(upbeat music) >> Welcome back to Boston, everybody. This is the birthplace of theCUBE. In 2010, May of 2010 at EMC World, right in this very venue, John Furrier called it the chowder and lobster post. I'm Dave Vellante. We're here at RE:INFORCE 2022, Ed Walsh, CEO of ChaosSearch. Doing a drive by Ed. Thanks so much for stopping in. You're going to help me wrap up in our final editorial segment. >> Looking forward to it. >> I really appreciate it. >> Thank you for including me. >> How about that? 2010. >> That's amazing. It was really in this-- >> Really in this building. Yeah, we had to sort of bury our way in, tunnel our way into the Blogger Lounge. We did four days. >> Weekends, yeah. >> It was epic. It was really epic. But I'm glad they're back in Boston. AWS was going to do June in Houston. >> Okay. >> Which would've been awful. >> Yeah, yeah. No, this is perfect. >> Yeah. Thank God they came back. You saw Boston in summer is great. I know it's been hot, And of course you and I are from this area. >> Yeah. >> So how you been? What's going on? I mean, it's a little crazy out there. The stock market's going crazy. >> Sure. >> Having the tech lash, what are you seeing? >> So it's an interesting time. So I ran a company in 2008. So we've been through this before. By the way, the world's not ending, we'll get through this. But it is an interesting conversation as an investor, but also even the customers. There's some hesitation but you have to basically have the right value prop, otherwise things are going to get sold. So we are seeing longer sales cycles. But it's nothing that you can't overcome. But it has to be something not nice to have, has to be a need to have. But I think we all get through it. And then there is some, on the VC side, it's now buckle down, let's figure out what to do which is always a challenge for startup plans. >> In pre 2000 you, maybe you weren't a CEO but you were definitely an executive. And so now it's different and a lot of younger people haven't seen this. You've got interest rates now rising. Okay, we've seen that before but it looks like you've got inflation, you got interest rates rising. >> Yep. >> The consumer spending patterns are changing. You had 6$, $7 gas at one point. So you have these weird crosscurrents, >> Yup. >> And people are thinking, "Okay post-September now, maybe because of the recession, the Fed won't have to keep raising interest rates and tightening. But I don't know what to root for. It's like half full, half empty. (Ed laughing) >> But we haven't been in an environment with high inflation. At least not in my career. >> Right. Right. >> I mean, I got into 92, like that was long gone, right?. >> Yeah. >> So it is a interesting regime change that we're going to have to deal with, but there's a lot of analogies between 2008 and now that you still have to work through too, right?. So, anyway, I don't think the world's ending. I do think you have to run a tight shop. So I think the grow all costs is gone. I do think discipline's back in which, for most of us, discipline never left, right?. So, to me that's the name of the game. >> What do you tell just generally, I mean you've been the CEO of a lot of private companies. And of course one of the things that you do to retain people and attract people is you give 'em stock and it's great and everybody's excited. >> Yeah. >> I'm sure they're excited cause you guys are a rocket ship. But so what's the message now that, Okay the market's down, valuations are down, the trees don't grow to the moon, we all know that. But what are you telling your people? What's their reaction? How do you keep 'em motivated? >> So like anything, you want over communicate during these times. So I actually over communicate, you get all these you know, the Sequoia decks, 2008 and the recent... >> (chuckles) Rest in peace good times, that one right? >> I literally share it. Why? It's like, Hey, this is what's going on in the real world. It's going to affect us. It has almost nothing to do with us specifically, but it will affect us. Now we can't not pay attention to it. It does change how you're going to raise money, so you got to make sure you have the right runway to be there. So it does change what you do, but I think you over communicate. So that's what I've been doing and I think it's more like a student of the game, so I try to share it, and I say some appreciate it others, I'm just saying, this is normal, we'll get through this and this is what happened in 2008 and trust me, once the market hits bottom, give it another month afterwards. Then everyone says, oh, the bottom's in and we're back to business. Valuations don't go immediately back up, but right now, no one knows where the bottom is and that's where kind of the world's ending type of things. >> Well, it's interesting because you talked about, I said rest in peace good times >> Yeah >> that was the Sequoia deck, and the message was tighten up. Okay, and I'm not saying you shouldn't tighten up now, but the difference is, there was this period of two years of easy money and even before that, it was pretty easy money. >> Yeah. >> And so companies are well capitalized, they have runway so it's like, okay, I was talking to Frank Slootman about this now of course there are public companies, like we're not taking the foot off the gas. We're inherently profitable, >> Yeah. >> we're growing like crazy, we're going for it. You know? So that's a little bit of a different dynamic. There's a lot of good runway out there, isn't there? >> But also you look at the different companies that were either born or were able to power through those environments are actually better off. You come out stronger in a more dominant position. So Frank, listen, if you see what Frank's done, it's been unbelievable to watch his career, right?. In fact, he was at Data Domain, I was Avamar so, but look at what he's done since, he's crushed it. Right? >> Yeah. >> So for him to say, Hey, I'm going to literally hit the gas and keep going. I think that's the right thing for Snowflake and a right thing for a lot of people. But for people in different roles, I literally say that you have to take it seriously. What you can't be is, well, Frank's in a different situation. What is it...? How many billion does he have in the bank? So it's... >> He's over a billion, you know, over a billion. Well, you're on your way Ed. >> No, no, no, it's good. (Dave chuckles) Okay, I want to ask you about this concept that we've sort of we coined this term called Supercloud. >> Sure. >> You could think of it as the next generation of multi-cloud. The basic premises that multi-cloud was largely a symptom of multi-vendor. Okay. I've done some M&A, I've got some Shadow IT, spinning up, you know, Shadow clouds, projects. But it really wasn't a strategy to have a continuum across clouds. And now we're starting to see ecosystems really build, you know, you've used the term before, standing on the shoulders of giants, you've used that a lot. >> Yep. >> And so we're seeing that. Jerry Chen wrote a seminal piece on Castles in The Cloud, so we coined this term SuperCloud to connote this abstraction layer that hides the underlying complexities and primitives of the individual clouds and then adds value on top of it and can adjudicate and manage, irrespective of physical location, Supercloud. >> Yeah. >> Okay. What do you think about that concept?. How does it maybe relate to some of the things that you're seeing in the industry? >> So, standing on shoulders of giants, right? So I always like to do hard tech either at big company, small companies. So we're probably your definition of a Supercloud. We had a big vision, how to literally solve the core challenge of analytics at scale. How are you going to do that? You're not going to build on your own. So literally we're leveraging the primitives, everything you can get out of the Amazon cloud, everything get out of Google cloud. In fact, we're even looking at what it can get out of this Snowflake cloud, and how do we abstract that out, add value to it? That's where all our patents are. But it becomes a simplified approach. The customers don't care. Well, they care where their data is. But they don't care how you got there, they just want to know the end result. So you simplify, but you gain the advantages. One thing's interesting is, in this particular company, ChaosSearch, people try to always say, at some point the sales cycle they say, no way, hold on, no way that can be fast no way, or whatever the different issue. And initially we used to try to explain our technology, and I would say 60% was explaining the public, cloud capabilities and then how we, harvest those I guess, make them better add value on top and what you're able to get is something you couldn't get from the public clouds themselves and then how we did that across public clouds and then extracted it. So if you think about that like, it's the Shoulders of giants. But what we now do, literally to avoid that conversation because it became a lengthy conversation. So, how do you have a platform for analytics that you can't possibly overwhelm for ingest. All your messy data, no pipelines. Well, you leverage things like S3 and EC2, and you do the different security things. You can go to environments say, you can't possibly overrun me, I could not say that. If I didn't literally build on the shoulders giants of all these public clouds. But the value. So if you're going to do hard tech as a startup, you're going to build, you're going to be the principles of Supercloud. Maybe they're not the same size of Supercloud just looking at Snowflake, but basically, you're going to leverage all that, you abstract it out and that's where you're able to have a lot of values at that. >> So let me ask you, so I don't know if there's a strict definition of Supercloud, We sort of put it out to the community and said, help us define it. So you got to span multiple clouds. It's not just running in each cloud. There's a metadata layer that kind of understands where you're pulling data from. Like you said you can pull data from Snowflake, it sounds like we're not running on Snowflake, correct? >> No, complimentary to them in their different customers. >> Yeah. Okay. >> They want to build on top of a data platform, data apps. >> Right. And of course they're going cross cloud. >> Right. >> Is there a PaaS layer in there? We've said there's probably a Super PaaS layer. You're probably not doing that, but you're allowing people to bring their own, bring your own PaaS sort of thing maybe. >> So we're a little bit different but basically we publish open APIs. We don't have a user interface. We say, keep the user interface. Again, we're solving the challenge of analytics at scale, we're not trying to retrain your analytics, either analysts or your DevOps or your SOV or your Secop team. They use the tools they already use. Elastic search APIs, SQL APIs. So really they program, they build applications on top of us, Equifax is a good example. Case said it coming out later on this week, after 18 months in production but, basically they're building, we provide the abstraction layer, the quote, I'm going to kill it, Jeff Tincher, who owns all of SREs worldwide, said to the effect of, Hey I'm able to rethink what I do for my data pipelines. But then he also talked about how, that he really doesn't have to worry about the data he puts in it. We deal with that. And he just has to, just query on the other side. That simplicity. We couldn't have done that without that. So anyway, what I like about the definition is, if you were going to do something harder in the world, why would you try to rebuild what Amazon, Google and Azure or Snowflake did? You're going to add things on top. We can still do intellectual property. We're still doing patents. So five grand patents all in this. But literally the abstraction layer is the simplification. The end users do not want to know that complexity, even though they ask the questions. >> And I think too, the other attribute is it's ecosystem enablement. Whereas I think, >> Absolutely >> in general, in the Multicloud 1.0 era, the ecosystem wasn't thinking about, okay, how do I build on top and abstract that. So maybe it is Multicloud 2.0, We chose to use Supercloud. So I'm wondering, we're at the security conference, >> RE: INFORCE is there a security Supercloud? Maybe Snyk has the developer Supercloud or maybe Okta has the identity Supercloud. I think CrowdStrike maybe not. Cause CrowdStrike competes with Microsoft. So maybe, because Microsoft, what's interesting, Merritt Bear was just saying, look, we don't show up in the spending data for security because we're not charging for most of our security. We're not trying to make a big business. So that's kind of interesting, but is there a potential for the security Supercloud? >> So, I think so. But also, I'll give you one thing I talked to, just today, at least three different conversations where everyone wants to log data. It's a little bit specific to us, but basically they want to do the security data lake. The idea of, and Snowflake talks about this too. But the idea of putting all the data in one repository and then how do you abstract out and get value from it? Maybe not the perfect, but it becomes simple to do but hard to get value out. So the different players are going to do that. That's what we do. We're able to, once you land it in your S3 or it doesn't matter, cloud of choice, simple storage, we allow you to get after that data, but we take the primitives and hide them from you. And all you do is query the data and we're spinning up stateless computer to go after it. So then if I look around the floor. There's going to be a bunch of these players. I don't think, why would someone in this floor try to recreate what Amazon or Google or Azure had. They're going to build on top of it. And now the key thing is, do you leave it in standard? And now we're open APIs. People are building on top of my open APIs or do you try to put 'em in a walled garden? And they're in, now your Supercloud. Our belief is, part of it is, it needs to be open access and let you go after it. >> Well. And build your applications on top of it openly. >> They come back to snowflake. That's what Snowflake's doing. And they're basically saying, Hey come into our proprietary environment. And the benefit is, and I think both can win. There's a big market. >> I agree. But I think the benefit of Snowflake's is, okay, we're going to have federated governance, we're going to have data sharing, you're going to have access to all the ecosystem players. >> Yep. >> And as everything's going to be controlled and you know what you're getting. The flip side of that is, Databricks is the other end >> Yeah. >> of that spectrum, which is no, no, you got to be open. >> Yeah. >> So what's going to happen, well what's happening clearly, is Snowflake's saying, okay we've got Snowpark. we're going to allow Python, we're going to have an Apache Iceberg. We're going to have open source tooling that you can access. By the way, it's not going to be as good as our waled garden where the flip side of that is you get Databricks coming at it from a data science and data engineering perspective. And there's a lot of gaps in between, aren't there? >> And I think they both win. Like for instance, so we didn't do Snowpark integration. But we work with people building data apps on top of Snowflake or data bricks. And what we do is, we can add value to that, or what we've done, again, using all the Supercloud stuff we're done. But we deal with the unstructured data, the four V's coming at you. You can't pipeline that to save. So we actually could be additive. As they're trying to do like a security data cloud inside of Snowflake or do the same thing in Databricks. That's where we can play. Now, we play with them at the application level that they get some data from them and some data for us. But I believe there's a partnership there that will do it inside their environment. To us they're just another large scaler environment that my customers want to get after data. And they want me to abstract it out and give value. >> So it's another repository to you. >> Yeah. >> Okay. So I think Snowflake recently added support for unstructured data. You chose not to do Snowpark because why? >> Well, so the way they're doing the unstructured data is not bad. It's JSON data. Basically, This is the dilemma. Everyone wants their application developers to be flexible, move fast, securely but just productivity. So you get, give 'em flexibility. The problem with that is analytics on the end want to be structured to be performant. And this is where Snowflake, they have to somehow get that raw data. And it's changing every day because you just let the developers do what they want now, in some structured base, but do what you need to do your business fast and securely. So it completely destroys. So they have large customers trying to do big integrations for this messy data. And it doesn't quite work, cause you literally just can't make the pipelines work. So that's where we're complimentary do it. So now, the particular integration wasn't, we need a little bit deeper integration to do that. So we're integrating, actually, at the data app layer. But we could, see us and I don't, listen. I think Snowflake's a good actor. They're trying to figure out what's best for the customers. And I think we just participate in that. >> Yeah. And I think they're trying to figure out >> Yeah. >> how to grow their ecosystem. Because they know they can't do it all, in fact, >> And we solve the key thing, they just can't do certain things. And we do that well. Yeah, I have SQL but that's where it ends. >> Yeah. >> I do the messy data and how to play with them. >> And when you talk to one of their founders, anyway, Benoit, he comes on the cube and he's like, we start with simple. >> Yeah. >> It reminds me of the guy's some Pure Storage, that guy Coz, he's always like, no, if it starts to get too complicated. So that's why they said all right, we're not going to start out trying to figure out how to do complex joins and workload management. And they turn that into a feature. So like you say, I think both can win. It's a big market. >> I think it's a good model. And I love to see Frank, you know, move. >> Yeah. I forgot So you AVMAR... >> In the day. >> You guys used to hate each other, right? >> No, no, no >> No. I mean, it's all good. >> But the thing is, look what he's done. Like I wouldn't bet against Frank. I think it's a good message. You can see clients trying to do it. Same thing with Databricks, same thing with BigQuery. We get a lot of same dynamic in BigQuery. It's good for a lot of things, but it's not everything you need to do. And there's ways for the ecosystem to play together. >> Well, what's interesting about BigQuery is, it is truly cloud native, as is Snowflake. You know, whereas Amazon Redshift was sort of Parexel, it's cobbled together now. It's great engineering, but BigQuery gets a lot of high marks. But again, there's limitations to everything. That's why companies like yours can exist. >> And that's why.. so back to the Supercloud. It allows me as a company to participate in that because I'm leveraging all the underlying pieces. Which we couldn't be doing what we're doing now, without leveraging the Supercloud concepts right, so... >> Ed, I really appreciate you coming by, help me wrap up today in RE:INFORCE. Always a pleasure seeing you, my friend. >> Thank you. >> All right. Okay, this is a wrap on day one. We'll be back tomorrow. I'll be solo. John Furrier had to fly out but we'll be following what he's doing. This is RE:INFORCE 2022. You're watching theCUBE. I'll see you tomorrow.

from the cube studios in palo alto in boston bringing you data-driven insights from the cube and etr this is breaking analysis with dave vellante you know we've often said that the next 10 years in cloud computing won't be like the last ten cloud has firmly planted its footprint on the other side of the chasm with the momentum of the entire multi-trillion dollar tech business behind it both sellers and buyers are leaning in by adopting cloud technologies and many are building their own value layers on top of cloud in the coming years we expect innovation will continue to coalesce around the three big u.s clouds plus alibaba in apac with the ecosystem building value on top of the hardware saw tooling provided by the hyperscalers now importantly we don't see this as a race to the bottom rather our expectation is that the large public cloud players will continue to take cost out of their platforms through innovation automation and integration while other cloud providers and the ecosystem including traditional companies that buy it mine opportunities in their respective markets as matt baker of dell is fond of saying this is not a zero sum game welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll update you on our latest projections in the cloud market we'll share some new etr survey data with some surprising nuggets and drill into this the important cloud database landscape first we want to take a look at what people are talking about in cloud and what's been in the recent news with the exception of alibaba all the large cloud players have reported earnings google continues to focus on growth at the expense of its profitability google reported that it's cloud business which includes applications like google workspace grew 45 percent to five and a half billion dollars but it had an operating loss of 890 billion now since thomas curion joined google to run its cloud business google has increased head count in its cloud business from 25 000 25 000 people now it's up to 40 000 in an effort to catch up to the two leaders but playing catch up is expensive now to put this into perspective let's go back to aws's revenue in q1 2018 when the company did 5.4 billion so almost exactly the same size as google's current total cloud business and aws is growing faster at the time at 49 don't forget google includes in its cloud numbers a big chunk of high margin software aws at the time had an operating profit of 1.4 billion that quarter around 26 of its revenues so it was a highly profitable business about as profitable as cisco's overall business which again is a great business this is what happens when you're number three and didn't get your head out of your ads fast enough now in fairness google still gets high marks on the quality of its technology according to corey quinn of the duck bill group amazon and google cloud are what he called neck and neck with regard to reliability with microsoft azure trailing because of significant disruptions in the past these comments were made last week in a bloomberg article despite some recent high-profile outages on aws not surprisingly a microsoft spokesperson said that the company's cloud offers industry-leading reliability and that gives customers payment credits after some outages thank you turning to microsoft and cloud news microsoft's overall cloud business surpassed 22 billion in the december quarter up 32 percent year on year like google microsoft includes application software and sas offerings in its cloud numbers and gives little nuggets of guidance on its azure infrastructure as a service business by the way we estimate that azure comprises about 45 percent of microsoft's overall cloud business which we think hit a 40 billion run rate last quarter microsoft guided in its earning call that recent declines in the azure growth rates will reverse in q1 and that implies sequential growth for azure and finally it was announced that the ftc not the doj will review microsoft's announced 75 billion acquisition of activision blizzard it appears ftc chair lena khan wants to take this one on herself she of course has been very outspoken about the power of big tech companies and in recent a recent cnbc interview suggested that the u.s government's actions were a meaningful contributor back then to curbing microsoft's power in the 90s i personally found that dubious just ask netscape wordperfect novell lotus and spc the maker of harvard presentation graphics how effective the government was in curbing microsoft power generally my take is that the u s government has had a dismal record regulating tech companies most notably ibm and microsoft and it was market forces company hubris complacency and self-inflicted wounds not government intervention these were far more effective than the government now of course if companies are breaking the law they should be punished but the u.s government hasn't been very productive in its actions and the unintended consequences of regulation could be detrimental to the u.s competitiveness in the race with china but i digress lastly in the news amazon announced earnings thursday and the company's value increased by 191 billion dollars on friday that's a record valuation gain for u.s stocks aws amazon's profit engine grew 40 percent year on year for the quarter it closed the year at 62 billion dollars in revenue and at a 71 billion dollar revenue run rate aws is now larger than ibm which without kindrel is at a 67 billion dollar run rate just for context ibm's revenue in 2011 was 107 billion dollars now there's a conversation going on in the media and social that in order to continue this growth and compete with microsoft that aws has to get into the sas business and offer applications we don't think that's the right strategy for amp from for amazon in the near future rather we see them enabling developers to compete in that business finally amazon disclosed that 48 of its top 50 customers are using graviton 2 instances why is this important because aws is well ahead of the competition in custom silicon chips is and is on a price performance curve that is far better than alternatives especially those based on x86 this is one of the reasons why we think this business is not a race to the bottom aws is being followed by google microsoft and alibaba in terms of developing custom silicon and will continue to drive down their internal cost structures and deliver price performance equal to or better than the historical moore's law curves so that's the recent news for the big u.s cloud providers let's now take a look at how the year ended for the big four hyperscalers and look ahead to next year here's a table we've shown this view before it shows the revenue estimates for worldwide is and paths generated by aws microsoft alibaba and google now remember amazon and alibaba they share clean eye ass figures whereas microsoft and alphabet only give us these nuggets that we have to interpret and we correlate those tidbits with other data that we gather we're one of the few outlets that actually attempts to make these apples to apples comparisons there's a company called synergy research there's another firm that does this but i really can't map to their numbers their gcp figures look far too high and azure appears somewhat overestimated and they do include other stuff like hosted private cloud services but it's another data point that you can use okay back to the table we've slightly adjusted our gcp figures down based on interpreting some of alphabet's statements and other survey data only alibaba has yet to announce earnings so we'll stick to a 2021 market size of about 120 billion dollars that's a 41 growth rate relative to 2020 and we expect that figure to increase by 38 percent to 166 billion in 2022 now we'll discuss this a bit later but these four companies have created an opportunity for the ecosystem to build what we're calling super clouds on top of this infrastructure and we're seeing it happen it was increasingly obvious at aws re invent last year and we feel it will pick up momentum in the coming months and years a little bit more on that later now here's a graphical view of the quarterly revenue shares for these four companies notice that aws has reversed its share erosion and is trending up slightly aws has accelerated its growth rate four quarters in a row now it accounted for 52 percent of the big four hyperscaler revenue last year and that figure was nearly 54 in the fourth quarter azure finished the year with 32 percent of the hyper scale revenue in 2021 which dropped to 30 percent in q4 and you can see gcp and alibaba they're neck and neck fighting for the bronze medal by the way in our recent 2022 predictions post we said google cloud platform would surpass alibaba this year but given the recent trimming of our numbers google's got some work to do for that prediction to be correct okay just to put a bow on the wikibon market data let's look at the quarterly growth rates and you'll see the compression trends there this data tracks quarterly revenue growth rates back to 20 q1 2019 and you can see the steady downward trajectory and the reversal that aws experienced in q1 of last year now remember microsoft guided for sequential growth and azure so that orange line should trend back up and given gcp's much smaller and big go to market investments that we talked about we'd like to see an acceleration there as well the thing about aws is just remarkable that it's able to accelerate growth at a 71 billion run rate business and alibaba you know is a bit more opaque and likely still reeling from the crackdown of the chinese government we're admittedly not as close to the china market but we'll continue to watch from afar as that steep decline in growth rate is somewhat of a concern okay let's get into the survey data from etr and to do so we're going to take some time series views on some of the select cloud platforms that are showing spending momentum in the etr data set you know etr uses a metric we talked about this a lot called net score to measure that spending velocity of products and services netscore basically asks customers are you spending more less or the same on a platform and a vendor and then it subtracts the lesses from the moors and that yields a net score this chart shows net score for five cloud platforms going back to january 2020. note in the table that the table we've inserted inside that chart shows the net score and shared n the latter metric indicates the number of mentions in the data set and all the platforms we've listed here show strong presence in the survey that red dotted line at 40 percent that indicates spending is at an elevated level and you can see azure and aws and vmware cloud on aws as well as gcp are all nicely elevated and bounding off their october figures indicating continued cloud momentum overall but the big surprise in these figures is the steady climb and the steep bounce up from oracle which came in just under the 40 mark now one quarter is not necessarily a trend but going back to january 2020 the oracle peaks keep getting higher and higher so we definitely want to keep watching this now here's a look at some of the other cloud platforms in the etr survey the chart here shows the same time series and we've now brought in some of the big hybrid players notably vmware cloud which is vcf and other on-prem solutions red hat openstack which as we've reported in the past is still popular in telcos who want to build their own cloud we're also starting to see hpe with green lake and dell with apex show up more and ibm which years ago acquired soft layer which was really essentially a bare metal hosting company and over the years ibm cobbled together its own public cloud ibm is now racing after hybrid cloud using red hat openshift as the linchpin to that strategy now what this data tells us first of all these platforms they don't have the same presence in the data set as do the previous players vmware is the one possible exception but other than vmware these players don't have the spending velocity shown in the previous chart and most are below the red line hpe and dell are interesting and notable in that they're transitioning their early private cloud businesses to dell gr sorry hpe green lake and dell apex respectively and finally after years of kind of staring at their respective navels in in cloud and milking their legacy on-prem models they're finally building out cloud-like infrastructure for their customers they're leaning into cloud and marketing it in a more sensible and attractive fashion for customers so we would expect these figures are going to bounce around for a little while for those two as they settle into a groove and we'll watch that closely now ibm is in the process of a complete do-over arvin krishna inherited three generations of leadership with a professional services mindset now in the post gerschner gerstner era both sam palmisano and ginny rometty held on far too long to ibm's service heritage and protected the past from the future they missed the cloud opportunity and they forced the acquisition of red hat to position the company for the hybrid cloud remedy tried to shrink to grow but never got there krishna is moving faster and with the kindred spin is promising mid-single-digit growth which would be a welcome change ibm is a lot of work to do and we would expect its net score figures as well to bounce around as customers transition to the future all right let's take a look at all these different players in context these are all the clouds that we just talked about in a two-dimensional view the vertical axis is net score or spending momentum and the horizontal axis is market share or presence or pervasiveness in the data set a couple of call-outs that we'd like to make here first the data confirms what we've been saying what everybody's been saying aws and microsoft stand alone with a huge presence many tens of billions of dollars in revenue yet they are both well above the 40 line and show spending momentum and they're well ahead of gcp on both dimensions second vmware while much smaller is showing legitimate momentum which correlates to its public statements alibaba the alibaba in this survey really doesn't have enough sample to make hardcore conclusions um you can see hpe and dell and ibm you know similarly they got a little bit more presence in the data set but they clearly have some work to do what you're seeing there is their transitioning their legacy install bases oracle's the big surprise look what oracle was in the january survey and how they've shot up recently now we'll see if this this holds up let's posit some possibilities as to why it really starts with the fact that oracle is the king of mission critical apps now if you haven't seen video on twitter you have to check it out it's it's hilarious we're not going to run the video here but the link will be in our post but i'll give you the short version some really creative person they overlaid a data migration narrative on top of this one tooth guy who speaks in spanish gibberish but the setup is he's a pm he's a he's a a project manager at a bank and aws came into the bank this of course all hypothetical and said we can move all your apps to the cloud in 12 months and the guy says but wait we're running mission critical apps on exadata and aws says there's nothing special about exadata and he starts howling and slapping his knee and laughing and giggling and talking about the 23 year old senior engineer who says we're going to do this with microservices and he could tell he was he was 23 because he was wearing expensive sneakers and what a nightmare they encountered migrating their environment very very very funny video and anyone who's ever gone through a major migration of mission critical systems this is gonna hit home it's funny not funny the point is it's really painful to move off of oracle and oracle for all its haters and its faults is really the best environment for mission critical systems and customers know it so what's happening is oracle's building out the best cloud for oracle database and it has a lot of really profitable customers running on-prem that the company is migrating to oracle cloud infrastructure oci it's a safer bet than ripping it and putting it into somebody else's cloud that doesn't have all the specialized hardware and oracle knowledge because you can get the same integrated exadata hardware and software to run your database in the oracle cloud it's frankly an easier and much more logical migration path for a lot of customers and that's possibly what's happening here not to mention oracle jacks up the license price nearly doubles the license price if you run on other clouds so not only is oracle investing to optimize its cloud infrastructure it spends money on r d we've always talked about that really focused on mission critical applications but it's making it more cost effective by penalizing customers that run oracle elsewhere so this possibly explains why when the gartner magic quadrant for cloud databases comes out it's got oracle so well positioned you can see it there for yourself oracle's position is right there with aws and microsoft and ahead of google on the right-hand side is gartner's critical capabilities ratings for dbms and oracle leads in virtually all of the categories gartner track this is for operational dvms so it's kind of a narrow view it's like the red stack sweet spot now this graph it shows traditional transactions but gartner has oracle ahead of all vendors in stream processing operational intelligence real-time augmented transactions now you know gartner they're like old name framers and i say that lovingly so maybe they're a bit biased and they might be missing some of the emerging opportunities that for example like snowflake is pioneering but it's hard to deny that oracle for its business is making the right moves in cloud by optimizing for the red stack there's little question in our view when it comes to mission critical we think gartner's analysis is correct however there's this other really exciting landscape emerging in cloud data and we don't want it to be a blind spot snowflake calls it the data cloud jamactagani calls it data mesh others are using the term data fabric databricks calls it data lake house so so does oracle by the way and look the terminology is going to evolve and most of the action action that's happening is in the cloud quite frankly and this chart shows a select group of database and data warehouse companies and we've filtered the data for aws azure and gcp customers accounts so how are these accounts or companies that were showing how these vendors were showing doing in aws azure and gcp accounts and to make the cut you had to have a minimum of 50 mentions in the etr survey so unfortunately data bricks didn't make it just not enough presence in the data set quite quite yet but just to give you a sense snowflake is represented in this cut with 131 accounts aws 240 google 108 microsoft 407 huge [ __ ] 117 cloudera 52 just made the cut ibm 92 and oracle 208. again these are shared accounts filtered by customers running aws azure or gcp the chart shows a net score lime green is new ads forest green is spending more gray is flat spending the pink is spending less and the bright red is defection again you subtract the red from the green and you get net score and you can see that snowflake as we reported last week is tops in the data set with a net score in the 80s and virtually no red and even by the way single digit flat spend aws google and microsoft are all prominent in the data set as is [ __ ] and snowflake as i just mentioned and they're all elevated over the 40 mark cloudera yeah what can we say once they were a high flyer they're really not in the news anymore with anything compelling other than they just you know took the company private so maybe they can re-emerge at some point with a stronger story i hope so because as you can see they actually have some new additions and spending momentum in the green just a lot of customers holding steady and a bit too much red but they're in the positive territory at least with uh plus 17 percent unlike ibm and oracle and this is the flip side of the coin ibm they're knee-deep really chest deep in the middle of a major transformation we've said before arvind krishna's strategy and vision is at least achievable prune the portfolio i.e spin out kindrel sell watson health hold serve with the mainframe and deal with those product cycles shift the mix to software and use red hat to win the day in hybrid red hat is working for ibm's growing well into the double digits unfortunately it's not showing up in this chart with little database momentum in aws azure and gcp accounts zero new ads not enough acceleration and spending a big gray middle in nearly a quarter of the base in the red ibm's data and ai business only grew three percent this last quarter and the word database wasn't even mentioned once on ibm's earnings call this has to be a concern as you can see how important database is to aws microsoft google and the momentum it's giving companies like snowflake and [ __ ] and others which brings us to oracle with a net score of minus 12. so how do you square the momentum in oracle cloud spending and the strong ratings and databases from gartner with this picture good question and i would say the following first look at the profile people aren't adding oracle new a large portion of the base 25 is reducing spend by 6 or worse and there's a decent percentage of the base migrating off oracle with a big fat middle that's flat and this accounts for the poor net score overall but what etr doesn't track is how much is being spent rather it's an account based model and oracle is heavily weighted toward big spenders running mission critical applications and databases oracle's non-gaap operating margins are comparable to ibm's gross margins on a percentage basis so a very profitable company with a big license and maintenance in stall basin oracle has focused its r d investments into cloud erp database automation they've got vertical sas and they've got this integrated hardware and software story and this drives differentiation for the company but as you can see in this chart it has a legacy install base that is constantly trying to minimize its license costs okay here's a little bit of different view on the same data we expand the picture with the two dimensions of net score on the y-axis and market share or pervasiveness on the horizontal axis and the table insert is how the data gets plotted y and x respectively not much to add here other than to say the picture continues to look strong for those companies above the 40 line that are focused and their focus and have figured out a clear cloud strategy and aren't necessarily dealing with a big install base the exception of course is is microsoft and the ones below the line definitely have parts of their portfolio which have solid momentum but they're fighting the inertia of a large install base that moves very slowly again microsoft had the advantage of really azure and migrating those customers very quickly okay so let's wrap it up starting with the big three cloud players aws is accelerating and innovating great example is custom silicon with nitro and graviton and other chips that will help the company address concerns related to the race to the bottom it's not a race to zero aws we believe will let its developers go after the sas business and for the most part aws will offer solutions that address large vertical markets think call centers the edge remains a wild card for aws and all the cloud players really aws believes that in the fullness of time all workloads will run in the public cloud now it's hard for us to imagine the tesla autonomous vehicles running in the public cloud but maybe aws will redefine what it means by its cloud microsoft well they're everywhere and they're expanding further now into gaming and the metaverse when he became ceo in 2014 many people said that satya should ditch xbox just as an aside the joke among many oracle employees at the time was that safra katz would buy her kids and her nieces and her nephews and her kids friends everybody xbox game consoles for the holidays because microsoft lost money for everyone that they shipped well nadella has stuck with it and he sees an opportunity to expand through online gaming communities one of his first deals as ceo was minecraft now the acquisition of activision will make microsoft the world's number three gaming company by revenue behind only 10 cent and sony all this will be powered by azure and drive more compute storage ai and tooling now google for its part is battling to stay relevant in the conversation luckily it can afford the massive losses it endures in cloud because the company's advertising business is so profitable don't expect as many have speculated that google is going to bail on cloud that would be a huge mistake as the market is more than large enough for three players which brings us to the rest of the pack cloud ecosystems generally and aws specifically are exploding the idea of super cloud that is a layer of value that spans multiple clouds hides the underlying complexity and brings new value that the cloud players aren't delivering that's starting to bubble to the top and legacy players are staying close to their customers and fighting to keep them spending and it's working dell hpe cisco and smaller predominantly on-plan prem players like pure storage they continue to do pretty well they're just not as sexy as the big cloud players the real interesting activity it's really happening in the ecosystem of companies and firms within industries that are transforming to create their own digital businesses virtually all of them are running a portion of their offerings on the public cloud but often connecting to on-premises workloads and data think goldman sachs making that work and creating a great experience across all environments is a big opportunity and we're seeing it form right before our eyes don't miss it okay that's it for now thanks to my colleague stephanie chan who helped research this week's topics remember these episodes are all available as podcasts wherever you listen just search breaking analysis podcast check out etr's website at etr dot ai and also we publish a full report every week on wikibon.com and siliconangle.com you can get in touch with me email me at david.velante siliconangle.com you can dm me at divalante or comment on my linkedin post this is dave vellante for the cube insights powered by etr have a great week stay safe be well and we'll see you next time [Music] you

(upbeat music) >> Hello everyone, welcome back to theCUBE's coverage of splunk.com 2021 virtual. We're here live in the Splunk studios. We're all here gettin all the action, all the stories. Garth Fort, senior vice president, Chief Product Officer at Splunk is here with me. CUBE alumni. Great to see you. Last time I saw you, we were at AWS now here at Splunk. Congratulations on the new role. >> Thank you. Great to see you again. >> Great keynote and great team. Congratulations. >> Thank you. Thank you. It's a lot of fun. >> So let's get into the keynote a little bit on the product. You're the Chief Product Officer. We interviewed Shawn Bice, who's also working with you as well. He's your boss. Talk about the, the next level, cause you're seeing some new enhancements. Let's get to the news first. Talk about the new enhancements. >> Yeah, this was actually a really fun keynote for me. So I think there was a lot of great stuff that came out of the rest of it. But I had the honor to actually showcase a lot of the product innovation, you know, since we did .conf last year, we've actually closed four different acquisitions. We shipped 43 major releases and we've done hundreds of small enhancements, like we're shipping code in the cloud every six weeks and we're shipping new versions twice a year for our Splunk Enterprise customers. And so this was kind of like if you've seen that movie Sophie's Choice, you know, where you have to pick one of your children, like this was a really hard, hard thing to pick. Cause we only had about 25 minutes, but we did like four demos that I think landed really well. The first was what we call ingest actions and you know, there's customers that are using, they start small with gigabytes and they go to terabytes and up to petabytes of data per day. And so they wanted tools that allow them to kind of modify filter and then route data to different sort of parts of their infrastructure. So that was the first demo. We did another demo on our, our visual playbook editor for SOAR, which has improved quite a bit. You know, a lot of the analysts that are in the, in the, in the SOC trying to figure out how to automate responses and reduce sort of time to resolution, like they're not Python experts. And so having a visual playbook editor that lets them drag and drop and sort of with a few simple gestures create complex playbooks was pretty cool. We showed some new capabilities in our APM tool. Last year, we announced we acquired a company called Plumbr, which has expertise in basically like code level analysis and, and we're calling it "Always On" profiling. So we, we did that demo and gosh, we did one more, four, but four total demos. I think, you know, people were really happy to see, you know, the thing that we really tried to do was ground all of our sort of like tech talk and stuff that was like real and today, like this is not some futuristic vision. I mean, Shawn did lay out some, some great visions, visionary kind of pillars. But, what we showed in the keynote was I it's all shipping code. >> I mean, there's plenty of head room in this market when it comes to data as value and data in motion, all these things. But we were talking before you came on camera earlier in the morning about actually how good Splunk product and broad and deep the product portfolio as well. >> Garth: Yeah. >> I mean, it's, I mean, it's not a utility and a tooling, it's a platform with tools and utilities. >> Garth: Yeah >> It's a fully blown out platform. >> Yeah. Yeah. It is a platform and, and, you know, it's, it's one that's quite interesting. I've had the pleasure to meet a couple of big customers and it's kind of amazing, like what they do with Splunk. Like I was meeting with a large telco on the east coast and you know, they actually, for their set top boxes, they actually have to figure out in real time, which ads to display and the only tool they could find to process 15 million events in real time, to decide what ad to display, was Splunk. So that was, that was like really cool to hear. Like we never set out to be like an ad tech kind of platform and yet we're the only tool that operates at that level of scale and that kind of data. >> You know, it's funny, Doug Merritt mentioned this in my interview with him earlier today about, you know, and he wasn't shy about it, which was great. He was like, we're an enabling platform. We don't have to be experts in all these vertical industries >> Garth: Yep >> because AI takes care of that. That's where the machine learning >> Garth: Yeah >> and the applications get built. So others are trying to build fully vertically integrated stacks into these verticals when in reality they don't have to, if they don't want it. >> Yeah, and Splunk's kind of, it's quite interesting when you look across our top 100 customers, you know, Doug talks about like the, you know, 92 of the fortune 100 are kind of using Splunk today, but the diversity across industries and, you know, we have government agencies, we have, you know, you name the retail or the vertical, you know, we've got really big customers, they're using Splunk. And the other thing that I kind of, I was excited about, we announced the last demo I forgot was TruSTAR integration with Enterprise Security. That's pretty cool. We're calling that Splunk Threat Intelligence. And so That was really fun and we only acquired, we closed the acquisition to TruSTAR in May, but the good news is they've been a partner with us like for 18 months before we actually bought em. And so they'd already done a lot of the work to integrate. And so they had a running start in that regard, But other, one other one that was kind of a, it was a small thing. I didn't get to demo it, but we talked about the, the content pack for application performance monitoring. And so, you know, in some ways we compete in the APM level, but in many ways there's a ton of great APM vendors out there that customers are using. But what they wanted us to do was like, hey, if I'm using APM for that one app, I still want to get data out of that and into Splunk because Splunk ends up being like the core repository for observability, security, IT ops, Dev Sec Ops, et cetera. It's kind of like where the truth, the operational truth of how your systems works, lives in Splunk. >> It's so funny. The Splunk business model has actually been replicated. They call it data lake, whatever you want to call it. People are bringing up all these different metaphors. But at the end of the day, if you guys can create a value proposition where you can have data just be, you know, stored and dumped and dumped into whatever they call it stored in a way >> Garth: We call it ingest >> Ingested, ingested. >> Garth: Not dumped. >> Data dump. >> Garth: It's ingested. >> Well, I mean, well you given me a plan, but you don't have to do a lot of work to store just, okay, we can only get to it later, >> Garth: Yep. >> But let the machines take over >> Garth: Yep. >> With the machine learning. I totally get that. Now, as a pro, as a product leader, I have to ask you your, your mindset around optimization. What do you optimize for? Because a lot of times these use cases are emerging. They just pop out of nowhere. It's a net new use case that you want to operationalize. So balancing the headroom >> Yep. >> Or not to foreclose those new opportunities for customers. How are customers deciding what's important to them? How do you, because you're trying to read the tea leaves for the future >> Garth: A little bit, yeah. >> and then go, okay, what do our customers need, but you don't want to foreclose anything. How do you think about product strategy around that? >> There's a ton of opportunity to interact with customers. We have this thing called the Customer Advisory Board. We run, I think, four of them and we run a monthly. And so we got an opportunity to kind of get that anecdotal data and the direct contact. We also have a portal called ideas.splunk.com where customers can come tell us what they want us to build next. And we look at that every month, you know, and there's no way that we could ever build everything that they're asking us to, but we look at that monthly and we use it in sort of our sprint planning to decide where we're going to prioritize engineering resources. And it's just, it's kind of like customers say the darndest things, right? Sometimes they ask us for stuff and we never imagined building it in a million years, >> John: Yeah. >> Like that use case around ads on the set top box, but it's, it's kind of a fun place to be like, we, we just, before this event, we kind of laid out internally what, you know, Shawn and I kind of put together this doc, actually Shawn wrote the bulk of it, but it was about sort of what do we think? Where, where can we take Splunk to the next three to five years? And we talked about these, we referred to them as waves of innovation. Cause you know, like when you think about waves, there's multiple waves that are heading towards the beach >> John: Yeah. >> in parallel, right? It's not like a series of phases that are going to be serialized. It's about making a set of investments. that'll kind of land over time. And, and the first wave is really about, you know, what I would say is sort of, you know, really delivering on the promise of Splunk and some of that's around integration, single sign-on things about like making all of the Splunk Splunk products work together more easily. We've talked a lot in the Q and a about like edge and hybrid. And that's really where our customers are. If you watch the Koby Avital's sort of customer keynote, you know, Walmart by necessity, given their geographic breadth and the customers they serve has to have their own infrastructure. They use Google, they use Azure and they have this abstraction layer that Koby's team has built on top. And they use Splunk to manage kind of, operate basically all of their infrastructure across those three clouds. So that's the hybrid edge scenario. We were thinking a lot about, you mentioned data lakes. You know, if you go back to 2002, when Splunk was founded, you know, the thing we were trying to do is help people make sense of log files. But now if you talk to customers that are moving to cloud, everybody's building a data lake and there's like billions of objects flowing into millions of these S3 buckets all over the place. And we're kind of trying to think about, hey, is there an opportunity for us to point our indexing and analytics capability against structured and unstructured data and those data lakes. So that that'll be something we're going to >> Yeah. >> at least start prototyping pretty soon. And then lastly, machine learning, you know, I'd say, you know, to use a baseball metaphor, like in terms of like how we apply machine learning, we're like in the bottom of the second inning, >> Yeah. >> you know, we've been doing it for a number of years, but there's so much more. >> There's so, I mean, machine learning is only as good as the data you put into the machine learning. >> Exactly, exactly. >> And so if you have, if you have gap in the data, the machine learning is going to have gaps in it. >> Yeah. And we have, we announced a feature today called auto detect. And I won't go into the gory details, but effectively what it does is it runs a real-time analytics job over whatever metrics you want to look at and you can do what I would consider more statistics versus machine learning. You can say, hey, if in a 10 minute period, like, you know, we see more errors than we see on average over the last week, throw an alert so I can go investigate and take a look. Imagine if you didn't have to figure out what the right thresholds were, if we could just watch those metrics for you and automatically understand the seasonality, the timing, is it a weekly thing? Is it a monthly thing? And then like tell you like use machine learning to do the anomaly detection, but do it in a way that's more intelligent than just the static threshold. >> Yeah. >> And so I think you'll see things like auto detect, which we announced this week will evolve to take advantage of machine learning kind of under the covers, if you will. >> Yeah. It was interesting with cloud scale and the data velocity, automations become super important. >> Oh yeah. >> You don't have a lot of new disciplines emerge, like explainable AI is hot right now. So you got, the puck is coming. You can see where the puck is going. >> Yeah >> And that is automation at the app edge or the application layer where the data has got to be free-flowing or addressable. >> Garth: Yeah. >> This is something that is being talked about. And we talked about data divide with, with Chris earlier about the policy side of things. And now data is part of everything. It's part of the apps. >> Garth: Yeah. >> It's not just stored stuff. So it's always in flight. It should be addressable. This is what people want. What do you think about all of that? >> No, I think it's great. I actually just can I, I'll quote from Steve Schmidt in, in sort of the keynote, he said, look like security at the end of the day is a human problem, but it kind of manifests itself through data. And so being able to understand what's happening in the data will tell you, like, is there a bad actor, like wreaking havoc inside of my systems? And like, you can use that, the data trail if you will, of the bad actor to chase them down and sort of isolate em. >> The digital footprints, if you will, looking at a trail. >> Yeah. >> All right, what's the coolest thing that you like right now, when you look at the treasure trove of, of a value, as you look at it, and this is a range of value, Splunk, Splunk has had customers come in with, with the early product, but they keep the customers and they always do new things and they operationalize it >> Garth: Yep. >> and another new thing comes, they operationalize it. What's the next new thing that's coming, that's the next big thing. >> Dude that is like asking me which one of my daughters do I love the most, like that is so unfair. (laughing) I'm not going to answer that one. Next question please. >> Okay. All right. Okay. What's your goals for the next year or two? >> Yeah, so I just kind of finished roughly my first 100 days and it's been great to, you know, I had a whole plan, 30, 60, 90, and I had a bunch of stuff I wanted to do. Like I'm really hoping, sort of, we get past this current kind of COVID scare and we get to back to normal. Cause I'm really looking forward to getting back on the road and sort of meeting with customers, you know, you can meet over Zoom and that's great, but what I've learned over time, you know, I used to go, I'd fly to Wichita, Kansas and actually go sit down with the operators like at their desk and watch how they use my tools. And that actually teaches you. Like you, you come up with things when you see, you know, your product in the hands of your customer, that you don't get from like a CAB meeting or from a Zoom call, you know? >> John: Yeah, yeah. >> And so being able to visit customers where they live, where they work and kind of like understand what we can do to make their lives better. Like that's going to, I'm actually really excited to gettin back to travel. >> If you could give advice to CTO, CISO, or CIO or a practitioner out there who are, who is who's sitting at their virtual desk or their physical desk thinking, okay, the pandemic, were coming through the pandemic. I want to come out with a growth strategy, with a plan that's going to be expansive, not restrictive. The pandemic has shown what's what works, what doesn't work. >> Garth: Sure. >> So it's going to be some projects that might not get renewed, but there's doubling down on, certainly with cloud scale. What would advice would you give that person when they start thinking about, okay, I got to get my architecture right. >> Yeah. >> I got to get my playbooks in place. I got to get my people aligned. >> Yeah >> What's what do you see as a best practice for kind of the mindset to actual implementation of data, managing the data? >> Yeah, and again, I'm, I'm, this is not an original Garth thought. It actually came from one of our customers. You know, the, I think we all, like you think back to March and April of 2020 as this thing was really getting real. Everybody moved as fast as they could to either scale up or scale scaled on operations. If you were in travel and hospitality, you know, that was, you know, you had to figure how to scale down quickly and like what you could shut down safely. If you were like in the food delivery business, you had to figure out how you could scale up, like Chipotle hit two, what is it? $2 billion run rate on delivery last year. And so people scrambled as fast as they could to sort of adapt to this new world. And I think we're all coming to the realization that as we sort of exit and get back to some sense of new normal, there's a lot of what we're doing today that's going to persist. Like, I think we're going to have like flexible rules. I don't think everybody's going to want to come back into the office. And so I think, I think the thing to do is you think about returning to whatever this new normal looks like is like, what did we learn that was good. And like the pandemic had a silver lining for folks in many ways. And it sucked for a lot. I'm not saying it was a good thing, but you know, there were things that we did to adapt that I think actually made like the workplace, like stronger and better. And, and sort of. >> It showed that data's important, internet is important. Didn't break, the internet didn't break. >> Garth: Correct. >> Zoom was amazing. And the teleconferencing with other tools. >> But that's kind of, just to sort of like, what did you learn over the last 18 months that you're going to take for it into the next 18 years? You know what I mean? Cause there was a lot of good and I think people were creative and they figured out like how to adapt super quickly and take the best of the pandemic and turn it into like a better place to work. >> Hybrid, hybrid events, hybrid workforce, hybrid workflows. What's what's your vision on Splunk as a tier one enterprise? Because a lot of the news that I'm seeing that's, that's the tell sign to me in terms of this next growth wave is big SI deals, Accenture and others are yours working with and you still got the other Partnerverse going. You have the ecosystems emerging. >> Garth: Yep. >> That's a good, that means your product's enabling people to make money. >> Garth: Yeah. Yeah, yeah, yeah. >> And that's a good thing. >> Yeah, BlueVoyant was a great example in the keynote yesterday and they, you know, they've really, they've kind of figured out how, you know, most of their customers, they serve customers in heavily regulated industries kind of, and you know, those customers actually want their data in a Splunk tenant that they own and control and they want to have that secure boundary around that. But BlueVoyant's figured out how they can come in and say, hey, I'm going to take care of the heavy lifting of the day-to-day operations, the monitoring of that environment with the security. So, so BlueVoyant has done a great job sort of pivoting and figuring out how they can add value to customers and do, you know, because they they're managing not just one Splunk instance, but they're managing 100s of Splunk cloud instances. And so they've got best practices and automation that they can play across their entire client base. And I think you're going to see a lot more of that. And, and Teresa's just, Teresa is just, she loves Partners, absolutely loves Partners. And that was just obvious. You could, you could hear it in her voice. You could see it in her body language, you know, when she talked about Partnerverse. So I think you'll see us start to really get a lot more serious. Cause as big as Splunk is like our pro serve and support teams are not going to scale for the next 10,000, 100,000 Splunk customers. And we really need to like really think about how we use Partners. >> There's a real growth wave. And I, and I love the multiples wave in parallel because I think that's what everyone's consensus on. So I have to ask you as a final question, what's your takeaway? Obviously, there's been a virtual studio here where all the Splunk executives and, and, and customers and partners are here. TheCUBE's here doing all the presentations, live by the way. It was awesome. What would you say the takeaway is for this .conf, for the people watching and consuming all the content online? A lot of asynchronous consumption would be happening. >> Sure. >> What's your takeaway from this year's Splunk .conf? >> You know, I, it's hard cause you know, you get so close to it and we've rehearsed this thing so many times, you know, the feedback that I got and if you look at Twitter and you look at my Slack and everything else, like this felt like a conf that was like kind of like a really genuine, almost like a Splunk two dot O. But it's sort of true to the roots of what Splunk was true to the product reality. I mean, you know, I was really careful with my team and to avoid any whiff of vaporware, like what were, what we wanted to show was like, look, this is Splunk, we're acquiring companies, you know, 43 major releases, you know, 100s of small ones. Like we're continuing to innovate on your behalf as fast as we can. And hopefully this is the last virtual conf. But even when we go back, like there was so much good about the way we did this this week, that, you know, when we, when we broke yesterday on the keynote and we were sitting around with the crew and it kind of looking at that stage and everything, we were like, wow, there is a lot of this that we want to bring to an in-person event as well. Cause so for those that want to travel and come sit in the room with us, we're super excited to do that as soon as we can. But, but then, you know, there may be 25, 50, 100,000 that don't want to travel, but can access us via this virtual event. >> It's like a time. It's a moment in time that becomes a timeless moment. That could be, >> Wow, did you make that up right now? >> that could be an NFT. >> Yeah >> We can make a global cryptocurrency. Garth, great to see you. Of course I made it up right then. So, great to see you. >> Air bump, air bump? Okay, good. >> Okay. Garth Fort, senior vice president, Chief Product Officer. In theCUBE here, we're live on site at Splunk Studio for the .conf virtual event. I'm John Furrier. Thanks for watching. >> All right. Thank you guys. (upbeat music)

>>Welcome to the cubes coverage of VMworld 2021. I'm Lisa Martin VJ ramen. Shannon joins me next VP of product management at VMware VJ. Welcome back to the program. >>Thank you. So >>We're going to be talking about disaster recovery, VMware cloud. Dr. We've had a lot of challenges with respect to cybersecurity, but the world has in the last 18 months, I'd like to get your, your thoughts on the disaster recovery as a service, the dearest market. What are some of the key trends? Anything that you've noticed have particular interest in the last year and a half? >>Yeah, actually you're right. I mean that the last one year, since the pandemic, you know, the whole, um, lot of industries want to, uh, deploy DLR systems and want to protect themselves in France, somewhere and other, uh, other areas of the Amazon predicting that the disaster service market is going to reach about $10 billion by 2025. And so we, uh, we introduced bandwidth disaster recovery, you know, the last beam work with an acquisition of a company called atrium. And since then we've had tremendous success and it was really largely driven by two key trends that we seen in the market. One is that a lot of our customers have regulatory and mandates to do have a PR plan in place. And second is ransomware and ransomware a lot more in this interview, but ransomware is top of mind for a lot of customers. So those, these two combined together is really making a huge push to, uh, to protect all the data against, uh, disasters. >>What type of customers and any particular industries that you see that are really keenly adopting VMware cloud and D anything that you think is interesting. >>Yeah, it's actually interesting that you say it's actually not a single vertical or a size of the customer. What we have again, what we're finding is that a lot of the regulated industries, I, you know, having 92 to do the art, but the existing VR and data production systems are extremely complex and not cost effective. So, you know, customers are asked to do more with less. And so a lot of our customers, a lot of those customers are asking for, uh, looking for a cost-effective way to protect all the data. And, you know, and ransomware is not something that, that impacts, you know, any single vertical or, or any single size of customer. It impacts everyone. So we're seeing interest from all different verticals, different sizes of customers, uh, across, uh, the, you know, the B cell this, >>Yeah, you're right. The ransomware is a universal problem. And as we saw in the last few months, a problem that is really one of national public health and safety and security concerns. So you mentioned that customers from a regulatory perspective, those that need to implement Dr. Ransomware, as we talked about, are there, and then you also mentioned legacy solutions are kind of costly complex. Talk to me about some of the challenges with respect to those legacy solutions that you're helping customers to address with VMware cloud disaster recovery. >>Yeah. There are a few traits of chains that are, uh, that are emerging and then the whole data production space. One is, uh, customers want to do more with the data. And so with legacy systems, what they're finding is that customers are, you know, are able to replicate the data, but the data is sitting idle and not being used. And so, um, you know, and that's extremely, very expensive for our customers on the line. And secondly, from an outpatient standpoint, backup and Dr, as kind of merging into a single single solution and ransomware protection is becoming a critical use case as we spoke about at the talk about for that. So, uh, customers are not looking to deploy different systems for different types of production. They're looking for a similar solution that, that the lowest cost and gives them enough production across all these different use cases. >>And so where the NFL disaster recovery comes into play is that, is that we are able to use the data that we protect for other uses such as, uh, such as ransomware recovery, such as data protection, such as disaster recovery. So single copy of data that's being could be used in multiple use cases. Number one. And secondly, uh, it's a very expensive, uh, proposition to have, um, you know, on-prem to on-prem, you know, having to, you know, people who shouldn't capacity just sitting idle. And so where Vizio comes into play is that they're able to use, uh, protect the data into cloud, store it in a cost effective manner, and then just use the data when it's acquired either fatal or during disasters in ransomware. And that's where you're able to in, in, in, in the market today, >>Dig through some of those differentiators, if you will, one by one, because there's so much choice out there, there's a lot of backup solutions. Some that are providing backup only some that are doing also Dr. Depending on how customers have deployed and how they're using the technology. But when you're in customer conversations, what are the three things that you articulate about VMware cloud DVR that really help it stand out above the pack? >>Yeah, number one is the cost, right? Um, we, you know, we're able to bring down the cost of, uh, of a disaster protection, uh, by 65, by 65%. And, uh, and, you know, um, that's one big value proposition that we, uh, that we know highlight in our solution. Number two, a lot of our customers also becoming environmentally friendly and, you know, and I'm in a conscious, I should say. And so, because we're able to store the data in a more cost-effective manner, in a more efficient manner in the cloud, they're able to bring down the carbon footprint by 80% compared to regular, you know, your legacy, uh, disaster recovery and data protection solution. And the third, you know, sort of major value proposition from, from, uh, from the BMS is that, you know, we're able to integrate the, uh, uh, BCDR solution, the disaster coriander data protection solution. So well into our, um, you know, into, into the ecosystem, uh, can easily operationally easily recover data into a BM ware cloud. And so for, for the BMA ecosystem, it just becomes a natural logical extension of their, uh, their, uh, toolset. >>That's huge having a console that you're familiar with, you know, the whole point of, of backing up data and the need to recover from a disaster is to be able to restore the data in a timely fashion. I talked with a lot of customers who were using legacy technologies, and that was one of the biggest challenges backup windows weren't completing, or they simply couldn't recover data that was either, um, lost in an, in a ransomware attack or accidentally lost that recovery is what it's all about. Right. >>That's it, that's exactly right. And so at this rainbow ledger using a key enhancements and features that specifically speak to that, uh, you know, to that pain point that you just mentioned, you know, uh, we are bringing down, uh, the, uh, you know, the replication time, uh, to 30 to 30 minutes. So in other words, your Delta is, is, is, uh, is at a 300 interval now compared to all us in a traditional backup system. And number two, um, we are extending, uh, you know, be in love with a copy of it regardless it's always had with single file recovery. And so, especially for the, for the ransomware, uh, use case customers are quickly able to figure out which file leads to the restore, and they're able to restore those files individually rather than restoring their entire VM for the entire data center. And so it becomes a critical, uh, use case for, uh, critical functionality, I should say, for a ransomware recovery. And the other huge announcement of a major announcement media announcement had been made, uh, uh, others be involved is the integration into the VMware cloud in such a way that customers who move are migrating data into the BMR, the cloud on AWS can, uh, have the opportunity to, um, uh, protect the data, um, you know, uh, you know, easily BCDR and >>Got it. I'd love to get an example of a customer that you helped to recover from ransomware. As we mentioned, it's on the rise. In fact, I was looking at some cybersecurity data in the last few weeks, and it's the first half of 2021 calendar. It was up nearly 11 ax. And obviously the, the, the hockey stick lists looking like it's going to continue to go up into the right. So give me an example of a customer that you helped recover after they were hit with ransomware. >>Yeah. Yeah, I lose. And in fact, before I give you one set, one statistic that I just saw recently, um, it is, um, every Lennon are going to be across the board. There's some ransomware attack and in the world. And so, uh, you know, it is a big, you know, it is a huge, huge top of mind for a lot of, uh, the CEO's across and I, you know, across the globe now, uh, we, I just give you an example of one customer that we helped, um, you know, protect the data against ransomware. Merrick is the customer name, uh, it's a public reference. It can, um, you know, it's, it's in the BMI website and they had legacy systems, just like we talked about before they had legacy systems for protecting the data and they had, you know, backup systems and they had disaster recovery systems. >>And the big pain point was that, you know, they knew that they are, you know, they needed to protect against ransomware and, but they had two different systems backup and disaster recovery, and their cost was high because they were replicating the light data or production data, uh, you know, across different sites. And so they were looking for a, uh, to lower the cost of disaster recovery, but more importantly, they're looking to, uh, to protect themselves against potential ransomware threats and, um, and they were able to deploy VCR. And how does multiple points in time? Um, you know, I, in, in, um, in the, in the cloud that are, that allows them to go to any point, uh, you know, uh, after a ransomware attack and record from it. And as I said, the single file recovery was a huge benefit for them because they can then figure out exactly which, you know, which of those files, uh, you know, required, um, recovery. And so, um, they're able to lower the cost and protect, uh, and at the same time, uh, you know, meet the regulatory requirements and mandates to have a production in place so that the women all up there in all over the place, >>As you said, there, the data show one ransomware attack occurs every 11 seconds. And of course we only hear about the ones that make the news, right, for the most part, our customers talk about, Hey, we've had this problem. So it is no longer a, if we get hit with ransomware for every industry, like you were saying before, no industry is blind to this. It's when we get hit, we've gotta be able to recover the data. It sounds like what you're talking about from a recovery perspective is it's, it's very granular. So folks can go in and find exactly what they're looking for. Like, they don't have to restore entire VM. They can go down to the file level. >>That's exactly right. And, and you need the grant of the recovery because you want to be able to quickly restore, you know, your data, uh, and get back on, uh, you know, get back in the business. And so, uh, we provide that granular, granular recovery at the file level so that you can quickly scan your data, figure out which file needs to be at least a bit of cover and recollect just those files. Of course, you can also the color. We also provide authorization for the whole data center for the whole, uh, you know, BM and all the beings in the data center, but customers when they hit the trends and where they want to be able to quickly get back, get back into production, to those flights that, you know, that they critically need. And so that's, um, yeah, that's, it's a critical functionality. >>So is this whole entire solution in the cloud, or is there anything that the customer needs to have on premise? >>So this is, uh, all the data is go to the cloud in an efficient day, in an efficient way. Again, uh, you know, this is another sort of, um, like be that behalf, which is it's easy to just store data in the cloud in a debate, but what we do is be efficiently store the data so that, you know, you, uh, you know, you can know what the cost of your storage and, uh, uh, in the cloud. And so, you know, we used to be at BCDR, we'll be in the cloud disaster recovery. Those data in the cloud is, uh, and, and, and the data repository is in the cloud. And, uh, you can either recover data back to where you need to recover, or we allow filo or orchestrate automatically feel or of, uh, workloads into VMware on AWS, again, operational consistent, because it's a BMI software that's running on ground BMI software, that's running on data and you can, um, you know, fail a lot and bring the data onto the in-vitro Needham, VSO. It's, uh, uh, it's, uh, you know, and it's all there to look for SAS customer customer doesn't have to really manage anything on prem fuel, >>Which must've been a huge advantage in the last year and a half when it was so hard to get to the on-prem locations. Right. >>That's exactly right. And this is one of the clear differentiators, you know, against, uh, you know, with, um, uh, compared to the legacy systems, because in legacy backup and disaster recovery systems, you need to manage your, not just your target tourists, but also, you know, the Asians and, you know, all the stuff that, uh, uh, all the software that goes along with that, uh, data production and, uh, and the disaster recovery solution. And so by T and Matt upgrades and patches and so on. And so what we do with, with a SAS based approach is take away that burden away from customer. So we deliver this entire service as a SAS first as a cloud service first, um, uh, delivery mechanisms of customers are don't have water. You don't have to whatever any of those things. >>And that's critical, especially as we've seen in the last 18 months with what's been going on the challenge of getting to locations, but also what's been happening as we talked about in the cybersecurity space, on the increase, the massive increase in ransomware. Talk to me a little bit about, I want to dig in before we go about some of the ways that you've simplified and integrated the way to backup VMware cloud on AWS. Talk to me a little bit more about some of those enhancements specifically. Yeah, >>Yeah. So, um, a lot of the customers, customers, as you know, are, uh, you know, have a dual pronged approach where they have, you know, some workloads running on prem and they have some workloads running and the VMware cloud on AWS and for BNB, uh, for VMs that are running on VMware cloud on AWS. Um, you know, now they have a choice of, uh, of protecting, protecting the data and the VM very simply, uh, using the McLaurin disaster cloud disaster recovery. And what that means is that they don't need to have the full band BR solution, but they can simply protect the data and automatically restore and recover of data. If they, you know, if there's a corruption or something goes wrong with their, uh, you know, the beans, they can simply restore the data without going through an entire field processes. So we provide a simplified way for customers to automatically protect data, and then that are running on VMware cloud on AWS. And that's a, and it's fully integrated with our cloud on AWS, you know, workflows. And, um, and so that's a great win for anyone who's, who's migrating data man workloads into BMC >>Is the primary objective of that to deliver a business resiliency. Dr. >>Both actually that's, that's, that's, that's a great part about that. You know, that's a bit part of the solution is that customers don't have to choose between Dr and business resiliency. They get both with a single solution. They can start off, it's a specific business resiliency and protecting the data, but if they choose to, they can them, uh, you know, add BR as well to that, to those workflows. And so it's not either, or it's both. >>Excellent. Got it. Any other enhancements that you guys are announcing at the Emerald this year? >>Yeah. I just want to reiterate the announcements and the key enhancements and the making, making, uh, you know, the balancing beam. Well, um, the first one, as I said is, uh, uh, is 30 minutes RPO. So customers that are business critical workloads can now pro protect the data and be guaranteed that they're, you know, the, the, you know, the demo data, the data that they, um, you know, they lag behind it's, it's in the 30 minute range and not in the other screens, like with other legacy backup solutions. That's one. The second is the integration, uh, as all enhancements that, you know, that I just talked about for ransom recovery, single file, thin file restore. Um, they always had, you know, number of snapshots and, you know, failure was and so on, but silverish was a key and that's what they've been making for a ransomware recovery. And the third one is the integration with BNB coordinator. So the fully integrated solution and provides a simple, you know, sort of plug and play solution for any workload that's funding in being AWS. Those are the three Tiki announcements. There's a lot more in, um, in the world. So you'll see that in the coming weeks and months, but these are the three on to get the input, >>A lot of enhancements to a solution that was launched just about a year ago. VJ, thank you for sharing with us. What's new with VMware cloud DVR, the enhancements, what you're doing, and also how it's enabling customers to recover from that ever pressing, increasing threat of ransomware. We appreciate your thoughts and likewise for VJ Ramachandra and I'm Lisa Martin, you're watching the cubes coverage of VMworld 2021.

>>Welcome back to the cubes, continuous coverage of AWS storage day. We're in beautiful downtown Seattle in the great Northwest. My name is Dave Vellante and we're going to talk about file systems. File systems are really tricky and making those file systems elastic is even harder. They've got a long history of serving a variety of use cases as with me as Duncan Lennox. Who's the general manager of Amazon elastic file system. Dunkin. Good to see you again, Dave. Good to see you. So tell me more around the specifically, uh, Amazon's elastic file system EFS you, you know, broad file portfolio, but, but let's narrow in on that. What do we need to know? >>Yeah, well, Amazon elastic file system or EFS as we call it is our simple serverless set and forget elastic file system service. So what we mean by that is we deliver something that's extremely simple for customers to use. There's not a lot of knobs and levers. They need to turn or pull to make it work or manage it on an ongoing basis. The serverless part of it is there's absolutely no infrastructure for customers to manage. We handled that entirely for them. The elastic part then is the file system automatically grows and shrinks as they add and delete data. So they never have to provision storage or risk running out of storage and they pay only for the storage they're actually using. >>What are the sort of use cases and workloads that you see EFS supporting? >>Yeah. Yeah. It has to support a broad set of customer workloads. So it's everything from, you know, serial, highly latency, sensitive applications that customers might be running on-prem today and want to move to the AWS cloud up to massively parallel scale-out workloads that they have as well. >>So. Okay. Are there any industry patterns that you see around that? Are there other industries that sort of lean in more or is it more across the board? We >>See it across the board, although I'd have to say that we see a lot of adoption within compliance and regulated industries. And a lot of that is because of not only our simplicity, but the high levels of availability and durability that we bring to the file system as well. The data is designed for 11 nines of durability. So essentially you don't need to be worrying about your anything happening into your data. And it's a regional service meaning that your file system is available from all availability zones in a particular region for high availability. >>So as part of storage data, we, we saw some, some new tiering announcements. W w w what can you tell us about those >>Super excited to be announcing EFS intelligent tiering? And this is a capability that we're bringing to EFS that allows customers to automatically get the best of both worlds and get cost optimization for their workloads and how it works is the customer can select, uh, using our lifecycle management capability, a policy for how long they want their data to remain active in one of our active storage classes, seven days, for example, or 30 days. And what we do is we automatically monitor every access to every file they have. And if we see no access to a file for their policy period, like seven days or 30 days, we automatically and transparently move that file to one of our cost optimized, optimized storage classes. So they can save up to 92% on their storage costs. Um, one of the really cool things about intelligent tiering then is if that data ever becomes active again and their workload or their application, or their users need to access it, it's automatically moved back to a performance optimized storage class, and this is all completely transparent to their applications and users. >>So, so how, how does that work? Are you using some kind of machine intelligence to sort of monitor things and just learn over time? And like, what if I policy, what if I don't get it quite right? Or maybe I have some quarter end or maybe twice a year, you know, I need access to that. Can you, can the system help me figure >>That out? Yeah. The beauty of it is you don't need to know how your application or workload is accessing the file system or worry about those access patterns changing. So we'll take care of monitoring every access to every file and move the file either to the cost optimized storage class or back to the performance optimized class as needed by your application. >>And then optimized storage classes is again, selected by the system. I don't have to >>It that's right. It's completely transparent. So we will take care of that for you. So you'll set the policy by which you want active data to be moved to the infrequent access cost optimized storage class, like 30 or seven days. And then you can set a policy that says if that data is ever touched again, to move it back to the performance optimized storage class. So that's then all happened automatically by the service on our side. You don't need to do anything >>It's, it's it's serverless, which means what I don't have to provision any, any compute infrastructure. >>That's right. What you get is an end point, the ability to Mount your file system using NFS, or you can also manage your file system from any of our compute services in AWS. So not only directly on an instance, but also from our serverless compute models like AWS Lambda and far gays, and from our container services like ECS and EKS, and all of the infrastructure is completely managed by us. You don't see it, you don't need to worry about it. We scale it automatically for you. >>What was the catalyst for all this? I mean, you know, you got to tell me it's customers, but maybe you could give me some, some insight and add some, some color. Like, what would you decoded sort of what the customers were saying? Did you get inputs from a lot of different places, you know, and you had to put that together and shape it. Uh, tell us, uh, take us inside that sort of how you came to where you are >>Today. Well, you know, I guess at the end of the day, when you think about storage and particularly file system storage, customers always want more performance and they want lower costs. So we're constantly optimizing on both of those dimensions. How can we find a way to deliver more value and lower cost to customers, but also meet the performance needs that their workloads have. And what we found in talking to customers, particularly the customers that EFS targets, they are application administrators, their dev ops practitioners, their data scientists, they have a job they want to do. They're not typically storage specialists. They don't want to have know or learn a lot about the bowels of storage architecture, and how to optimize for what their applications need. They want to focus on solving the business problems. They're focused on whatever those are >>You meaning, for instance. So you took tiering is obvious. You're tiering to lower cost storage, serverless. I'm not provisioning, you know, servers, myself, the system I'm just paying for what I use. The elasticity is a factor. So I'm not having to over provision. And I think I'm hearing, I don't have to spend my time turning knobs. You've talked about that before, because I don't know how much time is spent, you know, tuning systems, but it's gotta be at least 15 to 20% of the storage admins time. You're eliminating that as well. Is that what you mean by sort of cost optimum? Absolutely. >>So we're, we're providing the scale of capacity of performance that customer applications need as they needed without the customer needing to know exactly how to configure the service, to get what they need. We're dealing with changing workloads and changing access patterns. And we're optimizing their storage costs. As at the same time, >>When you guys step back, you get to the whiteboard out, say, okay, what's the north star that you're working because you know, you set the north star. You don't want to keep revisiting that, right? This is we're moving in this direction. How do we get there might change, but what's your north star? Where do you see the future? >>Yeah, it's really all about delivering simple file system storage that just works. And that sounds really easy, but there's a lot of nuance and complexity behind it, but customers don't want to have to worry about how it works. They just need it to work. And we, our goal is to deliver that for a super broad cross section of applications so that customers don't need to worry about how they performance tune or how they cost optimize. We deliver that value for them. >>Yeah. So I'm going to actually follow up on that because I feel like, you know, when you listen to Werner Vogels talk, he gives takes you inside. It's a plumbing sometimes. So what is the, what is that because you're right. That it, it sounds simple, but it's not. And as I said up front file systems, getting that right is really, really challenging. So technically what's the challenges, is it doing this at scale? And, and, and, and, and, and having some, a consistent experience for customers, there's >>Always a challenge to doing what we do at scale. I mean, the elasticity is something that we provide to our customers, but ultimately we have to take their data as bits and put them into Adams at some point. So we're managing infrastructure on the backend to support that. And we also have to do that in a way that delivers something that's cost-effective for customers. So there's a balance and a natural tension there between things like elasticity and simplicity, performance, cost, availability, and durability, and getting that balance right. And being able to cover the maximum cross section of all those things. So for the widest set of workloads, we see that as our job and we're delivering value, and we're doing that >>For our customers. Then of course, it was a big part of that. And of course, when we talk about, you know, the taking away the, the need for tuning, but, but you got to get it right. I mean, you, you, you can't, you can't optimize for every single use case. Right. But you can give great granularity to allow those use cases to be supported. And that seems to be sort of the balancing act that you guys so >>Well, absolutely. It's focused on being a general purpose file system. That's going to work for a broad cross section of, of applications and workloads. >>Right. Right. And that's, that's what customers want. You know, generally speaking, you go after that, that metal Dunkin, I'll give you the last word. >>I just encourage people to come and try out EFS it's as simple as a single click in our console to create a file system and get started. So come give it a, try the >>Button Duncan. Thanks so much for coming back to the cube. It's great to see you again. Thanks, Dave. All right. And keep it right there for more great content from AWS storage day from Seattle.

>> From theCUBE Studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante. >> UiPath has had a long, strange trip to IPO. How so you ask? Well, the company was started in 2005. But it's culture, is akin to a frenetic startup. The firm shunned conventions and instead of focusing on a narrow geographic area to prove its product market fit before it started to grow, it aggressively launched international operations prior to reaching unicorn status. Well prior, when it had very little revenue, around a million dollars. Today, more than 60% of UiPath business is outside of the United States. Despite its headquarters being in New York city. There's more, according to recent SEC filings, UiPath total revenue grew 81% last year. But it's free cash flow, is actually positive, modestly. Wait, there's more. The company raised $750 million in a Series F in early February, at a whopping $35 billion valuation. Yet, the implied back of napkin valuation, based on the number of shares outstanding after the offering multiplied by the proposed maximum offering price per share yields evaluation of just under 26 billion. (Dave chuckling) And there's even more to this crazy story. Hello everyone, and welcome to this week's Wikibon CUBE Insights, Powered by ETR. In this Breaking Analysis we'll share our learnings, from sifting through hundreds of pages (paper rustling) of UiPath's red herring. So you didn't have to, we'll share our thoughts on its market, its competitive position and its outlook. Let's start with a question. Mark Roberge, is a venture capitalist. He's a managing director at Stage 2 Capital and he's also a teacher, a professor at the B-School in Harvard. One of his favorite questions that he asks his students and others, is what's the best way to grow a company? And he uses this chart to answer that question. On the vertical axis is customer retention and the horizontal axis is growth to growth rate and you can see he's got modest and awesome and so forth. Now, so I want to let you look at it for a second. What's the best path to growth? Of course you want to be in that green circle. Awesome retention of more than 90% and awesome growth but what's the best way to get there? Should you blitz scale and go for the double double, triple, triple blow it out and grow your go to market team on the horizontal axis or should be more careful and focus on nailing retention and then, and only then go for growth? What do you think? What do you think most VCs would say? What would you say? When you want to maybe run the table, capture the flag before your competitors could get there or would you want to take a more conservative approach? What would Daniel Dines say the CEO of UiPath? Again, I'll let you think about that for a second. Let's talk about UiPath. What did they do? Well, I shared at the top that the company shunned conventions and expanded internationally, very rapidly. Well before it hit escape velocity and they grew like crazy and it got out of control and he had to reign it in, plug some holes, but the growth didn't stop, go. So very clearly based on it's performance and reading through the S1, the company has great retention. It uses a metric called gross retention rate which is at 96 or 97%, very high. Says customers are sticking with it. So maybe that's the right formula go for growth and grow like crazy. Let chaos reign, then reign in the chaos as Andy Grove would say. Go fast horizontally, and you can go vertically. Let me tell you what I think Mark Roberge would say, he told me you can do that. But churn is the silent killer of SaaS companies and perhaps the better path is to nail product market fit. And then your retention metrics, before you go into hyperbolic growth mode. There's all science behind this, which may be antithetical to the way many investors want to roll the dice and go for super growth, like go fast or die. Well, it worked for UiPath you might say, right. Well, no. And this is where the story gets even more interesting and long and strange for UiPath. As we shared earlier, UiPath was founded in 2005 out of Bucharest Romania. The company actually started as a software outsourcing startup. It called the company, DeskOver and it built automation libraries and SDKs for companies like Microsoft, IBM and Google and others. It also built automation scripts and developed importantly computer vision technology which became part of its secret sauce. In December 2015, DeskOver changed its name to UiPath and became a Delaware Corp and moved its headquarters to New York City a couple of years later. So our belief is that UiPath actually took the preferred path of Mark Roberge, five ticks North, then five more East. They slow-cooked for the better part of 10 years trying to figure out what market to serve. And they spent that decade figuring out their product market fit. And then they threw gas in the fire. Pretty crazy. All right, let's take a peak (chuckling) at the takeaways from the UiPath S1 the numbers are impressive. 580 million ARR with 65% growth. That asterisk is there because like you, we thought ARR stood for annual recurring revenue. It really stands for annualized renewal run rate. annualized renewal run rate is a metric that is one of UiPath's internal KPIs and are likely communicate that publicly over time. We'll explain that further in a moment. UiPath has a very solid customer base. Nearly 8,000, I've interviewed many of them. They're extremely happy. They have very high retention. They get great penetration into the fortune 500, around 63% of the fortune 500 has UiPath. Most of UiPath business around 70% comes from existing customers. I always say you're going to get more money out of existing customers than new customers but everybody's trying to go out and get new customers. But UiPath I think is taking a really interesting approach. It's their land and expand and they didn't invent that term but I'll come back to that. It kind of reminds me of the early days of Tableau. Actually I think Tableau is an interesting example. Like UiPath, Tableau started out as pretty much a point tool and it had, but it had very passionate customers. It was solving problems. It was simplifying things. And it would have bid into a company and grow and grow. Now the market fundamentals for UiPath are very good. Automation is super hot right now. And the pandemic has created an automation mandate to date and I'll share some data there as well. UiPath is a leader. I'm going to show you the Gartner Magic Quadrant for RPA. That's kind of a good little snapshot. UiPath pegs it's TAM at 60 billion dollars based on some bottoms up calculations and some data from Bain. Pre-pandemic, we pegged it at over 30 billion and we felt that was conservative. Post-pandemic, we think the TAM is definitely higher because of that automation mandate, it's been accelerated. Now, according to the S1, UiPath is going to raise around 1.2 billion. And as we said, if that's an implied valuation that is lower than the Series F, so we suspect the Series F investors have some kind of ratchet in there. UiPath needed the cash from its Series F investors. So it took in 750 million in February and its balance sheet in the S1 shows about 474 million in cash and equivalent. So as I say, it needed that cash. UiPath has had significant expense reductions that we'll show you in some detail. And it's brought in some fresh talent to provide some adult supervision around 70% of its executive leadership team and outside directors came to the company after 2019 and the company's S1, it disclosed that it's independent accounting firm identified last year what it called the "material weakness in our internal controls over financial report relating to revenue recognition for the fiscal year ending 2018, caused by a lack of oversight and technical competence within the finance department". Now the company outlined the steps it took to remediate the problem, including hiring new talent. However, we said that last year, we felt UiPath wasn't quite ready to go public. So it really had to get its act together. It was not as we said at the time, the well-oiled machine, that we said was Snowflake under Mike Scarpelli's firm operating guidance. The guy's the operational guru, but we suspect the company wants to take advantage of this mock market. It's a good time to go public. It needs the cash to bolster its balance sheet. And the public offering is going to give it cache in a stronger competitive posture relative to its main new competitor, autumn newbie competitor Automation Anywhere and the big whales like Microsoft and others that aspire and are watching what UiPath is doing and saying, hey we want a piece of that action. Now, one other note, UiPath's CEO Daniel Dines owns 100% of the class B shares of the company and has a 35 to one voting power. So he controls the company, subject of course to his fiduciary responsibilities but if UiPath, let's say it gets in trouble financially, he has more latitude to do secondary offerings. And at the same time, it's insulated from activist shareholders taking over his company. So lots of detail in the S1 and we just wanted to give you some of those highlights. Here are the pretty graphs. If whoever wrote this F1 was a genius. It's just beautiful. As we said, ARR, annualized renewal run rate all it does is it annualizes the invoice amount from subscriptions in the maintenance portion of the revenue. In other words, the parts that are recurring revenue, it excludes revenue from support and perpetual license. Like one-time licenses and services is just kind of the UiPath's and maybe that's some sort of legacy there. It's future is that recurring revenue. So it's pretty similar to what we think of as ARR, but it's not exact. Lots of customers with a growing number of six and seven figure accounts and a dollar-based net retention of 145%. This figure represents the rate of net expansion of the UiPath ARR, from existing listing customers over a 12 month period. Translation. This says UiPath's existing customers are spending more with the company, land and expand and we'll share some data from ETR on that. And as you can see, the growth of 86% CAGR over the past nine quarters, very impressive. Let's talk about some of the fundamentals of UiPath's business. Here's some data from the Brookings Institute and the OECD that shows productivity statistics for the US. The smaller charts in the right are for Germany and Japan. And I've shared some similar data before the US showed in the middle there. Showed productivity improvements with the personal productivity boom in the mid to late 90s. And it spilled into the early 2000s. But since then you can see it's dropped off quite significantly. Germany and Japan are also under pressure as are most developed countries. China's labor productivity might show declines but it's level, is at level significantly higher than these countries, April 16th headline of the Wall Street Journal says that China's GDP grew 18% this quarter. So, we've talked about the snapback in post-COVID and the post-isolation economy, but these are kind of one time bounces. But anyway, the point is we're reaching the limits of what humans can do alone to solve some of the world's most pressing challenges. And automation is one key to shifting labor away from these more mundane tasks toward more productive and more important activities that can deliver lasting benefits. This according to UiPath, is its stated purpose to accelerate human achievement, big. And the market is ready to be automated, for the most part. Now the post-isolation economy is increasingly going to focus on automation to drive toward activity as we've discussed extensively, I got to share the RPA Magic Quadrant where nearly everyone's a winner, many people are of course happy. Many companies are happy, just to get into the Magic Quadrant. You can't just, you have to have certain criteria. So that's good. That's what I mean by everybody wins. We've reported extensively on UiPath and Automation Anywhere. Yeah, we think we might shuffle the deck a little bit on this picture. Maybe creating more separation between UiPath and Automation Anywhere and the rest. And from our advantage point, UiPath's IPO is going to either force Automation Anywhere to respond. And I don't know what its numbers are. I don't know if it's ready. I suspect it's not, we'd see that already but I bet you it's trying to get there. Or if they don't, UiPath is going to extend its lead even further, that would be our prediction. Now personally, I would have Pegasystems higher on the vertical. Of course they're not an IPO, RPA specialist, so I kind of get what Gartner is doing there but I think they're executing well. And I'd probably, in a broader context I'd probably maybe drop blue prism down a little bit, even though last year was a pretty good year for the company. And I would definitely have Microsoft looming larger up in the upper left as a challenger more than a visionary in my opinion, but look, Gartner does good work and its analysts are very deep into this stuff, deeper than I am. So I don't want to discount that. It's just how I see it. Let's bring in the ETR data and show some of the backup here. This is a candlestick chart that shows the components of net score, which is spending momentum, however, ETR goes out every quarter. Says you're spending more, you're spending less. They subtract the lesses from the mores and that's net score. It's more complicated than that, but that's that blue line that you see in the top and yes it's trending downward but it's still highly elevated. We'll talk about that. The market share is in the yellow line at the bottom there. That green represents the percentage of customers that are spending more and the reds are spending less or replacing. That gray is flat. And again, even though UiPath's net score is declining, it's that 61%, that's a very elevated score. Anything over 40% in our view is impressive. So it's, UiPath's been holding in the 60s and 70s percents over the past several years. That's very good. Now that yellow line market share, yes it dips a bit, but again it's nuanced. And this is because Microsoft is so pervasive in the data stat. It's got so many mentions that it tends to somewhat overwhelm and skew these curves. So let's break down net score a little bit. Here's another way to look at this data. This is a wheel chart we show this often it shows the components of net score and what's happening here is that bright red is defection. So look at it, it's very small that wouldn't be churn. It's tiny. Remember that it's churn is the killer for software companies. And so that forest green is existing customers spending more at 49%, that's big. That lime green is new customers. So again, it's from the S1, 70% of UiPath's revenue comes from existing customers. And this really kind of underscores that. Now here's more evidence in the ETR data in terms of land and expand. This is a snapshot from the January survey and it lines up UiPath next to its competitors. And it cuts the data just on those companies that are increasing spending. It's so that forest green that we saw earlier. So what we saw in Q1 was the pace of new customer acquisition for UiPath was decelerating from previous highs. But UiPath, it shows here is outpacing its competition in terms of increasing spend from existing customers. So we think that's really important. UiPath gets very high scores in terms of customer satisfaction. There's, I've talked to many in theCUBE. There's places on the web where we have customer ratings. And so you want to check that out, but it'll confirm that the churn is low, satisfaction is high. Yeah, they get dinged sometimes on pricing. They get dinged sometimes, lately on service cause they're growing so fast. So, maybe they've taken the eye off the ball in a couple of counts, but generally speaking clients are leaning in, they're investing heavily. They're creating centers of excellence around RPA and automation, and UiPath is very focused on that. Again, land and expand. Now here's further evidence that UiPath has a strong account presence, even in accounts where its competitors are presence. In the 149 shared accounts from the Q1 survey where UiPath, Automation Anywhere and Microsoft have a presence, UiPath's net score or spending velocity is not only highly elevated, it's relative momentum, is accelerating compared to last year. So there's some really good news in the numbers but some other things stood out in the S1 that are concerning or at least worth paying attention to. So we want to talk about that. Here is the income statement and look at the growth. The company was doing like 1 million dollars in 2015 like I said before. And when it started to expand internationally it surpassed 600 million last year. It's insane growth. And look at the gross profit. Gross margin is almost 90% because revenue grew so rapidly. And last year, its cost went down in some areas like its services, less travel was part of that. Now jump down to the net loss line. And normally you would expect a company growing at this rate to show a loss. The street wants growth and UiPath is losing money, but it's net loss went from 519 million, half a billion down to only 92 million. And that's because the operating expenses went way down. Now, again, typically a company growing at this rate would show corresponding increases in sales and marketing expense, R&D and even G&A but all three declined in the past 12 months. Now reading the notes, there was definitely some meaningful savings from no travel and canceled events. UiPath has great events around the world. In fact theCUBE, Knock Wood is going to be at its event in October, in Las Vegas at the Bellagio . So we're stoked for that. But, to drop expenses that precipitously with such high growth, is kind of strange. Go look at Snowflake's income statement. They're in hyper-growth as well. We like to compare it to Snowflake is a very well-run company and it's in hyper-growth mode, but it's sales and marketing and R&D and G&A expense lines. They're all growing along with that revenue. Now, perhaps they're growing at a slower rate. Perhaps the percent of revenue is declining as it should as they achieve operating leverage but they're not shrinking in absolute dollar terms as shown in the UiPath S1. So either UiPath has applied some magic automation mojo to it's business (chuckling). Like magic beans or magic grits with my cousin Vinny. Maybe it has found the Holy grail of operating leverage. It's a company that's all about automation or the company was running way too hot on the expense side and had a cut and clean up its income statement for the IPO and conserve some cash. Our guess is the latter but maybe there's a combination there. We'll give him the benefit of the doubt. And just to add a bit more to this long, strange trip. When have you seen an explosive growth company just about to go public, show positive cashflow? Maybe it's happened, but it's rare in the tech and software business these days. Again, go look at companies like Snowflake. They're not showing positive cashflow, not yet anyway. They're growing and trying to run the table. So you have to ask why is UiPath operating this way? And we think it's because they were so hot and burning cash that they had to reel things in a little bit and get ready to IPO. It's going to be really interesting to see how this stock reacts when it does IPO. So here's some things that we want you to pay attention to. We have to ask. Is this IPO, is it window dressing? Or did UiPath again uncover some new productivity and operating leverage model. I doubt there's anything radically new here. This company doesn't want to miss the window. So I think it said, okay, let's do this. Let's get ready for IPO. We got to cut expenses. It had a lot of good advisors. It surrounded itself with a new board. Extended that board, new management, and really want to take advantage of this because it needs the cash. In addition, it really does want to maintain its lead. It's got Automation Anywhere competing with it. It's got Microsoft looming large. And so it wants to continue to lead. It's made some really interesting acquisitions. It's got very strong vision as you saw in the Gartner Magic Quadrant and obviously it's executing well but it's really had to tighten things up. So we think it's used the IPO as a fortune forcing function to really get its house in order. Now, will the automation mandate sustain? We think it will. The forced match to digital worked, it was effective. It wasn't pleasant, but even in a downturn we think it will confer advantage to automation players and particularly companies like UiPath that have simplified automation in a big way and have done a great job of putting in training, great freemium model and has a culture that is really committed to the future of humankind. It sounds ambitious and crazy but talk to these people, you'll see it's true. Pricing, UiPath had to dramatically expand or did dramatically expand its portfolio and had to reprice everything. And I'm not so worried about that. I think it'll figure that pricing out for that portfolio expansion. My bigger concern is for SaaS companies in general. I don't like SaaS pricing that has been popularized by Workday and ServiceNow, and Salesforce and DocuSign and all these companies that essentially lock you in for a year or two and basically charge you upfront. It's really is a one-way street. You can't dial down. You can only dial up. It's not true Cloud pricing. You look at companies like Stripe and Datadog and Snowflake. It is true Cloud pricing. It's consumption pricing. I think the traditional SaaS pricing model is flawed. It's very unfairly weighted toward the vendors and I think it's going to change. Now, the reason we put cloud on the chart is because we think Cloud pricing is the right way to price. Let people dial up and dial down, let them cancel anytime and compete on the basis of your product excellence. And yeah, give them a price concession if they do lock in. But the starting point we think should be that flexibility, pay by the drink. Cancel anytime. I mentioned some companies that are doing that as well. If you look at the modern SaaS startups and the forward-thinking VCs they're really pushing their startups to this model. So we think over time that the term lock-in model is going to give way to true consumption-based pricing and at the clients option, allow them to lock-in for a better price, way better model. And UiPath's Cloud revenue today is minimal but over time, we think it's going to continue to grow that cloud. And we think it will force a rethink in pricing and in revenue recognition. So watch for that. How is the street going to react to Daniel Dines having basically full control of the company? Generally, we feel that that solid execution if UiPath can execute is going to outweigh those concerns. In fact, I'm very confident that it will. We'll see, I kind of like what the CEO says has enough mojo to say (chuckling) you know what, I'm not going to let what happened to for instance, EMC happen to me. You saw Michael Dell do that. You saw just this week they're spinning out VMware, he's maintaining his control. VMware Dell shareholders get get 40.44 shares for every Dell share they're holding. And who's the biggest shareholder? Michael Dell. So he's, you got two companies, one chairman. He's controlling the table. Michael Dell beat the great Icahn. Who beats Carl Icahn? Well, Michael Dell beats Carl Icahn. So Daniel Dines has looked at that and says, you know what? I'm not just going to give up my company. And the reason I like that with an if, is that we think will allow the company to focus more on the long-term. The if is, it's got to execute otherwise it's so much pressure and look, the bottom line is that UiPath has really favorable market momentum and fundamentals. But it is signing up for the 90 day short clock. The fact that the CEO has control again means they can look more long term and invest accordingly. Oftentimes that's easier said than done. It does come down to execution. So it is going to be fun to watch (chuckling). That's it for now, thanks to the community for your comments and insights and really always appreciate your feedback. Remember, I publish each week on Wikibon.com and siliconangle.com and these episodes are all available as podcasts. All you got to do is search for the Breaking Analysis podcast. You can always connect with me on Twitter @dvellante or email me at david.vellante@siliconangle.com or comment on my LinkedIn posts. And we'll see you in clubhouse. Follow me and get notified when we start a room, which we've been doing with John Furrier and Sarbjeet Johal and others. And we love to riff on these topics and don't forget, please check out etr.plus for all the survey action. This is Dave Vellante, for theCUBE Insights Powered by ETR. Be well everybody. And we'll see you next time. (gentle upbeat music)

>>Yeah. Okay. Now we're going to dig deeper into HP es moral and try to better understand how it's going to impact customers. And with me to do that are Robert Christensen is the vice president strategy in the office of the C, T. O. And Kumar Srikanth is the chief technology officer and head of software both, of course, with Hewlett Packard Enterprise. Gentlemen, welcome to the program. Thanks for coming on. >>Good seeing you. Thanks for having us. >>Always. Great. Great to see you guys. So, Esmeralda, kind of a interesting name. Catchy name. But tomorrow, what exactly is H P E s bureau? >>Yeah. It's indeed a catchy name. Our branding team done a fantastic job. I believe it's actually a derivation from Esmeralda. The Spanish for Emerald Berlin. Supposed to have some very mystical powers. Um, and they derived as moral from there, and we all actually, initially that we heard it was interesting. Um, so as well was our effort to take all the software, the platform tools that HB has and provide these modern operating platform to the customers and put it under one brand. It has a modern container platform. It has a persistent stories distribute the date of February. It has been foresight, as many of our customers similar, So it's the think of it as a container platform offering for modernization of the civilization of the customers. >>Yeah, it's an interesting to talk about platform, so it's not a lot of times people think product, but you're positioning it as a platform, so it has a broader implications. >>That's very true. So as the customers are thinking of this civilization, modernization containers and microservices, as you know there has become, has become the stable whole. So it's actually a container orchestration platform. It offers open source proven. It is as well as the persistence always bolted to >>so by the way, s moral, I think emerald in Spain, I think in the culture it also has immunity powers as well. So immunity >>from >>lock in and all those other terrible diseases. Maybe it helps us with covid to rob Robert. When you talk to customers, what problems do you probe for that that is immoral. Can can do a good job solving. >>Yeah, they That's a really great question because a lot of times they don't even know what it is that they're trying to solve for, other than just a very narrow use case. But the idea here is to give them a platform by which they can bridge both the public and private environment for what to do an application development specifically in the data side. So when they're looking to bring Container Ization, which originally got started on the public cloud and has moved its way, I should say, become popular in the public cloud and has moved its way on premises. Now Esmeralda really opens the door to three fundamental things. But how do I maintain an open architecture like you're referring to some low or oh, no lock in of my applications And there were two. How do I gain a data fabric or data consistency of accessing the data so I don't have to rewrite those applications when I do move them around and then, lastly, where everybody is heading down, the real value is in the AI ML initiatives that companies are are really bringing that value of their data and locking the data at where the data is being generated and stored. And so the is moral platform is those multiple pieces that I was talking about stacked together to deliver those solutions for the client. >>So come on, what's the How does it work? What's the sort of I p or the secret sauce behind it all? What makes HP different? >>Continuing our team of medical force around, uh, it's a moral platform for optimizing the data Indians who were close. I think I would say there are three unique characteristics of this platform. Number one is actually provides you both an ability to run stable and stateless were close under the same platform, and number two is as we were thinking about. Unlike analogues, covenant is open source. It actually produce you all open source government as well as an orchestration behind you. So you can actually you can provide this hybrid, um, thing that drivers was talking about. And then actually we built the work flows into it. For example, we're actually announced along with Esmeralda MLS, but on their customers can actually do the work flow management. Our own specifically did the work force. So the magic is if you want to see the secrets of is all the efforts that have been gone into some of the I p acquisitions that HBs the more years we should be. Blue Data bar in the nimble emphasize, all these pieces are coming together and providing a modern digitalization platform for the customers. >>So these pieces, they all have a little bit of a machine intelligence in them. Yeah, People used to think of a I as the sort of separate thing, having the same thing with containers, right? But now it's getting embedded in into the stack. What? What is the role of machine intelligence or machine learning in Edinburgh? >>I would take a step back and say, You know this very well. They're the customer's data amount of data that is being generated, and 95% or 98% of data is machine generated, and it has a serious amount of gravity, and it is sitting at the edge, and we were the only the only one that edge to the cloud data fabric that's built. So the number one is that we are bringing computer or a cloud to the data. They're taking the data to the cloud like if you go, it's a cloud like experience that provides the customer. Yeah, is not much value to us if we don't harness the data. So I said this in one of the blood. Of course, we have gone from collecting the data era to the finding insights into the data so that people have used all sorts of analysis that we are to find data is the new oil to the air and the data. And then now you're applications have to be modernized. And nobody wants to write an obligation in a non microservices fashion because you want to build the modernization. So if you bring these three things, I want to have a data. Gravity have lots of data. I had to build an area applications and I want to have an idea those three things I think we bring together to the customs. >>So, Robert, let's stay on customers from it. I mean, you know, I want to understand the business impact, the business case. I mean, why should all the you know, the cloud developers have all the fun? You mentioned that you're bridging the cloud and on Prem, uh, they talk about when you talk to customers and what they are seeing is the business impact. What's the real drivers for them. >>That's a great question because at the end of the day I think the reason survey that was that cost and performance is still the number one requirement for the real close. Second is agility, the speed of which they want to move. And so those two are the top of mind every time. But the thing we find in as moral, which is so impactful, is that nobody brings together the silicon, the hardware, the platform and all that stacked together work and combined, like as moral does with the platforms that we have and specifically, you know, when we start getting 90 92 93% utilization out of ai ml workloads on very expensive hardware, it really, really is a competitive advantage over a public cloud offering which does not offer those kind of services. And the cost models are so significantly different. So we do that by collapsing the stack. We take out as much intellectual property, give me, um, as much software pieces that are necessary. So we are closest to the silicon closest to the applications bring into the hardware itself, meaning that we can inter leave the applications, meaning that you can get to true multi tendency on a particular platform that allows you to deliver a cost optimized solution. So when you talk about the money side, absolutely. There's just nothing out there and then on the second side, which is agility. Um, one of the things that we know is today is that applications need to be built in pipelines. Right? This is something that has been established now for quite some time now. That's really making its way on premises. And what Kumar was talking about was, how do we modernize? How do we do that? Well, there's going to be something that you want to break into Microservices and containers. There's something you don't now the ones that they're going to do that they're gonna get that speed and motion etcetera out of the gate. And they can put that on premises, which is relatively new these days to the on premises world. So we think both will be the advantage. >>Okay, I want to unpack that a little bit. So the cost is clearly really 90 plus percent utilization. I mean, come on. You know, even even a pre virtualization. We know what it was like even with virtualization, you never really got that high. I mean, people would talk about it, but are you really able to sustain that in real world workloads? >>Yeah, I think when you I think when you when you make your exchangeable currency into small pieces, you can insert them into many areas. And we have one customer was running 18 containers on a single server and each of those containers, as you know, early days of data. You actually modernized what we consider we won containers of micro B. Um, so if you actually build these microservices and you have all anti affinity rules and you have rationing formulas all correctly, you can pack being part of these things extremely violent. We have seen this again. It's not a guarantee. It all depends on your application and your I mean, as an engineer, we want to always understand how this can be that sport. But it is a very modern utilization of the platform with the data and once you know where the data is, and then it becomes very easy to match those >>now. The other piece of the value proposition that I heard Robert is it's basically an integrated stack, so I don't have to cobble together a bunch of open source components. It's there. There's legal implications. There's obviously performance implications that I would imagine that resonates is particularly with the enterprise buyer, because they have the time to do all this integration. >>That's a very good point. So there is an interesting, uh, interesting question that enterprise they want to have an open source, so there is no lock in. But they also need help to implement and deploy and manage it because they don't have expertise. And we all know that Katie has actually brought that AP the past layer standardization. So what we have done is we've given the open source and you write to the covenant is happy, but at the same time orchestration, persistent stories, the data fabric, the ai algorithms, all of them are bolted into it. And on the top of that, it's available both as a licensed software and run on Prem. And the same software runs on the Green Lake so you can actually pay as you go and you don't we run it for them in in a collar or or in their own data center. >>Oh, good. I was one of my latter questions, so I can get this as a service paid by the drink. Essentially, I don't have to install a bunch of stuff on Prem and pay >>a perpetual license container at the service and the service in the last Discover. And now it's gone production. So both MLRS is available. You can run it on friends on the top of Admiral Container platform or you can run inside of the Green Bay. >>Robert, are there any specific use case patterns that you see emerging amongst customers? >>Yeah, absolutely. So there's a couple of them. So we have a really nice relationship that we see with any of the Splunk operators that were out there today. Right? So Splunk containerized their operator. That operator is the number one operator, for example, for Splunk, um, in the i t operation side or notifications as well as on the security operation side. So we found that that runs highly effective on top of his moral on top of our platforms that we just talked about what, uh, Kumar just talked about, but I want to also give a little bit of backgrounds to that same operator platform. The way that the Admiral platform has done is that we've been able to make highly active, active with a check availability at 95 nines for that same spark operator on premises on the kubernetes open source, which is, as far as I'm concerned. Very, very high end computer science work. You understand how difficult that is? Uh, that's number one. Number two, you'll see spark just a spark. Workloads as a whole. All right. Nobody handles spark workloads like we do. So we put a container around them, and we put them inside the pipeline of moving people through that basic, uh uh, ml ai pipeline of getting a model through its system through its train and then actually deployed to our MLS pipeline. This is a key fundamental for delivering value in the data space as well. And then, lastly, this is This is really important. When you think about the data fabric that we offer, um, the data fabric itself, it doesn't necessarily have to be bolted with the container platform to container at the actual data. Fabric itself can be deployed underneath a number of our for competitive platforms who don't handle data. Well, we know that we know that they don't handle it very well at all. And we get lots and lots of calls for people say, Hey, can you take your as Merrill data for every and solve my large scale, highly challenging data problems, we say yes. And then when you're ready for a real world full time but enterprise already, container platform would be happy to privilege. >>So you're saying if I'm inferring correctly, you're one of the values? Is your simplifying that whole data pipeline and the whole data science science project? Unintended, I guess. >>Okay, >>that's so so >>absolutely So where does the customer start? I mean, what what are the engagements like? Um, what's the starting point? >>It's being is probably one of the most trusted enterprise supplier for many, many years, and we have a phenomenal workforce of the both. The PowerPoint next is one of the leading world leading support organization. There are many places to start with. The right one is Obviously all these services are available on the green leg as we just start apart and they can start on a pay as you go basis. We have many customers that. Actually, some of the grandfather from the early days of pleaded and map are and they're already running, and they actually improvised on when, as they move into their next generation modernization, um, you can start with simple as metal container platform with persist with the story compared to this operation and can implement as as little as $10 and to start working. Um, and finally, there is a a big company like HP E. As an enterprise company defined next services. It's very easy for the customers to be able to get that support on the day to operation. >>Thank you for watching everybody's day volonte for the Cube. Keep it right there for more great content from Esmeralda. >>A mhm, okay.

>>Yeah, yeah. >>Hello and welcome back. You're just in time for our third session spot. I Q amplify your insights with AI in this session will explore how AI gets you to the why of your data capturing changes and trends in the moment they happen. >>You'll >>start to understand how you can transform your data culture by making it easier for analysts to enable business users to consume insights in real time. >>You >>might think this all sounds too good to be true. Well, since seeing is believing, we're joined by thought spots. Vika Scrotum, senior product manager. Anak Shaped Mirror, principal product manager to walk you through all of this on MAWR. Over to you actually, >>Thank you. Wanna Hello, everyone. Welcome to the session. I am Action Hera, together with my colleague because today we will talk to you about how spot I Q uses a. I to generate meaningful insights for the users Before we dwell into that. Let's see why this is becoming so important. Your business and your data is growing and moving faster than ever. Data is considered the new oil Howard. Only those will benefit who can extract value of it. The data used in most of your organization's is just the tip of the iceberg beneath the tip of the iceberg. What you don't see or what you don't know to ask. That makes the difference in this data driven world. Let's learn how one can extract maximum value of the data to make smarter business decisions. We believe that analytics should require less input while producing more output with higher quality in a traditional approach. To be honest, users generally depend on somebody else to create data models, complex data queries to get answers to their pre anticipated questions. But solution like hot spot business users already have a Google like experience where they can just go and get answers to their questions. Now, if you look at other consumer applications, there are multiple of recommendation engines which are out there, which keep recommending. Which article should I read next? Which product should I buy? Which movie should I watch in a way, helping me optimized? Where should I focus my time on in a Similarly in analytics, as your data is growing, solutions must help users uncovered insights to questions which they may not ask, we believe, and a I automated insights will help users unleash the full potential off their data Across the spectrum, we see a potential in a smart, AI driven solution toe autonomously. Monitor your data and feed in relevant insights when you need them, much like a self driving car navigates our users safely to their desired destination. With this, yeah, I'm happy to introduce you to spot like you are a driven insights engine at scale, which will help you get full potential off your data like you automatically discovers, personalize and drive insights hidden in your data. So whenever you search to create answers, spot that you continues to ask a lot more questions on your behalf as it keeps drilling and related date dimensions and measures employed insights which may be of interest to you. Now you as a user can continue to ask your questions or can dig deeper into the inside, provided by spotted you Spartak. You also provides a comprehensive set of insights, which helps user get answers to their advance business questions. In a few clicks, so spotted it. You can help you detect any outlier, for example, spot that you can not only tell you which seller has the highest returns than others, but also which product that sellers selling has higher returns than other products. Or, like you can quickly detect any trends in your data and help us answer questions like how my account sign ups are trending after my targeted campaign is over. I can quickly use for, like, toe get unanswered how my open pipeline is related to my bookings amount and what's the like there. What it means is that how much time a lead will take to convert into a deal I can use partake. You, too, create multiple clusters off my all my customer base and then get answers to questions that which customer segment is buying which particular brand and what are the attributes last and the most used feature Key drivers of change spotted you helps you get answer to a question. What factors lead to the change in sales off a store in 2020 as compared to 2019? We can do all this and simple fix. That's barbecue. What is so unique about Spartak? You how it works hand in hand with our search experience, the more you search, the smarter. The spot that you get as it keeps learning from your usage behavior on generates relevant insights for you for your users. Spartak. You ensures that users can trust every insights. A generator. It broadly does this and broadly, two ways. It keeps their insights relevant by learning the underlying data model on. By incorporating the users feedback that is, users can provide feedback to the spot I Q similar to any social media back from, they can like watching sites they find useful on dislike. What insights Do not find it useful based on users. Feedback Spot like you can downgrade any insight if the users have not find it useful. In addition to that, users can dig deep into any Spartak you insight on all calculations behind it are available for a user to look and understand. The transparency in these calculations not only increases the analytical trust among the users, but also help them learn how they can use the search bar to do much more. I'm super excited to announce Partake you is now available on embrace so our automated A insights engine can run queries life and in database on these datasets so you do not need to bring your data to thoughts about as you connect your data sources. Touch Part performs full indexing value to the data you have selected, not just the headers in the material and as you run sport in Q, it optimizes and run efficient queries on your data warehouse on. I am super pleased to introduce you. This new spot like you monitor the spot that you monitor will enable all your users to keep track of their key metrics. Spartak, you monitor will not only provide them regular updates off their key metrics, but we also analyze all the underlying data on related dimensions to help them explain. What is leading to the change of a particular metric monitor will also be available on your mobile app so that you can keep track of your metrics whenever and wherever you go, because will talk for further detail about this during the demo. So now let's see Spartak in action. But before we go there, let's meet any. Amy is an analyst at a global retail about form. Amy is preparing for her quarterly sales review meeting with the management, so Amy has to report how the sales has meat performing how, what, what factors lead to the change in the sales? And if there are any other impressing insights, which everyone should off tell to the management? So but this Let's see how immigrant use part like you to prepare for the meeting. So Amy goes to that spot, chooses the sales data set for her company. But before we see how many users what I Q to prepare for the meeting. I just wanted to highlight that all this data which we're going to talk about is residing in Snowflake. >>So >>Touch Part is going to do a life query on the snowflake database on even spot. A Q analysis will run on the Snowflake databases, so we'll go back and see how you can use it. So Amy is preparing for the sales meeting for 2019. We just ended. So images right Sales 2019 on here. She has the graph of the Continent tickets, >>so >>what she does is immediately pence it >>for >>the report. She's creating Andi now. This graph is available >>there now. >>Any Monnet observed >>that >>the Q four sales is significantly higher than Q >>three, so >>you she wants to deep dive into this. So she just select these two data points and does the right click and runs particularities. So now, as we talked earlier, Spartak, you recommends which columns Spartak Things Will best explains this change >>on. >>Not only that, you can look that Spartacus automatically understood that Amy is trying toe identify what led to this change. So the change analysis we selected So now with this, >>Amy >>has a bit more business context when he realizes that she doesn't want to add these columns. So she's been using because she thinks this is too granular for the management right now. >>If >>she wants, she can add even more columns. All columns are available for her, and she can reduce columns. So now she runs 42 analysis. So while this product Unisys is running, what the system will do with the background, this part I Q will drill across all the dimensions, which any is selected and try to explain the difference, which is approximately $10 million in sales. So let's see if Amy's report is ready. Yeah, so with this, what's product you has done is protect you has drilled across all dimensions. Amy has selected and presented how the different values in these dimensions have changed. So it's product. You will not only tell you which values in these dimensions have changed the most, but also does an attribution that how much of this change has led to the overall change scenes. So here in the first inside sport accuse telling that 10 products have the largest change out of the 3 45 values and the account for 39% increase. Overall, there has been look by the prototype category. It's saying that five product types of the largest change out of the 15 values, and they account for 98.6% of total increase. And they're not saying the sailors increased their also demonstrating that in some categories the sales has actually decreased to ensure the sales has decreased. Amy finds this inside should be super useful so immediately pins this on the same pain, but she was preparing for and she's getting ready with that. Amy also wants to dig deeper into this inside. My name goes here. She sees that spot. I Q has not only calculated the change across these product types, but has also calculated person did change. So Amy immediately sorts this by wasn't did change. And then she notices that even though Sweater as a category as a prototype, was not appearing in the change analysis but has the most significant change in terms of percentage in comparison to Q two vs Q four. So she also wants to do this so she can just quickly change the title. And she can pin this insight as well under spin board for the management to look at with this done. Now, Amy, just want to go back to this sales and see if she can find anything else interesting. So now Amy has already figured out the possible causes. What led to the increase in sales? So now, for the whole of 2019, as this is also your closing, Amy looks, uh, the monthly figures for 2019, and she gets this craft now. If Amy has to understand, if there is an interesting insight, she can dig into different dimensions and figure out on her own or immigrant, just click on this product analysis. That's product immediately suggest all the dimensions and measures immigrant analyze sales by Andi many. We will run this What will happen is this barbecue system will try to identify outliers. The different trend analysis Onda cross correlation across different measures. So Amy again realizes that this is a bit too much for her. So she reduces some of these insights, which she thinks are not required for the management right now from the business context and the business meeting. And then she just immediately runs this analysis. So now, with this, Amy is hoping to get some interesting insights from Spartak, which immigrant present to her management meeting. Let's see what sport gets for her. So now the Alice is run within 10 seconds, so spot taken started analyzing. So these are the six anomaly sport like you found across different products, where their total sales are higher than the rest. He also founded Spot. I just found eight insights off different product types which has tired total sales and look across these enemy sees that oh jackets have against the highest sales across all the categories in December as well. Amy wants toe been this to the PIN board on M. It moves further now. Amy's is that it has also shown Total Country purchased their product a me thinks this is not a useful insights. Amy can get this feedback. The system and system asked, Why are you saying you don't find this useful so the system can remember? So you can also say that anomalies are obvious right now and give this feedback and the system will remember. In addition, Amy finds that the system has automatically correlated the total sales in total contrary purchase. Amy Pence this as well to the pin board. Andi. She loves this inside where she she is that not only the total sales have increased, but total quantity purchases have increased a lot more on their training, opposed as well. So she also opens this now anything. She is ready for her meeting with the management. So she just goes and shares the PIN board, which she just created with the management. And you know what happens immediately? The jacket sales category Manager Mr Tom replies back to Amy and says in the request, Any d really like this? So now we will see how Spartak you can help any educators as request doesn't mean really need to create these kind of reports every month to cater toe Tom's request. So with this, I will handle it because to take us walk us through How spot that you can cater this request. Hi, >>everyone. So analysts like Amy are always flooded with such requests from the business users and with Spot and you monitor. Amy can set up everyone who needs updates on a on a metric in just a few simple steps and enable them to drag these metrics whenever and wherever they want. And north of the metrics, they also get the corresponding change analysis on the device off their choice with hot Spot. What I give money being available on both Web and the mobile labs. So let's get started with the demo will be set up a meet and go to the search tab and creator times we start for the metrics you want to monitor, right? And please know if the charges already created is already created. All is available is, um, usually a section in a PIN board. Also dancer. Then there's no need to create a new child. She can simply then uh, right click on the chart and select moisture from the menu, which then shows, which then shows the breakdown off the metric he's going to monitor, including the measure. What it's been grouped by on what it is filtered on. Okay, and also as this is a weekly metric, all the subscribers are going to get a weekly notification for this metric had been a monthly metric. Then the notifications would have been delivered on a monthly cadence. Next she can click on, continue and go to the configure dimensions called on Page. Here A is recommending what all dimensions could best being the change in this metric, she can go ahead with default recommendation, or she can change the columns as she seems very she can click, she conflict, continue and go to the next page, which is the subscriber stage. It is added by default to the subscriber, but she can search everyone who needs update on this metric and add them on this metric by clicking confirmed, she'll see a toast message on the bottom of the page, taking on which will take a me to this page, which is a metric detail page On the top of this page, we can see the movement of the metric and how it is changing over time, 92 you can see that the Mets jacket, since number has increased by 2.5% in the week off 23rd of December has compared toa the week off 16th of December and just below e a has invaded the man is generated in sites which are readily available for consumption. Okay to discharge. Right here says that pain products have the largest change out of all the 28 values and contributes to the 88% of the total increase in the same. And this one right here is that Midwest is the larger Midwest has the largest change and accounts for 55.66% off the total increase. Now, all this goodness is also available on the mobile lab. Right? So let me just show you how business users are going to get notified on the based. On this metric, all the business users who are subscribed to this metric are going to get a regular email as well as push notifications on the mobile lab. And when the click on this, they line on a metric detail page which has all the starts, which I just showed you on the on the bed version, okay. And one cyclic on back burden. They land on this page, which is a monitor tab, and it summarizes all the metrics Which opportunity monitoring and gives them a whole gave you to stay all I want to stay on top of their businesses. Okay. Eso that folks was monitor. Now I'll search back to slaves and cover. Summarize the key takeaways. From what? That she and I just don't know. So it's part of you wanted, uh, Summit Spartak you. It automatically discovers insights and helps you unless the full potential of your data and that's what I do is comprehensive set off analysis. You can answer your advanced business question in just a few simple steps and the end speed of your time. Bring state. And with a new support for embrace, you can run sport like you on your data in your data warehouse and with spotted you monitor, you can monitor all the business metrics and not just died. We can also understand that teaching teaching drivers on those metrics on the platform of your choice. So with that, I'll hand over toe, you know. >>Thank you so much. Both of you That was fantastic. Um, I just love spot like, because it makes me look like much more of a rock star with data than I really am. So thank you guys for that fantastic presentation. Um, so we've got a couple of minutes for a couple of questions for you. The first one is for action. Um, once spot I Q generates a number of insights. Can you run spot I Q again on one of those insights? >>Yeah, As a philosophy off Spiric, you sport like you never takes the user to the dead end Spartak. You also transparently shares the calculation. So user can not only the keeper that on edit Understand how this product you inside has been calculated, but user can also run us for like you analysts is honest for data analysis as well. Which music? And continue to do not on the first level. Second level in the third level as well. >>That's cool. Thank you. Actually on then The next one is for because for spot ik monitor is it possible to edit the dimensions used for explaining the factors to change that was detected? >>Yes. It's an owner of the metric you can change the dimensions whenever you want and save them for everyone else. >>Okay, well, I think that's about all we've got time for in this session. So all that remains is for me to say a huge thank you to Because an Akshay Andi, we've got the last session of this track coming up in a few minutes. So grab a snack. Come right back and listen to an amazing customer story with Snowflake on Western Union, they're up next.

>>From around the globe. It's the cube with digital coverage of AWS reinvent 2020 sponsored by Intel, AWS, and our community partners. >>Hi everyone. Welcome back to the cubes. Virtual coverage of AWS reinvent 2020 virtual. We are the cube virtual I'm John ferry, your host with my coach, Dave Alante for keynote analysis from Swami's machine learning, all things, data huge. Instead of announcements, the first ever machine learning keynote at a re-invent Dave. Great to see you. Thanks Johnny. And from Boston, I'm here in Palo Alto. We're doing the cube remote cube virtual. Great to see you. >>Yeah, good to be here, John, as always. Wall-to-wall love it. So, so, John, um, how about I give you my, my key highlights from the, uh, from the keynote today, I had, I had four kind of curated takeaways. So the first is that AWS is, is really trying to simplify machine learning and use machine intelligence into all applications. And if you think about it, it's good news for organizations because they're not the become machine learning experts have invent machine learning. They can buy it from Amazon. I think the second is they're trying to simplify the data pipeline. The data pipeline today is characterized by a series of hyper specialized individuals. It engineers, data scientists, quality engineers, analysts, developers. These are folks that are largely live in their own swim lane. Uh, and while they collaborate, uh, there's still a fairly linear and complicated data pipeline, uh, that, that a business person or a data product builder has to go through Amazon making some moves to the front of simplify that they're expanding data access to the line of business. I think that's a key point. Is there, there increasingly as people build data products and data services that can monetize, you know, for their business, either cut costs or generate revenue, they can expand that into line of business where there's there's domain context. And I think the last thing is this theme that we talked about the other day, John of extending Amazon, AWS to the edge that we saw that as well in a number of machine learning tools that, uh, Swami talked about. >>Yeah, it was great by the way, we're live here, uh, in Palo Alto in Boston covering the analysis, tons of content on the cube, check out the cube.net and also check out at reinvent. There's a cube section as there's some links to so on demand videos with all the content we've had. Dave, I got to say one of the things that's apparent to me, and this came out of my one-on-one with Andy Jassy and Andy Jassy talked about in his keynote is he kind of teased out this idea of training versus a more value add machine learning. And you saw that today in today's announcement. To me, the big revelation was that the training aspect of machine learning, um, is what can be automated away. And it's under a lot of controversy around it. Recently, a Google paper came out and the person was essentially kind of, kind of let go for this. >>But the idea of doing these training algorithms, some are saying is causes more harm to the environment than it does good because of all the compute power it takes. So you start to see the positioning of training, which can be automated away and served up with, you know, high powered ships and that's, they consider that undifferentiated heavy lifting. In my opinion, they didn't say that, but that's clearly what I see coming out of this announcement. The other thing that I saw Dave that's notable is you saw them clearly taking a three lane approach to this machine, learning the advanced builders, the advanced coders and the developers, and then database and data analysts, three swim lanes of personas of target audience. Clearly that is in line with SageMaker and the embedded stuff. So two big revelations, more horsepower required to process training and modeling. Okay. And to the expansion of the personas that are going to be using machine learning. So clearly this is a, to me, a big trend wave that we're seeing that validates some of the startups and I'll see their SageMaker and some of their products. >>Well, as I was saying at the top, I think Amazon's really trying, working hard on simplifying the whole process. And you mentioned training and, and a lot of times people are starting from scratch when they have to train models and retrain models. And so what they're doing is they're trying to create reusable components, uh, and allow people to, as you pointed out to automate and streamline some of that heavy lifting, uh, and as well, they talked a lot about, uh, doing, doing AI inferencing at the edge. And you're seeing, you know, they, they, uh, Swami talked about several foundational premises and the first being a foundation of frameworks. And you think about that at the, at the lowest level of their S their ML stack. They've got, you know, GPU's different processors, inferential, all these alternative processes, processors, not just the, the Xav six. And so these are very expensive resources and Swami talked a lot about, uh, and his colleagues talked a lot about, well, a lot of times the alternative processor is sitting there, you know, waiting, waiting, waiting. And so they're really trying to drive efficiency and speed. They talked a lot about compressing the time that it takes to, to run these, these models, uh, from, from sometimes weeks down to days, sometimes days down to hours and minutes. >>Yeah. Let's, let's unpack these four areas. Let's stay on the firm foundation because that's their core competency infrastructure as a service. Clearly they're laying that down. You put the processors, but what's interesting is the TensorFlow 92% of tensor flows on Amazon. The other thing is that pie torch surprisingly is back up there, um, with massive adoption and the numbers on pie torch literally is on fire. I was coming in and joke on Twitter. Um, we, a PI torch is telling because that means that TensorFlow is originally part of Google is getting, is getting a little bit diluted with other frameworks, and then you've got MX net, some other things out there. So the fact that you've got PI torch 91% and then TensorFlow 92% on 80 bucks is a huge validation. That means that the majority of most machine learning development and deep learning is happening on AWS. Um, >>Yeah, cloud-based, by the way, just to clarify, that's the 90% of cloud-based cloud, uh, TensorFlow runs on and 91% of cloud-based PI torch runs on ADM is amazingly massive numbers. >>Yeah. And I think that the, the processor has to show that it's not trivial to do the machine learning, but, you know, that's where the infrared internship came in. That's kind of where they want to go lay down that foundation. And they had Tanium, they had trainee, um, they had, um, infrared chow was the chip. And then, you know, just true, you know, distributed training training on SageMaker. So you got the chip and then you've got Sage makers, the middleware games, almost like a machine learning stack. That's what they're putting out there >>And how bad a Gowdy, which was, which is, which is a patrol also for training, which is an Intel based chip. Uh, so that was kind of interesting. So a lot of new chips and, and specialized just, we've been talking about this for awhile, particularly as you get to the edge and do AI inferencing, you need, uh, you know, a different approach than we're used to with the general purpose microbes. >>So what gets your take on tenant? Number two? So tenant number one, clearly infrastructure, a lot of announcements we'll go through those, review them at the end, but tenant number two, that Swami put out there was creating the shortest path to success for builders or machine learning builders. And I think here you lays out the complexity, Dave butts, mostly around methodology, and, you know, the value activities required to execute. And again, this points to the complexity problem that they have. What's your take on this? >>Yeah. Well you think about, again, I'm talking about the pipeline, you collect data, you just data, you prepare that data, you analyze that data. You, you, you make sure that it's it's high quality and then you start the training and then you're iterating. And so they really trying to automate as much as possible and simplify as much as possible. What I really liked about that segment of foundation, number two, if you will, is the example, the customer example of the speaker from the NFL, you know, talked about, uh, you know, the AWS stats that we see in the commercials, uh, next gen stats. Uh, and, and she talked about the ways in which they've, well, we all know they've, they've rearchitected helmets. Uh, they've been, it's really a very much database. It was interesting to see they had the spectrum of the helmets that were, you know, the safest, most safe to the least safe and how they've migrated everybody in the NFL to those that they, she started a 24%. >>It was interesting how she wanted a 24% reduction in reported concussions. You know, you got to give the benefit of the doubt and assume some of that's through, through the data. But you know, some of that could be like, you know, Julian Edelman popping up off the ground. When, you know, we had a concussion, he doesn't want to come out of the game with the new protocol, but no doubt, they're collecting more data on this stuff, and it's not just head injuries. And she talked about ankle injuries, knee injuries. So all this comes from training models and reducing the time it takes to actually go from raw data to insights. >>Yeah. I mean, I think the NFL is a great example. You and I both know how hard it is to get the NFL to come on and do an interview. They're very coy. They don't really put their name on anything much because of the value of the NFL, this a meaningful partnership. You had the, the person onstage virtually really going into some real detail around the depth of the partnership. So to me, it's real, first of all, I love stat cast 11, anything to do with what they do with the stats is phenomenal at this point. So the real world example, Dave, that you starting to see sports as one metaphor, healthcare, and others are going to see those coming in to me, totally a tale sign that Amazon's continued to lead. The thing that got my attention was is that it is an IOT problem, and there's no reason why they shouldn't get to it. I mean, some say that, Oh, concussion, NFL is just covering their butt. They don't have to, this is actually really working. So you got the tech, why not use it? And they are. So that, to me, that's impressive. And I think that's, again, a digital transformation sign that, that, you know, in the NFL is doing it. It's real. Um, because it's just easier. >>I think, look, I think, I think it's easy to criticize the NFL, but the re the reality is, is there anything old days? It was like, Hey, you get your bell rung and get back out there. That's just the way it was a football players, you know, but Ted Johnson was one of the first and, you know, bill Bellacheck was, was, you know, the guy who sent him back out there with a concussion, but, but he was very much outspoken. You've got to give the NFL credit. Uh, it didn't just ignore the problem. Yeah. Maybe it, it took a little while, but you know, these things take some time because, you know, it's generally was generally accepted, you know, back in the day that, okay, Hey, you'd get right back out there, but, but the NFL has made big investments there. And you can say, you got to give him, give him props for that. And especially given that they're collecting all this data. That to me is the most interesting angle here is letting the data inform the actions. >>And next step, after the NFL, they had this data prep data Wrangler news, that they're now integrating snowflakes, Databricks, Mongo DB, into SageMaker, which is a theme there of Redshift S3 and Lake formation into not the other way around. So again, you've been following this pretty closely, uh, specifically the snowflake recent IPO and their success. Um, this is an ecosystem play for Amazon. What does it mean? >>Well, a couple of things, as we, as you well know, John, when you first called me up, I was in Dallas and I flew into New York and an ice storm to get to the one of the early Duke worlds. You know, and back then it was all batch. The big data was this big batch job. And today you want to combine that batch. There's still a lot of need for batch, but when people want real time inferencing and AWS is bringing that together and they're bringing in multiple data sources, you mentioned Databricks and snowflake Mongo. These are three platforms that are doing very well in the market and holding a lot of data in AWS and saying, okay, Hey, we want to be the brain in the middle. You can import data from any of those sources. And I'm sure they're going to add more over time. Uh, and so they talked about 300 pre-configured data transformations, uh, that now come with stage maker of SageMaker studio with essentially, I've talked about this a lot. It's essentially abstracting away the, it complexity, the whole it operations piece. I mean, it's the same old theme that AWS is just pointing. It's its platform and its cloud at non undifferentiated, heavy lifting. And it's moving it up the stack now into the data life cycle and data pipeline, which is one of the biggest blockers to monetizing data. >>Expand on that more. What does that actually mean? I'm an it person translate that into it. Speak. Yeah. >>So today, if you're, if you're a business person and you want, you want the answers, right, and you want say to adjust a new data source, so let's say you want to build a new, new product. Um, let me give an example. Let's say you're like a Spotify, make it up. And, and you do music today, but let's say you want to add, you know, movies, or you want to add podcasts and you want to start monetizing that you want to, you want to identify, who's watching what you want to create new metadata. Well, you need new data sources. So what you do as a business person that wants to create that new data product, let's say for podcasts, you have to knock on the door, get to the front of the data pipeline line and say, okay, Hey, can you please add this data source? >>And then everybody else down the line has to get in line and Hey, this becomes a new data source. And it's this linear process where very specialized individuals have to do their part. And then at the other end, you know, it comes to self-serve capability that somebody can use to either build dashboards or build a data product. In a lot of that middle part is our operational details around deploying infrastructure, deploying, you know, training machine learning models that a lot of Python coding. Yeah. There's SQL queries that have to be done. So a lot of very highly specialized activities, what Amazon is doing, my takeaway is they're really streamlining a lot of those activities, removing what they always call the non undifferentiated, heavy lifting abstracting away that it complexity to me, this is a real positive sign, because it's all about the technology serving the business, as opposed to historically, it's the business begging the technology department to please help me. The technology department obviously evolving from, you know, the, the glass house, if you will, to this new data, data pipeline data, life cycle. >>Yeah. I mean, it's classic agility to take down those. I mean, it's undifferentiated, I guess, but if it actually works, just create a differentiated product. So, but it's just log it's that it's, you can debate that kind of aspect of it, but I hear what you're saying, just get rid of it and make it simpler. Um, the impact of machine learning is Dave is one came out clear on this, uh, SageMaker clarify announcement, which is a bias decision algorithm. They had an expert, uh, nationally CFUs presented essentially how they're dealing with the, the, the bias piece of it. I thought that was very interesting. What'd you think? >>Well, so humans are biased and so humans build models or models are inherently biased. And so I thought it was, you know, this is a huge problem to big problems in artificial intelligence. One is the inherent bias in the models. And the second is the lack of transparency that, you know, they call it the black box problem, like, okay, I know there was an answer there, but how did it get to that answer and how do I trace it back? Uh, and so Amazon is really trying to attack those, uh, with, with, with clarify. I wasn't sure if it was clarity or clarified, I think it's clarity clarify, um, a lot of entirely certain how it works. So we really have to dig more into that, but it's essentially identifying situations where there is bias flagging those, and then, you know, I believe making recommendations as to how it can be stamped. >>Nope. Yeah. And also some other news deep profiling for debugger. So you could make a debugger, which is a deep profile on neural network training, um, which is very cool again on that same theme of profiling. The other thing that I found >>That remind me, John, if I may interrupt there reminded me of like grammar corrections and, you know, when you're typing, it's like, you know, bug code corrections and automated debugging, try this. >>It wasn't like a better debugger come on. We, first of all, it should be bug free code, but, um, you know, there's always biases of the data is critical. Um, the other news I thought was interesting and then Amazon's claiming this is the first SageMaker pipelines for purpose-built CIC D uh, for machine learning, bringing machine learning into a developer construct. And I think this started bringing in this idea of the edge manager where you have, you know, and they call it the about machine, uh, uh, SageMaker store storing your functions of this idea of managing and monitoring machine learning modules effectively is on the edge. And, and through the development process is interesting and really targeting that developer, Dave, >>Yeah, applying CIC D to the machine learning and machine intelligence has always been very challenging because again, there's so many piece parts. And so, you know, I said it the other day, it's like a lot of the innovations that Amazon comes out with are things that have problems that have come up given the pace of innovation that they're putting forth. And, and it's like the customers drinking from a fire hose. We've talked about this at previous reinvents and the, and the customers keep up with the pace of Amazon. So I see this as Amazon trying to reduce friction, you know, across its entire stack. Most, for example, >>Let me lay it out. A slide ahead, build machine learning, gurus developers, and then database and data analysts, clearly database developers and data analysts are on their radar. This is not the first time we've heard that. But we, as the kind of it is the first time we're starting to see products materialized where you have machine learning for databases, data warehouse, and data lakes, and then BI tools. So again, three different segments, the databases, the data warehouse and data lakes, and then the BI tools, three areas of machine learning, innovation, where you're seeing some product news, your, your take on this natural evolution. >>Well, well, it's what I'm saying up front is that the good news for, for, for our customers is you don't have to be a Google or Amazon or Facebook to be a super expert at AI. Uh, companies like Amazon are going to be providing products that you can then apply to your business. And, and it's allowed you to infuse AI across your entire application portfolio. Amazon Redshift ML was another, um, example of them, abstracting complexity. They're taking, they're taking S3 Redshift and SageMaker complexity and abstracting that and presenting it to the data analysts. So that, that, that individual can worry about, you know, again, getting to the insights, it's injecting ML into the database much in the same way, frankly, the big query has done that. And so that's a huge, huge positive. When you talk to customers, they, they love the fact that when, when ML can be embedded into the, into the database and it simplifies, uh, that, that all that, uh, uh, uh, complexity, they absolutely love it because they can focus on more important things. >>Clearly I'm this tenant, and this is part of the keynote. They were laying out all their announcements, quick excitement and ML insights out of the box, quick, quick site cue available in preview all the announcements. And then they moved on to the next, the fourth tenant day solving real problems end to end, kind of reminds me of the theme we heard at Dell technology worlds last year end to end it. So we are starting to see the, the, the land grab my opinion, Amazon really going after, beyond I, as in pass, they talked about contact content, contact centers, Kendra, uh, lookout for metrics, and that'll maintain men. Then Matt would came on, talk about all the massive disruption on the, in the industries. And he said, literally machine learning will disrupt every industry. They spent a lot of time on that and they went into the computer vision at the edge, which I'm a big fan of. I just loved that product. Clearly, every innovation, I mean, every vertical Dave is up for grabs. That's the key. Dr. Matt would message. >>Yeah. I mean, I totally agree. I mean, I see that machine intelligence as a top layer of, you know, the S the stack. And as I said, it's going to be infused into all areas. It's not some kind of separate thing, you know, like, Coobernetti's, we think it's some separate thing. It's not, it's going to be embedded everywhere. And I really like Amazon's edge strategy. It's this, you, you are the first to sort of write about it and your keynote preview, Andy Jassy said, we see, we see, we want to bring AWS to the edge. And we see data center as just another edge node. And so what they're doing is they're bringing SDKs. They've got a package of sensors. They're bringing appliances. I've said many, many times the developers are going to be, you know, the linchpin to the edge. And so Amazon is bringing its entire, you know, data plane is control plane, it's API APIs to the edge and giving builders or slash developers, the ability to innovate. And I really liked the strategy versus, Hey, here's a box it's, it's got an x86 processor inside on a, throw it over the edge, give it a cool name that has edge in it. And here you go, >>That sounds call it hyper edge. You know, I mean, the thing that's true is the data aspect at the edge. I mean, everything's got a database data warehouse and data lakes are involved in everything. And then, and some sort of BI or tools to get the data and work with the data or the data analyst, data feeds, machine learning, critical piece to all this, Dave, I mean, this is like databases used to be boring, like boring field. Like, you know, if you were a database, I have a degree in a database design, one of my degrees who do science degrees back then no one really cared. If you were a database person. Now it's like, man data, everything. This is a whole new field. This is an opportunity. But also, I mean, are there enough people out there to do all this? >>Well, it's a great point. And I think this is why Amazon is trying to extract some of the abstract. Some of the complexity I sat in on a private session around databases today and listened to a number of customers. And I will say this, you know, some of it I think was NDA. So I can't, I can't say too much, but I will say this Amazon's philosophy of the database. And you address this in your conversation with Andy Jassy across its entire portfolio is to have really, really fine grain access to the deep level API APIs across all their services. And he said, he said this to you. We don't necessarily want to be the abstraction layer per se, because when the market changes, that's harder for us to change. We want to have that fine-grained access. And so you're seeing that with database, whether it's, you know, no sequel, sequel, you know, the, the Aurora the different flavors of Aurora dynamo, DV, uh, red shift, uh, you know, already S on and on and on. There's just a number of data stores. And you're seeing, for instance, Oracle take a completely different approach. Yes, they have my SQL cause they know got that with the sun acquisition. But, but this is they're really about put, is putting as much capability into a single database as possible. Oh, you only need one database only different philosophy. >>Yeah. And then obviously a health Lake. And then that was pretty much the end of the, the announcements big impact to health care. Again, the theme of horizontal data, vertical specialization with data science and software playing out in real time. >>Yeah. Well, so I have asked this question many times in the cube, when is it that machines will be able to make better diagnoses than doctors and you know, that day is coming. If it's not here, uh, you know, I think helped like is really interesting. I've got an interview later on with one of the practitioners in that space. And so, you know, healthcare is something that is an industry that's ripe for disruption. It really hasn't been disruption disrupted. It's a very high, high risk obviously industry. Uh, but look at healthcare as we all know, it's too expensive. It's too slow. It's too cumbersome. It's too long sometimes to get to a diagnosis or be seen, Amazon's trying to attack with its partners, all of those problems. >>Well, Dave, let's, let's summarize our take on Amazon keynote with machine learning, I'll say pretty historic in the sense that there was so much content in first keynote last year with Andy Jassy, he spent like 75 minutes. He told me on machine learning, they had to kind of create their own category Swami, who we interviewed many times on the cube was awesome. But a lot of still a lot more stuff, more, 215 announcements this year, machine learning more capabilities than ever before. Um, moving faster, solving real problems, targeting the builders, um, fraud platform set of things is the Amazon cadence. What's your analysis of the keynote? >>Well, so I think a couple of things, one is, you know, we've said for a while now that the new innovation cocktail is cloud plus data, plus AI, it's really data machine intelligence or AI applied to that data. And the scale at cloud Amazon Naylor obviously has nailed the cloud infrastructure. It's got the data. That's why database is so important and it's gotta be a leader in machine intelligence. And you're seeing this in the, in the spending data, you know, with our partner ETR, you see that, uh, that AI and ML in terms of spending momentum is, is at the highest or, or at the highest, along with automation, uh, and containers. And so in. Why is that? It's because everybody is trying to infuse AI into their application portfolios. They're trying to automate as much as possible. They're trying to get insights that, that the systems can take action on. >>And, and, and actually it's really augmented intelligence in a big way, but, but really driving insights, speeding that time to insight and Amazon, they have to be a leader there that it's Amazon it's, it's, it's Google, it's the Facebook's, it's obviously Microsoft, you know, IBM's Tron trying to get in there. They were kind of first with, with Watson, but with they're far behind, I think, uh, the, the hyper hyper scale guys. Uh, but, but I guess like the key point is you're going to be buying this. Most companies are going to be buying this, not building it. And that's good news for organizations. >>Yeah. I mean, you get 80% there with the product. Why not go that way? The alternative is try to find some machine learning people to build it. They're hard to find. Um, so the seeing the scale of kind of replicating machine learning expertise with SageMaker, then ultimately into databases and tools, and then ultimately built into applications. I think, you know, this is the thing that I think they, my opinion is that Amazon continues to move up the stack, uh, with their capabilities. And I think machine learning is interesting because it's a whole new set of it's kind of its own little monster building block. That's just not one thing it's going to be super important. I think it's going to have an impact on the startup scene and innovation is going, gonna have an impact on incumbent companies that are currently leaders that are under threat from new entrance entering the business. >>So I think it's going to be a very entrepreneurial opportunity. And I think it's going to be interesting to see is how machine learning plays that role. Is it a defining feature that's core to the intellectual property, or is it enabling new intellectual property? So to me, I just don't see how that's going to fall yet. I would bet that today intellectual property will be built on top of Amazon's machine learning, where the new algorithms and the new things will be built separately. If you compete head to head with that scale, you could be on the wrong side of history. Again, this is a bet that the startups and the venture capitals will have to make is who's going to end up being on the right wave here. Because if you make the wrong design choice, you can have a very complex environment with IOT or whatever your app serving. If you can narrow it down and get a wedge in the marketplace, if you're a company, um, I think that's going to be an advantage. This could be great just to see how the impact of the ecosystem this will be. >>Well, I think something you said just now it gives a clue. You talked about, you know, the, the difficulty of finding the skills. And I think that's a big part of what Amazon and others who were innovating in machine learning are trying to do is the gap between those that are qualified to actually do this stuff. The data scientists, the quality engineers, the data engineers, et cetera. And so companies, you know, the last 10 years went out and tried to hire these people. They couldn't find them, they tried to train them. So it's taking too long. And now that I think they're looking toward machine intelligence to really solve that problem, because that scales, as we, as we know, outsourcing to services companies and just, you know, hardcore heavy lifting, does it doesn't scale that well, >>Well, you know what, give me some machine learning, give it to me faster. I want to take the 80% there and allow us to build certainly on the media cloud and the cube virtual that we're doing. Again, every vertical is going to impact a Dave. Great to see you, uh, great stuff. So far week two. So, you know, we're cube live, we're live covering the keynotes tomorrow. We'll be covering the keynotes for the public sector day. That should be chock-full action. That environment is going to impact the most by COVID a lot of innovation, a lot of coverage. I'm John Ferrari. And with Dave Alante, thanks for watching.

>> Voiceover: From around the globe, it's theCUBE, with coverage of Kubecon and CloudNativeCon, North America, 2020, virtual brought to you by Red Hat, the Cloud Native Computing Foundation and Ecosystem Partners. >> Welcome back to theCUBE's coverage, virtual coverage of Kubecon and CloudNativeCon 2020. We're not in person this year, normally we're there in person. We have to do remote because of the pandemic, but hey, it opens up more conversations. And this is theCUBE virtual. I'm John Furrier, your host. And you'll see a lot of interviews. We've got some great guests, Talking to the leaders, the developers, the end users, as well as the vendors with the CNCF, we got two great guests, Priyanka Sharma, the General Manager of the CNCF, great to see you and Stephen Augustus OSS Engineer at VMware. He's also the KubeCon co-chair back on the cube. Thanks for coming on folks. I appreciate it. >> Thank you for having us. So, thanks for coming on, actually, remote and virtual. We're doing a lot of interviews, we're getting some perspectives, people are chatting in Slack. It's still got the hallway vibe feel, a lot of talks, a lot of action, keynotes happening, but I think the big story for me, and I would like to talk about, I want to get your perspective is this new working group that's out there. So I know there's some news around it. Could you take a minute to explain kind of what this is all about? >> Sure. I'll give a little bit of context for those who may have missed my keynote which... very bad. (Priyanka laughs) As I announced, I'm so proud to be working with the likes of Stephen Augustus here, and a bunch of other folks from different companies, different open source projects, et cetera, to bring inclusive naming to code. I think it's been a forever issue. Quite frankly. We've had many problematic terms in software out there. The most obvious one being master-slave. That really shouldn't be there. That have no place in an inclusive world, inclusive software, inclusive community with the help of amazing people like Stephen, folks from IBM, Red Hat, and many, many others. We came together because while there's a lot of positive enthusiasm and excitement for people to make the changes that are necessary to make the community welcome for all, there's a lot of different work streams happening. And we really wanted to make sure there is a centralized place for guidelines and discussion for everybody in a very non...pan-organizational kind of way. And so that's the working group that John is talking about. With that said, Stephen, I think you can do the best justice to speak to the overall initiative. >> Yeah, absolutely. So I think that's to Priyanka's point, there are lots of people who are interested in this work and again, lots of work where this is already happening, which is very exciting to say, but as any good engineer, I think that's it's important to not duplicate your work. It's important to recognize the efforts that are happening elsewhere and work towards bringing people together. So part of this is providing, being able to provide a forum for discussion for a variety of companies, for a variety of associations that... and foundations that are involved in inclusive naming efforts. And then to also provide a framework for walking people through how we evaluate language and how we make these kinds of changes. As an example, for Kubernetes, we started off the Kubernetes working group naming and the hope for the working group naming was that it was going to evolve into hopefully an effort like this, where we could bring a lot of people on and not just talk about Kubernetes. So since we formed that back in, I want to say, June-ish, we've done some work on about of providing a language evaluation framework, providing templates for recommendations, providing a workflow for moving from just a suggestion into kind of actuating those ideas right and removing that language where it gets tricky and code is thinking about, thinking about, say a Kubernetes API. And in fact that we have API deprecation policies. And that's something that we have to if offensive language is in one of our APIs, we have to work through our deprecation policy to get that done. So lots of moving parts, I'm very excited about the overall effort. >> Yeah, I mean, your mind can explode if you just think about all the complications involved, but I think this is super important. I think the world has voted on this, I think it's pretty obvious and Priyanka, you hit some of the key top-line points, inclusive software. This is kind of the high order bit, but when you get down to it, it's hard as hell to do, because if you want to get ne new namings and/or changing namings accepted by the community and code owners, you're dealing with two things, a polarizing environment around the world today, and two, the hassles involved, which includes duplicate efforts. So you've got kind of a juggling act going on between two forces. So it's a hard problem. So how are you tackling this? Because it's certainly the right thing to do. There's no debate there. How do you make it happen? How do you go in without kind of blowing things up, if you will? And do it in a way that's elegant and clean and accept it. 'Cause that's the... end of the day, it's acceptance and putting it code owners. >> Absolutely. I think so, as you said, we live in a polarizing environment right now. Most of us here though know that this is the right thing to do. Team CloudNative is for everyone. And that is the biggest takeaway I hope people get from our work in this initiative. Open source belongs to everybody and it was built for the problems of today. That's why I've been working on this. Now, when it goes into actual execution, as you said, there are many moving parts, Stephen and the Kubernetes working group, is our shining example and a really good blueprint for many folks to utilize. In addition to that, we have to bring in diverse organizations. It's not just open source projects. It's not just companies. It's also standards organizations. It's also folks who think about language in books, who have literally done PhDs in this subject. And then there are folks who are really struggling through making the changes today and tomorrow and giving them hope and excitement. So that at the end of this journey, not only do you know you've done the right thing, but you'd be recognized for it. And more people will be encouraged by your own experience. So we and the LF have been thinking at it from a holistic perspective, let's bring in the standards bodies, let's bring in the vendors, let's bring in the open source projects, give them guidelines and blueprints that we are lucky that our projects are able to generate, combine it with learnings from other people, because many people are doing great work so that there is one cohesive place where people can go and learn from each other. Eventually, what we hope to do is also have like a recognition program so that it's like, hey, this open source project did this. They are now certified X or there's like an awards program. They're still figuring that piece out, but more to come on that space. That's my part. But Stephen can tell you about all the heavy lifting that they've been doing. >> Before we get to Steve, I just want to say congratulations to you. That's great leadership. And I think you're taking a pragmatic approach and you putting the stake in the ground. And that's the number one thing, and I want to take my hat off to you guys and Priyanka, thank you for that leadership. All right, Stephen, let's talk about how this gets done because you guys open sources is what it's all about is about the people, it's about building on the successes of others, standing on the shoulders of others, you guys are used to sitting in rooms now virtually and squabbling over things like, code reviews and you got governing bodies. This is not a new thing in collaboration. So this is also a collaboration test. What are you seeing as the playbook to get this going? Can you share your insights into what the Kubernetes group's doing and how you see this. What are the few first few steps you see happening? So people can either understand it, understand the context and get involved? >> So I think it comes down to a lot of it is scope, right? So as a new contributor, as a current contributor, maybe you are one of those language experts, that is interested in getting involved as a co-chair myself for SIG Release. A lot of the things that we do, we have to consider scope. If we make this change, how is it affecting an end user? And maybe you work in contributor experience. Maybe you work in release, maybe you work in architecture. But you may not have the entire scope that you need to make a change. So I think that first it's amazing to see all of the thought that has gone through making certain changes, like discussing master and slave, discussing how we name control plane members, doing the... having the discussion around a whitelist and blacklist. What's hard about it is, is when people start making those changes. We've already seen several instances of an invigorated contributor, and maybe the new contributor coming in and starting to kind of like search and replace words. And it... I wish it was that simple, it's a discussion that has to be heard, you need buy-in from the code owners, if it's an API that you're touching, it's a conversation that you need to have with the SIG Architecture, as well as say SIG Docs. If it's something that's happening in Release, then it's a easier 'cause you can come and talk to me, but, overall I think it's getting people to the point where they can clearly understand how a change affects the community. So we kind of in this language evaluation framework, we have this idea of like first, second and third order concerns. And as you go through those concerns, there are like diminishing impacts of potential harm that a piece of language might be causing to people. So first order concerns are the ones that we want to eliminate immediately. And the ones that we commonly hear this discussion framed around. So master-slave and whitelist, blacklist. So those are ones that we know that are kind of like on the track to be removed. The next portion of that it's kind of like understanding what it means to provide a recommendation and who actually approves the recommendation. Because this group is, we have several language aficionados in this group, but we are by now means experts. And we also want to make sure that we do not make decisions entirely for the community. So, discussing that workflow from a turning a recommendation into actuating a solution for that is something that we would also do with the steering committee. So Kubernetes kind of like top governing body. Making sure that the decision is made from the top level and kind of filtered out to all of the places where people may own code or documentation around it is I think is really the biggest thing. And having a framework to make it easy to make, do those evaluations, is what we've been craving and now have. >> Well, congratulations. That's awesome. I think it's always... it's easier said than done. I mean, it's a system when you have systems and code, it's like, there's always consequences in systems architecture, you know that you do in large scales OSS. You guys know what that means. And I think the low hanging fruit, obviously master, slave, blacklist, whitelist, that's just got to get done. I mean, to me, if that just doesn't get done, that's just like a stake in the ground that must happen. But I think this idea of it takes a village, kind of is a play here. People just buy into it. That so it's a little bit of a PR thing going on too, for get buy-in, this is again a classic, getting people on board, Priyanka, isn't it? It's the obvious and then there's like, okay, let's just do this. And then what's the framework? What's the process? What's the scope? >> Yeah, absolutely agree. And many people are midway through the journey. That's one of the big challenges. Some people are on different phases of the journey, and that was one of the big reasons we started this working group, because we want to be able to provide a place of conversation for people at different stages. So we get align now rather than a year later, where everybody has their own terms as replacements and nothing works. And maybe the downstream projects that are affected, like who knows, right? It can go pretty bad. And it's very complex and it's large-scale opensource or coasters, anywhere, large software. And so because team CloudNative belongs to everyone because open source belongs to everyone. We got up, get people on the same page. For those who are eager to learn more, as I said in my keynote, please do join the two sessions that we have planned. One is going to happen, which is about inclusive naming in general, it's an hour and a half session happening on Thursday. I'm pretty sure. And there we will talk about all the various artists who are involved. Everybody will have a seat at the table and we'll have documentation and a presentation to share on how we recommend the all move, move together as an ecosystem, and then second is a presentation by Celeste in the Kubernetes working group about how Kubernetes specifically has done naming. And I feel like Stephen, you and your peers have done such amazing work that many can benefit from it. >> Well, I think engineers, you got two things going to work in for you, which is one, it's a mission. And that's... There's certainly societal benefits for this code, code is for the people. Love that, that's always been the marching orders, but also engineers are efficient. If you have duplicate efforts. I mean, it's like you think about people just doing it on their own, why not do it now, do it together, more efficient, fixing bugs over stuff, you could have solved now. I mean, this is a huge issue. So totally believe it. I know we got to go, but I want to get the news and Priyanka, you guys had some new stuff coming out from the CNCF, new things, survey, certifications, all kinds of new reports. Give us the quick highlights on the news. >> Yes, absolutely. So much news. So many talking points. Well, and that's a good thing, why? Because the CloudNative Ecosystem is thriving. There is so many people doing so much awesome stuff that I have a lot to share with you. And what does that tell us about our spirit? It tells you about the spirit of resilience. You heard about that briefly in the conversation we just had with Stephen about our working group to align various parties and initiatives together, to bring inclusive naming to code. It's about resilience because we did not get demoralized. We did not say, "oh, it's a pandemic. I can't meet anyone. So this isn't happening." No, we kept going. And that is happening in inclusive naming that is happening in the CloudNative series we're doing, that's happening in the new members that are joining, as you may have seen Volcano Engine just joined as platinum member and that's super exciting. They come from China. They're part of the larger organization that builds Tik Tok, which is pretty cool as a frequent bruiser I can say that, in addition, on a more serious note, security is really key and as I was talking to someone just minutes ago, security is not something that's a fad. Security is something that as we keep innovating, as cloud native keeps being the ground zero, for all future innovation, it keeps evolving. The problems keep getting more complex and we have to keep solving them. So in that spirit, we in CNCF see it as our job, our duty, to enable the ecosystem to be better conversant in the security needs of our code. So to that end, we are launching the CKS program, which is a certification for our Kubernetes security specialist. And it's been in the works for awhile as many of you may know, and today we are able to accept registrations. So that's a really exciting piece of news, I recommend you go ahead and do that as part of the KubeCon registration folks have a discount to get started, and I think they should do it now because as I said, the security problems keep getting worse, keep getting more complicated. And this is a great baseline for folks to start when they are thinking about this. it's also a great boon for any company out there, whether they're end users, vendors, it's all sometimes a blurry line between the two, which is all healthy. Everybody needs developers who are security conversant I would say, and this certification help you helps you achieve that. So send all of your people to go take it. So that's sort of the announcements. Then other things I would like to share are as you go, sorry, were you saying something? >> No. Go ahead. >> No, as you know, we talked about the whole thing of team CloudNative is for everyone. Open source is for everyone And I'm really proud that CNCF has offered over 1000 diversity scholarships since 2016 to traditionally under-representing our marginalized groups. And I think that is so nice, and, but just the very, very beginning. As we grow into 2021, you will see more and more of these initiatives. Every member I talked to was so excited that we put our money where our mouth is, and we support people with scholarships, mentorships, and this is only going to grow. And it just so like at almost 17%, the CNCF mentors in our program are women. So for folks who are looking for that inspiration, for folks who want to see someone who looks like them in these places, they have more diverse people to look up to. And so overall, I think our DEI focus is something I'm very proud of and something you may hear about in other news items. And then finally, I would like to say is that CloudNative continues to grow. The cloud native wave is strong. The 2.0 for team CloudNative is going very well. For the CloudNative annual survey, 2020, we found an astonishing number of places where CloudNative technologies are in production. You heard some stories that I told in my keynote of people using multiple CNCF projects together. And these are amazing and users who have this running in production. So our ecosystem has matured. And today I can tell you that Kubernetes is used in production, by at about 83% of the places out there. And this is up by 5% from 78% last year. And just so much strength in this ecosystem. I mean, now at 92% of people are using containers. So at this point we are ubiquitous. And as you've heard from us in various times, our 70 plus project portfolio shows that we are the ground zero of innovation in cloud native. So if you asked me to summarize the news, it's number one, team CloudNative and open source is for everyone. Number two, we take pride in our diversity and over 1000 scholarships have been given out since 2016 to recipients from underrepresented groups. Number three, this is the home base for innovation with 83% of folks using Kubernetes in production and 70 plus projects that deliver a wide variety of support to enterprises as they modernize their software and utilize containers. >> Awesome. That was a great summary. First of all, you're a great host. You should be hosting theCUBE with us. Great keynote, love the virtual events that you guys have been doing, love the innovation. I think I would just say just from my perspective and being from there from the beginning is it's always been inclusive and the experience of the events and the community have been top-notch. People squabble, people talk, people have conversations, but at the end of the day, it is a great community and it's fun, memorable, and people are accepting, it's a great job. Stephen, good job as co-chair this year. Well done. Congratulations. >> Thank you very much. >> Okay. Thanks for coming on, I appreciate it. >> Take it easy. >> Okay, this is theCUBE virtual, we wish we were there in person, but we're not, we're remote. This is the virtual Cube. I'm John Furrier, your host. Thanks for watching. (upbeat music)

>> Announcer: From around the globe, it's theCUBE with digital coverage of Dell Technologies world, digital experience, brought to you by Dell Technologies. >> Hi, I'm Stu Miniman and this is theCUBE coverage of Dell Technologies world digital experience. Happy to welcome to the program. First we have a first time guest Akanksha Mehrotra, she's the Vice President of Marketing with Dell Technologies. Joining us one of our CUBE alumni, Caitlin Gordon, she's the Vice President of Product Marketing, also with Dell Technologies. Caitlin, welcome back, Akanksha welcome to the program. >> Thank you Stu, happy to be here. >> Alright, so one of the big models we've been talking about for the last few years is a change in how customers acquire things, big thing we've talked about, for many years, this shift from CAPEX to OPEX. How cloud is impacting everything Jeff Clarke in the keynote was talking about, it's the Dell Technologies on demand, DTOD, I guess is the, four letter acronym we use Akansha help us understand a little bit from your standpoint, what is it? Why is it important to your customers? >> Yeah, so Stu, as soon as you as you heard, as part of the keynote, from from Jeff and others earlier today, we've been working really hard to bring the benefits of on demand IT to our customers, in private cloud, public cloud and edge. And certainly this year, especially, we've seen a lot of interest in this, COVID have catalyzed customer interest in flexible consumption in as a service. As we talk with our customers and partners, we hear this almost daily, it's required a level of agility that candidly traditional CAPEX based models simply haven't been able to provide, I mean, imagine taking your workforce remote over the weekend, and the stress that puts on your infrastructure. And so I think that's kind of forced IT to consider some of these alternatives. Another factor has also been, companies have been wanting to preserve capital, right, and avoid large cash outlays and having this type of flexibility and being able to pay for infrastructure, as you're using it, it gives them a way to do that. So I mean, those are some of the customer drivers that we've seen. Last year at Dell Tech Summit, around the this time last year, actually, in November timeframe, we introduced Dell Technologies on demand as our umbrella program for a flexible consumption and as a service solutions. And really what it what it seeks to do is make it easier for customers to get the simplicity and flexibility of cloud, along with the performance and security of on-premises infrastructure. So it's giving them a range of consumption models that include both payment option as well as services that they can apply on any one of the products in our portfolio from end user devices to core data center infrastructure to hybrid cloud solutions. And we've announced that last year, one of the things that you heard about today, and that we're announcing over this event is that we're continually looking to make it easier and simpler for our customers with various turnkey offerings and simpler offerings for them, given the interest that we've seen. >> Yeah, I want to key off of, you mentioned the impact of COVID-19. And for your customers, it's something we've definitely seen that the promise of cloud always has been to be highly flexible, we can scale up, we can scale down. We know that some services out there aren't always as flexible as we might hope. There's certain SaaS solutions, where you're signing up for a multi year offering and even for the cloud, I might lock in some savings by buying something in bulk. So help us understand, what are the benefits that your customer sees, the savings that they get and is this truly cloud flexible, which means I can burst up and scale as I need. And I can it reached the point, oh, hey, I need half the capacity for the next six months. Can I do that? >> Yeah, absolutely. So, Stu we actually commissioned IBC to talk to a few of our customers. So let me maybe share some of the benefits that they saw in broad terms, and then I can maybe share a specific example of what a particular customer saw. So we had IDC talk to several of the customers using Dell Technologies on demand models, various GIOS, and various sort of sizes. And what they found was that on average, they saw about a 23%, lower cost of storage operations per year, which is great, right? Lower cost of operations is always great. IT is always looking for those efficiencies, especially, in the current environment, but that's not all. I think that's just sort of part of the story. What they also shared with us is that, these types of models were able to help them become much more agile in how they work and change how they work. And what they found was that they saw 54% fewer incidents of downtime and they were 92% faster in their ability to deploy storage capacity, because they had that capacity in their data center available ready for that spike when their business saw it. ` So those are just some of the broad examples of what our customers have seen. Another specific example that I would would share with you is a large multinational institution, financial services company, we've been working with them for years to service their, enterprise scale, private cloud. And then more recently, they had us also, manage their storage as a service managed utility. And they've seen phenomenal results, they've been able to get 50% more compute power at 8%, lower cost, and 90% faster or reduce time and provisioning data. It's all about the yes, it's about the cost savings but really, it's about the agility that the business gets, right. And as you started out, right, with COVID, they really needed that agility and that flexibility and having these models available, ready to spike, ready to go down, right, have been able to provide that. >> Yeah, I think another thing we've seen is, people rush to cloud because it promised that agility, and we've had those conversations before is, there's a reality of what that means, which it might not be the resiliency you're looking for, it also might not actually be as simple as he thought it might be. And we're seeing some of that come back on-prem, whether you need resiliency or performance or security, or you don't want to be really locked into a specific public cloud but you still want to have that agility in the benefits of really running your data center in a service oriented model. And that trend has been picking up over the past couple years. And as we've already said a couple times today, we've seen that accelerate, but also, we starting to see more customers ask for it. It's not just the big and more strategic and the aggressive customers that are looking for this more and more customers are kind of seeing that this is the end game and that's kind of leads into where we're going, which is, how do we make this more accessible to others? >> Well, Caitlin, you're using one of one of my punch lines that I've used for a number of years now if remember, when we thought that cloud was inexpensive and easy to use, it's not. And if we look at what customers are doing, it's a hybrid model. They're deploying in multiple environments, we're seeing the public cloud look more like the enterprise, the enterprise look more like, the public cloud. So these offerings have, OPEX flexibility and the like, make a whole lot of sense. So you've said that, you've seen a lot of growth, especially this year, any metrics you can give us on, adoption, love the one customer example, in the financial space, anything else to kind of paint the picture as to, how prevalent this is becoming. >> Yeah, maybe I'll get started. So, we've seen nearly 50%, year over year growth in the customer base or our most recent quarter, and it's growing, we've seen over 500% increase, year on year in signed contracts, customer demand in these types of models has caused us to expand our offerings to into countries like Brazil, Chile, Colombia, India, and China. I mean, we already offered about 50 plus countries and along with our partner, network and even more, so, I mean, those are just some of the data points around business traction. In the models that we have another proof point that I could point you to is that, in April, we include, we announced a payment flexibility program, which gave our customers a number of promotions and options to extend this flexibility into, across our portfolio and into other parts of our businesses. And just recently, about a month ago, we extended that, and we've seen really good traction in that as well. So I think overall, like you said there's aspects about public cloud that customers really like, and they tell us, hey, I want to be able to pay as I go, I want to be able to extend and contract the infrastructure as I'm using it. I want a simple management experience. But then as Caitlin said, they realize that Oh, but I don't want to, pay for the refactoring and then the egress and the ingress charges and some of my workloads are better off on premises for performance, locality, security, compliance reasons, right. And therein lies the promise of as a service for on-prem infrastructure, 'cause really, I keep looking for the best of both worlds. And this gives you that right you can use the consumption models to grow and shrink as you needed, you can us the payment models to only pay for what you're using and along with our partner network, you can have in the location that you want so you can sort of have your cake and eat it too. >> Yeah, and I would just add on to that is that more and more of the conversation is both about how can I consume that more as a service and pay for just what I'm using? But also, how can I spend less time maybe zero time and energy actually managing that infrastructure? And how can I then allocate the time energy resources into running my business and investing in more strategic things? So becomes both an important financial conversation but even more so a conversation about how IT can empower the business, which really just changes what we're able to do for customers. So it's an exciting kind of transition to see this really evolve into really not talking about products anymore, and helping our customers have all their business. >> Well, Caitlin, that's a really interesting point, I want you to talk to us a little bit about the Dell Tech storage as a service, how does that fit, we were just talking about don't want to talk about products, we want to talk about really moving to that full OPEX model so help connect the dots for us. >> Yeah, so we're really excited about this, this will be coming in the first half of next year, as you probably heard earlier today. And what we're doing here is we've really taken what we already have had in market. And we've really upped that to the next level, we've accelerated the simplicity of what we offer here. And think of the experience is all starting in a single console, where you just pick up four things, what's the type of storage you want, what's the performance you want, how much and for how long, that's it. And then now we're counting the time from then to when it's in your data center in days, not months, not weeks, but in days and we're able to get you up and going. And it's your data center of your choice, whether that's on-prem in your own data center, or at a colo facility, we bring that equipment in, we get that deployed, we manage it for you, you operate it, and you simply pay for what you use. So you're really in a quick time to value you're in a very simple model and you're not really responsible for managing infrastructure that's really on us. And that moves you into being in a true OPEX model and it also enables you to accelerate what you're able to leverage that whether it's Blob Storage, file storage, you can get up and running quickly and let us worry about how to manage the infrastructure and we give you the ability to operate what you need to. >> Caitlin, maybe if you could give us a little bit of color as to what happens behind the scenes to make that work. As it sounds wonderful, you've had the program around for a year, these aren't trivial things that you're talking about all the logistics, the management the the gear, and making sure that the physical and the power and everything is all set. So help us understand the engineering, the development, and what this means from kind of a services and go to market that make a solution like this work. >> Yeah, and a lot of ways we're having to change our entire business to help our customers change there's, it goes from top to bottom, and you'll get to hear a lot more about it when we're actually available next year. But when you think about it, we have a lot of the DNA, we have a lot of the experience, we have the technology, but we almost have to completely flip the script on ourselves of how we deliver it, who our customer is, what our then end user customer needs from us, and what the role of things like our global services organization is what the role of our global sales organization is and how do we accelerate providing outcomes to our customers and get the rest out of their way. And the fact that I haven't mentioned a product name, but by the way, we actually have industry leading products and pretty much every category. So of course, on the back end, all of this is going to be powered by our industry leading storage solutions, like power store will be in your data center but at the same time, we will actually have worked to really masked that you don't even need to know that nor do you need to really operate much beyond what you need to really run your business. And that's really it's been an interesting work for us to just flip how we think about everything and you'll hear a whole lot more about it next year as we really bring this out into market but it's been really fun and a big learning for everyone. >> Excellent well yeah, something something power is underneath there well Caitlin. All right why don't you both give us the final takeaway for the Dell Tech on demand account. Start with you in just give us the final takeaway. >> Yeah, so I think look, I back to kind of what we were talking about, we've actually been offering these types of solutions to our customers for a really long time. Through Dell financial services, we've been offering payment flexibility for over 23 years, over 15 years and manage utility. So the customer example that I gave you is a customer who's running storage as a service and has been for many years, I think, building on that experience, listening to our customers feedback over that time period and over, of course, this past year, we're looking to apply all of that, to make it even more simpler for them to consume our infrastructure in the near future. And so, storage as a service is going to be a really exciting proof point of that, the momentum stats and some of the other things that I shared with you today and that you're going to hear about over the next couple of days or another proof point of it. But we're excited about this, and looking forward to continuing the dialogue with our customers with our partners and (mumbles) >> Then I would I'll kind of play off of one of your words there which is is all about simplicity for us is how do we take what we've been able to do for a lot of our customers accelerate that and simplify it to a point where we can offer that for all of our customers. And we're really looking to accelerate this first with storage and then get all of our offerings really into this model, because it's really about getting our customers out of managing infrastructure and give them the time, energy, resources to manage their business and simplicity is paramount to making sure that happens. >> Caitlin and Akanksha, thank you so much for giving us the updates. Congratulations to all the progress and definitely looking forward to hearing more beginning of next year. Thanks for joining. >> Thank you Stu. >> Thank you Stu >> All right, I'm Stu Miniman this is Dell Technology world digital experience. I'm Stu Miniman. And thank you as always for watching theCUBE (upbeat music)

from the cube studios in Palo Alto in Boston connecting with thought leaders all around the world this is a cube conversation as we've been reporting the Koba 19 pandemic has created a bifurcated IT spending picture and over the last several weeks we've reported both on the macro and even some come at it from from a vendor and a sector view I mean for example we've reported on some of the companies that have really continued to thrive we look at the NASDAQ and its you know near at all-time highs companies like oh and in CrowdStrike we've reported on snowflake uipath the sectors are PA some of the analytic databases around AI maybe even to a lesser extent cloud but still has a lot of tailwind relative to some of those on-prem infrastructure plays even companies like Cisco bifurcated in and of themselves where you see this Meraki side of the house you know doing quite well the work from home stuff but maybe some of the traditional networking not as much well now what if you flip that to really try to understand what's going on with the shape of the recovery which is the main narrative right now is it a v-shape does it a u-shape what is what's that what do people expect and now you understand that you really have to look at different industries because different industries are going to come back at a different pace with me again is Sagar khadiyah who's the director of research at EGR Sagar you guys are all over this as usual timely information it's great to see you again hope all is well in New York City thanks so much David it's a pleasure to be back on again yeah so where are we in the cycle we give dividend a great job and very timely ETR was the first to really put out data on the koban impact with the survey that ran from mid-march to to mid-april and now everybody's attention sagar is focused on okay we're starting to come back stores are starting to open people are beginning to to go out again and everybody wants to know what the shape of the recovery looks like so where are we actually in that research cycle for you guys yeah no problem so like you said you know in that kind of march/april timeframe we really want to go out there and get an idea of what we're doing the budget impacts you know as it relates to IT because of kovat 19 right so we kind of ended off there around a decline of 5% and coming into the year the consensus was of growth of 4 or 5% right so we saw about a 900,000 basis points wing you know to the negative side and the public covered in March and April were you know which sectors and vendors were going to benefit as a result of work from home and so now as we kind of fast forward to the research cycle as we kind of go more into May and into the summer rather than asking those exact same question to get again because it's just been you know maybe 40 or 50 days we really want Singh on the recovery type as well as kind of more emerging private vendors right we want to understand what's gonna be the impact on on these vendors that typically rely on you know larger conferences more in-person meetings because these are younger technologies there's not a lot of information about them and so last Thursday we launched our biannual emerging technology study it covers roughly 300 private emerging technologies across maybe 60 sectors of technology and in tandem we've launched a co-ed flash poll right what we wanted to do was kind of twofold one really understand from CIOs the recovery type they had in mind as well as if they were seeing any any kind of permanent changes in their IT stacks IT spend because of koban 19 and so if we kind of look at the first chart here and kind of get more into that first question around recovery type what we asked CIOs and this kind of COBIT flash poll again we did it last Thursday was what type of recovery are you expecting is it v-shaped so kind of a brief decline you know maybe one quarter and then you're gonna start seeing growth in 2 to H 20 is it you shaped so two to three quarters of a decline or deceleration revenue and you're kind of forecasting that growth in revenue as an organization to come back in 2021 is it l-shaped right so maybe three four five quarters of a decline or deceleration and then you know very minimal to moderate growth or none of the above you know your organization is actually benefiting from from from koban 19 as you know we've seen some many reports so those are kind of the options that we gave CIOs and you kind of see it on that first chart here interesting and this is a survey a flash service 700 CIOs or approximately and the interesting thing I really want to point out here is this you know the koban pandemic was it didn't suppress you know all companies you know and in the return it's not going to be a rising tide lifts all ships you really got to do your research you have to understand the different sectors really try to peel back the onion skin and understand why there's certain momentum how certain organizations are accommodating the work from home we heard you know several weeks ago how there's a major change in in networking mindsets we're talking about how security is changing we're going to talk about some of the permanence but it's really really important to try to understand these different trends by different industries which you're going to talk about in a minute but if you take a look at this slide I mean obviously most people expect this u-shaped decline I mean a you know a u-shaped recovery rather so it's two or three quarters followed by some growth next year but as we'll see some of these industries are gonna really go deeper with an l-shape recovery and then it's really interesting that a pretty large and substantial portion see this as a tailwind presumably those with you know strong SAS models some annual recurring revenue models your thoughts if we kind of star on this kind of aggregate chart you know you're looking at about forty four percent of CIOs anticipated u-shaped recovery right that's the largest bucket and then you can see another 15 percent and to say an l-shape recovery 14 on the v-shaped and then 16 percent to your point that are kind of seeing this this tailwind but if we kind of focus on that largest bucket that you shaped you know one of the thing to remember and again when we asked is two CIOs within the within this kind of coded flash poll we also asked can you give us some commentary and so one of the things that or one of the themes that are kind of coming along with this u-shaped recovery is you know CIOs are cautiously optimistic about this u-shaped recovery you know they believe that they can get back on to a growth cycle into 2021 as long as there's a vaccine available we don't go into a second wave of lockdowns economic activity picks up a lot of the government actions you know become effective so there are some kind of let's call it qualifiers with this bucket of CIOs that are anticipating a u-shape recovery what they're saying is that look we are expecting these things to happen we're not expecting that our lock down we are expecting a vaccine and if that takes place then we do expect an uptick in growth or going back to kind of pre coded levels in in 2021 but you know I think it's fair to assume that if one or more of these are apps and and things do get worse as all these states are opening up maybe the recovery cycle gets pushed along so kind of at the aggregate this is where we are right now yeah so as I was saying and you really have to understand the different not only different sectors and all the different vendors but you got to look into the industries and then even within industries so if we pull up the next chart we have the industry to the breakdown and sort of the responses by the industries v-shape you shape or shape I had a conversation with a CIO of a major resort just the other day and even he was saying what was actually I'll tell you it was Windham Resorts public company I mean and obviously that business got a good crush they had their earnings call the other day they talked about how they cut their capex in half but the stock sagar since the March lows is more than doubled yeah and you know that's amazing and now but even there within that sector they're peeling that on you're saying well certain parts are going to come back sooner or certain parts are going to longer depending on you know what type of resort what type of hotel so it really is a complicated situation so take us through what you're seeing by industry sure so let's start with kind of the IT telco retail consumer space Dave to your point there's gonna be a tremendous amount of bifurcation within both of those verticals look if we start on the IT telco side you know you're seeing a very large bucket of individuals right over twenty percent that indicated they're seeing a tail with our additional revenue because of covin 19 and you know Dave we spoke about this all the way back in March right all these work from home vendors you know CIOs were doubling down on cloud and SAS and we've seen how some of these events have reported in April you know with this very good reports all the major cloud vendors right select security vendors and so that's why you're seeing on the kind of telco side definitely more positivity right as it relates to recovery type right some of them are not even going through recovery they're they're seeing an acceleration same thing on the retail consumer side you're seeing another large bucket of people who are indicating what we've benefited and again there's going to be a lot of bifurcation here there's been a lot of retail consumers you just mentioned with the hotel lines that are definitely hurting but you know if you have a good online presence as a retailer and you know you had essential goods or groceries you benefited and and those are the organizations that we're seeing you know really indicate that they saw an acceleration due to Koga 19 so I thought those two those two verticals between kind of the IT and retail side there was a big bucket or you know of people who indicated positivity so I thought that was kind of the first kind of you know I was talking about kind of peeling this onion back you know that was really interesting you know tech continues to power on and I think you know a lot of people try I think that somebody was saying that the record of the time in which we've developed a fit of vaccine previously was like mumps or something and it was I mean it was just like years but now today 2020 we've got a I we've got all this data you've got these great companies all working on this and so you know wow if we can compress that that's going to change the equation a couple other things sagar that jump out at me here in this chart I want to ask you about I mean the education you know colleges are really you know kind of freaking out right now some are coming back I know like for instance my daughter University Arizona they're coming back in the fall evidently others are saying and no you can clearly see the airlines and transportation as the biggest sort of l-shape which is the most negative I'm sure restaurants and hospitality are kind of similar and then you see energy you know which got crushed we had you know oil you know negative people paying it big barrels of oil but now look at that you know expectation of a pretty strong you know you shape recovery as people start driving again and the economy picks up so maybe you could give us some thoughts on on some of those sort of outliers yeah so I kind of bucket you know the the next two outliers as from an l-shaped in a u-shaped so on the l-shaped side like like you said education airlines transportation and probably to a little bit lesser extent industrials materials manufacturing services consulting these verticals are indicating the highest percentages from an l-shaped recovery right so three plus orders of revenue declines and deceleration followed by kind of you know minimal to moderate growth and look there's no surprise here those are the verticals that have been impacted the most by less demand from consumers and and businesses and then as you mentioned on the energy utility side and then I would probably bucket maybe healthcare Pharma those have some of the largest percentages of u-shaped recovery and it's funny like I read a lot of commentary from some of the energy in the healthcare CIOs and they were said they were very optimistic about a u-shaped type of recovery and so it kind of you know maybe with those two issues then you could even kind of lump them into you know probably to a lesser extent but you could probably open into the prior one with the airlines and the education and services consulting and IMM where you know these are definitely the verticals that are going to see the longest longest recoveries it's probably a little bit more uniform versus what we've kind of talked about a few minutes ago with you know IT and and retail consumer where it's definitely very bifurcated you know there's definitely winners and losers there yeah and again it's a very complicated situation a lot of people that I've talked to are saying look you know we really don't have a clear picture that's why all these companies have are not giving guidance many people however are optimistic not only for a vet a vaccine but but but also they're thinking as young people with disposable income they're gonna kind of say dorm damn the torpedoes I'm not really going to be exposed and you know they can come back much stronger you know there seems to be pent up demand for some of the things like elective surgery or even the weather is sort of more important health care needs so that obviously could be a snap back so you know obviously we're really closely looking at this one thing though is is certain is that people are expecting a permanent change and you've got data that really shows that on the on the next chart that's right so one of the one of the last questions that we asked on this you know quick coded flash poll was do you anticipate permanent changes to your kind of IT stack IT spend based on the last few months you know as everyone has been working remotely and you know rarely do you see results point this much in one direction but 92% of CIOs and and kind of IT you know high level ITN users indicated yes there are going to be permanent changes and you know one of the things we talked about in March and look we were really the first ones you know you know in our discussion where we were talking about work from home spend kind of negating or balancing out all these declines right we were saying look yes we are seeing a lot of budgets come down but surprisingly we're seeing 2030 percent of organizations accelerate spent and even the ones that are spending less they even then you know some of their some of their budgets are kind of being negated by this work from home spend right when you think about collaboration tool is an additional VPN and networking bandwidth in laptops and then security all that stuff CIOs now continue to spend on because what what CIO is now understand as productivity has remained at very high levels right in March CIOs were very with the catastrophe and productivity that has not come true so on the margin CIOs and organizations are probably much more positive on that front and so now because there is no vaccine where you know CIOs and just in general the population we don't know when one is coming and so remote work seems to be the new norm moving forward especially that productivity you know levels are are pretty good with people working from home so from that perspective everything that looked like it was maybe going to be temporary just for the next few months as people work from home that's how organizations are now moving forward well and we saw Twitter basically said we're gonna make work from home permanent that's probably cuz their CEO wants to you know live in Africa Google I think is going to the end of the year I think many companies are going to look at a hybrid and give employees a choice say look if you want to work from home and you can be productive you get your stuff done you know we're cool with that I think the other point is you know everybody talks about these digital transformations you know leading into Kovan and I got to tell you I think a lot of companies were sort of complacent they talked the talk but they weren't walking the walk meaning they really weren't becoming digital businesses they really weren't putting data at the core and I think now it's really becoming an imperative there's no question that that what we've been talking about and forecasting has been pulled forward and you you're either going to have to step up your digital game or you're going to be in big trouble and the other thing that's I'm really interested in is will companies sub optimize profitability in the near term in order to put better business resiliency in place and better flexibility will they make those investments and I think if they do you know longer term they're going to be in better shape you know if they don't they could maybe be okay in the near term but I'm gonna put a caution sign a little longer term no look I think everything that's been done in the last few months you know in terms of having those continuation plans because you know do two pandemics all that stuff that is now it look you got to have that in your playbook right and so to your point you know this is where CIOs are going and if you're not transforming yourself or you didn't or you know lesson learned because now you're probably having to move twice as fast to support all your employees so I think you know this pandemic really kind of sped up you know digital transformation initiatives which is why you know you're seeing some companies desks and cloud related companies with very good earnings reports that are guiding well and then you're seeing other companies that are pulling their guidance because of uncertainty but it's it's likely more on the side of they're just not seeing the same levels of spend because if they haven't oriented themselves on that digital transformation side so I think you know events like this they typically you know Showcase winners and losers then you know when when things are going well and you know everything is kind of going up well I think that - there's a big you know discussion around is the ESPY overvalued right now I won't make that call but I will say this then there's a lot of data out there there's data and earnings reports there's data about this pandemic which change continues to change maybe not so much daily but you're getting new information multiple times a week so you got to look to that data you got to make your call pick your spot so you talk about a stock pickers market I think it's very much true here there are some some gonna be really strong companies emerging out of this you know don't gamble but do your research and I think you'll you'll find some you know some Dems out there you know maybe Warren Buffett can't find them okay but the guys at Main Street I think you know the I am I'm optimistic I wonder how you feel about about the recovery I I think we may be tainted by tech you know I'm very much concerned about certain industries but I think the tech industry which is our business is gonna come out of this pretty strong yeah we look at the one thing we we should we should have stated this earlier the majority of organizations are not expecting a v-shaped recovery and yet I still think there's part of the consensus is expecting a v-shaped recovery you can see as we demonstrate in some of the earlier charts the you know almost the majority of organizations are expecting a u-shaped recovery and even then as we mentioned right that you shape there is some cautious up around there and I have it you probably have it where yes if everything goes well it looks like 2021 we can really get back on track but there's so much unknown and so yes that does give I think everyone pause when it comes from an investment perspective and even just bringing on technologies and into your organization right which ones are gonna work which ones are it so I'm definitely on the boat of this is a more u-shaped in a v-shaped recovery I think the data backs that up I think you know when it comes to cloud and SAS players those areas and I think you've seen this on the investment side a lot of money has come out of all these other sectors that we mentioned that are having these l-shaped recoveries a lot of it has gone into the tech space I imagine that will continue and so that might be kind of you know it's tough to sometimes balance what's going on on the investor in the stock market side with you know how organizations are recovering I think people are really looking out in two to three quarters and saying look you know to your point where you set up earlier is there a lot of that pent up demand are things gonna get right back to normal because I think you know a lot of people are anticipating that and if we don't see that I think you know the next time we do some of these kind of coded flash bolts you know I'm interested to see whether or not you know maybe towards the end of the summer these recovery cycles are actually longer because maybe we didn't see some of that stuff so there's still a lot of unknowns but what we do know right now is it's not a v-shaped recovery agree especially on the unknowns there's monetary policy there's fiscal policy there's an election coming up there's a third there's escalating tensions with China there's your thoughts on the efficacy of the vaccine what about therapeutics you know do people who have this yet immunity how many people actually have it what about testing so the point I'm making here is it's very very important that you update your forecast regularly that's why it's so great that I have this partnership with you guys because we you know you're constantly updating the numbers it's not just a one-shot deal so suck it you know thanks so much for coming on looking forward to having you on in in the coming weeks really appreciate it absolutely yeah well I will really start kind of digging into how a lot of these emerging technologies are faring because of kovat 19 so that's I'm actually interested to start thinking through the data myself so yeah well we'll do some reporting in the coming weeks about that as well well thanks everybody for watching this episode of the cube insights powered by ETR I'm Dave Volante for sauger kuraki check out ETR dot plus that's where all the ETR data lives i published weekly on wiki bon calm and silicon angle calm and reach me at evil on Tay we'll see you next time [Music]

(upbeat music) >> From theCUBE Studios in Palo Alto in Boston, connecting with thought leaders all around the world, this is a Cube Conversation. >> As we've been reporting, the COVID-19 pandemic has created a bifurcated IT spending picture. And over the last several weeks, we've reported both in the macro and even some come at it from a vendor and a sector view. I mean, for example, we've reported on some of the companies that have really continued to thrive, we look at the NASDAQ and its near a toll-time hard. Companies like Okta and CrowdStrike, we've reported on Snowflake, UiPath. The sectors, RPA, some of the analytic databases around AI, maybe even to a lesser extent Cloud but still has a lot tailwinds relative to some of those on-prem infrastructure plays. Even companies like Cisco, bifurcated in and of themselves, where you see this more rocky side of the house doing quite well. The work-from-home stuff but maybe some of the traditional networking not as much. Well, now what if you flip that to really try to understand what's going on with the shape of the recovery which is the main narrative right now. Is it a V shape? Is it a U shape? What do people expect? And now to understand that, you really have to look at different industries because different industries are going to come back at a different pace. With me again is Sagar Kadakia, who's the Director of Research at ETR. Sagar, you guys are all over this, as usual timely information, it's great to see you again. Hope all is well in New York City. >> Thanks so much David, it's a pleasure to be back on again. >> Yeah, so where are we in the cycle? You've done a great job and very timely, ETR was the first to really put out data on the Covid impact with the server that ran from mid March to mid April. And now everybody's attention Sagar, is focused on, okay, we've started to come back, stores are starting to open, people are beginning to go out again and everybody wants to know what the shape of the recovery looks like. So, where are we actually in that research cycle for you guys? >> Yeah, no problem. So, like you said, in that kind of March, April timeframe, we really want to go out there and get an idea of what are going to be the budget impacts as it relates to IT because of COVID-19, right? So, we kind of ended off there around a decline of 5%. And coming into the year, the consensus was a growth of 4% or 5%, right? So, we saw about a 900 or 1000 base point swing, to the negative side. And then (murmurs) topic we covered in March and April were which sectors of vendors were going to benefit as a result of work-from-home. And so, now as we kind of fast forward to the research cycle as we kind of go more into May and into the summer, rather than asking those exact same question again, because it's just been maybe 40 or 50 days. We really want to (murmurs) on the recovery type as well as well as kind of more emerging private vendors, right? We want it to understand what's going to be the impact on these vendors that typically rely on larger conferences, more in person meetings, because these are younger technologies. There's not a lot of information about them. And so, last Thursday we launched our biannual emerging technology study. It covers roughly 300 private emerging technologies across maybe 60 sectors of technology. And in tandem, we've launched a COVID Flash Poll, right? What we want to do was kind of twofold. One really understand from CIOs the recovery type they had in mind, as well as if they were seeing any kind of permanent changes in their IT, stacks IT spend because of COVID-19. And so, if we kind of look at the first chart here, and kind of get more into that first question around recovery type, what we asked CIOs in this kind of COVID Flash Poll, again, we did it last Thursday was, what type of recovery are you expecting? Is it V-shaped so kind of of a brief decline, maybe 1/4, and then you're going to start seeing growth into 2 each 20. Is it U-shaped? So two to 3/4 of a decline or deceleration revenue, and you're kind of forecasting that growth in revenue as an organization to come back in 2021. Is it L-shaped, right? So, maybe three, four or 5/4 of a decline or deceleration. And very minimal to moderate growth or none of the above, your organization is actually benefiting from COVID-19, as we've seen some many reports. So, those are kind of the options that we gave CIOs and you kind of see them at first chart here. >> Well, interesting. And this is a survey, a flash of survey, 700 CIOs or approximately. And the interesting thing I really want to point out here is, the COVID pandemic, it didn't suppress all companies, and the return is it's not going to be a rising tide that lifts all ships. You really got to do your research. You have to understand the different sectors, really try to peel back the onion skin and understand why there are certain momentum, how certain organizations are accommodating the work from home. We heard several weeks ago, how there's a major change in networking mindsets we're talking about how security is changing. We're going to talk about some of the permanents, but it's really, really important to try to understand these different trends by different industries, which we're going to talk about in a minute. But if you take a look at this slide, I mean, obviously most people expect this U-shape decline. I mean, U-shape recovery rather. So it's two or 3/4 followed by some growth next year. But as we'll see, some of these industries are going to really go deeper with an L-shape recovery. And then it's really interesting that a pretty large and substantial portion see this as a tailwind, presumably those with strong SAS models, annual recurring revenue models, your thoughts? >> If we kind of start on this kind of aggregate chart, you're looking at about 44% of CEO's anticipate a U-shaped recovery, right? That's the largest bucket. Then you can see another 15% anticipate an L-shape recovery 14 on the V-shaped, and then 16% to your point that are kind of seeing this tailwind. But if we kind of focus on that largest bucket that U-shaped, one of the things to remember and again, when we asked this to CIOs within this kind of COVID Flash Poll, we also asked, can you give us some commentary? And so, one of the things that, or one of the themes that are kind of coming along with this U-shape recovery is CIOs are cautiously optimistic about this U-shape recovery. They believe that they can get back onto a growth cycle, into 2021, as long as there's a vaccine available. We don't go into a second wave of lockdowns. Economic activity picks up, a lot of the government actions become effective. So there are some kind of let's call it qualifiers, with this bucket of CIOs that are anticipating a U-shape recovery. What they're saying is that, "look, we are expecting these things to happen, "we're not expecting a lockdown, "we are expecting a vaccine. "And if that takes place, "then we do expect an uptake in growth, "or going back to kind of pre COVID levels in 2021." But I think it's fair to assume that if one or more of these are ups and things do get worse as all these States are opening up, maybe the recovery cycle gets pushed along. So kind of at the aggregate, this is where we are right now. >> Yeah. So as I was saying, you really have to understand the different, not only different sectors not only the different vendors, but you can really get to look into the industries, and then even within industries. So if we pull up the next chart, we have the industry sort of break down, and sort of the responses by the industry's V-shape, U-shape or L-shape. I had a conversation with a CIO of a major resort, just the other day. And even he was saying, well, it was actually, I'll tell you it was Wyndham Resorts, public company. I mean, and obviously that business got crushed. They had their earnings call the other day. They talked about how they cut their capex in half. But the stock, Sagar, since the March loss is more than doubled. >> Yeah. >> It was just amazing. And now, but even there, within that sector, they're appealing that on you are doing well, certain parts are going to come back sooner, certain parts are going to take longer, depending on, what type of resort, what type of hotel. So, it really is a complicated situation. So, take us through what you're seeing by industry. >> Yeah, sure. So let's start with kind of the IT-Telco, retail, consumer space. Dave to your point, there's going to be a tremendous amount of bifurcation within both of those verticals. Look, if we start on the IT-Telco side, you're seeing a very large bucket of individuals, right over 20%? That indicated they're seeing a tailwind or additional revenue because of COVID-19 and Dave, we spoke about this all the way back in March, right? All these work from home vendors. CIOs were doubling down on Cloud and SAS and we've seen how some of these vendors have reported in April, with very good reports, all the major Cloud vendors, right? Like Select Security vendors. And so, that's why you're seeing on the kind of Telco side, definitely more positivity, right? As you relates to recovery type, right? Some of them are not even going through recovery. They're seeing an acceleration, same thing on the retail consumer side. You're seeing another large bucket of people who are indicating, "look, we've benefited." And again, there's going to be a lot of bifurcation, there's been a lot of retail consumers. You just mentioned with the hotel lines, that are definitely hurting. But if you have a good online presence as a retailer, and you had essential goods or groceries, you benefited. And those are the organizations that we're seeing really indicate that they saw an acceleration due to COVID-19. So, I thought those two verticals between kind of the IT and retail side, there was a big bucket of people who indicated positivity. So I thought that was kind of the first kind of as we talked about kind of feeling this onion back. That was really interesting. >> Tech continues to power on, and I think a lot of people try, I think somebody was saying that the record time in which we've developed a vaccine previously was like mumps or something. I mean, it was just like years. But now today, 2020, we've got AI, we've got all this data, you've got these great companies all working on this. And so, wow, if we can compress that, that's going to change the equation. A couple of other things Sagar that jump out at me here in this chart that I want to ask you about. I mean, the education, the colleges, are really kind of freaking out right now, some are coming back. I know, like for instance, my daughter at University of Arizona, they're coming back in the fall indefinitely, others are saying, no. You can clearly see the airlines and transportation, has the biggest sort of L-shape, which is the most negative. I'm sure restaurants and hospitality are kind of similar. And then you see energy which got crushed. We had oil (laughs) negative people paying it, big barrels of oil. But now look at that, expectation of a pretty strong, U-shape recovery as people start driving again, and the economy picks up. So, maybe you could give us some thoughts on some of those sort of outliers. >> Yeah. So I kind of bucket the next two outliers as from an L-shaped and a U-shaped. So on the L-shaped side, like you said, education airlines, transportation, and probably to a little bit lesser extent, industrials materials, manufacturing services consulting. These verticals are indicating the highest percentages from an L-shaped recovery, right? So, three plus 1/4 of revenue declines in deceleration, followed by kind of minimal to moderate growth. And look, there's no surprise here. Those are the verticals that have been impacted the most, by less demand from consumers and businesses. And then as you mentioned on the energy utility side, and then I would probably bucket maybe healthcare, pharma, those have some of the largest, percentages of U-shaped recovery. And it's funny, like I read a lot of commentary from some of the energy and the healthcare CIOs, and they were saying they were very optimistic (laughs) about a U-shaped type of recovery. And so it kind of, maybe with those two issues that we could even kind of lump them into, probably to a lesser extent, but you could probably lump it into the prior one with the airlines and the education and services consulting, and IMM, where these are definitely the verticals that are going to see the longest, longest recoveries. And it's probably a little bit more uniform, versus what we've kind of talked about a few minutes ago with IT and retail consumer where it's definitely very bifurcated. There's definitely winners and losers there. >> Yeah. And again, it's a very complicated situation. A lot of people that I've talked to are saying, "look, we really don't have a clear picture, "that's why all these companies are not giving guidance." Many people, however, are optimistic only for a vaccine, but also their thinking is young people with disposable income, they're going to kind of say,"Damn the torpedoes, "I'm not really going to be exposed." >> And they could come back much stronger, there seems to be pent up demand for some of the things like elective surgery, or even some other sort of more important, healthcare needs. So, that obviously could be a snapback. So, obviously we're really closely looking at this, one thing though is certain, is that people are expecting a permanent change, and you've got data that really shows that on the next chart. >> That's right. So, one of the last questions that we ask kind of this quick COVID Flash Poll was, do you anticipate permanent changes to your kind of IT stack, IT spend, based on the last few months? As everyone has been working remotely, and rarely do you see results point this much in one direction, but 92% of CIOs and kind of high level IT end users indicated yes, there are all going to be permanent changes. And one of the things we talked about in March, and look, we were really the first ones, in our discussion, where we were talking about work from home spend, kind of negating or bouncing out all these declines, right? We were saying, look, yes, we are seeing a lot of budgets come down, but surprisingly, we're seeing 20,30% of organizations accelerate spend. And even the ones that are spending less, even them, some of their budgets are kind of being negated by this work from home spend, right? When you think about collaboration tools and additional VPN and networking bandwidth, and laptops and then security, all that stuff. CIOs now continue to spend on, because what CIOs now understand is productivity has remained at very high levels, right? In March CIOs were very concerned with the catastrophe and productivity that has not come true. So on the margin CIOs and organizations are probably much more positive on that front. And so now, because there is no vaccine, where we know CIOs and just in general, the population, we don't know when one is coming. And so remote work seems to be the new norm moving forward, especially that productivity levels are pretty good with people working from home. So, from that perspective, everything that looked like it was maybe going to be temporary, just for the next few months, as people work from home, that's how organizations are now moving forward. >> Well, and we saw Twitter, basically said, "we're going to make work from home permanent." That's probably because their CEO wants to live in Africa. Google, I think, is going to the end of the year. >> I think many companies are going to look at a hybrid, and give employees a choice, say, "look, if you want to work from home "and you can be productive, you get your stuff done, we're cool with that." I think the other point is, everybody talks about these digital transformations leading into COVID. I got to tell you, I think a lot of companies were sort of complacent. They talk the talk, but they weren't walking the walk, meaning they really weren't becoming digital businesses. They really weren't putting data at the core. And I think now it's really becoming an imperative. And there's no question that what we've been talking about and forecasting has been pulled forward, and you're either going to have to step up your digital game or you're going to be in big trouble. And the other thing I'm really interested in is will companies sub-optimize profitability in the near term, in order to put better business resiliency in place, and better flexibility, will they make those investments? And I think if they do, longer term, they're going to be in better shape. If they don't, they could maybe be okay in the near term, but I'm going to put up a caution sign, although the longer term. >> Now look, I think everything that's been done in the last few months, in terms of having those continuation plans, due to pandemics and all that stuff, look, you got to have that in your playbook, right? And so to your point, this is where CIOs are going and if you're not transforming yourself or you didn't before, lesson learned, because now you're probably having to move twice as fast to support all your employees. So I think this pandemic really kind of sped up digital transformation initiatives, which is why, you're seeing some companies, SAS and Cloud related companies, with very good earnings reports that are guiding well. And then you're seeing other companies that are pulling their guidance because of uncertainty, but it's likely more on the side if they're just not seeing the same levels of spend, because if they haven't oriented themselves, on that digital transformation side. So I think events like this, they typically showcase winners and losers than when things are going well. and everything's kind of going up. >> Well, I think that too, there's a big discussion around is the S&P over valued right now. I won't make that call, but I will say this, that there's a lot of data out there. There's data in earnings reports, there's data about this pandemic, which it continues to change. Maybe not so much daily, but we're getting new information, multiple times a week. So you got to look to that data. You got to make your call, pick your spots, earlier you talk about a stock pickers market. I think it's very much true here. There are some going to be really strong companies. emerging out of this, don't gamble but do your research. And I think you'll find some gems out there, maybe Warren buffet can't find them okay. (laughs) But the guys at main street. I'm optimistic, I wonder how you feel about the recovery. I think I maybe tainted by tech. (laughs). I'm very much concerned about certain industries, but I think the tech industry, which is our business's, going to come out of this pretty strong? >> Yeah. Look, the one thing we should have stated this earlier, the majority of organizations are not expecting a V-shaped recovery. And yet I still think there's part of the consensus is expecting a V-shaped recovery. You can see as we demonstrate in some of the earlier charts, That U-shaped, there is some cautious optimism around there, almost the majority of organizations are expecting a U-shape recovery. And even then, as we mentioned, right? That U-shape, there is some cautious optimism around there, and I have it, you probably have it where. Yes, if everything goes well, it looks like 2021 we can really get back on track. But there's so much unknown. And so yes, that does give I think everyone pause when it comes from an investment perspective, and even just bringing on technologies. into your organization, right? Which ones are going to work, which ones aren't? So, I'm definitely on the boat of, this is a more U-shaped in a V-shape recovery. I think the data backs that up. I think when it comes to Cloud and SAS players, those areas, and I think you've seen this on the investment side, a lot of money has come out of all these other sectors that we mentioned that are having these L-shaped recoveries. A lot of it has gone into the text-based. I imagine that will continue. And so that might be kind of, it's tough to sometimes balance what's going on, on the investment that stock market side, with how organizations are recovering. I think people are really looking out into two, 3/4 and saying, look to your point where you said that earlier, is there a lot of that pent up demand, are things going to get right back to normal? Because I think a lot of people are anticipating that. And if we don't see that, I think the next time we do some of these kind of COVID Flash Polls I'm interested to see whether or not, maybe towards the end of the summer, these recovery cycles are actually longer because maybe we didn't see some of that stuff. So there's still a lot of unknowns. But what we do know right now is it's not a V-shaped recovery. >> I agree, especially on the unknowns, there's monetary policy, there's fiscal policy, there's an election coming up. >> That's fine. >> There's escalating tensions with China. There's your thoughts on the efficacy of the vaccine? what about therapeutics? Do people who've had this get immunity? How many people actually have it? What about testing? So the point I'm making here is it's very, very important that you update your forecast regularly That's why it's so great to have this partnership with you guys, because you're constantly updating the numbers. It's not just a one shot deal. So Sagar, thanks so much for coming on. I'm looking forward to having you on in the coming weeks. Really appreciate it. >> Absolutely. Yeah, we'll really start kind of digging into how a lot of these emerging technologies are fairing because of COVID-19. So, I'm actually interested to start digging through the data myself. So yeah, we'll do some reporting in the coming weeks about that as well. >> Well, thanks everybody for watching this episode of theCUBE Insights powered by ETR. I'm Dave Vellante for Sagar Kadakia, check out etr.plus, that's where all the ETR data lives, I publish weekly on wikibond.com and siliconangle.com. And you can reach me @dvellante. We'll see you next time. (gentle music).

ladies and gentlemen this is your captain speaking we will soon be taking off on our way to altitude please keep your seatbelts fastened and remain in your seats we will be experiencing turbulence until we are above the clouds ladies and gentlemen we are now cruising at altitude sit back and enjoy the ride [Music] altitude is a community of thought leaders and pioneers cloud architects and enlightened network engineers who have individually and are now collectively leading their own IT teams and the industry on a path to lift cloud networking above the clouds empowering Enterprise IT to architect design and control their own cloud network regardless of the turbulent clouds beneath them it's time to gain altitude ladies and gentlemen Steve Mulaney president and CEO of aviatrix the leader of multi cloud networking [Music] [Applause] all right good morning everybody here in Santa Clara as well as to the what millions of people watching the livestream worldwide welcome to altitude 2020 alright so we've got a fantastic event today really excited about the speakers that we have today and the experts that we have and really excited to get started so one of the things I wanted to just share was this is not a one-time event this is not a one-time thing that we're gonna do sorry for the aviation analogy but you know sherry way aviatrix means female pilot so everything we do as an aviation theme this is a take-off for a movement this isn't an event this is a take-off of a movement a multi-cloud networking movement and community that we're inviting all of you to become part of and-and-and why we're doing that is we want to enable enterprises to rise above the clouds so to speak and build their network architecture regardless of which public cloud they're using whether it's one or more of these public clouds so the good news for today there's lots of good news but this is one good news is we don't have any powerpoint presentations no marketing speak we know that marketing people have their own language we're not using any of that in those sales pitches right so instead what are we doing we're going to have expert panels we've got Simone Rashard Gartner here we've got 10 different network architects cloud architects real practitioners they're going to share their best practices and there are real-world experiences on their journey to the multi cloud so before we start and everybody know what today is in the u.s. it's Super Tuesday I'm not gonna get political but Super Tuesday there was a bigger Super Tuesday that happened 18 months ago and maybe eight six employees know what I'm talking about 18 months ago on a Tuesday every enterprise said I'm gonna go to the cloud and so what that was was the Cambrian explosion for cloud for the price so Frank kibrit you know what a Cambrian explosion is he had to look it up on Google 500 million years ago what happened there was an explosion of life where it went from very simple single-cell organisms to very complex multi-celled organisms guess what happened 18 months ago on a Tuesday I don't really know why but every enterprise like I said all woke up that day and said now I'm really gonna go to cloud and that Cambrian explosion of cloud went meant that I'm moving from very simple single cloud single use case simple environment to a very complex multi cloud complex use case environment and what we're here today is we're gonna go and dress that and how do you handle those those those complexities and when you look at what's happening with customers right now this is a business transformation right people like to talk about transitions this is a transformation and it's actually not just the technology transformation it's a business transformation it started from the CEO and the boards of enterprise customers where they said I have an existential threat to the survival of my company if you look at every industry who they're worried about is not the other 30 year old enterprise what they're worried about is the three year old enterprise that's leveraging cloud that's leveraging AI and that's where they fear that they're going to actually get wiped out right and so because of this existential threat this is CEO lead this is board led this is not technology led it is mandated in the organization's we are going to digitally transform our enterprise because of this existential threat and the movement to cloud is going to enable us to go do that and so IT is now put back in charge if you think back just a few years ago in cloud it was led by DevOps it was led by the applications and it was like I said before their Cambrian explosion is very simple now with this Cambrian explosion and enterprises getting very serious and mission critical they care about visibility they care about control they care about compliance conformance everything governance IT is in charge and and and that's why we're here today to discuss that so what we're going to do today is much of things but we're gonna validate this journey with customers did they see the same thing we're gonna validate the requirements for multi-cloud because honestly I've never met an enterprise that is not going to be multi-cloud many are one cloud today but they all say I need to architect my network for multiple clouds because that's just what the network is there to support the applications and the applications will run and whatever cloud it runs best in and you have to be prepared for that the second thing is is architecture again with IT in charge you architecture matters whether it's your career whether it's how you build your house it doesn't matter horrible architecture your life is horrible forever good architecture your life is pretty good so we're gonna talk about architecture and how the most fundamental and critical part of that architecture and that basic infrastructure is the network if you don't get that right nothing works right way more important and compute way more important than storm dense storage network is the foundational element of your infrastructure then we're going to talk about day 2 operations what does that mean well day 1 is one day of your life that's who you wire things up they do and beyond I tell everyone in networking and IT it's every day of your life and if you don't get that right your life is bad forever and so things like operations visibility security things like that how do I get my operations team to be able to handle this in an automated way because it's not just about configuring it in the cloud it's actually about how do I operationalize it and that's a huge benefit that we bring as aviatrix and then the last thing we're going to talk and it's the last panel we have I always say you can't forget about the humans right so all this technology all these things that we're doing it's always enabled by the humans at the end of the day if the humans fight it it won't get deployed and we have a massive skills gap in cloud and we also have a massive skill shortage you have everyone in the world trying to hire cloud network architects right there's just not enough of them going around so at aviatrix we as leaders do we're gonna help address that issue and try to create more people we created a program and we call the ACE program again an aviation theme it stands for aviatrix certified engineer very similar to what Cisco did with CCI ease where Cisco taught you about IP networking a little bit of Cisco we're doing the same thing we're gonna teach network architects about multi-cloud networking and architecture and yeah you'll get a little bit of aviatrix training in there but this is the missing element for people's careers and also within their organization so we're gonna we're gonna go talk about that so great great event great show when to try to keep it moving I'd next want to introduce my my host he's the best in the business you guys have probably seen him multiple million times he's the co CEO and co-founder of tube Jon Fourier okay awesome great great speech they're awesome I'd totally agree with everything you said about the explosion happening and I'm excited here at the heart of Silicon Valley to have this event it's a special digital event with the cube and aviatrix were we live streaming to millions of people as you said maybe not a million maybe not really take this program to the world this is a little special for me because multi-cloud is the hottest wave and cloud and cloud native networking is fast becoming the key engine of the innovation so we got an hour and a half of action-packed programming we have a customer panel two customer panels before that Gartner is going to come on talk about the industry we have a global system integrators we talk about how they're advising and building these networks and cloud native networking and then finally the Aces the aviatrix certified engineer is gonna talk more about their certifications and the expertise needed so let's jump right in and let's ask someone rashard to come on stage from Gartner check it all up [Applause] okay so kicking things off sitting started gartner the industry experts on cloud really kind of more to your background talk about your background before you got the gardener yeah before because gardener was a chief network architect of a fortune five companies with thousands of sites over the world and I've been doing everything and IT from a C programmer in a 92 a security architect to a network engineer to finally becoming a network analyst so you rode the wave now you're covering at the marketplace with hybrid cloud and now moving quickly to multi cloud is really was talking about cloud natives been discussed but the networking piece is super important how do you see that evolving well the way we see Enterprise adapt in cloud first thing you do about networking the initial phases they either go in a very ad hoc way is usually led by non non IT like a shadow I to your application people are some kind of DevOps team and it's it just goes as it's completely unplanned decreed VP sees left and right with different account and they create mesh to manage them and their direct connect or Express route to any of them so that's what that's a first approach and on the other side again it within our first approach you see what I call the lift and shift way we see like enterprise IT trying to basically replicate what they have in a data center in the cloud so they spend a lot of time planning doing Direct Connect putting Cisco routers and f5 and Citrix and any checkpoint Palo Alto divides that the audinate that are sent removing that to that cloud and I ask you the aha moments gonna come up a lot of our panels is where people realize that it's a multi cloud world I mean they either inherit clouds certainly they're using public cloud and on-premises is now more relevant than ever when's that aha moment that you're seeing where people go well I got to get my act together and get on this well the first but even before multi-cloud so these two approach the first one like the ad hoc way doesn't scale at some point idea has to save them because they don't think about the two they don't think about operations they have a bunch of VPC and multiple clouds the other way that if you do the left and shift wake they cannot take any advantages of the cloud they lose elasticity auto-scaling pay by the drink these feature of agility features so they both realize okay neither of these ways are good so I have to optimize that so I have to have a mix of what I call the cloud native services within each cloud so they start adapting like other AWS constructor is your construct or Google construct then that's what I call the optimal phase but even that they realize after that they are very different all these approaches different the cloud are different identities is completely difficult to manage across clouds I mean for example AWS has accounts there's subscription and in adarand GCP their projects it's a real mess so they realize well I can't really like concentrate use the cloud the cloud product and every cloud that doesn't work so I have I'm doing multi cloud I like to abstract all of that I still wanna manage the cloud from an API to interview I don't necessarily want to bring my incumbent data center products but I have to do that in a more API driven cloud they're not they're not scaling piece and you were mentioning that's because there's too many different clouds yes that's the piece there so what are they doing whether they really building different development teams as its software what's the solution well this the solution is to start architecting the cloud that's the third phase I call that the multi cloud architect phase where they have to think about abstraction that works across cloud fact even across one cloud it might not scale as well if you start having like 10,000 security group in AWS that doesn't scale you have to manage that if you have multiple VPC it doesn't scale you need a third party identity provider so it barely scales within one cloud if you go multiple cloud it gets worse and worse see way in here what's your thoughts I thought we said this wasn't gonna be a sales pitch for aviatrix you just said exactly what we do so anyway I'm just a joke what do you see in terms of where people are in that multi-cloud so a lot of people you know everyone I talked to started in one cloud right but then they look and they say okay but I'm now gonna move to adjourn I'm gonna move do you see a similar thing well yes they are moving but they're not there's not a lot of application that use a tree cloud at once they move one app in deserve one app in individuals one get happen Google that's what we see so far okay yeah I mean one of the mistakes that people think is they think multi-cloud no one is ever gonna go multi-cloud for arbitrage they're not gonna go and say well today I might go into Azure because I got a better rate of my instance that's never do you agree with that's never going to happen what I've seen with enterprise is I'm gonna put the workload in the app the app decides where it runs best that may be a sure maybe Google and for different reasons and they're gonna stick there and they're not gonna move let me ask you infrastructure has to be able to support from a networking team be able to do that do you agree with that yes I agree and one thing is also very important is connecting to that cloud is kind of the easiest thing so though while their network part of the cloud connectivity to the cloud is kind of simple I agree IPSec VP and I reckon Express that's a simple part what's difficult and even a provisioning part is easy you can use terraform and create v pieces and v nets across which free cloud providers right what's difficult is the day-to-day operations so it's what to find a to operations what is that what does that actually mean this is the day-to-day operations after you know the natural let's add an app let's add a server let's troubleshoot a problem so so your life something changes how would he do so what's the big concerns I want to just get back to this cloud native networking because everyone kind of knows with cloud native apps are that's been a hot trend what is cloud native networking how do you how do you guys define that because that seems to be the oddest part of the multi cloud wave that's coming as cloud native networking well there's no you know official garner definition but I can create one on and if another spot is do it I just want to leverage the cloud construct and a cloud epi I don't want to have to install like like for example the first version was let's put a virtual router that doesn't even understand and then the cloud environment right if I have if I have to install a virtual machine it has to be cloud aware it has to understand the security group if it's a router it has to be programmable to the cloud API and and understand the cloud environment you know one things I hear a lot from either see Saussure CIOs or CXOs in general is this idea of I'm definitely on going API so it's been an API economy so API is key on that point but then they say okay I need to essentially have the right relationship with my suppliers aka clouds you call it above the clouds so the question is what do i do from an architecture standpoint do I just hire more developers and have different teams because you mentioned that's a scale point how do you solve this this problem of okay I got AWS I got GCP or Azure or whatever do I just have different teams or just expose api's where is that optimization where's the focus well I take what you need from an android point of view is a way a control plane across the three clouds and be able to use the api of the cloud to build networks but also to troubleshoot them and do they to operation so you need a view across a three cloud that takes care of routing connectivity that's you know that's the aviatrix plug of you right there so so how do you see so again your Gartner you you you you see the industry you've been a network architect how do you see this this plane out what are the what are the legacy incumbent client-server on-prem networking people gonna do well these versus people like aviatrix well how do you see that plane out well obviously all the incumbent like Arista cisco juniper NSX right they want to basically do the lift and ship or they want to bring and you know VM I want to bring in a section that cloud they call that NSX everywhere and cisco monks bring you star and the cloud recall that each guy anywhere right so everyone what and and then there's cloud vision for my red star and contrail is in the cloud so they just want to bring the management plane in the cloud but it's still based most of them it's still based on putting a VM them in controlling them right you you extend your management console to the cloud that's not truly cloud native right cloud native you almost have to build it from scratch we like to call that cloud naive clown that so close one letter yeah so that was a big con surgeon reinvent take the tea out of cloud native it's cloud naive that went super viral you guys got t-shirts now I know you love but yeah but that really ultimately is kind of double edged sword you got to be you can be naive on the on the architecture side and rolling out but also suppliers are can be naive so how would you define who's naive and who's not well in fact they're evolving as well so for example in Cisco you it's a little bit more native than other ones because they're really scr in the cloud you can't you you really like configure API so the cloud and NSX is going that way and so is Arista but they're incumbent they have their own tools is difficult for them they're moving slowly so it's much easier to start from scratch Avenue like and you know a network happiness started a few years ago there's only really two aviatrix was the first one they've been there for at least three or four years and there's other ones like al kira for example that just started now that doing more connectivity but they wanna create an overlay network across the cloud and start doing policies and trying abstracting all the clouds within one platform so I gotta ask you I interviewed an executive at VMware Sanjay Pune and he said to me at RSA last week oh the only b2 networking vendors left Cisco and VMware what's your respect what's your response to that obviously I mean when you have these waves as new brands that emerge like aviation others though I think there'll be a lot of startups coming out of the woodwork how do you respond to that comment well there's still a data center there's still like a lot of action on campus and there's the one but from the cloud provisioning and clown networking in general I mean they're behind I think you know in fact you don't even need them to start to it you can if you're small enough you can just keep if you're in AWS you can user it with us construct they have to insert themselves I mean they're running behind they're all certainly incumbents I love the term Andy Jesse's that Amazon Web Services uses old guard new guard to talk about the industry what does the new guard have to do the new and new brands that emerge in is it be more DevOps oriented neck Nets a cops is that net ops is the programmability these are some of the key discussions we've been having what's your view on how you this programmability their most important part is they have to make the network's simple for the dev teams and from you cannot have that you cannot make a phone call and get every line in two weeks anymore so if you move to that cloud you have to make the cloud construct as simple enough so that for example a dev team could say okay I'm going to create this VP see but this VP see automatically being associate to your account you cannot go out on the internet you have to go to the transit VP see so there's a lot of action in terms of the I am part and you have to put the control around them too so to make it as simple as possible you guys both I mean you're the COC aviatrix but also you guys a lot of experience going back to networking going back to I call the OSI mace which for us old folks know what that means but you guys know what this means I want to ask you the question as you look at the future of networking here a couple of objectives oh the cloud guys they got networking we're all set with them how do you respond to the fact that networking is changing and the cloud guys have their own networking what some of the pain points that's going on premises and these enterprises so are they good with the clouds what needs what are the key things that's going on in networking that makes it more than just the cloud networking what's your take on well as I said earlier that once you you could easily provision in the cloud you can easily connect to that cloud is when you start troubleshooting application in the cloud and try to scale so this that's where the problem occurs see what you're taking on it and you'll hear from the from the customers that that we have on stage and I think what happens is all the cloud the clouds by definition designed to the 80/20 rule which means they'll design 80% of the basic functionality and they'll lead to 20% extra functionality that of course every Enterprise needs they'll leave that to ISVs like aviatrix because why because they have to make money they have a service and they can't have huge instances for functionality that not everybody needs so they have to design to the common and that's they all do it right they have to and then the extra the problem is that Cambrian explosion that I talked about with enterprises that's holy that's what they need that they're the ones who need that extra 20% so that's that's what I see is is there's always gonna be that extra functionality the in in an automated and simple way that you talked about but yet powerful with up with the visible in control that they expect of on prep that that's that kind of combination that yin and the yang that people like us are providing some I want to ask you were gonna ask some of the cloud architect customer panels it's the same question this pioneers doing some work here and there's also the laggers who come in behind the early adopters what's gonna be the tipping point what are some of those conversations that the cloud architects are having out there or what's the signs that they need to be on this multi cloud or cloud native networking trend what are some the signals that are going on in their environment what are some of the thresholds or things that are going on that there can pay attention to well well once they have application and multiple cloud and they have they get wake up at 2:00 in the morning to troubleshoot them they don't know it's important so I think that's the that's where the robber will hit the road but as I said it's easier to prove it it's ok it's 80s it's easy use a transit gateway put a few V PCs and you're done and use create some presents like equinox and do Direct Connect and Express route with Azure that looks simple is the operations that's when they'll realize ok now I need to understand our car networking works I also need a tool that give me visibility and control not button tell me that I need to understand the basic underneath it as well what are some of the day in the life scenarios that you envision happening with multi Bob because you think about what's happening it kind of has that same vibe of interoperability choice multi-vendor because you have multi clouds essentially multi vendor these are kind of old paradigms that we've lived through the client server and internet working wave what are some of those scenarios of success and that might be possible it would be possible with multi cloud and cloud native networking well I think once you have good enough visibility to satisfy your customers you know not only like to keep the service running an application running but to be able to provision fast enough I think that's what you want to achieve small final question advice for folks watching on the live stream if they're sitting there as a cloud architect or a CXO what's your advice to them right now in this more because honestly public cloud check hybrid cloud they're working on that that gets on-premise is done now multi clouds right behind it what's your advice the first thing they should do is really try to understand cloud networking for each of their cloud providers and then understand the limitation and is what there's cloud service provider offers enough or you need to look to a third party but you don't look at a third party to start with especially an incumbent one so it's tempting to say on and I have a bunch of f5 experts nothing against that five I'm going to bring my five in the cloud when you can use a needle be that automatically understand Easy's and auto scaling and so on and you understand that's much simpler but sometimes you need you have five because you have requirements you have like AI rules and that kind of stuff that you use for years you cannot do it's okay I have requirement and that met I'm going to use legacy stuff and then you have to start thinking okay what about visibility control about the tree cloud but before you do that you have to understand the limitation of the existing cloud providers so first try to be as native as possible until things don't work after that you can start taking multi-cloud great insight somewhat thank you for coming someone in charge with Gardner thanks for sharing informatica is known as the leading enterprise cloud data management company we are known for being the top in our industry in at least five different products over the last few years especially we've been transforming into a cloud model which allows us to work better with the trends of our customers in order to see agile and effective in the business you need to make sure that your products and your offerings are just as relevant in all these different clouds than what you're used to and what you're comfortable with one of the most difficult challenges we've always had is that because we're a data company we're talking about data that a customer owns some of that data may be in the cloud some of that data may be on Prem some of that data may be actually in their data center in another region or even another country and having that data connect back to our systems that are located in the cloud has always been a challenge when we first started our engagement with aviatrix we only had one plan that was Amazon it wasn't till later that a jerk came up and all of a sudden we found hey the solution we already had in place for her aviatrix already working in Amazon and now works in Missouri as well before we knew what GCP came up but it really wasn't a big deal for us because we already had the same solution in Amazon and integer now just working in GCP by having a multi cloud approach we have access to all three of them but more commonly it's not just one it's actually integrations between multiple we have some data and ensure that we want to integrate with Amazon we have some data in GCP that we want to bring over to a data Lake assure one of the nice things about aviatrix is that it gives a very simple interface that my staff can understand and use and manage literally hundreds of VPNs around the world and while talking to and working with our customers who are literally around the world now that we've been using aviatrix for a couple years we're actually finding that even problems that we didn't realize we had were actually solved even before we came across the problem and it just worked cloud companies as a whole are based on reputation we need to be able to protect our reputation and part of that reputation is being able to protect our customers and being able to protect more importantly our customers data aviatrix has been helpful for us in that we only have one system that can manage this whole huge system in a simple easy direct model aviatrix is directly responsible for helping us secure and manage our customers not only across the world but across multiple clouds users don't have to be VPN or networking experts in order to be able to use the system all the members on my team can manage it all the members regardless of their experience can do different levels of it one of the unexpected advantages of aviatrix is that I don't have to sell it to my management the fact that we're not in the news at 3 o'clock in the morning or that we don't have to get calls in the middle of the night no news is good news especially in networking things that used to take weeks to build or done in hours I think the most important thing about a matrix is it provides me a Beatrix gives me a consistent model that I can use across multiple regions multiple clouds multiple customers okay welcome back to altitude 2020 for the folks on the livestream I'm John for Steve Mulaney with CEO of aviatrix for our first of two customer panels on cloud with cloud network architects we got Bobby Willoughby they gone Luis Castillo of National Instruments David should Nick with fact set guys welcome to the stage for this digital event come on up [Applause] [Music] hey good to see you thank you okay okay customer panelist is my favorite part we get to hear the real scoop gets a gardener given this the industry overview certainly multi clouds very relevant and cloud native networking is the hot trend with a live stream out there and the digital event so guys let's get into it the journey is you guys are pioneering this journey of multi cloud and cloud native networking and is soon gonna be a lot more coming so we want to get into the journey what's it been like is it real you got a lot of scar tissue and what are some of the learnings yeah absolutely so multi cloud is whether or not we we accepted as a network engineers is is a reality like Steve said about two years ago companies really decided to to just to just bite the bullet and and and move there whether or not whether or not we we accept that fact we need to now create a consistent architecture across across multiple clouds and that that is challenging without orchestration layers as you start managing different different tool sets and different languages across different clouds so that's it's really important that to start thinking about that guys on the other panelists here there's different phases of this journey some come at it from a networking perspective some come in from a problem troubleshooting which what's your experiences yeah so from a networking perspective it's been incredibly exciting it's kind of a once-in-a-generation 'el opportunity to look at how you're building out your network you can start to embrace things like infrastructure as code that maybe your peers on the systems teams have been doing for years but it just never really worked on bram so it's really it's really exciting to look at all the opportunities that we have and then all the interesting challenges that come up that you that you get to tackle an effect said you guys are mostly AWS right yep right now though we're we are looking at multiple clouds we have production workloads running in multiple clouds today but a lot of the initial work has been with Amazon and you've seen it from a networking perspective that's where you guys are coming at it from yep we evolved more from a customer requirement perspective started out primarily as AWS but as the customer needed more resources from Azure like HPC you know as your ad things like that even recently Google Google Analytics our journey has evolved into more of a multi cloud environment Steve weigh in on the architecture because this has been the big conversation I want you to lead this second yeah so I mean I think you guys agree the journey you know it seems like the journey started a couple years ago got real serious the need for multi cloud whether you're there today of course it's gonna be there in the future so that's really important I think the next thing is just architecture I'd love to hear what you you know had some comments about architecture matters it all starts I mean every Enterprise I talk to maybe talk about architecture and the importance of architecture maybe Bobby it's a fun architecture perspective we sorted a journey five years ago Wow okay and we're just now starting our fourth evolution of our network marketer and we call it networking security net SEC yeah versus Justice Network yeah and that fourth generation architectures be based primarily upon Palo Alto Networks an aviatrix I have Atrix doing the orchestration piece of it but that journey came because of the need for simplicity ok the need for a multi cloud orchestration without us having to go and do reprogramming efforts across every cloud as it comes along right I guess the other question I also had around architectures also Louis maybe just talk about I know we've talked a little bit about you know scripting right and some of your thoughts on that yeah absolutely so so for us we started we started creating the network constructs with cloud formation and we've we've stuck with that for the most part what's interesting about that is today on premise we have a lot of a lot of automation around around how we provision networks but cloud formation has become a little bit like the new manual for us so we we're now having issues with having the to automate that component and making it consistent with our on premise architecture making it consistent with Azure architecture and Google cloud so it's really interesting to see to see companies now bring that layer of abstraction that SEO and brought to the to the web side now it's going up into into the into the cloud networking architecture so on the fourth generation of you mentioned you're in the fourth gen architecture what do you guys what have you learned is there any lessons scar tissue what to avoid what worked what was some of the that's probably the biggest list and there is that when you think you finally figured it out you have it right Amazon will change something as you or change something you know transit gateways a game changer so in listening to the business requirements is probably the biggest thing we need to do up front but I think from a simplicity perspective we like I said we don't want to do things four times we want to do things one time we won't be able to write to an API which aviatrix has and have them do the orchestration for us so that we don't have to do it four times how important is architecture in the progression is it you guys get thrown in the deep end to solve these problems or you guys zooming out and looking at it it's that I mean how are you guys looking at the architecture I mean you can't get off the ground if you don't have the network there so all of those that we've gone through similar evolutions we're on our fourth or fifth evolution I think about what we started off with Amazon without a direct connect gate without a trans a gateway without a lot of the things that are available today kind of the 80/20 that Steve was talking about just because it wasn't there doesn't mean we didn't need it so we needed to figure out a way to do it we couldn't say oh you need to come back to the network team in a year and maybe Amazon will have a solution for it right you need to do it now and in evolve later and maybe optimize or change the way you're doing things in the future but don't sit around and wait you can't I'd love to have you guys each individually answer this question for the live stream because it comes up a lot a lot of cloud architects out in the community what should they be thinking about the folks that are coming into this proactively and/or realizing the business benefits are there what advice would you guys give them an architecture what should be they be thinking about and what are some guiding principles you could share so I would start with looking at an architecture model that that can that can spread and and give consistency they're different to different cloud vendors that you will absolutely have to support cloud vendors tend to want to pull you into using their native toolset and that's good if only it was realistic to talk about only one cloud but because it doesn't it's it's it's super important to talk about and have a conversation with the business and with your technology teams about a consistent model how do I do my day one work so that I'm not you know spending 80 percent of my time troubleshooting or managing my network because I'm doing that then I'm missing out on ways that I can make improvements or embrace new technologies so it's really important early on to figure out how do I make this as low maintenance as possible so that I can focus on the things that the team really should be focusing on Bobby your advice the architect I don't know what else I can do that simplicity operations is key right all right so the holistic view of j2 operation you mentioned let's can jump in day one is your your your getting stuff set up day two is your life after all right this is kind of what you're getting at David so what does that look like what are you envisioning as you look at that 20 mile stare at post multi-cloud world what are some of the things that you want in a day to operations yeah infrastructure is code is really important to us so how do we how do we design it so that we can fit start making network changes and fitting them into like a release pipeline and start looking at it like that rather than somebody logging into a router seoi and troubleshooting things on in an ad hoc nature so moving more towards the DevOps model yes anything on that day - yeah I would love to add something so in terms of day 2 operations you can you can either sort of ignore the day 2 operations for a little while where you get well you get your feet wet or you can start approaching it from the beginning the fact is that the the cloud native tools don't have a lot of maturity in that space and when you run into an issue you're gonna end up having a bad day going through millions and millions of logs just to try to understand what's going on so that's something that that the industry just now is beginning to realize it's it's such as such a big gap I think that's key because for us we're moving to more of an event-driven operations in the past monitoring got the job done it's impossible to modern monitor something there's nothing there when the event happens all right so the event-driven application and then detection is important yeah I think Gardiner was all about the cloud native wave coming into networking that's going to be here thing I want to get your guys perspectives I know you have different views of how you came on into the journey and how you're executing and I always say the beauties in the eye of the beholder and that kind of applies the network's laid out so Bobby you guys do a lot of high-performance encryption both on AWS and Azure that's kind of a unique thing for you how are you seeing that impact with multi cloud yeah and that's a new requirement for us to where we we have a requirement to encrypt and they never get the question should I encryption or not encrypt the answer is always yes you should encrypt when you can encrypt for our perspective we we need to migrate a bunch of data from our data centers we have some huge data centers and then getting that data to the cloud is the timely expense in some cases so we have been mandated that we have to encrypt everything leave from the data center so we're looking at using the aviatrix insane mode appliances to be able to encrypt you know 10 20 gigabits of data as it moves to the cloud itself David you're using terraform you got fire Ned you've got a lot of complexity in your network what do you guys look at the future for yours environment yeah so something exciting that or yeah now is fire net so for our security team they obviously have a lot of a lot of knowledge base around Palo Alto and with our commitments to our clients you know it's it's it's not very easy to shift your security model to a specific cloud vendor right so there's a lot of stuck to compliance of things like that where being able to take some of what you've you know you've worked on for years on Bram and put it in the cloud and have the same type of assurance that things are gonna work and be secured in the same way that they are on prem helps make that journey into the cloud a lot easier and Louis you guys got scripting and get a lot of things going on what's your what's your unique angle on this yeah no absolutely so full disclosure I'm not a not not an aviatrix customer yet it's okay we want to hear the truth that's good Ellis what are you thinking about what's on your mind no really when you when you talk about implementing the tool like this it's really just really important to talk about automation and focus on on value so when you talk about things like encryption and things like so you're encrypting tunnels and crypting the path and those things are it should it should should be second nature really when you when you look at building those back ends and managing them with your team it becomes really painful so tools like a Beatrix that that add a lot of automation it's out of out of sight out of mind you can focus on the value and you don't have to focus on so I gotta ask you guys I'll see aviatrix is here they're their supplier to this sector but you guys are customers everyone's pitching you stuff people are not going to buy my stuff how do you guys have that conversation with the suppliers like the cloud vendors and other folks what's that what's it like we're API all the way you got to support this what are some of the what are some of your requirements how do you talk to and evaluate people that walk in and want to knock on your door and pitch you something what's the conversation like it's definitely it's definitely API driven we we definitely look at the at the PAP i structure of the vendors provide before we select anything that that is always first in mind and also what a problem are we really trying to solve usually people try to sell or try to give us something that isn't really valuable like implementing a solution on the on the on the cloud isn't really it doesn't really add a lot of value that's where we go David what's your conversation like with suppliers you have a certain new way to do things as as becomes more agile and essentially the networking and more dynamic what are some of the conversation is with the either incumbents or new new vendors that you're having what do what do you require yeah so ease of use is definitely definitely high up there we've had some vendors come in and say you know hey you know when you go to set this up we're gonna want to send somebody on site and they're gonna sit with you for your day to configure it and that's kind of a red flag what wait a minute you know do we really if one of my really talented engineers can't figure it out on his own what's going on there and why is that so I you know having having some ease-of-use and the team being comfortable with it and understanding it is really important Bobby how about you I mean the old days was do a bake-off and you know the winner takes all I mean is it like that anymore but what's the Volvic a bake-off last year for us do you win so but that's different now because now when you when you get the product you can install the product and they double your energy or have it in a matter of minutes and so the key is is they can you be operational you know within hours or days instead of weeks but but do we also have the flexibility to customize it to meet your needs could you want to be you want to be put into a box with the other customers when you have needs that your pastor cut their needs yeah almost see the challenge that you guys are living where you've got the cloud immediate value depending how you can roll up any solutions but then you have might have other needs so you got to be careful not to buy into stuff that's not shipping so you're trying to be proactive at the same time deal with what you got I mean how do you guys see that evolving because multi-cloud to me is definitely relevant but it's not yet clear how to implement across how do you guys look at this baked versus you know future solutions coming how do you balance that so again so right now we we're we're taking the the ad hoc approach and experimenting with the different concepts of cloud and and really leveraging the the native constructs of each cloud but but there's a there's a breaking point for sure you don't you don't get to scale this like Alexa mom said and you have to focus on being able to deliver a developer they're their sandbox or they're their play area for the for the things that they're trying to build quickly and the only way to do that is with the with with some sort of consistent orchestration layer that allows you to so use a lot more stuff to be coming pretty quickly hides area I do expect things to start to start maturing quite quite quickly this year and you guys see similar trend new stuff coming fast yeah part of the biggest challenge we've got now is being able to segment within the network being able to provide segmentation between production on production workloads even businesses because we support many businesses worldwide and and isolation between those is a key criteria there so the ability to identify and quickly isolate those workloads is key so the CIOs that are watching or that are saying hey take that he'll do multi cloud and then you know the bottoms-up organization Nick pops you're kind of like off a little bit it's not how it works I mean what is the reality in terms of implementing you know in as fast as possible because the business benefits are but it's not always clear in the technology how to move that fast yeah what are some of the barriers one of the blockers what are the enablers I think the reality is is that you may not think you're multi-cloud but your business is right so I think the biggest barriers there is understanding what the requirements are and how best to meet those requirements and then secure manner because you need to make sure that things are working from a latency perspective that things work the way they did and get out of the mind shift that you know it was a cheery application in the data center it doesn't have to be a Tier three application in the cloud so lift and shift is is not the way to go yeah scale is a big part of what I see is the competitive advantage to a lot these clouds and needs to be proprietary network stacks in the old days and then open systems came that was a good thing but as clouds become bigger there's kind of an inherent lock in there with the scale how do you guys keep the choice open how're you guys thinking about interoperability what are some of the conversations and you guys are having around those key concepts well when we look at when we look at the upfront from a networking perspective it it's really key for you to just enable enable all the all the clouds to be to be able to communicate between them developers will will find a way to use the cloud that best suits their their business need and and like like you said it's whether whether you're in denial or not of the multi cloud fact that then your company is in already that's it becomes really important for you to move quickly yeah and I a lot of it also hinges on how well is the provider embracing what that specific cloud is doing so are they are they swimming with Amazon or Azure and just helping facilitate things they're doing the you know the heavy lifting API work for you or are they swimming upstream and they're trying to hack it all together in a messy way and so that helps you you know stay out of the lock-in because they're you know if they're doing if they're using Amazon native tools to help you get where you need to be it's not like Amazon's gonna release something in the future that completely you know makes you have designed yourself into a corner so the closer they're more than cloud native they are the more the easier it is to to deploy but you also need to be aligned in such a way that you can take advantage of those cloud native technologies will it make sense tgw is a game changer in terms of cost and performance right so to completely ignore that would be wrong but you know if you needed to have encryption you know teach Adobe's not encrypted so you need to have some type of a gateway to do the VPN encryption you know so the aviatrix tool give you the beauty of both worlds you can use tgw with a gateway Wow real quick in the last minute we have I want to just get a quick feedback from you guys I hear a lot of people say to me hey the I picked the best cloud for the workload you got and then figure out multi cloud behind the scenes so that seems to be do you guys agree with that I mean is it do I go Mull one cloud across the whole company or this workload works great on AWS that work was great on this from a cloud standpoint do you agree with that premise and then witness multi-cloud stitch them all together yeah from from an application perspective it it can be per workload but it can also be an economical decision certain enterprise contracts will will pull you in one direction that value but the the network problem is still the same doesn't go away yeah yeah yeah I mean you don't want to be trying to fit a square into a round Hall right so if it works better on that cloud provider then it's our job to make sure that that service is there and people can use it agree you just need to stay ahead of the game make sure that the network infrastructure is there secure is available and is multi cloud capable yeah I'm at the end of the day you guys just validating that it's the networking game now cloud storage compute check networking is where the action is awesome thanks for your insights guys appreciate you coming on the panel appreciate it thanks thank you [Applause] [Music] [Applause] okay welcome back on the live feed I'm John fritz T Blaney my co-host with aviatrix I'm with the cube for the special digital event our next customer panel got great another set of cloud network architects Justin Smith was aura Justin broadly with Ellie Mae and Amit Oh tree job with Koopa welcome to stage [Applause] all right thank you thank you okay he's got all the the cliff notes from the last session welcome back rinse and repeat yeah yeah we're going to go under the hood a little bit I think I think they nailed the what we've been reporting and we've been having this conversation around networking is where the action is because that's the end of the day you got a move a pack from A to B and you get workloads exchanging data so it's really killer so let's get started Amit what are you seeing as the journey of multi cloud as you go under the hood and say okay I got to implement this I have to engineer the network make it enabling make it programmable make it interoperable across clouds and that's like I mean almost sounds impossible to me what's your take yeah I mean it it seems impossible but if you are running an organization which is running infrastructure as a cordon all right it is easily doable like you can use tools out there that's available today you can use third-party products that can do a better job but but put your architecture first don't wait architecture may not be perfect put the best architecture that's available today and be agile to iterate and make improvements over the time we get to Justin's over here so I have to be careful when I point a question in Justin they both have the answer but okay journeys what's the journey been like I mean is there phases we heard that from Gartner people come in to multi cloud and cloud native networking from different perspectives what's your take on the journey Justin yeah I mean from our perspective we started out very much focused on one cloud and as we started doing errands we started doing new products the market the need for multi cloud comes very apparent very quickly for us and so you know having an architecture that we can plug in play into and be able to add and change things as it changes is super important for what we're doing in the space just in your journey yes for us we were very ad hoc oriented and the idea is that we were reinventing all the time trying to move into these new things and coming up with great new ideas and so rather than it being some iterative approach with our deployments that became a number of different deployments and so we shifted that tore in the network has been a real enabler of this is that it there's one network and it touches whatever cloud we want it to touch and it touches the data centers that we need it to touch and it touches the customers that we need it to touch our job is to make sure that the services that are available and one of those locations are available in all of the locations so the idea is not that we need to come up with this new solution every time it's that we're just iterating on what we've already decided to do before we get the architecture section I want to ask you guys a question I'm a big fan of you know let the app developers have infrastructure as code so check but having the right cloud run that workload I'm a big fan of that if it works great but we just heard from the other panel you can't change the network so I want to get your thoughts what is cloud native networking and is that the engine really that's the enabler for this multi cloud trend but you guys taken we'll start with Amit what do you think about that yeah so you are gonna have workloads running in different clouds and the workloads would have affinity to one cloud over other but how you expose that it matter of how you are going to build your networks how we are gonna run security how we are going to do egress ingress out of it so it's a big problem how do you split says what's the solution what's the end the key pain points and problem statement I mean the key pain point for most companies is how do you take your traditionally on-premise network and then blow that out to the cloud in a way that makes sense you know IP conflicts you have IP space you pub public eye peas and premise as well as in the cloud and how do you kind of make a sense of all of that and I think that's where tools like a v8 ryx make a lot of sense in that space from our site it's it's really simple its latency its bandwidth and availability these don't change whether we're talking about cloud or data center or even corporate IT networking so our job when when these all of these things are simplified into like s3 for instance and our developers want to use those we have to be able to deliver that and for a particular group or another group that wants to use just just GCP resources these aren't we have to support these requirements and these wants as opposed to saying hey that's not a good idea our job is to enable them not to disable them do you think you guys think infrastructure is code which I love that I think it's that's the future it is we saw that with DevOps but I do start getting the networking is it getting down to the network portion where it's network is code because storage and compute working really well is seeing all kubernetes and service master and network as code reality is it there is got work to do it's absolutely there I mean you mentioned net DevOps and it's it's very real I mean in Cooper we build our networks through terraform and on not only just out of fun build an API so that we can consistently build V nets and VPC all across in the same unit yeah and even security groups and then on top an aviatrix comes in we can peer the networks bridge bridge all the different regions through code same with you guys but yeah everything we deploy is done with automation and then we also run things like lambda on top to make changes in real time we don't make manual changes on our network in the data center funny enough it's still manual but the cloud has enabled us to move into this automation mindset and and all my guys that's what they focus on is bringing what now what they're doing in the cloud into the data center which is kind of opposite of what it should be that's full or what it used to be it's full DevOps then yes yeah I mean for us was similar on-premise still somewhat very manual although we're moving more Norton ninja and terraform concepts but everything in the production environment is colored Confirmation terraform code and now coming into the datacenter same I just wanted to jump in on a Justin Smith one of the comment that you made because it's something that we always talk about a lot is that the center of gravity of architecture used to be an on-prem and now it's shifted in the cloud and once you have your strategic architecture what you--what do you do you push that everywhere so what you used to see at the beginning of cloud was pushing the architecture on prem into cloud now I want to pick up on what you said to you others agree that the center of architect of gravity is here I'm now pushing what I do in the cloud back into on pram and and then so first that and then also in the journey where are you at from 0 to 100 of actually in the journey to cloud DUI you 50% there are you 10% yes I mean are you evacuating data centers next year I mean were you guys at yeah so there's there's two types of gravity that you typically are dealing with no migration first is data gravity and your data set and where that data lives and then the second is the network platform that interrupts all that together right in our case the data gravity sold mostly on Prem but our network is now extending out to the app tier that's going to be in cloud right eventually that data gravity will also move to cloud as we start getting more sophisticated but you know in our journey we're about halfway there about halfway through the process we're taking a handle of you know lift and shift and when did that start and we started about three years ago okay okay go by it's a very different story it started from a garage and one hundred percent on the clock it's a business spend management platform as a software-as-a-service one hundred percent on the cloud it was like ten years ago right yes yeah you guys are riding the wave love that architecture Justin I want to ask user you guys mentioned DevOps I mean obviously we saw the huge observability wave which is essentially network management for the cloud in my opinion right yeah it's more dynamic but this isn't about visibility we heard from the last panel you don't know what's being turned on or turned off from a services standpoint at any given time how is all this playing out when you start getting into the DevOps down well this this is the big challenge for all of us as visibility when you talk transport within a cloud you know we very interesting we we have moved from having a backbone that we bought that we own that would be data center connectivity we now I work for as or as a subscription billing company so we want to support the subscription mindset so rather than going and buying circuits and having to wait three months to install and then coming up with some way to get things connected and resiliency and redundancy I my backbone is in the cloud I use the cloud providers interconnections between regions to transport data across and and so if you do that with their native solutions you you do lose visibility there are areas in that that you don't get which is why controlling you know controllers and having some type of management plane is a requirement for us to do what we're supposed to do and provide consistency while doing it a great conversation I loved when you said earlier latency bandwidth I think availability with your sim pop3 things guys SLA I mean you just do ping times between clouds it's like you don't know what you're getting for round-trip times this becomes a huge kind of risk management black hole whatever you want to call blind spot how are you guys looking at the interconnects between clouds because you know I can see that working from you know ground to cloud I'm per cloud but when you start doing with multi clouds workload I mean SL leis will be all over the map won't they just inherently but how do you guys view that yeah I think we talked about workload and we know that the workloads are going to be different in different clouds but they are going to be calling each other so it's very important to have that visibility that you can see how data is flowing at what latency and what our ability is hour is there and our authority needs to operate on that so it's solely use the software dashboard look at the times and look at the latency in the old days strong so on open so on you try to figure it out and then your day is you have to figure out just and what's your answer to that because you're in the middle of it yeah I mean I think the the key thing there is that we have to plan for that failure we have to plan for that latency and our applications it's starting start tracking in your SLI something you start planning for and you loosely couple these services and a much more micro services approach so you actually can handle that kind of failure or that type of unknown latency and unfortunately the cloud has made us much better at handling exceptions a much better way you guys are all great examples of cloud native from day one and you guys had when did you have the tipping point moment or the Epiphany of saying a multi clouds real I can't ignore it I got to factor it into all my design design principles and and everything you're doing what's it was there a moment or was it was it from day one now there are two divisions one was the business so in business there was some affinity to not be in one cloud or to be in one cloud and that drove from the business side so it has a cloud architect our responsibility was to support that business and other is the technology some things are really running better in like if you are running dot network load or you are going to run machine learning or AI so that you have you would have that preference of one cloud over other so it was the bill that we got from AWS I mean that's that's what drives a lot of these conversations is the financial viability of what you're building on top of it which is so we this failure domain idea which is which is fairly interesting is how do I solve or guarantee against a failure domain you have methodologies with you know back-end direct connects or interconnect with GCP all of these ideas are something that you have to take into account but that transport layer should not matter to whoever we're building this for our job is to deliver the frames in the packets what that flows across how you get there we want to make that seamless and so whether it's a public internet API call or it's a back-end connectivity through Direct Connect it doesn't matter it just has to meet a contract that you signed with your application folks yeah that's the availability piece just on your thoughts on that I think any comment on that so actually multi clouds become something much more recent in the last six to eight months I'd say we always kind of had a very much an attitude of like moving to Amazon from our private cloud is hard enough why complicate it further but the realities of the business and as we start seeing you know improvements in Google and Asia and different technology spaces the need for multi cloud becomes much more important as well as those are acquisition strategies I matured we're seeing that companies that used to be on premise that we typically acquire are now very much already on a cloud and if they're on a cloud I need to plug them into our ecosystem and so that's really change our multi cloud story in a big way I'd love to get your thoughts on the clouds versus the clouds because you know you compare them Amazon's got more features they're rich with features I see the bills are haiku people using them but Google's got a great Network Google's networks pretty damn good and then you got a sure what's the difference between the clouds who where they've evolved something whether they peak in certain areas better than others what what are the characteristics which makes one cloud better do they have a unique feature that makes Azure better than Google and vice versa what do you guys think about the different clouds yeah to my experience I think there is the approach is different in many places Google has a different approach very devops friendly and you can run your workload like your network can spend regions time I mean but our application ready to accept that MS one is evolving I mean I remember ten years back Amazon's network was a flat network we will be launching servers and 10.0.0.0 mode multi-account came out so they are evolving as you are at a late start but because they have a late start they saw the pattern and they they have some mature set up on the I mean I think they're all trying to say they're equal in their own ways I think they all have very specific design philosophies that allow them to be successful in different ways and you have to kind of that in mine is your architectural and solution for example Amazon has a very much a very regional affinity they don't like to go cross region in their architecture whereas Google is very much it's a global network we're gonna think about as a global solution I think Google also has advantages there to market and so it has seen what asier did wrong it's seen what AWS did wrong and it's made those improvements and I think that's one of their big advantage at great scale to Justin thoughts on the cloud so yeah Amazon built from the system up and Google built from the network down so their ideas and approaches are from a global versus or regional I agree with you completely that that is the big number one thing but the if you look at it from the outset interestingly the the inability or the ability for Amazon to limit layer 2 broadcasting and and what that really means from a VPC perspective changed all the routing protocols you can use all the things that we have built inside of a data center to provide resiliency and and and make things seamless to users all of that disappeared and so because we had to accept that at the VPC level now we have to accept it at the LAN level Google's done a better job of being able to overcome those things and provide those traditional Network facilities to us it's just great panel can go all day here's awesome so I heard we could we'll get to the cloud native naive question so kind of think about what's not even what's cloud is that next but I got to ask you had a conversation with a friend he's like when is the new land so if you think about what the land was at a data center when is the new link you get talking about the cloud impact so that means st when the old st was kind of changing into the new land how do you guys look at that because if you think about it what lands were for inside a premises was all about networking high speed but now when you take the win and make essentially a land do you agree with that and how do you view this trend and is it good or bad or is it ugly and what's what you guys take on this yeah I think it's the it's a thing that you have to work with your application architect so if you are managing networks and if you're a sorry engineer you need to work with them to expose the unreliability that would bring in so the application has to hand a lot of this the difference in the Layton sees and and the reliability has to be worked through the application there land when same concept as it be yesterday I think we've been talking about for a long time the erosion of the edge and so is this is just a continuation of that journey we've been on for the last several years as we get more and more cloud native when we start about API is the ability to lock my data in place and not be able to access it really goes away and so I think this is just continuation that thing I think it has challenges we start talking about weighing scale versus land scale the tooling doesn't work the same the scale of that tooling is much larger and the need to automation is much much higher in a way than it was in a land that's what we're seeing so much infrastructure as code yeah yeah so for me I'll go back again to this its bandwidth and its latency right that bet define those two land versus win but the other thing that's comes up more and more with cloud deployments is where is our security boundary and where can I extend this secure aware appliance or set of rules to protect what's inside of it so for us we're able to deliver VRS or route forwarding tables for different segments wherever we're at in the world and so they're they're trusted to talk to each other but if they're gonna go to someplace that's outside of their their network then they have to cross a security boundary and where we enforce policy very heavily so for me there's it's not just land when it's it's how does environment get to environment more importantly that's a great point and security we haven't talked to yet but that's got to be baked in from the beginning that's architecture thoughts on security are you guys are dealing with it yeah start from the base have app to have security built in have TLS have encryption on the data I transit data at rest but as you bring the application to the cloud and they are going to go multi-cloud talking to over the Internet in some places well have apt web security I mean I mean our principals day Security's day zero every day and so we we always build it into our design we load entire architecture into our applications it's encrypt everything it's TLS everywhere it's make sure that that data is secured at all times yeah one of the cool trends at RSA just as a side note was the data in use encryption piece which is a homomorphic stuff was interesting all right guys final question you know we heard on the earlier panel was also trending at reinvent we take the tea out of cloud native it spells cloud naive okay they got shirts now he being sure he's gonna got this trend going what does that mean to be naive so if you're to your peers out there watching a live stream and also the suppliers that are trying to you know supply you guys with technology and services what's naive look like and what's native look like when is someone naive about implementing all this stuff so for me it's because we are in hundred-percent cloud for us its main thing is ready for the change and you will you will find new building blocks coming in and the network design will evolve and change so don't be naive and think that it's static you wall with the change I think the big naivety that people have is that well I've been doing it this way for twenty years and been successful it's going to be successful in cloud the reality is that's not the case you have to think some of the stuff a little bit differently and you need to think about it early enough so that you can become cloud native and really enable your business on cloud yeah for me it's it's being open minded right the the our industry the network industry as a whole has been very much I am smarter than everybody else and we're gonna tell everybody how it's going to be done and we have we fell into a lull when it came to producing infrastructure and and and so embracing this idea that we can deploy a new solution or a new environment in minutes as opposed to hours or weeks or four months in some cases is really important and and so you know it's are you being closed-minded native being open-minded exactly and and it took a for me it was that was a transformative kind of where I was looking to solve problems in a cloud way as opposed to looking to solve problems in this traditional old-school way all right I know we're out of time but I ask one more question so you guys so good it could be a quick answer what's the BS language when you the BS meter goes off when people talk to you about solutions what's the kind of jargon that you hear that's the BS meter going off what are people talking about that in your opinion you here you go that's total B yes what what triggers use it so that I have two lines out of movies that are really I can if the if I say them without actually thinking them it's like 1.21 jigowatts how you're out of your mind from Back to the Future right somebody's gonna be a bank and then and then Martin ball and and Michael Keaton and mr. mom when he goes to 22 21 whatever it takes yeah those two right there if those go off in my mind somebody's talking to me I know they're full of baloney so a lot of speeds would be a lot of speeds and feeds a lot of data did it instead of talking about what you're actually doing and solutioning for you're talking about well I does this this this and okay 220 221 anytime I start seeing the cloud vendor start benchmarking against each other it's your workload is your workload you need to benchmark yourself don't don't listen to the marketing on that that's that's all I'm a what triggers you and the bsp I think if somebody explains you a not simple they cannot explain you in simplicity then that's a good one all right guys thanks for the great insight great panel how about a round of applause practitioners DX easy solutions integrating company than we service customers from all industry verticals and we're helping them to move to the digital world so as a solutions integrator we interface with many many customers that have many different types of needs and they're on their IT journey to modernize their applications into the cloud so we encounter many different scenarios many different reasons for those migrations all of them seeking to optimize their IT solutions to better enable their business we have our CPS organization it's cloud platform services we support AWS does your Google Alibaba corkle will help move those workloads to wherever it's most appropriate no one buys the house for the plumbing equally no one buys the solution for the networking but if the plumbing doesn't work no one likes the house and if this network doesn't work no one likes a solution so network is ubiquitous it is a key component of every solution we do the network connectivity is the lifeblood of any architecture without network connectivity nothing works properly planning and building a scalable robust network that's gonna be able to adapt with the application needs its when encountering some network design and talking about speed the deployment aviatrix came up in discussion and we then further pursued an area DHT products that incorporated aviatrix is part of a new offering that we are in the process of developing that really enhances our ability to provide cloud connectivity for the lance cloud connectivity there's a new line of networking services that we're getting into as our clients move into hybrid cloud networking it is much different than our traditional based services an aviatrix provides a key component in that service before we found aviatrix we were using just native peering connections but there wasn't a way to visualize all those peering connections and with multiple accounts multiple contacts for security with a v8 church we were able to visualize those different peering connections of security groups it helped a lot especially in areas of early deployment scenarios were quickly able to then take those deployment scenarios and turn them into scripts that we can then deploy repeatedly their solutions were designed for work with the cloud native capabilities first and where those cloud native capabilities fall short they then have solution sets that augment those capabilities I was pleasantly surprised number one with the aviatrix team as a whole in their level of engagement with us you know we weren't only buying the product we were buying a team that came on board to help us implement and solution that was really good to work together to learn both what aviatrix had to offer as well as enhancements that we had to bring that aviatrix was able to put into their product and meet our needs even better aviatrix was a joy to find because they really provided us the technology that we needed in order to provide multi cloud connectivity that really added to the functionality that you can't get from the basic law providing services we're taking our customers on a journey to simplify and optimize their IT infrastructure aviatrix certainly has made my job much easier okay welcome back to altitude 2020 for the digital event for the live feed welcome back I'm John Ford with the cube with Steve Mulaney CEO aviatrix for the next panel from global system integrators the folks who are building and working with folks on their journey to multi cloud and cloud native networking we've got a great panel George Buckman with dxc and Derek Monahan with wwt welcome to the stage [Applause] [Music] okay you guys are the ones out there advising building and getting down and dirty with multi cloud and cloud native networking we heard from the customer panel you can see the diversity of where people come into the journey of cloud it kind of depends upon where you are but the trends are all clear cloud native networking DevOps up and down the stack this has been the main engine what's your guys take of the disk journey to multi cloud what do you guys seeing yeah it's it's critical I mean we're seeing all of our enterprise customers enter into this they've been through the migrations of the easy stuff you know now they're trying to optimize and get more improvement so now the tough stuffs coming on right and you know they need their data processing near where their data is so that's driving them to a multi cloud environment okay we heard some of the edge stuff I mean you guys are exactly you've seen this movie before but now it's a whole new ballgame what's your take yeah so I'll give you a hint so our practice it's not called the cloud practice it's the multi cloud practice and so if that gives you a hint of how we approach things it's very consultative and so when we look at what the trends are let's look a little year ago about a year ago we were having conversations with customers let's build a data center in the cloud let's put some VP C's let's throw some firewalls with some DNS and other infrastructure out there and let's hope it works this isn't a science project so what we're trying we're starting to see is customers are starting to have more of a vision and we're helping with that consultative nature but it's totally based on the business and you got to start understanding how the lines of business are using the apps and then we evolved into that next journey which is a foundational approach to what are some of the problem statement customers are solving when they come to you what are the top things that are on their my house or the ease of use of jelly all that stuff but what specifically they did digging into yeah some complexity I think when you look at multi cloud approach in my view is network requirements are complex you know I think they are but I think the approach can be let's simplify that so one thing that we try to do and this is how we talk to customers is let's just like you simplify an aviatrix simplifies the automation orchestration of cloud networking we're trying to simplify the design the planning implementation of infrastructure across multiple workloads across multiple platforms and so the way we do it is we sit down we look at not just use cases and not just the questions in common we anticipate we actually build out based on the business and function requirements we build out a strategy and then create a set of documents and guess what we actually build in the lab and that lab that we platform we built proves out this reference architecture actually works absolutely we implement similar concepts I mean we they're proven practices they work great so well George you mentioned that the hard part is now upon us are you referring to networking what is specifically were you getting at Tara so the easy parts done now so for the enterprises themselves migrating their more critical apps or more difficult apps into the environments you know they've just we've just scratched the surface I believe on what enterprises that are doing to move into the cloud to optimize their environments to take advantage of the scale and speed to deployment and to be able to better enable their businesses so they're just now really starting the >> so do you get you guys see what I talked about them in terms of their Cambrian explosion I mean you're both monster system integrators with you know top fortune enterprise customers you know really rely on you for for guidance and consulting and so forth and boy they're networks is that something that you you've seen I mean does that resonate did you notice a year and a half ago and all of a sudden the importance of cloud for enterprise shoot up yeah I mean we're seeing it okay in our internal environment as yeah you know we're a huge company or right customer zero or an IT so we're experiencing that internal okay and every one of our other customers so I have another question oh I don't know the answer to this and the lawyer never asks a question that you don't know the answer to but I'm gonna ask it anyway d XE @ wwt massive system integrators why aviatrix yep so great question Steve so I think the way we approach things I think we have a similar vision a similar strategy how you approach things how we approach things that it worldwide technology number one we want to simplify the complexity and so that's your number one priorities let's take the networking but simplify it and I think part of the other point I'm making is we have we see this automation piece as not just an afterthought anymore if you look at what customers care about visibility and automation is probably the at the top three maybe the third on the list and I think that's where we see the value and I think the partnership that we're building and what I what I get excited about is not just putting yours in our lab and showing customers how it works it's Co developing a solution with you figuring out hey how can we make this better right mr. piller is a huge thing Jenna insecurity alone Network everything's around visibility what automation do you see happening in terms of progression order of operations if you will it's the low-hanging fruit what are people working on now and what are what are some of the aspirational goals around when you start thinking about multi cloud and automation yep so I wanted to get back to answer that question I want to answer your question you know what led us there and why aviatrix you know in working some large internal IT projects and and looking at how we were going to integrate those solutions you know we like to build everything with recipes where Network is probably playing catch-up in the DevOps world but with a DevOps mindset looking to speed to deploy support all those things so when you start building your recipes you take a little of this a little of that and you mix it all together well when you look around you say wow look there's this big bag of a VHS let me plop that in that solves a big part of my problems that I have to speed to integrate speed to deploy and the operational views that I need to run this so that was 11 years about reference architectures yeah absolutely so you know they came with a full slate of reference architectures already the out there and ready to go that fit our needs so it's very very easy for us to integrate those into our recipes what do you guys think about all the multi vendor interoperability conversations that have been going on choice has been a big part of multi cloud in terms of you know customers want choice didn't you know they'll put a workload in the cloud that works but this notion of choice and interoperability is become a big conversation it is and I think our approach and that's why we talk to customers is let's let's speed and be risk of that decision making process and how do we do that because the interoperability is key you're not just putting it's not just a single vendor we're talking you know many many vendors I mean think about the average number of cloud applications a customer uses a business and enterprise business today you know it's it's above 30 it's it's skyrocketing and so what we do and we look at it from an Billy approaches how do things interoperate we test it out we validate it we build a reference architecture it says these are the critical design elements now let's build one with aviatrix and show how this works with aviatrix and I think the the important part there though is the automation piece that we add to it invisibility so I think the visibility is what's what I see lacking across the industry today and the cloud needed that's been a big topic yep okay in terms of aviatrix that you guys see them coming in there one of the ones that are emerging and the new brands emerging with multi cloud you still got the old guard incumbents with huge footprints how our customers dealing with that that kind of component in dealing with both of them yeah I mean where we have customers that are ingrained with a particular vendor and you know we have partnerships with many vendors so our objective is to provide the solution that meets that client and you they all want multi vendor they all want interoperability correct all right so I got to ask you guys a question while we were defining de to operations what does that mean I mean you guys are looking at the big business and technical components of architecture what does de two operations mean what's the definition of that yeah so I think from our perspective my experience we you know de to operations whether it's it's not just the you know the orchestration piece and setting up and let it a lot of automate and have some you know change control you're looking at this from a data perspective how do I support this ongoing and make it easy to make changes as we evolve that the the cloud is very dynamic the the nature of how that fast is expanding the number of features is astonishing trying to keep up to date with a number of just networking capabilities and services that are added so I think day to operation starts with a fundable understanding of you know building out supporting a customer's environments and making it the automation piece easy from from you know a distance I think yeah and you know taking that to the next level of being able to enable customers to have catalog items that they can pick and choose hey I need this network connectivity from this cloud location back to this on pram and being able to have that automated and provisioned just simply by ordering it for the folks watching out there guys take a minute to explain as you guys are in the trenches doing a lot of good work what are some of the engagement that you guys get into how does that progress what is that what's what happens there they call you up and say hey I need multi-cloud or you're already in there I mean take us through why how someone can engage to use a global si to come in and make this thing happen what's looks like typical engagement look like yeah so from our perspective we typically have a series of workshops in a methodology that we kind of go along the journey number one we have a foundational approach and I don't mean foundation meaning the network foundation that's a very critical element we got a factor in security we got a factor in automation so we think about foundation we do a workshop that starts with education a lot of times we'll go in and we'll just educate the customer what does VPC sharing you know what is a private link and Azure how does that impact your business you know customers I want to share services out in an ecosystem with other customers and partners well there's many ways to accomplish that so our goal is to you know understand those requirements and then build that strategy with them thoughts George oh yeah I mean I'm one of the guys that's down in the weeds making things happen so I'm not the guy on the front line interfacing with the customers every day but we have a similar approach you know we have a consulting practice that will go out and and apply their practices to see what those and when do you parachute in yeah when I then is I'm on the back end working with our offering development leads for the networking so we understand or seeing what customers are asking for and we're on the back end developing the solutions that integrate with our own offerings as well as enable other customers to just deploy quickly to meet their connectivity needs it so the patterns are similar great final question for you guys I want to ask you to paint a picture of what success looks like and you know for name customers you don't forget in reveal of kind of who they are but what does success look like in multi-cloud as you as you paint a picture for the folks here and watching on the live stream it's if someone says hey I want to be multi-cloud I got to have my operations agile I want full DevOps I want programmability security built in from day zero what does success look like yeah I think success looks like this so when you're building out a network the network is a harder thing to change than some other aspects of cloud so what we think is even if you're thinking about that second cloud which we have most of our customers are on to public clouds today they might be dabbling in that is you build that network foundation an architecture that takes in consideration where you're going and so once we start building that reference architecture out that shows this is how to sit from a multi-cloud perspective not a single cloud and let's not forget our branches let's not forget our data centers let's not forget how all this connects together because that's how we define multi-cloud it's not just in the cloud it's on Prem and it's off Prem and so collectively I think the key is also is that we provide them an hld you got to start with in a high-level design that can be tweaked as you go through the journey but you got to give a solid structural foundation and that networking which we think most customers think as not not the network engineers but as an afterthought we want to make that the most critical element before you start the journey Jorge from your seed had a success look for you so you know it starts out on these journeys often start out people not even thinking about what is gonna happen what what their network needs are when they start their migration journey to the cloud so I want this success to me looks like them being able to end up not worrying about what's happening in the network when they move to the cloud good guys great insight thanks for coming on share and pen I've got a round of applause the global system integrators [Applause] [Music] okay welcome back from the live feed I'm shuffle with the cube Steve Eleni CEO of aviatrix my co-host our next panel is the aviatrix certified engineers also known as aces this is the folks that are certified their engineering they're building these new solutions please welcome Toby Foster min from Attica Stacy linear from Terra data and Jennifer Reid with Victor Davis to the stage I was just gonna I was just gonna rip you guys and say where's your jackets and Jen's got the jacket on okay good love the aviatrix aces pile of gear there above the clouds soaring to new heights that's right so guys aviatrix aces love the name I think it's great certified this is all about getting things engineered so there's a level of certification I want to get into that but first take us through the day in the life of an ace and just to point out Stacey's a squad leader so he's like a squadron leader Roger and leader yeah squadron leader so he's got a bunch of aces underneath him but share your perspective day-in-the-life Jeff we'll start with you sure so I have actually a whole team that works for me both in the in the North America both in the US and in Mexico and so I'm eagerly working to get them certified as well so I can become a squad leader myself but it's important because one of the the critical gaps that we've found is people having the networking background because they're you graduate from college and you have a lot of computer science background you can program you've got Python but networking in packets they just don't get and so just taking them through all the processes that it's really necessary to understand when you're troubleshooting is really critical mm-hmm and because you're gonna get an issue where you need to figure out where exactly is that happening on the network you know is my my issue just in the V PCs and on the instant side is a security group or is it going on print and this is something actually embedded within Amazon itself I mean I should troubleshot an issue for about six months going back and forth with Amazon and it was the vgw VPN because they were auto-scaling on two sides and we ended up having to pull out the Cisco's and put in aviatrix so I could just say okay it's fixed and actually actually helped the application teams get to that and get it solved yeah but I'm taking a lot of junior people and getting them through that certification process so they can understand and see the network the way I see the network I mean look I've been doing this such for 25 years but I got out when I went in the Marine Corps that's what I did and coming out the network is still the network but people don't get the same training they get they got in the 90s it's just so easy just write some software and they work takes care of itself yes I'll be will get I'll come back to that I want to come back to that that problem solved with Amazon but Toby I think the only thing I have to add to that is that it's always the network fault as long as I've been in network have always been the network's fault and I'm even to this day you know it's still the network's fault and part of being a network guy is that you need to prove when it is and when it's not your fault and that means you need to know a little bit about a hundred different things to make that and now you got a full stack DevOps you gotta know a lot more times another hundred and these times are changing yeah they say you're a squadron leader I get that right what is what does a squadron leader first can you describe what it is I think probably just leading all the network components of it but not they from my perspective when to think about what you asked them was it's about no issues and no escalation soft my day is a good that's a good day yes it's a good day Jennifer you mentioned the Amazon thing this brings up a good point you know when you have these new waves come in you have a lot of new things newly use cases a lot of the finger-pointing it's that guy's problem that girl's problem so what is how do you solve that and how do you get the young guns up to speed is there training is that this is where the certification comes in well is where the certification is really going to come in I know when we we got together at reinvent one of the the questions that that we had with Stephen the team was what what should our certification look like you know she would just be teaching about what aviatrix troubleshooting brings to bear but what should that be like and I think Toby and I were like no no no that's going a little too high we need to get really low because the the better someone can get at actually understanding what actually happening in the network and and where to actually troubleshoot the problem how to step back each of those processes because without that it's just a big black box and they don't know you know because everything is abstracted in Amazon Internet and Azure and Google is substracted and they have these virtual gateways they have VPNs that you just don't have the logs on it's you just don't know and so then what tools can you put in front of them of where they can look because there are full logs well as long as we turned on the flow logs when they built it you know and there's like each one of those little things that well if they had decided to do that when they built it it's there but if you can come in later to really supplement that with training to actual troubleshoot and do a packet capture here as it's going through then teaching them how to read that even yeah Toby we were talking before we came on up on stage about your career you've been networking all your time and then you know you're now entering a lot of younger people how is that going because the people who come in fresh they don't have all the old war stories they don't know you talk about you know that's dimmer fault I walk in bare feet in the snow when I was your age I mean it's so easy now right they say what's your take on how you train the young P so I've noticed two things one is that they are up to speed a lot faster in generalities of networking they can tell you what a network is in high school level now where I didn't learn that too midway through my career and they're learning it faster but they don't necessarily understand why it's that way or you know everybody thinks that it's always slash 24 for a subnet and they don't understand why you can break it down smaller why it's really necessary so the the ramp up speed is much faster for these guys that are coming in but they don't understand why and they need some of that background knowledge to see where it's coming from and why is it important and old guys that's where we thrive Jennifer you mentioned you you got in from the Marines health spa when you got into networking how what was it like then and compared it now almost like we heard earlier static versus dynamic don't be static cuz then you just set the network you got a perimeter yeah no there was no such thing ya know so back in the day I mean I mean we had banyan vines for email and you know we had token ring and I had to set up token ring networks and figure out why that didn't work because how many of things were actually sharing it but then actually just cutting fiber and running fiber cables and dropping them over you know shelters to plug them in and oh crap they swung it too hard and shattered it now I gotta be great polished this thing and actually shoot like to see if it works I mean that was the network crimped five cat5 cables to run an Ethernet you know and then from that just said network switches dumb switches like those were the most common ones you had then actually configuring routers and you know logging into a Cisco router and actually knowing how to configure that and it was funny because I had gone all the way up and was a software product manager for a while so I've gone all the way up the stack and then two and a half three years ago I came across to to work with entity group that it became Victor Davis but we went to help one of our customers Davis and it was like okay so we need to fix the network okay I haven't done this in 20 years but all right let's get to it you know because it really fundamentally does not change it's still the network I mean I've had people tell me well you know when we go to containers we will not have to worry about the network and I'm like yeah you don't I do and then with this were the program abilities it really interesting so I think this brings up the certification what are some of the new things that people should be aware of that come in with the aviatrix ace certification what are some of the highlights can you guys share some of the some of the highlights around the certifications I think some of the importance is that it's it doesn't need to be vendor specific for network generality or basic networking knowledge and instead of learning how Cisco does something or how Palo Alto does something we need to understand how and why it works as a basic model and then understand how each vendor has gone about that problem and solved it in a general that's true in multi cloud as well you can't learn how cloud networking works without understanding how a double u.s. senator and GCP are all slightly the same but slightly different and some things work and some things don't I think that's probably the number one take I think having a certification across clouds is really valuable cuz we heard the global si help the business issues what does it mean to do that is it code is that networking is it configuration is that aviatrix what is the I mean op C aviatrix is the ASA certification but what is it about the multi cloud that makes it multi networking and multi vendor easy answer is yes so you got to be a generalist getting your hands and all you have to be right it takes experience because it's every every cloud vendor has their own certification whether that's hops and advanced networking and advanced security or whatever it might be yeah they can take the test but they have no idea how to figure out what's wrong with that system and the same thing with any certification but it's really getting your hands in there and actually having to troubleshoot the problems you know actually work the problem you know and calm down it's going to be okay I mean because I don't know how many calls I've been on or even had aviatrix join me on it's like okay so everyone calm down let's figure out what's happening it's like we've looked at that screen three times looking at it again it's not gonna solve that problem right but at the same time you know remaining calm but knowing that it really is I'm getting a packet from here to go over here it's not working so what could be the problem you know and actually stepping them through with those scenarios but that's like you only get that by having to do it you know and seeing it and going through it and then I have a question so we you know I just see it we started this program maybe months ago we're seeing a huge amount of interest I mean we're oversubscribed on all the training sessions we've got people flying from around the country even with coronavirus flying to go to Seattle to go to these events were oversubscribed good is that watching leader would put there yeah is that something that you see in your organization's are you recommending that to people do you see I mean I'm just I guess I'm surprised I'm not surprised but I'm really surprised by the demand if you would of this multi cloud network certification because it really isn't anything like that is that something you guys can comment on or do you see the same things in your organization's I say from my side because we operate in the multi cloud environment so it really helps and it's beneficial for us yeah I think I would add that uh networking guys have always needed to use certifications to prove that they know what they know right it's not good enough to say yeah I know IP addresses or I know how a network works and a couple little check marks or a little letters buying helps give you validity um so even in our team we can say hey you know we're using these certifications to know that you know enough of the basics and enough of the understandings that you have the tools necessary right so I guess my final question for you guys is why an eighth certification is relevant and then second part is share what the livestream folks who aren't yet a certified or might want to jump in to be AVH or certified engineers why is it important so why is it relevant and why shouldn't someone want to be an ace-certified I'm uses the right engineer I think my views a little different I think certification comes from proving that you have the knowledge not proving that you get a certification to get no I mean they're backwards so when you've got the training and the understanding and the you use that to prove and you can like grow your certification list with it versus studying for a test to get a certification and have no understanding of ok so that who is the right person that look at this is saying I'm qualified is it a network engineer is it a DevOps person what's your view you know is it a certain you know I think cloud is really the answer it's the as we talked like the edge is getting eroded so is the network definitions eating eroded we're getting more and more of some network some DevOps some security lots and lots of security because network is so involved in so many of them that's just the next progression there I would say I expand that to more automation engineers because we have those now probably extended as well well I think that the training classes themselves are helpful especially the entry-level ones for people who may be quote-unquote cloud architects but I've never done anything and networking for them to understand why we need those things to really work whether or not they go through to eventually get a certification is something different but I really think fundamentally understanding how these things work it makes them a better architect makes them better application developer but even more so as you deploy more of your applications into the cloud really getting an understanding even from our people who have tradition down on Prem networking they can understand how that's going to work in the cloud - well I know we've got just under 30 seconds left I want to get one more question than just one more for the folks watching that are maybe younger that don't have that networking training from your experiences each of you can answer why is it should they know about networking what's the benefit what's in it for them motivate them share some insights and why they should go a little bit deeper in networking Stacey we'll start with you we'll go down I'd say it's probably fundamental right if you don't deliver solutions networking use the very top I would say if you fundamental of an operating system running on a machine how those machines talk together as a fundamental change is something that starts from the base and work your way up right well I think it's a challenge because you you've come from top down now you're gonna start looking from bottom up and you want those different systems to cross communicate and say you built something and you're overlapping IP space not that that doesn't happen but how can I actually make that still operate without having to reappear e-platform it's like those challenges like those younger developers or sis engineers can really start to get their hands around and understand those complexities and bring that forward in their career they got to know the how the pipes are working and because know what's going some plumbing that's right and the works a how to code it that's right awesome thank you guys for great insights ace certified engineers also known as aces give a round of applause thank you okay all right that concludes my portion thank you Steve thanks for have Don thank you very much that was fantastic everybody round of applause for John Currier yeah so great event great event I'm not going to take long we've got we've got lunch outside for that for the people here just a couple of things just call to action right so we saw the Aces you know for those of you out on the stream here become a certified right it's great for your career it's great for knowledge is is fantastic it's not just an aviatrix thing it's gonna teach you about cloud networking multi-cloud networking with a little bit of aviatrix exactly what the Cisco CCIE program was for IP network that type of the thing that's number one second thing is is is is learn right so so there's a there's a link up there for the four to join the community again like I started this this is a community this is the kickoff to this community and it's a movement so go to what a v8 community bh6 comm starting a community at multi cloud so you know get get trained learn I'd say the next thing is we're doing over a hundred seminars in across the United States and also starting into Europe soon will come out and will actually spend a couple hours and talk about architecture and talk about those beginning things for those of you on the you know on the livestream in here as well you know we're coming to a city near you go to one of those events it's a great way to network with other people that are in the industry as well as to start to learn and get on that multi-cloud journey and then I'd say the last thing is you know we haven't talked a lot about what aviatrix does here and that's intentional we want you you know leaving with wanting to know more and schedule get with us in schedule a multi our architecture workshop session so we we sit out with customers and we talk about where they're at in that journey and more importantly where they're going in that in-state architecture from networking compute storage everything and everything you heard today every panel kept talking about architecture talking about operations those are the types of things that we saw we help you cook define that canonical architecture that system architecture that's yours so for so many of our customers they have three by five plotted lucid charts architecture drawings and it's the customer name slash aviatrix arc network architecture and they put it on their whiteboard that's what what we and that's the most valuable thing they get from us so this becomes their twenty-year network architecture drawing that they don't do anything without talking to us and look at that architecture that's what we do in these multi hour workshop sessions with customers and that's super super powerful so if you're interested definitely call us and let's schedule that with our team so anyway I just want to thank everybody on the livestream thank everybody here hopefully it was it was very useful I think it was and joined the movement and for those of you here join us for lunch and thank you very much [Applause] [Music]

>> Announcer: Live from Las Vegas, it's The Cube, covering AWS re:Invent 2019 brought to you by Amazon Web Services and Intel along with its ecosystem partners. >> Welcome back to Las Vegas, everybody. You're watching The Cube. We go out to the events and we extract the signal from the noise. My name is Dave Velante and I'm excited to have Veeam on the program. Good friend Rick Vanover is here. Rick, it's great to see you again. >> Thanks, Dave. >> He's the Senior Director of Product Strategy at Veeam, and Jim Kruger is the newly minted CMO. Jim, good to see you, thank for coming on. >> Great, thank you Dave. Thanks for having us. >> All right, so, let's talk about re:Invent. You guys are well known in the VMware community of course. Now the cloud comes in, you guys rose like a rocket ship with virtualization. Now cloud's here. How's the show going for you? What are the conversations like? >> Yeah, it's great. I mean, this is a continuation of the relationship that we have with AWS. We were a global sponsor and one of five companies represented in the global summit so that was a lead up to this. >> Which was today, this morning the partner summit, or the earlier partner summit. >> No, throughout the whole year. There's 30 different locations throughout the world that we sponsored and so that was a really good entry into this new audience for us in terms of new buyers and so forth. And re:Invent is huge. I mean, you can't even walk in the hallways out there. Our booth has been packed and just some really good conversations. We had a great announcement as a part of the show, so it's going great. >> Let's talk about that for sure. So, give us the update on 2019. You guys hit the billion dollar milestone. We covered you at VeeamON. We've been there for the last couple years, so congratulations on that. >> Jim: Thank you. Which of course is challenging because you're doing a lot more annual recurring revenue. You're still able to break through that billion dollar mark but give us an update on 2019. >> Yeah, so far so good, it's going well. We're going through a transition here. We call it act one to act two. And act one was really the foundation of the company focusing on virtual environments. Act two is really moving into the cloud and also moving from perpetual to subscription. And so we're going through that transition as we speak and we're finding really good success. We're really letting the market dictate that transition. We're not really forcing things on customers, but we had a really good Q3. We grew our annual recurring revenue by 24%. Our enterprise business is actually the fastest growing business within Veeam. It's growing at, it grew 20% year over year. And our alliances are really on fire. Year over year for our alliances, for our resellers, we have four of them, grew 92%. So, we're outgrowing the market significantly, continuing to gain market share. We're still number one in Europe and number four globally but catching up quick. >> So, Rick, when I first was introduced to Veeam I think it was at some VeeamUG somewhere, like "It's an interesting name, who are these guys?" And then saw you guys take off and it coincided with a big simplification theme and better resource allocation. We got all this wasted server capacity. But the problem was when we consolidated all those servers we now had less utilization or less capacity to drive things like backup which was a compute-hungry workload. You guys figured that out from a product standpoint. You simplified things and you took off. So, check, great job. Now there's cloud, so what's different about cloud? You guys have some announcements. What are you doing to take advantage of the cloud? >> Well so, our cloud journey, Dave, is starting but it's actually evolving from some technologies that have been out for a while. So, actually earlier this year, this isn't new, but we implemented a technology that puts data into the cloud which is a very important first step. Back up data into the cloud, very transparent, very easy to do with Veeam, but everything is different in the cloud. I think the plumbing is different. The use cases are different. The expectations of customers are different. So, when we look at how we're going to go into a market from a product standpoint, my team works with Jim's team as well as the product management team on this very purposefully, but the thought is we need to put in the right platform and the right capabilities for the cloud. So, that's the big news today here at AWS re:Invent and yesterday. We had a great session today where we showed off the new product being back up for AWS. And we have been through a lot of iterations on how we're going to get to this milestone. And I'm really stoked that it was available for this event, live in the marketplace. And I think about why we're going to go with this new product now this way. Ratmir, our co-founder, likes to say he wants to capture the hearts and minds of IT pros, and this product will do it. File level recovery, free edition, easy, it just works. Whatever you want to save, we've got it in this product. So, I'm really hoping that this will be the year of an additional disruption as we kick off act two that Jim mentioned. >> You guys have always been feature-rich. I was sharing with your audience the spending data that I have access to and when you look at it, when you look at spending momentum it shows some of the new guys, obviously you wouldn't be surprised. You're seeing some people experimenting, and okay, that's cool. And then some of the legacy guys you see, they're hanging on to the install base. Veeam interestingly is right there with the leaders but really consistent spending momentum for years. And so my question is, how is that, why are you able to sustain that momentum over time? What is your unique approach? >> Yeah, I mean I think there's a couple of key factors there that we've done as a business. One of the key strategies of the company is to remain agnostic and to build partnerships. And so one of the key strategies that we've had over the past few years is to work with partners. And so we've done go to markets, some engineering work, and as I mentioned in Q3 alone we saw 92% year over year growth and so that's helping us to drive growth. We've added some new products and so we have backup for Microsoft Office 365, which is a whole new market for us. And we're seeing tremendous growth there year over year, so that's helping us to keep steady. And then just the innovation engine. The development team that we have is one of the reasons why I joined Veeam, is because of the innovation and the development team and how they approach the market in terms of really focusing on the user and building products that aren't just a check box but they're products that add a tremendous amount of value. And so, we have a new, we made announcements here with specifically with AWS, but to continue our innovation track we have a new release that's coming out in the January timeframe called Version 10 which adds another 150 plus capabilities. And so, I think that's one of the biggest reasons we continue to add value to the system and to our customers. We're adding between three to four thousand new customers a month and our customer count is continuing to, we're at 365 thousand customers today and growing fast. >> So, Rick, I wonder if you can talk from a product standpoint. I said virtualization, I'm generalizing in cloud. There's specific things for VMware obviously that you do and I presume the same thing for cloud. What's unique about, well, first of all your relationship with AWS and what's unique about making your software work in the AWS ecosystem? >> Well, the unique part is really our go to market of partnering first. I like to say that partnership is in Veeam's DNA. We sell through the channel and we have the alliance relationships. We have the platform relationships like AWS as well as other clouds. And the thought here is that by going in software only I am actually completely convinced we're very well positioned in the market to come in with a solution that will work for literally everybody no matter what their preference, what brands of technology they use, what clouds they use. And so I think about what becomes interesting, what becomes unique with that. And I'll give you an Amazon example and this is something that's coming in the Version 10 that Jim alluded to. Amazon has a capability called object lock which can be used for immutable backups or immutable data. We're using it for backups and that's something that we're going to leverage in our upcoming release that is actually going to be a huge thing, a huge amount of capabilities where organizations can have their backup data resilient against ransomware, resilient against malicious admins, insider threats or accidental deletion. And that is only possible in the cloud. So, we're walking into a situation where Veeam, if we're going to leverage S3 and some of these capabilities provided by Amazon, along with our laser-focused approach for backups, we're going to give the market some things that honestly it'd be really hard to say no to. >> So, can you talk more about that immutability capability? Timestamp that and then go across the old stuff? >> It's smarter than a timestamp. Actually the thought here is that there's this governance and compliance mode that comes with AWS S3 storage which is a property of a bucket that's set at the top level. And from a API standpoint when an ISV like Veeam wants to put data into S3, that along with a lot of other elements of the consumption of the storage can be set. And what we're doing is we're actually working backwards into the user interface, and if I want to put my backup data into S3, I'm actually going to say make this data immutable, meaning unable to be deleted or changed. Or actually you can't change in S3, it's only a delete. But anyways, you can't delete it. So, the thought is I'm going to put, I'm just going to make up an example, Dave, seven days into S3, mark it as immutable. No matter what, that data can not be removed. >> You got a policy on it. >> Yeah, and it's there, it will not be deleted. No ransomware, no malicious admin, no insider threat. And then we're doing it with a lot of API intelligence so it's very efficient on how it goes in there and shared metadata. We just did a session on part of that today and we're going to have a huge splash event in January where we take it to the market. So, if anybody listening is going to be concerned about ransomware, Veeam has a technology that's evolving for you. >> So, I can set my RPO to whatever I want based on my objectives for the business, the cost equation. >> Yeah, and it's actually transparent to that. To me, it's a restore point but I have this ability to sleep at night because I know that it's in Amazon and it's object locked and I can't do anything to it. >> Yeah, but that was seven days ago, so I now want to update it. So, you've set a policy to say, okay. >> So, yeah, so that the eighth day the backup will go and day one will drop and then we'll be at two through eight. And then the next day three through nine. It will just, it will be a window of sorts. And the best part is, Dave, it's going to be transparent. It's in the user interface. It's a restore point and the ease of use. I look at the product team and we really have this mantra. Simple, reliable, flexible, and who doesn't want those types of capabilities in a product today? And actually it works backwards. So, one of our co-founders, Andre, like's to say, his expectation is somebody can download the product and do their first backup within ten minutes without using the manual. The ease of use has to be like that and with the newest product from Monday we're doing it again. >> So, Jim, I wonder if I could ask you about messaging. It's interesting, it was interesting to see at VeeamON. You guys got back to basics. There's a lot of money flowing into the data protection industry. You're still seeing new startups. Storage overall is a little soft right now because the cloud's eating away at the big guys, but data protection is still pretty hot as evidenced by some of the spending data that I talked about. A lot of guys talking about data management. You talk about data management, too, but you got back to the basics at VeeamON. You talked about it starts with backup. I wonder if you can talk about that messaging and then how that does relate to some of the new use cases. And you mentioned some, but what's your point of view there? >> Yeah, absolutely, so, yeah so, that is a key initiative for us in 2020 is to shift the pure speeds and feeds and features and talk more about use cases. As you'll see that come out and across our portfolio, that's one of our key marketing initiatives, but yeah. The messaging we did back in 2018, I think we over-rotated a little bit and focused a little bit too much on the enterprise and as you know our business is very spread across multiple segments. From SMB to commercial to enterprise. And enterprises is of course the key market that we want to go after but we have this great business at the lower end of the market which I think is unique and a differentiator for Veeam in terms of the number of customers that we have and the customer base that we have. So, what we've done is gone back to using words like backup because there's budget for backup. And that's a word that people automatically know what it means. You don't want to get too cute about it. So, we've come out with a new campaign around cloud data management, "Backup for what's next", and we're pushing that really hard because I think a lot of people know Veeam as the virtual leader and now we're moving into the cloud area so it's important for us to position the company to not only virtual but virtual, physical and cloud. And so you're going to see a lot more push into the cloud with the new solutions we're launching and pushing that hard in 2020. >> Now, Veeam's always had strong no BS engineering. You know the tagline, "It just works." It's true, you talk to your customers. And it's interesting, when you go to VeeamON, I've been to several, you're right. I mean, you've got guys there that are loyal to Veeam. They may not be huge buyers just in terms of ASPs, but there's a zillion of them and they're very loyal. And I think it's very smart strategy. You just keep moving up markets. You guys are like Steady Eddie. Give us, last question is 2020, what should we expect from you guys? You got VeeamON, The Cube is going to be there. We're excited, it's always a fun show. You get a passionate crowd. >> Yeah, so we have some exciting announcements that we're going to be making in the first of the year and in the mid part of the year which we think are going to be game changers and continue us on the trajectory of growth. So, we're very excited about that and yeah, continuing to focus on satisfying our customers. We're super proud of our net promoter score of 75, which is three times, three and a half times the industry and so keeping that momentum going with our customers is critically important. >> Well, guys, congratulations on all your success. Great, you mentioned your NPS. Great customer loyalty, the billion dollar milestone. Ratmir is on, he's on the record last year at VeeamON saying, "Hey, no, we're open to IPO." So, we'll be watching that and we'll ask him. We won't hit you with that. But guys, thanks so much for coming on. >> All right, thank you, Dave. >> Dave: Jim, Rick, good to see you. >> Thank you. >> And thank you, everybody, for watching. This is The Cube, live from AWS re:Invent 2019 from Las Vegas. We'll be right back right after this short break.