>> Announcer: From New York, it's theCUBE. Covering Blockchain Week. Now, here's John Furrier. >> Hello, I'm John Furrier, here in New York City, for on the ground coverage of Consensus 2018, it's part of Blockchain Week, New York. All the action's happening here, sold out show, tons of events happening in New York City. You got the New York City crowd, you got the Hollywood crowd, you got the tech crowd, all kind of coming together, entrepreneurs, the entire ecosystem. My next guest I Lars Rensing, who's the co-founder of Arc.io, its own blockchain, its own coin, CFO. Thanks for joining me today. >> Thanks John for having me here. >> So your signs everywhere I see, Arc.io, you're a big sponsor, top-tier sponsor. Congratulations. >> Thanks, thanks. >> Why sponsoring this event? >> Because it's a big event, lots of commitments, lots of people will be here, lots of important people are in this space, so like this is a good area to be and show ourselves more. >> You guys have a lot of traction with your offering, your project. Can you take a minute to explain Arc, >> Yeah sure. >> What is it? What is Arc coin, what's the development plans? You have multiple moving parts to this opportunity. Take a minute to explain. >> So what we're trying to build is the interoperability between blockchains, because we see that every use case probably needs their own blockchain, otherwise, you get one single point of failure. Where you you see them clogging up, old projects watered down because we have more blockchain. So every use case should have their own blockchain really. >> And also blockchain has different developer ecosystems too. You might want to have certain developers, like JavaScript might like Hyperledger, right? >> Yeah, exactly. Once every, like that's also what we are building with our SDKs, every developer in their own language, getting into blockchain is important, because there are not that much blockchain developers at all >> What's going on now? Obviously you guys are a blockchain platform. Developers really are engaging. What's your strategy with developers? >> So far we are working on our new V2. We started from scratch because we saw some limitations in our code, so okay, we needed to start from scratch, build a new V2, and we are internal testing that right now and working on that. >> Do you guys publish your roadmap? >> We publish a roadmap but we don't give dates. (John chuckles) Because we feel like we launch when it's ready, not when we set a date. We launch when it's ready. >> What's the community like for Arc? What's it like, what's the vibe? >> Really good, really commitment, working together. We're working actively with the community because we ask feedback from them. Like, with the V2 when we publish, okay, we're going to work on this project or on a V2, we ask community what's your feedback on it, and we actively took feedback from them and made it into the, in our development. So you're the CFO and co-founder, and you got a lot of co-founders, I know you got some other co-founders. >> Yeah. >> But I just love having a CFO that's not talking speeds and feeds on the spreadsheet. You also know the technology, you're in the community. I've been saying on theCUBE many times now that a new role's emerging in these companies of Chief Economic Officer. >> Yeah. >> 'Cause the token economics and the developer, there's interplay now between the business and the technology. Can you talk about that? >> Yeah sure. When we started, we really looked into the economics, how are we going to build it, how are we going to look into our Arc, the token is economize. How are people going to use it. So we saw that if you do an infinite supply of new tokens, because people are burning money. In this space it's still, insecure to sometimes lose you best basis. So money is still burnt. So you need some inflation to keep running your tokenization. >> You guys have an ecosystem? >> Yeah. >> What is your ecosystem strategy? You have developers. >> Yeah. >> Anyone else in the ecosystem that's notable? >> So far we are working on our core code, and when we are done with that, we are looking into partnerships and expanding our ecosystem with different projects. One of them is currently is Persona, which is a personal identity on the blockchain >> Lars, how did you get into all this? I mean, did you just fall out of a boat one day and fall in the water and say, hey blockchain? Was there a project, was it open source? Did you come in for a certain... Did you have an itch you were scratching? How did you guys get into this? >> I got into this because I have always had, my background is in construction, but I always had a passion for IT, and the new developments in that. So I started reading more about blockchain, and how it works and how it can change the world. So I said, okay, this vision is so great, I want to do something with it, and work more on this than my real job, and at the time I was not really practical to do both anymore, so I said okay, I'm going to full-time with this because I love this. >> When did Arcs all come together? What year, when did it all kind of come together? >> August or September 2016 we started. >> So you guys a couple of years ago, good. So it's a couple of years under the belt. So I got to ask you the question that comes up a lot here on theCUBE in my Cube conversations is, you have people looking at the new wave. >> Yeah. >> The infrastructure's changing completely over from old e-commerce web stack to a whole new network effect, decentralized and distributed, distributed computing's still very relevant, cloud computing of the source, now you've got decentralized. People are asking themselves, is a blockchain and decentralized apps a fit for me? So the question to you is, how do you answer that question? When someone says, "Why blockchain?" what's the answer? >> Depends, because you know always, blockchain is not always the answer. I think some people are putting too much blockchain on projects were are not really needing blockchain. And so I think it really depends on the use case or if it's needed. It's a solution to a problem. It's not always the... Not always needed, in that sense. >> John: Well, it's got to be a good fit. >> Exactly. >> You can't just say I'm doing blockchain and just throw it on top of it. >> No. >> It's got to be decentralized, it's got to be some... Well it kind of depends on the token too. Can you explain the token strategy? So let's just say, okay, I have a decentralized vision, architecture, but now I have to make my economic model match my token model. So there's certain coins, you have work coins for utility, you have you know Burn-and-Mint Equilibrium. So there's different approaches. What's your vision on how that's going to play out? Will it sort itself out? Is there a certain swim lane or a certain token model that fits a certain use case? Is there any patterns emerging? >> I think it really depends on what is needed, where are you looking at, where it's used for, is it just for utility, is it for security, it's really different but... So we said like, every use case would have their own blockchain, but because if you want to do something specific for your token, you can adapt to it, and not be stuck with the project you're working with. >> So you got to think it through. >> Yeah. >> Really do some deep thinking. >> Yeah. >> It's almost like designing an architecture for an OS. I mean it's really an operating system kind of decision to the business logic. Okay, so back to the event, you're a big sponsor. What's going on here for you? Obviously you've got great visibility. You guys doing any activities, are you showing anything, what's the big focus for the show for Arc? >> Just more, being out more to the world, bring everyone more, seeing what we are building and showing us like, and educating everyone what you are building and what you are doing and that we are actively working even with the French government about Arc. >> Why is Arc exciting for your contributors? What are they saying about you? What are some of the community mem... What's the feedback? >> That we are really engaged with the community, and that the community's even here, and we are actively talking with each other and even discussing the development with them, and even brainstorming with them. So we are really engaged with the community. >> Is there a differentiator that you have on your blockchain, is it faster, is it better, is it, what's the... What's the core thing that you tell people on why they should work with you? >> We are dedicated proof of stake, but in the vision that we are not vote multiple times, which your stake, you can only vote one time, and maybe that 80% of the coins in circulation are used for voting. So, and 51% to take is almost impossible, and there's lots of decentralization that delegates even. >> What does that mean for them? What's the impact to your partners and customers and users? >> The delegates are really helping because of their... Not only they provide a service to securing the network, they're also actively promoting our... Doing meetups, just everything, it's creating a great community. >> So it's growing? >> Yeah. >> Lars, thanks for coming on. Congratulations, you're a true entrepreneur. Love the hustle, love the fact you took a bold move in the big sponsorship. That was a tough decision, no, probably easy decision? >> No, it's a tough one. >> Big money. Good luck, Lars, with Arc.io, great project, got a good success, very community focused. Check 'em out online at Arc.io. I'm John Furrier with theCUBE. theCUBE.net is our URL, we're out in the open, we're in the open here on the floor at Consensus 2018, part of Blockchain Week New York. Thanks for watching, more live coverage after this short break.

>> From theCUBE Studios in Palo Alto in Boston, bringing you data driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante. >> New data from ETR's soon to be released April survey, shows a clear deceleration in spending and a more cautious posture from technology buyers. Just this week, we saw sell side downgrades in hardware companies like Dell and HP and revised guidance from high flyer UiPath, citing exposures to Russia, Europe and certain sales execution challenges, but these headlines, we think are a canary in the coal mine. According to ETR analysis and channel checks in theCUBE, the real story is these issues are not isolated. Rather we're seeing signs of caution from buyers across the board in enterprise tech. Hello and welcome to this week's Wikibon CUBE insights powered by ETR. In this Breaking Analysis, we are the bearers of bad news. Don't shoot the messenger. We'll share a first look at fresh data that suggests a tightening in tech spending calling for 6% growth this year which is below our January prediction of 8% for 2022. Now, unfortunately the party may be coming to an end at least for a while. You know, it's really not surprising, right? We've had a two year record run in tech spending and meteoric rises in high flying technology stocks. Hybrid work, equipping and securing remote workers. The forced march to digital that we talk about sometimes. These were all significant tailwinds for tech companies. The NASDAQ peaked late last year and then as you can see in this chart, bottomed in mid-March of 2022, and it made a nice run up through the 29th of last month, but the mini rally appears to be in jeopardy with FED rate hikes, Russia, supply chain challenges. There's a lot of uncertainty so we should expect the C-suite to be saying, hey, wait slow down. Now we don't think the concerns are confined to companies with exposure to Russia and Europe. We think it's more broad based than that and we're seeing caution from technology companies and tech buyers that we think is prudent, given the conditions. You know, looks like the two year party has ended and as my ETR colleague Erik Bradley said, a little hangover shouldn't be a surprise to anybody. So let's get right to the new spending data. I'm limited to what I can share with you today because ETR is in its quiet period and hasn't released full results yet outside of its client base. But, they did put out an alert today and I can share this slide. It shows the expectation on spending growth from more than a thousand CIOs and IT buyers who responded in the most recent survey. It measures their expectations for spending. The key focus areas that I want you to pay attention to in this data are the yellow bars. The most recent survey is the yellow compared to the blue and the gray bars, which are the December and September '21 surveys respectively. And you can see a steep drop from last year in Q1, lowered expectations for Q2 in the far right, a drop from nearly 9% last September to around 6% today. Now you may think a 200 basis point downgrade from our prediction in January of 8% seems somewhat benign, but in a $4 trillion IT market, that's 80 billion coming off the income statements of some tech companies. Now the good news is that 6% growth is still very healthy and higher than pre pandemic spending levels. And the buyers we've talked to this week are saying, look, we're still spending money. We just have to be more circumspect about where and how fast. Now, there were a few other callouts in the ETR data and in my discussions today with Erik Bradley on this. First, it looks like in response to expected supply chain constraints that buyers pulled forward their orders late last year and earlier this year. You remember when we couldn't buy toilet paper, people started the stockpile and it created this rubber banding effect. So we see clear signs of receding momentum in the PC and laptop market. But as we said, this is not isolated to PCs, UiPath's earning guidance confirm this but the story doesn't end there. This isn't isolated to UiPath in our view, rather it's a more based slowdown. The other big sign is spending in outsourced IT which is showing a meaningful deceleration in the last survey, showing a net score drop from 13% in January to 6% today. Net score remember is a measure of the net percentage of customers in the survey that on balance are spending more than last survey. It's derived by subtracting the percent of customers spending less from those spending more. And there's a, that's a 700 basis point drop in three months. This isn't a market where you can't hire enough people. The percent of companies hiring has gone from 10% during the pandemic to 50% today according to recent data from ETR. And we know there's still an acute skills shortage. So you would expect more IT outsourcing, but you don't see that in the data, it's down. And as this quote from Erik Bradley explains, historically, when outsourced IT drops like this, especially in a tight labor market, it's not good news for IT spending. All right, now, the other interesting callout from ETR were some specific company names that appear to be seeing the biggest change in spending momentum. Here's the list of those companies that all have meaningful exposure to Europe. That's really where the focus was. SAP has big exposure to on-premises installations and of course, Europe as well. ServiceNow has European exposure and also broad based exposure in IT in across the globe, especially in the US. Zoom didn't go to the moon, no surprise there given the quasi return to work and Zoom fatigue. McAfee is a bit of a concern because security seemed to be one of those areas, when you look at some of the other data, that is per actually insulated from all the spending caution. Of course we saw the Okta hack and we're going to cover that next week with hopefully some new data from ETR, but generally security's been holding up pretty well. You look at CrowdStrike, you look at Zscaler in particular. Adobe's another company that's had a nice bounce in the last couple of weeks. Accenture, again, speaks to that outsourcing headwinds that we mentioned earlier. And now the Google Cloud platform is a bit of a concern. It's still elevated overall, you know but down and well down in Europe. Under that magic, you know we often show that magic 40% dotted line, that red dotted line of net score anything above that we cite as elevated. Well, some important callouts to hear that you see companies that have Euro exposure. And again, we see this as just not confined to Europe and this is something we're going to pay close attention to and continue to report on in the next several weeks and months. All right, so what should we expect from here? The Ark investment stocks of Cathie Wood fame have been tracking in a downward trend since last November, meaning, you know, these high PE stocks are making lower lows and higher, sorry, lower highs and lower lows since then, right? The trend is not their friend. Investors I talk to are being much more cautious about buying the dip. They're raising cash and being a little bit more patient. You know, traders can trade in this environment but unless you can pay attention to in a minute by minute you're going to get whipsawed. Investors tell me that they're still eyeing big tech even though Apple has been on a recent tear and has some exposure with supply change challenges, they're looking for maybe entry points in, within that chop for Apple, Amazon, Microsoft, and Alphabet. And look, as I've been stressing, 6% spending growth is still very solid. It's a case of resetting the outlook relative to previous expectations. So when you zoom out and look at the growth in data, getting digital right, security investments, automation, cloud, AI containers, all the fundamentals are really strong and they have not changed. They're all powering this new digital economy and we believe it's just prudence versus a shift in the importance of IT. Now, one point of caution is there's a lot of discussion around a shift in global economies. Supply chain uncertainty, persistent semiconductor shortages especially in areas like, you know driver ICs and boring things like parts for displays and analog and micro controllers and power regulators. Stuff that's, you know, just not playing nice these days and wreaking havoc. And this creates uncertainty, which sometimes can pick up momentum in a snowballing effect. And that's something that we're watching closely and we're going to be vigilant reporting to you when we see changes in the data and in our forecast even when we think our forecast are wrong. Okay, that's it for today. Thanks to Alex Merson who does the production and podcasts for Breaking Analysis and Stephanie Chan who provides background research. Kristen Martin and Cheryl Knight, and all theCUBE writers they help get the word out, and thanks to Rob Hof, our EIC over at SiliconANGLE. Remember I publish weekly on wikibon.com and siliconangle.com. These episodes are all available as podcasts wherever you listen. All you got to do is search Breaking Analysis podcasts. etr.ai that's where you can get access to all this survey data and make your own cuts. It's awesome, check that out. Keep in touch with me. You can email me at dave.vellante@siliconangle.com. You can hit me up on LinkedIn. This is Dave Vellante for theCUBE insights powered by ETR. Be safe, stay well, and we'll see you next time. (gentle music)

(upbeat music) >> In 2009, Cisco made a major announcement in the form of UCS. It was designed to attack the IT labor problem. Cisco recognized that, data center professionals were struggling to be agile and provide the types of infrastructure services that lines of business were demanding for the modern applications of that day. The value proposition was all about, simplifying infrastructure deployment and management and by combining networking compute and storage with virtualization and a management layer, Cisco changed the game for running applications on premises and the era of converged infrastructure was born. Now fast forward a dozen years, and a lot has changed. The cloud has gone mainstream, forcing new requirements on organizations to bridge their on-prem environments to public clouds and manage workloads across clouds. Now to address this challenge, Cisco earlier this month, announced a series of offerings, that meaningfully expands its original vision, to support the more demanding requirements of today's dev sec ops teams. In particular Cisco, with this announcement is enabling customers to deploy a full stack cloud-like operating model that leverages modern platforms such as Kubernetes, new integrations and advanced tooling to bring automation, visibility and better security for both hybrid and multi-cloud environments. Now the underpinning of this solution, is a new UCS architecture called the X series. Cisco claims this new system gives customers a trusted platform for the next decade to support their hybrid and multi-cloud workloads. Gents, great to see you, welcome. >> Hey, thank you. Good to be here. >> Thanks for having a us Dave. I appreciate. >> My pleasure. Looking forward to this. So look, we've seen the X series announcement and it looks to be quite a new approach. What are the critical aspects of the X series that you want people to understand? Maybe James, and you can take that. >> Sure I think that, you know, overall, there is a lot of change coming in the marketplace, right? We're seeing we're looking at and we're seeing from a technology standpoint, a significant amount of change. Look at CPU's and GPU's, the power draw alone is becoming, you know, it basically at the trajectory, it is, it may be untenable for some, you know, of the current configurations that people are consuming, right? So some of these current architectures just can't deal with that, right? Or at least they can't deal with what's coming in the future. We're also seeing the relevance of other types of architectures like maybe arm to start to become something that our customers want to take advantage of, right? Or maybe want to see how that scale fits into their environment on a totally different level. At the same time, the fabrics are really evolving at lightning speed here, right? So we're seeing PCI express, we've gone from gen three to gen four, gen five is coming in the very near future. We're layering on top of that, things like CXL to take that, that fabric to the next level for capabilities and be able to do things that we couldn't do before. To connect things together, we couldn't do before. Beyond that, we probably are just a few years away from even more exciting developments in the fabric space around some of the high performance low latency fabrics that are that are again on the drawing board today just around the corner. Take that and you, you look at the kind of the evolution of the the admin, right? So we're seeing the admin developer emerge. No longer is this just a guy who's sitting in front of a dashboard and managing systems, keeping them up and down, we're now seeing a whole class of developers that are also administrators, right? So all of this together is starting to push us well beyond what human scale really can manage, what human scale can consume. So, there's a lot of change coming and I think that we're taking a look at that and realizing that something like X series has to be able to deal with that change and the challenges that it brings, but also and do so in a simple manner that we can allow automation orchestration and some of these new capabilities to enhance what our customers can do, not to drown them in technology. >> You know, that taught, that's kind of interesting what James was saying about beyond human scale. I mean, I think my little narrative upfront, it was sort of, hey, we recognize as an IT labor problem. We're going to address that. And it really wasn't about massive scale back then, it is now. We really what we've learned from the cloud guys, right? >> Definitely. I mean, people are moving from pets to cattle to now with containers, they're saying that it's mosquitoes, right? Cause they're so ephemeral, they come and go and on a single host, you could have, you know, hundreds if not thousands of containers. And so the application environment has influenced the infrastructure design and really changed the role of the infrastructure operator to one that necessitates automation, necessitates operations at scale, even on prem everyone's trying to operate in that cloud like model and they're trying to bridge, the big challenge I see is, they're trying to bridge their existing environment big monolithic applications they've got on-prem with those data lakes that they built around them over the past decade, but they're also trying to follow their developers as they go out into the public cloud and innovate there. That's really where the nexus of all the application innovation is. So the IT teams who are already strapped for resources it's not like their budgets are going up every year, are now taking on a new front out in the cloud while they're still trying to maintain the systems that they've built with on-prem. That's the challenge. >> Yeah that's really the hard part and where some of the innovation here is, is anybody that lives in an old house knows that connecting old to new is very challenging much more challenging than building from scratch. But James I wonder if we'd come back to the to the architecture of the X series and what's really unique about it and what's in it for your customers? >> Yes, absolutely. So we're, when were looking at at kind of redesigning this thing from the ground up, we recognized that, you know from a timing standpoint, we're sitting at a place with the development of future fabrics and some of these other technologies that we finally have the opportunity to hit the timing perfectly to start to do composability right. So we've heard a lot of noise, you know in the market for the last several years about composability and how that's going to be the salvation or change the game here. But at the end of the day, the technology hasn't been there in those offerings, right? So we're sitting at the edge of some of the development of those technologies that are going to allow us to do that. And what we've done with X series, is we've taken a construct that we call the UCS X fabric, which is the ability to consume these technologies today as like a effectively a chassis fabric that can allow us to connect resources together within the chassis and future external to the chassis. But it also allows us to take advantage of the change in fabric that's coming. So as fabrics evolve, as we see new technologies like CXL and the PCI express gen five and beyond, come into play here and eventually physical technologies like Silicon Photonix, those are constructs that are going to allow our customers to do some amazing things and we have the construct to be able to consume those. Our goal here is like, to effectively look out at these disruptive technologies on the horizon and make sure that they're not disrupting our customers that we give our customers the ability to disrupt their competitors and to disrupt their markets, but by consuming those technologies in an easy way. >> You know, you didn't use the term future-proof. And I usually don't like that phrase because a lot of times people go that's future-proof and I'm like, well, what's future proof? Well, it's really fast. Well, okay. And in two years, it's going to be, you know really slow compared to everything else. But what you, what you just laid out is an architecture that's really taking advantage of some of these new capabilities that are driving latency down. So that's so, thank you for that. Now, Todd I get how the X series is going to enable customers you know, today I just mentioned the future but how does it play into Cisco's hybrid cloud vision? >> Well I mean, our customers aren't looking for, you know, point solutions or bolt on layers of software to manage across the hybrid cloud landscape. That's the fundamental challenge and so what we're doing with intersite, if you really think about all the systems that we have in our portfolio, like X series, really it's just extensions of our inner site platform. And there we're bridging the gaps between fundamental infrastructure prem, with all of those services that you need to optimize workloads and infrastructure, both in that on-prem environment but also out in the public cloud and even moving up the stack now into serverless. So we know that customers again are trying to bolt together a cohesive environment that allows them to manage those existing workloads on prem but also support the innovation going on out in the cloud and to do that, you have to have services to manage Kubernetes. You need hooks into modern tool chains like a Hashi corks Terraform, we did that a few months back and we recently brought in something we call our service mesh manager that came out of an acquisition of a Bonzai cloud. So what we're doing is, we're kind of spanning that entire spectrum from physical infrastructure, to the workload and that could be extracted in any number of ways either in containers or containers around VMs or bare metal running applications run on bare metal or just virtual machine applications encapsulation. So, you got all these different modalities that customers are going to run applications in and it's our intent to create a platform here that supports all of them, both on their on-prem environment and also all the resources they're managing out in the cloud. So that's a big deal for us. You know, one thing I want to go back to the X series for a second, something James mentioned, right? Is you know as we see subsystems in computing, start to decompose and break apart, you know, we have intersite as the mechanism to put Humpty Dumpty back together again and that's really, I think composability and district's options bar, but that's okay. But so I'll read it together. And like James said, you know be able to take on whatever fabrics, low latency fabrics, ultra low latency fabrics we need in coming years to sew these systems together, we're kind of breaking a barrier that didn't, that wasn't, you know people have trouble breaking through in the past, right? And that's this idea of true infrastructure as code or true software defined infrastructure. Cause now we're talking about being able to apply policy and automation, to the actual construct of a server. How do you build that thing to the needs of the workload? And so if you talk to an SRE or a developer today and you say infrastructure, they're thinking of Kubernetes cluster, but ultimately we want to push that boundary or that frontier between the world software to find it abstracted as far down in the infrastructure, as we can. And with intersite and X fabric and X series, we're taking it all the way down to the individual drive or CPU or ultimately breaking memory apart and sewing that back together. So it's kind of exciting time for us, cause really, pushing that frontier of what is software defined further and further down into the infrastructure and that just gives people a lot more flexibility in what they build. >> So I want to play something back to you and see if it resonates. Essentially, I look at what you just said is you're building a layer across my on-prem, whatever public cloud across clouds at the conventionally, you know, get to the edge, but let's hold off on that, let's park that for now. But that layer obstructs the underlying technical complexity and allows that infrastructure to be, you said programmable, infrastructure is code essentially. So that's one of my other questions, it's like, how programmable is this infrastructure, you know, today and in the future? But is that idea of an abstraction layer kind of how you're thinking about hybrid and multi-cloud? >> It is in terms of the infrastructure that customers are going to run on prem right in the public cloud the cloud providers are already abstracting that for them. And so what we want to do is bring that same type of public cloud experience to managing infrastructure on prem. So being able to have pools of resources that you allocate out to workloads, shifted as things change. So it's absolutely a cloud-like approach to on-prem infrastructure and you know, one of the things I like to say is, you know, friends don't let friends, build their own private cloud platforms from scratch, right? We're productizing this, we're bringing it as a cohesive system that customers don't need to engineer on their own. They can focus on their operations and James actually, he's a pilot, and one of the things he observed about Intersight a couple of years ago was, this idea of Intersight as a co-pilot and kind of, you know, adding a person to your team almost when you have intersite in your data center, because some very, what feels like rudimentary things are incredibly impactful day-to-day for our customers. So we have recommendation engines. If it, if like, you know, maybe it says some interplay between bios and firmware and operating system and we know that there's an issue there rather than letting customers stumble upon that on their own we're going to flag it, show them the correction, go implement it for them. So that it starts to feel a lot more like what they're accustomed to in a public cloud setting where the system has some intelligence baked in, the system is kind of covering them and watching their back and acting like a co-pilot day-to-day operations. >> Okay, so I get that, you know, the cloud guys will abstract the complexity you guys are focused on prem, but is it, so my question then is multi-cloud across clouds because we have some cloud providers, you know you're partners with Google they do some things with Antho, so I know Microsoft with Ark, but even near-term. Should we think about Cisco as playing that role of my, across cloud, you know, partner if you will? >> Absolutely. You know, cloud agnosticism is core to our approach because we know that, you know if you dial the clock way back to the early odds, right? When cloud first started emerging it was kind of an efficiency play. And you had folks like Nicholas Carr, right? The author that they put out the big switch, kind of envisioning a world where there'd be this ultimate consolidation to maybe one or two or three cloud platforms worldwide. But what we're seeing, you know we had data sovereignty kind of emerge over the past decade but even the past year or two, it's now becoming issues of actual cloud sovereignty. So you have governments in Australia and in India and in Europe actually asserting control over the cloud providers and services that can be used by their public sector organizations and so that's just leading to actually cloud fragmentation. It's not nearly as monolithic of future as we thought it would be. It's a lot of clouds and so as customers want to move around geographically or if they want to go harvest innovation that maybe Google is really good at something like machine vision, or they want to use AWS or Azure for different applications that they're going to go build. We're seeing customers really being put in a place where they're going to deal with multiple cloud providers and the data supports that. So it's definitely our approach especially on the networking technology side to make it very easy for our customers to go out and connect these different clouds and not have to repeat the integration process every time they want to go, you know, start using another public cloud provider. So that's absolutely our strategies to be very agnostic and build everything in mind for customers they're going to be using in multiple providers. >> Thank you for that touch. So James, I want to come back and talk a little bit about sort of your competitive posture here. I mean, you guys, when you made the announcement, I inferred that you were feeling like you were in a pretty good position relative to the competition that you were putting forth, not just you know, core infrastructure in hardware and software but also all these other components around it that we talked about, observability extending out to the, you know, beyond the four walls of my data center, et cetera. But talk a little bit about why you think this gives you such competitive advantage in the marketplace. >> Well I mean, I think first of all, back to where Todd was going as well, is that, you know if you think about trying to be, to work in this hybrid cloud world, that we're clearly living in, the idea of burrowing features and functions as far down the stack as possible, doesn't make a lot of sense, right? So intersite is a great example. We want to manage and we want to orchestrate across clouds, right? So how are we going to have our management and infrastructure services buried into the chassis, down at the very lowest level, that doesn't make sense. So we elevated our, you know, our operating model to the cloud, right? And that's how we manage across clouds from the cloud. So, building a system and really we've done this from the ground up with X series, building a system that is able to take advantage of all these two technologies. And you mentioned, you know, how being future proof was probably you know, a derogatory term almost and I agree with you completely. I think we're future ready. Like, we're ready to embrace it because we're not trying to say that nothing is going to change beyond what we've already thought of, we're saying, bring it on. We're saying, bring on that change because we're ready for it. We've we can accommodate change. We, we're not saying that the technology we have today is to going to ride us for 10 years, we're saying,, we're ready for the next 10 years of change. Bring it. We can do that in a simple way. That is, you know, I think, you know going to give us the versatility and the simplicity to allow the technology to go beyond human scale without having to you know drown our customers in administrative duties, right? So that co-pilot that Todd mentioned is going to be able to take on a lot more of the work, just like an airplane where you know, the pilot has functionality that he has to absolutely be part of and those are the our developers, right? We want those admin developers to develop, to build things and to do things and not get bogged down in the minutiae that exists. So I think competitively, you know, our architecture top to bottom, you know, all the way up the stack, all the way to the bottom is unique and it is focused on not just the rear view mirror but what's coming in the future. >> So my takeaway there is that, okay, I get it. The new technologies will come along but this architecture is the architecture for the decade. You're not going to have to redo the architecture in a few years. That's really the key point here. Todd, I'll give you last word might just taking some notes here and takeaways that I heard, I heard upfront. Chip diversity really take advantage of all the innovations that are coming out. You're ready for that. You're kind of blurring the lines between blade and rack, giving some optionality there. Scale is a big theme. I mean, the cloud has brought that in and, you know people want to scale, they don't want to be, you know provisioning lawns all day and they won't be able to scale if that's what their job is. Developer friendly, particularly as it relates to infrastructure as code. And you've got a roadmap. So Todd, that's my summary. I'll give you the last word. >> No, it's really good. I mean, you hit it, right. We're thinking about this holistic operating environment that our customers are building for hybrid cloud and we're pre-engineering that environment for them. So our Intersight platform, all of our systems that connect to that, are really built to tackle that hybrid environment from end to end, and with systems like X series, we're giving them a more simple, efficient landing spot for their workloads on prem but crucially it's fully integrated with this hybrid cloud platform so as they have workloads on prem and workloads in the cloud, it's kind of a transparent environment between those two, between those two, two worlds there. So bringing it together so that our customers don't have to build it themselves. >> Excellent. Well, gents thanks so much for coming on theCUBE and sharing the details of this announcement. Congratulations, I know how much work and thought goes into these things, really looking forward to its progress and adoption in the marketplace. Appreciate your time. >> Thank you. >> Thanks for time. >> And thank you for watching this cube conversation. This is Dave Vellante. We'll see you next time. (upbeat music)

>> From the SiliconANGLE Media office in Boston, Massachusetts, it's the cube. Now, here's your host, Dave Vellante. >> Hello everyone and welcome to this week's Wikibon cube insights powered by ETR. In this breaking analysis ahead of the RSA conference, we want to update you on the cyber security sector. This year's event is underlined by coronavirus fears, IBM has pulled out of the event and cited the epidemic as the reason and it's also brings to the front the sale of RSA by Dell to STG partners and private equity firm. Now in our last security drill down, we cited several mega trends in the security sector. These included the ever escalating sophistication of the attacker, the increased risk from the data economy, the expanded attack surface with the huge number of IP addresses that are that are exploding out there, and the lack of skills and the number of cyber tools that are coming to the market. Now, as you know, in these segments, we'd like to share insights from the cube. And I want you to listen to two American statesman and what they said, on The Cube. Here's general Keith Alexander, who's the former director of the NSA, along with Dr. Robert Gates, who's the former director of the CIA and former Secretary of Defense, play the clip. >> When you think about threats, you think about nation states, so you can go to Iran, Russia, China, North Korea, and then you think about criminal threats, and all the things like ransomware. Some of the nation state actors are also criminals at night, so they can use nation state tools and my concern about all the evolution of cyber threats is that the attacks are getting more destructive. >> I think cyber and the risks associated with cyber, and IT need to be a regular part of every board's agenda. >> So you hear General Alexander really underscore the danger, as well, Dr. Gates is articulating what we've said many times on the cube that cyber security is a board level agenda item. Now, the comments from both of these individuals represent what I would consider tailwinds for cyber technology companies. Now we're going to drill into some of those today. But it's not all frictionless. There are headwinds to in this market space, cloud migration, the shift from north south south to East West network traffic, its pressure traditional appliance based perimeter security solutions, increase complexity and lack of skills and other macro factors, including questions on ROI. CFO saying, hey, we spend all this cash, why aren't we more secure? Now, I want you to hear from two chief information security officers officers on both the challenges that they face and how they're dealing with them. Roll the clip. >> Lack of talent, I mean, we're starving for talent. Cybersecurity is the only field in the world with negative unemployment. We just don't have the actual bodies to actually fill the gaps that we have and in that lack of talent Cecil's are starving. >> I think that the public cloud offers us a really interesting opportunity to reinvent security right. So if you think about all of the technologies and processes and many of which are manual over the years, I think we have an opportunity to leverage automation to make our work easier in some ways. >> Now I featured Brian Lozada and Katie Jenkins before and breaking analysis segments, and you can hear it from the cyber leaders, we lack the talent, and cloud computing and automation are areas we're pursuing. So this challenges security companies to respond. But at the end of the day, companies have no no choice. In other words, organizations buying security solutions, the sophistication of the attacker is very high and the answer to my CFO and ROI is fear based. If you don't do this, you might lose billions in market cap. Now, I want you to take a listen to these cubilam talking about the attacker of sophistication and the importance of communication skills in order to fund cyber initiatives, really to keep up with the bad guys, please play the clip. >> The adversary is talented and they're patient, they're well funded okay, that's that's where it starts. And so, you know why why bring an interpreter to a host when there's already one there right? Why write all this complicated software distribution when I can just use yours. And so that's that's where the play the game starts. And and the most advanced threats aren't leaving footprints because the footprints already there, you know, they'll get on a machine and behaviorally they'll check the cash to see what's hot. And what's hot in the cash means that behaviorally, it's a fast they can go they're not cutting a new trail most of the time, right? So living off the land is not only the tools that they're using the automation, your automation they're using against you, but it's also behavioral. >> That's why the most the most important talent or skill that a security professional needs is communication skills. If you can't articulate technical risk into a business risk to fund your program, it's, you know, it's very hard for you to actually be successful in security. >> Now, the really insidious thing about what TK Keanini just said is the attackers are living off the land, meaning they're using your tools and your behaviors to sneak around your data unnoticed. And so as Brian Lozada said, as a security Pro, you need to be a great communicator in order to get the funding that you need to compete with the bad guys. Which brings me to the RSA conference. This is why you as a security practitioner attend, you want to learn more, you want to obtain new skills, you want to bring back ideas to the organization. Now one of the things I did to prepare for this segment is to read the RSA conference content agenda, which was co authored by Britta Glade and I read numerous blogs and articles about what to expect at the event and from all that I put together this word cloud, which conveys some of the key themes that I would expect you're going to hear at the shows. Look at skills jump right out, just like Brian was saying, the human element is going to be a big deal this year. IoT and the IT OT schism, everyone's talking about the Olympics, and seeing that as a watershed event for cyber, how to apply machine learning and AI is a big theme, as is cloud with containers and server less. phishing, zero trust and frameworks, framework for privacy, frameworks for governance and compliance, the 2020 election and weaponizing social media with deep fakes, and expect to hear a lot about the challenges of securing 5G networks, open source risks, supply chain risks, and of course, the need for automation. And it's no surprise there's going to be a lot of talk about cyber technology, the products and of course, the companies that sell them. So let's get into the market and unpack some of the ETR spending data and drill into some of these companies. The first chart I want to show you is spending on cyber relative to other initiatives. What this chart shows is the spending on cyber security highlighted in the green in relation to other sectors in the ETR taxonomy. Notice the blue dot. It shows the change in spending expected in 2020 versus 2019. Now, two points here. First, is that despite the top of my narrative that we always hear, the reality is that other initiatives compete for budget and you just can't keep throwing cash at the security problem. As I've said before, we spend like .014% percent of our global GDP on cyber, so we barely scratched the surface. The second point is there's there's there's a solid year on year growth quite high at 12% for a sector that's estimated at 100 to 150 billion dollars worldwide, according to many sources. Now let's take a look at some of the players in this space, who are going to be presenting at the RSA conference. You might remember to my 2020 predictions in that breaking analysis I focused on two ETR metrics, Net Score, which is a measure of spending velocity and Market Share, which measures pervasiveness in the data set. And I anointed nine security players as four star players. These were Microsoft, Cisco, Palo Alto Networks, Splunk, Proofpoint, Fortinet, Oka, Cyber Ark and CrowdStrike. What we're showing here is an update of that data with the January survey data. My four star companies were defined as those in the cyber security sector that demonstrate in both net scores or spending momentum, that's the left hand chart and market share or pervasiveness on the right hand chart. Within the top 22 companies, why did I pick 22? Well, seemed like a solid number and it fit nicely in the screen and allowed more folks. So a few takeaways here. One is that there are a lot of cyber security companies in the green from the standpoint of net score. Number two is that Fortinet and Cisco fell off the four star list because of their net scores. While still holding reasonably well, they dropped somewhat. Also, some other companies like Verona's and Vera code and Carbon Black jumped up on the net score rankings, but Cisco and Fortinet are still showing some strength in the market overall, I'ma talk about that. Cisco security businesses up 9% in the quarter, and Fortinet is breaking away from Palo Alto Networks from a valuation perspective, which I'm going to drill into a bit. So we're going to give Cisco and Fortinet two stars this survey period. But look at Zscaler. They made the cut this time their net score or spending momentum jumped from 38% last quarter to nearly 45% in the January survey, with a sizable shared in at 123. So we've added Zscaler to the four star list, they have momentum, and we're going to continue to watch that quarterly horse race. Now, I'd be remiss if I didn't point out that Microsoft continues to get stronger and stronger in many sectors including cyber. So that's something to really pay attention to. Okay, I want to talk about the valuations a bit. Valuations of cyber security space are really interesting and for reasons we've discussed before the market's hot right now, some people think it's overvalued, but I think the space is going to continue to perform quite well, relative to other areas and tech. Why do I say that? Because cyber continues to be a big priority for organizations, the software and annual recurring revenue contribution ARR continues to grow, M&A is going to continue to be robust in my view, which is going to fuel valuations. So Let's look at some of the public companies within cyber. What I've compiled in this chart is eight public companies that were cited as four star or two star firms, as I defined earlier, now ranked this by market value. In the columns, we show the market cap and trailing 12 month revenue in billions, the revenue multiple and the annual revenue growth. And I've highlighted Palo Alto Networks and Fortinet because I want to drill into those two firms, as there's a valuation divergence going on between those two names, and I'll come back to that in just a minute. But first, I want to make a few points about this data. Number one is there's definitely a proportional relationship between the growth rate and the revenue multiple or premium being paid for these companies. Generally growth ranges between one and a half to three times the revenue multiple being paid. CrowdStrike for example has a 39 x revenue multiple and is growing at 110%, so they're at the high end of that range with a growth at 2.8 times their revenue multiple today. Second, and related, as you can see a wide range of revenue multiples based on these growth rates with CrowdStrike, Okta and now Zscaler as the standouts in this regard. And I have to call at Splunk as well. They're both large, and they have high growth, although they are moving beyond, you know, security, they're going into adjacencies and big data analytics, but you you have to love the performance of Splunk. The third point is this is a lucrative market. You have several companies with valuations in the double digit billions, and many with multi billion dollar market values. Cyber chaos means cash for many of these companies, and, of course for their investors. Now, Palo Alto throw some of these ratios out of whack, ie, why the lower revenue multiple with that type of growth, and it's because they've had some execution issues lately. And this annual growth rate is really not the best reflection of the stock price today. That's really being driven by quarterly growth rates and less robust management guidance. So why don't we look into that a bit. What this chart shows is the one year relative stock prices of Palo Alto Networks in the blue and compared to Fortinet in the red. Look at the divergence in the two stocks, look at they traded in a range and then you saw the split when Palo Alto missed its quarter last year. So let me share what I think is happening. First, Palo Alto has been a very solid performance since an IPO in 2012. It's delivered more than four Rex returns to shareholders over that period. Now, what they're trying to do is cloud proof their business. They're trying to transition more to an AR model, and rely less on appliance centric firewalls, and firewalls are core part of the business and that has underperformed expectations lately. And you just take Legacy Tech and Cloud Wash and Cloud native competitors like Zscaler are taking advantage of this and setting the narrative there. Now Palo Alto Network has also had some very tough compares in 2019 relative to 2018, that should somewhat abate this year. Also, Palo Alto has said some execution issues during this transition, especially related to sales and sales incentives and aligning that with this new world of cloud. And finally, Palo Alto was in the process of digesting some acquisitions like Twistlock, PureSec and some others over the past year, and that could be a distraction. Fortinet on the other hand, is benefiting from a large portfolio refresh is capitalizing on the momentum that that's bringing, in fact, all the companies I listed you know, they may be undervalued despite, of all the company sorry that I listed Fortinet may be undervalued despite the drop off from the four star list that I mentioned earlier. Fortinet is one of those companies with a large solution set that can cover a lot of market space. And where Fortinet faces similar headwinds as Palo Alto, it seems to be executing better on the cloud transition. Now the last thing I want to share on this topic is some data from the ETR regression testing. What ETR does is their data scientists run regression models and fit a linear equation to determine whether Wall Street earnings consensus estimates are consistent with the ETR spending data, they started trying to line those up and see what the divergence is. What this chart shows is the results of that regression analysis for both Fortinet and Palo Alto. And you can see the ETR spending data suggests that both companies could outperform somewhat expectations. Now, I wouldn't run and buy the stock based on this data as there's a lot more to the story, but let's watch the earnings and see how this plays out. All right, I want to make a few comments about the sale of the RSA asset. EMC bought RSA for around the same number, roughly $2 billion that SDG is paying Dell. So I'm obviously not impressed with the return that RSA has delivered since 2006. The interesting takeaway is that Dell is choosing liquidity over the RSA cyber security asset. So it says to me that their ability to pay down debt is much more important to Dell and their go forward plan. Remember, for every $5 billion that Dell pays down in gross debt, it dropped 25 cents to EPS. This is important for Dell to get back to investment grade debt, which will further lower its cost. It's a lever that Dell can turn. Now and also in thinking about this, it's interesting that VMware, which the member is acquiring security assets like crazy and most recently purchased carbon black, and they're building out a Security Division, they obviously didn't paw on the table fighting to roll RSA into that division. You know maybe they did in the financial value of the cash to Dell was greater than the value of the RSA customers, the RSA product portfolio and of course, the RSA conference. But my guess is Gelsinger and VMware didn't want the legacy tech. Gelsinger said many times that security is broken, it's his mission to fix it or die trying. So I would bet that he and VMware didn't see RSA as a path to fixing security, it's more likely that they saw it as a non strategic shrinking asset that they didn't want any part of. Now for the record, and I'm even won't bother showing you the the data but RSA and the ETR data set is an unimpressive player in cyber security, their market share or pervasiveness is middle of the pack, so it's okay but their net score spending velocities in the red, and it's in the bottom 20th percentile of the data set. But it is a known brand, certainly within cyber. It's got a great conference and it's been it's probably better that a PE company owns them than being a misfit toy inside of Dell. All right, it's time to summarize, as we've been stressing in our breaking analysis segments and on the cube, the adversaries are very capable. And we should expect continued escalation. Venture capital is going to keep pouring into startups and that's going to lead to more fragmentation. But the market is going to remain right for M&A With valuations on the rise. The battle continues for best of breed tools from upstarts like CrowdStrike and Okta and Zscaler versus sweets from big players like Cisco, Palo Alto Networks and Fortinet. Growth is going to continue to drive valuations. And so let's keep our eyes on the cloud, remains disruptive and for some provides momentum for others provides friction. Security practitioners will continue to be well paid because there's a skill shortage and that's not going away despite the push toward automation. Got in talk about machine intelligence but AI and ML those tools, there are two edged sword as bad actors are leveraging installed infrastructure, both tools and behaviors to so called live off the land, upping the stakes in the arms race. Okay, this is Dave Vellante for Wikibon's CUBE Insights powered by ETR. Thanks for watching this breaking analysis. Remember, these episodes are all available as podcasted Spotfire or wherever you listen. Connect with me at david.vellante at siliconangle.com, or comment on my LinkedIn. I'm @dvellante on Twitter. Thanks for watching everybody. We'll see you next time. (upbeat music).

>> From the silicon angle media office in Boston Massachusetts, it's the Cube. Now here's your host, Dave Vellante. >> Hello everyone and welcome to this week's episode of wiki buns cube insights, powered by ETR. In this breaking analysis, I plan to look deeper into the cloud market and specifically the business results and the momentum of the big three U.S cloud players. Now, Google last week opened up a bit and they not only broke out YouTube's revenues but also its cloud business. And quite a bit more detailed now like Microsoft the numbers are still somewhat opaque and hard to compare with AWS numbers which I find much cleaner. Nonetheless by squinting through the data, we're able to better understand the momentum that these three companies have in cloud and of course the ETR spending data, gives us an added data-driven dimension that is really insightful and helpful. Today we're focusing on, the big three in cloud. Amazon's AWS, Google's cloud platform GCP and Microsoft Azure. Now to meet the other U.S players are not hyper scalars and they're really not even in the discussion other than is an extension of their existing business. As an example, it would take IBM and Oracle between four and six years to spend as much on capex as Google spends, in four months. Now coming back to the big three. Each of these companies is coming at the opportunity with a different perspective. But Amazon and Microsoft, have been on a collision course for quite some time now. Google of course aspires to get into that conversation. Amazon in my opinion is the gold standard in cloud and I specifically refer to infrastructure as a service. They created the market and have earned the right to define the sector. Competitors like Microsoft are smart to differentiate and I'm going to discuss that. But first, let's take a listen as to how Amazon's CEO Andy Jassy Amazon web services CEO Andy Jassy, thinks about the goals of the AWS business. Roll the clip please. >> A high-level are top-down aggressive goals that we want every single customer who uses our platform to have an outstanding customer experience. And we want that outstanding customer experience in part is that their operational performance and their security are outstanding. But also that it allows them to build projects and initiatives that change their customer experience and allow them to be a sustainable successful business over a long period of time and then, we also really want to be the technology infrastructure platform under all the applications of people build. >> So, what's interesting to me here is how Jesse thinks about the AWS platform. It's a platform, to build applications. It's not a SaaS, it's not a platform which AWS can use to sell its software packages, it's a place to build apps. Any application, any workload, any place in the world. So when I say AWS has clean numbers, it's because they have a clean business. Infrastructure is what they do, period. That's what they report in their numbers and it's clean. Now compare that with Microsoft. Microsoft is doing incredibly well in the cloud and will come back to that, but Microsoft is taking a much different approach to the market. They report cloud revenue but it comprises public, private and hybrid. It includes SQL Server, Windows Server, Visual Studio, System Center, GateHub and Azure. And also support services and consulting. But the key here is they defined cloud to their advantage which is smart trying to differentiate with a multi cloud any cloud, any edge, story. Think Microsoft Azure stack slash Microsoft Ark etc. Now Google as we know is coming at this as a late comer. They admit they're a challenger. Their starting point is G suite. Their cloud focus is infrastructure and analytics. So, with that as some background let's take a look at the wiki bond estimates for I as revenue in 2019. What we have here is our estimates of AWS Azure and GCPs is IaaS and PaaS revenue, for 2018 and 2019. We've tried to strip out everything else so we can make an apples-to-apples comparison with Amazon. So let's start with Amazon. The street is concerned about the growth rate of AWS. It grew 35% last quarter, which admittedly is slowing down. But it did just under 10 billion. Think about that. AWS will probably hit a 50 billion dollar run rate this year 50 billion and it's growing in the double digits. AWS is going to be larger than Oracle this year and Cisco is next in its sights. it's like Drew Brees knocking down records in the NFL. Microsoft is very strong but remember, these are estimates. They report as your growth, but they don't really give us a dollar figure. We have to infer that from other data. So the narrative on Microsoft is they're catching up to AWS and in one-dimension that's true because they're growing faster than AWS. But AWS in 2019 grew by an amount almost equal to Asher's entire business in 2018. Now Google is hard to peg. The only thing we know is Google said it's cloud business was 9 billion in 2019, up from 5.8 billion in 18 and 4 billion in 17. So we're seeing an accelerating growth rate. That they said is largely attributable to GCP and they told us that GCP is growing significantly faster than their overall business. Which remember includes, G suite, cloud business that is. Okay. So that's the picture. Now, I want to take a minute to talk about the profitability of the cloud. On the Microsoft earnings call, Heather Bellini of Goldman Sachs, she was effusive she's an analyst exclaiming how impressed she was with the fact that Microsoft has been consistently increasing its cloud gross margins each quarter. I think was up five points in the last quarter. And on the Google call, Heather again was praising Google CEO Sundar Pichai on gross margin guidance for GCP. Which Sundar didn't answer. As well, Andy Jassy said in the Q blast reinvent that the cloud was higher margin than retail but it's scale, it's a relatively low margin business. As compared to software. I would like to comment on all this. First I think Jesse is sandbagging. AWS is a great margin business in my opinion. AWS has operating margins consistently in the mid 20s like 26% last quarter. Now, Bellini on the earnings call, was pressing on gross margins which in my opinion are even more impressive. Here's why. This is a chart I drew a long long time ago. It's a very basic view of the economics of the different sectors of the technology business. Namely hardware, software and services. Now, that each have a different margin profile as we're showing here. On the vertical axes, marginal cost that is the incremental cost of producing one additional unit of a product or service. On the horizontal axis, is volume. And we're showing the Pre-Cloud Era on the left and the Post-Cloud Era on the right-hand side of the chart. And you can see each segment has a different cost and hence different margin profile. In Hardware, you have economies at volume but you have to purchase and assemble components and so at some point your marginal cost hit a floor. Professional services have a diseconomies of scale. Meaning at higher volume, things get more complex and you have more overhead. Now that red line is software and everybody loves software because the marginal costs go to zero and your gross margin approaches the cost of distributing the software. Back in the old days, it really came down to the cost of a what our custom distributed a disk or a CD. So software gross margins are absolutely huge. Now let me call your attention to the green line that we've labeled outsourcing. In the pre-cloud era, outsourcing companies could get some economies but it really wasn't game changing. But in the post-cloud world the hyper scalars are driving automation. Now I'm exaggerating the margin impact because the cloud players still have to buy hardware and they have other costs. But the point is, gross margin and outsourcing IT to a cloud player is far more attractive to the vendor at scale. So Heather Bellini, was essentially asking Sachini Adela how is it that you can keep expanding your gross margins each quarter and she was trying to understand, if GCP gross margins were tracking similar to where AWS and Azure were back when they were smaller. And I think these curves at least give us some guidance. All right, so now let's pivot into the ETR data. This chart shows net score which remember, refers to spending velocity for each of the big three cloud players. Over the past nine surveys for cloud computing the cloud computing sector. Now three things stand out. First is that AWS remains very strong with net scores solidly in the 60% plus range. Second, is Azure has sustained a clear momentum lead over AWS, since the July 18 survey. And the third, is look at GCP's uptick. It's very notable and quite encouraging for Google. Now, let's take another cut on this data and drill into the larger companies, in the ETR data set. Look what happens when you isolate on Fortune 500. Two points here, AWS actually retakes the lead over azure, in net score or spending velocity even though Azure remains very strong. Amazon's showing in large accounts is very very impressive. Nearly back to early 2018 peak levels at 76%. So really strong net scores. The second point is GCPs uptrend holds firm and actually increases slightly, in these larger accounts. So it appears, that the big brands which perhaps used to shy away from cloud, are now increasingly adopting. Now, one of the things ETR does that I love is these drill downs, where they'll ask specific questions that are both timely and relevant. So we want to know, what every salesperson wants to know. Why do they buy? And that's what this chart shows. It shows data from the ETR drill downs and on the left hand in the green or the y the buys from Microsoft AWS and Google cloud. For Microsoft CIOs a compatibility with existing skills and the organization's IT footprint then its feature set etc. Look here's the deal, this is mr. softies huge advantage. It's just simpler to migrate work to Azure if you're already running Microsoft apps. And if Microsoft continues to deliver adequate features it's a no-brainer for many customers. For AWS, the pluses are ROI near-term and long-term and I've said many times, best cloud in terms of reliability, uptime, security AWS has the best cloud for infrastructure. And if you're not incurring huge migration cost or if you're not Walmart, why wouldn't you go, with the best cloud? Now GCP comes down to the tech. Google has good tech and IT guys. They're geeks. And geeks love Tech. And when it comes to analytics, Google is very very strong as well. Now the right-hand side of this chart shows why this is not in my opinion a winner-take-all game. The chart shows the percent of workloads in the cloud today in two years and three years across different survey dates. Today it's between 25% and 35% and it's headed upwards to 50% , this is a huge growth opportunity for these companies. You know sometimes people say to me that Google doesn't care about the cloud because it's such a small piece of their business or well they can't be number one or number two so they'll exit it. I don't buy this for a second. This is a trillion dollar business. Google is in it for the long game, and in my opinion, is going to slowly gain share over time. All right let's wrap up by looking forward to 2020 and beyond. The first thing I want to say is feel good for Google for reporting its cloud revenues but I think Google has to show more in cloud. I understand it's a good first step but IT buyers are still going to want to see more transparency. The other point I want to make is we are entering a new era the story of the past isn't going to be the same as this decade. Buyers aren't afraid of cloud anymore. It has become a mandate. The dominant services of the past and compute storage and networking to still be there but they're evolving, to support analytics, with AI and new types of database services. And these are becoming platforms for business transformation. Competition is, as we've seen, much more real today. Buyers have optionality. And that's going to create more innovation. SaaS, continues to be a huge factor but more so than ever. And hybrid and multi cloud is increasingly real and it's become a challenge for IT buyers so, I expect AWS is going to enter the ring in a bigger way to expand its Tim. Finally developers are no longer tinkerers, they are product creators. Now they said, there's a huge market. And the big tree can all participate as well as overseas players like, Ali Baba. As a customer it's becoming a more and more complicated situation. Cloud is not just about experimentation or startups it's increasingly about something that you really need to get right. Where to bet, migration and managing risks all become much more critical. On one hand, optionality is a good thing but if you make the wrong bet, it could be costly if you don't have a good exit strategy. Now as always, I really appreciate the comments that I get on my LinkedIn post and on Twitter I'm @DVellante So thanks for watching and thanks for your comments and your feedback This is Dave Vellante for the cube insights powered by ETR. We'll see you next time. (upbeat music)

>>live from Orlando, Florida It's the cue covering Microsoft Ignite Brought to you by Cho He City >>Welcome back, everyone. And welcome to the cubes live coverage of Microsoft Ignite Here in Orlando, I'm your host, Rebecca Night, along with my co host Stew Minimum. We're joined by Nicholas Djerassi. Moto's He is a cloud computing evangelist at Red Hat. Thank you so much for coming on the Cube. It's a pleasure. Thank you. So tell us a little bit about what you do at Red Hat. >>So I work with a lot of red, have partners really trying to foster the ecosystem and build red have products and solutions that can actually be deployable, repeatable for different customers. So different verticals. Financial health care doesn't really matter. For the most part, I try and just focus on cloud computing and really just evangelizing a lot of our technologies that we have. >>Okay, so So what are the kinds of things you're doing here at ignite? >>So I've been spending a lot of time actually working with some of the partners, like a center IBM. We've been doing a bunch of different webinars a little bit of hands on workshops that kind of educating people about distributed computing edge computing on dhe some of the technologies that we've been working along with Microsoft. So, uh, co engineering of sequel server The man is service offering that we're doing with open shift, which is our enterprise great kubernetes platform along many other >>different things. So So, Nicholas, you know, it's been a couple of years now that we've gotten over some of the gas. Wait. Microsoft has not said that, you know, we're killing the penguins, you know, off on the side. I was in Boston for Red Hat Summit. Tatiana Della's up on stage there, you know, Red hat. You know he's not hiding at the show. So bring us inside. You know where customers deployments are happening where engineering efforts are working together. You know, we know we've been hearing for years red hats in all of the clouds and partnering all of the merit. So what? What, you know, different or special, about the Microsoft relationship? >>I mean, honestly, I think the relationship is just evolving and growing because our customers were asking for it right there, going towards hybrid and multi cloud type of strategies. They want to be able to take advantage of, you know, running rail within their own data. Centers were running rails specifically on top of Microsoft Azure, but they're also looking at other club service providers. I think it's gonna be mandated eventually at some point in time where customers are gonna start looking at diversification when it comes to running applications, wherever it makes sense, taking advantage of different you know, cloud end of service is different providers. So we've been getting a lot of time like understanding what their needs are and then trying to build the engineering to actually address those needs. I think a lot of that has really come from the co engineering that we have going on. So we have a red head engineer sitting alongside bikers, off engineers, spending a lot of time building things like the Windows distraction layer wsl things along those lines, All >>right, so I'll be a Q Khan in a couple of weeks and kubernetes still, a lot of people don't really understand where it fits Way have been saying in a Cuban eight is gonna be baked into every platform. Red hat, of course, is not really a major contributor but has a lot of customers on open shift. We had Microsoft, you know, this week, talking about as your arc is in preview. But you know, they're they're the David Taunton who does partnership, Engagement says. You know, this does not mean that we will not continue to partner with open shift in the best place to run open shift is on azure. It's the most secure. It's the best. So help us understand his toe. You know where this fits In the overall discussion of that multi hybrid cloud that we were talking about earlier. I >>think everybody wants kind of a single pane of glass for manageability. They want ability to actually look and see where their infrastructure is being deployed. One of the pitfalls of moving to the cloud is the fact that it's so easy to spend a resource is that a lot of times we lose track of where these resource is. Our or individuals leave companies, and when they leave, cos they leave behind a lot of leftover items and instances, and that becomes really costly over a period of time. Maybe not so bad if you have, you know, 100 or 500 instances. But when you talk to some of these enterprise customers that are running 110,000 instances and spending millions of dollars a month, it could get very costly. And not only that, but it could also be a security risk is well, >>so let's talk about security. What kinds of conversations are you having with regard to security and data protection at this conference? >>So you know, one of the biggest things that we've had a lot of customers asking about his redhead insights so ready in sizes away it's a smart management application that actually ties into looking at either workloads or configuration management. It could actually tell you if you have a drift. So, for example, let's say you install sequel server on well, and you miss configure it. You leave the admin account running on it, it can actually alert you and make recommendations for remediation. Or maybe in general, you're using you know, S E. Lennox is disabled. The things along those lines so insights can actually look into, uh, the operating system or the applications and tell you if there's miss configurations all right, >>a lot of discussion about developers here, You know, day to keynote was all about, you know, AP Dev And, like Sathya have been a lot of time talking about the citizen developer. Seems like that would be an intersection between what red hats doing in and Microsoft. >>Um, so I would say, you know, we're obviously very developer first focused right when we built things like Open Shift Way kind of. We're thinking about developers. Before you were thinking about operations, and later on, we actually had to build more of the operations aspects into it. Now, like, for example, in open shift, there's two different portals. There's one for the developer Focus and one for the I T admin focus with operations groups because they want to see what's going on. Developers don't really care specifically about seeing the distraction of where things are. They just want to deploy their code, get it out the door as quickly as they can, and they're really just not too concerned about the infrastructure component pieces. But all of these developers, they want to be ableto right there, applications right there code and deploy it essentially anywhere and everywhere and having the easiest process and We're really just trying to make that as simple as possible, like visual studio plug ins that we have for open shift, you know, Eclipse G and other things. So really, I mean, Red has always been very developer focused first, >>so does that seeing Microsoft Satya Nadella up on the stage talking about this developer first attitude that Microsoft is really embracing the developer. And, as you said at development for all that does seem like a bit of a cultural shift for Microsoft much more aligned with the red hat way and sort of open source. So are you talking about that within without your cut with your colleagues? That red hat, about the change that you've seen the evolution of Microsoft? >>Absolutely. I mean, if you look at, like Microsoft, the contributions that they're putting towards, like kubernetes or even contribution towards open shift, it's It's amazing, right? I mean, it's like the company's gonna complete 1 80 from the way that they used to be. There's so much more open the acquisition of Like Get Hub, for example, all these different changes, it's it's amazing. He's done amazing things with the company. I can't say enough positive things about all the wonderful things that he's done. So >>all right, so Nicholas Red Hat has an interesting position in the marketplace because you do partner with all of the clouds on the environment. While IBM is now the parent owner of Red Hat and they have a cloud, your customers touch all of them. I'm not gonna ask you to competitively analyze them. But when you're talking to customers that are choosing Azure, is there anything that calling out as to why they're choosing Microsoft where you know they have, you know, a advantage of the marketplace or what is drawing customers to them on then? Of course, redhead. With that, >>I think Microsoft is more advanced when it comes to artificial intelligence and machine learning. A, I and ML and computing. I think they're light years ahead of everyone else at this point in time. I think you know, Amazon and Google are kind of playing a little bit of catch up there, Um, and it's showing right. If you look at the power platform, for example, customers are embracing that. It's just it's fantastic looking at a lot of the changes that they've implemented and I think it's very complimentary toe the way that people are starting to build their applications. Moving towards distributed infrastructures, Micro Service's and then obviously cloud native service is as well >>in terms of the future will be. We are really just scratching the surface when it comes to to the cloud. What do you see 5 10 years from now in terms of growth rates and also in terms of the ways in which companies are using the cloud. >>So I kind of like Thio equate it towards, like, the progression that we've had with cars. I know it sounds so simple, but, you know, we went from steam engine to regular piston engines, and now we've gotten to a point where we have electric cars and there's gonna be self driving cars. I think we're gonna get to a point where code is gonna be autonomous in a sense, right self correcting ability to actually just write code and deploy it. Not really having to worry about that entire infrastructure layer. Everybody's calling it server lists. There's always gonna be a server per se, but I think we're gonna have a point where next 5 to 10 years that all of that is gonna be completely abstracted away. It's just gonna be focused on writing the code and machine learning is gonna help us actually evolve that code and make it run faster and make it run better. We're already seeing huge benefits. And when it comes to machine learning and the big data analytics and things on those lines, it's just natural progression. All right, >>love, you know what's top of mine from the customers that you're talking to Earth event. Any new learning is that you've had or, you know, things that have kind of caught your attention. >>I think the biggest thing, honestly, is really been them. The multi cloud Polly Cloud methodology that everybody seems to be embracing. It seems like every customer I'm talking to is looking at trying to avoid that vendor lock and per se, but still have that flexibility to deploy their applications wherever and still utilize cloud Native Service's without actually specifically having to, you know, go completely open source >>and one of the challenges there is every cloud. I need different skills to be able to do them. If I'm deploying it, it's the people and being able to do that. You know, we all lived through that era of trying to do multi vendor, and often it was challenges. So have we learned from what we've done in the past? Can multi cloud actually be more valuable to a company than the sum of its parts? >>I think so. And I think that's the reason why I, like Microsoft, is investing in art. For example, I think those methodologies way No multi clouds, tough. It's never gonna be easy. And so these companies need to start building in developing platforms for it. There needs to be be great if there were standard AP ice and such right, but they're never gonna do something along those lines. But I think the investments that they're putting forth now are gonna make Multiplied and Polly Cloud a lot easier in the future. And I think customers are asking for it. Customers ask for it, they're gonna build it. >>What does this mean for the workforce, though? In in terms of the kinds of candidates that cos they're going to hire because, as we said, it does require different skills and and different capabilities. So how what's your advice to the young computer scientists coming up in terms of what they should be learning. And then also, how do you think companies are making sensible of this? >>So I know from a company respectable. It's challenging a lot of companies. Especially, for example, I was talking to a very large financial institution, and they were saying that their biggest issue right now is hiring talented people to deal with Micro Service's kubernetes. Any time to hire someone, they end up getting poached by the big cloud companies. So you know, it's one of those things where people are gonna have to start diversifying their talents and look at the future. So I mean, obviously, Micro Service's are here. They're gonna continue to be here. I would say people should invest in that. But also look a server Lis, you know, I definitely think serverless these days towards the future. And then when it comes to like learning skills of multi club, I think cloud competing, that's just the number one growing in general. >>So since you didn't bring up server Lis, you know, today I hear serverless and most customers that I talked to that means a W s number two in the space probably is Microsoft, but there's efforts in to try to help, you know, give a little bit of open source and standardization there. Where's Red Hat? Stand on this. What do you see? What from Microsoft? What are you hearing from customers? >>Were heavily contribute all the different, you know, projects, trying to make server lists like easier to use and not so much specific vendors, Right? So whether that's, you know, Apache, spar or whatever you want to consider it to be, were trying to invest. Invest in those different types of technologies. I think the main issue we serve earless right now is we still don't really know how to utilize it effectively. And it's still kind of this gray area in a sense, right? It's cutting edge, bleeding edge emerging technologies. And it's just, in my opinion, it's not perfectly ready for prime time. But I think that's specifically because there's just not enough people that are actually invested in it. This point in time. So >>So what are you gonna take back with you when you head back to Phoenix from from this conference? What are the things that have sparked your interest the most. >>Gosh, I live, I would probably have to say, Really digging in deep on the Ark announcement. I think that's the thing that I'm most interested in, understanding how how we can actually contribute to that and maybe make that plug double for things like open Shift. You know, whether it's open shift on premise, open shit, running in the cloud on another, Well, architecture's, you know, things like insights. Being able to plug into that, I really see us trying to work with Microsoft to start building those things. >>Well, Nicholas, thank you so much for coming on. The cubit was really fabulous conversation. Thank you. I'm Rebecca Knight for Sue minimum. Stay tuned for more of the cubes. Live coverage from Microsoft ignite.

>>Live from Orlando, Florida. It's the cube covering Microsoft ignite brought to you by Cohesity. >>Welcome back everyone. We are wrapping up three at days of wall to wall coverage of Microsoft ignite. It is a game day atmosphere on the show floor at the orange County civic center. Thank you so much to Cohesity for hosting the cube for this fantastic three days. I'm your host, Rebecca Knight along with my co host Stu Miniman. Still this is awesome. We talk about the buzz on the floor and the energy on the show and definitely guy here Cohesity always bright and activity >>in the booth and it's been a lot of fun hanging out here for the week with you Rebecca and our hosts and all, all of the guests. Yes, absolutely. So this is day three. We are starting our series of interviews, but I want to hear because you are so in this community you have a lot of connections, a lot of buddies, a lot of colleagues, former colleagues, current colleagues. What has impressed you about the show and what is missing? Let's start with the positives and it's interesting because this is only my second year coming. One of those, you know, my background networking, I've interacted with Microsoft for most of my career. I would not say I am deep in the community, but I know enough of the MVPs, have friends here and really have learned a lot in these two years. So first of all, the breadth of this show is just so impressive. >>One of the things that you and I've been talking about the last two years, years, what is the show? It started out as a windows admin show. Lot of discussion about office migration to windows 10 was the big thing last year. We haven't heard as much about this this year. Yesterday was a big developer day. Of course Azure sits at the center of everything. Lots of big announcements here. Felt like a kind of on par with what we hear at AWS. It shows with just so many announcements across the board. But really when you talk about the applications of business productivity, people come to this show. When I talk to people in the booth, I'm looking for solutions and how do I put those together? It's not some of the tech shows where you just, you're constantly down in the speeds and feeds and what they're doing and some of the competitive dynamics. >>I have a problem, my business needs something in, this is what I'm looking to solve. And Microsoft has a broad and diverse ecosystem and the word we kept coming back to the word of the week I think is of course trust. >> Absolutely. I couldn't agree more with what you've just said. That is what we hear. And the other thing about Microsoft is that at a time when big tech is really under a lot of fire, there's a lot of suspicion policymakers, regulators are bearing down on a lot of the tech CEOs. Microsoft really stands above. And when you think about antitrust, there's major presidential candidates talking about breaking up big Chuck, big tech. Microsoft is really riding above that fray. There's sort of a feeling of deja VU for Microsoft, I'm sure. But that they're really been there, done that. They're not. Yeah, I mean it was Satya Nadella to, you know, really put a pointed attack. >>He did not say it, but we all know it's Google. You know the company that was do no evil at the start. Now everybody's concerned because Google's model is primarily selling ads and while Google will say what they're doing in the enterprise, they just acquired Fitbit and said, you're not going to get ads on your Fitbit. We're not going to leverage that way, but there's not that trust built up. And then the number one competitor out there is AWS. And if you talk about the ecosystem, the concern that every AWS show is, Oh my gosh, what announcements are Amazon going to make and are they going to steal my lunch money if you were or put me out of business for the years worth of work on doing. Microsoft doesn't feel that way. They, you know, if you talk about the ecosystem I was talking, they made announcements that do compete against number the products, RPA, or was announced as part of the power platform out there. >>There's a number of RPA companies here. I talked to them there. Microsoft's a strong partner. We've been doing breakouts, we're talking with them. Yes, they are just like SAP getting into this market, but it's a Microsoft shop and it's not, you know, it is new. It's not the best of breed. They're on it. They are not concerned that they can still live in this environment. And I'd say both AWS and Azure very much about choice and ecosystem and building them out. >> So you're talking about the marketplace here. So in terms of the marketplace, what is Microsoft doing to drive business and is it effective? Well actually I'm glad you, so specifically we talk about the marketplace. So there's the ecosystem and then there's actually the marketplace. So AWS has what we really consider, it's the enterprise app store. If I want to go buy software, you know there's Salesforce and all of their connectors and everyone that uses Salesforce knows that. >>But AWS really has driven a robust ecosystem just like on amazon.com most of the products that are sold are from third parties. The AWS marketplace is mostly how I can procure and buy software. And they drive a lot of it. So a lot of the AWS adoption is through the marketplace and the ecosystem makes lots of dollars. Reminds me, we used to talk about VMware for years is for every dollar of VMware you bought you would buy, you know, 10 $20 worth of third party ecosystem. But we were talking about things like storage and like for AWS it's on procuring software and underneath on leveraging the AWS services. While Microsoft Azure has a marketplace, it is not as mature. They don't really push as many people through it. So while I've talked to a number of the partners that are, yes we're part of the marketplace, but people buy lots of different ways as opposed to AWS is trying to get everybody from a customer and an ecosystem through it. >>And part of that is to simplify the environment, how I purchase it. But it's that balance of trust and you know, ease of use out there. So when I look forward, what do I like to see from Azure is how will they mature there. I was actually something John furrier had had us digging into here and the marketplace at Azure definitely is, I would say years behind where AWS is, is there, but you know, Azure great growth, doing really well, a strong trusted ecosystem. Just some areas for improvement that I would look for going forward. >>But maybe that's part of their, their approach and their strategy is we'll work with you, we, we collaborate, we can do this together. Whereas AWS there is that, that feeling sometimes when you're at reinvent, as you said, roll out the beer, CURT's early please. My business is over. So, so, so comparing the two show, the three, the various cloud shows, and this is not just a cloud show, of course we're going to get into that more. But when you think about re-invent and you think about VM world, how does the, the feel and the energy here differ? >>Yeah. So the thing that always strikes me when I go to an AWS show, and I have been to many of them from the regional shows through the big one and reinvent, which is more than twice the size of this 26,000 person show. The customers there are always trying new things. They are open and looking for the environment that they can do new things. Here what we're talking about here feels like it's like a tweener. We had a lot of conversations about building bridges to where customers are while AWS is starting to talk hybrid more and meet you in your data center and doing outpost Microsoft, they have their windows install base, they have their own three 65 pieces. So there's a broad spectrum of from the latest and greatest autonomous systems. You want to talk about it. Microsoft has that through, you know, I'm a, you know, 20 year CIS admin and I, you know, I'm going to hold on to, you know, my servers, you know, as long as I can, they're there for you. >>So Microsoft does bam, that gamut and VMware is more, once again making that transition as we go to the cloud. So Microsoft right in the middle of that transition, we talked a bunch about digital transformation with the customers on here. So it really, it has all a lot for a lot of different people. You know is one of the things I've heard is they really ramped up some of the developer activity at this show. They just bought get hub, get hub, has their own show, get hub universe next week, which will stay very focused on that environment. But Microsoft also has a conference build and there's been some rumblings that maybe build an ignite get wrapped together. We saw that with IBM. IBM had lots of different shows and they put all the wood behind think and made that a massive show. There's pros and cons of that, seeing lots of companies that have taken a big show and put it into a 40 show around the globe. >>Now someone like Amazon has reinvented, but then they have of second tier and third tier regional shows to push that out. So lots of different ways to, to get to customers. Um, and it is interesting, you know, we spent a lot of time talking about Azure Ark. I'll be at the cube con cloud-native clown show in just two weeks and San Diego and expect that to be talked. And really it is in preview mode. So when I look at it at the end of the day is, you know, you've got red hat open shift, you have Google, you have what AWS is doing with outpost and welcome to the party. Microsoft, they have got a strong hybrid solution already because they played at both ends. But really as your arc is unifying and pulling those together so that it's not just my data center and Azure, but even AWS, they're saying, we'll see how this all plays out. >>Microsoft definitely has a strong data focus and a strong application focus. And so it be interesting to see where that adoption happens. I've been saying for a couple of weeks. Really Kubernetes just get baked in everywhere and you know, customers aren't going to have to think about it in a most Microsoft definitely strong partner focus. Just to reinforce something I've said a couple times this week, they still have a partnership with red hat. They still have a partnership with VMware. The Azure arc is not the only way to get the Kubernetes story in play into your Microsoft environment. And Microsoft's done well with that. We all know from the early days of Microsoft living on tops of lots of hardware. Now Microsoft software will live a lot of places. Yes, their cloud is large growing one of the top two choices out there. But they truly embrace that it will be multi-cloud and be able to live in lots of environments. >>So I want to talk about something that's more in my wheel, hasn't met his productivity. So we have heard a little bit about teams. I mean there was a lot of announcements. It's not exactly where we focused a lot here on the cube this week, but there were some really interesting announcements about the ways in which Microsoft is thinking about human productivity, both at individual productivity and team collaboration, the way teams interact and communicate. There are a lot of interesting new uh, characteristics and elements to what they're doing in terms of Cortana re read me my emails. Uh, I'm going to send this email but I'm actually gonna wait, it's good. It's going to be a scheduled send. It's going to send when the, when the, the person I'm sending it to is, is actually at his or her desk. Um, and so those are just some interesting things to me that really speak volumes about how Microsoft views the future of work and views the, the future of our, of our lives. And, and, and understanding how much technology has encroached in our lives because they're saying, read me my emails while I take my dog for a walk while I am actually doing, while I'm on a run first thing in the morning. I, you know, make me more productive but also give me my time back. And so I think those are some really, really interesting ways in which Microsoft, as I said, understands the technology has taken over and they're trying to give you a bit of your time back. >>It's interesting cause you know when I look back, Microsoft has a bit of a checkered history when it comes to some of those environments. We all know the office suite teams is now part of O three 65 and I hear very strong. The people that use it really do like it. But those of us look back and we said, Oh I used to like using Skype and then Microsoft got ahold of it and Oh my gosh, what a horrendous mess. Skype was for a long time when it taught to a collaborative environment. Google really jumped Microsoft with the G suite and many smaller companies were like, Oh, it's relatively easy to use and I can collaborate there. Well teams really has gone through and understand that and we talk about a collaborative environment, you know, Microsoft teams, best of breeds. I attended an enterprise connect earlier this year and I couldn't hear enough about how much that was going on. >>And you know, strong ecosystem of companies that Microsoft worked with. So it's very strong, but it's kind of, if you're a Microsoft shop, you're doing it. But they did lose many companies too free or less expensive or lighter weight options out there. And then everything from Slack ate into it. But you know, Microsoft has a good product. Absolutely. It just, some of it is the perception and some of it is the pricing. You know, they do a good job of making sure that when you get get to college, you, you want to use some of these environments. Oh yeah, the pricing is graded free. But then when you get in the real world, hopefully you'll like it. So Microsoft does a little bit about now something we focused a lot on but did hear really good things about it. And it does get lost a little bit in some of the general discussion about all the other pieces, you know, autonomous systems, AI and the leaders. This stuff of Azure take a little bit of precedent over the, some of the things that are a little bit more on just as you said, business productivity or even on the consumer side of the house for Microsoft. >>So we are, we're, we're wrapping up here but I want to hear just final thoughts, final predictions for 2020 and you've really gotten, you've, we've, we've covered a lot of ground here, this wording, but I'm interested to hear what you think is on tap for Microsoft in 2020 I'll bring >>back to something we kicked off with the jet ideal coming in here really has that that whole process of winning that bid was a fortune function from Microsoft to rapidly mature some of their environment. You talk about security and trust, you know the government is not going to give that environment if it to Microsoft, if they could not trust them. Back when AWS won a CIA deal, it was like, Oh wait, if the security is good enough for the CIA, it's probably good enough for me to consider it. So the government agencies, which historically is not who you think about when you talk about innovation in driving change today. Public sector is really interesting. Even when we were talking to some of the people about, Hey, how can we haven't heard as much about Azure stack over the years? Well, it's been a lot of service providers and government agencies that have been deploying this and therefore we'll do it. So Microsoft still has a lot of work to do contracts. They still have to get some more security clearances. They need to make sure their performance and reliability is up to snuff on because they just can't have outages. If I, if this becomes a greater and greater piece of my overall how I run my business, I can't say, oops, wait, you know the Internet's down. This is now 2019 going into 2020 and in 2020 we'll all have perfect. >>Oh, of course. Oh yes indeed. Sue, I'm looking forward to another great day of coverage with you, and thank you again to Cohesity for hosting us in this really cool booth. Uh, so please stay tuned for more of the cubes live coverage of Microsoft ignite coming up in just a little bit.

>>Live from Orlando, Florida. It's the cube covering Microsoft ignite brought to you by Cohesity. >>Hello cube nation and welcome to back to the cubes live coverage of Microsoft ignite here in Orlando, Florida. I'm your host, Rebecca Knight. Along with my cohost Stu Miniman. We are closing down the second day of the three days of coverage. This is day two >>wall to wall to wall coverage. Joining us is Thomas LA rock, best job title ever, head geek at solar winds or speaker data expert and SQL rockstar and Microsoft MVP and Microsoft MVP and yes importantly and you saved me. You didn't have me on yesterday. You waited to the second day, the end of the second day. Thomas, we wanted to make sure that by the time you came on that you had got some time to really absorb some of those announcements and be ready to give us a different perspective on some of the items. All right. Precisely. So this is your 10th Microsoft ignite. It is my first go back to tech ed 2010 so yeah, my 10th consecutive between tech ed and McKnight. Thoughts, impressions of 2019, how is it different? How is the show evolving? What does the show all about? So your perspective, you know, I do a lot of events and shows and what my impression right now just over these two days is that this is one of the only shows this year I've been to where I feel the from year over year, the expo hall is say bigger. >>I mean I know it's the same size the last year. I think there's actually more vendors here this year. There are, and there's more people here. This year in the expo hall. Our traffic at the booth yesterday was amazing and continued through today. Uh, other events I've been to, I feel it's kind of shrinking a little bit. So to me the partners and the ecosystem for Microsoft in general is grow or I should just say Azure because that's what I think this show really is. Now I think the old tech ed you had mentioned was more like a windows type a show. But now this is th these shows between AWS and this, you're talking about the two biggest providers of infrastructure. This is an Azure show. Yeah. Well and Thomas, if you come follow us along, I'll be at CubeCon in two weeks and I'll be at AWS re invent. >>Yup. Right after Thanksgiving. Both of those shows are growing. The ecosystem are growing there too. So the cloud is definitely one of those. The raising tide is moving all boats. I want to poke you say Azure. Azure is definitely one of the main pieces, but you know, the applications that data are so important to your last year. AI front and center. Um, it was, it was more, you know, they didn't use the term AI as much here. You know, Satya, I was talking about, you know, tech intensity and all of the things we can do with data. So this, while a cloud is a major piece, I wouldn't call this just a cloud show because I think that would limit what we're actually talking about here. Cause there's so many of the apps and so many of the things. When I talked to some of the ecosystem providers, you know, they're looking for that solution that fits it and therefore they're go into the ecosystem and talking about all of those pieces. >>So for an infrastructure guy like me, cloud's a big piece of it, but it's way more than that. And that's one of the challenges is there's, you know, everything from, you know, the latest Azure arc all the way through big edge and mobile devices and, uh, you know, heck, there's even, you know, in the store they've got people playing Xbox. Uh, so it's, there's a lot in your Microsoft community here. So. Absolutely. So I, I didn't say cloud though. I said it's an Azure show. And then as your show is to me is almost synonymous with Microsoft and all that stuff. You see, uh, over there, that entire hall, you're right. They have all those other things. They have the, all the power apps, they have those applications, they have everything for developers that you need. But still to me, uh, so what was that stat you just gave me? >>We were debating, it's roughly eight upwards of 80% of workloads are still earth on premises, right? It's still there. So with Azure Ark now they have the ability to take an Azure surface and put it in your data center wherever you want it. So when I say it's an Azure show, it's not even that. It's just cloud. The cloud is coming to you and we see it with VMware, we see it with AWS and outposts that they have decided that 80% is a huge market and they're coming for it. Right? So, so Thomas, if you'd asked me two years ago, uh, which of the hyperscale providers as best as hybrid, my answer would have been Microsoft because they're in both places. The hybrid discussion at this show is way different. There was a lot of retooling. We talked about what was going on. Azure stacks has been there, but arc kind of is a new big push and everybody is trying to look at that and say, wait, is this a management tool? >>Is this just the latest Kubernetes flavor? In your viewpoint, how does arc fit in the Microsoft story? And you know, what should we be comparing it to from the other Amazon, VMware, you know, red hat type of pliers out there? Well Brian, >> I think it's the same thing is that, I was just saying is that arc to me, we can talk about the plumbing. So yeah, they put a fancy name on whether it's Kubernetes, Coobernetti's and all that stuff, but no arc to me is a way for Microsoft to get their hands on as many data estates as possible. Right? I know data state, right? I have a data state and it's next to my data Lake and I work at the data factory and everything's stored in the data warehouse and I shop at the data Mark. We can go on forever with this stuff, but that is the reality of the world. >>And the thing is all those things exist and they're, as your arc is, it's the ability to extend into there because what is Azure and AWS, they're nothing more than an electric company. Their utility and the utility, you're going to offer similar services and that's what they have. And of course VM Ware's in the mix as well. And it's just the ability for all those companies to have their hands on your data, wherever it is, whether it's in your data center or with them, they don't care. They just want the ability to have a piece of that data as it's in transit or at rest. >>And so what's the end there? I mean, you're making that sound like there's some sort of nefarious, uh, end game here. >>It's, I wouldn't say so. Farias I would just say it's market share. What's the end is to survive, to have the market share, to continue to build new cool things. Right. Um, I, I think the end is some consolidation. I don't think the end is, I don't know. Let's say there's five major players. I don't think those five will always exist. I think the are gonna see it shrink over time, but it really, that depends on how well they partner with each other too. Um, I think there's room for everybody, but it's just depends on where they want to say, um, if they want the co-exist or not. Right. So for some of them like VMware, that's really just kind of software, right? They're partnering with clouds. But the clouds are the infrastructure hose. And so how long does VMware really have? Now they've done the nice pivot and I think they're going to last a little bit longer. >>But had they not taken that pivot in the last year or two? I think their timeline with a much shorter, yeah, it's interesting cause we've been looking at, you talk about that cloud adoption, some of the traditional vendors out there, um, many of which are, you know, ecosystem providers that have show here it has to react and deal with the cloud. You know, everybody's jumped on the Kubernetes fly and bandwagon. Everybody's partnering especially with Azure but also AWS and the like. Um, you know, Thomas, you and your company deal with a lot of end users out there. What are they looking for when it comes to being a trusted provider? You know, who, what, what, what's there and how does Microsoft stack up? When we talk about that Satya talked about trust a lot and you know, just curious to how you see them being perceived out there and you know, when customer want to lead partner, what do they want? >>Well, uh, for us, we have, uh, I believe over 300,000 customers at this point and, uh, I think roughly 53% of them are Azure base and that's a higher percentage than what we have for AWS, for our customer base. So we have taken steps to be that trusted partner. So when these companies are going to take that 80% workload that isn't there yet, uh, just in the booth discussions this week where they come to us and they say, Hey, we're going to owe three 65, how can you help us? We're going here at small steps at the time, so that workload that will chip away at it, but we're a company that can help with that transition as people move their workloads and their systems into a place like Azure. Uh, I think what you're gonna also see is our ability to, um, help people understand wherever they want their for structure. >>So for example, last week we announced how we have 15 of our products are now, um, deployed to the Azure marketplace. So you're talking two clicks and everything's deployed for you and you're up and running. And then if you want, if you want to, you know, manage the nodes that are still in your data center, you can just point everything to go up to Azure and Azure, handle a lot of those infrastructure needs for you. So that to me is the trust where you partner with a company like Microsoft and you say, what will it take for us to get in the marketplace? What will it take for us to help help us help, help us help you get that data into your data, into your cloud, right? I think our customers really want to know that when it comes to, Hey, I got to go to Azure. Are you somebody who could help us get there and stay there and manage and monitor the stuff for us? >>I want to talk productivity because I think you have a pretty different take from Satya Nadella. So he had a, he on the, on the main stage yesterday, he said the human act, human attention to inattention is at the root of all productivity. He's, he laid out a stat when you multitask it takes 25 minutes. I'm sorry I got distracted. So it was a 25 minutes. Yes, 25 minutes and you lose 40% of your productivity with that 25 minute lapse. So I w I felt that compelling and that rang true to me. But absolutely >>it's true. So right after he got done with that, Microsoft told us the answer was they were going to take Yammer and shove it inside teams on a shoving inside outlook. I don't think we need more productivity tools. I don't think we need more ways of distracting us. They say they say, Hey, it's great. We'll put tasks from outlook right inside teams. I'm like maybe I'm in teams cause I shut down outlook because I'm distracted by email and other things right now maybe I don't need that. Is it a nice to have and it's a possible thing I guess, but at the end of the day, I don't need you shoving all these extra things into all the things. You're just making the problem worse. We need fewer productivity tools. At what point do we hit peak productivity? I guess? I think we're there. I think I have all the tools that enable me to do my job already. I don't need them all tightly integrated. I need to shut more things off. Right. In order to get stuff done. >>That's a, that's an excellent point because when I want to get work done, I go to a place where I can't get online. Right. Because that's, that's the biggest, >>that's why, uh, I work remote from home one that one of my advantages is I don't have people just walking by my desk and, and distracting me with all sorts of things. That's a huge advantage. I try to take advantage of what, cause I work remote, but for people in an office, bells, whistles, lists that and the other, you know, uh, I just, I get a cup of coffee. You know, it's, it's difficult and I'm not sure that these companies, not just Microsoft, I just don't think companies are really thinking through if they're making things better or not. Every one of them Slack, all of them, they all think that they're the one that's all you need. It's not true and it's not making things better. Yeah, it's a true, we've had good feedback about teams overall here. Especially you've talked to a number of people that are remote workers and they feel that that does help them get connected with teams and, uh, you know, in the remote areas and by itself, but, you know, create point, uh, on the productivity stuff too. >>Do you use teams to use teams? Uh, kind of reluctant at first, like, do I need the another tool? But now that, uh, we've all kind of started switching to it and my company went O three 65 as well. Some teams comes with it and, uh, I do find that very useful, um, uh, much more so than I have any of the other tools in the past. I think teams took a lot of good things from a lot of different tools and they rolled out of them to the one they, and it works for me. It doesn't work for everybody though. Right? >>Exactly. Exactly. So what, so what else are you taking away from the, from your 10th ever ignite, you go back to the office, but is your home on Monday? What kinds of conversations are you going to have most stayed with you, have most resonated you? Okay. >>For me, uh, I, I focus a lot on the data platform and uh, I think the thing that's going to resonate the most with me, it really is Azure arc and what that, what the, what that really means and getting a little more involved with, uh, understanding where they're headed with it. Like just the idea they're going to give me that one management console that can control everything. Earth and cloud. Uh, that's an interesting thing. I see. Come at me. I work for a tools vendor, so as a tools vendor, I'm sitting there going, so Microsoft's building something that gives visibility into both. Now, what does that mean for me and where we might, we want to think about pivoting to make sure that we stay ahead and keep offering value where Microsoft might have a gap. Um, so I think those are the things I'll probably be thinking about. >>My role as head geek is to, you know, help our users and the people who write the code and, you know, connect, share and learn and figure out where things are going. And also involves partnering and having conversations with folks at Microsoft, uh, to help our company, you know, continue to have that edge. So I think that's all I'll be thinking about on Monday, probably now on the plane ride home on Friday, but who knows, right. Uh, Thomas, any other final words about the community here? Uh, you know, you're a Microsoft MVP is we set up in front, uh, you know, Microsoft should get great kudos for, they put the unity in community and they talk about diversity and inclusion, something they highlight something that, at least from the viewpoint we've had, uh, they seem to be doing a good job in moving the needle here. >>But, uh, you know, as an insider to the Microsoft community, uh, anything particular that you'd call out? Well, certainly the changes and the emphasis I've seen on diversity inclusion over the years. You're absolutely right. I think, I know this, you were having some interviews earlier to have those specific discussions and, uh, it's an important conversation to have, uh, uh, as somebody who organizes events, it becomes, you know, what's the diversity, how diverse should the event be? At what point are we diverse enough? Right? And what does that really mean? And so I look at it and I say, if I'm going to run an event that caters to say an it community, well, what's the makeup of the it community? Then the speakers should represent the community that they're trying to speak to. So what I've seen over these 11 years is a lot more focus for events, especially like ones I help organize where it's like, no, what I'm going to go out and recruit the speakers that I need to represent the people that I want them to be presenting to. >>Uh, I don't think I will recall that I'm old. I don't recall a lot of things, but you know, 11 years ago when I was, when I joined to became an MVP, I, I don't think that the diversity was there and I don't think the efforts were being done. I think those efforts have come just in the past few years, four or five years maybe society as a whole, but specifically inside Microsoft and, and their programs. And I think it's fabulous. Uh, I, I think you could never be diverse enough. I guess. I don't know how to say that. I think he could always do more to, uh, include, I always say inclusion is better than the exclusion any day. You can never do enough for that. And I think Microsoft's made great efforts. I'm, I'm really proud to call myself a Microsoft MVP. Uh, I, I think it's a great program. I'm glad that I questioned, you know, their selection method maybe because they keep inviting me back, but they do and, but I love it. I, it's been a great ride, >>a great note to end on. Thomas law crock head geek. Great. Great to have you on the show. Great. Great. Thanks for having me back. I really appreciate it. I'm Rebecca Knight for Stu minimums. Come back tomorrow for more of the cubes live coverage of Microsoft ignite.

>>Live from Orlando, Florida. It's the cube covering Microsoft ignite brought to you by Cohesity. >>Hello everyone and welcome back to the cubes live coverage of Microsoft ignite 2019 here in Orlando. I'm your host, Rebecca Knight, along with my co host Stu minimun. We are joined by Chris Weiberg. He is the vice president of product marketing at Cohesity. Thank you so much for coming on the show and for providing us with this great space, this prime real estate. We really appreciate it. >>Spot on the show floor and I hope this is working out for you guys here with uh, with all of us branding and so on behind >>it has been terrific as as we 26,000 people from around the world here at the orange County convention center. We'll talk about how the conference has been for you here at Cohesity. >>I think it's gone really, really well. I mean, apart from the loverly brute booth property we have right here, um, some of the keynote messages around the importance of hybrid cloud moving forward with what Microsoft's doing with arc and things like that, um, really resonate with how we see the market. So a couple of the announces we've made have been around support for Azure stack and for the AVS, the Azure VMware solution. And, uh, we, that's just what we see with our customers across the board. And I think Theresa actually mentioned this yesterday, that if you look forward at most organizations cloud journey, they end up somewhere in that hybrid range, right? They may not all be there today and maybe just a little bit of sass, Ooh, three 65 to start off with, for example. But, you know, looking ahead, unless you're natively born in the cloud, and that's typically small organizations. Most mid to large enterprises are hybrid cloud, >>yours that are not as familiar with Cohesity, which is a company that has growing from strength to strength. Tell us a little bit about what >>yeah, yeah, yeah, sure. So, uh, we are very much a software defined data management platform. And typically when I say that to people, I get blank stares to begin with, right? But let me, let me tell you really what we've thought about. And, and this goes back to, um, the heritage of our founder. He, uh, before he cofounded Newtanics, he was the lead engineer on the Google file system. And the, the philosophy has for Cohesity and the direction that we're going is very much based upon his experiences there. If you build a shared nothing distributed file system and you do that right, you establish a great platform to build upon, right? And so if you think about what Google did, they did that, um, with the file system that today runs many things, right? Uh, Gmail, YouTube, all the G suite apps. Um, but the first thing is, is they built that file system and then they figured out how to manage that in a distributed fashion, right? >>Because of their points of presence are all over the, the globe these days. Uh, and then on that they started delivering applications. But if you think back, the very first application Google delivered was what the search, right? That's, that's how that became known as, as, as a company, as Google search. And, and so for us, we're taking that same mindset towards dealing with enterprise data. So if Google does a great job with data and the consumer world for the, that they own and operate, organizations don't have that luxury of having Google come in and crawl and managing index all their data, right? We can help do that. So the journey begins with the genius behind our distributed file system that we call span Fs. And that's what a lot of the intellectual property has gone into is building that file system of that truly is, um, that's shared nothing architecture scales from a on-prem in your data center, core to the edge to the cloud. >>And then being able to produce a manageability layer on top of that, something we call Helio's that manages all the data across various sites you may have managed by Cohesity. And then our first app, if you will, on top of that platform really is data protection, right? So people may know as first and foremost as a backup and recovery company. And absolutely that's, that's something we're really, really good at. I would put us head to head against anybody else on the show floor here in, in that regard. And, and candidly, many large enterprise customers have done that with us and, and chosen us as their solution. Um, but I think from there the question is once you amass the data, uh, what can you do with it and, and how can you get more out of it? So if you look at backup and recovery, I think traditionally that's been largely viewed by it. >>Operators as an insurance policy, it's, there is something goes wrong. Uh, but we believe you can do more than that. You can not only have that insurance policy to help with things like disaster recovery and coming back from ransomware attacks and so on, but how can you do things like, uh, put analytics on top of it to get more out of it, get better insights out of it. Um, how can you have another customer? That store is all their customer care phone calls. It's a voice object, right? Kind of opaque, but they want to transcribe that. Why don't you do this transcription services on top of the data that you already have from that backup and recovery solution. And so, you know, get the data through backup, get the data through files and objects. I think David and I talked about that with you earlier. >>Uh, and that's a great way to start to aggregate and consolidate not only the data in your enterprise, but also all the infrastructure silos that are out there. And so that's problem one that we solve. And then we go from there. >> So Chris, when I think about all the various customers here, one thing they're dealing with, there's a lot of change. They've got their business challenges, whether it's adopting the cloud, looking at edge, right? Adopting containerization. Yeah. It's always defined by the change that's going on in their environment. Traditional backup and recovery was please don't change everything. I had my backup window, my administrator, I had the program that I'd used for 15 or 20 years that I trust. And I know, and I please don't sneeze on it because I've got it the way that I like it over the last like five years. >>Companies are because of that change. They're, they're looking at new solutions, they're looking at other environments. Tell us how Cohesity's riding that wave to move, you know, not like the enterprise is moving. Enterprises are moving fast. Right? But they're at least looking and that if they don't make some move, uh, you know, everybody else has, has moved along, so they need to at least be a little bit more agile and fast. >> Yeah. Well, I think, uh, you know, first of all, thank you for realizing that oftentimes our number one competitors that do nothing option, right? It's, I've done this forever, this way. Why change? Um, but, but to your comment about, you know, the backup window, well, there's no such thing anymore for most companies. It's seven by 24 by three 65. And so that alone I think is causing people to step back. And say, Hey, is the way that I used to do things still the right answer or is there a better way? >>And, and so that's often the beginning of a conversation we'll have where, you know, maybe, uh, their, their current, uh, contract with an existing provider is coming to a point where, uh, there's a window for renewal and they, and they want to look at something different. Um, but, but I do think, you know, and we had a customer panel earlier today at the show were a couple of law firms are talking about this. They just don't have the luxury of time they used to to deal with this. And so that, that sort of causes change whether you like it or not. And so that's often how we begin that conversation. Even though, to your point, these folks sometimes aren't the most, um, uh, risk embracing crowd in it, right? They're not on the bleeding edge all the time because if you're in the insurance policy, guys, you don't want to mess that up, right? >>Uh, but, but that's what we find is, is the disruption we're bringing in the market creates an opportunity to look at how you do things differently. Uh, w we had a, another customer panel back at VMworld in San Francisco this year where one of the customers had actually three different providers. One that was doing backup software, uh, one that was target storage and another that was the media gateways to handle some of their information. He was happy with all of those. But when he looked at that and he said, wait a second, instead of dealing with three companies that can do all the one and I can per data center eliminate about a half a rack of gear, he said that, that for me was it, that was a no brainer that led me to you guys. And so that's what we're saying. >>So we as a former it practitioner yourself, I'm curious to know how your background helps you get inside the brains of these people who are making decisions for, you said the do nothing option is compelling because? Because it's easy and yet it is the wrong way to go because in this ever changing world that that's risky in and of it. >>well it's, it's, it's always a risk reward balance. Right? And, and so I think whenever you're introduced to something new to the market and new concept, um, you ha, you feel the pain as, as a, as an organization. Cause you're having to educate people about there is a better way, right? I mean, I mean, think about, um, let's use Mohit form a company. Nutanix is an example of that. I remember the battles early on. People are scratching their heads, what is this HCI thing? I cause I do stories this way and I do, uh, compute this way and I do networking this way and I have my existing vendors, they put it all together and it took them awhile to get going. But when they did it that you really took off and, and I can think of multiple examples. I mean, Apple and the iPhone, what have you. >>Right. Um, and so I, we're sort of at that stage as a company where people are just starting to get their head around the opportunity we're putting on the table by disrupting the way things run and actually making their lives better. Um, and, and so it's, it's a, it's not just, you know, having an understanding of that from my background. Um, it's then being able to articulate the benefits, not just to the organizations looking to save money and do things more efficiently, but actually to the, the it operators themselves. Right? I mean, you talked to Theresa about this a bit yesterday. It burnout is a thing. And anything you can do to make manageability and automation easier, uh, the better off the folks actually doing the work are. And so that's something we care about deeply as well. It's not just, you know, saving money. >>It's, it's giving you a better way to do it. And, and ideally, uh, making, taking the complexity out of the puzzle you're managing today and, and making it easier. Simplifying it. So Chris, one of the challenges is as you were talking about, you can replace multiple solutions out there, but it means that there are multiple constituencies that you need to talk to and position your product. So, you know, with your marketing hat, how do you look at the roles and the message that we're going that you need to get to? Super, we're going to question. So my team will appreciate that you asked that. So one of the first things I did when I came onboard a few months back, let's say, Hey guys, we really need to sit down and think through the different personas, right? Classic marketing approach that we're talking to and really understand, um, what's in their heads, not only today but formerly and then what are they looking at going forward? Cause if you're going to cross that chasm, you need to understand that whole life cycle and what are the things that you can grab onto that draw their attention into the solutions we provide. And so we're going through an exercise right now to refresh those personas and be able to arm our field and our partners to have those conversations cause it does touch on different people in the data center. Absolutely true. >>So what, I wanted to return our conversation and come full circle with the very beginning of what is resonating with you here at this show. There've been so many new product announcements, started talking about Azure Ark as as sort of something that is catching your interest. What are you going to take back with you when the show's over? Chatting >>with some of our PM team, uh, earlier this week, um, we have our own management solution and we've done a lot to simplify it and make it easy to use. But as is the case for many providers, we are a building block in a bigger data center strategy. And, and so importantly, uh, while I love our console, a lot of people may not want to use it. We, we may not be the center of the management universe. And so something like arc and you saw this in, in what they demo now just being able to manage an Azure environment, but reaching across the aisle to AWS and so on. You know, we, we need to be able to fit into that management framework. And by the way, they're just one provider that does that. You know, the Atmos guys are out there and others. Um, and, and so the good news from a Cohesity standpoint is the products and built ground up with an API first approach. >>And what that means is, uh, you can take those declarative statements that you have in let's pretend someday as your Ark and use that to orchestrate deployment and management of Cohesity as well. And that, that is candidly one of the beauties of being a software defined solution. We thought about that from the ground up. And so I think we're not only ready for today, but also for the future. Alright. Uh, Chris, want to give you any other kind of customer aha moments or things that are brought through a final takeaways, uh, from, from Cohesity at the show? Yeah, I, I think, you know, uh, customers are still discovering us is, is an aha for me. The, the big change that I've seen in, in the booth behind us, uh, year over year as they think in the past, uh, we've only been an operations really selling for three years. >>It was who are you guys and what's up with all the green, right? This year the conversation has shifted to, Hey Cohesity, I know you guys are, I'm looking at changing things up in my software defined data center. I think you might be a part of that. So tell me why you're different. And so I'm really happy to be here and get the opportunity to have that discussion this year versus where we were last year. And again, I think, um, the types of questions that we're getting are much more focused on use case. How can you help me solve this pain point, this problem? Uh, you know, ransomware has been a constant conversation in the booth and, and the ability that we have because of what we've done, again, back down the file system to do what we call an instant mass restore. That's an interesting feature on a data sheet, but I'll tell you what, when you've been subject to a ransomware attack and you're, you're just lights out, that ability to bring back to the whole environment very quickly at once really is a differentiator for us. And so it's those sorts of conversations we're having this year, which is, which is a nice step forward. And so hopefully, you know, we'll come back next year and things are on that upward path even more. So. Thank you so much Chris. Wiborg pleasure having you on the show. Yeah, great to be here. Thanks guys. >>I'm Rebecca Knight for Sue minimun. Stay tuned for more of the cube.

(hopeful futuristic music) >> Hey welcome back everybody, Jeff Frick here with theCUBE. We are really excited to have this cube conversation here in the Palo Alto studio with a real close friend of theCUBE, and repeat alumni, Leslie Berlin. I want to get her official title; she's the historian for the Silicon Valley archive at Stanford. Last time we talked to Leslie, she had just come out with a book about Robert Noyce, and the man behind the microchip. If you haven't seen that, go check it out. But now she's got a new book, it's called "Troublemakers," which is a really appropriate title. And it's really about kind of the next phase of Silicon Valley growth, and it's hitting bookstores. I'm sure you can buy it wherever you can buy any other book, and we're excited to have you on Leslie, great to see you again. >> So good to see you Jeff. >> Absolutely, so the last book you wrote was really just about Noyce, and obviously, Intel, very specific in, you know, the silicon in Silicon Valley obviously. >> Right yeah. >> This is a much, kind of broader history with again just great characters. I mean, it's a tech history book, but it's really a character novel; I love it. >> Well thanks, yeah; I mean, I really wanted to find people. They had to meet a few criteria. They had to be interesting, they had to be important, they had to be, in my book, a little unknown; and most important, they had to be super-duper interesting. >> Jeff Frick: Yeah. >> And what I love about this generation is I look at Noyce's generation of innovators, who sort of working in the... Are getting their start in the 60s. And they really kind of set the tone for the valley in a lot of ways, but the valley at that point was still just all about chips. And then you have this new generation show up in the 70s, and they come up with the personal computer, they come up with video games. They sort of launch the venture capital industry in the way we know it now. Biotech, the internet gets started via the ARPANET, and they kind of set the tone for where we are today around the world in this modern, sort of tech infused, life that we live. >> Right, right, and it's interesting to me, because there's so many things that kind of define what Silicon Valley is. And of course, people are trying to replicate it all over the place, all over the world. But really, a lot of those kind of attributes were started by this class of entrepreneurs. Like just venture capital, the whole concept of having kind of a high risk, high return, small carve out from an institution, to put in a tech venture with basically a PowerPoint and some faith was a brand new concept back in the day. >> Leslie Berlin: Yeah, and no PowerPoint even. >> Well that's right, no PowerPoint, which is probably a good thing. >> You're right, because we're talking about the 1970s. I mean, what's so, really was very surprising to me about this book, and really important for understanding early venture capital, is that now a lot of venture capitalists are professional investors. But these venture capitalists pretty much to a man, and they were all men at that point, they were all operating guys, all of them. They worked at Fairchild, they worked at Intel, they worked at HP; and that was really part of the value that they brought to these propositions was they had money, yes, but they also had done this before. >> Jeff Frick: Right. >> And that was really, really important. >> Right, another concept that kind of comes out, and I think we've seen it time and time again is kind of this partnership of kind of the crazy super enthusiastic visionary that maybe is hard to work with and drives everybody nuts, and then always kind of has the other person, again, generally a guy in this time still a lot, who's kind of the doer. And it was really the Bushnell-Alcorn story around Atari that really brought that home where you had this guy way out front of the curve but you have to have the person behind who's actually building the vision in real material. >> Yeah, I mean I think something that's really important to understand, and this is something that I was really trying to bring out in the book, is that we usually only have room in our stories for one person in the spotlight when innovation is a team sport. And so, the kind of relationship that you're talking about with Nolan Bushnell, who started Atari, and Al Alcorn who was the first engineer there, it's a great example of that. And Nolan is exactly this very out there person, big curly hair, talkative, outgoing guy. After Atari he starts Chuck E. Cheese, which kind of tells you everything you need to know about someone who's dreaming up Chuck E. Cheese, super creative, super out there, super fun oriented. And you have working with him, Al Alcorn, who's a very straight laced for the time, by which I mean, he tried LSD but only once. (cumulative laughing) Engineer, and I think that what's important to understand is how much they needed each other, because the stories are so often only about the exuberant out front guy. To understand that those are just dreams, they are not reality without these other people. And how important, I mean, Al Alcorn told me look, "I couldn't have done this without Nolan, "kind of constantly pushing me." >> Right, right. >> And then in the Apple example, you actually see a third really important person, which to me was possibly the most exciting part of everything I discovered, which was the importance of the guy named Mike Markkula. Because in Jobs you had the visionary, and in Woz you had the engineer, but the two of them together, they had an idea, they had a great product, the Apple II, but they didn't have a company. And when Mike Markkula shows up at the garage, you know, Steve Jobs is 21 years old. >> Jeff Frick: Right. >> He has had 17 months of business experience in his life, and it's all his attack for Atari, actually. And so how that company became a business is due to Mike Markkula, this very quiet guy, very, very ambitious guy. He talked them up from a thousand stock options at Intel to 20,000 stock options at Intel when he got there, just before the IPO, which is how he could then turn around and help finance >> Jeff Frick: Right. >> The birth of Apple. And he pulled into Apple all of the chip people that he had worked with, and that is really what turned Apple into a company. So you had the visionary, you had the tech guy, you also needed a business person. >> But it's funny though because in that story of his visit to the garage he's specifically taken by the engineering elegance of the board >> Leslie Berlin: Right. >> That Woz put together, which I thought was really neat. So yeah, he's a successful business man. Yes he was bringing a lot of kind of business acumen value to the opportunity, but what struck him, and he specifically talks about what chips he used, how he planned for the power supply. Just very elegant engineering stuff that touched him, and he could recognize that they were so far ahead of the curve. And I think that's such another interesting point is that things that we so take for granted like mice, and UI, and UX. I mean the Atari example, for them to even think of actually building it that would operate with a television was just, I mean you might as well go to Venus, forget Mars, I mean that was such a crazy idea. >> Yeah, I mean I think Al ran to Walgreens or something like that and just sort of picked out the closest t.v. to figure out how he could build what turned out to be Pong, the first super successful video game. And I mean, if you look also at another story I tell is about Xerox Park; and specifically about a guy named Bob Taylor, who, I know I keep saying, "Oh this might be my favorite part." But Bob Taylor is another incredible story. This is the guy who convinced DARPA to start, it was then called ARPA, to start the ARPANET, which became the internet in a lot of ways. And then he goes on and he starts the computer sciences lab at Xerox Park. And that is the lab that Steve Jobs comes to in 1979, and for the first time sees a GUI, sees a mouse, sees Windows. And this is... The history behind that, and these people all working together, these very sophisticated Ph.D. engineers were all working together under the guidance of Bob Taylor, a Texan with a drawl and a Master's Degree in Psychology. So what it takes to lead, I think, is a really interesting question that gets raised in this book. >> So another great personality, Sandra Kurtzig. >> Yeah. >> I had to look to see if she's still alive. She's still alive. >> Leslie Berlin: Yeah. >> I'd love to get her in some time, we'll have to arrange for that next time, but her story is pretty fascinating, because she's a woman, and we still have big women issues in the tech industry, and this is years ago, but she was aggressive, she was a fantastic sales person, and she could code. And what was really interesting is she started her own software company. The whole concept of software kind of separated from hardware was completely alien. She couldn't even convince the HP guys to let her have access to a machine to write basically an NRP system that would add a ton of value to these big, expensive machines that they were selling. >> Yeah, you know what's interesting, she was able to get access to the machine. And HP, this is not a well known part of HP's history, is how important it was in helping launch little bitty companies in the valley. It was a wonderful sort of... Benefited all these small companies. But she had to go and read to them the definition of what an OEM was to make an argument that I am adding value to your machines by putting software on it. And software was such an unknown concept. A, people who heard she was selling software thought she was selling lingerie. And B, Larry Ellison tells a hilarious story of going to talk to venture capitalists about... When he's trying to start Oracle, he had co-founders, which I'm not sure everybody knows. And he and his co-founders were going to try to start Oracle, and these venture capitalists would, he said, not only throw him out of the office for such a crazy idea, but their secretaries would double check that he hadn't stolen the copy of Business Week off the table because what kind of nut job are we talking to here? >> Software. >> Yeah, where as now, I mean when you think about it, this is software valley. >> Right, right, it's software, even, world. There's so many great stories, again, "Troublemakers" just go out and get it wherever you buy a book. The whole recombinant DNA story and the birth of Genentech, A, is interesting, but I think the more kind of unique twist was the guy at Stanford, who really took it upon himself to take the commercialization of academic, generated, basic research to a whole 'nother level that had never been done. I guess it was like a sleepy little something in Manhattan they would send some paper to, but this guy took it to a whole 'nother level. >> Oh yeah, I mean before Niels showed up, Niels Reimers, he I believe that Stanford had made something like $3,000 off of the IP from its professors and students in the previous decades, and Niels said "There had to be a better way to do this." And he's the person who decided, we ought to be able to patent recombinant DNA. And one of the stories that's very, very interesting is what a cultural shift that required, whereas engineers had always thought in terms of, "How can this be practical?" For biologists this was seen as really an unpleasant thing to be doing, don't think about that we're about basic research. So in addition to having to convince all sorts of government agencies and the University of California system, which co-patented this, to make it possible, just almost on a paperwork level... >> Right. >> He had to convince the scientists themselves. And it was not a foregone conclusion, and a lot of people think that what kept the two named co-inventors of recombinant DNA, Stan Cohen and Herb Boyer, from winning the Nobel Prize is that they were seen as having benefited from the work of others, but having claimed all the credit, which is not, A, isn't fair, and B, both of those men had worried about that from the very beginning and kept saying, "We need to make sure that this includes everyone." >> Right. >> But that's not just the origins of the biotech industry in the valley, the entire landscape of how universities get their ideas to the public was transformed, and that whole story, there are these ideas that used to be in university labs, used to be locked up in the DOD, like you know, the ARPANET. And this is the time when those ideas start making their way out in a significant way. >> But it's this elegant dance, because it's basic research, and they want it to benefit all, but then you commercialize it, right? And then it's benefiting the few. But if you don't commercialize it and it doesn't get out, you really don't benefit very many. So they really had to walk this fine line to kind of serve both masters. >> Absolutely, and I mean it was even more complicated than that, because researchers didn't have to pay for it, it was... The thing that's amazing to me is that we look back at these people and say, "Oh these are trailblazers." And when I talked to them, because something that was really exciting about this book was that I got to talk to every one of the primary characters, you talk to them, and they say, "I was just putting one foot in front of the other." It's only when you sort of look behind them years later that you see, "Oh my God, they forged a completely new trail." But here it was just, "No I need to get to here, "and now I need to get to here." And that's what helped them get through. That's why I start the book with the quote from Raiders of the Lost Ark where Sallah asks Indy, you know basically, how are you going to stop, "Stop that car." And he says, "How are you going to do it Indy?" And Indy says, "I don't know "I'm making it up as I go along." And that really could almost be a theme in a lot of cases here that they knew where they needed to get to, and they just had to make it up to get there. >> Yeah, and there's a whole 'nother tranche on the Genentech story; they couldn't get all of the financing, so they actually used outsourcing, you know, so that whole kind of approach to business, which was really new and innovative. But we're running out of time, and I wanted to follow up on the last comment that you made. As a historian, you know, you are so fortunate or smart to pick your field that you can talk to the individual. So, I think you said, you've been doing interviews for five or six years for this book, it's 100 pages of notes in the back, don't miss the notes. >> But also don't think the book's too long. >> No, it's a good book, it's an easy read. But as you reflect on these individuals and these personalities, so there's obviously the stories you spent a lot of time writing about, but I'm wondering if there's some things that you see over and over again that just impress you. Is there a pattern, or is it just, as you said, just people working hard, putting one step in front of the other, and taking those risks that in hindsight are so big? >> I would say, I would point to a few things. I'd point to audacity; there really is a certain kind of adventurousness, at an almost unimaginable level, and persistence. I would also point to a third feature at that time that I think was really important, which was for a purpose that was creative. You know, I mean there was the notion, I think the metaphor of pioneering is much more what they were doing then what we would necessarily... Today we would call it disruption, and I think there's a difference there. And their vision was creative, I think of them as rebels with a cause. >> Right, right; is disruption the right... Is disruption, is that the right way that we should be thinking about it today or are just kind of backfilling the disruption after the fact that it happens do you think? >> I don't know, I mean I've given this a lot of thought, because I actually think, well, you know, the valley at this point, two-thirds of the people who are working in the tech industry in the valley were born outside of this country right now, actually 76 percent of the women. >> Jeff Frick: 76 percent? Wow. >> 76 percent of the women, I think it's age 25 to 44 working in tech were born outside of the United States. Okay, so the pioneering metaphor, that's just not the right metaphor anymore. The disruptive metaphor has a lot of the same concepts, but it has, it sounds to me more like blowing things up, and doesn't really thing so far as to, "Okay, what comes next?" >> Jeff Frick: Right, right. >> And I think we have to be sure that we continue to do that. >> Right, well because clearly, I mean, the Facebooks are the classic example where, you know, when he built that thing at Harvard, it was not to build a new platform that was going to have the power to disrupt global elections. You're trying to get dates, right? I mean, it was pretty simple. >> Right. >> Simple concept and yet, as you said, by putting one foot in front of the other as things roll out, he gets smart people, they see opportunities and take advantage of it, it becomes a much different thing, as has Google, as has Amazon. >> That's the way it goes, that's exactly... I mean, and you look back at the chip industry. These guys just didn't want to work for a boss they didn't like, and they wanted to build a transistor. And 20 years later a huge portion of the U.S. economy rests on the decisions they're making and the choices. And so I think this has been a continuous story in Silicon Valley. People start with a cool, small idea and it just grows so fast among them and around them with other people contributing, some people they wish didn't contribute, okay then what comes next? >> Jeff Frick: Right, right. >> That's what we figure out now. >> All right, audacity, creativity and persistence. Did I get it? >> And a goal. >> And a goal, and a goal. Pong, I mean was a great goal. (cumulative laughing) All right, so Leslie, thanks for taking a few minutes. Congratulations on the book; go out, get the book, you will not be disappointed. And of course, the Bob Noyce book is awesome as well, so... >> Thanks. >> Thanks for taking a few minutes and congratulations. >> Thank you so much Jeff. >> All right this is Leslie Berlin, I'm Jeff Frick, you're watching theCUBE. See you next time, thanks for watching. (electronic music)

>> Announcer: Live from San Francisco, it's theCUBE, covering Spark Summit 2017. Brought to you by Databricks. >> Welcome back to theCUBE, and we are pleased to have our first guest here today. He is a customer of Databricks, and also doing some exciting things with Spark. So welcome Nathan Murith, our senior software development manager from Autodesk. Welcome, Nathan. >> Thank you. >> Are you happy to be here? >> Absolutely, very exciting. >> Is this your first Spark Summit? >> It is, absolutely, yep. First time here, first time at a Spark Summit. Lot of fun, lot of people, lot of energy. So I'm very happy to be here. >> Well, before we dive into some of the exciting things you're doing with Spark, maybe tell me what you were hoping to learn at this summit. >> I think, I'm really interested in learning what's coming next. You know, Autodesk is a technology company. We build products, we build software, and we're always looking at the future, figuring out what we can build and what we can leverage this amazing technology for, in our own tools that we then offer to our customers. >> And did you just attend the Keynote? >> Nathan: I did. >> And what did you think? What stood out to you? >> A lot of interesting things that I want to go home and try, basically, or take back to the office and try, 'cause a lot of these things are very applicable to what we're doing on a day to day basis. >> All right, we've also got George Gilbert on the show. And George, we're going to dig in a little bit. Maybe you have a question for Nathan about what he's doing with ... >> Yeah, Nathan, for those of us who are antediluvian, in other words, having been born before the big flood that floated Noah's Ark, what was, tell us about the types of that Autodesk builds, and how Spark helps people who use those tools. >> Sure, so Autodesk, as a company, we do a lot of different things. Autodesk primarily builds software for the design and make space in three or four different verticals and disciplines. One is media and entertainment. One is manufacturing. One is architecture, engineering, and construction. The group that I'm a part of, and the software that our team is responsible for building, is mainly around the cloud and mobile products for the architecture, engineering, and construction industry. Specifically, we have a suite of products that we brand BIM 360, that basically are tailored to the construction industry and various personas, and various steps, depending on where you are in the life cycle. The building a vertical structure, a bridge, a hospital, a stadium, and we provide software for those individuals. >> Can you tell us a little bit about that life cycle, and then the life cycle of a project like that, and where Spark can help a customer who's thinking 360, and not a particular product. >> Absolutely. So the life cycle is pretty complex, but it starts, usually, on the computer, like this, where you'll design your building, or your structure, or whatever it is. Heavy 3D graphics, that's where Autodesk, the company, started. From that point on, you do a number of coordination exercises with the various disciplines in a construction project, so your architecture, your structural, your plumbing, your heat/ventilation/air conditioning people, that are all specific disciplines. Then you actually go on site, and you start building this structure, whatever it may be. And when you build, the building process that typically could take multiple months to multiple years, depending on how large the structure is, is when people are going to start leveraging some of our tools even more. Typically some of the things that we see a lot of is, when you're managing a construction site, you will see on a daily basis hundreds, probably, if not thousands of construction issues. This sheet of glass here is broken. The drywall, you know, fell off. This beam is going through a wall, you name it. Construction site problems happen every day. >> You want to know if the beam's going through the wall. >> Exactly, absolutely. So typically that generates a lot of data, to the point where our customers can possibly feel overwhelmed by their own data, because there just is so many things that get generated in our system. >> So this actually sounds like where IT operations is the the discipline of I've got all this infrastructure, and I'm getting all these alerts when little things go wrong, and I don't know where the, necessarily, the root cause is, or what I should attack first. Is that sort of what you're... >> It's where we're going. Yeah, absolutely. Right now, we're tackling, we're starting, we're still early stages with kind of the machine learning, data science applications to the products that we do and build. But right now, what we're tackling, we're just trying to help our customers gain insights on their own data, so when you're swimming in this vast ocean of data, and you don't know where to start, or typically a construction site the size of a stadium, or a campus, or a huge office building, you don't know where to start, typically. >> So what does this vast pool of data look like, and how, specifically, are you using Spark to help make sense out of it, or prioritize what you should look at? >> So a lot of what we're doing now is, we're using image data, and text data, so what happens is your superintendents, when they walk around a construction site to figure out what's going on, what's broken, what's working, what should I focus on today? They will walk around with our mobile devices, or their mobile devices using our mobile software, and take pictures, and write descriptions of things that they see walking around the construction site. So they've generated hundreds of thousands of these construction issues, and where we're leveraging Spark, is to help build classification models on top of that data, be it image and textual data, to help bring to the surface, and bring to the top the things that are most critical to our customers. Typically, one example is on a construction site any problem that's related to water is usually considered a big problem. So if we can help among hundreds of thousands of issues that happen on construction site, kind of identify what. Hey, Mister Superintendent, you have these 10 problems that are related to water, whatever they may be, you should probably focus on those first. And that's where we're leveraging things like, you know, Spark technologies, machine learning, data science to build our products. >> And are you are you learning from all the customers who use the product, or in other words, do you need their data to get smarter, or is it rules that you're building? >> So right now we're working with a subset of our customers, through which we've gone into a number of agreements where they were okay with us working with them very closely to possibly use some of their data that was generated in our tools and systems to help them to help build our model. So we're absolutely not looking at the entire data set, per se. >> Did you see anything in the keynote, with the Structured Streaming that's now down to a millisecond, which is truly impressive for Spark, or in the deep learning that might simplify traditional machine learning. Did you see anything there that looks like it might have an impact on the type of app you could build? >> Very much so. So I think all the streaming applications are very relevant, because more and more on the construction sites, or more and more construction sites are being censored with, whether it's webcams, cameras, temperature detection, dust detection, air quality detection. >> George: IoT. >> Exactly, IoT all over the place, so when we can start collecting the data from those devices, streaming into our systems, we can more proactively notify, warn our customers, people on site, either security risk, any dangerous situation, or simply this is happening right now on your construction site, you might have to wake up because it's the middle of the night, and go check out what's going on. >> This is actually of great interest to us, because one of our themes now, where customers are telling us that they're trying to figure out what type of analytics, especially the machine learning training, would happen in the cloud, and what type of analytics would happen on site, or on customer premise. Are you doing the training up in the Autodesk cloud, and then, are you doing would the models be evaluating and executing sort of on site, close to where the data is being captured? >> So right now, again, early stages. So a lot of those questions we're still trying to figure out and understand what's best, what's best for our customers, what's, obviously the most secure, and things like that. A lot of the training that we're doing today is in the Autodesk cloud, so we use a lot of our cloud infrastructure where the data resides for our products, of course, to build and train our models, essentially. >> Well, we only have a couple of minutes left, but I wanted to dig in to, maybe some of the lessons learned. You said it was early days. So what are some things you could share with the community here on theCUBE that would help them? So maybe just getting started with Spark and some of the valuable lessons you've learned you'd want to share. >> I would say, I would say probably, get started now, is probably my piece of advice. I think we're all going in this direction, a lot of technology, and it's interesting 'cause even the construction space that I'm in is maybe not considered the highest tech, you know, discipline, which your industry, which makes sense and is obvious, but even in the construction space, we're going in the direction of using machine learning, data science, Spark-like technology. So I would say, get started now. That would be my piece of advice, 'cause there's a lot to learn, and things move really fast. >> Okay, so if you could complete this sentence: Spark has finally enabled Autodesk to blank. And start with Spark. I'm trying to get a sound bite out of you. >> Yeah, I think so. Spark has finally allowed Autodesk to build valuable customer-facing machine learning and data science products for our customers. >> And then the business outcomes for that, are being closely watched by executive sponsors, or how does that work? >> They are, but again, early days, right? Any large corporation like Autodesk, early days is a lot of moving parts so we're still feeling the waters of it now. >> Right, George, the last question goes to you. >> I guess, from what you've seen today, and anything you've heard about also coming down the roadmap, how might you expand the application that you are building in terms of thinking new possibilities, pushing the boundary? >> I think Internet of things is something that we're looking at, and I can very well foresee being part of this solution and ecosystem, as well as just allowing, I think, allowing our customers to push and pull their data into our systems to leverage our technologies, or to pull it back out, to plug it into their BI tools, or things like that. And I think that's something that, at least for our enterprise customers, will be very valuable. >> All right. Well, Nathan Murith from Autodesk, thank you so much for spending some time >> Absolutely, thank you. >> here on theCUBE. We're going to let you get back to the show. It looks like the show floor is open now, so get out and network with some of those 3,000 attendees. >> Perfect, thank you very much. >> All right, thank you so much. And thank you for watching. We'll be back soon with more guests, here on theCUBE. (techno music)

>> Presenter: Live from the Wynn Resort in Las Vegas, it's theCUBE, covering .NEXT Conference 2016. Brought to you by Nutanix. Now here are your hosts, Dave Vellante and Stu Miniman. >> Welcome back to Las Vegas everybody. Mark Templeton is here, industry legend, former CEO of Citrix. Mark, really a pleasure having you on. >> Thanks, thanks, really great to be here. >> So what are you doing these days? (laughter) >> Enjoying retirement, right, way more than I thought. But earlier today at the Nutanix NEXT Conference, Mark Leslie, the legend, icon, talked about the Ark of Life. And he had this one slide that said, "There is no finish line." And I think anyone who is blessed to have worked their career around their passion, he just captured it all in that one slide. And so there's no finish line, it's just sort of continuing the journey with maybe some new friends and colleagues. >> Right, no hammock, no umbrella drinks. >> Oh plenty of drinks-- >> But it doesn't end there. >> No, plenty of drinks as always but no hammock. >> So we heard your keynote yesterday, which is outstanding. You're spending a lot of time thinking about the future. >> Yes. >> So you've got time to do that now, what are you seeing? What's in the binoculars of Mark Templeton. >> Well, a big thing for me is people and how generations of people actually influence changes in our environment and how they drive different ages in the sense of descriptions of time. So I think for me, I was born analog, I'm a boomer, and boomers generally, born analog, but I fell in love with digital and made it my career. My children are XY geners. They were born digital mainly because of my career, but many in their generation we're actually born analog but learned digital pretty quickly. Now Millennials, they're born digital and they're not interested in how things work from a computing perspective. They want to know what can it do. And so the question is now what's next? And as I sort of talked to a lot of Millennials, talked to a lot of companies that are out there with ideas, I've concluded that we're actually at the end of the digital age because we're on digital overload. There are too many devices, there are too many apps, too much data, too many social connections. I mean, no one can handle and manage it all and the only way we can keep going in terms of leveraging technology to the benefit of humankind is for it to become invisible. And the way it becomes invisible is to take what we've accepted as analog for a long, long time, human emotion, relationships, location of people, intersections amongst people, et cetera, and start creating context out of that through digital mechanisms. So I think this next, where things are going, is away from digital, toward contextual. And it's through contextual that we can actually have a greater experience with technology underneath. And yeah, tremendous opportunities for invention, innovation, et cetera. You asked the question yesterday to the audience, who can program an assembler. I put my hand up. I don't know if I still could, but I certainly have. But your point was that everybody who's programming today is programming an assembler, it's just invisible. >> It's invisible, that's right. Every layer of extraction makes the layers below invisible. And that's one of the things I love about Nutanix because they're making cloud infrastructure, hypervisors, kind of all this componentry, invisible, allowing the focus on a common set of services that are exposed. And for a whole set of people, that's great, right? And that means you can move on to the higher layers of the stack. Same thing goes for contextuality. Contextuality will create layers of abstraction that when you enter the room, the right things happen. You don't have to think about oh, I'm using Lutron switches or I've got a nest going on here, did it move from away to home? All of that, it becomes invisible and goes away. It's just early in the cycle of getting there. >> Yeah, so what do you see that having an impact on the jobs that people are having? You talked about moving up the stack. Even in IT here and for Nutanix, it's oh wow, this is what my job's been for years and now I don't need to do that, I'm retraining, moving up the stack, those challenges. >> Well, I think history shows that every generation where there's a layer of abstraction that has lots of staying power, what it does is it takes a bunch of people and it says okay, you stay below that stack if you're a specialist and you stay deep on it. I mean, let's face it, you put Nutanix technology in place, you have to have deep specialists under that. It's just that the DevOps people don't have to know anything about how it works underneath. The business units don't have to know anything about that, and so they can take all of that stuff that's cluttering their time and mind and focus on the missions that are important to them. So it creates layers of specialization along the way, and then it pushes generalists up, up, up. And look, I mean I think the Nutanix team I think adequately talked about the notion of what do we do when we get time back, whether we're admins or whether we're CIOs or whether we're CEOs or whether we're just individuals? And I think that's where humankind seems to not have a problem in consuming that extra time, whether it's recreational or maybe more return to some of the basic values of families and relationships, or new levels of innovation and invention. I think there are a lot of things that get done with that extra time. >> If I infer from your talk yesterday, you don't like the term consumerization of IT. You used a different term. >> Yeah, I actually... Jeff with Slack made that point around consumerization of IT, and he said really, it's about humanization of IT. I think these terms serve purposes along the way, and I think that we're still in the process of consumerizing IT. It's just that the purpose of the consumerization is to humanize it. And the consumerization basically is making things, making the IT experience much more retail, right? Where people get choice, where they get self service, and IT organizations actually describe themselves in a way where they're merchandising services that benefit the business. So I don't dislike consumerization as much as I really like the idea of moving the idea forward to humanization, because that's the outcome you're looking for. >> So square or circle for me because you said something that surprised me, the end of the digital age, right? And you defended that position, but I want to ask you about something like autonomous vehicles. I was talking to my teenage daughters the other day, and one of them made the point that turning 16 is a symbol of freedom. And one of the pieces of that freedom is you get to drive a car. And so I thought you were going to say this is just the beginning of the digital age. What do you make of that in terms of the impact on society and its humanization aspect? >> Well, so the end of the digital age includes it's the end of the visibility of digital, because it's just peaked out. And so digital and technologies around digital, you're just becoming more and more and more invisible as machines do more work that humans used to do. I mean, here's a question. Why is it so hard for older people to adopt new technologies? If they're so simple and they're so great, why do they have a hard time adopting? >> Dave: Because they're complicated. >> They're complicated, right? When you're doing it over and over, you don't realize how much knowledge you're applying to something that's so simple, all right? So all I'm saying is that the test will be when a generation that's behind us can actually consume it in pretty ubiquitous ways. And so it's the boomerang kind of effect, all right? >> So Stu, you were talking a little bit about the work that we did with the guys at MIT and Brynjolfsson and McAfee of The Second Machine Age. So do you think much about, I'm sure you do, about the impact of machines? Machines have always replaced humans. They seem to be now doing it at a cognitive level. What are your thoughts and the state of education in this country in particular? >> Well, I mean there are two ways to answer that, half-full, half-empty. I'm an optimist, and I think that these kinds of things I'm talking about actually will serve to make education more personalized by individual. When I look at the things like Khan Academy, right, and the impact the Khan Academy has made in public school systems, and you squint at it so that you only see the shapes and forms, here's what it's done. It's allowed the teachers to focus on the students by exception and where they need help as opposed to mass kind of education, an entire classroom. That's been one of the big effects of Sal Kahn's work. So I'm optimistic about machines, contextuality, and the intersection of all of that when it comes to education. Because I think the more context a teacher has around a student, what's going on at home, what's happening in other classes, extracurricular activities or lack thereof gives them a better ability to actually teach them, and gives them a better ability to learn if the systems are set up to make that connection. >> And we're optimists too. I mean, I think the observation is that the industry has marched to the cadence of Moore's Law for decades, and that's what's driven innovation. And it's not driving innovation anymore, it's the combination of technologies. We think that creativity, teaching, I don't know if you could teach creativity, I guess you can-- >> Yes you can. >> Why can't you, right? That seems to be the new frontier of education, in our view anyways. That make sense to you? >> It makes total sense. By the way, you travel the world and you characterize various educational methodologies and priorities around the world. I mean, a lot of people throw rocks at the educational system in the U.S. It's actually a system that promotes creativity more than any other educational system in the world, okay? You go to certain countries in Asia and they promote knowledge and knowing facts and being able to state facts and correlate fact, all right? And there's nothing fundamentally wrong with that, it's just that you're not driving a creative sort of process, you aren't teaching creativity. So yes, I'm optimistic about where we're headed in the sense of how this age of contextuality can actually propel us forward as a nation around education. >> And that's, Stu, why I hear so much criticism about teaching the test. You got little young kids and you hear a lot of that backlash. >> Yeah, yeah absolutely. Mark, I want to go back. You talked a lot about kind of generations and journeys. When we look in the IT space, the pace of change is just faster than ever. What advice do you give to, how do you get, by now, by the time you're relevant, you're almost irrelevant soon after. So how do you plan for that? >> So first of all, I think you always have to start with an opinion about the future that you believe in so strongly that you're willing to make bets, okay? And some of the bets, there are low-risk bets, there are high-risk bets. Mark Leslie talked about transformation, et cetera, today, and that's really about having an opinion about the future and making a bet. And he gave some great case studies. But if you look at those case studies, you ask the CEOs, the leaders there, they didn't think they were high risk because they thought the greater risk was not betting, right? And it's because of their opinion of the future. So I think you have to start there. Too many, my observation, opinion, is too many people read too many books, too much of the net and form their opinions based upon what they read as opposed to forming an opinion on their own through some amount of introspection and experience, okay? And I think that, I'll give you an example. I remember, it was probably 1999. I was newly CEO of Citrix and I had a whole faction of our dev team saying, Mark it's all about WAP. (host chuckles) I was like, what do you mean it's all about WAP? It's like, it's all about WAP. I said, what's WAP? Well, it's the wireless, I can't remember what it stood for, something protocol. Access protocol. (crosstalk) So okay, I said fine, all right. Let's meet on that like next week. Okay, fine. So over the weekend, I go somewhere and I bought a WAP phone, a Nokia WAP phone that supported WAP. So I get on there over the weekend and blah, blah, blah, blah, blah, fine. I go to the meeting next week, sit down, and the whole team comes, it's all about WAP, here's why. I said okay, let me start with a question. Can everyone showed me their WAP phones? No one had one. And I pulled mine out and I said hey, let me give you a demo. So yeah, you form an opinion about something and then you can, and so I said we're not spending one nickel on WAP, right? Right. So I think that's the number one advice I would give. Because then when you have a belief and an opinion about the future, you feel they're low risk for the right reasons. >> I want to ask you as a CEO, a former CEO of a public company, you heard Mark Leslie talk about, today, the short-term focus. A lot of people talk about that. Ever since I've been in the business, people talk about, particularly US companies, short-term focus, Wall Street, now you're seeing activist investors. Maybe it's gone to a new level. I presume you agree, but it's worked. United States is dominant, and they've always had the short-term focus. Have we gone beyond a point though of rationality? >> Well, I think this is a semantical problem. So I think I probably don't agree with Mark, all right? And along the way, when people said public CEO, go with the PE guys, do that. Well, why would I do that? Well, because you don't have the short-term focus like the quarterly thing. I was like, are you kidding me? (host chuckles) You don't know PE guys, first of all. Secondly, I disagree because you're measured as a public company against the expectations that you set. So if you set the wrong expectations and miss them, then you're in trouble. If you set the right expectations, whether those expectations are financial, strategic, operational, and you exceed them, there's no problem with it. And our system is successful because there's a quarterly rhythm to measuring the path of companies that are public. And so there's no law out there that says every time you measure, it has to be something prescribed. It is prescribed, it's prescribed by the CEO and board-- >> Dave: And the expectations that get set. >> And the expectations that get set. So I was CEO of Citrix for many, many years. And when I retired, it was my 70th earnings report, all right? And I figured, I figured 70 years in jail is enough. I applied for parole a few times and it was denied. But seriously, the idea of a quarterly report against the expectations you set is not a bad thing. >> Yeah, Michael Dell talks about the 90-day shot clock, but I bet you he has a 90-day shot clock internally. >> Sure. I mean, absolutely. >> I don't know if this is the case, but it seems to me that some of the companies that I observed today, that are successful, in particular, Nutanix, I would put service now in that category, Tableau, Splunk, they seem to be highly transparent, maybe more transparent than I'm used to. Maybe I just wasn't paying attention before. Have you observed that? Do you think it's just a function of their success and their size, allows them to be more transparent than-- >> I think that... I think that's a big change that's taken place. So more newly public companies like Splunk, for example, have to be more transparent around the core metrics they use to measure success. So if you look at some of the, like Adobe, hugely successful transformation story. They did it through obviously the right strategic mechanisms to move to a different business model, but they had to create a level of transparency to get there in order to successfully make that transformation. Companies like Splunk started there, all right? And so that is the standard for a more of a subscription cloud-based SAS-oriented type business model. And investors reward that, I think. And so therefore, it's confirms, it's like positive strokes to transparency, which I'm all for. >> I wish we had more time to talk about things like culture. There's so many different different topics, but we'll leave it at what's next for you, what are you spending your time on, any fun projects that you're working on? >> Yeah, I'm spending all my time on technologies that increase contextuality. So for example, one of them is a web psychographics company. So when you surf the web now, their web analytics really does more demographical kinds of things, right? But the science of psychographics actually takes a lot of that and actually figures out what's the why, your behavior, what's in your head. So I think that's a context that's important to add, again, to make the technology more invisible. Spending time on autonomic security, security that actually not only dynamically sees attacks and discontinuities, it fixes them and then tells you later, okay? Spending time on something really exciting called human location analytics, which basically is technology that can passively track human motion, and very precisely, so that as people occupy various spaces and have paths and interactions, systems around it can respond. So like in a retail environment, maybe if you're spending a lot of time at an N cap, somebody will come and help you. And if you combine some of these things, the psychographics and the human location, you'll get the right kind of help and so forth. And that all becomes invisible and we just have a great experience. >> Combining innovations, right, taking advantage of this invisible digital matrix. >> Yeah. And the thing that I'm really psyched about, and most people that have known me for some time know that I have a particular weakness for things that have round rubber tires, okay? So deeply involved in a company, an e-bike company that is called Vintage Electric Bikes. It's an e-bike you love and you want to ride because of the joy that it gives you, all right? So yeah, so things that... Greater context, so technology can be invisible, and things that bring out emotional kinds of pleasure and joy. That's where I'm spending my time. By the way, it's fun, which is the first bar I have. Number two, great people, the second bar, all right? And then the third bar is I think they actually, these things are important for a better world and creating opportunity for people, et cetera. And I like doing that. >> Well, thanks for coming on theCUBE and delighting our audiences. It was really a pleasure having you. You look great, you sound great, congratulations. >> Mark: Thanks, thanks. Having a great time, thank you very much-- >> You're welcome. All right, keep it right there everybody. Stu and I will be back with our next guest. This is SiliconANGLE's theCUBE. We'll be right back. (upbeat electronic music)