HP’s Alex Cho: The PC isn’t dead. It’s essential.
HP Personal Systems had a banner year in 2020, but not for the usual reasons to do with the health of the PC industry. Rather, it was the pandemic that drove people into their homes for work, with the subsequent need for adequate computing technology.
I spoke with Alex Cho, president of HP Personal Systems, about his company’s plans for CES 2021, the annual tech trade show that’s not in Las Vegas this week. He said the pandemic showed that people who worked from home needed to have a hefty machine to do their creative work. They had to transform their homes into protected enterprises that were safe from hackers and fully equipped with the printers and networking gear to support households contending for resources.
Now HP is unveiling a new round of products, and the marketing is all focused around the home workplace, rather than machines for your commute. Cho also thinks gaming will continue to grow in 2021, despite the record year it had in 2020 as people played games to distract themselves from reality.
I talked with Cho about HP’s lineup of new products at CES 2021. We talked about his expectations for growth in 2021, the future of computing, and the new competition between companies like Advanced Micro Devices in HP’s supplier base. One thing is clear, Cho said. The PC isn’t dead. It’s essential.
Here’s an edited transcript of our interview.
VentureBeat: It’s a very different CES this year with the digital format. I imagine that’s changed up what you’re doing.
Alex Cho: It’s an interesting complement to where we’ve already been innovating. While it’s logistically different for us in terms of how we show up to the show, the fact that we’re remote — it’s like the ultimate background for our announcements because our announcements are all about enabling how people work and learn and play and are cared for in a more remote environment. It’s an interesting play on both the logistical difference, but also the impetus for a lot of the innovations we’re announcing.
VentureBeat: I noticed that all the images in your deck were of individual people working at home in some way. Normally you’d have lots of office settings. That’s totally different. It seems like how you sell has changed, how you market.
Cho: If you take a step back, this category is one where — it wasn’t long ago that people were saying the PC was dead. Then a couple of years ago I was advocating, saying that if anything it’s becoming increasingly relevant. I was sharing some of the first-party data around usage, the ultimate proxy for the relevance of a category. Usage was growing in things like creation on the PC, consuming content, collaborating. Especially among Gen Z and millennials.
2020 happened and now the category is more than relevant. The PC is essential. That’s what you would have heard from us last year. The PC is essential. You’re not working if you don’t have a PC. You’re not learning. You may not be seeing a physician. This whole idea of people connecting. The PC became increasingly essential.
As we head into 2021, we’re in the middle of this incredibly exciting category that’s essential, but we don’t want to just focus on the PC. It’s the people. PCs are essential because people are essential. When you mention that you saw people in our material, it’s because we’re focusing CES 2021 on key people who we spend a lot of time thinking about. What is the experience that they need innovation around?
The four segments for us are the hybrid workforce, the SMB, the IT manager, and the youth who are creating so much. Those are the four segments where we wanted to get to know them holistically and deliver a holistic set of experiences for them. That gives you the context for all our stuff.
VentureBeat: The HP Enhanced Lighting looks like it’s very timely as well, for people who’ve consistently had problems with webcams. You’re presenting in front of a bunch of people, but your lighting at home is terrible.
Cho: I call it “everyone wants to be a rock star.” This whole growth in video blogging. It’s growing dramatically. Traditionally people have thought that they need to be connected and sharing content. They want to show themselves. And when they show themselves, they want to ensure that they’re showing up well. That’s very important. Lighting is one key part of it.
Again, we’re spending a lot of time looking at, listening to, and thinking through what might be the needs or opportunities for how people are computing. It’s a great time for innovation. I always loved this category, but now it’s never been better.
VentureBeat: Looking back on what kind of year it was, how did your supply chain adjust?
Cho: This past year was definitely a shock to the entire ecosystem, from multiple perspectives. One was, you had geographies like Wuhan and their factories. You had a much larger topic around sudden increases in demand. Companies needed to equip their workers to work from home for business continuity. Schools needed to ensure students had PCs to be able to dial in for class. Huge increase in demand. A huge mix shift as far more mobile devices, notebooks, and laptops, versus desktops. And then you add in that there’s an entire ecosystem that needs to support the increase, the shift in mix, and enabling that in the devices we ship out.
One of the biggest areas of muscle for us to continue to focus on is being agile. This is a huge, complex business. Needing to build agility is one key element of 2021 as we go forward.
VentureBeat: I don’t know if this blurs the difference between enterprise and consumer, but the fact that the IT manager has to consider what’s happening in the home … Some companies are definitely ramping up products that get used in the home, like enterprise-secure routers.
Cho: That’s why one of our personas we talked about was the IT manager. The IT or CIO of today — here are the challenges. They are serving employees who are largely remote. Remote has many challenges, including security. They’re not in a corporate environment. But you have a lot of other challenges. They can’t support them when a PC breaks down or needs setup. Second is their own workforce is remote, serving end users that are remote. Third, most of their tools have been grown from manageability and security assets that assume employees, IT employees, are in the office. You have legacy on-premises tools.
If you’re the IT manager of today, how do you support the breadth of needs? People don’t just need a PC to stay connected. They want to be productive. They want to be collaborative. It needs to be secure. Suddenly the needs around enabling a hybrid workforce are significantly higher. Enabling IT managers to have the tools that allow them to be better at meeting the needs of their end users is a key part of what we’re continuing to roll out through technology-based and AI-based services for our customers.
VentureBeat: How have the relationships with suppliers changed? Five years back, you had Intel, AMD, Nvidia, the usual places. This year feels very different. What do you observe about that over multiple years?
Cho: You see more diversity in that space. We have already been enabling customer choice. We probably have one of the most diverse portfolios out there. Another takeaway is that this has been an industry that’s been maybe focused a bit more on CPU or silicon players, different elements of that stack. We’ve been very much on — let’s curate the experience. We joke around about how CES isn’t the Consumer Electronics Show for us. It’s the Consumer Experience Show. Which means that it doesn’t matter what each of the layers is. It’s curating that experience, that stack that meets the use cases for how people increasingly use their compute device.
As much as we enable the diversity and choice, we’re very much investing in the engineering to curate the end-to-end experience, whether it might be around collaboration, creation, video content consumption, gaming. Looking across all of that. You see a difference, but what you don’t see is — even acceleration of really curating across the stack.
VentureBeat: Did gaming change for you this year?
Cho: Gaming was great. First thing, the number of gamers isn’t just growing. The number of types of gamers is growing. We have a segmentation that acknowledges there are different types of gamers. It’s far more diverse than ever. The other thing that’s interesting is that gaming is also part of a much broader secular trend, which is entertainment. The PC is increasingly becoming the entertainment platform in the home.
Think about the fact that you had Marshmello do a concert in Fortnite. A year later, Travis Scott did one. The world of entertainment and content and gaming — I don’t even just mean the engines that create them. I’m talking about the experience. Then you add in the fact that gaming is a space where innovation — it loves innovation. People want more performance, more immersive experience. And they want the ability for gaming to not be individual, but social. That’s the last layer. People socialize through gaming. My extended family didn’t get together for Christmas, like we have done for 22 years. We connected remotely through gaming.
Gaming is great. We have massive secular growth, massive changes in the role of gaming. The need for innovation in that space is big. I’m bullish around what that means for our industry.
VentureBeat: Do you wonder whether the boost in gaming that happened this year might subside in 2021? Whether it’s because some other kinds of entertainment and socialization come back or because it’s just hard to beat 2020’s numbers.
Cho: My answer is no. That would be my statement as well for just the broader industry. It’s not a cyclical boost we’re seeing. The behavior shift is more secular here. Even if you could travel — today I can’t travel, but even when I can, because I can remote in with greater innovation and do so with less of a tax, because I can collaborate vividly and so on, then I’ll want to continue to be in a hybrid environment.
Gaming is a great example. Even if people can travel and leave home and so on, their ability to connect with other people, even if they’re not nearby — if you don’t have the resources because you don’t drive, or it takes too long to connect, things like family reunions can be enhanced through gaming. The world of entertainment is rapidly becoming more personalized and gamified. That’s a train that is not dependent on COVID-19. That train was accelerated because of COVID-19, in my mind.
VentureBeat: I see Wi-Fi 6 looks pretty pervasive in your laptops. I wonder about how much people are using that, and whether the optional 5G features are becoming more popular. Is 5G usage something you can see happening?
Cho: At the higher level of connectivity, it’s only more important. What’s interesting is that I remember — this is about 11 months ago. Someone said that if people are sheltered in place, connectivity is less important. This year has proven exactly the opposite. Just because you may not be traveling doesn’t mean — you’re connecting a lot more. We study how people are computing in the home, whether it’s for work or for learning or for play. They’re moving around the home. They’re dealing with challenges of connectivity. They don’t just want to check their email when they’re connected. They want higher-bandwidth computing, whether it’s gaming or movies or videoconferencing.
Security is also becoming a broader issue. There’s a greater need for that. And let me use LTE as a proxy. Our LTE-enabled devices have been steadily growing. I looked at a figure in the middle of last year. We had the highest index of LTE-enabled devices. Whether you’re a hybrid worker, which is our view of the future — even if you’re in the home, though, the ability to not be dependent on traditional infrastructure, which is less secure and has issues with sharing, but to have infrastructure that’s more secure, faster, resilient to wherever you are, ubiquitous ability to stay connected — it’s more than just faster downloads. It’s about doing new things on your devices that you couldn’t because you get to bandwidth, latency, and security that wasn’t there before.
VentureBeat: With 5G, it seems like the use case is you would turn to it when all the people in the household get on a video call or something. Those moments when you have an important call and you risk a hiccup in your connection. That’s where the 5G alternative seems valuable.
Cho: Security as well. There’s still a lot of variability in the security of people’s local networks. If you can make that more secure, that has tremendous value for people, companies, institutions, and so on.
VentureBeat: Privacy cameras and things like that seem pervasive as well. You keep adding that into more and more things.
Cho: We started this. It’s been a multi-year journey as we’ve invested in it and improved it. We’ve had a multi-year journey on security. We expanded, as you know, below the OS at the BIOS level, in the OS, things like secure browsing. Above the OS, related to people visually hacking. We realized that security is part of a broader need and sensitivity around privacy. It’s really security and privacy. Whether it’s in our consumer or commercial lines, having webcams and mikes where you can quickly turn them on or off, ensure it’s off, it can’t be hacked. Screens that people can’t see from the side through our Sure View technology. That increasingly becomes important.
You can take it even further around — in our commercial products we’ve integrated the ability to easily locate and find, through some engineering we’ve done around file integration on the device. We’re thinking holistically around security, privacy, and then asset management. That’s obviously a corporate term, but the ability to make sure this investment is well-managed.
VentureBeat: Circling back to innovation and how the market needs pivoted in 2020, how long before innovative products based on those changes will show up? Are they showing up already?
Cho: I’d say the time is now. The reality is we were already working on this. That’s why, in many ways — COVID-19 has been an incredible catalyst for things we were already working on. In the future, these things were going to be more important, and then bang. We announced Dragonfly Max, the ultimate in collaboration. Significant improvement in webcams so you can be seen better. Multiple mikes so you can be heard better. AI noise reduction so that ambient noise is drowned out. Everything we learned from before, COVID-19 made it an absolute necessity, and at CES in January 2021, we’re there.
Think about all the need and desire to create more on your device. That was there and that was growing, and that was why we were seeing the PC become more relevant. Bam, COVID-19 happens and people’s desire to not only create, but make videos of themselves, video blogging, and do that in all different environments, in your home — you need better lighting. You want to quickly get photos captured on your phone to the PC, which we’re enabling with Quick Draw. You also want to do it not only at your desk, but often on your laptop. We have Intelligent Thermal so it knows how to manage heat more efficiently for different workflows. We announced that in Envy 14.
The other thing is, a lot of people are spending a lot of time on their devices. They’re very sensitive to the well-being elements like eye fatigue. We’re announcing displays in our notebook products with Eye Ease, which has blue light integration, filtering integration, which reduces the strain on your eyes. Again, we were working on it before. It was a nice-to-have future need. COVID-19 happens, you really need it. You’ll see it at CES, and you’ll see a lot more.
VentureBeat: I noticed this blue light feature. Has that started to become very interesting to people? Is there more demand?
Cho: You see the confluence of multiple things. People are used to not turning on the camera. That’s one big shift in videoconferencing. Second thing is, because they’re doing that when they could have taken it on their phone, they’re doing it through a screen. They’re using their eyes a lot more. Third, they also want bigger real estate, big displays, so they can see many more things. All of that is taxing and creating concerns and sensitivity around eye fatigue.
The response to what we’ve invested in as far as making our notebooks and our displays have integrated blue-light filtering, as well, on our latest Envy 14, it’s our first color-calibrated display with Delta E of less than two. That means the human eye can’t discern the difference between what you would see on the display to how the colors are represented in the real world. You want that. Again, displays are an important part of where we’ve been innovating, and the needs created by COVID-19 are becoming a driver of that innovation we’ve been working on.
VentureBeat: I talk to folks like AppAnnie about mobile gaming. It’s maybe 58% of all gaming now. During the pandemic, they noticed that even though people aren’t traveling, inside the home their usage of mobile increased. Even though they have this option to game on the PC or the console at home, a lot of people are choosing mobile. There is a little threat there to the basic PC business, but it also seems like there’s an opportunity for better integration with mobile.
Cho: The reality is, because gaming is becoming more of a lifestyle, because it’s part of a broader trend, we believe it will continue to be relevant beyond COVID-19, and you’ll also see a lot of relevance even in mobile form factors. You’re absolutely right that mobile will continue to increase, and that’s a great opportunity. That’s why we’ve enabled, through our newly renamed Omen gaming app, our online platform. You can connect from your PC and stream to a mobile device and game. Mobile gaming gets a broader set of people engaged in gaming, and they’ll want to participate in gaming even more. They’ll want to do it in a more immersive PC environment. We think it’s a great onramp, as well as a complement.
We also see that with mobile gaming — with games like Jackbox, just as one example, the game itself is played through a diversity of devices simultaneously connected. Whether you’re on your PC, on the phone, on a tablet, all of them become input devices with individuals participating in the gaming. It’s a real business, and we’re designing for it.
VentureBeat: One example from my use, I started playing Call of Duty: Warzone a lot, and I got a chance to play with some people who were experts at it. They shifted the audio call among the players to Discord on a phone, and that offloaded the audio from the game. The game then runs better. You can hear people more clearly. It’s a combination of mobile and PC that tackles some of the weak points you have to deal with.
Cho: The Discord example is a perfect one. We see that. You want to game with other people, let them see what you’re doing and participate, and you have a lot of issues, particularly with these triple-A games that have a lot of content. You get bandwidth issues. What do you do with the one kid who doesn’t have a fully tricked-out PC? They feel left out. How do we innovate with that? We’re all over that.
Gaming is probably the first example — well, “first” is a strong word. But a game is experienced very differently depending on the hardware. In general, we talk about how software adds so much value to hardware, but here’s a case where hardware adds a lot of difference and value to the game. The immersiveness, the haptics, the AI-based lighting, the ability to quickly trigger things, the feeling of the keyboard. That’s why we focus not on the product, but on the experience, to the earlier point.
VentureBeat: We talk about gaming influencing the PC, and then the enterprise influencing what happens in the home. I wonder whether that means some of these things are pushing toward a more common platform of sorts. The consumer market maybe doesn’t necessarily feel so divorced from other categories, like gaming or enterprise.
Cho: That’s definitely a big trend, a significant shift. You would have heard us talking, starting a few years ago, around what we called “One Life.” It was the idea that you don’t just work from nine to five and then move on to your personal life and dealing with personal things. It was about the consumerization of IT and so on. Fast-forward that and now it’s even more the case, especially with hybrid work and learning environments. You work and play and take your breaks on these devices. The platforms you use for one thing — you talked about Discord. I know people who use Zoom while they’re gaming too. You take these platforms that have been thought of as just consumer or just commercial, and you see that they span use cases across both. So how do you bring that together?
I’m happy that we’ve had a very rich consumer and commercial business. We share a lot of technology across them as we think about that. We think about experiences now that span both. Not by customer, but for an individual customer throughout their day. That’s different. It’s a larger trend that is a reason why the assets we have around security are important. The assets we’re building around audio and video that span both areas are important.
Think about Elite Folio. We introduced it in the consumer space and we brought it into commercial, or really SMB. That device — we were following the mantra that a person shouldn’t adapt to their device. The device needs to adapt to the person. When you run an SMB, you’re not just a corporate worker sitting at a desk. You do many things throughout the day. We wanted a device experience that met the diversity of needs. Whether they’re watching video content, because they’re looking at YouTube to figure out how to fix something, or they need to type and stay productive. SMBs aren’t always sitting at a desk. They’re moving around. They can quickly go into tablet mode. It’s always connected.
That’s the type of device that happens when you recognize the commercial and consumer spaces coming together. It’s a profound shift that we believe will drive a wave of innovation going forward.
VentureBeat: If you look out a couple of years, do you think that something will dramatically change the PC or result in a lot of innovation? If you had to predict what that is, what would it be?
Cho: We’re right in the middle of that energy. We’re already seeing some of the benefits from the innovation inspired by COVID-19. The R&D centers at a lot of companies right now are rapidly innovating. You’re going to see that progress not just in January 2021, but over the next few years.
Some of the areas we think will be meaningful — one is far more immersive ambient computing. You’ve seen some of what we’ve done around VR. That’s one example. Computing, what is it today? It’s still a keyboard and a mouse. Now you can touch a screen. We’ve seen some voice through Alexa and devices like that. But it’s going to go through far more diversification and naturalization of input immersiveness.
Second is all the things related to remote computing. You don’t have to be limited by the thing you have at your desk. We’ve been scaling our ZCentral solution. We won an Emmy Award on this. If you’re a design company and you send all your employees home — they have all these big workstations in the office. They’re able to remote in, stay productive, and all that high-performance compute stays secure. The idea that you’re not constrained by just the device sitting next to you, that’s why we won an Emmy this past year.
Third is a lot more AI-based, context-aware, personalized base experiences. We’ve started to do that. At CES, we’ve announced context-based, instant-on cooling just so that it makes things better for all the transitions around your house when you work. I believe that 5G, more than just faster downloads, will truly allow you to do more in more types of form factors. I’m very excited about that.
VentureBeat: How many products do you have at CES? Is that number different from past years?
Cho: I’d say we have a lot of products. We have multiple dynamics that are changing the pure count. It goes down because we continue to find more leverage across platforms. It goes up because we’re finding new use cases, all the ones I’ve talked about. The need for a very rich portfolio of peripherals is growing as well. A big display at home was a nice-to-have before, when you were checking in on work once in a while. Fast-forward to working from home all day long, what do you want? You want a real display. We’re constantly managing a broad portfolio and getting more leverage. We have new use cases. That’s expanding into adjacent categories we’re excited about.
Maybe a bit more unique to us, we’ve been on a multi-year journey of building increased sustainability in our products. In some transitions, we add more products because we’re shifting to a far more sustainable portfolio. We announced last year that we have the most sustainable portfolio, but that’s not only on notebooks and desktops. We’re extending that to displays. We’re announcing a sustainable backpack at CES. We’re looking at packaging. As we do some of these transitions, it’s part of a much broader ambition around sustainability for us to grow.
VentureBeat: Now that you’re announcing the products, how do you get the word out? Is that different this year?
Cho: Well, I’m not personally at McCarran Airport, for one. This is probably where the advantage of what we’re learning from COVID-19 is helping. We’re learning how to be digital-first and digital-exclusive in how we make our content available. But as well, it’s not about just doing what we do physically and then putting a camera in front of it. It’s creating optimized for digital. Bite-sized chunks. Video. If it’s an event, active polling. Breaking up into small groups. I’m expanding into more than just how we communicate these devices, but we’re building a lot of learnings around how you communicate something that is new to people.
COVID-19, in many ways, has forced us to learn because we’re restricted from travel. We must be more digitally enabled. Because of that, we can find new ways. I’m not traveling, but in 2020 I talked to more customers and partners than ever. It doesn’t matter where you are in the world. Breadth and democratization in the ways I can reach you have dramatically improved. As we do an announcement like these solutions for CES, being able to reach a broad group of people, wherever they are, in the format that works for them, without having to commit to flights and baggage and TSA, there are lots of advantages.
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