Analysis: 5 Takeaways On The State Of AI PCs And Why Big Channel Vendors Are Excited

CRN explains the state of AI PCs and why some of the world's biggest tech companies believe the category is the next big thing.

More than 50 AI-enabled laptops are available in the market now, many more are coming in the next several months, and yet the industry’s loudest boosters are still on the hunt for the many “killer apps” that could make these devices indispensable.

Welcome to the dawn of the age of the AI PC, which some of the biggest IT vendors in the channel believe will reinvigorate the industry and set off a new wave of refresh opportunities for partners.

It was only this year that these companies started to talk about the idea of the AI PC, which, at this point, mainly consists of laptops with processors that contain a neural processing unit, or NPU for short, in addition to a CPU and GPU to handle a variety of AI workloads.

While chip companies had been planning to integrate NPUs into processors for years, it was the hype around generative AI, kicked off by the launch of ChatGPT last year, that expanded the industry’s imagination and prompted vendors to perceive an AI future not just powered by the cloud.

While the success of the AI PC ultimately hinges on scores of killer apps to attract and win over users, chip companies like Intel and AMD are powering AI-enabled personal computers well before many compelling use cases have become fully established. But to these companies, they are doing so for good reasons.

As part of CRN’s AI PC Week, here are five big takeaways on the current state of AI PCs and why major tech vendors believe its the next big thing, even if the category is still in the early innings.

Major Channel Vendors Believe In The AI PC’s Potential

Some of the biggest IT vendors in the channel believe AI PCs will reinvigorate the computer industry and lead to new opportunities for solution providers.

These vendors include chip companies Intel, AMD and Qualcomm as well as OEMs like Dell Technologies, HP Inc., Lenovo and Acer. While Microsoft’s Copilot AI assistant largely relies on cloud computing power, the tech giant believes the PC will play a big role in powering future AI applications.

“We see the AI PC as a sea change moment in tech innovation,” Intel CEO Pat Gelsinger said in his keynote at the company’s Intel Innovation event in September.

AMD CEO Lisa Su echoed Gelsinger’s thoughts this week.

“It’s something that is really going to change the way we think about productivity at a personal level,” she said at the company’s Advancing AI event Wednesday.

Qualcomm executives made clear at the company’s Snapdragon Summit 2023 event in October that they also see AI PCs as a game-changer for the industry.

“The next step change for PCs is how the silicon uses that performance and efficiency to bring entirely new, more personalized AI experiences right on the device,” said Áine Shivnan, vice president of engineering for the chip designer, at the event.

It’s a feeling shared by HP CEO Enrique Lores as well.

“What is really exciting for us is how AI is going to transform the PC category. It’s going to create a new set of PCs that are going to deliver totally new experiences for our customers,” he said at the company’s HP Imagine 2023 event in October.

Leaders at other top OEMs are on the same page.

“Very soon on your AI PC, you will be able to build a local knowledge base, run a personal foundation model, perform [augmented reality] computing and use natural interactions with it,” said Lenovo Chairman and CEO Yuanqing Yang at the company’s Tech World 2023 event in October.

AI PCs Are Available Now, And More Are Coming Next Year

While Intel plans to enable new AI PCs in the next several months with the Dec. 14 launch of the Core Ultra processors, AMD is already powering more than 50 AI-enabled laptop designs with the Ryzen 7040 processors that came out earlier this year.

These AMD-powered AI PCs consist of laptops from Lenovo, HP, Asus and Acer, and they range from gaming systems to computers aimed at commercial users and content creators.

Intel’s upcoming Core Ultra processors are expected to receive support from major OEMs as well, including HP, which recently said it will have the “widest range of PCs” using these chips.

Meanwhile, Qualcomm plans to launch a new processor called the Snapdragon X Elite, which it said will enable AI PCs from leading OEMs, including HP and Lenovo, starting by the middle of 2024.

What these processors have in common is that they have an NPU in addition to a CPU and GPU. While the CPU and GPU are expected to handle certain kinds of AI applications, the NPU is designed to offload sustained AI workloads from the CPU and GPU using lower power to improve the laptop’s battery life.

“You have CPU cores, which, with the right instruction set extensions, have the ability to very efficiently do low-latency, high-throughput inference operations. You have GPU cores, which I think we all know for GPU compute, GPUs are great at highly parallel compute,” said David McAfee, corporate vice president and general manager of AMD’s client channel business, in an interview with CRN.

“But as general-purpose compute engines, the overhead that both of those have is that they are very big, very heavyweight engines that require a lot of power to spin them up and you don’t necessarily achieve the efficiency,” he added, which is where the NPU will come in.

Vendors Believe AI PCs Will Address Security, Personalization, Cloud Costs

Vendors think AI PCs will become a big deal because, after a year of massive hype and spending around generative AI applications, they see a need and desire for software that runs locally on a PC rather than the cloud to improve latency, privacy, security and personalization while also reducing costs.

“The ability to run generative AI applications locally will enable more personalized experiences, improve latency, provide better security and privacy protections, and reduce costs. And all of this is good news for the customers we serve because it is going to make them more productive than ever before,” HP’s Lores said at Qualcomm’s Snapdragon Summit 2023 event in October.

Privacy has been an oft-cited need for businesses that don’t feel comfortable putting proprietary information in the cloud to feed into AI applications.

Meanwhile, the cloud costs of inference, the process in which an AI model makes a prediction or generates a response, can be exorbitant for large language models and other massive models due to the amount of computing power required.

“For large organizations, cloud computing costs can scale quickly. With modern AI PCs, the more processing you bring onto the Snapdragon devices, the more you save on cloud computing costs,” said Alex Katouzian, senior vice president and general manager of Qualcomm’s mobile, compute and extended reality, at the company’s October event.

And with the ability to run AI models on personal data, AI PCs could unleash a new wave of personalization for users across a variety of applications.

“I feel like AI is going to put the ‘personal’ back in the personal computer, to custom-tailor the experience in ways that we have never experienced before,” said John Kalvin, vice president and general manager of global partners and support at Intel, in an interview with CRN.

AI Chip And PC Vendors Don’t Expect Fast Growth At First

While ChatGPT and other cloud-based generative AI applications have driven explosive growth for data center AI chips and systems, vendors in the PC ecosystem think adoption of AI PCs will happen at a slower but sustained rate in the beginning and then ramp up in the coming years.

Intel Chief Commercial Officer Christoph Schell said he believes AI PCs will present a “significant” refresh opportunity in the commercial PC space but cautioned that the first wave of AI-enabled computers powered by the company’s processors won’t lead to “hockey-stick” growth at first.

“I think [the refresh opportunity is] significant. I also know this is a question where a lot of people hope for a hockey stick. I don’t think it will be a hockey stick. I think it will take a little bit of time for people to actually understand the use cases,” Schell said in an interview with CRN.

HP also believes it will take some time for AI PCs to gain wider adoption.

“We don’t think the market will immediately shift to AI PCs. We think there will be some penetration in [2024], stronger in [2025], and even stronger in [2026], so it will take some time,” Lores said in a call with journalists and analysts last month.

However, Schell said, commercial momentum could start to pick up as soon as the second half of 2024.

“If we meet a year from now, the amount of [request-for-quotes] that we would have seen, particularly the second half of next calendar year, in the client commercial space that will have [requested] AI features will be a significant number. That’s my bet,” he said.

Some ‘Killer Apps’ Already Exist But Many More Could Be On The Way

While dozens of AI PC designs are already available and many more are on the way, vendors are still on the hunt for “killer apps” that will drive adoption of devices in the new category.

“We’ve always gone through this question of what’s the killer app? And my simple answer to that is you. You’re going to be the ones creating these next-generation applications and use cases,” Intel’s Gelsinger told ISVs at the company’s Intel Innovation 2023 event in September.

At Intel Innovation, the company demonstrated a couple of examples for AI PCs, including one that is already available on Mac computers and coming to Windows PCs soon.

Called Rewind, the app turns a computer into what is essentially a personal ChatGPT by recording a user’s actions on screen and through audio and allowing a user to perform a variety of chatbot functions using that data, from drafting an email to summarizing an event’s keynote.

“Rewind is a personalized AI powered by everything you’ve seen, said or heard,” said Dan Siroker, co-founder and CEO of Rewind, at Intel’s event. “The way it works is it captures your screen and your audio, it compresses it, encrypts it, transcribes it, and stores it all locally on your PC. And then best of all, you can ask any question of anything you’ve seen, said or heard.”

Other early AI PC use cases include dozens of experiences available through content creation applications such as Adobe Photoshop and Blackmagic Design’s DaVinci Resolve. AMD said its Ryzen 7040 processors power more than 100 AI-enabled experiences from Adobe and other ISVs so far.

But vendors believe there are many more AI-enabled experiences on the way in the coming months or years —particularly those that take advantage of the PC processor’s NPU—and they’re hoping a “groundswell” of development will make AI PCs more attractive in the future.

“I’d say, from large ISVs, it’s a rolling thunder, where every month you’ll have new capabilities brought online,” David McAfee, corporate vice president and general manager of AMD’s client channel business, in an interview with CRN.

To encourage ISVs to develop killer apps for AI PCs, Intel has launched what it’s calling the “industry’s first” AI PC Acceleration Program. With more than 100 ISVs already involved, the program provides developers with engineering, design and marketing resources to take advantage of Intel’s forthcoming Core Ultra processors for enabling new AI experiences on PCs.

AMD, in the meantime, has launched a contest that will reward a $10,000 prize to a developer who creates a compelling application for Ryzen-powered AI PCs.

These programs are on top of broader efforts by chip companies to support ISVs through software development tools like Intel’s OpenVINO toolkit and AMD’s Ryzen AI software toolchain.

OEMs like Lenovo and HP, on the other hand, plan to introduce their own AI-enabled experiences for PCs to differentiate themselves from competitors.

Meanwhile, Microsoft plans to take advantage of the PC’s local processor in combination with the cloud to power upcoming versions of its Copilot AI assistant. And this is in addition to the company’s recent moves to expand tools for ISVs creating applications on Windows.

“We’re putting together new systems architectures that really power those experiences going forward, and they really pull together GPU, NPU and certainly the cloud as well,” said Pavan Davuluri, corporate vice president of Windows and devices at Microsoft, at AMD’s Advancing AI event Wednesday.