(upbeat music) >> Hello, everyone; I'm John Furrier with SiliconANGLE NEWS and host of theCUBE, and welcome to our SiliconANGLE NEWS MWC NEWS UPDATE in Barcelona where MWC is the premier event for the cloud telecommunication industry, and in the news here is Red Hat, Red Hat announcing a collaboration with NVIDIA, Samsung and Arm on Efficient Open Networks. Red Hat announced updates across various fields including advanced 5G telecommunications cloud, industrial edge, artificial intelligence, and radio access networks, RAN, and Efficiency. Red Hat's enterprise Kubernetes platform, OpenShift, has added support for NVIDIA's converged accelerators and aerial SDK facilitating RAND deployments on industry standard service across hybrid and multicloud platforms. This composable infrastructure enables telecom firms to support heavier compute demands for edge computing, AI, private 5G, and more, and just also helps network operators adopt open architectures, allowing them to choose non-proprietary components from multiple suppliers. In addition to the NVIDIA collaboration, Red Hat is working with Samsung to offer a new vRAN solution for service providers to better manage their open RAN networks. They're also working with UK chip designer, Arm, to create new networking solutions for energy efficient Red Hat Open Source Kubernetes-based Efficient Power Level Exporter project, or Kepler, has been donated to the open Cloud Native Compute Foundation, allowing enterprise to better understand their cloud native workloads and power consumptions. Kepler can also help in the development of sustainable software by creating less power hungry applications. Again, Red Hat continuing to provide OpenSource, OpenRAN, and contributing an open source project to the CNCF, continuing to create innovation for developers, and, of course, Red Hat knows what, a lot about operating systems and the telco could be the next frontier. That's SiliconANGLE NEWS. I'm John Furrier; thanks for watching. (monotone music)

(upbeat music) >> Hello, everyone and welcome back to fabulous Las Vegas, Nevada, where we are here on the show floor at AWS re:Invent. We are theCUBE. I am Savannah Peterson, joined with John Furrier. John, afternoon, day two, we are in full swing. >> Yes. >> What's got you most excited? >> Just got lunch, got the food kicking in. No, we don't get coffee. (Savannah laughing) >> Way to bring the hype there, John. >> No, there's so many people here just in Amazon. We're back to 2019 levels of crowd. The interest levels are high. Next gen, cloud security, big part of the keynote. This next segment, I am super excited about. CUBE Alumni, going back to 2013, 10 years ago he was on theCUBE. Now, 10 years later we're at re:Invent, looking forward to this guest and it's about security, great topic. >> I don't want to delay us anymore, please welcome Mark. Mark, thank you so much for being here with us. Massive day for you and the team. I know you oversee three different units at Amazon, Inspector, Detective, and the most recently announced, Security Lake. Tell us about Amazon Security Lake. >> Well, thanks Savannah. Thanks John for having me. Well, Security Lake has been in the works for a little bit of time and it got announced today at the keynote as you heard from Adam. We're super excited because there's a couple components that are really unique and valuable to our customers within Security Lake. First and foremost, the foundation of Security Lake is an open source project we call OCFS, Open Cybersecurity Framework Schema. And what that allows is us to work with the vendor community at large in the security space and develop a language where we can all communicate around security data. And that's the language that we put into Security Data Lake. We have 60 vendors participating in developing that language and partnering within Security Lake. But it's a communal lake where customers can bring all of their security data in one place, whether it's generated in AWS, they're on-prem, or SaaS offerings or other clouds, all in one location in a language that allows analytics to take advantage of that analytics and give better outcomes for our customers. >> So Adams Selipsky big keynote, he spent all the bulk of his time on data and security. Obviously they go well together, we've talked about this in the past on theCUBE. Data is part of security, but this security's a little bit different in the sense that the global footprint of AWS makes it uniquely positioned to manage some security threats, EKS protection, a very interesting announcement, runtime layer, but looking inside and outside the containers, probably gives extra telemetry on some of those supply chains vulnerabilities. This is actually a very nuanced point. You got Guard Duty kind of taking its role. What does it mean for customers 'cause there's a lot of things in this announcement that he didn't have time to go into detail. Unpack all the specifics around what the security announcement means for customers. >> Yeah, so we announced four items in Adam's keynote today within my team. So I'll start with Guard Duty for EKS runtime. It's complimenting our existing capabilities for EKS support. So today Inspector does vulnerability assessment on EKS or container images in general. Guard Duty does detections of EKS workloads based on log data. Detective does investigation and analysis based on that log data as well. With the announcement today, we go inside the container workloads. We have more telemetry, more fine grain telemetry and ultimately we can provide better detections for our customers to analyze risks within their container workload. So we're super excited about that one. Additionally, we announced Inspector for Lambda. So Inspector, we released last year at re:Invent and we focused mostly on EKS container workloads and EC2 workloads. Single click automatically assess your environment, start generating assessments around vulnerabilities. We've added Lambda to that capability for our customers. The third announcement we made was Macy sampling. So Macy has been around for a while in delivering a lot of value for customers providing information around their sensitive data within S3 buckets. What we found is many customers want to go and characterize all of the data in their buckets, but some just want to know is there any sensitive data in my bucket? And the sampling feature allows the customer to find out their sensitive data in the bucket, but we don't have to go through and do all of the analysis to tell you exactly what's in there. >> Unstructured and structured data. Any data? >> Correct, yeah. >> And the fourth? >> The fourth, Security Data Lake? (John and Savannah laughing) Yes. >> Okay, ocean theme. data lake. >> Very complimentary to all of our services, but the unique value in the data lake is that we put the information in the customer's control. It's in their S3 bucket, they get to decide who gets access to it. We've heard from customers over the years that really have two options around gathering large scale data for security analysis. One is we roll our own and we're security engineers, we're not data engineers. It's really hard for them to build these distributed systems at scale. The second one is we can pick a vendor or a partner, but we're locked in and it's in their schemer and their format and we're there for a long period of time. With Security Data Lake, they get the best of both worlds. We run the infrastructure at scale for them, put the data in their control and they get to decide what use case, what partner, what tool gives them the most value on top of their data. >> Is that always a good thing to give the customers too much control? 'Cause you know the old expression, you give 'em a knife they play with and they they can cut themselves, I mean. But no, seriously, 'cause what's the provisions around that? Because control was big part of the governance, how do you manage the security? How does the customer worry about, if I have too much control, someone makes a mistake? >> Well, what we finding out today is that many customers have realized that some of their data has been replicated seven times, 10 times, not necessarily maliciously, but because they have multiple vendors that utilize that data to give them different use cases and outcomes. It becomes costly and unwieldy to figure out where all that data is. So by centralizing it, the control is really around who has access to the data. Now, ultimately customers want to make those decisions and we've made it simple to aggregate this data in a single place. They can develop a home region if they want, where all the data flows into one region, they can distribute it globally. >> They're in charge. >> They're in charge. But the controls are mostly in the hands of the data governance person in the company, not the security analyst. >> So I'm really curious, you mentioned there's 60 AWS partner companies that have collaborated on the Security lake. Can you tell us a little bit about the process? How long does it take? Are people self-selecting to contribute to these projects? Are you cherry picking? What does that look like? >> It's a great question. There's three levels of collaboration. One is around the open source project that we announced at Black Hat early in this year called OCSF. And that collaboration is we've asked the vendor community to work with us to build a schema that is universally acceptable to security practitioners, not vendor specific and we've asked. >> Savannah: I'm sorry to interrupt you, but is this a first of its kind? >> There's multiple schemes out there developed by multiple parties. They've been around for multiple years, but they've been built by a single vendor. >> Yeah, that's what I'm drill in on a little bit. It sounds like the first we had this level of collaboration. >> There's been collaborations around them, but in a handful of companies. We've really gone to a broad set of collaborators to really get it right. And they're focused around areas of expertise that they have knowledge in. So the EDR vendors, they're focused around the scheme around EDR. The firewall vendors are focused around that area. Certainly the cloud vendors are in their scope. So that's level one of collaboration and that gets us the level playing field and the language in which we'll communicate. >> Savannah: Which is so important. >> Super foundational. Then the second area is around producers and subscribers. So many companies generate valuable security data from the tools that they run. And we call those producers the publishers and they publish the data into Security Lake within that OCSF format. Some of them are in the form of findings, many of them in the form of raw telemetry. Then the second one is in the subscriber side and those are usually analytic vendors, SIM vendors, XDR vendors that take advantage of the logs in one place and generate analytic driven outcomes on top of that, use cases, if you will, that highlight security risks or issues for customers. >> Savannah: Yeah, cool. >> What's the big customer focus when you start looking at Security Lakes? How do you see that planning out? You said there's a collaboration, love the open source vibe on that piece, what data goes in there? What's sharing? 'Cause a big part of the keynote I heard today was, I heard clean rooms, I've cut my antenna up. I'd love to hear that. That means there's an implied sharing aspect. The security industry's been sharing data for a while. What kind of data's in that lake? Give us an example, take us through. >> Well, this a number of sources within AWS, as customers run their workloads in AWS. We've identified somewhere around 25 sources that will be natively single click into Amazon Security Lake. We were announcing nine of them. They're traditional network logs, BBC flow, cloud trail logs, firewall logs, findings that are generated across AWS, EKS audit logs, RDS data logs. So anything that customers run workloads on will be available in data lake. But that's not limited to AWS. Customers run their environments hybridly, they have SaaS applications, they use other clouds in some instances. So it's open to bring all that data in. Customers can vector it all into this one single location if they decide, we make it pretty simple for them to do that. Again, in the same format where outcomes can be generated quickly and easily. >> Can you use the data lake off on premise or it has to be in an S3 in Amazon Cloud? >> Today it's in S3 in Amazon. If we hear customers looking to do something different, as you guys know, we tend to focus on our customers and what they want us to do, but they've been pretty happy about what we've decided to do in this first iteration. >> So we got a story about Silicon Angle. Obviously the ingestion is a big part of it. The reporters are jumping in, but the 53rd party sources is a pretty big number. Is that coming from the OCSF or is that just in general? Who's involved? >> Yeah, OCSF is the big part of that and we have a list of probably 50 more that want to join in part of this. >> The other big names are there, Cisco, CrowdStrike, Peloton Networks, all the big dogs are in there. >> All big partners of AWS, anyway, so it was an easy conversation and in most cases when we started having the conversation, they were like, "Wow, this has really been needed for a long time." And given our breadth of partners and where we sit from our customers perspective in the center of their cloud journey that they've looked at us and said, "You guys, we applaud you for driving this." >> So Mark, take us through the conversations you're having with the customers at re:Inforce. We saw a lot of meetings happening. It was great to be back face to face. You guys have been doing a lot of customer conversation, security Data Lake came out of that. What was the driving force behind it? What were some of the key concerns? What were the challenges and what's now the opportunity that's different? >> We heard from our customers in general. One, it's too hard for us to get all the data we need in a single place, whether through AWS, the industry in general, it's just too hard. We don't have those resources to data wrangle that data. We don't know how to pick schema. There's multiple ones out there. Tell us how we would do that. So these three challenges came out front and center for every customer. And mostly what they said is our resources are limited and we want to focus those resources on security outcomes and we have security engines. We don't want to focus them on data wrangling and large scale distributed systems. Can you help us solve that problem? And it came out loud and clear from almost every customer conversation we had. And that's where we took the challenge. We said, "Okay, let's build this data layer." And then on top of that we have services like Detective and Guard Duty, we'll take advantage of it as well. But we also have a myriad of ISV third parties that will also sit on top of that data and render out. >> What's interesting, I want to get your reaction. I know we don't have much time left, but I want to get your thoughts. When I see Security Data Lake, which is awesome by the way, love the focus, love how you guys put that together. It makes me realize the big thing in re:Invent this year is this idea of specialized solutions. You got instances for this and that, use cases that require certain kind of performance. You got the data pillars that Adam laid out. Are we going to start seeing more specialized data lakes? I mean, we have a video data lake. Is there going to be a FinTech data lake? Is there going to be, I mean, you got the Great Lakes kind of going on here, what is going on with these lakes? I mean, is that a trend that Amazon sees or customers are aligning to? >> Yeah, we have a couple lakes already. We have a healthcare lake and a financial lake and now we have a security lake. Foundationally we have Lake Formation, which is the tool that anyone can build a lake. And most of our lakes run on top of Lake Foundation, but specialize. And the specialization is in the data aggregation, normalization, enridgement, that is unique for those use cases. And I think you'll see more and more. >> John: So that's a feature, not a bug. >> It's a feature, it's a big feature. The customers have ask for it. >> So they want roll their own specialized, purpose-built data thing, lake? They can do it. >> And customer don't want to combine healthcare information with security information. They have different use cases and segmentation of the information that they care about. So I think you'll see more. Now, I also think that you'll see where there are adjacencies that those lakes will expand into other use cases in some cases too. >> And that's where the right tools comes in, as he was talking about this ETL zero, ETL feature. >> It be like an 80, 20 rule. So if 80% of the data is shared for different use cases, you can see how those lakes would expand to fulfill multiple use cases. >> All right, you think he's ready for the challenge? Look, we were on the same page. >> Okay, we have a new challenge, go ahead. >> So think of it as an Instagram Reel, sort of your hot take, your thought leadership moment, the clip we're going to come back to and reference your brilliance 10 years down the road. I mean, you've been a CUBE veteran, now CUBE alumni for almost 10 years, in just a few weeks it'll be that. What do you think is, and I suspect, I think I might know your answer to this, so feel free to be robust in this. But what do you think is the biggest story, key takeaway from the show this year? >> We're democratizing security data within Security Data Lake for sure. >> Well said, you are our shortest answer so far on theCUBE and I absolutely love and respect that. Mark, it has been a pleasure chatting with you and congratulations, again, on the huge announcement. This is such an exciting day for you all. >> Thank you Savannah, thank you John, pleasure to be here. >> John: Thank you, great to have you. >> We look forward to 10 more years of having you. >> Well, maybe we don't have to wait 10 years. (laughs) >> Well, more years, in another time. >> I have a feeling it'll be a lot of security content this year. >> Yeah, pretty hot theme >> Very hot theme. >> Pretty odd theme for us. >> Of course, re:Inforce will be there this year again, coming up 2023. >> All the res. >> Yep, all the res. >> Love that. >> We look forward to see you there. >> All right, thanks, Mark. >> Speaking of res, you're the reason we are here. Thank you all for tuning in to today's live coverage from AWS re:Invent. We are in Las Vegas, Nevada with John Furrier. My name is Savannah Peterson. We are theCUBE and we are the leading source for high tech coverage. (upbeat music)

(upbeat music) >> Okay, Chloe, thank you very much. Hey folks, in here in the Cloud City We with Danielle Royston. Great to see you. Watching you up on stage, I got to say, as the CEO of TelcoDR, leader and chief executive of that company. As well as a great visionary, you laid out the vision. It's hard to debate that. I mean, I think there's people who will say that vision, is like freedom, no one can debate it. It's not going to happen. >> Yeah, there's still a lot of debate in our industry about it. There's a lot of articles being written about it. I've referenced one about, you know, should we let the dragons into the castle? For me, I think it's super obvious. I think other industries are like "Duh, we've made the move." And Telco is still like, "Hmm, we're not sure." And so, am I a visionary, I don't know. I'm just sort of just Babe Ruth-ing it a little bit. I think that's where we're going. >> You know you do, you have a lot of content, podcasts, you write blogs, you do a lot of speaking. You brought it all together on stage, right? That has got to feel good. >> Yeah. >> You've got a body of work and it came together very nicely. How did you feel up there? >> Oh my God, it's absolutely nerve wrecking. I sort of feel like, you know, could you tell if my hands were shaking? Right, could you tell that my heart was racing? >> It's a good feeling. >> I don't know. >> Come on! >> I'll be honest, I'm happy it's over, I'm happy. I think I did a really great job and I'm really happy >> Yeah, you did a great job, I love the dragon reference-- >> Have it in the can. >> Fantastic, loved the Game of Thrones vibe there. It was cool-- >> Totally. >> One of the things I wanted pick up on, I thought it was very interesting and unique was the iPhone reference 14 years ago, because that really, to me, was a similar moment because that shifted the smartphone. A computer that happened to make phone calls. And then we all knew who was the leader at that time, Nokia, Blackberry with the phones, and they became toast. That ushered in a whole another era of change, wealth creation, innovation, new things. >> Yeah. Well, up until that moment, carriers had been designing the phones themselves. They were branded with their logos. And so Steve Jobs fought for the design of the iPhone. He designed it with the consumer, with the user in mind. But I think what it really, I mean, it's such a big pivotal moment in our industry because it singled the end of voice revenue and ushered in the era of data. But it also introduced the OTT players, right? That came in through the apps and started a siphon approved from the carriers. And this is like, it's a pivotal moment in the industry, like, changed the industry forever. >> It's a step function, it was a step function change, it's obvious, everyone knew it. But what's interesting is that we were riffing yesterday about O-RAN and Android. So you have iPhone, but Android became a very successful open source project that changed the landscape of the handset. Some are saying that that kind of phenomenon is coming here. Into Telco with software, kind of like an Android model where that'll come in. What's your thoughts on that, reaction to that? >> Yeah, well the dis-aggregation of the hardware, right? We're in the iconic Erickson booth, right? They get most of their revenue from RAN, from Radio Access Networks. And now with the introduction of Open RAN, right? With 50% less CapEx, 40% less OPEX, you know, I think it's easiest for Greenfield operators like Dish, that are building a brand new network. But just this month, Vodafone announced they're going to build the world's largest Open RAN network. Change is happening and the big operators are starting to adopt Open RAN in a real big way. >> So to me, riding the dragon means taking the advantage of new opportunities on top of that dragon. Developing apps like the iPhone did. And you mentioned Android, they got it right. Remember the Windows Phone, right? They tried to take Windows and shove it to the phone-- >> Barely. >> It was a kin phone too. >> I try to delete it from my, look here, beep! >> I'm going to take this old world app and I'm going to shove it into the new world, and guess what, it failed. So if the Telco is trying to do the same thing here, it will fail, but if they start building 5G apps in the cloud and pick the cloud native and think about the consumer, isn't really that the opportunity that you're talking about? >> Well, I think it is, absolutely. And I think it's a wake up call for the vendors in our space, right? And I'm certainly trying to become a vendor with Totogi. I'm really pushing my idea. But you can't take, using your Windows example on the Windows Phone, you can't take a Windows app and stuff it onto a phone and you can't take these old school applications that were written 20 years ago and just stuff them into the cloud, right? Cloud is not a place, it's a way to design applications and it all needs to be rewritten and let's go write, rewrite it. >> It's not a destination as we always say. Let's take a step back on the keynote 'cause I know we just did a couple of highlights there, wasn't the whole thing. We were watching it, by the way, we thought you did a great job, you were very cool and calm under pressure. But take us through the core ideas in the keynote. Break down the core elements of what the talk was about. >> Yeah, I think the headline really is, you know, just like there were good and bad things about the iPhone, right? It killed voice, but introduced data and all these other things. There's good and bad things about the public cloud, right? It's not going to be smooth sailing, no downsides. And so I acknowledge that, even though I'm the self appointed queen, you know? This self appointed evangelist. And so, I think that if you completely ignore the public cloud, try to stick your head in the sand and pretend it doesn't exist, I think there's nothing but downsides for Telcos. And so I think you need to learn how to maximize the advantage there, ride he dragon, like spew some fire and, you know, get some speed and height, and then you can double your ARPU. But I think, going from there, so the next three, I was trying to give examples of what I meant by that, of why it's a double-edged sword, why it's two sides of the coin. And I think there's three areas, which is the enterprise, the network, and a relationship with subscribers. And so that really what the talk, that's what the talk is about >> The three main pillars. >> Yeah, yeah! >> Future, work, enterprise, transition, Open RAN. >> The network and then the relationship with the subscribers. >> Those are the structural elements you see. >> Yeah, yeah, yeah. >> What's the most important one you think, right now, that people are focused on? >> I mean, I think the first one, with work, that's an easy one to do, because there's not too much downside, right? I think we all learned that we could work productively from home. The reason public cloud matter there is because we had tools like Zoom and G Suite and we didn't need to be, I mean, imagine if that this had happened even 20 years ago, right? Broadband at the home wasn't ready, the tools weren't ready. I mean, it would have been, I mean a bigger disaster than it was, right? And so this is an opportunity to sort of ride this work from home wave that a lot of CEOs are saying, we're not coming back or we're going to have smaller offices. And all of those employees need fiber to their home. They need 5G at their home. I mean, if I'm a head of enterprise in a Telco, I am shifting my 5G message from like random applications or whatever, to be like, how are you getting big pipes to the home so your workers can be productive there? And that, I don't hear Telco's talking about that and that's a really big idea. >> You know, you say it's a no brainer, but it's interesting you had your buildings crumbling, which was great, very nice effect in the talk. I heard a executive, Wall Street executive the other day, talking about how, "My people will be back in the office. "I'm going to mandate vaccinations, they're going to be back "in the office, you work for me. "Even though it's an employee friendly environment "right now, I don't care". And I was shocked. I go, okay, this is just an old guy. But, and it's not just the fact that it's an old guy, old guard doing that because I take two examples of old guys, Michael Dell and Frank Slootman. >> Yeah. >> Right, Michael Dell, you know, hundred billion dollar company, Frank Slootman, hottest, you know, software company. Both of them, sort of agree. It's a no brainer. >> Yeah. >> Why should I spend all this money on buildings? And my people are going to be more productive. They love it, so. Why fight the fashion? >> Well, I think the office and I can talk about this for a long time and I know we don't have that much time, but on offices, it's a way to see when did you come in and when did you leave, and look over your shoulder and what we're working on. And that's what offices are for. Now, we tell ourselves it's about collaboration and all this other stuff. And you know, these guys are saying, "come back to the office." It's because they don't have an answer on how to manage productivity. What are you working on? Are you off, are you authentically working 40 hours a week? I want to see, I know if at least you're here, you're here. Now, you might be playing, you know, Minesweeper. You might be playing Minesweeper on your computer, but at least you were, your butt was at your computer. So yeah, I think this is a pivotal moment in work. I think Telcos could push it, to work from home. We'll get you the pipes, we'll get you the cloud-based tools to help manage productivity, to change in work style. >> Yeah, and we've covered this in theCube many times, about how software is going to enable this virtual first model, no one's actually built software for virtual first. I think that's going to happen. Again, back to your team software, but I want to ask you about software defined infrastructure. You mentioned O-RAN, and as software eats the world and eats infrastructure, you still need infrastructure. So, talk about the relationship of how you see O-RAN competing and winning with the balance of software versus the commodity argument. >> Yeah, and I think this is really where people get scared in Telco. I mean, authentically nervous, right. Where you're like, okay, really the public cloud is at that network edge, right? We're really going to like, who are we? It's an identity crisis. We're not the towers anymore. We're renting space, right? We're now dis-aggregating the network, putting the edge cloud right there and it's AWS or Google. Who are we, what do we do, are we networks? Are we a tech company? Right, and so I'm like, guys, you are your subscribers and you don't focus on that. I mean, it's kind of like a last thought. >> So you're like a therapist then too, not just an evangelist. >> I'm a little bit of a therapist. >> Okay, lay down on the couch, Telco. >> Let's talk about what your problems are. (laughs) >> They have tower issues. >> All seriousness, no but, the tower is changing is backhauling. Look at direct connects for instance. The rise of direct and killed the exchanges. I mean, broadband, backhaul, last mile, >> Yeah. >> Completely, still issues, >> Yeah. >> But it's going to software and so that's there. The other thing I want to get to quickly, I know we don't have a lot of time, is the love relationship you talk about with subscribers. We had Peter Adderton on, from a Boost Mobile, formerly Boost Mobile, earlier. He was saying, if you don't have a focus on the customer, then you're just selling minutes and that's it. >> Yeah. >> And his point was, they don't really care. >> Yeah. Let's talk about organizational energy, right? How much energy is contained within any organization, not just Telco, but any organization. To some of your people time is the hours they work per week. And then you think of that as a sack on how you're allocating your time and spending your time, right? And so I think they spend 50% of their time, maybe more, fighting servers, machines, the network, right? And having all these battles. How much of that organizational energy is dedicated to driving great subscriber experiences? And it just shrunk, right? And I think that's where the public cloud can really help them. Like ride the dragon. Let the dragon deal with some of this underlying stuff. So that you can ride a dragon, survey the land, focus on your subscriber and back to the software. Use software, just like the OTT players are doing. They are taking away your ARPU. They're siphoning your ARPU, 'cause they're providing a better customer experience. You need to compete on that dimension. Not the network, not the three Telcos in the country. You're competing again, WhatsApp, Apple, Amazon, Facebook. And you spent how much of your organizational energy to focus on that? Very small. >> And that's where digital platforms roll by, it uses the word platform, why? Because everybody wants to be a platform. Why do you want to be a platform? Because I want to be like Amazon, they're a platform. And you think about Netflix, right? It's not, you know, you don't think about Netflix UK or Netflix Spain, right? >> It's global. >> There's one Netflix >> Yeah, yeah. >> You don't think about their marketing department or their sales department or their customer service, you think about the app. >> Yeah. >> You know. One interface. And that's what digital platforms allow you to do. And granted, there's a lot of public policy to deal with, but if you're shooting satellites up in space, >> Yeah. >> You know, now, you own that space, right, global network. >> And what makes Netflix so good, I think, is that it knows you, right? It knows what you're watching and recommends things, and you're like, "Oh, I would like that, that's great." Who knows more about you than your mobile phone? Carry it everywhere you go, right? What you're watching, what you're doing, who you're calling, what time did you wake up? And right now all of that data we talked about a couple of days ago, it's trapped in siloed old systems. And like why do people think Google knows so much about you? Telco knows about you. And to start to use that to drive a great experience. >> And you've got a great relationship with Netflix. The relationship we have with our our carrier is to your admin, "can you call these guys? "I don't know, I lost the password, I can't get in". >> Right. >> It's like-- >> Or you get SIM hacked-- >> I don't have an hour and a half to call your call center 'cause you don't have a chat bot, right. >> I don't have time. >> Chat bot, right. I can't even do the chat bot because my problem is, you're like, I got to talk to someone. All of their systems are built with the intention of a human being on the other side, and there's all this awesome chat bot AI that works. >> Yeah. >> Set it free. >> Yeah, yeah, right. You almost rather go to the dentist, then calling your carrier. >> Well, we're going to wrap things up here on the keynote review. Did you achieve what you wanted to achieve? I mean, controversy, bold vision, leadership, also that came across, but people they know who you are now. You're out there and that's great news. >> Yeah. I think I rocked the Telco universe and I'm really, that was my goal, and I think I accomplish it so, very excited. >> Well, we love having you on theCUBE. It's great to have great conversations, not only are you dynamic and smart, you're causing a lot of controversy, in a good way and getting, waking people up. >> Making people talk, that's a start. >> And I think, the conversations are there. People are talking and having relationships on the ecosystem open, it's all there. Danielle Royston, you are a digital revolution, DR. Telco DR, thanks for coming to theCube. >> Thank you so much, always fun. >> Good to see you. >> Thanks. >> Of course, back to the Cloud City studios. Adam is going to take it from here and continue on day three of theCube. Adam in studio, thanks for having us and take it from here.

(bright symphony music) >> Hello, I'm John Furrier, the founder of SiliconANGLE Media and co-host of theCUBE. We're here in Paulo Alto at our studio here. I'm joining with Joseph Jacks, the founder and general partner of OSS Capital. Open Source Software Capital, is what OSS stands for. He's also the founder of KubeCon which now is part of the CNCF. It's a huge conference around Kubernetes. He's a cloud guy. He knows open source. Very well respected in the industry and also a great guest and friend of theCUBE, CUBE alumni. Joseph, great to see you. Also known as JJ. JJ, good to see you. >> Thank you for having me on again, John. >> Hey, great to have you come on. I know we've talked many times on theCUBE, but you've got some exciting news. You got a new firm, OSS Capital. Open Source Software, not operational support like a telco, but this is an investment opportunity where you're making investments. Congratulations. >> Thank you. >> So I know you can't talk about some of the specifics on the funds size, but you are actually going to go out, talk to entrepreneurs, make some equity investments. Around open source software. What's the thesis? How did you get here, why did you do it? What's motivating you, and what's the thesis? >> A lot of questions in there. Yeah, I mean this is a really profoundly huge year for open source software. On a bunch of different levels. I think the biggest kind of thing everyone anchors towards is GitHub being acquired by Microsoft. Just a couple of weeks ago, we had the two huge hadoop vendors join forces. That, I think, surprised a lot of people. MuleSoft, which is a big opensource middleware company, getting acquired by Salesforce just a year after going public. Just a huge outcome. I think one observation, just to sort of like summarize the year 2018, is actually, starting in January, almost on sort of like a monthly basis, we've observed a major sort of opensource software company outcome. And sort of kicking off the year, we had CoreOS getting acquired by Red Hat. Brandon and Alex, the founders over there, built a really interesting company in the Kubernetes ecosystem. And I think in February, Al Fresco, which is an open source content portal taking privatization outcome from a private equity firm, I believe in March we had Magento getting acquired by Adobe, which an open source based CMS. PHP CMS. So just a lot of activity for significant outcomes. Multibillion dollar outcomes of commercial open source companies. And open source software is something like 20 years old. 20 years in the making. And this year in particular, I've just seen just a huge amount of large scale outcomes that have been many years in the making from companies that have taken lots of venture funding. And in a lot of cases, sort of partially focused funding from different investors that have an affinity for open source software and sort of understand the uniqueness of the open source model when it's applied to business, when it's applied to company building. But more sort of opportunistic and sort of affinity oriented, as opposed to a pure focus. So that's kind of been part of the motivation. I'd say the more authentically compelling motivation for doing this is that it just needs to exist. This is sort of a model that is happening by necessity. We're seeing more and more software companies be open source software companies. So open source first. They're built in a distributed way. They're leveraging engineers and talent around the world. They're just part of this open source kind of philosophy. And they are fundamentally kind of commercial open source software companies. We felt that if you had a firm basically designed in a way to exclusively focus on those kind of companies, and where the firmware actually backed and supported by the founders of the largest commercial open source companies in the world before sort of the last decade. That could actually deliver a lot of value. So we've been sort of blogging a little bit about this. >> And you wrote a great post on it. I read about open source monetization. But I think one of the things I'm seeing as well that supports your thesis, and I like to get your reaction to it because I think this is something that's not really talked about, but open source is still young. I mean, you go back. I remember the days when we used to have to hide in the shadows to get licenses and pirate stuff and do all those crazy stuff. But now, it's only a couple decades away. The leaders that were investing were usually entrepreneurs that've been successful. The Rob Bearns, the Amar Wadhwa, the guy that did Spring. All these different open source. Linux, obviously, great success story. But there hasn't any been any institutional. Yeah, you got benchmark, other things, done some investments. A discipline around open source. Where open source is now table stakes in all software development. Cloud is scaling, scaling out globally. There's no real foc- There's never been a firm that's been focused on- Just open source from a commercial, while maintaining the purity and ethos of open source. I mean, is that. >> You agree? >> That's true. >> 100%, yeah. That's been the big part of creating the firm is aligning and solving for a pure focused structure. And I think what I'll say abstractly is this sort of venture capital, venture style approach to funding enterprise technology companies, software companies in general, has been to kind of find great entrepreneurs and in an abstract way that can build great technology companies. Can bring them to market, can sell them, and can scale them, and so on. And either create categories, or dominate existing categories, and disrupt incumbents, and so on. And I think while that has worked for quite a while, in the venture industry overall, in the 50, 60 years of the venture industry, lots of successful firms, I think what we're starting to see is a necessary shift toward accounting for the fundamental differences of opensource software as it relates to new technology getting created and going, and new software companies kind of coming into market. So we actually fundamentally believe that commercial open source software companies are fundamentally different. Functionally in almost every way, as compared to proprietary closed source software companies of the last 30 years. And the way we've sort of designed our firm and we'll about ten people pretty soon. We're just about a month in. We're growing the team quickly, but we're sort of a small, focused team. >> A ten's not focused small, I mean, I know venture firms that have two billion in management that don't have more than 20 people. >> Well, we have portfolio partners that are focused in different functional areas where commercial open source software companies have really fundamental differences. If you were to sort of stack rank, by function, where commercial open source software companies are really fundamentally different, sort of top to bottom. Legal would be, probably, the very top of the list. Right, in terms of license compliance management, structuring all the sort of protections and provisions around how intellectual property is actually shipped to and sold to customers. The legal licensing aspects. The commercial software licensing. This is quite a polarizing hot topic these days. The second big functional area where we have a portfolio partner focused on this is finance. Finance is another area where commercial open source software companies have to sort of behaviorally orient and apply that function very, very differently as compared to proprietary software companies. So we're crazy honored and excited to have world experts and very respected leaders in those different areas sort of helping to provide sort of different pillars of wisdom to our portfolio companies, our portfolio founders, in those different functional areas. And we provide a really focused kind of structure for them. >> Well I want to ask you the kind of question that kind of bridges the old way and new way, 'cause I definitely see you guys definitely being new and different, which is good. Or as Andy Jassy would say, you can be misunderstood for a while, but as you become successful, people will start understanding what you do. And that's a great example of Amazon. The pattern with success is traditionally the same. If we kind of encapsulate the difference between open source old and new, and that is you have something of value, and you're disrupting the market and collecting rents from it. Or revenue, or profit. So that's commercial, that's how businesses run. How are you guys going to disrupt with open source software the next generation value creation? We know how value's created, certainly in software that opensource has shown a path on how to create value in writing software if code is value and functionality's value. But to commercialize and create revenue, which is people paying something for something. That's a little bit different kind of value extraction from the value creation. So open source software can create value in functionality and value product. Now you bring it to the market, you get paid for it, you have to disrupt somebody, you have to create something. How are you looking at that? What's the vision of the creation, the extraction of value, who's disrupted, is it greenfield new opportunities? What's your vision? >> A lot of nuance and complexity in that question. What I would say is- >> Well, open source is creating products. >> Well, open source is the basis for creating products in a different kind of way. I'll go back to your question around let's just sort of maybe simplify it as the value creation and the value capture dynamics, right? We've sort of written a few posts about this, and it's subtle, but it's easy to understand if you look at it from a fundamental kind of perspective. We actually believe, and we'll be publishing research on this, and maybe even sort of more principled scientific, perhaps, even ways of looking at it. And then blog posts and research. We believe that open source software will always generate or create orders of magnitude more value than any constituent can capture. Right, and that's a fundamental way of looking at it. So if you see how cloud providers are capturing value that open source creates, whether it's Elasticsearch, or Postgres, or MySQL or Hadoop. And then commercial open source software companies that capture value that open source software creates, whether it's companies like Confluent around Kafka, or Cloudera around Hadoop, or Databricks around Apache Spark. Or whether it's the creators of those projects. The creators of Spark and Hadoop and Elasticsearch, sometimes many of them are the founders of those companies I mentioned, and sometimes they're not. We just believe regardless of how that sort of value is captured by the cloud providers, the commercial vendors, or the creators, the value created relative to the value captured will always be orders and orders of magnitude greater. And this is expressed in another way, which this may be easier to understand, it's a sort of reinforcing this kind of assertion that there's orders of magnitude value created far greater than what can be captured. If you were to do a survey, which we're currently in the process of doing, and I'm happy to sort of say that publicly for the first time here, of all the commercial open source software companies that have projects with large significant adoption, whether, say for example, it's Docker, with millions of users, or Apache Hadoop. How many Hadoop deployments there are. How many customers' companies are there running Hadoop deployments. Or it may be even MySQL. How many MySQL installations are there. And then you were to sort of survey those companies and see how many end users are there relative to how many customers are paying for the usage of the project. It would probably be something like if there were a million users of a given project, the company behind that project or the cloud provider, or say the end user, the developer behind the project, is unlikely to capture more than, say, 1% or a couple percent of those end users to companies, to paying companies, to paying customers. And many times, that's high. Many times, 1% to 2% is very high. Often, what we've seen actually anecdotally, and we're doing principled research around this, and we'll have data here across a large number of companies, many times it's a fraction of 1%. Which is just sort of maybe sometimes 10% of 1%, or even smaller. >> So the practitioners will be making more money than the actual vendors? >> Absolutely right. End users and practitioners always stand to benefit far greater because of the fundamental nature of open source. It's permissionless, it's disaggregated, the value creation dynamics are untethered, and it is fundamentally freely available to use, freely available to contribute to, with different constraints based on the license. However, all those things are sort of like disaggregating the creating of technology into sort of an unbounded network. And that's really, really incredible. >> Okay, so first of all, I agree with your premise 100%. We've seen it with CUBE, where videos are free. >> And that's a good thing. All those things are good. >> And Dave Vellante says this all the time on theCUBE. And we actually pointed this out and called this in the Hadoop ecosystem in 2012. In fact, we actually said that on theCUBE, and it turned out to be true, 'cause look at Hortonworks and Cloudera had to merge because, again, the market changed very quickly >> Value Creation. >> Because value >> Was created around them in the immediate cloud, etc. So the question is, that changes the valuation mechanisms. So if this true, which we believe it is. Just say it is. Then the traditional net present value cash flow metric of the value of the firm, not your firm, but, like, if I'm an open source firm, I'm only one portion of the extraction. I'm a supplier, and I'm an enabler, the valuation on cash flow might not be as great as the real impact. So the question I have for you, have you thought about the valuation? 'Cause now you're thinking about bigger construct community network effects. These are new dynamics. I don't think anyone's actually crunched a valuation model around this. So if someone knew that, say for example, an open source project created all this value, and they weren't necessarily harvesting it from a cash flow perspective, there might be other ways to monetize it. Have you though about that, and what's your reaction to that concept? 'Cause capitalism would kind of shake down the system. 'Cause why would someone be motivated to participate if they're not capturing any value? So if the value shifts, are they still going to be able to participate? You follow the logic I'm trying to- >> I definitely do. I think what I would say to that is we expect and we encourage and we will absolutely heavily invest in more business model innovation in the area of open source. So what I mean by that is, and it's important to sort of qualify a few things there. There's a huge amount of polarization and lack of consensus, lack of industry consensus on what it actually means to have or implement an open source based business model. In fact there's a lot of people who just sort of point blankedly assert that an opensource business model does not exist. We believe that many business models for monetizing and commercializing open source exist. We've blogged and written about a few of them. Their services and training and support. There's open core, which is very effective in sort of a spectrum of ways to implement open core. Around the core, you can have a thin crust or a thick crust. There's SAS. There are hardware based distribution models, things like Sourcefire, and Cumulus Networks. And there are also network based approaches. For example, project called Storj or Stor-J. Being developed and run now by Ben Golub, who's the former CEO of Docker. >> CUBE alumni. >> Ben's really great open source veteran. This is a network, kind of decentralized network based approach of sort of right sizing the production and consumption of the resource of a storage based open source project in a decentralized network. So those are sort of four or five ways to commercializing value, however, four or five ways of commercializing value, however what we believe is that there will be more business model innovation. There will be more developments around how you can better capture more, or in different ways, the value that open source creates. However, what I will say though, is it is unrealistic to expect two things. It is unrealistic and, in fact, unfair to expect that any of those constituents will contribute back to open source proportional to the value that they received from it, or the benefit, and I'm actually paraphrasing Doug Cutting there, who tweeted this a couple of years ago. Very profoundly deep, wise tweet, which I very strongly agree with. And it is also unrealistic to expect a second thing, which is that any of those constituents can capture a material portion of the value that open source creates, which I would assert is many trillions of dollars, perhaps tens of trillions of dollars. It's really hard to quantify that. And it's not just dollars in economic sense, it's dollars in productivity time saved, new markets, new areas, and so on. >> Yeah, I think this is interesting, and I think that we'll be an open book at that. But I will say that what I've observed in looking through all these CUBE interviews, I think that business model innovation absolutely is something that is an IP. >> We need it. Well, it's now intellectual property, the business model isn't, hey I went to business school, learned this at Babson or Harvard, I learned this business model. We're going to do SAS premium. Okay, I get that. There's going to be very interesting new innovations coming, and I think that's the new IP. 'Cause open source, if it's community based, there's going to be formulas. So that's going to be really inter- Okay, so now let's get back to actual funding itself. You guys are doing early stage. Can you take us through the approach? >> We're very focused on early stage, investing, and backing teams that are, just sort of welcoming the idea of a commercial entity around their open source project. Or building a business fundamentally dependent on an open source project or maybe even more than one. The reason for that is this is really where there's a lot of structural inefficiency in supporting and backing those types of founders. >> I think one of the things with ... is with that acquisition. They were pure on the open source side, doing a great job, didn't want to push the business model too hard because the open source, let's face it, you got people like, eh, I don't want to get caught on the business side, and get revenue, perverse incentives might come up, or fear of incentives that might be different or not aligned. Was a great a value. >> I think so. >> So Red Hat got a steal on that one. But as you go forward, there's going to be certainly a lot more stuff. We're seeing a lot of it now in CNCF, for instance. I want to get your thoughts on this because, being the co founder of KubeCon, and donating it to the CNCF, Kubernetes is the hottest thing on the planet, as we talked about many years ago. What's your take on that, now? I see exciting things happening. What is the impact of Kubernetes, in your opinion, to the world, and where do you see that evolving rapidly, and where is the focus here as the people should be paying attention to? >> I think that Kubernetes replaces EC2. Kubernetes is a disaggregated API for distributed computing anywhere. And it happens to be portable and able to run on any kind of computer infrastructure, which sort of makes it like a liquid disaggregated EC2-like API. Which a lot of people have been sort of chasing and trying to implement for many years with things like OpenStack or Eucalyptus. But interestingly, Kubernetes is sort of the right abstraction for distributed computing, because it meets people where they are architecturally. It's sort of aligned with this current movement around distributed systems first designs. Microservices, packaging things in small compartmentalized units. >> Good for integrating of existing stuff. >> Absolutely, and it's very composable, un-opinionated architecturally. So you can sort of take an application and structure it in any given way, and as long as it has this sort of isolation boundary of a container, you can run it on Kubernetes without needing to sort of retrofit the architecture, which is really awesome. I think Kubernetes is a foundational part of the next kind of computing paradigm in the same way that Linux was foundational to the computing paradigm that gave rise to the internet. We had commodity hardware meeting open source based sort of cost reduction and efficiency, which really Linux enabled, and the movement toward scale out data center infrastructure that supported the Internet's sort of maturity and infrastructure. I think we're starting to see the same type of repeat effect thanks to Kubernetes basically being really well received by engineers, by the cloud providers. It's now the universal sort of standard for running container based applications on the different cloud providers. >> And think having the non-technical opinion posture, as you said, architectural posture, allows it to be compatible with a new kind of heterogeneous. >> Heterogeneity is critical. >> Heterogeneity is key, 'cause it's not just within the environment, it's also within each vendor, or customer has more heterogeneity. So, okay, now that's key. So multi cloud, I want to get your thoughts on multi cloud, because now this goes into some of things that might build on top of if Kubernetes continues to go down the road that you say it does. Then the next question is, stateful applications, service meshes. >> A lot of buzz words. A lot of buzz words in there. Stateful application's real because at a certain point in time, you have a maturity curve with critical infrastructure that starts to become appealing for stateful mission critical storage systems, which is typically where you have all the crown jewels of a given company's infrastructure, whether it's a transactional system, or reading and writing core customer, or financial service information, or whatever it is. So Kubernetes' starting to hit this maturity curve where people are migrating really serious mission critical storage workloads onto that platform. And obviously we're going to start to see even more critical work loads. We're starting to see Edge workloads because Kubernetes is a pretty low footprint system, so you can run it on Edge devices, you can even run it on microcontrollers. We're sort of past the experimental, you know, fun and games was Raspberry Pi, sort of towers, and people actually legitimately doing real world Edge kind of deployments with Kubernetes. We're absolutely starting to see multi-geo, multi-replication, multi-cloud sort of style architectures becoming real, as well. Because Kubernetes is this API that the industry's agreeing upon sufficiently. We actually have agreement around this sort of surface area for distributed system style computing that if cloud providers can actually standardize on in a way that lets application specific vendors or new types of application deployment models innovate further, then we can really unlock this sort of tight coupling of proprietary services inside cloud providers and disaggregate it. Which is really exciting, and I forget the Netscape, Jim Barksdale. Bundling, un-bundling. We're starting to see the un-bundling of proprietary cloud computing service API's. Things like Kinesis, and ALB and ELB and proprietary storage services, and these other sticky services get un-bundled because of two big things. Open source, obviously, we have open source alternative data paths. And then we have Kubernetes which allows us to sort of disaggregate things out pretty easily. >> I want to hear your thoughts, one final concept, before we break, 'cause I was having a private conversation with three people besides myself. A big time CIO of a company that if I said the name everyone would go, oh my god, that guy is huge, he's seen it all going back many, many ways. Currently done a lot of innovation. A hardcore network chip guy who knows networking, old school infrastructure. And then a cloud native application founder who knows a lot about software development and is state-of-the-art cloud native. So cloud native, all experienced, old-school, kind of about my age, a cloud native app developer, a big time CIO, and a chip networking kind of infrastructure guy. And we're talking, and one thing that came out, I want to get you thoughts on this, he says, so what's going on with DevOps, how do you see this service mesh, is a stay for (mumbles) on top of the stack, no stacks, horizontally scalable. And the comment that came out was storage and networking have had this relationship with everything since day one. Network moves a packet from point A to point B, and nothing happens in between, maybe some inspection. And storage goes from here now to the then, because you store it. He goes, that premise moves up the stacks, so then the cloud native guy goes, well that's what's happening up at the top, there's a lot of moving things around, workloads and or services, provisioning services, and then from now to then state. In real time. And what dawned on the next conversation the CIO goes, well this is exactly our challenge. We have under the hood infrastructure being programmable, >> We're having some trouble with the connection. Please try again. >> My phone's calling me. >> Programmable connections. >> So you got the programmable on the top of the stack too, so the CIO said, that's exactly the problem we're trying to solve. We're trying to solve some of these network storage concepts now at an application level. Your thoughts to that. >> Well, I think if I could tease apart everything you just said, which is profound synthesis of a lot of different things, I think we've started to see application logic leak out of application code itself into dedicated layers that are really good at doing one specific thing. So traditionally we had some crud style kind of behavioral semantics implemented around business logic. And then, inside of that, you also had libraries for doing connectivity and lookups and service discovery and locking and key management and encryption and coordination with other types of applications. And all that stuff was sort of shoved into the single big application binary. And now, we're starting to see all those language runtime specific parts of application code sort of crack or leak out into these dedicated, highly scalable, Unix philosophy oriented sort of like layers. So things like Envoy are really just built for the sort of nervous system layer of application communication fabric up and down the layer two through layer seven sort of protocol transport stack, which is really profound. We're seeing things like Vault from Hashicorp handle secure key storage persistence of application dedication, authorization, metadata and information to sort of access different systems and end points. And that's a dedicated sort of stateful layer that you can sort of fragment out and delegate sort of application specific functionality to, which is really great for scalability reasons. And on, and on, and on. So we've started to see that, and I think one way of looking at that is it's a cycle. It's the sort of bundling and un-bundling aspect. >> One of the granny level services are getting a really low level- >> Yeah, it's a sort of like bundling and un-bundling and so we've got all this un-bundling happening out of application code to these dedicated layers. The bundling back may happen. I've actually seen a few Bay Area companies go like, we're going back to the monolith 'cause it actually gives us lots of efficiencies in things that we though were trade offs before. We're actually comfortable with a big monorepo, and one or two core languages, and we're going to build everything into these big binaries, and everyone's going to sort of live in the same source code repository and break things out through folders or whatever. There's a lot of really interesting things. I don't want to say we're sort of clear on where this bundling, un-bundling is happening, but I do think that there's a lot of un-bundling happening right now. And there's a lot of opportunity there. >> And the open source, obviously, driving it. So final question for you, how many deals have you done? Can you talk a little bit about the firm? And exciting things and plans that you have going forward. >> Yeah, we're going to be making a lot of announcements over the next few months, and we're, I guess, extremely thrilled. I don't want to say overwhelmed, 'cause we're able to handle all of the volume and inquiries and inbound interest. We're really honored and thrilled by the reception over the last couple weeks from announcing the firm on the first of October, sort of before the Hortonworks Cloudera merger. The JFrog funding announcement that week. The Elastic IPO. Just a lot of really awesome things happened that week. This is obviously before Microsoft open sourced all their patents. We'll be announcing more investments that we've made. We announced our first one on the first of October as well with the announcement of the firm. We've made a good number of investments. We're not able to talk to much about our first initiative, but you'll hear more about that in the near future. >> Well, we're excited. I think it's the timing's perfect. I know you've been working on this kind of vision for a while, and I think it's really great timing. Congratulations, JJ >> Thank you so much. Thanks for having me on. >> Joesph Jacks, also known as JJ, founder and general partner of OSS Capital, Open Source Software Capital, co founder of KubeCon, which is now part of the CNCF. A real great player in the community and the ecosystem, great to have him on theCUBE, thanks for coming in. I'm John Furrier, thanks for watching. >> Thanks, John. (bright symphony music)

>> Live from Toronto, Canada, it's theCUBE, covering Global Cloud and Block Chain Summit 2018. Brought to you by theCUBE. >> Hello everyone, welcome back to theCUBE live coverage in Toronto for the Block Chain-Cloud Convergence Show. This is the Global Cloud Block Chain Summit part of the Futurist Event that's going on the next two days after this. Our next guest is Kesem Frank, AION co-founder and CEO of MavenNet. Doing a lot of work in the enterprise and also block chain space around the infrastructure, making it really interoperable. Of course, Jenna Pilgrim, co-founder and COO of a new opportunity called Network Effects. Welcome to the cube, thanks for joining us. >> Thanks, thanks for having us. >> Thanks, John. >> You guys were just on a panel, The Real World Applications of Block Chain. IBM was on it, which, been doing a lot of work there. This is real world, low hanging fruit, block chain, everyone's pretty excited about. A lot of people get it, and some don't. Some are learning. So you've got the believers, the I want to believe, and then the nonbelievers. Let's talk about the I want to believe and the believers in block chain. Some real world applications going on. As it's evolving, so there's evolution of the standards, technology, but people are putting it to use. What's going on in the sector around some of the real world cases you guys talked about? >> I think we're seeing a lot of collaboration as far as real world applications go, because I think people are sort of starting to understand that if a distributed network is going to work or is going to be secure, it needs diversity and it needs mass scale. If lots of different parties can work together, then they can actually form a community that's really working. As far as real world applications, there's some really interesting one as far as supply chain. Kathryn Harrison at IBM talked about their pilot about shipping, bringing together the global supply chain of distribution. There's a bunch of interesting ones about food providence and bringing together different parties just to make sure that people know what they're eating and that they are able to keep themselves safe, so I think those are two definitely interesting ones. >> Kesem, block chain, supply chain, value chains, these are kind of key words that mean something together. >> Right. >> Making things work in a new way, making things more efficient, seems to be a trend. You're kind of in that world. Is it efficient? (laughing) How's the tech working? What are some of the core threshold issues that people have to get over? >> So you know, John, that's exactly the question to ask. A lot of folks out there are looking at block chain and the promise it represents, and the one big question that keeps echoing over and over is when is this going mainstream? When are we going to see something, a domain, a use case, that is actually natively on a block chain? I think that, essentially, we kind of owe it to ourselves and to everyone that cares about this stuff to ask what's working today, August 2018 and what is still kind of pending? I co-founded a project called AION. For us, interoperability is really one of the key facets that you need to be able to solve for to make block chains real. And again, here's the 60 second argument. If you're going to grow all these solutions that are centric around the use case, they solve for different pinpoints and different stakeholders care about them. They don't really create the cohesive kind of ecosystem until they can all talk to each other, and then you have to ask yourself is the original hypothesis where it's going to be one main net, one chain that's going to rule them all, and everybody gets to play on it and everybody deploys their Dapps on stuff like Fabric or R3 or Ethereum, or whatever it might be. That is absolutely not the way we're seeing enterprise actually shaping into this domain of block chain. What we're seeing is big consortiums that already have value, tangible today, out of doing stuff on chain, and the biggest thing to solve is how do I take, to Jenna's point around supply chain or food providence, whatever it is, how do I actually open it so I can now start writing insurance events, payment events, banking, underwriting, auditing, regulation? There's this gigantic ecosystem that needs to be enabled, and again we are actively saying it's not going to be by an organic model where you and I do everything on top of a single solution. There will be a multitude of solutions, and what we need to solve for is how do we convert them from disparate islands that don't talk to each other into a cohesive ecosystem? >> This is a great point. We were talking on our intro, and we talked last night on our panel, about standards. If you look at all the major inflection points where wealth was created and value was created around innovation and entrepreneurship and industry inflection points, there's always some sort of standard thing that happened. >> Right. >> Whether it's the OSI model during the early days of the internet to certain protocols that made things happen with the internet. Here, it's interesting because if you have one chain and rule the world, it's got to be up and running. >> Yeah. >> It's not. There's no one thing yet, so I see that trend the cloud has, private cloud, public cloud, but public cloud was first but people had data centers. >> Right. >> Both not compatible, now the trend is multi-cloud. You can almost connect the dots of saying multi-chain >> Right. >> Might be a big trend. >> Right. >> This is kind of what you're teasing out here. >> That's exactly what we're about, and I think it's very interesting, the point you're making about dissimilarities between the two domains. We are in a cloud convention, and to me it means two things. One, we absolutely see the mainstream people, the mainstream players in industry, starting to take this seriously. It used to be a completely disparate world where you guys are a bunch of crazies with your Bitcoin and ether and what not. They're definitely taking this seriously now. The second thing, when you think of cloud as a model, how cloud evolved, we used to have these conversations around are you crazy, you're telling me that my data is not going to be on premise? >> It's not secure, now it's the most secure. >> Oh my God! It's in the cloud, what's a cloud? (laughing) You think of the progression model that was applicable back then, right? 10 years, 15 years back, where we started privately and we tell them OK, we'll take this side step of hybrid and then fully public. Took them a while, took them almost 20 years to get their heads around it. >> There's no one trajectory. What's interesting about block chain and crypto with token economics, there's no one trend you can map an analog to, you can't say this is going to be like this trend of the past. It's almost developing it's own kind of trajectory. A lot of organic community involvement. Different tech involvement. >> Totally. >> Different engineering mindsets coming together. You're seeing an engineering-led culture big time going on. That's propelling it up to the conversations of let's lay down the pipes, let's start running apps, but I'll do it within a two year window (laughing). >> I think the big thing to understand about that is yes, you need a whole host of developer talent to build distributed systems, but at the end of the day those systems still have to be used by people. They still have to be used by society, you still have to understand how to talk to your chief executives about what's happening within your company or what your tech teams are doing. There's a growing need for marketers, for PR people, for people who speak, I don't want to say plain English, but people who understand how-- >> Translate it to the real world. >> Yeah, they need to translate it, and how to bridge the gap between legacy systems and how do you take what you were doing before and transform it to a distributed ledger system? How do you do that without just paving the cow path? >> It's interesting, it's almost intoxicating, 'cause you got two elements that get people excited. You got the token economics, which gets people to go, "Whoa," the economics and the liquidity of money and/or value creation capture equations completely changing some of the business model stuff, which could be translated to software and Dapps and software general stuff or SaaS, et cetera. Then you got the plumbing or the networking side of it where things like latency, interoperability, absolutely matter, so with all that going on in real time, it's kind of happening at 30,000 feet and trying to change the airplane engine out. People are failing, and so there's some false promises, there's also false hopes that have not been achieved, so this clouds up the real big picture which is this is an innovative environment. We're seeing that trend. But when you get to the end of the day, what are people working on, to me, is the tell sign. Kesem, what's your project, talk about AION and the work you're doing, specifically give some examples of some of the things that you're doing in the trenches. >> Sure. >> What are you trying to solve, what are some examples you're running into and how does that relate to how things might evolve going forward? >> Sure, so there is a multitude of different problems that we work on but if you want to stick just to the fundamentals? Let's take one gigantic issue that everyone's kind of tackling from different perspectives, let's talk about scale. Scale is, especially in block chains especially challenging just because of how the technology works. How decentralized can you get before you're faced with gigantic latencies and before transaction cost are kind of through the roof? When you think about it, that is all a result of how we kind of contemplate these early stage networks. It was always the one network that is going to scale to infinity. Absolutely not the way it's going to work out. So from my perspective, again, sticking to this one issue, if you could actually give me a decentralized rail that maintains consensus throughout two networks, I can now actually have two trusted kind of go-tos instead of always putting the full brunt of the throughput on one single network. For us, that's kind of a no brainer application to interoperability. If you could actually give me all these trusted networks that work in tandem, I could now start splicing throughputs across many different parallel kind of rails. Not to similar than how we can solve for super computing. We understood there is a limit on how fast can a single CPU go and we started going wide. >> That's an interesting point, I want to just double click on that for a second because if you think about it, why would I have multiple rails and multiple systems? Maybe the use cases are different for them. >> Correct. >> You don't want to have to pick one cloud or one chain to rule them all because it's not optimized. We saw that with monolithic systems and cloud is all about levels of granularity and micro service and micro everything, right? >> Correct. >> And I would also say that gets into a security issue as well, right? You're talking about multiple layers but you also will have multiple layers of permission. You'll have multiple layers of how much information someone can see and what I think is emerging, if data is the new oil, then what's emerging is for the first time we're now able to trust data that we do not own. For corporations who say, "I don't know to market to you "if I don't know everything about you." But at the end of the day, they want to be able to leverage your data but they don't need to secure it and I think that cybersecurity issue is a huge, huge thing that's definitely coming. >> I want to get both of your thoughts on this, because we were talking about this last night. We were riffing on the notion that with cloud compute and data really drove scale. So Amazon is a great example and their value now is things like Kinesis and Aurora, some of their fastest growing services. You got SageMaker, probably will be announced at re:Invent coming up as the fastest growing service, right now it's Aurora. All data concepts. So the dataization really made cloud, great. >> True. >> Okay what's the analog for crypto and block chain? Tokenization is an interesting concept. There's almost an extension of cloud where you're saying, hey, with tokenization, the tokenization phase, how do you explain that to a common person? You say, is token going to be the token and the money aspect of and the economics the killer app? How's it transverse the infrastructures, plural? >> Yeah, or is the wallet going to be the browser? Or how are all of these things happening? >> How do you make sense of this? What's your reaction to that trend? >> So I actually get excited when I think about what token, on the most profound level, actually means. When you kind of think of where value happens in the context of these gigantic enterprises, right? You think of Apple, Amazon, Google, Facebook, any of them, and you kind of think of what the product is, it's all about the data and it's all about how do you convince people to give up data so they can monetize on it. And then you have two distinct, like literally gigantic groups of stakeholders at play. You have the users, that essentially get something free, right? I get to post on Facebook or I get to write an e-mail on Gmail. Then you have the stakeholders that actually extract all that value from my activities. A token, I think most profoundly represents, how do we actually get to a unified group where the user himself is the stakeholder that gets to extract the data? And again, the proposition is pretty straightforward. The more you use a network and the more the network becomes valuable and grows, the more value the token that drives at it. >> So it changes the value capture equation? >> Correct, different model altogether. >> The value creators get to capture the value and obviously network effects plays a big part in this? >> Yes. >> Which is your wheelhouse. (laughing) >> Yeah, definitely. I think it really comes down to core principles. Now you're able to really get down, to what Kesem was talking about, about when you're designing a token or if you're designing an incentive mechanism, you're really going down to the sort of deep game theory of why people do specific things and if we can financially incentivize people to do good rather than punish them or fine them for doing bad then we can actually create value for everyone. We're designing a new economy that now has the ability to propel itself in a fair and prosperous way, if done correctly, obviously that's the disclaimer afterwards, but. >> I love what you're saying there because if you look at collective intelligence a lot of the AI concepts came around from collective intelligence, predictive analytics, prescriptive analytics all came around using data to create value. I always talk about fake news because we have a cloud of media business that's kind of tokenized now but fake news it two things, it's payload, fake news, the fake content and then the infrastructure dynamics that they arbitraged, with network effects. They targeted specific people, fake payload, but the distribution was a network effect. Again, this was the perverse incentive that no one was monitoring, there was no- >> Well and I think in that case, yes there is news that is inherently false information but then there's also a whole spectrum of trueness, if you want to call it that so now we have this technology that allows us to overlay on top of that and say, "Well what is the providence of my information?" And with different layers of block chain systems you're actually able to prove the providence of your information without exposing the user's privacy and without exposing the whole supply chain of the media because there's like media buyers, go through all kinds of hands. >> And we believe the answer to fake news, frankly, is data access, collective intelligence and something like a block chain where you have incentive systems to filter out the fake news. >> Totally. >> Exactly. >> Reputation systems, these things are not new concepts. >> It's all about stake at the end of the day, right? It's how do you keep a stakeholder accountable for their action? You need backing so I think we're definitely on the same page. >> I love, I could talk about fake news all day because we think we can solve that with our CUBEcoin token coming out soon. I want to shift gears and talk about some of the examples we've seen with cloud. >> Sure. >> And try to map that to some navigation for people in how to get through the block chain token world. One of the key things about the cloud was something they called shadow IT. Shadow IT was people who said, hey, you know what? I could just put my credit card down and move this non core thing out in this cloud and prove to my boss, show them, not pitch 'em on the Power Point deck, to say look it, I just did this for that cost in this timeframe, and that started around 2009/2010 timeframe, the early digerati or the clouderati kind of did that but around 2012 it became, wow, this shadow IT is actually R and D practice. >> Mm-hmm. >> Right. >> You started to see that now, so the question that we see for people evaluating in the enterprise is how do you judge what's a good project? Certainly people are kicking the tires and doing a little bit, I won't call it shadow IT, but they're taking on some projects as you were talking about on the panel. How should they, the enterprises in general, the large companies, start thinking about how to enable a shadow IT-like dynamic and how should they evaluate the kind of projects? I think that's an area people just don't know what to look for. Your thoughts? >> I want to add a premise to that, because I think that's absolutely the right question to ask. We also need to add the why. Why should we, as people that do native crypto currency, even care about enterprises? A lot of people kind of theorized when Bitcoin was created to say it was anti institutional is an understatement, right? Aren't we meant to kill enterprise? The thing is, I don't think it's going to be a big bang. I don't think it's going be we wake up and nobody's using banking anymore or nobody's using the traditional healthcare or government and you know whatever insurance policies. We care about block chain in the context of enterprise because we think block chain is a fundamentally better model of doing things. It kind of does away with the black box where I need to be in business, I need to blindly trust you and it introduces a much more transparent and democratic model of doing things. We absolutely want to introduce and make block chain mainstream because that's important for us. When you think of how we do it, to your question, AION is all about interoperability, right? We create a solution that helps scale and helps different networks, decentralized networks, communicate to each other. What we also do with MavenNet, the company I run, is essentially make that enterprise friendly. It's extremely hard to do adoption and implementation within an enterprise, they're very immune to change. >> Antibodies as they say. >> Oh. >> The antibodies to innovation, they kill innovation. >> Totally, so going back to your original question, it all starts with a P and L. If somebody is going to authorize, you know, an actual production system in enterprise for block chain, it needs to create a tangible value, a tangible return, quickly and that's the key. The model that actually scales is you start by flushing out inefficiency plate. You show the enterprise how you could actually achieve, I don't know 20%/30%, that's the order of magnitude that they care about, efficiency by moving some part of your value chain on top of a block chain. >> It has to have an order of magnitude difference or so. I mean cloud was a great example, too, it changes the operating model. >> Yeah. >> They achieve what they wanted to achieve faster and more efficiently and operated it differently. >> Correct. >> And people were starting at it like a three headed monster like what is this thing, right? The cloud thing. And throwing all kinds of fud out there, but ultimately at the end of the day, it's a new operating model for the same thing that they're trying to do with the old stuff. >> Mm-hmm. >> I mean, it's almost that simple. >> Yeah, I think in some cases you need to really, in my previous life at the Block Chain Research Institute, we encouraged a lot of our clients to really take a step back and say, well will I actually, A, will I have this problem in eight years or seven years or 20 years or 50 years, if we're really fundamentally building a new financial system or a new way of doing things that is fundamentally different? Are we building it on old technology? We need to make sure that, and that's why you've seen banks were the first in the door to say, "Yeah, payments, that sounds great, that sounds great." But the real applications that we're seeing from banks are in loyalty, they're in AMLKYC, they're in the sort of fringe operations. Something like payments is going to take a really long time to push through because of those legacy systems because payments is the fundamentals of what banks do. >> This is an interesting point, I want to get your thoughts to end the segment because I think one of the things that we've certainly seen with cloud that over the generational shifts that have happened, the timeframe for innovation is getting shorter and shorter, so timeframe is critical so if the communities are fumbling around hitting that time to value, it seems to be trending to faster and we don't want to hear slower because these systems are inadequate, they're antiquated. >> Mm-hmm. >> These are the systems that are disrupted so the timing of, whether it's standards, or interoperability or business models, operating models, they got to be faster. >> Yeah. >> That's the table stakes. >> I think it all comes down to collaborative governance. >> People have to figure out block chain faster. >> Yeah. >> What's holding us back? Or what's accelerating us? What's the key for the community at large from the engineering community and the business community to make it go faster? Your thoughts? >> Right, so I think we're still searching for the next killer app. If Bitcoin is the reason we're all sitting here today and I profoundly believe that. >> Yeah. >> What is the next thing that drives change on a global scale? That's kind of what we're trying, collectively as an industry, to figure out. Sure, many kind of roadblocks on the way. Some of them educational, perceptional, regulation, technology, but the next big wave that's going to accelerate us to the next ten years of block chain is that next killer app. Organizations such as myself, Jenna, that's our day job, we wake up and that's what we do. >> I mean I've always said, and Dr. Wong, who's the founder of Alibaba Cloud agreed with me, I've been saying that the TCPIP protocol, that standard really enabled a lot of interoperability and created lots of diverse value up the stacks of the OSI model, Open Systems Interconnect, seven layer model, actually never got standardized. It's kind of stopped at TCPIP and that was good, everyone snapped at the line, that created massive value. >> But that's a collaborative governance thing. That's people coming together and saying that these are the standards that we wish to adhere to. >> We need the moment right now. >> Yeah, so you see organizations like the Enterprise Ethereum Alliance coming out with a prospective list of standards that they think the community should adhere here. You know you have the ERC20 standard, you have all these different organizations, the World Economic Forum is playing a role in that and the UN is playing a role, especially when it comes to identity and those kind of really big, societal issues but I think that it comes down to that everyone plays a role that I'm doing my best, I think it's going to be somewhere in the realm of data so that's where I've chosen to sort of make my course. >> I think this is a good conversation to have, and I think we could continue it. I mean, I read on Medium, everyone's reading these fat protocols, thin protocols but at the end of the day what does that matter if there's no like scale? >> Yeah. >> You can have all the fat protocols you want, more of a land grab I would say but there's certainly models but is that subordinate or is that the cart before the horse? This is the conversation I think is in the hallways. >> Totally agree, totally agreed. >> Guys, thanks so much for coming on theCUBE, really appreciate it. Breaking down real world applications of block chain we're at the Global Cloud and Block Chain Summit. It's an inaugural event and think it's going to be the kind of format we're going to see more of, cloud and block chain coming together. Collision course or is it going to come in nicely and land together and work together? We'll see, of course theCUBE's covering it. Thanks for watching. Stay with us for more all day coverage. Part of the Futurist Conference coming up the next two days. We're in Toronto, we'll be back with more after this short break. (theCUBE theme music)

>> Announcer: Live, from Vancouver, Canada it's the CUBE, covering OpenStack Summit North America 2018, brought to you by Red Hat, the Open Stack Foundation, and it's ecosystem partners. >> Welcome back, I'm Stu Miniman and my cohost John Troyer and you're watching the CUBE, the worldwide leader in tech coverage. Happy to welcome back to the program long time friend of the CUBE back from the earliest days, Randy Bias, Vice President with Juniper, Randy, great to see you. >> Absolutely, great to be back with you guys. >> All right, so Randy, we've been talking about, you know, community, and everything's going good and attendance might be down a little bit but how we fit in with containers and kubernetes, and everything, so we expect you to tear everything up for us and tell us the reality of what's happening in this community. >> I'll do my best (laughing). >> All right, so before we get to the kubernetic stuff, you're working on, we used to call it OpenContrail? Which you were involved in before Juniper acquired it, went through a rebranding recently, Tungsten, which I was looking up, came from the word heavy stone, give us the update from the networking side. >> Yeah, so the short history is that there was a company called Contrail, and they created a software defined networking controller, it was acquired by Juniper in 2012, 2013, and then that was open sourced, so Juniper for a long time was running with sort of two editions, Contrail which was the commercial offering, and OpenContrail which was the open source, and then shortly after I joined Juniper, identified that, you know, we really needed to go back to the drawing board on the way that we had organized the community, and transition it from being Juniper-led to community led, and so over the past year, I spearheaded that effort, and then that culminated in us announcing at the end of March at ONS that, you know, OpenContrail was now Tungsten Fabric. We renamed it, we moved it into the Linux foundation, under its governance, and now Juniper is one of many people of the community that have a seat at the table for the management, both from a business and technical perspective, and we're moving forward with a new reinvigorated community. >> Yeah, so networking sits at really the intersection of this multi-cloud world that we're living in. There's so many players trying to be there, you know Cisco, really moving to become more of a software company, when I interviewed their number two guy at their show, he's like, when you think of Cisco in the future, we're not even going to be a networking company, we'll be a software company. VMware, of course, pushed heavy through, then the Nicira acquisition, where does Tungsten fit, kind of compare and contrast for us, where it fits among some of these other offerings out there in the marketplace. >> Yeah, I mean, I think most enterprise vendors are in a similar transition from being a hardware to software companies. We're no different than any of the rest. I think we have a pretty significant advantage in that we have a lot of growth in the cloud sector, so a lot of the large public clouds are our customers and we're selling a tremendous amount of hardwaring to them, so I think we've got a lot longer runway. But, you know, we just recently hired CTO, Bikash Koley, out of Google, and we're starting to see some additional folks out of Google, like my new boss, Morgan, and what that's bringing with it is a very much a software first type perspective. So Bikash and Morgan really built everything for the Google network from the topper rack all the way out to the win and it's almost all software-based, disaggregated, hardware, software, opensource software running on top of white boxes, and so that kind of perspective is now really deep, start beginning to become embedded in Juniper. And at the head of that is Tungsten. So we see Tungsten Fabric as being sort of a tool that we use to create, you know, a global ubiquitous network fabric, that anybody can use anywhere, without talking to Juniper at all, without knowing that Juniper's part of Tungsten, and then as they grow up and they get to a point where they need multi-cloud, they need federation, or they need kind of day two enterprise operations, you know, we have a commercial version and a commercial distribution that they can use. >> Randy, we talked a little bit about OpenContrail and last year, at OpenStack Summit and moving it to a more of a community based governance model, and now that's happened with the Linux Foundation, can you talk a little bit about the role of opensource governance, and corporate governance, and then foundations, and just going forward, you know, what's an effective model for 2018 going forward, for a foundation-led project and maybe in the context of Tungsten Fabric, and how is that looking? >> Yeah, so again, OpenContrail's now Tungsten Fabrics, might be new for some of the viewers, lot of people still coming to terms with that. And so one of the things that we noticed is that, and when many people go and they say, hey, we want opensource first, the AT&T's of this world, part of what they're saying, one of the aspects of being opensource versus we want to be one of many around the table, we want to have a seat at the table, we want to have the option to contribute code back, and we want to feel like it's a group effort. And so that was a big factor, right? It was an opensource project, but it was largely the governance was carried by Juniper, all the testing infrastructure was Juniper, you know, all of the people who made architectural decisions were Juniper, all of the lead contributors were Juniper, and so, going to Linux Foundation was critical to us having a legal framework, for the trademarks, the code, the licenses, the contributor license agreements, are all owned and operated by the Linux Foundation and not by Juniper, so we basically have a trusted third party who can mediate all those things and create a structure, a governance small structure where Juniper has one seat at the table, and all the other community members do as well. So it was really key to getting, to moving to that model to increase people's interest in the project and to really go the next level. There just wasn't any way to do it without doing this. >> All right, so, Randy, let's talk about OpenStack. You were watching the keynote yesterday, you were, you know, in the Twitter stream, >> Randy: I don't usually watch keynotes, man. >> Stu: But you know this community, so-- >> I do know this community (laughing). >> Give us kind of the good, the bad, and the ugly from your standpoint as to, you know, where we've gone, you know, what's doing well, and what you're frustrated as heck that we still haven't fixed yet. >> Well, I mean, it's great that we have so much inroads amongst the carriers, it's great that, you know, that there's a segment that OpenStack has been able to land in. I mean, at some points when I was feeling particularly pessimistic on some days, I was like, oh man, this thing's never going to go anywhere, so that's great. On the other hand, you know, the promise that we had of sort of being the Linux operating center, operating system of the data center, and you know, really gaining inroads into private cloud and enterprise, that just hasn't materialized and I don't see a path to that. A lot of that has to do with history, I'm not sure how much of that I want to go into here, but I see those as being bright lights. I see the Ocata containers effort and sort of having this alternative structure that's more or less like the umbrella structure that I lobbied for while I was on the board. So for several years on the board, I said we need to really look more like the Apache Software Foundation, we need to look less like the Linux Operating System in terms of how we think about things. Not this big integrated monolithic release, you need more competition between projects and that just wasn't really embraced. And I think that that, in a way, that was one of several things that really kind of limited our ability to capture the market that we really wanted, which is the enterprise market. >> Yeah, well, I know, and one of those sticking points there that I've talked to you many times over the years about is how do I actually deploy this? You know, getting a base configuration and scaling this out, simplicity is tough, getting to those environments, you know, getting it up in two weeks, is good for some environments, but maybe not for others. >> Yeah, I mean I think there's sort of a spectrum, right? At one end of the spectrum, you say hey, I'm going to have a very opinionated approach like kubernetes does, and we're going to limit what we say we can do, you know, we're not all things to all people. And I think that opinionated approach, like the Linux operating system worked very, very well. And then other end of the spectrum is we've got no opinion like the Apache Software Foundation, and then it's up to vendors to go and cherry pick the pieces they want and turn that into some kind of commercial offering, whether it's Hortonworks, or Thi-dare or Du-per or whatever it is, the problem is that OpenStack wound up in the middle where it had the sort of integrated monolithic release cycle which it still does, which started to be all things to all people, and it was never as great as it could be, so it's like we got to support Hyper-V, we got to support VMware, and as the laundry list of all things we have to support grew longer, it became more and more difficult to have a compelling, easy to use, easy to scale offering that any enterprise could consume. >> Randy, a lot of talk this week about edge computing, with several different definitions, right? But it does strike me that, you know, there's a certain set of apps, that you write 'em and that they live fine in a big public cloud, and a big data center somewhere. But there's a lot of hardware that's going to be living out in the world, whether that's at the base of a radio tower, or in a wall, or in my shoe, that is going to be running hardware, and is going to be running something, and sometimes that something can be OpenStack, and we're seeing some examples of it, many examples of that already. Is that an area of growth for OpenStack? Is that an interesting part of how this fabric is going to expand? >> Well, I probably have a contrarian view here. So, I spent a bunch of time at Juniper, one of the things I worked on for a while was edge computing and we're still trying to decide what we want to do there and you know, kind of to the first point you made is everybody's edge is different, right? Is it on the mobile phone, is it back in the data center, the difference is that the real estate gets more expensive as you move out, right? And it's in terms of latency, and it's in terms of bandwidth and it's also in terms of cost of storage and compute. There's a move closer to the mobile device that becomes progressively more expensive, and so that's why a lot of people sort of look and say hey, wouldn't it be nice if we can get you out the closer lower latency and bandwidth and so on but as we looked at it, a lot of the different use cases it became really interesting in that, it wasn't clear if there was that much value between 5 milliseconds and 20 milliseconds, right? I mean, that's pretty, either one's pretty close, sure there's a lot of difference between 20 and a 100, but maybe not so much between 5 and 20. And so we kind of came to the conclusion that at least for right now, probably, the bulk of use cases are fine with 20 milliseconds, and what that means is that regional systems like AWS's Lambda at the Edge, they're in metro, those are probably good for most cases. I don't know that you need to be on the tower, I don't know that you need to be in the central office, so I think edge computing is still nascent, we don't know exactly what all those use cases are, but I think you might be able to service most of them from regional data centers, and then the question really becomes what does that stack need to be and if you have a regional data center that's got plenty of power, plenty of space, then it might be that OpenStack is a good solution, but if you're trying to scale down onto the tower, I got to have some doubts about whether OpenStack can really scale down that far. >> Randy, analytics is something we've been seeing, the networking people used for many years, at this show, starting to hear a lot of discussion about AI and ML, would love your view point as to what you're seeing in that space. >> You know I have some friends who started off in AI in very early days and he had a very pessimistic view. He said, you know this stuff comes and goes, but I'm actually very positive and optimistic about it because the way I look at this is there's a renaissance happening which is that, you know, now ML is really available to masses and you're seeing people do really interesting things like, we have a product called AppFormix, and what they do is they take ML and they apply it to operations and I love this because as an operations guy, you know, I used to have these problems in production where something would go out and the first thing I'd do, is I'm trying to do correlation and then root cause analysis, like, what was the actual failure? Like I can see the symptom on this end and now I have to get all the way back to what caused it, and the reality is that machine learning, AI techniques and protocols can do all the heavy lifting for operators very, very quickly and basically surface a problem for somebody to do the final analysis on. And so I do think that ML and AI apply to very specific vertical problems, it is just a place where we're going to see a tremendous amount of revolution in the next couple years. >> All right, and that hits right at really that intersection between kind of the developers and the operators there-- >> Absolutely. >> What are you seeing from an organizational standpoint, companies you're talking to these days, how are they doing adopting that change, dealing with that, you know, often schism or are they bringing those groups together? >> Well, I think you remember that like in the early days, I used bring my deck along and I would talk about assembly line IT versus the robotics spectrum all of IT and I would sort of make that sort of analogy to sort of the car manufacturing process, and I think what machine learning is really going to do is take us to that next level past that right? So we had the assembly line where we have all the specialists, we had the robotics factory where we had people who know how to build a robots and software, and it's really sort of like, just churning out with a lot of people on the line, and I think the next level after that is, you know, completely fully automated applications driving themselves, you know, self-driving applications, and I think that's when things get really interesting, and maybe we start to remove the traditional operator out of the equation and it really becomes about empowering developers with tools that are comfortable and that leverage all the cloud era and stuff that we built. >> All right, so Randy, you're credited with the pets versus cattle analogy, what's the latest, you were talking about some of the previous slide decks, what's Randy Bias looking on down the road? >> I mean, the stuff just comes to me, man. I can't like predict, but the thing I've been talking about a lot lately is services of platform, I think we might've talked about that last time, which is just this notion that if we look at where Amazon's invested and what's interesting, it's certainly not at the infrastructure layer and it's really not at the PAS layer, it's that thick layer in between with like database as a service and NoSQL as a service, and messaging service, and DNS and so on, where you can kind of cherry pick those things as you're assembling your own PAS for your application, and I still think that's the area that is under-discussed, and the reason is is the people back into basically doing that, building kind of the service as a platform system, but they're not like going into it, kind of like eyes wide open. >> Yeah, so just following up on that last piece, one of the criticisms I have this week is when you talk about multi-cloud, most of the people talk about, oh well people are clawing things back to their data centers. Juniper plays across the board, strong partnership with Amazon, yet you're here, what are you hearing from customers, you know, what do you see as kind of the balance there and, you know, the public cloud's role in the world? >> I mean, they're still winning, right? I don't think there's any doubt, I haven't seen a decline back here talking about, but we are starting to enter into the era of, okay, this stuff is out there, and it's running, but I need to find my governance model, I need to understand who's using what, I need to understand what it's costing me, and that's the sign of the maturation process. And so I think that, you know, we saw in the early days of cloud, people jumping the gun, creating compliance services, and you know, SAS products that would basically measure how much you're spending and think that it's time for that stuff to come back in vogue again, because the tool needs to be there for people to manage these extended supply chain of IT vendors which include the public cloud. And I think that the idea that would claw them back as opposed to like just see that as holistic part of what we're trying to accomplish doesn't make any sense. >> Well learned. Well, Randy Bias, always a pleasure to catch up with you. >> John. >> John Troyer, I'm Stu Miniman, getting towards the end of two days of three days of live coverage. Thanks for staying with the CUBE. (bubbly electronic music)

live from Vancouver Canada it's the cube OpenStack summit North America 2018 brought to you by Red Hat the OpenStack foundation and its ecosystem partners welcome back I'm Stu minimun here at the OpenStack summit 2018 in Vancouver with my co-host John Troyer happy to welcome to the program a first-time guest Charles Ferlin who's the vice president of business development at nuage networks thanks for joining us thank you for having me all right so the OpenStack show we're always talking about the maturity of it where customers are going with it you're in business development so what one of the one of the things we were discussing from the keynote this morning is the telcos and the service providers and who's doing what and you know who makes up that environment so it gives us your free point what you're seeing as to you know where some of the real action is in this in this marketplace fair enough we've been talking about nav for example for many years as you know but I would say probably since the second half of 2016 that we've started to see some significant large deployment and the service provider service provider paying attention to building up a telco cloud to host their VN nav applications right so so really from the second half of 26 16 2017 we've seen massive deployments of OpenStack with a service provider and a lot of them to host applications to serve their branch office customers yeah that's that's an another motivation for them to deploy this yes so Charles you know we've talked to the 18 t Verizon you know Deutsche Telekom's up there all these big ones but I look at it and say is this an opportunity of 20 global you know you know you know telcos or is do we go down to some of the MSP CSPs however you want to call those service providers a regional one you know they're some of the regional ones that maybe aren't as much telcos or are they where's that line what do you see is kind of the TAM if you will for this space obviously the large service provider will have a piece there but we see a lot of regional customer consuming services from a local provider right they do have either for language reasons for regulation and in governance so we see a lot of them consuming services from a local service provider so an openstack sort of became the building block of these and if the infrastructure for the service provider yeah it's interesting we actually just had a infrastructure as a service company from Australia okay on and I said you know you look at their website it doesn't say OpenStack anywhere they provide cloud offerings so it's one of the things there's all these telcos and service fighters that use it but it's not like they're like we're your preferred distribution of OpenStack it's just part of the plumbing underneath the use cases that that are address buh-bye OpenStack and served by OpenStack really fits well and a lot of the telco space right now yeah so we've seen a lot of growth for virtual private cloud we see a lot of growth for a dynamically deploying application having application residing in the data center or moving closer to the users at the edge for example and these are sort of the use cases that nuage and OpenStack address pretty well well that's an interesting pivot point right I understand as an enterprise technologist why software-defined networking is important right it's important in your stack it's got to be important inside of an open OpenStack but can you talk a little bit about some of these use cases like I hadn't really thought about SD win and how that that really and what architectures and deployments would really kind of mean that they would need to deploy that with some and that's a good point because really NT as the win served as the catalyst for the service providers who start paying attention to deploying an NFV infrastructure before that there was an interest it was a motivation however SD wins be offered of dynamic flexible agile branch office connectivity that allows them to dynamically insert value-added services so yes as the one provided connectivity between the branch office but really where is the service provider are going after is offering Application Firewall DDoS services or URL filtering in all of these applications residing in the data center and all of a sudden as I hold on I cannot have it as the one solution disjoint from my data center OpenStack deployment and this is where the nuage actually served as a connecting to both environment but also this is what served as a catalyst the sd1 deployment sort of a catalyst for for them to start deploying a dynamic infrastructure in today's yes so Charles just on the SD way in piece itself we've seen a lot of activity that bunch of acquisitions in that market what what differentiates nuage in in this space well fair enough we've seen these acquisition as a complement to the strategy that we have taken over the past five years paying off we are from the get-go started to have an end-to-end as the in solution so it's not just about connecting branch office together it's not about just connecting application in the data center it's actually connecting the users in the branch office with the applications in the data center or in the public cloud and what differentiate us the most is that we have the exact same platform the same as the n solution and 2n to connect branch office programming branch routers or programming virtual switches in the data center or bare metal physical service so that is perhaps new our single most biggest differentiator is the capability to have that single policy that singled as the n framework from the users and branch to the data center or public cloud alright you've mentioned bare metal I remember it was funny when the project came out for bare metal of course it's called ironic because most people can't win OpenStack started it was it's a good name in that it was virtualized environment of course today we've got containers starting to go up the stack with kubernetes so we understand why bare metals there what are you seeing in that space and and what what kind of what do you hear from your customers so we we have a lot of traction with ironic actually it's ironic but we do and we did that actually in open Saxony in November we did a Coe presentation with Fujitsu who deployed our k5 infrastructure using nagy networks and ironic integration to roll out on top of that is flexible you can put a platform as a service they can do whatever they want on top of it but the bare amount of provisioning is somewhere we is a we have a couple of large accounts that they have deployed this globally yeah okay are you working with the cotta containers that they have here and whether you are not would love to hear kind of the security story when we talk things everything for bare metal in containers and what you're doing with OpenStack and that's that's perhaps the other the biggest differentiator we have is because we're able to have the single networking policies from a container to or programming the network of a container or a KVM VM or hyper-v or the we have the symbol their single as the end platform and we're able we see all the therefore we see all the traffic in the data pack and we're able to index this into a elasticsearch database right and and in creating an index and set a lot of users to create some thresholds and that is what is perhaps the newest thing at knowledge is the capability now to say hey once those thresholds or cross why don't we reprogram the network dynamically so near realtor in real near-real-time we're actually able to take an action to reprogram the network based on some live feed that's what can information that we're receiving from the the various element that we have program either in the branch office or in a container level okay so today cotta containers is not something you're involved with or I didn't quite that cotta containers from the new high-level project from the the OpenStack foundation I don't know right now but but your customers are using container technology docker and various others we have an integration with kubernetes so we provide CNI they're absolutely involved there and this is how a lot of our customers are using us right now and the customers we're talking about these would often be service providers is that is that correct in the context of containers and kubernetes it would mainly be on the enterprise okay out of an agile type of development where they want to have a there's a lot of developer and they want to have the networking program and the same life cycle as the application project is rolling out and having the micro segmentation meaning that we are able to isolate each one of the project from one another so in if one gets contaminated the other one doesn't and so this is where a lot of the kubernetes and deployment has been on the on the large enterprise okay that makes sense because I'm trying to as a as a person outside the telecom industry but but following kind of the enterprise and OpenStack it's interesting to see this vision of the service providers who are not dumb pipes certainly but through OpenStack and these these the nfe and the services they are able to provision with folks like nuage you know able to provide services so just trying to figure out where the line you know maybe you could draw us a picture of you know what what the modern service provider will be able to provide versus what's still left then for the at the enterprise level depending on which market size analysis analyst you're looking at you know is depends VPN connectivity will be it it varies between two to six to eight to twelve it's a relatively contained small market compared to the applicator to manage applications right manage security that's tenfold that that market race so really as you said the the objective here if the service provider is not to to become a dumb virtual pipe and the ability to dynamically insert some value-added services over the top and this is what having an agile as the when now gives them the capability to say hold on a second I can now start serving a value-added application because my dynamic network is available now and this is this is what is fueling a lot of the OpenStack deployment right now in the datacenter yeah Charles one of discussions we've been looking at the last couple of years is there's OpenStack and then there's containers and kubernetes everything how do you see those go together what are you hearing from customers general discussion here but I'd love to hear some real-world so yeah in the context of ironic as we just mentioned a lot of the time the bare metal servers are actually deployed using OpenStack and what goes on top of it is actually kubernetes right and this is very common and it gives that isolation or its deploying a virtual machine running a pass platform in there right so so actually we do see the OpenStack to be used often to deploy the the infrastructure and program and provision I should say the infrastructure and whatever goes on top it could be kubernetes and work just a very nicely Charles you've been involved with OpenStack for many years I had this is how many OpenStack summits well probably eight and a weight or more yeah how are you seeing the OpenStack community evolved what do you I know you've just arrived which day one here at this summit you know beautiful Vancouver but in terms of the energy of the community the the people who are here it's a little bit smaller this year but it you know we've got people here are actual users and actual deployers so exactly yeah thoughts there so this is perhaps the well we went through a marketing height which is great however what I would say regardless of the event today in general the OpenStack community is a lot more mature it's a lot more stable as well and in the product and the product the technology at the community is more focused around solving real use cases and real problem couple years ago there was a lot of interest a lot of hype you know but it would have solve world world hunger as well right now I think it's very pointed very precise and I'm actually new I was quite proud to be participating in contributing in that community because we're starting to see the technology really addressing key key problems here all right Charles last thing I wanted to ask is the network sits in a very special place when you talk about really the multi cloud world that customers are talking about what are you seeing when it comes to that environment you know how do customers figure out where they put their applications are they moving you know things or is it just kind of a heterogeneous but still complicated world they're still figuring out that's right I mean that it's a very dynamic environment but I would say if I had to draw a conclusion most of the customers are deploying the application on-premise they like to have either for storage either for some of the governance they do I like to have applications on-premise however the multi cloud scenario is often used in large banks to compute or a large organization to compute on a burst capability right the capability to say hey I need to have X compute power available for X time is very appealing for them and this is how most of the deployment of nuage are used right now is having doing the plumbing the virtual plumbing inside a data center and dynamically based on demand the capability to do the same networking policy the same networking extension to one of the public cloud offering is very appealing because it sporadic it's a burst type of scenario yeah especially a lot of those service providers have that direct ability right as well correct correct and it you're right that it can become a little bit complex when you have when you want to to deploy nets with the same that's working policies across on-premise and multiple cloud provider and if you have interim service provider then it becomes a little bit complicated to have to orchestrate all of it and this is where Sdn gives them that hardware abstraction and and maintain the same networking policy well Charles Berlin appreciate the update on nuage and all of your viewpoints from from the customers that you're seeing my pleasure very very much for John Troyer I'm Stu Mittleman back with more coverage here at the open sex I'm at 2018 in Vancouver thanks for watching the Q [Music]

>> Announcer: Live, fro-- >> Announcer: Live from Vancouver, Canada it's theCUBE! Covering OpenStack Summit North America 2018. Brought to you by Red Hat, the OpenStack Foundation, and it's ecosystem partners. >> Hi and welcome to SiliconANGLE Media's production of theCUBE here at OpenStack Summit 2018 in Vancouver. I'm Stu Miniman with my cohost, John Troyer. We're here for three days of live wall-to-wall coverage at the OpenStack Foundation's show they have it twice a year John, pleasure to be with you again, you and I were together at the OpenStack show in Boston, a year ago, little bit further trip for me. But views like this, I'm not complaining. >> It's a great time to be in Vancouver, little bit overcast but the convention center's beautiful and the people seem pretty excited as well. >> Yeah so if you see behind us, the keynote let out. So John, we got to get into the first question of course for some reason the last month people are always Hey Stu where are you, what're you doing and when I walk through the various shows I'm doing when it comes to this one they're like, why are you going to the OpenStack show? You know, what's going on there, hasn't that been replaced by everything else? >> I got the same thing, there seems to be kind of a almost an antireligious thing here in the industry maybe more emotional perhaps at other projects. Although frankly look, we're going to take the temperature of the community, we're going to take the temperature of the projects, the customers, we got a lot of customers here, that's really the key here is that our people actually using this, being productive, functional, and is there enough of a vendor and a community ecosystem to make this go forward. >> Absolutely, so three years ago, when we were actually here in Vancouver, the container sessions were overflowing, people sitting in the aisles. You know containers, containers, containers, docker, docker, docker, you know, we went through a year or two of that. Then Kubernetes, really a wave that has taken over, this piece of the infrastructure stack, the KubeCon and CloudNativeCon shows, in general, I think have surpassed this size, but as we know in IT, nothing ever dies, everything is always additive, and a theme that I heard here that definitely resonated is, we have complexity, we need to deal with interoperability, everybody has a lot of things and that's the, choose your word, hybrid, multi-cloud world that you have, and that's really the state of opensource, it's not a thing, it's there's lots of things you take all the pieces you need and you figure out how to put 'em together, either buy them from a platform, you have some integrator that helps, so somebody that puts it all together, and that's where, you know, we live here, which is, by they way, I thought they might rename the show in the open, and they didn't, but there's a lot of pieces to discuss. >> Definitely an open infrastructure movement, we'll probably talk about that, look I loved the message this morning that the cloud is not consolidating, in fact it's getting more complicated, and so that was a practical message here, it's a little bit of a church of opensource as well, so the open message was very well received and, these are the people that are working on it, of course, but yeah, the fact that, like last year I thought in Boston, there was a lot of, almost confusion around containers, and where containers and Kubernetes fit in the whole ecosystem, I think, now in this year in 2018 it's a lot more clear and OpenStack as a project, or as a set of projects, which traditionally was, the hit on it was very insular and inward facing, has at least, is trying to become outward facing, and again that's something we'll be looking at this week, and how well will they integrate with other opensource projects. >> I mean John, you and I are both big supporters of the opensource movements, love the community at shows like this, but not exclusively, it's, you know, Amazon participating a little bit, using a lot of opensource, they take opensource and make it as a service, you were at Red Hat Summit last week, obviously huge discussion there about everything opensource, everything, so a lot going on there, let me just set for, first of all the foundation itself in this show, the thing that I liked, coming into it, one of the things we're going to poke at is, if I go up to the highest level, OpenStack is not the only thing here, they have a few tracks they have an Edge computer track, they have a container track, and there's a co-resident OpenDev Show happening a couple floors above us and, even from what the OpenStack Foundation manages, yes it OpenStack's the main piece of it, and all those underlying projects but, they had Katacontainers, which is, you know, high level project, and the new one is Zuul, talking about CI/CD, so there are things that, will work with OpenStack but not exclusively for OpenStack, might not even come from OpenStack, so those are things that we're seeing, you know, for example, I was at the Veeam show last week, and there was a software company N2WS that Veeam had bought, and that solution only worked on Amazon to start and, you know, I was at the Nutanix show the week before, and there's lots of things that start in the Amazon environment and then make their way to the on-premises world so, we know it's a complex world, you know, I agree with you, the cloud is not getting simpler, remember when cloud was: Swipe the credit card and it's super easy, the line I've used a lot of times is, it is actually more complicated to buy, quote, a server equivalent, in the public could, than it is if I go to the website and have something that's shipped to my data center. >> It's, yeah, it's kind of ironic that that's where we've ended up. You know, we'll see, with Zuul, it'll be very interesting, one of the hits again on OpenStack has been reinvention of the wheel, like, can you inter-operate with other projects rather than doing it your self, it sounds like there's some actually, some very interesting aspects to it, as a CI/CD system, and certainly it uses stuff like Ansible so it's, it's built using opensource components, but, other opensource components, but you know, what does this give us advantage for infrastructure people, and allowing infrastructure to go live in a CI/CD way, software on hardware, rather than, the ones that've been built from the dev side, the app side. I'm assuming there's good reasons, or they wouldn't've done it, but you know, we'll see, there's still a lot of projects inside the opensource umbrella. >> Yeah, and, you know, last year we talked about it, once again, we'll talk about it here, the ecosystem has shifted. There are some of the big traditional infrastructure companies, but what they're talking about has changed a lot, you know. Remember a few years ago, it was you know, HP, thousand people, billion dollar investment, you know, IBM has been part of OpenStack since the very beginning days, but it changes, even a company like Rackspace, who helped put together this environment, the press release that went was: oh, we took all the learnings that we did from OpenStack, and this is our new Kubernetes service that we have, something that I saw, actually Randy Bias, who I'll have on the show this week, was on, the first time we did this show five years ago, can't believe it's the sixth year we're doing the show, Randy is always an interesting conversation to poke some of the sacred cows, and, I'll use that analogy, of course, because he is the one that Pets vs Cattle analogy, and he said, you know, we're spending a lot of time talking about it's not, as you hear, some game, between OpenStack and Kubernetes, containers are great, isn't that wonderful. If we're talking about that so much, maybe we should just like, go do that stuff, and not worry about this, so it'll be fun to talk to him, the Open Dev Show is being, mainly, sponsored by Mirantis who, last time I was here in Vancouver was the OpenStack company, and now, like, I saw them a year ago, and they were, the Kubernetes company, and making those changes, so we'll have Boris on, and get to find out these companies, there's not a lot of ECs here, the press and analysts that are here, most of us have been here for a lot of time so, this ecosystem has changed a lot, but, while attendance is down a little bit, from what I've heard, from previous years, there's still some good energy, people are learning a lot. >> So Stu, I did want to point out, that something I noticed on the stage, that I didn't see, was a lot of infrastructure, right? OpenStack, clearly an infrastructure stack, I think we've teased that out over the past couple years, but I didn't see a lot of talk about storage subsystems, networking, management, like all the kind of, hard, infrastructure plumbing, that actually, everybody here does, as well as a few names, so that was interesting, but at the end of the day, I mean, you got to appeal to the whole crowd here. >> Yeah, well one of the things, we spent a number of years making that stuff work, back when it was, you know, we're talkin' about gettin' Cinder, and then all the storage companies lined up with their various, do we support it, is it fully integrated, and then even further, does it actually work really well? So, same stuff that went through, for about a decade, in virtualization, we went through this in OpenStack, we actually said a couple years ago, some of the basic infrastructure stuff has gotten boring, so we don't need to talk about it anymore. Ironic, it's actually the non-virtualized environments, that's the project that they have here, we have a lot of people who are talking bare metal, who are talking containers, so that has shifted, an interesting one in the keynote is that you had the top level sponsors getting up there, Intel bringing around a lot of their ecosystem partners, talking about Edge, talking about the telecommunications, Red Hat, giving a recap of what they did last week at their summit, they've got a nice cadence, the last couple of years, they've done Red Hat Summit, and OpenStack Summit, back-to-back so that they can get that flow of information through, and then Mark Shuttleworth, who we'll have on a little bit later today, he came out puchin', you know, he started with some motherhood in Apple Pi about how Ubuntu is everywhere but then it was like, and we're going to be so much cheaper, and we're so much easier than the VMwares and Red Hats of the world, and there was a little push back from the community, that maybe that wasn't the right platform to do it. >> Yeah, I think the room got kind of cold, I mean, that's kind of a church in there, right, and everyone is an opensource believer and, this kind of invisible hand of capitalism (laughs) reached in and wrote on the wall and, you know, having written and left. But at the end of the day, right, somebody's got to pay for babies new shoes. I think that it was also very interesting seeing, at Red Hat Summit, which I covered on theCUBE, Red Hat's argument was fairly philosophical, and from first principles. Containers are Linux, therefore Red Hat, and that was logically laid out. Mark's, actually I loved Mark's, most of his speech, which was very practical, this, you know, Ubuntu's going to make both OpenStack and containers simpler, faster, quicker, and cheaper, so it was clearly benefits, and then, for the folks that don't know, then he put up a couple a crazy Eddy slides like, limited time offer, if you're here at the show, here's a deal that we've put together for ya, so that was a little bit unusual for a keynote. >> Yeah, and there are a lot of users here, and some of them'll hear that and they'll say: yeah, you know, I've used Red Hat there but, you can save me money that's awesome, let me find out some more about it. Alright, so, we've got three days of coverage here John, and we get to cover this really kind of broad ecosystem that we have here. You talked about what we don't discuss anymore, like the major lease was Queens, and it used to be, that was where I would study up and be like oh okay, we've got Hudson, and then we got, it was the letters of the alphabet, what's the next one going to be and what are the major features it's reached a certain maturity level that we're not talking the release anymore, it's more like the discussions we have in cloud, which is sometimes, here's some of the major things, and oh yeah, it just kind of wraps itself in. Deployments still, probably aren't nearly as easy as we'd like, Shuttleworth said two guys in under two weeks, that's awesome, but there's solutions we can put, stand up much faster than that now, two weeks is way better than some of the historical things we've done, but it changes quite a bit. So, telecommunications still a hot topic, Edge is something, you know what I think back, it was like, oh, all those NFE conversations we've had here, it's not just the SDN changes that are happening, but this is the Edge discussion for the Telcos, and something people were getting their arms around, so. >> It's pretty interesting to think of the cloud out on telephone poles, and in branch offices, in data centers, in closets basically or under desks almost. >> No self-driving cars on the keynote stage though? >> No, nothing that flashy this year. >> No, definitely not too flashy so, the foundation itself, it's interesting, we've heard rumors that maybe the show will change name, the foundation will not change names. So I want to give you last things, what're you looking for this week, what were you hearing from the community leading up to the show that you want to validate or poke at? >> Well, I'm going to look at real deployments, I'd like to see how standard we are, if we are, if an OpenStack deployment is standardized enough that the pool of talent is growing, and that if I hire people from outside my company who work with OpenStack, I know that they can work with my OpenStack, I think that's key for the continuation of this ecosystem. I want to look at the general energy and how people are deploying it, whether it does become really invisible and boring, but still important. Or do you end up running OpenShift on bare metal, which I, as an infrastructure person, I just can't see that the app platform should have to worry about all this infrastructure stuff, 'cause it's complicated, and so, I'll just be looking for the healthy productions and production deployments and see how that goes. >> Yeah, and I love, one of the things that they started many years ago was they have a super-user category, where they give an award, and I'm excited, we have actually have the Ontario Institute for Cancer Research is one of our guests on today, they won the 2018 super-user group, it's always awesome when you see, not only it's like, okay, CERN's here, and they're doing some really cool things looking for the Higgs boson, and all those kind of things but, you know, companies that are using technology to help them attack the battle against cancer, so, you know, you can't beat things like that. We've got the person from the keynote, Melvin, who was up on stage talking about the open lab, you know, community, ecosystem, definitely something that resonates, I know, one of the reasons I pulled you into this show in the last year is you're got a strong background there. >> Super impressed by all the community activity, this still feels like a real community, lots of pictures of people, lots of real, exhortations from stage to like, we who have been here for years know each other, please come meet us, so that's a real sign of also, a healthy community dynamic. >> Alright, so John first of all, I want to say, Happy Victoria Day, 'cause we are here in Vancouver, and we've got a lot going on here, it's a beautiful venue, hope you all join us for all of the coverage here, and I have to give a big shout out to the companies that allowed this to happen, we are independent media, but we can't survive without the funding of our sponsors so, first of all the OpenStack Foundation, helps get us here, and gives us this lovely location overlooking outside, but if it wasn't for the likes of our headline sponsor Red Hat as well as Canonical, Kontron, and Nuage Networks, we would not be able to bring you this content so, be sure to checkout thecube.net for all the coverage, for John Troyer, I'm Stu Miniman, thanks so much for watching theCUBE. 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>> Narrator: From Austin, Texas, it's theCUBE covering DockerCon 2017, brought to you by Docker and support from it's ecosystem partners. (upbeat music) >> Hi, and we're back, I'm Stu Miniman, and this is SilconANGLES production of the Cube, here at DockerCon 2017, Austin, Texas. Happy to have on the program Kiran Kamity, who was CEO of ContainerX which was acquired by Cisco. And you're currently the senior director and head of container products at Cisco. And also joining us is Brad Wong, who is the director of product management at Docker. Gentlemen, thank you so much for joining us. >> Brad: Thanks for having us. [Kiran] Thank you, Stu. >> So Kiran, talk a little bit about ContainerX, you know, bring us back to, why containers, you know why you help start a company with containers, and when to be acquired by a big company like Cisco. >> Yeah, it was actually late 2014 is when Pradeep and I, my co-founder from ContainerX, we started brainstorming about, you know, what do we do in the space and the fact that the space was growing, and my previous company called RingCube, which has sold to Citrix, where we had actually built a container between 2006 and 2010. So we wanted to build a management platform for containers, and it was in a way there was little bit of an overlap with Docker Datacenter, but we were focusing on mostly tendency aspects of it. Bringing in concepts like viamordi rs into containers et cetera. And we were acquired by Cisco about eight months ago now, and the transition in the last eight months has been fantastic. >> Great, and Brad, you're first time on the cube, so give us your background, what brought you to Docker? >> Yeah, so actually before Docker I was at actually, a veteran of Cisco, interestingly enough. Many different ventures in Cisco, most recently I was actually part of the Insieme Networks team, focusing on the software defined networking, and Application Centric Infrastructure. Obviously I saw a pretty trend in the infrastructure space, that the future of infrastructure is being led by applications and developers. With that I actually got to start digging around with Docker quite a lot, found some good interest, and we started talking, and essentially that's how I ended up at Docker, to look at our partner ecosystem, how we can evolve that. Two years ago now, actually. >> I think two years ago Docker networking was a big discussion point. Cisco's been a partner there, but bring us up to speed if you would, both of you, on where you're engaging, on the engineering side, customer side, and the breadth and depth of what you're doing. >> You're right, two years ago, networking was in quite a different place. We kicked it off with acquiring a company back then called SocketPlane, which helped us really define-- >> Yeah and we know actually, ---- and ----, two alums, actually I know those guys, from the idea to starting the company, to doing acquisition was pretty quick for you and for them. >> Right, and we felt that we really needed to bring on board a good solid networking DNA into the company. We did that, and they helped us define what a successful model would be for networking which is why they came up with things like the container networking model, and live network, which then actually opened the door for our partners to then start creating extensions to that, and be able to ride on top of that to offer more advanced networking technologies like Contiv for example. >> Contiv was actually an open source project that was started within Cisco, even before the container was acquisitioned. Right after the acquisition happened, that team got blended into our team and we realized that there were some really crown jewels in Contiv that we wanted to productize. We've been working with Docker for the last six months now trying to productize that, and we went from alpha to beta to g a. Now Contiv is g a today, and it was announced in a blog post today, and it's actually 100% open-source networking product that Cisco TAC and Cisco advanced services have offered commercial support and services support. It's actually a unique moment, because this is the fist 100% open-source project that Cisco TAC has actually offered commercial support for, so it's a pretty interesting milestone I think. >> I think also with that, we also have it available on Docker store as well. It's actually the first Docker networking plug-in that it's been certified as well. We're pretty also happy to have that on there as well. >> Yeah. >> Anything else for the relationship we want to go in beyond those pieces? >> We also saw that there was a lot of other great synergies between the two companies as well. The first thing we wanted to do was to look at how we can also make it a lot better experience for joint customers to get Docker up and running, Docker Enterprise Edition up and running on infrastructure, specifically on Cisco infrastructure, so Cisco UCS. So we also kicked off a series of activities to test and validate and document how Docker Enterprise Edition can run on Cisco UCS, Nexus platforms, et cetera. We went ahead with that and a couple months later we brought out, jointly, to our Cisco validated designs for Docker Enterprise Edition. One on Cisco UCS infrastructure alone, and the other one jointly with NetApp as well, with the FlexPod Solution. So we're also very very happy with that as well. >> Great. Our community I'm sure knows the CVD's from what they are out there. UCS was originally designed to be the infrastructure for virtualized environments. Can you walk me through, what other significant differences there or anything kind of changing to move to containers versus what UCS for virtualized environment. >> The goal with that, UCS is esentially considered a premium kind of infrastructure server infrastructure for our customers. Not only can they run virtual environments today, but our goal is as containers become mainstreamed, containers evolved to being a first-class citizen alongside VM. We have to provide our customers with a solution that they need. And a turnkey solution from a Cisco standpoint is to take something like a Docker stack, or other stacks that our customer stopped, such as Kubernetes or other stacks as well, and offer them turnkey kind of experience. So with Docker Data Center what we have done is the CVD that we've announced so far has Docker Data Center, and the recipe provides an easy way for customers to get started with USC on Docker Data Center so that they get that turnkey experience. And with the MTA program that was announced, today at the key note. So that allows Cisco and Docker to work even more closely together to have not just the products, but also provide services to ensure that customers can completely sort of get started very very easily with support from advanced services and things like that. >> Great, I'm wondering if you have any customer examples that you can talk through. If you can't talk about a specific, logo, maybe you can talk about. Or if there are key verticals that you see that you're engaging first, or what can you share? >> We've been working joint customer evals, actually a couple of them. Once again I don't think we can point out the names yet. We haven't fully disclosed, or cleared it with their Prs Definitely into financials. Especially the online financials, a significant company that we've been working with jointly that has actually adopted both Contiv, and is actually seeing quite a lot of value in being able to take Docker, and also leverage the networking stack that Contiv provides. And be able to not just orchestrate networking policies for containers, but the other thing that they want to do is to have those same policies be able to run on cloud infrastructure, like EWS for example. So they obviously see that Docker is a great platform to be enable their affordability between on premises and also public cloud. But at the same time be able to leverage these kind of tools that makes that transition, and makes that move a lot easier so they don't have to re-think their security networking policies all over again. That's been actually a pretty used case I thought of the joint work that we did together with Contiv. >> Some of the customers that we've been talking to in fact we have one customer that I don't think I'm supposed say the name just yet, but we've drollled it out, has drolled out Contiv with the Docker on time. In five production data centers already. And these are the kind of customers that actually take to advanced networking capabilites that Contiv offers so that they can comprehensive L2 networking, L3 networking. Their monitoring pools that they currently use will be able to address the containers, because the L2, the L3 networking capabilities allows each container to have an IP address that is externally addressable, so that the current monitoring tools that you use for VMs et cetera can completely stay relevant, and be applicable in the container world. If you have an ACI fabric that continues to work with containers. So those are some of the reasons why these customers seem to like it. >> Kiran, you're relatively new into Cisco, and you were a software company. Many people they still think of Cisco as a networking company. I've heard people derogatory it's like, "Oh they made hardware define networking when they rolled out some of this stuff." Tell us about, you talk about an open source project that you guys are doing. I've talked to Lou Tucker a number of times. I know some of the software things you guys are doing. Give us your viewpoint as to your new employer, and how they might be different than people think of as the Cisco that we've known for decades. >> Cisco is, has of course it has, you know, several billion dollars of revenue coming in from hardware and infrastructure. And networking and security have been the bread and the butter for the company for many many years now But as the world moves to Cloud-Native becoming a first class citizen, the goal is really to provide complete solutions to our customers. And if you think of complete solutions, those solutions include things like networking, thing like security. Including analytics, and complete management platforms. At the same time, at the end of the day, the customers want to come to peace with the fact that this is a multi-cloud world Customers have data centers on premises, or on hosted private cloud environments. They have workloads that are running on public clouds. So with products like cloud center, our goal is to make sure that whatever they, the applications that they have, can be orchestrated across these multiple clouds. We want to make sure that the pain points the customers have around deploying whole solutions include easy set-up of products on infrastructure that they have, and that includes partnerships like UCS, or running on ACI or Nexus. We want to make sure that we give that turnkey experience to these customers. We want to make sure that those workloads can be moved across and run across these different clouds. That's where products like cloud center come in. We want to make sure that these customers have top grade analytics, which is completely software. That's were the app dynamics acquisition comes in. And we want to make sure that we provide that turnkey experience with support in terms of services. With our massive services organization, partners, et cetera. We view this as our job is to provide our customers what they need in terms of the end solution that they're looking for. And so it's not just hardware, it's just a part of it. Software, services, et cetera, complimented. >> Alright, Brad last question that I have for you in the keynote yesterday, I couldn't count how many times the word ecosystem was used. I think it was loud and clear that everybody there I think it was like, you know, Docker will not be successful unless it's partners are successful, kind of vice versa. When you look at kind of the product development piece of things, how does that resonate with you and the job that you're doing? >> We basically are seeing Docker become more of a, more and more of a platform as evidenced by yesterdays keynote. Every platform, the only way that platform's going to be successful is if we can do great, we have great options for our partners, like Cisco, to be able to integrate with us on multiple different levels, not just on one place. The networking plug-in is just one example. Many many other places as well Yesterday we announced two new open source initiatives. Lennox kit and also the movi project. You can imagine that there's probably lots of great places where partners like Cisco can actually play in there, not just only in the service fees, but maybe also in things like IOT as well, which is also a fast-emerging place for us to be. And all the way up until day two type of monitoring, type of environment as well where we think there's a lot of great places where once again, options like app dynamics, tetration analytics can fit in quite nicely with how do you take applications that have been migrated or modernized into containers, and start really tracking those using a common tool set. So we think that's really really good opportunities for our ecosystem partners to really innovate in those spaces, and to differentiate as well. >> Kiran, I want to give you the final word, take-aways that you want the users here, and those out watching the show to know about, you know, Cisco, and the Docker environment. >> I want to let everybody know that Cisco is not just hardware. Our goal is to provide turnkey complete solutions and experiences to our customers. And as they walk through this journey of embracing Cloud-Native workloads, and containerized workload there's various parts of the problem, that include all the way from hardware, to running analytics, to networking, to security, and services help, and Cisco as a company is here to offer that help, and make sure that the customers can walk away with turnkey solutions and experiences. >> Kiran and Brad, thank you so much for joining us. We'll be back with more coverage here. Day two, DockerCon 2017, you're watching theCube.

>> Narrator: Live from Santa Clara, California it's theCUBE. Covering Open Networking Summit 2017. Brought to you by the Linux Foundation. >> Hey welcome back everybody, Jeff Frick here with theCUBE. We're in Santa Clara at the Open Networking Summit 2017. We haven't been here for a couple years. Obviously Open is everywhere. It's in hardware, it's in compute, it's in store, and it's certainly in networking as well. And we're excited to be joined first off by Scott Raynovich who will be co-hosting for the next couple of days. Good to see you again Scott. >> Good to see you. >> And our next guest is Ihab Tarazi. He's the EVP and CTO of Equinix. Last time we saw Ihab was at Open Compute Project last year, so great to see you again. >> Yeah, thank you very much, good to be here. I really enjoyed the interview last year so thanks for having me again. >> Now you set it at the high bar, so hopefully we can pull it off again. >> We can do it. >> So first off for folks that aren't familiar with Equinix, give them kind of an overview. Because you don't have quite the profile of Amazon and Google and the other cloud providers, but you're a pretty important piece of the infrastructure. >> Ihab: Yeah absolutely. While we're nowhere close to the size of those players, the place we play in the universe is very significant. We are the edge of the cloud, I would say. We enable all these players, they're all our biggest customers. As well all the networks are our biggest customers. We have over 2,000 clouds in our data centers and over 1,400 networks. We have one of the largest global data center networks. We have 150 data centers and four eMarkets around the world. And that number is going to get a little bigger. Now we announce the acquisition of Verizon data center assets. So we'll have more data centers and a few more markets. >> I heard about the Verizon acquisition, so congratulations, just adding more infrastructure. But let's unpack it a little bit. Two things I want to dig into. One is you said you have clouds in your data centers. So what do you mean by that? >> Yeah the way the cloud architecture is deployed is that the big cloud providers will have these big data centers where they build them themselves and it hosts the applications. And then they work with an edge for the cloud. Either a caching edge or compute edge, or even a network edge in data centers like ours where they connect to all their enterprise customers and all the networks. So we have a significant number of edges, we have 21 markets around the world. We have just about the big list of names, edges, that you can connect to automatically. From AWS, Google, Microsoft, Salesforce.com, Oracle, anybody else you think of. >> So this is kind of an extension of what we heard back a long time ago with you guys and like Amazon specifically on this direct connect. So you are the edge between somebody else's data center and these giant cloud providers. >> Absolutely. And since the last time we talked, we've added a lot more density. More edge nodes and more markets and more new cloud providers. Everywhere from the assess to the infrastructure as a service provider. >> And why should customers care? What's the benefit to your customers for that? >> Yeah the benefit is really significant. These guys want direct access to the cloud for high performance and security. So everybody wants to build the hybrid cloud. Now it's very clear the hybrid cloud is the architecture of choice. You want to build a hybrid cloud, then you want to deploy in a data center and connect to the cloud. And the second thing that's happening, nobody's using just one cloud. Everybody's doing a multi-cloud. So if you want 40, 50 clouds like most companies do, most CIOs, then you're going to want to be in a data center that has as many as possible. If you're going to go global, connect to multi-cloud and have that proximity, you're going to have a hard time finding somebody like Equinix out there. >> Yeah but I've got a question. You mentioned the Verizon deal. There was a trend for a while where all these big service providers were buying data centers, including AT&T, CenturyLink, and now the trend appears to have reversed. Now they're selling the data centers that they bought. I'd love your insight on that. Why that just wasn't their core competency? Why are the selling them back to people like Equinix. >> Yeah that's a good question. What's happened over time as the cloud materialized, is the data canters are much more valuable if they're neutral. If you can come in and connect to all the clouds and all the networks, customers are much more likely to come in. And therefore if a data center is owned by a single network, customers are not as likely to want to use it because they want to use all the networks and all the clouds. And our model of neutrality and how we set up exchanges, and how we provide interconnection, and the whole way we do customer service, is the kind of things people are looking for. >> So you're the Switzerland of the cloud. >> And so the same assets become much more valuable in this new model. >> And I don't know if people understand quite how much direct connection and peer-to-peer, and how much of that's going on, especially in a business-to-business context to provide a much better experience. Versus you know the wild wooly internet of days of old where you're hopping all over the place, Lord knows how many hops you're taking. A lot of that's really been locked down. >> I think the most important step people can think about is by 2020 90% of all the internet, or at least 80 to 90, will be home to the top 10 clouds. Therefore the days of the wild internet, while that continues to be significant, the cloud access and interconnection is very critical, and continues to be even bigger. >> Go ahead. >> So tell us what the logistics are of managing the growth, like you opening how many data centers a year, and how much equipment are you moving into these data centers. We spend over a billion dollars a year on upgrading, adding capacity, and building new data centers. We usually announce five, six, new ones a year. We usually have 20 plus projects, if not more, active at any time. So we have a very focused process and people across the globe manage this thing. We don't want to go dark in any of our key matters like Washington DC, the D.C. market, or let's say the San Jose, Silicon Valley, etc. Because customers want to come in and continue to add and continue to bring people. And that means not only expanding the existing data centers, but buying land and building more data centers beside it, and continue to expand where we need to. And then every year or so we go into one or two more emerging markets. We went into Dubai a while ago and we continue to develop it. And those become long term investments to continue to build our global infrastructure. The last few years we've made massive acquisitions between Telecity in Europe, Bit-isle in Japan, and now the Verizon assents that expanded our footprint significantly into new markets, Eastern Europe, give us bigger markets in places like Tokyo which helped us get to where we are today. >> One of the themes in networking and cloud in general is that the speed of light is just too damn slow. At the end of the day, stuff's got to travel and it actually takes longer than you would think. So does having all these, increased presence, increased egos, increased physical locations, help you address some of that? Because you've got so many more points kind of into this private network if you will. >> Oh yeah absolutely. The content has become more and more localized by market. And the more you have things like IOT and devices pulling in more data, not all the data needs to go all over the globe. And also there is now jurisdiction and laws that require some of the content to stay. So the market approach that we have is becoming the center of mass for where the data resides. And once the data gets into our data center, the value of the data is how you exchange it with other pieces of information, and increasingly how you make immediate decisions on it, you know with automation and machine learning. So when you go to that environment you need massive capacity, very low latency, to many data warehouses or data lakes, and you want to connect that to the software that can make decisions. So that's how we see the world is evolving now. One thing we see though is that complementing that will be a new edge that will form. A lot of people in this conference were talking about that. A lot of the discussion about the open networks here is how we support the 5G, all the explosion of devices, and what we see that connecting to that dense market approach that we have where the data is housed. >> That's interesting you just mentioned all the devices which was going to be my next question. So the internet of things, how will this change the data center edge, as you refer to it? >> Yeah that's the biggest question in the industry, especially for networks. And the same discussion happened at Mobile Work Congress here a little while ago. People now believe that there'll be this compute edge, that the network will be a compute edge. Because you want to be able to put compute, keep pushing it out all the way to the edge. And that edge needs to support today's technologies but also all the open wireless spectrum, all the low powered networks, open R which is one of the frequencies for the millimeter frequencies, and also the 5G as you know. So when you add all that up you're going to need this edge to support. So all the different wireless options plus some amount of compute, and that problem is very hard to solve without an open source model, which is where a lot of people are here looking for solutions. >> It's interesting because your definition of the edge feels like it's kind of closer to the cloud where's there's a lot of converstion, we do a lot of stuff with GE about the edge, which is you know right out there on the device and the sensor. Because as you said depending on the application, depending on the optimization, depending on what you're trying to do, the device is some level of compute and store that's going to be done locally, and some of it will go upstream and get processed and come downstream. But you're talking about a different edge. Or you know of see you guys extending all the way down to that edge. >> We don't see ourselves extending at this time but definitely it's something we're spending a lot of time analyzing to see what happens. I would say a couple of big stats is that today our edge is maybe 100 milliseconds from devices in a market or a lot less in some cases. The new technology will make that even shorter. So with the new technology like you said, you can't beat the speed of light, but with more direct connections you'll get to 40, 50 milliseconds, which is fantastic for the vast majority of applications people want. There'll be very few applications that need much slower latency all the way down to the sub-10 millisecond. For those somebody like a network would need to put compute at the edge to do some of it. So that world of both types will continue. But even the ones that need the very low latency, for some of the data it still needs to compare it to other sources of data and connect to clouds and networks but some of the data will still come back to our data centers. So I think this is how we see the world evolving but it's early days and a lot of brain power will be spent on that. >> So as you look forward to 2017, what are some of the big items on your plate that you're trying to take down for this calendar year? >> The biggest thing I want on our list is that we have an explosion of software model. Everybody who was a software now has a software platform. When we were at OCP for example you saw NetApp, they showed their software as an open source. Every single company from security to storage, even networking, are now creating their platform available as a software. Well those platforms have no place to go today. They have no deployment model. So one of the things we are working on is how we create a deployment model for this as a service model. And most of them is open source, so it needs decoupling of software and hardware. So we are really actively working with all these to create an open source software and just software in general, ecosystem plus this whole open source hardware. >> So do you guys have a pretty aggressive software division inside Equinix, especially in these open source projects? Or how do you kind of interact with them? >> Our model is to enable the industry. So we have some of our tools but mostly for enabling customers and customer service, as well as some of the basic interconnection we do. The vast majority of all the stuff is our partners, and these are our customers. So our model is to enable them and to connect them to everybody else they need at ecosystem to succeed and help them set up as a service model. And as the enterprise customers come to our data center, how to they connect to them. So I would say that's one of the most sought after missions when we go to conferences like this. Everybody who announced today is talking to us about how they enable the announcements they make and given our place in the universe, we would be a very key player in enabling that ecosystem. >> Do you have like a special lab where you test these new technologies? Or how do you do that? >> Yeah that's the plan. And we connect this effort to also what we're doing with OCP and Telecom Infrastructure Project where we have a leadership position and highly engaged. We are creating a lab environment where people can come in and test not only the hardware from TIP and OCP, but also the software from open network, but many other open source software in general under the Linux Foundation or others. In our situation not only can they test it against each other, but they can test the performance against the entire world. How does this work with the internet, the cloud? And that leading us to deployment and go to market models that people are looking for. >> Alright sounds pretty exciting. Equinix, a company that probably handles more of your internet traffic than you ever thought. >> Ihab: That's very true. >> Well thanks again for stopping by. We'll look for you at our next open source show. >> Thank you very much. >> Ihab Tarazi from Equinix. He's Scott Raynovich, I'm Jeff Frick, you're watching theCube from Open Networking Summit 2017, see you next time after this short break. (techno music)

(intel sound logo) >> [Announcer] Live from Silicon Valley, it's the CUBE. Covering Mobile World Congress 2017, brought to you by INTEL. >> Okay welcome back everyone to our special two days of coverage of Mobile World Congress 2017. I'm John Furrier, here in the Palo Alo Studios covering what's happening in Mobile World Congress in Barcelona, Spain. Of course this is our day two of wall to wall coverage. Eight a.m. to six p.m. for two days and of course, as we kick off our day two and get early morning here in California or mid morning, they're ending the day in Barcelona and all the news is dropping. Again, it's continuing the theme of 5G, IoT and the notion of the super demos, all the flare and glam around IoT, AI and everything else. On the phone right now in Barcelona, Spain, is our friend and analyst with the Futuriom Group, Scott Raynovich, who will also be co-hosting with the CUBE at ONS, Open Networking Summit. Longtime industry analyst, guru in the space around mobile, certainly SDN and what's going on. Scott, welcome and thanks for taking the time to call in from Barcelona. >> [Scott] Thanks, John. Great to be here, and also I might add some color to one thing you said, when you said the day was winding down. (John laughs) Apparently in Barcelona the day never ends. It just goes all the way through. >> Well the show is ending but now the real action happens, all the hallway conversations at dinner and certainly we know that you take a nap around this time and go out and get ready to burn the midnight oil 'til three in the morning. We have many stories of Barcelona, but let's get down to it. What's happened today in Barcelona? What's the big story? What are you seeing on the ground there? What's the vibe? Give us some insight into what's happening, the experiences you're having and what's the big stories today coming out of Mobile World Congress. >> [Scott] Yeah sure, John. Well there's, as you know, there's a lot of hype about a lot of buzz words, so you got to throw all the buzz words out there: IoT, 5g, self driving cars, VR, AR, augmented reality. If you run through the halls you see a lot of those gizmos and gadgets and I would say the scene has shifted a lot in recent years. As you know a couple years ago it was all about Samsung's big tablet or the latest phone and now it's more about these kind of more advanced technologies, they call them interactive technologies that we're going to see coming down the road the next few years, so there's lots of stuff. >> The show has been very telco orientated and still really is a device and telco show basically. The device guys had their moment in the sun on Saturday and Sunday, but Monday kicked off really the telco show. This is really about ... The telco is trying to figure out their future. Their core competency over the years has been how to provision subscribers and billing, and been trying to figure out the over the top, and now as you look at the software that's coming out with the 5g plus the end to end, some of the things happening at the network transformation area. There's some real action happening. I want to just get your thoughts on is this the time where we're starting to see the needle move on the progress of really bringing the kind of networks that are going to power the cool technologies and promises of use cases, whether it's e-sports up to driving cars that are essentially data centers. Huge amount of data problems, huge amount of network reconfiguration, is this the time where there is an inflection point? What's your thoughts? >> [Scott] Yeah, that's a great point. You have the service providers for a number of years have felt a little bit - I don't know what the word is - spurned by success. They created all this plumbing and they put this massive investment into LTE, broadband, that really enabled all these applications, but it was more people like Apple and Netflix and Amazon that kind of stole the show by leveraging that bandwidth for these new services. Cloud services, music services, of course Netflix, the most popular internet service in the world, and so the service providers kind of feel like 5G is another opportunity that they don't want to squander and so they're being very careful about how to position that. But to your point, they have realized that they absolutely need to virtualize their network because what's going to addle a 5G is you have this massive amount of bandwidth but you need to splice it up into different - they called them actually network slices - so that you can provide all these advanced services, and that's where the service providers want to figure out how they're going to monetize that. So it's certainly a launchpad for the technology and the somewhat maligned technology known as NFV, Network Function Virtualization, but I think that the pressure to get 5G out is going to accelerate their investment in NFV because they need that cloud platform to kind of serve up all these next generation services. >> Is the telco's NFV efforts going to make them more cloud ready in your mind? Is that the sentiment? Is it that, do they have to kind of do a lot of things right now? And the question is, what are the use cases if they are cloud ready and if they can get their act together, the network layer to power these aps that are going to be running on 5G, so you know? >> [Scott] Yeah, yeah. I think so, I mean they're progressing. AT&T makes periodic announcements that they've virtualized whatever it is, 30 or 40 percent of the network, and Verizon has a pretty interesting company Radisys, which recently got a 70 million dollar contract from Verizon to install NFV infrastructure. Now that's not ... 70 million dollars is a drop in the bucket in terms of capital spending for a small virtualization platform like Radisys, but that's a pretty big move and so I think you're seeing this stuff finally becoming real, and they are going to have, within a few ... We'll wait for them because they're a much more flexible platform. It's based on the cloud web scale model, where you snap in a bunch of servers and all the networking is virtualized and you can move things around in the cloud and they want to take advantage of new services they can offer, whether that's a virtualized enterprise security service, you know security service in the cloud where you go into the Verizon Data Center and you order it up and you have a cloud security model that it will protect you, or other what we call Virtual Network Functions, another hot area you've probably heard of SD-WAN. There are a lot of SD-WAN services being rolled out >> Cool >> and that's a virtualized WAN solution that doesn't require you to, say you have a bunch of branch offices around the world, you don't have to ship them all routers and then hook them up with expensive leased lines. You can kind of close them in with the cloud if you will, and there are a bunch of hot companies in that area, including Aryaka Networks, Velo Cloud, Viptela, which are all mentioned as active acquisition targets these days, so there's definitely still a lot of virtualization thought going on but I will say it took a backseat to, this year it took a backseat to 5g and IoT. >> Yeah great commentary. I got to say, I talked with Intel with an exclusive interview with Sandra Rivera from Intel GM, with Communications Network Platforms Group, and we were talking about the dynamics and I think the big IoT thing has been autonomous vehicles. Obviously smart cities is, you've got some surveillance, you've got cameras and stuff in towns and cities, and certainly the smart home. You can't move an inch in the industry without hearing about echo and google in the home, kind of voice activated automation. Then you've got media entertainment, you mentioned Netflix. You know all these things are essentially coming back to rear its data center environment. This is like the data center meets consumer, and we were commenting that the autonomous vehicle is essentially a data center on wheels and that there's going to be trade offs between low latency high bandwidth and true mobility. You know car is not going to be dictated by millimeter wave technology because they might have different frequencies, so this brings up this diversity of network. And so I'll get your thoughts on how you see the market evolving with the pressure for open source software, you mentioned SD WAN it's software defined, WAN software defined radio, software defined networks, software defined data center, the whole world is software defined so the role of open standards both on open source software as well as open wireless if you will, meaning not one vendor is going to own it, how do you grok that? How do you pull that picture together and how do you advise your clients on what this actually means for them and their impact? >> [Scott] Yeah that's a great question. Well, you kind of hit the nail on the head with the question, because I spent much of the show looking at all of the ... If you want to break it up into two buckets of things here, you talked about cloud and WAN, so the infrastructure that builds the data center but as you pointed out, this is a service provider show, so a lot of the discussion is around connectivity standards of course, and it's really amazing John. It's amazing. You know we can boil these things down into these neat little buzz words >> IoT and 5G - but just today, I talked to people about at least five different forms of IoT standards and of course 5G today was a super controversial topic. So let me just break those off one by one. With IoT connectivity, you have something called LoRaWAN, which is a open standard, an IoT open standard, and there's about 500 members signed onto the LoRaWAN alliance, including Cisco and IBM and China Electric, so that has a fair amount of momentum. It has certain characteristics. Very low bandwidth, and not in real time so it's, I'll just give you one example. If you want a connected cow, John, I saw a connected cow, and the idea is that is be large. When a massive operation wanted, you want to track your livestock, so you need a very low cost device that does that. That's an example. You also have so called MBIOT, which Cisco's pushing pretty hard narrow band IoT, with another standard that's going to be used for IoT applications. You have the 3GPP working on LPWAN, which is kind of like a 2G recycled for IoT. The characteristics of IoT have to be really cheap there has to be really low power, so you can't use LTE right? So that's another one. Then you have a couple of hot private companies. SigFox, which has over 100 million dollars funding, and it might even be hundreds of millions of dollars at this point, based in France. Another company called Ingenu, which is spun out of east San Diego qualcon hotbed with a lot of really interesting IT and they have a technology called RPMA, so those two companies are building networks worldwide based on proprietary standards. They've said, "We're going to build an IoT network, "a radio network for IoT all over the world, "and it's going to be based on our proprietary technology, "'cuz it works better," so that ... I just gave you IoT, right? Okay, and then you have 5G, which dozens of service providers (incoming call beep) all have different things about that and actually argued about 5G doesn't exist right? Right so you have Verizon rolling out a pretty standard 5G trial and then you have something called 5GNR, New Radio, which is a multi spectrum flavor of 5G that Qualcomm and are fooling around with, and then you have people like Nokia saying, "Woah, woah, woah slow down. We can't push 5G "before its time. We don't want it to fragment, you know? (vibrating phone) "We don't want it to just "splinter all over the place," >> Yeah. >> [Scott] You know, pull like an Android. So I don't know, that was a mouthful but if you- >> So what does it mean? Is it ... >> You get the idea of how these buzzwords, when you unpack them, they get really complicated. >> Is it forking? Is 5G essentially a land grab right now, or is this all part of the evolution in your mind, because it does seem that you need a catalyst. Obviously Intel's taking a leadership position. They've done a deal with Nokia. You've seen some Ericcson announcement but then you've got Qualcomm on the other side with Snapdragon and you know the competition between Intel and Qualcomm is at an all time high, certainly on the handset side. But at the end of the day, the network is the key at this point, and so the question is, is 5G going to be broken down by the forking? >> 5G is a hype grab, it's totally a grab. >> It's a hype grab. (laughs) >> [Scott] Because 5G will not exist for at least ... They won't be rolling it out 'til 2020 and I heard several people argue today that it's really 2021, so it's not a land grab until it actually exists, right? So it's all about positioning your marketing around it, but just to give you an example of one of the controversies today was accelerating. Should we accelerate to 5G? You know and then BT came out and said, "Well we have to be careful because it's really expensive." 5G is actually going to be more expensive than LTE. If you don't have the return on investment, you know you're going to kill yourself, so people are confused. >> Scott, Intel claims they're going to have 5G in Winter Olympics in Korea. That is what they told me on the record. Not sure if that is a trial network or is that going to be just some data stations? >> [Scott] Yeah they'll have some form of 5G. I mean what I'm trying to point out with all these things is when somebody says the buzz word, it doesn't mean one thing, right? >> Yeah. >> [Scott] It means like yeah, it means several things. And it'll certainly be pretty standard 5G trials. I'm just saying right now we don't even know what that is. Nobody has even settled on what the spectrum is for 5G. There's like been four different announcements about different spectrums and then you have this 5GNR thing which is a multi spectrum technology, so it's really hard to say. I'd be shocked if anybody at Intel definitively knows what 5G looks like at this point. >> Well certainly it begs a question for a follow up conversation around what is 5G. Certainly people will argue what that means in terms of bandwidth, but the question we had on The CUBE yesterday was, "What aps are even ready for a gigabyte "and what does that mean?" Is that fixed wire, is that true mobility, is that latency versus bandwidth, and et cetera et cetera. You know the debate will rage on. Honestly I just want to see more bandwidth. I love connectivity so. Alright Scott, thanks so much for taking the time. I got to ask you a final question. You know, what's the best party so far in Barcelona? What's the best tapas you've had? What's the scene like in and around town? What's some of the buzz? >> [Scott] (laughing) Well I haven't been to any big parties to tell you the truth, I've mostly been to private dinners. The food is amazing and so is the wine. >> Yeah. >> [Scott] It's pretty hard to go wrong in Barcelona. It's probably like a foodie's paradise I would say. >> Yeah it certainly is. When we were there last time it was amazing. Great gothic vibe there, great little restaurants. Scott Raynovich here inside the CUBE and Scott you got some new credentials here. You're still at rayno on twitter but you now have a new firm called Futuriom - F-u-t-u-r-i-o-m Research. Congratulations. >> [Scott] Futuriom, yep. >> Futuriom. So appreciate it and thanks for taking the time, want to give you a shout out for the new gig and you'll be hosting for the CUBE at the Open Networking Summit, ONS, coming up. Appreciate that and thanks for calling in and sharing the insight, what's happening in Spain and Barcelona for Mobile World Congress. Thanks so much. >> [Scott] Thanks, John. It was geat. Thanks for having, that was great stuff. >> Great. We'll be back with more after this short break. This is special two days coverage inside the Studios of Palo Alto live, here in California, breaking down what's happening in Barcelona with all the news, the analysis.