Howie Xu — theCUBE + NYSE Wired: AI Factories - Data Centers of the Future

[00:00:00] John Furrier: . Hello, I'm John Furrier with theCUBE. Welcome to theCUBE podcast. This is the NYSE Wired program, a CUBE original, part of the CUBE family, and also the NYSE Wired community, headed up by Brian Bauman. It's an open network of leaders coming together. We have CUBE alumni and kind of a contributor for theCUBE. He's almost like our own reporter, Howie Shue, but he's also the chief AI officer at Gen Digital. The pedigree goes way back to the early days of Cisco, invented many things in technology. If you know theCUBE, you know Howie Shue. Howie, great to see you here in our studio. Hi John, so glad to be back to theCUBE, and the New York Stock Exchange. I mean, we were just talking before we came on camera. I wish that we were rolling. We were just having some good chats about some of the historical perspectives, and you've seen many ways. We've talked about this many times on theCUBE. Big gorgeous one IPO yesterday, [00:00:52] Howie Shue: former Nescape CTO, which is the building by working day in and day out now in Mountain View. [00:00:59] John Furrier: I mean, you've got former Netscape. Netscape was a cultural revolution. AI and crypto. Cultural revolution. Cultural revolution in crypto. AI is going through a cultural revolution, as physical AI is right around the corner. But it's so hyped up. It's so changing. I mean, we had the wave, Howie. Paper, you write stuff down on paper. You mail stuff, and then the internet came along. Then you got mobile and cloud. So that generation was really a great movement. Everything was invented. The computer industry was thriving and scaled up beautifully. Yeah. And then now we started to see that transition. We saw crypto early. We saw some AI stuff happening. But really go back five years, you know, as the AI stuff came out of Google and other academic areas. ChatGPT came online. And the rest just has been a barn burner of activity. This wave, you almost started, okay, Transformer, AI, ChatGPT, to autonomous everything. Yeah. Okay. Not quite yet, but we are getting there. But this is the similar wave. Print to mobile and cloud with internet in between. That was a cycle. This super cycle is AI to move along. And then at the end game, fully autonomous stuff. Physical AI, digital, all converging together. That's kind of well, that's talked about in the industry in that context, but it's happening. So I want to get your thoughts. You were on a few months ago on our AI leader series. You're very active in your job, obviously as Chief AI Officer, but you're also out and about. Talking to entrepreneurs in Silicon Valley. What are you seeing? What's the big trend line, observation, sentiment around where AI is now? [00:02:39] Howie Shue: Yeah. You know, you see conversations on different sides of the spectrum, right? On one side, it's the AGI, right? You know, building huge data center, right? You know, that's the one end. The other end is that AI bubble going on, right? You know, it's like there's a conversation about open AI. Sure, $20 billion revenue is big, right? But still, they are committing like, what, 1.5 trillion, maybe by the end of the conversation, $2 trillion in for a build out. Is that too much? Is that a bubble going on? And then everywhere in between, right? Personally, from my point of view, you know, there is a, you know, AI is real. You know, we see it. I mean, from the chat GPT moment, we realized that AI we've been talking about for ages. Finally, it's the, you know, reality. Now it's the question is how to bring this, you know, technology to marry with your, in the enterprise world, marry with your data, in the consumer side. How do I change the way we live, right? So, it's about, you know, just to marry the technology to reality at this point. I think we are three years into chat GPT moment. And I want to say, you know, it's already big, but give another three years, it's going to be upside down. [00:03:53] John Furrier: I absolutely agree. I like how you said that, bringing AI to the reality. And that's physical, that's our life. So, on consumer side, AI into our experiences. I mean, I was interviewing Frontier Digital Health. They are saving lives. I mean, that's as real as it can get. We're seeing-- Surgeon. Surgery, we're seeing retail experiences. So, there's no doubt that the physical nature of what we do as humans, we go to stores, we go, we walk around, we drive around, we have families, we do things, so that's clear. Enterprise, they're in business to serve customers, who are users in reality. So, they're moving around, right? So, let's break those out. So, let's start with the Enterprise. We'll come to the consumer. I think that's more fun, more active. But, the Enterprise has been struggling. Because, not struggling in the sense of momentum, the strategy's clear. Infuse AI in your business. That's a strategy, no debate. How to do that? The execution risk is coming. And so, it's not like you can just go in the Enterprise and be like, "Okay, magic wand, throw everything out and introduce an Nvidia box." [00:05:00] Howie Shue: All the people aren't doing it. I know where you're coming from, right? You know, there is this MIT report that said, 95% of the budget or the experiments didn't go anywhere. Gardner, you know, reports. None of those reports show the super optimistic, sort of, the result. [00:05:14] John Furrier: I didn't like that MIT report. I'm against that because experiments generally do fail, one. Number two, we have enough evidence, just on theCUBE interviews we've done, where the benefits of people who are doing agentic and agents and AI actually have done it right. They executed, knocked down some wins. And, whether it's a saving life today or increasing profits for a retailer like Zebra Technologies and others, it's working. It's not a fail. It's not a category fail, it's just where it is. [00:05:42] Howie Shue: So, you know, you speak my words. I'm not going to repeat it. So, just to give you my own insights into why that's the case, right? There are two things going on. By the way, it's nothing new. This has been going on for the last three years since the chat GBD moment. One is technology still needs to mature, right? You know, when it first came out, the reasoning capability wasn't there. But until, you know, September, the OWEN model out, right? Now we finally, the model has the reasoning capability, but it will take a few more iterations to get to a level that the technology is mature enough to do a lot of the, not just the less hallucination, but also can take actions with higher confidence, right? Enterprise, think about it, right? You know, people want higher accuracy. Unlike consumers, when something is wrong, hallucination, ha, ha, ha, right? Yeah, try again. Yeah. [00:06:30] John Furrier: Enterprise. [00:06:31] Howie Shue: More detection. We missed it. Oops. So that's the technology side, right? Yeah. But the more important part is the data. So, you know, the AI is not going to make a huge inroads into enterprise unless you get married the technology with the data. But what does the data mean, right? Data is in different departments, has all sorts of the tribe knowledge, you know, even without AI, we have a hard time to understand what data do we have? Do we have the comprehensive data? Do we even have the right data, right, sitting there? So without the context, without the data, AI is not going to make a huge difference. So now we are at the point that technology is getting mature to a level that, you know, I want to say it's not a bottleneck, it's less a bottleneck. The bigger bottleneck is getting the data. How to marry the AI versus the data is, I want to say it's a science, it's not a playbook. People know left and right. Every enterprise is different. So we are in that stage, but I have no doubt. [00:07:34] John Furrier: But that's just the momentum of where it is. It's not so much a vote on viability. [00:07:40] Howie Shue: Exactly. So that's why when MIT report came out, I was like, I mean, why do you even report that, right? We're in the middle of doing that. It's all failing. Like, this is expected. [00:07:50] John Furrier: Edison failed 10,000 times before he invented electricity. [00:07:53] Howie Shue: Exactly, you know. By the way, electricity didn't make a real dent in human's life for 20, 30 years after it was invented. So I think, you know, this time, it's not going to be 20, 30 years. [00:08:05] John Furrier: So it's not a bubble in the sense of what we know as bubbles. And the most famous bubble that we lived through was the internet.com bubble. And that popped. And then it was carnage everywhere. People lost their jobs. Families were impacted. It was just so terrible. Highway 101 was empty. It was terrible. However, there was no, the demand curve wasn't as strong because people were onboarding to the internet. Mary Meeker used to have her famous, she was the analyst at Morgan Stanley at the time. She had a famous chart that she would chronicle all the online population, internet population, user population. And it would go up because the internet was great, right? Who didn't like the internet, right? So the web, the web was growing. And so that was fact. And all the fiber laid down. I don't think AI has a demand problem. Okay, I think-- [00:08:51] Howie Shue: AI doesn't have a demand problem partially because a lot of things we wanted to be autonomous is what we are otherwise doing today anyways. [00:08:58] John Furrier: Here's my point. It's why I want to get your reaction. Because if the internet built faster everything, that might have accelerated a little bit of the online population. But today, my premise is if you have great AI, it will be consumed. And you can see that with ChatGPT. So your point about the consumer side, which I want to pivot to, is that we all love it. It's changed our lives. People are getting better at it and adopting it. They're infusing it in how they do business. I was talking to some folks in Silicon Valley recently and they're building a platform for ad insertion. Not like a display ad, but like data. So why wouldn't a brand want to be available? Because people are using ChatGPT in their daily life. So there it is. So okay, if that's where the eyeballs are, [00:09:43] Howie Shue: or the people, why wouldn't you want to have ads? I think we're still bottlenecked by the compute resource. And as we all know, compute resource is also bottlenecked by the build out of data center, electricity, that kind of things. And every, you know, with the open AI, anthropic, they all went at least the order of magnitude more in terms of the compute capacity in the last two years or so alone, right? So I think, you know, the, my premise is AI technology is still at least the order of magnitude, if not too order of magnitude, too expensive. Arguably too slow. Arguably, you know, it needs to be a lot more accurate. But I see it's coming, all right? It's not like there's no, there's no. [00:10:26] John Furrier: I would point out too, and you saw this, that the internet was a consumer first, enterprise second, even though people had intranets. I mean, I was working at HP, Hewlett Packard in 1995, and they think they had the first intranet. I mean, it's basically DNS. They had all that internet technologies, essentially an intra-web, an intranet. Yeah. And yeah, great, they had an intranet. Big deal, click on a document. But the enterprise adoption on the web was much slower than the consumer. So the question for you is, as you talk to developers and young guns and seasoned pros were coming back, what are some of those consumer things you're seeing? Because in the internet, we had breakout brands. Yahoo, eBay, and the list goes on and on. And with the cloud mobile bubble, or growth, we had Airbnb, Dropbox. So, SaaS created new brands that were basically kids in the dorm room, kids coming together, entrepreneurs. Will there be a breakout in the consumer? Do you see anything? I mean, is that the pursuit of the holy grail by the young developers? [00:11:30] Howie Shue: We're not seeing, we're seeing people use AI, consumers using AI tremendously more today than two years ago, than three years ago, right? But whether you like it or not, ChatGPT or maybe Gemini a little bit more these days. [00:11:44] John Furrier: Anthropic too, they've got some revenue. [00:11:46] Howie Shue: No, Anthropic is more enterprise for consumers. It's predominantly ChatGPT and then Gemini. If you count the prosumer, if you include the developers, then the cloud code, the cursor of the world, they have a lot more adoption. But consumers and then prosumers, so we don't see too many very big variety of the consumer AI native applications. Part of the reason is ChatGPT is pretty good. Gemini is pretty good. It's very good, they're very good. They're very good, right? Think about Gemini. They already connect, well, as long as I'm allowed to, you know, it can connect to my Gmail, connect to, you know, so it's very good. ChatGPT, it's not just a Q&A, it can do a lot more things. So these two applications are pretty good. A lot of time, people have new things. People say, well, isn't that just the ChatGPT wrapper, right? So that slowed down the innovation a little bit. But I don't think that's going to be the norm for too long. My prediction is in three years, there will be, you know, just like Instagram for mobile world, YouTube for internet, there will be new applications. That's not tied to the old guards. I think I'm pretty sure-- [00:12:58] John Furrier: And you think there'll be room for people to come in and sit next to OpenAI on the app side? [00:13:04] Howie Shue: Yeah, absolutely. I'll give you an example, which is dear to my heart. Browser, right? You know, we discussed the Netscape. Netscape is generation one. Of course, IE sort of eventually took over because-- [00:13:15] John Furrier: Internet Explorer, people don't know what IE is. IE is Internet Explorer. From Microsoft, people do not know. The monopoly who beat Netscape, that's a historian. We'll leave that to historians, but yeah, gen one. [00:13:26] Howie Shue: So gen one, Netscape to Microsoft Internet Explorer. Gen two, it's the Google's Chrome, right? Which started taking over the browser 2008, 2010, and then by 2012, 2013, it became the dominant browser. That world didn't change for almost 13, 15 years. Yeah. It's time for that change. Now, you may argue, well, Chrome may change, but let's leave that aside. [00:13:52] John Furrier: No, no, I think you're on the right-- I think I like your path because let's just kind of chronicalize what happened. This is good. Yeah. For folks who don't know, a little history lesson here. So when Netscape came out with the first browser, everyone went, "Oh, wow." And by the way, their stock popped. They became the most valuable company. At that time, it was very open AI-like. Which is why-- It's sitting in the building that Netscape went IPO. I know that building very well. Been there many times, talking to the Netscape folks. But let me just explain. Because so, everyone was so excited about Netscape. Mark Andreessen, my friends Greg Sand, he wrote the business plan for Netscape, the founder of BitGo. He's from Netscape, as I mentioned. So, Netscape was the winner. They were the open AI. They were the open AI. At the time. Internet, the gold rush, blah, blah, blah, blah, blah. Okay, in comes Microsoft. They were OEMing Spyglass browser, and they were building their own. Internet Explorer or IE3. Joe Belfure and all the teams there knew those guys too. What they did was they tied the browser to the Windows. The system software. Windows is the operating system, as you know, for the folks out there. So we saw the beginning, and that was considered bad behavior. And the government, the DOJ broke up. I have this debate with Dave Vellante all the time. I think that was about other collateral damage. Microsoft was told that they were a monopoly. Netscape complained. Jim Barksdale hired the lawyer, I forget his name. And they tried to break up Microsoft. So that was the beginning of what now is a feature. So tying the browser to the system software, the OS, Windows, was an advantage. It was actually genius by Microsoft. Competitive strategy 101, you know, job's not done until Netscape doesn't run. That's what they did. And they did that and they were broken up. Fast forward to SAS, tied to the cloud. Not necessarily the same company, but kind of an operating environment. Large scale, horizontally scalable. Don't need a data center. We saw that kind of nestedness. So, okay, now comes the AI era. So I like the thesis. So Chrome, I was in the room when Sergey and Larry launched it. And Sergey, I asked Sergey directly, is this going to be tied to Android and Google as system software? And he, and the PR people were coaching him. Don't answer the question. And he smirked. And Karras Chris was right next to me in that meeting. What did you ask him? And he smirked. And I knew it was. And what Chrome ended up doing was syncing up with all your services. Gmail. So again, scratching the shirt, a little bit gun shy with all the regulatory. They didn't flaunt it. They got away with it. [00:16:28] Howie Shue: But I think-- They flourished for two reasons. One is the, you know, technology advantage, right? It was much faster than IE when it comes to JavaScript kind of the thing. But the other thing is, they still play the distribution game. Because eventually they won because of the distribution. [00:16:43] John Furrier: They won the distribution, it was faster, so better product. They had the distribution and the nestedness in with Google services. And at that time, Safari and Firefox were the dominant browsers, if you remember. If you remember Firefox, it's still around, but okay, so Chrome. So I like where you're going. So now, let's push forward to the AI era, open AI. I like that browsers have this native systems hooks. Yeah. Call it hooks. Data hooks. Open AI hooks. Look at perplexity. People who use the perplexity browser love it. So I think the browser wars are going to be back, Howie. So take me through your thinking. [00:17:19] Howie Shue: This is the third browser war, right? The IE versus Netscape. Chrome versus IE. Now it's kind of the everyone else versus the Chrome. The browser, the third browser war is going on. I don't know what's your definition of AI browser. Unfortunately, a lot of people tie AI browser with agentic browser. I think it's wrong. Agentic browser is okay. Hey, you know, doing some funny stuff like a, you know, type of command. It will open up the tab. Yeah. You know, log on to my Amazon.com. Do things, right? I think it looks fun, but I don't know if it's really useful. Yeah. That's the agentic browser. I don't know if it's useful enough today. But there is another kind of AI browser definition, which is my definition for foreseeable future, which is companion. Meaning that you do all the browser stuff. There's AI, be your companion and then make a recommendation for you. Remember things for you. Be your brain. Be your, not be your brain. Be your partial brain. Be your partial memory. Yeah. Be your partial memory. Yeah. So that you are augmented. [00:18:24] John Furrier: I think you're, I think you're right. And I would, let's unpack this. This is kind of the frontier of what's happening. The word browser came about because the web had a browser. You browse sites and that was the user experience of the utility. Yeah. You go to a website, you browse and you click and you do shit. Okay. We're not in a browser utility. We are in a user utility of getting things. So the browsers would be discovery and navigation. You discover a site and you navigate to a destination. That's the search engines. You click destination, URL, navigation. These are words that are used in that area. [00:19:00] Howie Shue: By the way, I want to broaden that definition even. What? I want to say browser is my entry point to my digital world. Whatever the entry point means. It could mean navigation. It could be my memory. It could be autonomously doing things for me. [00:19:13] John Furrier: Well, I'm saying browser is an irrelevant term for what you're saying because what you're saying is we do things differently now because what we do with the internet is not just browse. Yeah. It's native app. I have now a lot of applications. Yes. I have a lot of applications that I use. They have different identity systems, different utility. But I also do a lot of things that are kind of horizontal. I could be at work. I could be at play. I might want to buy movie tickets. I might want to go to a play. I might want to go to an event or talk to a friend. Yeah. These are utilities. Yeah. This is like internet usage. Yeah. So I think the word browser, so okay. [00:19:47] Howie Shue: I view browser as the AI era consumers operating system. [00:19:50] John Furrier: An interface to the world. Interface to the digital world. An interface to the digital world. An interface to the digital world. Let's just leave it at generic. Call it Howie. Okay? That application. So if you believe that, then you say, okay. What's the underlying system software? So if we were tying in the advantage of native experience, I think what perplexity is doing is you get down to the root level of data. You want to get at the data. So the question is, what is the system software of the internet now in the AI era? It's a multitude of language models. You got cameras on everything. You got autonomous vehicles. You're contextually situational. Right. [00:20:27] Howie Shue: Connect to your personal data or maybe if it's a browser for the enterprise. Yeah. Your enterprise data, right. You know, tool use. The connection to the data. Not just answering questions for you, but also, I'm sorry, loading a page for you. Answering questions for you. Be your chat. Yeah. But also taking actions for you. Yeah. [00:20:46] John Furrier: So look, I like the companion angle. I think that's a great way to start thinking about it. But there's more. Okay. So if that's the case, lay out the playing field. If you were sitting here advising OpenAI or starting a company, what would we do? What would be the land grab? To me, it would be like, okay, reinvent a new app that consolidates everything. It could have agentic, but it's got to be personalized. I mean, all the healthcare benefits I'm covering in AI is personalization, precision medicine. So precision, personalization, accuracy, where's my data? Do I store it somewhere? So there's a lot of things missing in the picture of what could actually work. I mean, that's my, I guess that's my question. What's required to make it work in your mind? [00:21:30] Howie Shue: I think it's similar to the enterprise world. I said that there are two things that's sort of a, I want to say bottleneck, that's sort of slowing down the adoption. One is technology maturity. You want the gen AI to be having better reasoning capability, less hallucination, right? That's technology set. But you also want the technology to have access to the right data at the right time. Same thing with consumers, right? So think about it. I do so many things every day. Can AI help me to remember things, right? Can AI help me to distill the insights, right? That's sort of the data access or whatever my eye sees. Hopefully AI sees the same and they can amplify the insights that human would do. So that's that angle. But the other thing is the technology side. You know, the multi-modality, right? You know, the accuracy. I think we need both advancements. [00:22:21] John Furrier: I want to talk about OpenAI. We were talking, and you and I were talking before we came on here, this pod episode, around OpenAI, and we're talking about job loss, where people fear for their jobs. You've been hearing some rumblings or observing that most people... [00:22:35] Howie Shue: Yeah, you were asking me what did I hear during the holiday, right before this show. You know, the biggest aha moment, I want to say aha moment. The biggest surprise to me is I met so many engineers, researchers from Meta, OpenAI, Anthropic, right? You know, dozens of them in the last two months. And of course I met so many other people. And the surprise thing is, people from OpenAI and Anthropic, they worry whether I still have a job three years from now, far more than the rest of people. Far more. What are they worried about? Because I think they see that the technology can do so many wonderful things, right? You know, it can even do research. It can, you know, build models, right? It can do coding. Sure, you know, coding is still not mature, but guess what? You know, at least Anthropic, the CEO says, Dario says, 90% of code is done by AI. So I think within Anthropic, they see that being more real than people outside of Anthropic. I actually invited even one Anthropic engineer to my team, you know, and I said, hey, you worked at, you know, Microsoft, one of the division, not long ago, and you were using Cursor of the World. Now you're kind of at Anthropic, why you are telling me that you have a very different view. And he told me the following. He said, before, I see, oh, AI can do this, AI cannot do this, okay. But today, I don't think about that. I said, how do you, what do you think? He said, when AI doesn't, cannot do X, I think about how can I make AI do X? What context does it have? What data does it have? What improvement do I need? So by the end of the exercise, AI can do X. So what I see, what he said, what I see is, AI can do everything. It's a matter of how I'm going to make this happen. But before, I'm just thinking, oh, AI can do this, okay, then great. But otherwise, I do whatever AI cannot do. My mentality shifted a bit. [00:24:35] John Furrier: So they're enabling AI. They're marrying the data to AI. That's just the one big part. Yeah, and I would say in my NVIDIA coverage, the one thing NVIDIA is doing right now, they're bringing NVIDIA's AI to telco. They're bringing AI to things. So I think that is on point. [00:24:50] Howie Shue: By the way, you just met Jensen Huang not long ago. What is the biggest aha moment or insight you got from that interview? [00:24:57] John Furrier: Well, first of all, I had many interactions with him. That was my first CUBE interview. He was at the GSA awards. He got the award, obviously. Yep. Broadcom came in second, or got a different award, but basically came in second. He is an authentic person. Okay. He is original and authentic and trusted person. I think he's a good executive, great leader. He answers every question from memory. In an authentic way. He doesn't have talking points. Now, he's got things he repeats, but he doesn't have scripted talking points. He is authentically answering questions all the time. My big aha moment from Jensen, and I was a little bit biased. I'm looking for things for my puzzle, and putting the AI puzzle together. My big aha moment is that AI factories term. That basically means that infrastructure, the hardware, a box, the god box, what do you want to call it? Is going to have different form factors. And we're going to have a distributed computing, heterogeneous environment. In the space? In the entire world. And whoever can deploy a solution, call it a size of a DGX box that they have, or a big rack and data centers from central systems and data centers that are building out to the edge. My big aha moment was, we're going to have micro factories, subnodes, like a metro. Remember the old internet days, you had metro points of presence. Yeah, yeah, yeah. For dial-up, big fat pipes. Yeah. In the region, in the major metro areas. Yeah. So, I think, pop. A pop, yeah, a metro pop, they call it. So, I think we're going to see factories at the edge very quickly. Smaller device that will enable the real world reality to have more AI. The models coming in, either watch through some sort of programmatic utility, like a co-pilot or an assistant, as you say. Where if I'm going to go into a shopping store, or I'm going for a walk with my dog, or whatever. [00:26:53] Howie Shue: So, intelligence is not just going to sit in the giant data center, but also pushing to the edge. [00:26:57] John Furrier: It's going to be pushed to the edge. And be completely real-time generative. Meaning, if I'm walking my dog, or going shopping, and I walk into, say, Nordstrom's. It's now going to be able, with some good programs, and it doesn't do this today. Go to my PC and see what's in my inbox. Or know what's in my inbox that I'm thinking about buying. And then letting me know with computer vision, oh, here comes John. Authenticate me, because I maybe opt in. And then, oh, that coat you wanted. [00:27:24] Howie Shue: I'm curious, why is he optimistic about that being the reality soon? Because if anything, you know, my laptop or edge is still not as intelligent. [00:27:33] John Furrier: Because intelligence is token driven. Okay, so more tokens, more compute, more GPUs. So, you know, a factory is raw materials in, output out. You know, I want to build a car, I get supplies come in. It's data in, tokens out, or outcomes. So, basically, pop is going to be more and more powerful. Yeah, and so, Jensen didn't say this, but I put the dots together. I think New York City will have its own cloud. Private cloud, or multi-tenant cloud. Because if you have an edge that has a factory, you're going to have carriers like AT&T and Verizon and T-Mobile, with services to consumers. We all have phones. We have access to unlicensed inspection, which is Ethernet. Good for backhaul, by the way. Connected to a box. Radios could form a mesh configuration. Blanket, RF, via transceiver to the internet. And then, with spectrum and unlicensed spectrum, and licensed spectrum merged together, you have untethered access that could be policy. So, for example, if you're an AT&T wireless customer, and you could come in. If it's a business account, oh, here's the business, Howie. What's the AI factory will figure out what your needs are, provision for you, instantly provision, VPN, cross networks. I mean, it's a little bit of a stretch, but that's plausible now. It's only possible if you collapse the edge, hyper-convergent with factories. Okay. Now, if that happens, which I believe it will, and we'll find out at MWC, so far the thesis is panning out. Right. Then you have a micro factory in between. Okay. You have metros. So, why would I want to go to Texas, or wherever these data centers are? And then, you know, in New York City, cloud would service, homeland security, EMS, hospitals, consumers, independent of what they subscribe to. Their wireless carrier, their ethernet provider, businesses, opens up, you know. So, I'm looking, by the way, I'm looking forward to that day. [00:29:30] Howie Shue: Speaking of browser, I want my Neo browser, by the way, that's the name of my product, the Norton Neo, the browser to have that level of intelligence. But I can say, today, intelligence is weak on the edge, because, you know, the 70B model, 30B model, is definitely far better than 3B model. So, today, it's-- What is the edge? What's the limit? What's the blocker of the edge? Is it connectivity? Is it data? No. I think there is an intelligence big shift, when you go from a 1B, 3B model, to 30B, 70B model. There's a big shift. So, we haven't cracked the code, how to make the, sort of the 70B model, 30B model, to, you know, 1B model. We haven't done that. That's why, you know, whatever the model on your cell phone, on your desktop, is still weak. Because it's smaller. Smaller. That's smaller, just a huge difference. [00:30:23] John Furrier: Yeah, or you could distill down the big models, [00:30:25] Howie Shue: and shift it to the edge, maybe, you know. Yeah, but then you have to do very finite things, right? As long as it's kind of a general purpose model, we haven't, as an industry, we haven't seen big success. Yeah. That's part of the reason, you know, you probably are disappointed about your, you know, iPhone local model performance so far. Yeah, yeah. [00:30:42] John Furrier: I mean, it's not as good. It's enough horsepower. But, okay, great. So, let's take this next step. So, if all that compute and productivity, is coming with its intelligence, that's going to change how we work. So, I want to talk about Elon Musk. You have a feeling that he succeeds with less people. And so, this is a classic, too many cooks in the kitchen metaphor. This is very interesting. In the old days, you throw a lot of engineers at a project. You get a project lead. You've been on many of those teams. You've led those teams. Yep. Now, in the entrepreneur circles, the solo entrepreneur, first unicorn that's going to be a solo. That's a big discussion. It's kind of a meme. But, you know, you can do more with less with AI, generally. Yeah. So, startups to big companies. Is the successfulness smaller, not bigger? [00:31:29] Howie Shue: Yeah. I think, you know, there are two angles here. One angle is Elon angle. The other one is semi-ultimate angle. Even though these two people... Hate each other. So, let me give you my thinking. The semi-ultimate angle, right? You know, he has been talking about one-person unicorn for about two years by now. What he really meant is, well, in the past, I have to hire this guy to do this, that guy to do this. But guess what? The ChatGPT, you know, democratized this, right? You know, of course, I still need a lawyer. Yeah. I still need a financial guy. But, a lot of the basic knowledge, ChatGPT would give it to me. I don't need to sort of... So, that's his premise. And I don't think it's a one-person unicorn, but I think a much smaller number of people can potentially make a company bigger. I have a friend who said, I wanted to make sure that when I go IPO, I have less than 100 people. That's sort of the... Because of AI. So, that's the semi-ultimate... That's a North Star. [00:32:25] John Furrier: But that's a first principle. Do more with the smarter people. Yep. That's a Steve Jobs kind of vibe, too. It's like, okay, hire the best people, surround them with eight players. [00:32:35] Howie Shue: Yes, but all of that is, you know, do more with less. But, I think a semi-ultimate angle is, a lot of the previously domain knowledge is being democratized. So, that you kind of... One human plus AI can be, you know, powerful. So, let's talk about Elon Musk. [00:32:55] John Furrier: Elon Musk is a slight different. He's got a track record of doing this. It's not like a one-off. Yeah. XAI came out of nowhere. Smaller team. [00:33:02] Howie Shue: Autonomous driving, right? You know, the Waymo has been there for so many years. At this moment, you know, it's still controversial, but there's a chance that, you know, RoboTaxi or the FSD is going to be far more successful than other people who have been doing this for a longer time. And then, that's just one example. XAI, right? You know, I mean, not long ago, people said, "Oh, the only credible players are OpenAI, Gemini, Anthropic, and maybe Meta." At this point, no one counts XAI out anymore. XAI is a very credible, you know, tier one frontier model guy. Why is that? And then, you count the number of people. It's like far less, right? I think, I have been thinking about this for a long time. At one point, I was like, "Hey, Elon Musk is smart, a first principle, you know, unique guy, right?" But the company wouldn't be where, why can do this with one guy only. And then, you know, over the last few years, I realized, it's not just, Elon just made sure that his way of thinking is populated in the entire company. So, just last week, I visited one of Elon's company. I took my team to, you know, visit there. And I have to say that I came out of this, you know, the building, I was like, I embarrassed myself because their mindset is, "Everything is possible." Like, you know, hey, in the enterprise world, hey, let's schedule a meeting with my client the next Wednesday, let's figure out, right? Their question on the Friday, right now it's three o'clock, right, their question is, "Why can't I have the meeting four o'clock?" Like, why do we wait for next week, right? Their mentality is different. If they don't, I mean, I feel like, you know-- [00:34:37] John Furrier: Is that founder, is that founder mode, or is that actually more of a way of doing business? That's actually very interesting. [00:34:44] Howie Shue: That's a very, I think what's happening is, Elon made the founder mode a reality for a big company. [00:34:53] John Furrier: He took founder mode and made it contagious. [00:34:54] Howie Shue: Yes, because a founder mode works very well when you have two people, five people. It works all the time, or not all the time, a lot of time. But when you have 50 people, 500 people, 5,000 people, I mean, there's no founder mode for entire 5,000 people. But he somehow made the founder mode for 5,000 people. That's an amazing part. [00:35:13] John Furrier: Yeah, and I think that's a great point. All right, Howie, so as you look at 2026, one of the things I've been saying on theCUBE, and I want to get your reaction. I've been saying, this is not a year of strategy risk, but an execution risk. Because strategies are generally AI apply to the data, generally is a, you know, global statement. A little bit oversimplified, it's different for all companies. But the winning hand is marry the data. Marry the AI to the data. That's the key to success. That's clear. You said that. Okay, you believe that to be true. So that's a strategy. [00:35:45] Howie Shue: That's a high level. Our strategy this year is marry-- By the way, since we have been around the block enough times, you know, I no longer believe strategy. You know, I feel like even you take a random strategy, as long as you have the good execution, you can be super successful. [00:35:58] John Furrier: Okay, this, I think, if you look at all the successes, the MIT study you mentioned, all the things that I see working and not working is coming down to just straight up execution. Ali Gazi sat in that seat two months ago. He's like, forget AGI. Yeah, if you-- His quote was great, I'll just say it to you. He said, if you went back to me eight years ago and said, what's AGI? I would show you chat GPT today. And, but the goalposts keep moving because it's a philosophical thing. Yes. He goes, I go, so you're down on AGI? No, no, I'm not down on AGI. It's a North Star. Yeah, it's a vision. He goes, let's just try to solve today's problems. And his point was, because he sells to the enterprise. Yeah. They're not actually executing. They're a little bit too boiling the ocean over. So I think execution risk is going to be very, very big. For startups, the execution risk is product market fit. For enterprise, it's a lot of brittle working systems that could be abstracted away with agents. So that's a data problem. So this is my thinking. So what's your reaction to the execution risk? [00:36:58] Howie Shue: Okay, two angles I can think of. Enterprise and the consumer. Let's first talk about enterprise. You probably know that, you know, instead of combating, this FDE sort of the notion is a pretty big thing. What's FDE? Forward deployment. Oh yeah, yeah, exactly. [00:37:12] John Furrier: Right. [00:37:13] Howie Shue: So what is the gist of that, right? To me, the gist of that is lending the technology for real so that we don't have meetings and the meetings. Just to sit there next to the person you want to solve the problem. That's called a forward deploy. Meaning that, you know, when we say that, you know, how do we lend the technology? Let's actually solve the problem from the beginning. Here's the pinpoint. Let's write a code. Let's test it in one afternoon sitting together. Yeah. That's forward deploy. [00:37:39] John Furrier: So forward deploy engineers bringing engineers to the front lines. Yes. That's what you're saying. Yeah. And that applies to solving internal problems. Where's the data? [00:37:46] Howie Shue: Let's have discussions. [00:37:47] John Furrier: Integrations. Yep. For agents. Yes. Because agents need a little bit of delegation. [00:37:52] Howie Shue: Needs the context. Yeah. And also need to figure out, you know, hey, do you lay a multiple layers? Because agentic stuff can be powerful, right? You know, you may have a 99% accuracy, but when you lay out, lay, you know, 30 things together, that's... [00:38:06] John Furrier: So you and I, you and I are both in the same, same religion on that. I huge fan of forward deployed engineers, FDE. So how do you know if a company's doing FDE or not? What are some of the signs that would say that company's deploying their engineers forward? Speed. Speed. No, what's that? What would it look like in the company? Would they behave like an IC job? [00:38:24] Howie Shue: Oh, that's actually very interesting. Org redesign. ServiceNow CEO was, you know, in the fireside chat a long night ago. I was right there front row. And he said, you know, today's orgs are not going to survive the AI era. Whatever we have, sales department, marketing department, and within the marketing department, there are eight different sub-departments. That sort of orgs are not going to survive. We see that. With my company, my CMO is redesigning the org. And then my CEO is also rethinking about the org. And every Fortune 500, Fortune 2000 company have to do that. So what's the sign? If you still have the same old department, same old process, I don't even want to look at it. There's no way you are. It's like, yeah, fail. [00:39:11] John Furrier: Yes. Yeah. [00:39:13] Howie Shue: Yeah. You have to rethink, right? Can one person do, you know, a department's job, right? In the past, it's like, yeah, you can do it, but the quality, whatnot, right? But think big. That's where the Elon sort of-- So here's my thinking on that. [00:39:25] John Furrier: So here's the way I think about it. So an F4 deploy engineer can work in three areas. Productivity will help a department with an app. Yep. Okay. Business growth, integration, a business deal. Okay. And then ultimately, you know, just overall product enhancements. Deliver outcome. Yeah. I mean, better product. So better productivity, better product, more revenue through either integrations, because everything's connected. Yeah. [00:39:51] Howie Shue: Do you agree? Yeah. I think, you know, F4 deploy the thing, shorten the loop. One thing is to expose the ugly truth that in the past we do a lot of busy work, but there's no outcome. But now, you know, you have everyone sitting together, the loop is shortened, and then whether there's outcome or not, it's exposed, you know, either there or not there. So, you know, I think AI is not really making this, you know, from not necessary to necessary. I mean, without AI, we need that. All right. Just the AI made it impossible. [00:40:22] John Furrier: So let's end this talk. [00:40:24] Howie Shue: There is a consumer. [00:40:25] John Furrier: Okay. It's a good consumer. [00:40:27] Howie Shue: Yeah. Consumer angle, it's very simple. In the past, getting application out is a big deal, right? You know, but guess what? You know, I was talking to my colleague just this week. He said, "Well, we will have a product." I paused for a second. And I was thinking, "Why am I pausing when he said we will have a product?" And I realized, five minutes later, because today, product is not a product unless you have a distribution. To me, product equals distribution. So, because of that coding, because of AI. [00:40:58] John Furrier: Explain distribution. Putting it in the hands of users, you mean. [00:41:00] Howie Shue: Putting it to the hands of the user. Solving, you know, people are not going to use your stuff unless you are, you know, solving some pinpoints, right? Identify the pinpoints, you know, making that onboarding experience, you know, all that kind of thing. So, distribution becomes far more important than before. Why is that? Because in the past, you kind of spent three months, three weeks getting application. Guess what? Everything, 15 minutes, you have applications. DocuSign.com, Salesforce.com, I can make it in 15 minutes. Now, of course, not Apple to Apple comparison. But I can make application real fast. But it doesn't matter. If you cannot, solving people's problem, distribute to the end user, it's not interesting. To me, the next decade, maybe not the next decade, even next three years, the real game is distribution for consumers. Awesome. [00:41:47] John Furrier: I love that analysis. It's great analysis, Howie. You're awesome. Final point, and then we could wrap up. I'm going to read you a quote from NVIDIA CEO. NVIDIA CEO, Jensen Wong, thinks that not only is there no bubble in artificial intelligence, but we actually need more investment. We wrote about it on Siliconangle.com. Wall Street Journal had a story on it. This is from Davos. What's your takeaway from that? Now, they're in the business of selling infrastructure. So, of course, more investment helps make more money. But, does that hold water in your mind? We need more investment. [00:42:20] Howie Shue: I think there are two types of investment. I think what Jensen Wong wanted is, you know, more electricity, more data centers, so that he can sell more GPU cards. You know, there's a reason he wants-- [00:42:33] John Furrier: They're systems now. They were cards. Now they're like monster systems. [00:42:37] Howie Shue: Systems. Not cards. We all had our NVIDIA cards. GPU data center. GPU cluster. Whatever that is. Yeah. There's a reason he said that. I think this is always the case, right? Internet, right? Do you overbuild internet or not, right? You know, I remember the day when I saw this is about, you know, roughly, you know, the dot-com crash, you know, time. I saw, you know, this is the pop, right? The major pop, Chicago, Virginia, major pop. Internet utilization at that time was 8%, 5%, 4% utilization. That's the major sort of the pop. And I was like, okay, we over build the internet. However, guess what? Within three years or I don't know how many years, YouTube of the world, right? You know, just Netflix, you know, utilizing the entire internet. So you always want to over build infrastructure for, you know, at a given time. I think we are at that stage. We are over building, maybe, but we have to over build it. That's one investment we have to make. But I always say one more thing when it comes to investment. We have to invest in how to get people to survive and then thrive. And then thrive in the AI era. That's something I'm very passionate about. Because the question you asked me, what do I see? I said, people working at OpenAI worry about the job security. But what about the rest of the 8 billion people? There are only a small number of people working there. 8 billion people, how do they survive and then thrive in the AI era? I'm very passionate about it. And I think that needs investment. I think that needs a bigger investment than the data center, in my opinion. [00:44:06] John Furrier: Yeah, I mean, they go hand in hand because the utility of the AI is so good. It's how you drive the AI or use the AI, whether it's your creative, whether you're curating. I mean, so many things that you could do with AI. But if you go head to head with it, you're going to lose. [00:44:22] Howie Shue: I'm in New York this week, you know, my entire leadership team is thinking about how do we make AI relevant to users, consumers, so that they can unramp to that era better. [00:44:35] John Furrier: Well, as the Chief AI Officer of Gen Digital, thank you for coming on. Also, CUBE, contributor in our CUBE Collective. Really appreciate you sharing your knowledge, opinions, and you're always on the ground. You're like a reporter, but you're also the Chief AI Officer of our company. I'm so happy to go back to Stock Exchange and then CUBE. [00:44:54] Howie Shue: What do you think about our new set here? Pretty, not too shabby, huh? Well, it's actually always so inspiring, right? You know, you told me, why did you do this? Because you want to, you know, because you believe that the tech is the capital, right? From my point of view, marrying the capital and the tech is very important. Just like how to unramp people, you know, on this floor to understand, to appreciate the technology. I think you are the front line. [00:45:19] John Furrier: Yeah, well, technology is the market in all categories. Technology is in politics, technology is in business, technology is in our lives. And to your earlier comment, I totally agree with you, is that it's the reality that we live. That's called physical real world. That's where AI is going fast. So everything's, I mean, it's a great time to be alive if you're an engineer, entrepreneur, business person, or just a human. [00:45:42] Howie Shue: Speaking of the best time, you know, great time to be alive. I mean, I've been in Silicon Valley for so many years. This is for the first time I feel like every day you wake up, there is something new. Yeah. Something, not just new, something amazing about technology. [00:45:54] John Furrier: Well, I like it because we're both nerds and geeks. We love tech. We love building things. When you see technology just open up to everything, and the technology is changing fast, as is the experience. It's like the perfect story. It's almost, it's somewhat intoxicating. Yeah. [00:46:12] Howie Shue: It's really fun. Yeah. That together with everything changing, the politics, geopolitics, it's an interesting time. [00:46:19] John Furrier: Yeah. We're across the threshold, Howie. We are seeing AI come onto the scene, and it's super relevant. We've been, anyone who studied computer science knows that AI theory we took in class, or maybe coded something statically, is now happening. It's like, "Oh, it's this. I know this." [00:46:36] Howie Shue: But it's getting better. So, technology in Silicon Valley, you know, finance, Wall Street in New York, and then, you know, the Washington Beltway politics. These three things are together, for the first time. [00:46:48] John Furrier: And that's why the NYSE Wired program, Cube Original, brings together that capital markets and tech, and the community as a result is open. So, we're bringing that open community, and we're seeing just great participation, because people are hungry. How does it impact me? How does this tech impact my life? What does it mean? It's very nuanced. No one knows what HBM is. No one knows what FDE stands for in the mainstream, but it's been changing everyone's workplace. Now, project managers that never dealt with engineers, why is the engineer in the meeting? Well, he's going to build the app by tomorrow to solve your problems. [00:47:25] Howie Shue: When you're back to Silicon Valley, I want you to come to the Netscape building, the former Netscape building, the fountain you knew, right? And then, you know, do another talk. [00:47:34] John Furrier: I'll bring an old PC I have, and I'll try to boot it up, and we'll stand it outside and have some fun. And maybe show you a Netscape. Howie, great to see you. You're also a great contributor. I'm John Furrier with the Cube. We're here as part of our NYSE Wired program and community, bringing you all the tech as technology as the market is driving all social change. It's creating the consumer disruption, utilities changing, and the businesses will be impacted because they reach those consumers. It's B2B2C. They're going to bring their data to the AI. The AI will go to their data and all new things will happen. Things we haven't fathomed as quantum and crypto and AI come together. We're going to see the digital and physical world completely converge in a first party basis. Of course, we're doing our part to bring that technology market coverage to you. Thanks for watching.