Qualcomm’s Don McGuire on AI, Software Innovation & Brand Partnerships

Great to be here. Thank you so much for having me.

Sure. I think for us as well as for CES in general, the show has sort of evolved. You know, we have that little COVID thing happen in the middle. But I think over time it has evolved and new things have taken center stage. I think right just prior to COVID and carrying over even to today, CES seems to be a lot about cars. And there seems to be a lot of automotive news and a lot of automotive presence at CES. And then add on top of that this sort of constant narrative and hype cycle around AI. I think those are two of the things. And then traditionally you kind of see the big TVs and the new displays and the new screens and that's always been a mainstay of CES. So, we see a little bit of that here today as well with the transparent displays. Pretty cool. So for us, the last couple years has really been about automotive as a centerpiece with a sprinkling of other things around. And so I would say, 80% automotive, 20% Gen AI is kind of our recipe this year. And we've leaned in on Gen AI across different product categories based on kind of what's being talked about here at the show. So there's like AI PC, which has been a topic here at the show. There's other things going on and so we've kind of leaned in across those different categories. So that's kind of CES 2024 for us.

Yeah, I think it's either been about other industries undergoing transformation. And that's either being driven by software, and like the case of auto, right? I don't think there's any other industry that's undergone in the last 5 years more transformation than automotive where cars are less about mechanics and MPG, and MPH and torque and thrust and all that stuff. It's more about digital capabilities, right? A docking station for my life. Exactly. Or a new living space, right? And so that has been amazing to watch and participate in. And we're a huge participant in that as well as a huge enabler of it. Yeah. So with our Snapdragon digital chassis solution. So that's been super cool to see. But you're right. I mean the software-defined vehicle is now what's driving the automotive industry. So software seems to be driving a lot of the innovation and transformation versus form factor. Right. Or even performance. In some ways performance has become commoditized unless it's in the context of something new. Right. So instead of talking about, for example, I'll give you a PC example or even another device where in the past what you looked for was CPU performance, for example, like how fast is this processor, how fast is my PC, and the ecosystem built a whole narrative for years around hey CPU CPU CPU. But then gamers came about and the conversation shifted in the gaming context to no no it's all about GPU, right? GPU GPU. Well now in advent of the AI PC which has been kicked off sort of last year. We announced our Snapdragon X Elite platform at our Snapdragon Summit in October and the capabilities of that platform. We're going to see that show up in PCs in June of this year and going forward. And then here at the show, the PC ecosystem is talking about the advent of AI PC. Microsoft's launching the Copilot key right on your keyboard etc. But now when a consumer walks in to a Best Buy to buy a new PC going forward 2024, 2025 and beyond, or an enterprise CIO is saying, 'How do I upgrade my hardware, my devices for my workforce,' it's less about CPU and probably even less about GPU and it's more about NPU, right? What is the AI performance going to be on this PC so I can take advantage of all these great Copilot experiences that Microsoft has built on top of Windows? So this shift is happening where the innovation, yes it's software driven but it's also what's happening within the device that's creating this new level of performance. And so that's interesting to watch.

This is a great question because in order for AI to scale both from a technology perspective and a usability perspective, it's going to have to be hybrid, meaning not everything can happen in the cloud, right? In some cases, it takes too long. The workloads are too much, right? The taxing on the data center is too much. The economic model doesn't work, right? You can't buy enough cards to put into your data center. You can't overutilize water resources to cool your data centers. So, you've got a sustainability problem. You've got an economic model problem. And you have a data privacy and personalization problem. So a certain amount of computational work that drives AI and the ability to deliver an AI solution based on algorithms or large language, small language, medium language models is where is it going to happen contextually based on what is it that you want to do. So on-device AI, which has been on device for 10 years, AI has been running in the background, whether you know it or not on devices like smartphones for a long time, right? It's been making your photos better. It's making your music sound better. It's been doing things that you didn't probably know or realize that AI was actually doing that. And AI has been part of our Snapdragon platform for years. It was really Gen AI that thrust AI into the spotlight. It was like the press release for AI, so to speak. Packaged it for consumers. Made it novel and created the hype cycle. But unlike other hype cycles, it's not going to stop, right? It's not going to go up and then go down. It's here to stay and it's moving very fast. But in order for it to scale, the technology that enables it is going to have to normalize across the spectrum of the device itself, the edge, which is really on-prem. Right. So whether that prem is your home network or is your campus network or is your office network. 5G plays a role in that. Wi-Fi 6E, 7, 8 whatever plays a role in that. And then the cloud and the data center in the big cloud. So if you're talking about something like 'hey AI assistant help me plan my day,' most of that can be handled on device and that's instantaneous. It's information, it's interaction that you want at low latency. It's text. It might be some image things like that. But we're talking about trillions of parameters like 'help me solve world hunger AI,' right? That is data center, big computing. It's going to take some time. The latency is not an issue. It's really about getting to the right answer. So it's everything in between there. So it's going to be contextual to what is the task. And if you normalize the technology stack across device, edge and cloud, then it becomes more useful for everybody. You can actually load more tools and more experiences on top of that and you can put them in the bucket that they need to go into to deliver the best experience to the user for whatever that might be. And then that's going to enable the second part which is the usability and the relevance of AI really has to move from prompted and reactive to anticipatory and suggestive, right? If it's going to actually be useful and not just novel. But that means that the user has to be able to let the AI know more about them. Exactly. Right. But it's up to the user, right? Right. Especially in the case of AI at the edge, right? You're in control. The human element is always in control. So you allow it to learn as much as you want it to learn about you and then you allow it to suggest or recommend in the context of your private network or data set. Whether it's on device and it never leaves or whether it's in your home and never leaves or whether in the cloud protected or 'hey I don't care where this goes, train your algorithms on it, I'm cool,' right? So it's everywhere in between. So I think that's really the beauty, the excitement of it all but it doesn't just stop with ChatGPT going to the data center. Sometimes you get a response, sometimes you don't, sometimes it says come back later because it's taxing a resource because everything else has to catch up. And that's where Qualcomm really plays a big role is at that edge, right? So from the on-prem to on-device, it's our sweet spot, right? We've been doing this on device for years. We make kick-ass processors and semiconductors and chips. And we have this long history and DNA in wireless connectivity. Yeah. And Wi-Fi.

Historically, yeah. I mean, you know, since I've been at Qualcomm, what seven and a half years now, we were already underway of this transformation and diversification of less about connectivity, still about connectivity and first class and world leading connectivity, but more about on top of that connectivity computing. Yeah. Right. And which is why, you know, now what we stand for is really intelligent computing everywhere. So the everywhere is the nod to the connectivity. The intelligent computing is really the nod to the AI plus the processing power together in a really energy efficient package. Right. Because that's another thing, right? You can't perform really large tasks, AI tasks especially on a device that has a battery life of a day and a half unless you want a battery life of two seconds, right? You know, so that again, that's why this thing has to be hybrid. One big balancing act. Exactly. And so it's an ecosystem play. Everyone's involved. And it's exciting. We have our role. Everybody has their role. No one's right, no one's wrong, right? It's not a us versus them. It's not a Qualcomm versus Nvidia. It's not a Microsoft versus somebody else. It's really about everybody has a role to play. Who is involved in developing technology? And then where do all the puzzle pieces fit? So, even the content creators like you see New York Times and their lawsuit, OpenAI. Yeah. Well, and technology is just technology until you put it to use. Right. Right. When it becomes commercialized and it gets a little murky. Well, and you know, anything new, there's always trial and error. Yeah. Sometimes bad things happen. Happen with YouTube. It happened with Spotify, Napster. I mean, goes back. It goes back. And you know, there are bad actors and you know, and good actors in every category. In every category. And I, in my speakership I did earlier today, I talked about, look, if we could just, because I'm not a huge fan of regulatory oversight in general, because it's too slow. Yeah. And by the time they get something regulated, it's already moved beyond the regulation. Totally. Right. And so it's irrelevant. If I can't keep up, how's the government gonna keep up, right? Especially with AI, it's moving so fast. And so, it's really about standards and governance and practices and best practices that can be adopted and principles. And if we can learn the lessons from social media where there was none of that, right? It kind of went untethered so to speak for years. And you got a lot of good out of it. Absolutely. It opened the world up to so many people, connected so many people, but it also created mental health issues or enabled the environment, geopolitical issues, bullying, you know, all these types of things. So if we could learn some lessons from maybe a little earlier in the social media technology evolution, we could have anticipated some of those things and said, 'Hey, you know what? We're going to have some principles.' I think everyone involved, right? It's not just, yeah, like, yeah. It's not just Meta. It's, you know, because you can't just blame one party or can't point a finger because guess what? You maybe nobody's out. You know, everyone likes to think they're altruistic. But at the end of the day, if you are advertising on that platform that's then responsible for enabling bad behavior, you're culpable. And Meta has shareholders and those shareholders could be endowments of colleges. It's like so they need to deliver return. Right. Venture funds. Exactly. Right. Right. And so it's like it's this vast web, right? And so it's like everybody has to kind of join together and just say, 'Okay, how are we going to operate this thing, this beast?' And I know that's not easy. It's easy to say, not easy to do. But you know we've joined a bunch of companies in co-developing some basic principles for deploying AI and along with Microsoft and others and ethical principles about how we're going to create the technology. I think those types of things, you know, you look at platforms like Reddit, which are kind of community-managed, self-governed, so to speak, Wikipedia, like Wikipedia, and it works in that context. Obviously, I'm not saying it'll work everywhere, but if you take some concept of self-governance and then you add some other things in to insurance policy, so to speak. I think we can get there and I think we can prevent some of the badness, right, that came along with social media, right? And every technological innovation have badness. There's car accidents, right? Still today, right? Right. It's funny like technology is funny. There's a lot of fear, right? And I know a lot of people are fearful of AI and it's been used as a narrative, right? Was used in the writer strike and the actor strike. You know, people fear job loss and all these other things. A lot of that's just posturing. Because it's like I use the analogy of the elevator, right? The elevator first was invented, nobody would ride it because they were scared. They were scared, right? They didn't want to plummet to their death, right? But then Otis came along, who didn't invent the elevator first, by the way. They invented the latch that caught the elevator, right? Once that was invented, people are like, 'Oh, it's safe, right? This thing's going to catch it, right?' And so they start riding the elevator, right? So it's like that is a natural type of part of process that we go through as human beings. And with any technology, so I think we're going to go through those same types of things with AI as well as other things. Autonomous driving that's another thing right that you know whether we get to full autonomy and how and what context. It's going to be very interesting to watch. And you're going to have people that point to 'oh see that accident' but it's like okay well how many accidents does humans create? Exactly right. 80% of accidents are human error, right? In some way, shape or form, right? So, and so will autonomy fix that? Will it cause more? I don't know, you know, but it's going to be an interesting, it's a wild ride. It's so fun to be in tech, you know, I've been a tech marketer most of my career. So, it's always interesting.

Yeah, I mean I think the laptop is at an innovation inflection point for the first time in like I would say 15 years, right? And COVID gave the PC industry a nice bump. Yeah, Dell had a great year, drove an upgrade cycle primarily because the use case shifted. No longer was the laptop something that sat on the desk collecting dust until I needed a bigger keyboard and a bigger screen, right? It became a communications device. It's how I connected with my world because I couldn't connect with them physically. So, Zoom, Teams, the PC became a primary communications device. Less about surfing the web, right? Less about creating PowerPoints on a bigger screen. It became a primary communications device like the phone had been for so many years. Sure. But the context shifted and we needed to have meetings and we needed to look at multiple screens of people. So that gave the PC a renaissance, a short-term renaissance, drove an upgrade cycle. It was a good couple years. And then everyone upgraded their PC. 'Oh, I got a brand new PC. I don't need a new PC' because historically the upgrade cycles are like four to six years, right? And very long unlike the smartphone which has historically been 11 to 24 months. So, now, and that's primarily because there hasn't been a lot of innovation. 'Why do I need a new PC? This is fine,' right? Especially coming out of COVID, 'Oh, I have a new one. I bought it in 2021 or 2020 or whatever. It's fine.' But now with all these new experiences that you're going to be able to extract from the PC because of AI, and because of our work with Microsoft and the ecosystem, things that you've never imagined you could do with your PC and that you never able to do before with your PC are now going to become real. And that's, I think, really exciting. And we're going to see more of that later. I'm getting excited just hearing you talk about it. I'm not going to give away the surprise. We'll come back to you for that. You come back to me, you know, later on this year. But there are really amazing experiences when you can take the power of our Snapdragon platform and Windows 11 or just Windows in general and Copilot and our friends at HP and our friends at Lenovo and our friends at Dell and Samsung and Acer and Asus etc. that when we all come together, we're going to deliver some really cool stuff. And we're just in phase one. You know, you got to educate what is Copilot. Microsoft, you know, they announced the key, you know, which is great step one. Hey, there's something physical you going to push and magic's going to happen. And it's going to take some time. So we've got about 6 months and then I think you're going to see some real magic happen. And yes, I think that will create a desire for even though this may not be old yet in that context of the traditional PC upgrade cycle, this is going to offer me so much more that's worth the trade in. Yeah, it's like when you had to have the new smartphone every 11 months because there was so much new in the next one. Had Face ID, it had real things, much better camera. I couldn't get by with this. Are you kidding me? This is old, right? And so I have to have new. For the first time in a really long time, we think that psychological phenomenon is going to happen in the PC space, which we're really excited about.

I mean, that's part, if you look, you know, if my marketing mix was a wheel, right, or a pie chart, partner marketing is a big part of my mix just because of who we are. I am so blessed and honored to have so many great partners that I get to work with and through across product categories. I mean amazing brands from BMW to Cadillac to Louis Vuitton to Bose. Yeah, we can talk about that. To Samsung obviously to Microsoft. And these are big iconic culture brands. Yeah. And but we play a significant and important role in feeding their brand ethos as they move their products more and more into the space of delivering technology-driven experiences. And so by us working together with them and collaborating, for example in the case of Louis Vuitton as you said 'what do you mean you're working with Louis Vuitton?' We are not yet putting chips in bags. But you know could happen. But we power all of Louis Vuitton's smart devices. So, their watch, their smart speaker, their earbuds has our technology inside and they're a great partner. An iconic luxury brand, but they're a luxury brand. They're not a tech brand. So, what we bring them is Tech Credit, right? So, people can feel good about, 'Oh my gosh, these Louis Vuitton earbuds look stunning, but I still want good audio quality.' Yeah, they're going to work. 'Are they going to work?' Right. Or this Louis Vuitton smartwatch looks stunning and it's definitely Louis Vuitton from an on-brand perspective, but it's still got to work like a smartwatch. Yeah. So, is it going to deliver on my technology needs? 'Oh, it's powered by Snapdragon.' Of course, it's going to, right? Snapdragon stands for premium. Snapdragon stands for the best. Snapdragon delivers. Absolutely. So that tech cred is what we bring to the party for some of these brands that you would ask yourself 'what do you mean Louis Vuitton' or 'what do you mean a Peloton' for example. So that's really exciting and I get to work with these CMOs and these partners all the time and coming up with really fun interesting cool marketing types of experience. Fits their brand equity pillars also drives the messaging that you want. Absolutely. It's not about disintermediating their brand ethos. It's about amplifying it. And this whole idea that, 'Oh, if I talk about your brand in the context of my brand, that takes away from my brand.' That's BS. I'm sorry. And that's old thinking, by the way. And by the way, there's still a lot of people out there, especially in the automotive industry that think that way, right? But it's total crap, right? And I mean, I was so excited. I was in the New York subway maybe 6 months ago or so, maybe more, and I saw an ad where a bunch of brands came together with a single message, but they were individual brands, but they were all marketing kind of the same thing. And so this whole collaboration idea, and you see collabs happening all the time, right? Adidas and Monclair. Yeah. Right. So, you know, it's happening organically anyway. I'm just so lucky that I get the opportunity to work with some of these amazing brands and form these relationships with these other CMOs and share best practices. Which has been a good opportunity. So that's a significant portion of the mix. But you know there's traditional advertising, there's events, there's comms, PR and then two of the areas that I've been focused on for the past two years with my team are building community. Number one, community. What you say? Community of consumers for Snapdragon. Building affinity for Snapdragon through building community. And number two is brand partnerships. Not like customer brand partnerships like with Louis Vuitton or with Cadillac but brand partnerships with brands and companies, products, franchises that align with our brand values and that we together can tell a joint story as well as our individual stories and it's a win-win for them and it's a win-win for us. So perfect example is our relationship with Manchester United. And you ask 'why are you doing something with Manchester United?' Well in the context of building community for Snapdragon which is now 14 million strong. And Snapdragon is your, is that your new go-to consumer brand like it's called? Well it's been around for a long time but it is our B2C brand. I've heard a lot more about it as of late obviously with the AI. And you know the irony is that the markets where Snapdragon has the least amount of awareness is in the US, right, where we're headquartered and in Europe. But you know, you walk down the street in Shanghai, you ask a consumer, 'Do you know what Snapdragon is?' 90% of them are going to say yes. Right? So, I've got typical high levels of consumer brand awareness in Asia, in Latin America, etc., etc. And it's really been sort of the western markets that we haven't invested in and haven't focused on. But that's going to change with the advent of PC. We didn't really feel like we needed to do it for smartphone because some of those markets are duopolies. You know, there's one company, right, and then there's the other company and then that's it, right? And we're partnered with the other company and we do lots of co-marketing with them. And so we're good. But now we do need to build affinity for Snapdragon because the PC space is a different space. We're starting to see an automotive, an openness and a willingness to give us attribution for what we're bringing to the table because again automotive companies historically are not tech companies and sometimes they try to mask as them and they create poor software experiences for the user. Some of them just wave the flag and they do CarPlay and consumers love it and that's it. And then they're, yeah. Which is great for consumers and great for the company that makes CarPlay, right? But not so great for the car company, right? Because then they lose that relationship connection, right? Our platforms enable them to actually build something meaningful, which is why they'd rather do that. So, and then give us attribution for that, which is fantastic. So, building community and brand partnerships are really important. We have 14 million Snapdragon Insiders around the world which every day I'm astounded and amazed by the fact that 14 million people are interested in a product that they can't actually buy. Right. But they are tech influencer, tech enthusiasts. They love talking about technology. They believe in the promise of what it unlocks. Right. And they want to peel the onion back. Yeah. Right. They just don't buy into it's just the plastics and the display and the wrapper. It's what's inside that's making this happen. And it's kind of back to the Intel Inside playbook a little bit. But in a brand new context, right? I mean, Intel did that brilliantly. And I was part of that ride for the five and a half years I was at Intel of building Intel Inside as a meaningful full-funnel, right, sort of thing where consumers were like walking into a store and saying, 'I really don't care if it's HP or Dell or Think, but it better be Intel.' Yeah. They did a fantastic job at doing that. Yeah. And then over time, obviously, that device category lost relevance. Yeah. With consumers. So thereby the Intel brand was so attached to that product category that the Intel brand started losing relevance. And then now anyone under the age of 35 may not even know what Intel is or care as the primary digital experience interaction of humans moved from that big clunky heavy device to something that fits in your pocket. Yep. And that's where our DNA sits and that's where we've been for several years. And so we have this opportunity, right, to kind of move into this next generation. And we're not a one-trick pony. It's just not about one product category. It's phones, it's tablets, it's wearables, it's hearables, it's cars, it's PCs, it's etc. So my purview is wide. And I get to kind of play in this bigger playground, which is fantastic. And so with all these goals to build Snapdragon as a culture brand, a consumer culture brand, it's a big ask for my CEO by the way. I have an amazing CEO who believes in marketing for an engineering-driven company. You can tell. That is where we've struggled for years. My team and I have struggled for years just to make marketing important. Cristiano is a huge believer in it and so as a CMO it's so helpful. And I also have a great relationship with our CFO who also understands. And I have a great relationship with our CIO because he's my great partner in crime in reimagining our digital experience. So we have a great executive team and it's fun. It makes it fun but it also helps me do my job, right? I wouldn't be able to do my job without that enablement, without that permission that he provides me. And one of his tasks that he's given me recently is 'I want Snapdragon to be a culture brand.' Like that's a big ask. It is. So we're working on that. Especially for a brand that people can't touch and feel, right? I'm like dude really? I'm like I'm good but am I that good? No. So, it's interesting. We're going to take that on. We're going to see how far we can get. And it's going to help. It's a team sport, so it's going to take help from everybody. But we're taking on that ask. So, brand partnerships are going to be really important to that. Specifically attaching ourselves to brands like Manchester United, largest sports brand in the world, 1.1 billion fans. We want to build more community. We want to attach to their community. We want to cross-pollinate. There's lots of overlap. It's an amazing partnership. They're an amazing brand. They're premium. They're the best of the best. Snapdragon premium, the best of the best. Brand values are aligned. And they provide me scale and reach that I would have to spend four times as much on traditional advertising methods to get that exposure for my brand than what I'm spending to become the new front of shirt partner for Manchester United starting in July of 2024, which I'm super excited about. Only the seventh front of shirt partner in. Big I'm sure. Big investment and for us especially big step but when I showed the ROI and when I showed the efficiency of it and the popularity of the sport globally, football is just exploding globally but just the ROI and the efficiency versus 'hey you want to triple my marketing budget every year for the next five years' right? Or do you want to do this? It was like that makes sense. So I'm super excited about that. Our F1 partnership especially as it relates to our automotive business is really important with Mercedes. The Mercedes team is amazing. Toto is amazing. All of the people at Mercedes, AMG, Petronas are amazing. And innovation for automotive often comes from F1, right? So being in the heart of that innovation, right, with our brand makes sense. So our F1 partnership, our Manchester United partnerships, all those types of things are really important to building out the Snapdragon brand ethos. So they're a big part of my mix as well.

I think anybody, right? I mean, if you love what you do and if you believe in whatever you're selling or whatever you're making or creating, you have to believe in it or else why do it, right? Well, some people just do it because it's a job and for the money. Sure. Right. Right. Peace. You know, I'm not built that way, right? I'd probably be heavily medicated by now. But I definitely love the fact that I've worked in this technology space for so long and what we do actually does change the world. Yeah. Right. We put the internet, right? We've done all these amazing shifts societally speaking. Not just with consumers or businesses or enterprises but just society, we've driven this change. And yes, there's been good and bad obviously as a byproduct as we talked about with social media. And you could blame us for the social media backlash because we enabled it, right, by putting it on your phone and allowing you to connect, right? So, I get it. But it's been really really gratifying and rewarding. I can't imagine like to your earlier point about hey, some people just go into work and clock it in and go home and it's fine. And you know, again, no judgments, but I can't imagine working that way because you spend a lot of your time at work. Yeah. So, you might as well love what you do.

What would I say? I would say, when a window of opportunity opens, jump first, ask questions later. I think I've always been a believer that you have to take your destiny into your own hands, no one is going to hand it to you on a silver platter, right? And when you lose control of your destiny, that's when you lose control of your path. And you can't own your path anymore. And it happens to a lot of people because the corporate entity, the corporate life tends to suck you in and then it has a gravitational pull and end up wherever and then all of a sudden you feel out of control but you don't know what to do about it. So if you can just keep your mind set in a place where it's like okay this doesn't seem right. I know I have a centered perspective on where I want to go and who I want to be and what I want to do over the next, you know, two, five, 10, whatever years. I'm going to make decisions based on that and I'm gonna block out the noise and I'm going to reject, you know, the inertia or the gravitational pull when it's pulling me in a direction where I don't believe I should go. I'm always celebrating people who come into our organization and who leave our organization. Especially if they're going on to something better for them. Right because I think that's amazing for them. And then one of my mentors, Susan Swenson, taught me once, in a performance review because I'm very results-oriented. And as my team will tell you, and early on in my career that manifested itself a little bit in a bull in a china shop type of behavior. Where it's like, I don't care what's in my way, the results over there. I'm going to clear the decks and get the result. Dead bodies be damned. Right? And I had a review with my boss at the time, Susan, and she said, 'Your results were fantastic, amazing. But I'm rating you at a whatever.' I'm like, 'Well, wait a minute. I overachieved.' And she said, 'Absolutely, but how you went about it has some things to be desired.' And she just took me through it. She said, 'You can't leave dead bodies in your path. You can't have broken glass. You can't like, and those are all metaphors for, you know, you can't do it in a way that neglects the human element, neglects empathy, right? Neglects collaboration, relationships to get to that goal. I mean, yes, some people can and it may get the result, but then the aftermath.' Just like athletes with poor sportsmanship, same thing. Exactly. And it can get you so far, right? For so long. So the how you do things is as important as the what you do. Yeah. And that's a piece of advice that was given to me and it actually helped me correct my behavior over time. And I would, if I could save the young Don from the bull in the china shop syndrome, or anybody else out there, I would gladly go back and do that.

Love to be back. Absolutely.