

Patrick Moorhead: I agree.

Daniel Newman: But, no. I mean, look, there is so much going on, Pat, and really from the edge to cloud, from the device to the data center, there is a lot of things to be excited about. And technology is moving forward really quickly, and I think having the chance to have some of these partners and executives on the show is just an opportunity to further highlight all the things that are going on.

Patrick Moorhead: I totally agree. And a lot of the conversations so far in the AI spectrum has been all about the data center. But as we know, over time, compute goes to the point of data and where people are using it. And it is my pleasure to introduce Jerry, Jim. How are you?

Jim Johnson: Great, thank you.

Jerry Kao: Great. Thank you.

Patrick Moorhead: Yeah. Welcome to Six Five. First time, folks, in The Six Five, not first time Intel or Intel partners, but it’s great to see both of you.

Daniel Newman: Yeah. So Jim, Meteor Lake, you’ve been releasing and announcing the number of details. It’s a big week for the company. Give us a little bit of what is going on, what’s being announced.

Jim Johnson: Well, a big debate my team and I have is, about Meteor Lake, great product or AI? Great product or AI? And yes.

Daniel Newman: Yes.

Patrick Moorhead: Wait a second. You guys collaborate?

Jim Johnson: No, we did not do that at all. So by construction, we used all of our new process node technologies. And when we say chiplets, you get to use the best node for the best part of the product. If it’s performance, we’re using Intel 4, but you can go for IO processes. And so, our technology brings that together. And I’m just excited to say, you’re going to see designs that you’ll first say, “Wow, what a great product in Intel tradition,” but we have a huge story to tell about AI with software.

Daniel Newman: Right. So how many processes?

Jim Johnson: We have five processes-

Patrick Moorhead: Come on, spill.

Jim Johnson: … and five different chiplets. And we have a lot of disclosure coming out of that. And it’s been a new culture for us to do that, but it’s actually allowed us to take the problem or opportunity of a product into pieces, but it’s actually taken some of the strongest architecture talent deployed to these products.

And if you study what’s been done, it’s really a huge breakthrough. We said hybrid, with the last architecture, performance cores and efficient cores was big.

Patrick Moorhead: Right.

Jim Johnson: This is even bigger than that, and it has a lot of software excitement from the ecosystem because of what we can do on it.

Patrick Moorhead: Yeah. I mean, this architecture represents really the future of all chip making. And some people don’t know that yet, but we are starting to see this, right? Saw a little bit on the data center side, on the client side. Super exciting of what you can do when you get the right IP block on the right process.

Now, in the end, it comes down to the core value prop to the end user. What does all that goodness mean in this architecture?

Jim Johnson: Well, it depends on which part of the market you’re in. If you’re a heavy communicator, if the PC’s become your primary way of having a video conferencing call, there’s going to be a lot of tech that gets deployed with Meteor Lake for making that a richer experience and an all-day experience. Our goal is all-day battery life. You don’t have to take your power bank.

If you’re a creator, I’ll let Jerry talk a little bit about this, they’re finding things they can do with this capability that I didn’t ever dream when we architected the product. When we showed up in Taiwan and he gave us demonstrations of what he’s doing, it blew our mind. We opened up the architecture with new capability, and people are taking advantage of in ways we hadn’t even anticipated.

Patrick Moorhead: Yeah. I’d love to hear that, Jerry. I mean, it’s funny, Dan and I joke between software’s eating the world to silicon’s eating the world. And wait a second, if software is eating the world, what does it run on? Air? Right? But the reality is that software and hardware have to come together.

Jerry Kao: That’s true.

Patrick Moorhead: If you have these amazing features in hardware and no software, it’s irrelevant. And you have this amazing software, but no hardware to run on, it’s irrelevant too.
So what are you doing on the software side to really light up those experiences? Something really cool happened in the last time you guys got together, but what’s going on in the software side?

Jerry Kao: Okay. Allow me to put it this way. A lot of people thinking about PC hardware. Yeah, just hardware, right?

Patrick Moorhead: Yeah.

Jerry Kao: Be honest. Before, really, we can treat PC hardware by using Intel, or panel, or SSD motherboard put together. Okay, Microsoft is going to do everything. Done.

Patrick Moorhead: Right. Call it a day. We’re done. It runs Windows-

Jerry Kao: But today, it’s changed.

Patrick Moorhead: Yes.

Jerry Kao: It’s changed. I mean, with the Meteor Lake, Intel provide not just the hardware, but software tools like OpenVINO. So with those tools… Oh, yeah. Like Acer, actually we can base on this hardware and also software to create a lot of features, which in the past we even don’t think. Even we think of a feature, but we don’t have a tool to create it.

Patrick Moorhead: Right.

Jerry Kao: That’s the reason why I think this is really revolution change by the Meteor Lake, by the NPU. Then we have the capability to make our dreams to come true.

Patrick Moorhead: Yeah.

Jerry Kao: This is amazing.

Patrick Moorhead: I love that.

Jerry Kao: Yeah. Amazing.

Patrick Moorhead: I’m excited.

Jerry Kao: Yeah, exciting. I mean, I lead R&D team for a long time. It’s the first time in my life I saw artists so energetic.

Patrick Moorhead: Right.

Jerry Kao: In the past, they have our dreams, but never come true.

Patrick Moorhead: Right.

Jerry Kao: They never come true.

Patrick Moorhead: Right.

Jerry Kao: But now, we have tools and we can base on the tools to lead to the dream. And then the angle is there, and actually we work for years. And then we have many creative AI applications.

Patrick Moorhead: And these are tools that can run across the CPU, the GPU, the NPU.

Jerry Kao: NPU. Yes.

Patrick Moorhead: Right? In harmony, because it gets really complex.

Jerry Kao: That’s true.

Patrick Moorhead: If you don’t have those tools to be able to know where to optimize, and in many times, actually, I don’t want to put words in your mouth, but at least what I’ve seen on other platforms, even the smartphone today, you might have an application that lights up all of those subsystems.

Jerry Kao: Yes.

Patrick Moorhead: And you’d be very careful in how you architect that. And without those tools, it’s impossible. But I’m super excited to hear this is the case, because we’ve had AI enabled on the PC for a while, right?

Jerry Kao: Yes.

Patrick Moorhead: You could do it on the CPU. You could do it on the GPU.

Jerry Kao: GPU. Yes.

Patrick Moorhead: You could do it on an AVX unit, right? But it sounds like something really has clicked into gear-

Jerry Kao: That’s true.

Patrick Moorhead: … that’s going to make a difference for your customers and your products.

Jerry Kao: That’s true. Because, you know, CPU, GPU, and NPU, they are not three. They are one plus one plus one is much larger than three. That’s why Intel OpenVINO tools lead OEM to do that.

Daniel Newman: So you’re one of the Meteor Lake launch partners with Intel?

Jerry Kao: Yes.

Daniel Newman: And you’re clearly very enthusiastic.

Jerry Kao: We are.

Daniel Newman: Excited.

Jerry Kao: We are.

Jim Johnson: Both of us are.

Daniel Newman: We knew you were, Jim.

Jim Johnson: Oh, I know. I can’t help it. It’s infectious, is what it is.

Patrick Moorhead: Yeah.

Daniel Newman: But one of the things I’m really excited to hear too is I think we have spent so much time thinking about AI through data center, because of all the LLMs, and that kind of got all the hype since November. And of course, we’ve been experiencing AI on our devices for some time, whether it’s been NLP or small language translation, things that we’ve been doing.
We’ve had apps finishing our sentences for years, trying to. Not always correctly. But it sounds to me like there’s a breakthrough here. And in these next generation of PCs, I think we’re all kind of wondering what the next generation of tools, technology, PCs, for instance, are going to look like. So it sounds like this next Meteor Lake based experiences on Acer are going to be that opportunity.

When do you see the world, when are these experiences going to start to be available to the audience out there? All the people out there that are listening and saying, “Okay, I want to try the computer, the PC of the future.” When is that going to start to become available from Acer?

Jerry Kao: Well, we start to do everything. And to be honest, there is somehow available already, but we need to also work with Intel to find the right timing to push to the people.
Yeah. So it’s been there. I’ve demoed it.

Jim Johnson: We’ll have Meteor Lake devices out this year on the shelf.

Daniel Newman: Okay.

Jim Johnson: And then, it’ll just 10x-ish that in the first quarter. So-

Daniel Newman: Do you guys see a wave of PC demand? This is something that we think a lot about. It’s been kind a tough couple years on PCs in the market.

Patrick Moorhead: Well, it was kind of in this bust and there was this boom, and then now people are wanting to know what’s next. Right? And that particularly, on the consumer side. And I think in our reports, we’ve talked about a lot of room on the commercial side particularly, because we still don’t have a great hybrid work experience. But no, it sounds like, so units are going to be coming out next year. Right?

Jim Johnson: This year.

Patrick Moorhead: This year.

Jim Johnson: This year.

Patrick Moorhead: Okay.

Jim Johnson: And Meteor Lake is going to be a big player in commercial. And so, again, Meteor Lake being a great product and doing AI is really important. So it’ll have the stable image platform program value proposition.

Patrick Moorhead: Right.

Jim Johnson: And it’ll bring new experiences. And Jerry’s comment on software, if software companies are any indication of the excitement that’s building, they can write, with our OS provider, they can write to a tool that runs on anyone’s NPU. Heaven forbid, not ours. But let’s say they want to. But if they tap into OpenVINO, it can run native-like speeds on our NPU. And that’s Intel’s opportunity, and why we invested so heavily in hundreds of software engineers to provide tools to our customers.

Patrick Moorhead: Again, the benefits too, at least in our research, which hasn’t… It’s funny. Are there any new ideas out there? I don’t know. They just get bigger, better, faster. Right? And if you look at analytics that, again, nothing ever goes away. Analytics didn’t go away when machine learning came out, and then deep learning, and now generative AI.

But being able to do the compute locally and do that AI, typically means that you’re going to get better responses, faster responses. Okay? And there are some people who don’t want to put all of their information up into the cloud.

Jerry Kao: That’s true.

Patrick Moorhead: And that’s just a reality. And whether it’s financial information. And in some countries, in some regions, even putting photos up into the public cloud is not like it is in certain countries. So I’m super excited about that. So is this really a milestone to the future of computing?

Jim Johnson: Well, I’ll use the analogy. I was around when we brought WiFi from 10% attach rate to notebooks to a hundred percent. So we all were able to unplug from the wire and do computing anywhere we went. And with AI on the client, you’re not going to be tethered to the cloud. So the things you want to do with your photos or with your applications, or when you’re creating something, you don’t need to be dependent on the latency to a cloud provider.

It’s there if you need it, but we’re going to keep building things locally. And so Pat, in his last Earnings call, I wrote this down because I think he just happened upon, like, we’re going to unplug from the cloud. AI unplugged from the cloud.

Daniel Newman: Wow.

Jim Johnson: And I think that resonated with me because that’s kind of where we’re going to keep moving things from the cloud to the client. We’re going to be the inference large hardware footprint.

Daniel Newman: So as the WiFi created its own wave of PC demand, what you’re saying is the unplugged AI PC could be… I’ve genuinely been looking for what is the thing that’s going to stimulate the next significant super-cycle.

We know what happened in 2020 and ’21. Created this almost, I would say, unexpected and unprecedented super-cycle because there wasn’t necessarily any sort of earth-shattering technologies that were hitting in that exact period of time. It just happened that, all of a sudden, everybody needed to do Zoom calls at home.

Now, we still need AI to make that work better. We need AI to make our microphone sound better. We need AI that enables, to your point, us to continue editing documents using grammar editing, edit photos using photo editing, when you’re not necessarily connected, or you don’t have a good connection. Because let’s face it, even when you might have connectivity, we all have tethers to our phone. It doesn’t always give us enough connectivity to do things in the cloud.

So if I can ask, do you guys see this as a super-cycle creator? Do you see that kind of demand being pulled forward as people are going to want an AI PC?

Jim Johnson: I’ll let-

Jerry Kao: I think the WiFi is something just that make people connected. But after connected, you need to do a lot of things. But think about scenario that we all got stopped by somehow, even my phone, the 5G, the LTE doesn’t work.

I traveled to Seattle two weeks ago. The hotel is actually a very good hotel, but I just don’t know why. Just my LTE cannot work, my 5G cannot work. And also, at that time, which I’m busy in preparing report to my boss, but the WiFi and also the fixed line in the hotel also cannot work.

Daniel Newman: Right.

Jerry Kao: I got stopped. And think about, I actually need some weapon in the cloud, to do some analysis, to collect some information for my report. But luckily, I have AI already.

Daniel Newman: Yeah.

Jerry Kao: This will just change people’s life. And also, another point will be that, in the past, even PC, as you mentioned about, already have AI, but that is normally a very bulky device, no computing power. But right now, with Intel Meteor Lake, seen alone, like this one.

Daniel Newman: You can just leave that here, by the way. When you leave-

Jerry Kao: It can run Stability Diffusion easy.

Patrick Moorhead: Oh, that’s wonderful.

Jerry Kao: Yeah. In the past-

Patrick Moorhead: Without being connected.

Jerry Kao: Without being connected.

Patrick Moorhead: Okay.

Jerry Kao: Without being connected.

Jim Johnson: You know, we have our meetings and we’re talking to each other, but I’m really talking to you, looking at your screen?

Daniel Newman: Yes.

Jim Johnson: And you’re talking to me, looking at my screen, we can actually correct that. So we’re looking at each other’s eyes.

Daniel Newman: But we’re not actually looking at each other’s eyes.

Jim Johnson: We’re not. You’re still looking at your screen.

Daniel Newman: It looks like you’re looking my eyes.

Jim Johnson: Yeah.

Daniel Newman: So now we can be less rude when we’re being rude.

Jim Johnson: Yeah. And if I say, you’re going to want one of those PCs, I think. But I don’t want to forecast the TAM on a video because I’ll only live to regret it. But-

Daniel Newman: Yeah. Well, I didn’t expect you to actually answer that exactly.

Jim Johnson: But the excitement is just-

Daniel Newman: Yeah, that enthusiasm to get people back in the stores. There was a certain fruit company that launched another handset last week, and Pat and I were doing-

Patrick Moorhead: I think we were yawning?

Daniel Newman: … calisthenics to try to figure out why anybody’s going to do this. I mean, why would you go spend a thousand dollars on this thing, when it still has half the optical zoom of another company’s device that’s been out for two years?

Jim Johnson: Right.

Daniel Newman: So this sounds like it’s actually, it’s new stuff. It’s new capabilities that people will say, “I cannot upgrade my software. I cannot do any sort of to this device. I have to go buy a new device and I’m going to get all kinds of new capabilities.”

Patrick Moorhead: Yes. And I think we just have to look at history on the different waves of computing, and recognize that the compute, the best type of compute, will go as close as it possibly can be to the data. And I think we were all, in the industry, when a company essentially said that we were going to paint the UI from, it wasn’t even called the cloud, it was just called the data center. Okay?

But what happened is developers kept finding these amazing ways to fill the vessel full of software UI and experiences that just made it make more sense. It’s funny, the one thing that very few people talk about too is the economics of the end-to-end. It makes a lot more sense even for cloud companies to have all of this compute at the edge, because sending all that data back and forth is super expensive.

Acting on that data is very expensive. I don’t know if you want to call it a price per MIP, or a price per sum unit of energy, and it’s incredibly inefficient to send everything there.

Jim Johnson: Remember the MIPS, you know, better hardware, better software. This is the CPU industry growing up.

Patrick Moorhead: Right.

Jim Johnson: That’s exactly what’s going to happen for local AI. We’re going to have better local AI processing. CPU, GPU and NPU, they’re going to take advantage of it and demand more. And I think we’re in a multi-year, if not a decade, horizon of this bridge of a software spiral in AI.

Patrick Moorhead: Yeah. I totally agree. And maybe we wrap on this, but the biggest difference in my estimation, having been in and around the PC industry for over 30 years, is the excitement in the software. Because it always seemed like the hardware was there, the software is not, right? The shiny software’s there and the hardware’s not.

It seems like we may have had an intersection here, and I do believe that even the operating, we can say Windows on this show, Windows is going to help us as well in this, based upon everything public that’s been said, what was said at Build, and things like that.
But, I mean, the PC’s been a little jealous of the smartphone, that’s been running 15 simultaneous neural networks at the same time.

Jerry Kao: Yeah.

Patrick Moorhead: And it wants its time now, and it seems like that time is now.

Jerry Kao: Yes.

Patrick Moorhead: Excellent.

Daniel Newman: All right. Well, Jim and Jerry, I want to thank you guys so much for joining us here on The Six Five, at Intel Innovation. It’s been great to hear from you both. I think there’s a lot here and then we have a very exciting cycle ahead. And Pat, we’ll put our predictions out later as to just how big it is, after the event.

But it’s always great to be here. It’s great to hear from both of you. Thanks for joining us and come back soon.

Jim Johnson: Thanks for having us.

Jerry Kao: Thank you. Thank you.

Patrick Moorhead: All right.

Jerry Kao: Thank you very much.

Daniel Newman: All right, everybody. Hit that subscribe button. Join us for all of our coverage here at Intel Innovation 2023, in beautiful San Jose. For Patrick Moorhead and myself, we got to say goodbye. But we’ll see you again really soon.

Patrick Moorhead
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Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.