 We're in the electronic section of Walmart. If you've ever been in one, you probably know that they sell a lot of Vizio TVs here. What you probably don't know is that Vizio is an American company. It's actually a really small American company. It's 400 employees, about half of whom work in the call center. But with Walmart's help, they've become the number one TV manufacturer in the United States. Now that small team is taking the experience and strategy it's learned here and it's moving to the PC aisle. People look at the PC industry and they go, you guys are crazy. We have analysts that will say you're crazy. It's a huge market, granted, but it's packed with large elephants. Companies that have been in the industry for a long time, they have 20, 30 percent market share. How are you going to unseat them? They've got teams of 50,000 employees. You can't do that. You can't enter a mature, stagnant market and hope to capture a lot of market share. The easy answer to that is that's exactly what the TV industry was eight years ago. For anybody who's thinking of starting a company, don't avoid the mature market. Sometimes those are the easiest ones to go disrupt because everyone's asleep. One of the things that's striking about your product is that you're running stock windows. There's very little customization done to the software. There's none of that. One of the biggest trends over the past three or four years has been really tight coupling of hardware and software. You're running this very stock, this could be Windows anywhere, by disk. Did you think about that when you were designing the hardware? The choice to actually remove a lot of that, cleaning all of that off, I think goes hand in hand with the design and the approach that we took, the philosophy we took, which is really to break it down to its minimum form, something that's very striking but not going to be cluttered. I think Windows, especially the evolution that's coming with Windows 8, it goes very much hand in hand with the cleanliness of the design and the impression that you get not only when you see the product closed or locked up and you open it up and see Windows running on it. Obviously our readers are incredibly excited about being able to just buy a clean PC. Is it tempting though to take the subsidized, to push that price even lower and start to compete? Yeah it is, it is, but we thought about it for 30 seconds. Honestly, first it's a differentiator, it does set us apart, so it's very easy to market a product that's clean when everything else is completely messed up. It's a sad state of affairs. It is sad, and so you can stand out just by making the correct decision. In the design of the product we considered the bottom as much as we did the top, and going with the philosophy of bold details but minimal breaks, minimal surfaces, not having the stickers and all the crap that ends up on PCs and laptops. I hate opening up a PC and seeing stickers all over the place and flashing blinking LEDs. I know each one of those has a purpose and there's a reason behind the choices that were made to put them in there, but we countered that by asking why. I'd be equally proud to leave this on the table like this because I think it's a beautiful design as it is. It's not an embarrassing side you have to flip over. I think there's a benefit that Vizio has entering this market is we don't have the legacy that our competitors have. The core of this was to retain these four pieces. One thing that's really interesting in the entire PC market to me is the trackpad. How did you manage to build a trackpad that's good, and is it actually good? It's good. You get to try it later. We're in mass production tomorrow on our laptops, and we're still fine-tuning today and tonight on the trackpads. It's a mix of hardware and software. First you have to pick the right hardware. You've got to pick a sensor from a top vendor. The shape and the size relative to the keyboard actually matters a lot. The physical click mechanism and the substructure that actually holds it. There's a lot of hardware choice, not only component but also mechanical on how you build it. From then on it's software tuning and it's driver tuning. I could go on for six hours on all the vulgar details of how to make a good trackpad. Let me ask you this. I believe you. I'm going to have to try it and find out. Why were you able to do this and no other vendor has ever been able to do this? Focus. It's realizing that trackpads have sucked for a really long time and making that something that we wanted to get right. Here's the other one. A lot kind of going on here. How's it going with the hinge? This whole hinge is mounted to the subframe inside the LCD that the back cover goes over. All of the mechanical hard connection points are happening inside here. Aren't all desktops dropping? Not all in ones. All in ones are growing. All in ones are growing? Absolutely. All in ones are growing. Compared to the rate of laptops? Yes, absolutely. It's the fastest growing form factor in PCs by far. People are getting enough horsepower out of an all in one. It's easy. It's beautiful. I don't have a big four liter box under my desk. Do you think that's because people have tablets? I don't know. I don't know if that's... That goes right back to the center of digital hub. I've got this consumption device and I'm walking all over with it. I've got to put all my stuff somewhere. I think it's... I don't know. That's a good question. I don't know exactly why. It's growing and the interest in it is growing very, very high. I think this will be one of the top performing all in ones in the world when we launch it. How are you going to sell these guys? Are you going to Walmart? Yes. Same thing. Same deal. If you're watching what Walmart is doing, go into a top Walmart recently and you will see them transforming their electronic section into something that honestly competes with Best Buy. They're ratcheting up what they're bringing in. They're ratcheting up the quality of the retail experience there. That matches us perfect. Most PCs are still sold through traditional retail. We hope to bring this premium product to the mass market. That's what we do. It's very easy for us to actually sell this at $2,000 and we do fine. That's not interesting to us. What we like to do is create great technology and sell boatloads of it to every American, every consumer that wants it. Being a small American company actually has its advantages and disadvantages. We tend to focus on the advantages and actually leverage them as best we can. The disadvantage is we only have so many resources and we can only do so many things. What that makes us do though is it makes us focus. It makes us focus on the products that we think are right and get those done and get those done well. Because I'm not going to build 100 different products in different categories. We just can't do that. We have to get into a category, win it, and move on to the next one and be very deliberate about what we do. I think that's actually the good side of having to have focus and being small. But I think the other advantages is we're extremely fast. We can move extraordinarily quickly. We can think about a product and actually have it at one of our retailers within six months. And I mean conception, design, electrical engineering, software engineering, EVT, PVT, full design verification, QA, shipping, and actually have it sit on a retail shelf within six months. No other company can do that in the consumer electronics space. There's kind of a lot made in my part of the tech industry, kind of the new company, where you can't be a hardware startup. You can't just start making new hardware. It's impossible. You guys seem to be defying that trend. What would you say to somebody who wants to do a hardware startup? Do it. If that's where your passion is and that's where you think you can make a difference, do it. There's no reason. Again, we entered an extremely mature industry 10 years ago. TVs, it was stagnant, dead. We came in and really disrupted it. In a lot of ways, hardware is actually a physical instantiation of software. And that's kind of what's happening nowadays, right? I mean, we're shipping a tablet, and great, there is a tablet, and it's great hardware and everything, but that's really a physical instantiation of Android, right? So you can't decouple the two totally. And if you're a product guy, if you're somebody who just loves products and you think you can innovate in hardware, do it. There's no reason you can't do it, especially now, the way that technology is done, the way that you can leverage partner companies and the amount of talent that's out there, there's no reason not to do it.
 We're in the electronic section of Walmart.
 If you've ever been in one, you probably know that they sell a lot of Vizio TVs here.
 What you probably don't know is that Vizio is an American company.
 It's actually a really small American company.
 It's 400 employees, about half of whom work in the call center.
 But with Walmart's help, they've become the number one TV manufacturer in the United States.
 Now that small team is taking the experience and strategy it's learned here and it's moving to the PC aisle.
 People look at the PC industry and they go, you guys are crazy.
 We have analysts that will say you're crazy.
 It's a huge market, granted, but it's packed with large elephants.
 Companies that have been in the industry for a long time, they have 20, 30 percent market share.
 How are you going to unseat them? They've got teams of 50,000 employees.
 You can't do that. You can't enter a mature, stagnant market and hope to capture a lot of market share.
 The easy answer to that is that's exactly what the TV industry was eight years ago.
 For anybody who's thinking of starting a company, don't avoid the mature market.
 Sometimes those are the easiest ones to go disrupt because everyone's asleep.
 One of the things that's striking about your product is that you're running stock windows.
 There's very little customization done to the software. There's none of that.
 One of the biggest trends over the past three or four years has been really tight coupling of hardware and software.
 You're running this very stock, this could be Windows anywhere, by disk.
 Did you think about that when you were designing the hardware?
 The choice to actually remove a lot of that, cleaning all of that off, I think goes hand in hand with the design and the approach that we took,
 the philosophy we took, which is really to break it down to its minimum form, something that's very striking but not going to be cluttered.
 I think Windows, especially the evolution that's coming with Windows 8, it goes very much hand in hand with the cleanliness of the design
 and the impression that you get not only when you see the product closed or locked up and you open it up and see Windows running on it.
 Obviously our readers are incredibly excited about being able to just buy a clean PC.
 Is it tempting though to take the subsidized, to push that price even lower and start to compete?
 Yeah it is, it is, but we thought about it for 30 seconds.
 Honestly, first it's a differentiator, it does set us apart, so it's very easy to market a product that's clean when everything else is completely messed up.
 It's a sad state of affairs.
 It is sad, and so you can stand out just by making the correct decision.
 In the design of the product we considered the bottom as much as we did the top,
 and going with the philosophy of bold details but minimal breaks, minimal surfaces, not having the stickers and all the crap that ends up on PCs and laptops.
 I hate opening up a PC and seeing stickers all over the place and flashing blinking LEDs.
 I know each one of those has a purpose and there's a reason behind the choices that were made to put them in there, but we countered that by asking why.
 I'd be equally proud to leave this on the table like this because I think it's a beautiful design as it is.
 It's not an embarrassing side you have to flip over.
 I think there's a benefit that Vizio has entering this market is we don't have the legacy that our competitors have.
 The core of this was to retain these four pieces.
 One thing that's really interesting in the entire PC market to me is the trackpad.
 How did you manage to build a trackpad that's good, and is it actually good?
 It's good. You get to try it later.
 We're in mass production tomorrow on our laptops, and we're still fine-tuning today and tonight on the trackpads.
 It's a mix of hardware and software.
 First you have to pick the right hardware. You've got to pick a sensor from a top vendor.
 The shape and the size relative to the keyboard actually matters a lot.
 The physical click mechanism and the substructure that actually holds it.
 There's a lot of hardware choice, not only component but also mechanical on how you build it.
 From then on it's software tuning and it's driver tuning.
 I could go on for six hours on all the vulgar details of how to make a good trackpad.
 Let me ask you this. I believe you. I'm going to have to try it and find out.
 Why were you able to do this and no other vendor has ever been able to do this?
 Focus. It's realizing that trackpads have sucked for a really long time and making that something that we wanted to get right.
 Here's the other one. A lot kind of going on here.
 How's it going with the hinge?
 This whole hinge is mounted to the subframe inside the LCD that the back cover goes over.
 All of the mechanical hard connection points are happening inside here.
 Aren't all desktops dropping?
 Not all in ones. All in ones are growing.
 All in ones are growing?
 Absolutely. All in ones are growing.
 Compared to the rate of laptops?
 Yes, absolutely. It's the fastest growing form factor in PCs by far.
 People are getting enough horsepower out of an all in one. It's easy. It's beautiful. I don't have a big four liter box under my desk.
 Do you think that's because people have tablets?
 I don't know. I don't know if that's...
 That goes right back to the center of digital hub.
 I've got this consumption device and I'm walking all over with it. I've got to put all my stuff somewhere.
 I think it's... I don't know. That's a good question. I don't know exactly why.
 It's growing and the interest in it is growing very, very high.
 I think this will be one of the top performing all in ones in the world when we launch it.
 How are you going to sell these guys? Are you going to Walmart?
 Yes. Same thing.
 Same deal.
 If you're watching what Walmart is doing, go into a top Walmart recently and you will see them transforming their electronic section into something that honestly competes with Best Buy.
 They're ratcheting up what they're bringing in. They're ratcheting up the quality of the retail experience there.
 That matches us perfect. Most PCs are still sold through traditional retail.
 We hope to bring this premium product to the mass market. That's what we do.
 It's very easy for us to actually sell this at $2,000 and we do fine.
 That's not interesting to us. What we like to do is create great technology and sell boatloads of it to every American, every consumer that wants it.
 Being a small American company actually has its advantages and disadvantages.
 We tend to focus on the advantages and actually leverage them as best we can.
 The disadvantage is we only have so many resources and we can only do so many things.
 What that makes us do though is it makes us focus.
 It makes us focus on the products that we think are right and get those done and get those done well.
 Because I'm not going to build 100 different products in different categories. We just can't do that.
 We have to get into a category, win it, and move on to the next one and be very deliberate about what we do.
 I think that's actually the good side of having to have focus and being small.
 But I think the other advantages is we're extremely fast.
 We can move extraordinarily quickly.
 We can think about a product and actually have it at one of our retailers within six months.
 And I mean conception, design, electrical engineering, software engineering, EVT, PVT, full design verification, QA, shipping, and actually have it sit on a retail shelf within six months.
 No other company can do that in the consumer electronics space.
 There's kind of a lot made in my part of the tech industry, kind of the new company, where you can't be a hardware startup.
 You can't just start making new hardware. It's impossible.
 You guys seem to be defying that trend.
 What would you say to somebody who wants to do a hardware startup?
 Do it. If that's where your passion is and that's where you think you can make a difference, do it.
 There's no reason.
 Again, we entered an extremely mature industry 10 years ago. TVs, it was stagnant, dead.
 We came in and really disrupted it.
 In a lot of ways, hardware is actually a physical instantiation of software.
 And that's kind of what's happening nowadays, right?
 I mean, we're shipping a tablet, and great, there is a tablet, and it's great hardware and everything,
 but that's really a physical instantiation of Android, right?
 So you can't decouple the two totally.
 And if you're a product guy, if you're somebody who just loves products and you think you can innovate in hardware, do it.
 There's no reason you can't do it, especially now, the way that technology is done,
 the way that you can leverage partner companies and the amount of talent that's out there, there's no reason not to do it.