Why Microsoft bet on Surface | The Vergecast

Intro (00:00:00)

• David Pierce, the host, talks about his FIFA addiction and the upcoming end of the FIFA season.
• He mentions spending money on a guide to improve his FIFA gameplay.
• The main topics of the show are Microsoft's recent developments, smart home news, and search engines.

Interview: Microsoft’s Pavan Davuluri (00:02:37)

• Microsoft has been pushing AI across its products and recently introduced co-pilot plus PCs.
• Pavan Davuluri, head of Windows and devices at Microsoft, is interviewed to discuss the company's recent developments.
• Davuluri has been with Microsoft for over two decades and has witnessed significant changes in the Windows and Surface divisions.
• The conversation begins by reflecting on the launch of the first Microsoft Surface and Surface RT in 2012.
• At that time, PCs were thought to be declining, and phones were seen as the future.
• The Surface RT, despite its flaws, marked the beginning of Microsoft's journey in the Surface line.

The ARM bet and Surface RT (00:04:10)

• Microsoft's Surface RT aimed to modernize Windows and introduce a new user experience combining PC, tablet, and mobile elements.
• Microsoft's ARM journey, including lessons from devices like Surface Pro X and Surface Pro 95G, has increased their confidence in delivering great ARM-based products.
• Microsoft's diverse Windows ecosystem brings advantages and complexities, leading to a decision to address the entire silicon platform for a solid foundation.
• Microsoft prioritized emulator performance, setting clear benchmarks for meaningful improvements within time-to-market constraints.
• Microsoft engages with consumers and commercial customers to gather feedback, data, and telemetry to address core issues, ensuring native support for essential components.
• The success of these efforts is measured by customer feedback and product evaluations, determining whether Microsoft has met customer expectations.

AI Integration in PCs (00:09:59)

• Microsoft shifted its focus to Surface devices due to the potential of AI and the need to emphasize the significance of PCs in the smartphone era.
• The pandemic highlighted the crucial role of PCs and Windows, prompting Microsoft to explore the platform's potential and the role of Surface devices.
• Microsoft sees AI as an opportunity to reimagine PCs and integrate AI across its products, investing in a modern hardware platform and SoC ecosystem for Windows devices.
• The company acknowledges its loss in the mobile market but now emphasizes durable value propositions with Surface devices, focusing on PCs and AI integration rather than solely relying on AI devices like the Surface Duo.
• AI will be delivered as a set of services and experiences across various devices, platforms, and form factors, with potential in large-screen form factors like Pro devices and laptops.
• Microsoft recognizes the advantages of AI in PCs due to Windows' multi-platform nature, enabling AI models to reason across multiple applications and workflows.
• The company aims to integrate AI into the Windows UI subtly and efficiently, enhancing the capabilities of Windows devices and its app catalog.
• Microsoft is exploring ways to use AI to assist users in their workflows, providing relevant information and suggestions to improve productivity.
• The company focuses on three key areas for the future of Surface devices: UI affordances and constructs, app experiences, and hybrid AI.
• Microsoft believes semantic indexing and structural notions will create new shell surfaces and experiences, allowing for continuous refinement and iteration.
• The collaboration of large cloud-based models with edge models is being explored to enhance reasoning capabilities and open up new experiences at the OS and app layers.
• Microsoft utilizes the Windows Insider program, customer feedback, and experimentation with commercial customers to learn and iterate on its products.
• The company draws upon its leadership in responsible AI in the cloud to ensure a consistent and responsible approach for its customers in Windows.
• Microsoft balances its long history with the need for change, preserving familiar workflows while introducing innovative features.

Future of Surface and Windows (00:25:30)

• Microsoft's strategy with Surface is to drive innovation in the Windows ecosystem responsibly for end customers and as a business.
• Surface has been instrumental in pushing the boundaries of what is possible in technology, product design, and customer experience.
• The company will continue to experiment and learn through its Surface devices, with some experiments leading to successful products and others serving as valuable learning experiences.
• Microsoft remains committed to its mission of driving innovation in the Windows ecosystem through Surface devices.

Smart Home Catch-Up w/ Jen Tuohy (00:27:41)

• Jen Tuyle, a guest on the Vergecast, discusses smart home technology, including the Dyson Wash G1 robot mop.
• Despite its high price and perceived over-engineering, the Dyson Wash G1 is considered innovative and may appeal to those willing to pay a premium for Dyson's products.
• The Dyson Wash G1 uses two large roller mops that constantly spray clean water and suck up dirt with agitation, offering a better mopping experience compared to traditional methods.
• Matter Casting is a new open standard for sending content between devices, regardless of brand or platform.
• Unlike other casting methods, Matter Casting replicates the app from the phone onto the TV, providing full control and an intuitive user experience.
• Currently, Matter Casting is limited to Amazon's Fire TV and only supports Prime Video, but more app developers are expected to enable it in the future.
• Matter Casting has the potential to simplify the smart home experience by enabling cross-platform casting and eliminating the need for proprietary protocols.
• However, the adoption of Matter Casting faces challenges as major TV manufacturers like Samsung have not yet committed to implementing it on their devices.

Matter Casting TV integration (00:39:58)

• Matter Casting TV integration requires only a software update on the TV and phone apps, making it an easier solution compared to AirPlay and Google Cast.
• If Amazon succeeds in getting TV and app manufacturers on board, Matter Casting could offer a more seamless user experience by supporting all platforms.
• Matter Casting has long-term potential but may not have a significant impact in the short term.
• Matter Casting could be a big deal for Prime Video and Fire TV customers.
• Matter 1.3 was released a few weeks ago.

Matter 1.3: new features (00:41:35)

• Matter 1.3 introduces more device types, energy reporting features, and Electric Vehicle Management capabilities, enhancing smart home control and energy efficiency.
• Energy management features in Matter 1.3 enable automatic resource conservation and cost-saving, making it a significant driver for smart home adoption.
• Matter aims to simplify smart home control, improve user experience, and potentially create a positive feedback loop where increased control leads to more data for continuous improvement.
• Partnerships with electric companies could be facilitated by Matter, enabling the development of virtual power plants that utilize smart homes and appliances to reduce strain on the power grid and promote energy efficiency.
• Some major device categories, such as heat pumps and water heaters, are yet to be supported by Matter.

Matter's missing pieces (00:49:07)

• Cameras are missing from Matter, with limited functionality expected in the future.
• Added features like AI identification will still require manufacturer apps.
• Security systems are unlikely to be fully integrated with Matter due to certification requirements.
• Bridging may allow for some control of security systems within the Matter app.
• Adaptive lighting control is still in development and will require manufacturer apps for advanced features.
• Microsoft saw a gap in the market for premium Windows laptops.
• Surface devices were designed to showcase the best of Windows and compete with Apple's MacBooks.
• Microsoft wanted to create a cohesive ecosystem of hardware and software.
• Surface devices helped Microsoft to establish a stronger presence in the consumer market.
• Surface devices pushed other PC manufacturers to improve their designs and hardware.
• The success of Surface laptops helped to revive the Windows laptop market.
• Microsoft's focus on innovation and design influenced the entire PC industry.
• Surface devices set a new standard for premium Windows laptops.

Brilliant's struggles (00:52:02)

• Brilliant, a smart home company, is struggling and looking for a buyer.
• Their smart light switch, which also acts as a smart home controller, has limited integrations and lacks support for the Matter standard or Thread protocol.
• Brilliant's high cost, starting at $400 for a light switch, has hindered adoption.
• The company's next-generation product, despite improvements, still lacks Matter and Thread support.
• Brilliant's challenges reflect the difficulties faced by startups in the smart home industry, with many pioneers being acquired or stagnating in innovation.

Google's New Home APIs (00:56:43)

• Google introduced new home APIs at Google IO, allowing developers and device makers to access connected devices like thermostats, smoke alarms, and cameras, as well as the automation engine, enabling the creation of smart home experiences without using the Google Home app.
• Open APIs are essential for the smart home ecosystem, ensuring devices continue to function even if the manufacturer ceases operations.
• Companies like ADT are already utilizing Google Home APIs for facial recognition and trusted neighbor features.
• Microsoft's Surface, initially marketed as a smart home device, lacked true smart home functionality, but its integration with DoorDash demonstrates the potential for non-smart home device makers to leverage its capabilities.
• The Surface's potential lies in inspiring developers to create innovative smart home experiences beyond basic routines, which could significantly benefit smart home device makers, home-related companies, and platforms like Uber or Airbnb.
• The progress of the smart home ecosystem is hindered by the lack of support from major platforms like Google and Apple for the latest Matter standards, which need to be fully embraced and promoted to attract developers and generate consumer excitement.
• Apple's upcoming WWDC might bring smart home-related announcements, but skepticism exists that it will primarily focus on AI.

Smart Chicken Coop (01:05:59)

• The speaker is testing a new smart chicken coop called "Coupé".
• The coop has two cameras with impressive AI capabilities.
• It can detect if the door is open, if there's an egg laid, count the chickens, and spot predators like foxes, coyotes, cats, or bobcats.
• It also has an automatic door that opens and closes based on sunrise or sunset.
• The coop is quite small and costs around $2,500.
• The speaker finds it interesting to see smart home innovation moving into homesteading and gardening.
• The Vergecast received many questions about search engines.
• One particular question caught the speaker's attention.

The future of search engines and AI integration (Vergecast Hotline) (01:08:21)

• Google's dominance in the search engine market makes its AI-generated responses more impactful than those of other browsers.
• AI tools like Bing and Perplexity bypass the traditional value exchange of the internet by providing information without linking back to the original source.
• Google's shift away from being a search engine that surfaces relevant information to users and towards becoming an arbiter of truth and original content raises concerns about its potential negative impact on publishers, bloggers, and website creators.
• The unintended consequences of Google's AI-powered reviews and recommendations, such as promoting harmful or inaccurate information, are also highlighted.
• The Vergecast, a podcast produced by Andrew Marino, Liam James, and Will, will return on Friday to discuss more OpenAI developments, upcoming announcements at WWDC, and other topics.