Tech CEOs Discuss Partnership, AI Revolution

Bloomberg Audio Studios, podcasts, radio news. I would call it all arms of the AI supply chain or market. Gavid here and the three CEOs just on stage together moments ago. Our host is Michael Dell, CEO and chairman of Dell and a company celebrating forty years as well at this event, and Video CEO Jensen Wang, it's good to see you. And Bill McDermott, chairman and CEO of Service.

Now.

I think it's probably sensible to ask, is this the first time that the three of you have actually been in the same room at the same time. And Michael, to you as our host, why the three of you in the same room at the same time.

Well, you know, the technologies world, we love to bring our customers and partners together and talk about what's new and what's exciting, and you know, this AI opportunity is really tremendous and we can never do anything by ourselves.

But this is a great example.

Of how you have an ecosystem of companies coming together along with all these incredible innovations in GPUs and compute storage and networking and all the AI models and software companies that are utilizing all this power and it's causing a new industrial revolution.

There are five things that I would like to talk about. The first being the relationship between the three of you and your companies, how you work together. The second being AI infrastructure, how durable. What's happening is AIPC. You know, you've been talking about AIPC on social media for some time, and officially of course as well US leadership. You know, I reflect that I have three American CEOs that around me,

Well, this is a.

Really important time where we've re engineered and reinvented every layer of computing, from the chip to the operating system to the system servers to the way that these data centers are put together.

There's only one company in the world that.

Can have the ability to build the computing system, the storage system, the networking system, all of the software that goes along with it, and the path to the world's enterprise.

Computer the data center.

These AI factories can help every customer have a you know.

Just reimportate Tensen. Yeah, on prem is back just really quick? Yes or no?

On prem never left? Okay, but on prem never left. But on prem is on prem is you know, on prem is cool again?

On prem is cool again. Save that thought.

Bill.

You've been a software CEO for quite a long time.

You know, I knew you.

At SAP now at Service Now have you ever had to have such a focus on the minut share of a semiconductor company, a server company. Have you ever had to worry as much about the OEM and the chip maker that underpin what you're trying to do well.

I think Michael Dell and Jensen Wong are at the epicenter of the AI revolution. This is enabling Service now to be what I dreamt it would be, the defining enterprise software company the twenty first century. We run our whole cloud on Dell Technologies, and that's a big deal because we're talking about four billion workflows and four trillion digital transactions on that platform, running a million business processes

They're betting the we were doing business with them when frankly, all of this wasn't sexy totally.

Now It is totally Actually, that's one hundred percent true, and we'll always be doing business with them because trust is the ultimate human currency, and we trust them with our lives.

This is all very nice, and I'm very grateful and honored almost to be here with the three of you. That there's a contradiction though that markets are often built on choice. Choice, Foster's competition. Competition is the mother of innovation. So the saying goes I had the Core Weave CEO on my show on Friday, and he was briefly honest about it. They look at other silicon, they benchmark, they

Yeah, And we do work a lot of Coral.

We've so you know, we know about their use case.

And look, I think the reason that Bill's partner call with Nvidia and we and really you know, in videos in a leadership position is because they've out engineered other folks and they've built a set of capabilities, including software over many decades that has prepared for this opportunity.

But you know you talked about on prem The other.

Aspect of this is the edge, right, the physical world, the PC, the factory floor, you know, all the retail stores. AI is going to be everywhere, and you know, having that sort of entire ecosystem of capabilities, that's ultimately what's going to drive success.

But you know, the video is in a great position.

Jensen has done a fabulous job bringing the world the most innovative accelerated computing solutions.

Could you define for US AI factory what is an AI factory?

Sure?

So an AI factor is really a supply chain that creates intelligence. So if you think about a traditional factory, right, you've got all these ingredients that we know a lot.

About supply chains. It's kind of what we do.

But think about it as a supply chain to create intelligence inside your company.

And to do that, it all starts with data.

Right.

If you have no data, you have no AI.

Right.

If you have bad data, you have bad AI. So you've got to organize your data.

It's something we know a lot about because data equals storage, and we store more data than anybody in the world. So you start with the data and then you know you get into the ecosystem of all the software and the models that you're hearing about, the small and large models, the retrieval augmented generation. Of course, it's not just GPUs, it's also the networking and storage and the memory that come together.

I don't know if and knows this, but you talk a lot about H one hundred is not just a chip you hold in your hand. In reality, it's DGX, right, HGX. Your staff are probably very nervous over your shoulder, but they've let me play with let's say DGX, do a deadlift with it to illustrate the points.

Eighty pounds, thirty eighty pounds.

Thank you. But that's the scale of what we're talking about. Still, the AI market that I see is you selling H one hundred in DJX form to the hyperscalers. And I'm not yet seeing the AI factory that's going to the SME or the enterprise customer. When does that really happen?

And why today's announcement is such a big deal an lots here.

I'm here to announce.

This Dell AI factory with Nvidia going to market starting today.

In order to do this, just think about what an AI.

Factory is it has CPUs and GPUs, it has networking switches, incredible amounts of software in systems connected to storage, and the miles of the miles of cables alone necessary to

Buildings at buyers.

It's actually already happening. And you know, companies like Service now had the.

Engineering resources to sort of build their.

Own with our help and capability.

But now we're already doing this with hundreds of enterprise companies. And there's also some services that go into this because it's a new thing, it's a new architecture and you saw us announce new capabilities today around storage and networking.

Again, it's this.

Whole solution and we've created the easy buttons so the enterprise just can kind of quickly implement and deploy these tools.

You can think about it through the lens of your customers that are themselves enterprise companies, probably of smaller size. Do you think that they are ready for this AI factory investment that they're going to have to make.

Is I know they are?

You know, last week, for example, I had the pleasure of being with Microsoft and Satia and what they're doing on Copilot as an example, is something that every CEO is well aware of what.

They're being and small, big and small.

And we build our own domain specific models on the service now platform. Why does that matter because we're really focused on experiences. There's an eleven trillion dollar market in terms of GDP impact over the next three years according to IDC. That is how we're going to help the world economy improve. Companies like Dell Technologies and Nvidia.

And service Now.

Yes, but I also acknowledge your point. We have to be open and for example, we have great partnership with Microsoft. They're not in the room right now, but they're a great partner. You talk about them when they're not in a room, because that's very important to our customers. To have the Copilot and to have the Now assist we're

This is a tsunami.

This is a tsunami of change, and only the smart ones are going to recognize. I have to plant the flag now. Whether the story is complete or not, it's not the issue. The train has moved out. It's on the fly.

So you made this analogy. I think you're channelling Jensen. But the idea is that when you stand at the platform, the train goes by fast. If you're on the train, it doesn't feel fast. I want to extrapolate out there's something that Michael Dell is very good at, if you don't mind me saying, Michael, which is selling to businesses the public sector, probably in places Jensen that you don't

Question about it, and do you need him to. Absolutely.

We've been partnering with Michael for coming up on three decades to reach the world's markets. In the old days, one of the first things that we worked on was PCs for gamers, and then PCs for industrial designers and car designers and so on.

And so forth. We're able to reach.

The world's enterprise through our partnership with Michael and partnership with Dell. And the thing that's really really extraordinary this time is that it's not about just delivering a box. It's about delivering an entire infrastructure. And that entire infrastructure is insanely complex. The last thirty years, both of our companies have changed a lot, and this this this he said it early that everything that we've done is been

Dell and they'll come in.

Not only do they have all the solutions and all the technologies, but they'll also have the professional services to help you stand it up and put it to work. And so we're working with Michael and Dell across everything from from CPUs, the GPUs, then they're working the software across the entire stack. Now, one of the things that that it's so fun listening to Bill, I just sit

Us do that.

The next level down is the AIPC. It is here according to today's announcements. Yes, I don't really even know where to start. You know, is the AIPC for the knowledge worker or is it for every human around the world. In the first instance.

You know, every time you have a new way of technology, you got kind of the early adopters and at some point, you know, you inflect where there are mainstream use cases And what's really going on right now inside companies is you had this incredible surge in buying PCs about four years ago with.

The pandemic that was COVID relates right, yes, and there was.

An enormous you know, we have the biggest installed base ever and so now these organizations are getting ready to replace those older machines and they're thinking, Wow, this AI thing, maybe there's something to it.

Right that go duaranting there. If you take Bill's position, for example, he's made all the infrastructure investment and probably software and talent investment, and now he's thinking, Okay, I've got to deck out my twenty four thousand staff around the world with AIPCS.

Is that fat one hundred percent? And we can't wait to do it. We're ready, We're ready to go.

The other thing you got to remember, too, is the enterprise is a total mess.

You said that on something Explain what's happening?

You're an industry was a week about exactly. But the industry is very good at what it does. So for fifty years a half a century, everybody sold into an individual buying center or a silo finance, HR sales development. So now what you have is an unintegrated enterprise. So if you're a CEO right now, you're looking down to use AI. You're like, well, wait a minute. My people are swivel chairing between seventeen applications a day, costing them almost one third of productivity.

Why why do you need change?

Because you can, And a lot of them don't know that it is one single device.

I'm talking about a laptop or a desktop. No, but let me explain that.

Let me explain it's not about a laptop or a desktop.

It's about integration.

Eighty five percent of the projects today in digital transformation failed to deliver an ROI for one single reason, integration. So we are that, as aid Jensen would say, the AI operating system for the enterprise that integrates the past but invents the future. So Nvidia, Dell Technologies the other future. We all have to still integrate the past. Jensen even

You are doing it. But I grew up with Dell computers, right, and I'm talking about me playing Age of Empires cd ROM that Dell computer. Right, convince me and millions of people around the world that they have a place for the AIPC in their lives. You had five models, right, and that's quite a lot of choice for first gen of a nascent technology.

All our new PCs will be aipc's right.

And the reason is that anything that you're doing that hasn't edit prompt is going to be sped up because every software developer in the world is figuring out how to use all this new power in the GPUs and the NPUs in these new aipcs.

Serial processing units for the.

Exactly so that experience will be better.

So when your PC is now four years old, it's time for you to get a new one, right, You're going to want the one that speeds up those new capabilities.

And inside your company, they're gonna want to make sure.

You have that that you know, they don't want to buy a machine that's gonna last for several years that doesn't have.

That capability Jensen, whereas Nvidia's placed in the AIPC. I know you is gaming. That's again I grew up with the gaming side of Nvidia. Do you have a place in the AIPC market.

Come back next year.

There's exactly.

There are a bunch of bunch of video GPUs and del PCs, del workstations. All of our GPUs have the same tensor cores that are running in h one hundreds in the cloud, and so every one of our GPUs use AI to do its work.

AI of course is going to transform gaming.

All the NPCs, the non player characters, they're going to be checked by.

That's been time. How it will be cut For example.

Creating world is going to be easier.

Instead of instruction driven computing, it's now intention driven computing. So it's easier to write programs. Python programs will be even easier to write. Video conferencing will be a lot better because of it.

But what you did with Blackwell and other products, is you innovated by saying, okay, let's combine GPU is CPU. Is that the next itseration for you in AI PC? You go, okay, here's the Nvidia CPU that goes with it.

We want to support every CPU the world makes. And there are places that one x eighty six, we support x eighty six. There are places that prefer ARM, We support ARM. We just went to i C and the top most energy efficient supercomputers in the world are now powered by Grace Hoppers, And so wherever it makes sense, we'll support the right CPUs, but we'll support every CPU.

Let's talk about the US leadership side of this. With three American CEOs, is that news frankly in and of itself that across all parts of the supply chain, they are American companies that are leading. Michael Dell, I'm not.

Really sure that it's news because it's been uh, you know, the US has been has been leading UH in innovation for for quite some time.

But it's certainly a great thing.

For for UH, for the United States and and the US economy to have, you know, great companies like Nvidia, Service Now and Microsoft you know here in you know, driving innovations, driving productivity and efficiency, and you know, the world requires these new technologies to enable everything.

You talked on stage about your your experience and the supply chain, your global experience of doing business. But do you see the same investment in Europe, Latin America, Southeast Asia, as you do in the United States, and both the corporate and public sector side.

It's coming.

You know, Jens and I spent a lot of time talking about this and how it's expanding out. And you know we're seeing You saw an example from South Korea on stage, yes, right, with Samsung Sung. You see this in the Middle East, you see it in sovereign AIS that are being built up. And you know, for our country to encapsulate its own culture, language, and beliefs, that's happening in every country in the world.

Which esid you and I've discussed sovereign AI in the past. You know some recent US being Japan as an example. But I go back to my same question about the durability of this market moving beyond the hyperscalas to see big commitments at the nation state level. Again, is today's news and indication that that happens because of AI factories or are they running two separate paths.

No country can afford to outsource its intelligence on first principles, every country has its native natural resource called its language, it's culture, it's intelligence.

And now people realize.

That because their country's data is part of their natural resource, not just the copper, minds and the gold, or know, the lithium or whatever it is. It's also part the data is also part of their natural resource. And they have to make sure that they harness that natural resource and translated transferred into artificial intelligence. And where to do that, they need AI factories in every single country. It's also the case that many countries have excess.

Power, you mean energy energy.

Excess energy, and so that excess energy how to be transferred translated into intelligence. And this new industry, this industry of producing intelligence is one.

Of the greatest opportunities I've ever seen.

One of the things that you were asking about earlier about how quickly AI will be adopted. It is far easier to interact with a computer that understands your intention what you want because it's intelligent, than it is to program the computer one line of instruction at a time. The world has very few experts and C plus plus and C, but the world has many people who knows how to converse and ask somebody for help. And now you could interact with a computer in that very natural human way.

Tesla, really yeah, and so we've really lowered the bar. Let me ask computer.

We're running out of time, gentlemen, but Jensen. Overnight we had a new Taiwanese president sworn in. You've told me your position on China, but you've both talked on stage about how global this is. You're still quite dependent on TSMC to manufacture your chips. Do you still focus on what's happening in Taiwan? What's happening in China? You've been very clear about your product cide with China, but still geopolitically, US leadership impacts a key market.

Well, Taiwan is at the epicenter of the world's technology supply. Why chain Without Taiwan, it would be very difficult for my and I to do our jobs. It would be very difficult for us to serve Bill and his company, And so the technology industry depends very heavily on Taiwan, who continues to for some time.

Let's end on energy and power. People are conscious about it. You know, Bill, we talked about your infrastructure investment, We talked about Babe, AIPC upgrade cycle. But your costs did it keep you up at night? That's a classic question, isn't it.

Well, I think it's all about the returns that you get on the investment. If we weren't expanding our margin profile and growing our revenues at a record clip, it probably keep me up. But we are because the AI revolution is the biggest market we've ever sold into.

I do want to make a couple points.

One is it's very important what you started out the interview with the openness. So with LM's we have a policy where any customer doing their own LLLM or working with another large language model, they can bring their own to service now and fully integrated into the platform. That on the record, because this openness is a key part of our overall strategy. What does that matter?

Because of the globalization effect.

If you look at Neom, we're doing a smart city in the Kingdom of Saudi Arabia. If you look at our great brand ambassador Idris Elba, We're now going to build a smart city together in Sierra Leone, and all over the globe, public sector, private sector, all these industries are changing all at once. I gave the Schwartz Group example, because they're running a great company in Germany, number one retailer in Europe. Everything is being reinvented in that company by AI.

So please know it. This is not like a little thing.

This is the biggest thing any one of the three of us have ever seen in our lifetime.

That's pretty intense place to end it. Michael Dell Chairman, and Coeodell, thank you for hosting us here in Vegas. He does want of Nvidia film McDermott of service now. Thank you.