(upbeat instrumental music) >> TheCUBE's live coverage is made possible by funding from Dell Technologies, creating technologies that drive human progress. (uplifting instrumental music) >> Hey everyone. Welcome to Barcelona, Spain. It's theCUBE Live at MWC '23. I'm Lisa Martin, Dave Vellante, our co-founder, our co-CEO of theCUBE, you know him, you love him. He's here as my co-host. Dave, we have a great couple of guests here to break down day one keynote. Lots of meat. I can't wait to be part of this conversation. Chris Lewis joins us, the founder and MD of Lewis Insight. And Sarbjeet Johal, one of you know him as well. He's a Cube contributor, cloud architect. Guys, welcome to the program. Thank you so much for joining Dave and me today. >> Lovely to be here. >> Thank you. >> Chris, I want to start with you. You have covered all aspects of global telecoms industries over 30 years working as an analyst. Talk about the evolution of the telecom industry that you've witnessed, and what were some of the things you heard in the keynote that excite you about the direction it's going? >> Well, as ever, MWC, there's no lack of glitz and glamour, but it's the underlying issues of the industry that are really at stake here. There's not a lot of new revenue coming into the telecom providers, but there's a lot of adjustment, readjustment of the underlying operational environment. And also, really importantly, what came out of the keynotes is the willingness and the necessity to really engage with the API community, with the developer community, people who traditionally, telecoms would never have even touched. So they're sorting out their own house, they're cleaning their own stables, getting the cost base down, but they're also now realizing they've got to engage with all the other parties. There's a lot of cloud providers here, there's a lot of other people from outside so they're realizing they cannot do it all themselves. It's quite a tough lesson for a very conservative, inward looking industry, right? So should we be spending all this money and all this glitz and glamour of MWC and all be here, or should would be out there really building for the future and making sure the services are right for yours and my needs in a business and personal lives? So a lot of new changes, a lot of realization of what's going on outside, but underlying it, we've just got to get this right this time. >> And it feels like that monetization is front and center. You mentioned developers, we've got to work with developers, but I'm hearing the latest keynote from the Ericsson CEOs, we're going to monetize through those APIs, we're going to charge the developers. I mean, first of all, Chris, am I getting that right? And Sarbjeet, as somebody who's close to the developer community, is that the right way to build bridges? But Chris, are we getting that right? >> Well, let's take the first steps first. So, Ericsson, of course, acquired Vonage, which is a massive API business so they want to make money. They expect to make money by bringing that into the mainstream telecom community. Now, whether it's the developers who pay for it, or let's face it, we are moving into a situation as the telco moves into a techco model where the techco means they're going to be selling bits of the technology to developer guys and to other application developers. So when he says he needs to charge other people for it, it's the way in which people reach in and will take going through those open APIs like the open gateway announced today, but also the way they'll reach in and take things like network slicing. So we're opening up the telecom community, the treasure chest, if you like, where developers' applications and other third parties can come in and take those chunks of technology and build them into their services. This is a complete change from the old telecom industry where everybody used to come and you say, "all right, this is my product, you've got to buy it and you're going to pay me a lot of money for it." So we are looking at a more flexible environment where the other parties can take those chunks. And we know we want collectivity built into our financial applications, into our government applications, everything, into the future of the metaverse, whatever it may be. But it requires that change in attitude of the telcos. And they do need more money 'cause they've said, the baseline of revenue is pretty static, there's not a lot of growth in there so they're looking for new revenues. It's in a B2B2X time model. And it's probably the middle man's going to pay for it rather than the customer. >> But the techco model, Sarbjeet, it looks like the telcos are getting their money on their way in. The techco company model's to get them on their way out like the app store. Go build something of value, build some kind of app or data product, and then when it takes off, we'll take a piece of the action. What are your thoughts from a developer perspective about how the telcos are approaching it? >> Yeah, I think before we came here, like I said, I did some tweets on this, that we talk about all kind of developers, like there's game developers and front end, back end, and they're all talking about like what they're building on top of cloud, but nowhere you will hear the term "telco developer," there's no API from telcos given to the developers to build IoT solutions on top of it because telco as an IoT, I think is a good sort of hand in hand there. And edge computing as well. The glimmer of hope, if you will, for telcos is the edge computing, I believe. And even in edge, I predicted, I said that many times that cloud players will dominate that market with the private 5G. You know that story, right? >> We're going to talk about that. (laughs) >> The key is this, that if you see in general where the population lives, in metros, right? That's where the world population is like flocking to and we have cloud providers covering the local zones with local like heavy duty presence from the big cloud providers and then these telcos are getting sidetracked by that. Even the V2X in cars moving the autonomous cars and all that, even in that space, telcos are getting sidetracked in many ways. What telcos have to do is to join the forces, build some standards, if not standards, some consortium sort of. They're trying to do that with the open gateway here, they have only eight APIs. And it's 2023, eight APIs is nothing, right? (laughs) So they should have started this 10 years back, I think. So, yeah, I think to entice the developers, developers need the employability, we need to train them, we need to show them some light that hey, you can build a lot on top of it. If you tell developers they can develop two things or five things, nobody will come. >> So, Chris, the cloud will dominate the edge. So A, do you buy it? B, the telcos obviously are acting like that might happen. >> Do you know I love people when they've got their heads in the clouds. (all laugh) And you're right in so many ways, but if you flip it around and think about how the customers think about this, business customers and consumers, they don't care about all this background shenanigans going on, do they? >> Lisa: No. >> So I think one of the problems we have is that this is a new territory and whether you call it the edge or whatever you call it, what we need there is we need connectivity, we need security, we need storage, we need compute, we need analytics, and we need applications. And are any of those more important than the others? It's the collective that actually drives the real value there. So we need all those things together. And of course, the people who represented at this show, whether it's the cloud guys, the telcos, the Nokia, the Ericssons of this world, they all own little bits of that. So that's why they're all talking partnerships because they need the combination, they cannot do it on their own. The cloud guys can't do it on their own. >> Well, the cloud guys own all of those things that you just talked about though. (all laugh) >> Well, they don't own the last bit of connectivity, do they? They don't own the access. >> Right, exactly. That's the one thing they don't own. So, okay, we're back to pipes, right? We're back to charging for connectivity- >> Pipes are very valuable things, right? >> Yeah, for sure. >> Never underestimate pipes. I don't know about where you live, plumbers make a lot of money where I live- >> I don't underestimate them but I'm saying can the telcos charge for more than that or are the cloud guys going to mop up the storage, the analytics, the compute, and the apps? >> They may mop it up, but I think what the telcos are doing and we've seen a lot of it here already, is they are working with all those major cloud guys already. So is it an unequal relationship? The cloud guys are global, massive global scale, the telcos are fundamentally national operators. >> Yep. >> Some have a little bit of regional, nobody has global scale. So who stitches it all together? >> Dave: Keep your friends close and your enemies closer. >> Absolutely. >> I know that saying never gets old. It's true. Well, Sarbjeet, one of the things that you tweeted about, I didn't get to see the keynote but I was looking at your tweets. 46% of telcos think they won't make it to the next decade. That's a big number. Did that surprise you? >> No, actually it didn't surprise me because the competition is like closing in on them and the telcos are competing with telcos as well and the telcos are competing with cloud providers on the other side, right? So the smaller ones are getting squeezed. It's the bigger players, they can hook up the newer platforms, I think they will survive. It's like that part is like any other industry, if you will. But the key is here, I think why the pain points were sort of described on the main stage is that they're crying out loud to tell the big tech cloud providers that "hey, you pay your fair share," like we talked, right? You are not paying, you're generating so much content which reverses our networks and you are not paying for it. So they are not able to recoup the cost of laying down their networks. By the way, one thing actually I want to mention is that they said the cloud needs earth. The cloud and earth, it's like there's no physical need to cloud, you know that, right? So like, I think it's the other way around. I think the earth needs the cloud because I'm a cloud guy. (Sarbjeet and Lisa laugh) >> I think you need each other, right? >> I think so too. >> They need each other. When they said cloud needs earth, right? I think they're still in denial that the cloud is a big force. They have to partner. When you can't compete with somebody, what do you do? Partner with them. >> Chris, this is your world. Are they in denial? >> No, I think they're waking up to the pragmatism of the situation. >> Yeah. >> They're building... As we said, most of the telcos, you find have relationships with the cloud guys, I think you're right about the industry. I mean, do you think what's happened since US was '96, the big telecom act when we started breaking up all the big telcos and we had lots of competition came in, we're seeing the signs that we might start to aggregate them back up together again. So it's been an interesting experiment for like 30 years, hasn't it too? >> It made the US less competitive, I would argue, but carry on. >> Yes, I think it's true. And Europe is maybe too competitive and therefore, it's not driven the investment needed. And by the way, it's not just mobile, it's fixed as well. You saw the Orange CEO was talking about the her investment and the massive fiber investments way ahead of many other countries, way ahead of the UK or Germany. We need that fiber in the ground to carry all your cloud traffic to do this. So there is a scale issue, there is a competition issue, but the telcos are very much aware of it. They need the cloud, by the way, to improve their operational environments as well, to change that whole old IT environment to deliver you and I better service. So no, it absolutely is changing. And they're getting scale, but they're fundamentally offering the basic product, you call it pipes, I'll just say they're offering broadband to you and I and the business community. But they're stepping on dangerous ground, I think, when saying they want to charge the over the top guys for all the traffic they use. Those over the top guys now build a lot of the global networks, the backbone submarine network. They're putting a lot of money into it, and by giving us endless data for our individual usage, that cat is out the bag, I think to a large extent. >> Yeah. And Orange CEO basically said that, that they're not paying their fair share. I'm for net neutrality but the governments are going to have to fund this unless you let us charge the OTT. >> Well, I mean, we could of course renationalize. Where would that take us? (Dave laughs) That would make MWC very interesting next year, wouldn't it? To renationalize it. So, no, I think you've got to be careful what we wish for here. Creating the absolute clear product that is required to underpin all of these activities, whether it's IoT or whether it's cloud delivery or whether it's just our own communication stuff, delivering that absolutely ubiquitously high quality for business and for consumer is what we have to do. And telcos have been too conservative in the past. >> I think they need to get together and create standards around... I think they have a big opportunity. We know that the clouds are being built in silos, right? So there's Azure stack, there's AWS and there's Google. And those are three main ones and a few others, right? So that we are fighting... On the cloud side, what we are fighting is the multicloud. How do we consume that multicloud without having standards? So if these people get together and create some standards around IoT and edge computing sort of area, people will flock to them to say, "we will use you guys, your API, we don't care behind the scenes if you use AWS or Google Cloud or Azure, we will come to you." So market, actually is looking for that solution. I think it's an opportunity for these guys, for telcos. But the problem with telcos is they're nationalized, as you said Chris versus the cloud guys are still kind of national in a way, but they're global corporations. And some of the telcos are global corporations as well, BT covers so many countries and TD covers so many... DT is in US as well, so they're all over the place. >> But you know what's interesting is that the TM forum, which is one of the industry associations, they've had an open digital architecture framework for quite some years now. Google had joined that some years ago, Azure in there, AWS just joined it a couple of weeks ago. So when people said this morning, why isn't AWS on the keynote? They don't like sharing the limelight, do they? But they're getting very much in bed with the telco. So I think you'll see the marriage. And in fact, there's a really interesting statement, if you look at the IoT you mentioned, Bosch and Nokia have been working together 'cause they said, the problem we've got, you've got a connectivity network on one hand, you've got the sensor network on the other hand, you're trying to merge them together, it's a nightmare. So we are finally seeing those sort of groups talking to each other. So I think the standards are coming, the cooperation is coming, partnerships are coming, but it means that the telco can't dominate the sector like it used to. It's got to play ball with everybody else. >> I think they have to work with the regulators as well to loosen the regulation. Or you said before we started this segment, you used Chris, the analogy of sports, right? In sports, when you're playing fiercely, you commit the fouls and then ask for ref to blow the whistle. You're now looking at the ref all the time. The telcos are looking at the ref all the time. >> Dave: Yeah, can I do this? Can I do that? Is this a fair move? >> They should be looking for the space in front of the opposition. >> Yeah, they should be just on attack mode and commit these fouls, if you will, and then ask for forgiveness then- >> What do you make of that AWS not you there- >> Well, Chris just made a great point that they don't like to share the limelight 'cause I thought it was very obvious that we had Google Cloud, we had Microsoft there on day one of this 80,000 person event. A lot of people back from COVID and they weren't there. But Chris, you brought up a great point that kind of made me think, maybe you're right. Maybe they're in the afternoon keynote, they want their own time- >> You think GSMA invited them? >> I imagine so. You'd have to ask GSMA. >> I would think so. >> Get Max on here and ask that. >> I'm going to ask them, I will. >> But no, and they don't like it because I think the misconception, by the way, is that everyone says, "oh, it's AWS, it's Google Cloud and it's Azure." They're not all the same business by any stretch of the imagination. AWS has been doing loads of great work, they've been launching private network stuff over the last couple of weeks. Really interesting. Google's been playing catch up. We know that they came in readily late to the market. And Azure, they've all got slightly different angles on it. So perhaps it just wasn't right for AWS and the way they wanted to pitch things so they don't have to be there, do they? >> That's a good point. >> But the industry needs them there, that's the number one cloud. >> Dave, they're there working with the industry. >> Yeah, of course. >> They don't have to be on the keynote stage. And in fact, you think about this show and you mentioned the 80,000 people, the activity going on around in all these massive areas they're in, it's fantastic. That's where the business is done. The business isn't done up on the keynote stage. >> That's why there's the glitz and the glamour, Chris. (all laugh) >> Yeah. It's not glitz, it's espresso. It's not glamour anymore, it's just espresso. >> We need the espresso. >> Yeah. >> I think another thing is that it's interesting how an average European sees the tech market and an average North American, especially you from US, you have to see the market. Here, people are more like process oriented and they want the rules of the road already established before they can take a step- >> Chris: That's because it's your pension in the North American- >> Exactly. So unions are there and the more employee rights and everything, you can't fire people easily here or in Germany or most of the Europe is like that with the exception of UK. >> Well, but it's like I said, that Silicone Valley gets their money on the way out, you know? And that's how they do it, that's how they think it. And they don't... They ask for forgiveness. I think the east coast is more close to Europe, but in the EU, highly regulated, really focused on lifetime employment, things like that. >> But Dave, the issue is the telecom industry is brilliant, right? We keep paying every month whatever we do with it. >> It's a great business, to your point- >> It's a brilliant business model. >> Dave: It's fantastic. >> So it's about then getting the structure right behind it. And you know, we've seen a lot of stratification where people are selling off towers, Orange haven't sold their towers off, they made a big point about that. Others are selling their towers off. Some people are selling off their underlying network, Telecom Italia talking about KKR buying the whole underlying network. It's like what do you want to be in control of? It's a great business. >> But that's why they complain so much is that they're having to sell their assets because of the onerous CapEx requirements, right? >> Yeah, they've had it good, right? And dare I say, perhaps they've not planned well enough for the future. >> They're trying to protect their past from the future. I mean, that's... >> Actually, look at the... Every "n" number of years, there's a new faster network. They have to dig the ground, they have to put the fiber, they have to put this. Now, there are so many booths showing 6G now, we are not even done with 5G yet, now the next 6G you know, like then- >> 10G's coming- >> 10G, that's a different market. (Dave laughs) >> Actually, they're bogged down by the innovation, I think. >> And the generational thing is really important because we're planning for 6G in all sorts of good ways but actually what we use in our daily lives, we've gone through the barrier, we've got enough to do that. So 4G gives us enough, the fiber in the ground or even old copper gives us enough. So the question is, what are we willing to pay for more than that basic connectivity? And the answer to your point, Dave, is not a lot, right? So therefore, that's why the emphasis is on the business market on that B2B and B2B2X. >> But we'll pay for Netflix all day long. >> All day long. (all laugh) >> The one thing Chris, I don't know, I want to know your viewpoints and we have talked in the past as well, there's absence of think tanks in tech, right? So we have think tanks on the foreign policy and economic policy in every country, and we have global think tanks, but tech is becoming a huge part of the economy, global economy as well as national economies, right? But we don't have think tanks on like policy around tech. For example, this 4G is good for a lot of use cases. Then 5G is good for smaller number of use cases. And then 6G will be like, fewer people need 6G for example. Why can't we have sort of those kind of entities dictating those kind of like, okay, is this a wiser way to go about it? >> Lina Khan wants to. She wants to break up big tech- >> You're too young to remember but the IT used to have a show every four years in Geneva, there were standards around there. So I think there are bodies. I think the balance of power obviously has gone from the telecom to the west coast to the IT markets. And it's changing the balance about, it moves more quickly, right? Telecoms has never moved quickly enough. I think there is hope by the way, that telecoms now that we are moving to more softwarized environment, and God forbid, we're moving into CICD in the telecom world, right? Which is a massive change, but I think there's hopes for it to change. The mentality is changing, the culture is changing, but to change those old structured organizations from the British telecom or the France telecom into the modern world, it's a hell of a long journey. It's not an overnight journey at all. >> Well, of course the theme of the event is velocity. >> Yeah, I know that. >> And it's been interesting sitting here with the three of you talking about from a historic perspective, how slow and molasseslike telecom has been. They don't have a choice anymore. As consumers, we have this expectation we're going to get anything we want on our mobile device, 24 by seven. We don't care about how the sausage is made, we just want the end result. So do you really think, and we're only on day one guys... And Chris we'll start with you. Is the theme really velocity? Is it disruption? Are they able to move faster? >> Actually, I think invisibility is the real answer. (Lisa laughs) We want communication to be invisible, right? >> Absolutely. >> We want it to work. When we switch our phones on, we want it to work and we want to... Well, they're not even phones anymore, are they really? I mean that's the... So no, velocity, we've got... There is momentum in the industry, there's no doubt about that. The cloud guys coming in, making telecoms think about the way they run their own business, where they meet, that collision point on the edges you talked about Sarbjeet. We do have velocity, we've got momentum. There's so many interested parties. The way I think of this is that the telecom industry used to be inward looking, just design its own technology and then expect everyone else to dance to our tune. We're now flipping that 180 degrees and we are now having to work with all the different outside forces shaping us. Whether it's devices, whether it's smart cities, governments, the hosting guys, the Equinoxis, all these things. So everyone wants a piece of this telecom world so we've got to make ourselves more open. That's why you get in a more open environment. >> But you did... I just want to bring back a point you made during COVID, which was when everybody switched to work from home, started using their landlines again, telcos had to respond and nothing broke. I mean, it was pretty amazing. >> Chris: It did a good job. >> It was kind of invisible. So, props to the telcos for making that happen. >> They did a great job. >> So it really did. Now, okay, what have you done for me lately? So now they've got to deal with the future and they're talking monetization. But to me, monetization is all about data and not necessarily just the network data. Yeah, they can sell that 'cause they own that but what kind of incremental value are they going to create for the consumers that... >> Yeah, actually that's a problem. I think the problem is that they have been strangled by the regulation for a long time and they cannot look at their data. It's a lot more similar to the FinTech world, right? I used to work at Visa. And then Visa, we did trillion dollars in transactions in '96. Like we moved so much money around, but we couldn't look at these things, right? So yeah, I think regulation is a problem that holds you back, it's the antithesis of velocity, it slows you down. >> But data means everything, doesn't it? I mean, it means everything and nothing. So I think the challenge here is what data do the telcos have that is useful, valuable to me, right? So in the home environment, the fact that my broadband provider says, oh, by the way, you've got 20 gadgets on that network and 20 on that one... That's great, tell me what's on there. I probably don't know what's taking all my valuable bandwidth up. So I think there's security wrapped around that, telling me the way I'm using it if I'm getting the best out of my service. >> You pay for that? >> No, I'm saying they don't do it yet. I think- >> But would you pay for that? >> I think I would, yeah. >> Would you pay a lot for that? I would expect it to be there as part of my dashboard for my monthly fee. They're already charging me enough. >> Well, that's fine, but you pay a lot more in North America than I do in Europe, right? >> Yeah, no, that's true. >> You're really overpaying over there, right? >> Way overpaying. >> So, actually everybody's looking at these devices, right? So this is a radio operated device basically, right? And then why couldn't they benefit from this? This is like we need to like double click on this like 10 times to find out why telcos failed to leverage this device, right? But I think the problem is their reliance on regulations and their being close to the national sort of governments and local bodies and authorities, right? And in some countries, these telcos are totally controlled in very authoritarian ways, right? It's not like open, like in the west, most of the west. Like the world is bigger than five, six countries and we know that, right? But we end up talking about the major economies most of the time. >> Dave: Always. >> Chris: We have a topic we want to hit on. >> We do have a topic. Our last topic, Chris, it's for you. You guys have done an amazing job for the last 25 minutes talking about the industry, where it's going, the evolution. But Chris, you're registered blind throughout your career. You're a leading user of assertive technologies. Talk about diversity, equity, inclusion, accessibility, some of the things you're doing there. >> Well, we should have had 25 minutes on that and five minutes on- (all laugh) >> Lisa: You'll have to come back. >> Really interesting. So I've been looking at it. You're quite right, I've been using accessible technology on my iPhone and on my laptop for 10, 20 years now. It's amazing. And what I'm trying to get across to the industry is to think about inclusive design from day one. When you're designing an app or you're designing a service, make sure you... And telecom's a great example. In fact, there's quite a lot of sign language around here this week. If you look at all the events written, good to see that coming in. Obviously, no use to me whatsoever, but good for the hearing impaired, which by the way is the biggest category of disability in the world. Biggest chunk is hearing impaired, then vision impaired, and then cognitive and then physical. And therefore, whenever you're designing any service, my call to arms to people is think about how that's going to be used and how a blind person might use it or how a deaf person or someone with physical issues or any cognitive issues might use it. And a great example, the GSMA and I have been talking about the app they use for getting into the venue here. I downloaded it. I got the app downloaded and I'm calling my guys going, where's my badge? And he said, "it's top left." And because I work with a screen reader, they hadn't tagged it properly so I couldn't actually open my badge on my own. Now, they changed it overnight so it worked this morning, which is fantastic work by Trevor and the team. But it's those things that if you don't build it in from scratch, you really frustrate a whole group of users. And if you think about it, people with disabilities are excluded from so many services if they can't see the screen or they can't hear it. But it's also the elderly community who don't find it easy to get access to things. Smart speakers have been a real blessing in that respect 'cause you can now talk to that thing and it starts talking back to you. And then there's the people who can't afford it so we need to come down market. This event is about launching these thousand dollars plus devices. Come on, we need below a hundred dollars devices to get to the real mass market and get the next billion people in and then to educate people how to use it. And I think to go back to your previous point, I think governments are starting to realize how important this is about building the community within the countries. You've got some massive projects like NEOM in Saudi Arabia. If you have a look at that, if you get a chance, a fantastic development in the desert where they're building a new city from scratch and they're building it so anyone and everyone can get access to it. So in the past, it was all done very much by individual disability. So I used to use some very expensive, clunky blind tech stuff. I'm now using mostly mainstream. But my call to answer to say is, make sure when you develop an app, it's accessible, anyone can use it, you can talk to it, you can get whatever access you need and it will make all of our lives better. So as we age and hearing starts to go and sight starts to go and dexterity starts to go, then those things become very useful for everybody. >> That's a great point and what a great champion they have in you. Chris, Sarbjeet, Dave, thank you so much for kicking things off, analyzing day one keynote, the ecosystem day, talking about what velocity actually means, where we really are. We're going to have to have you guys back 'cause as you know, we can keep going, but we are out of time. But thank you. >> Pleasure. >> We had a very spirited, lively conversation. >> Thanks, Dave. >> Thank you very much. >> For our guests and for Dave Vellante, I'm Lisa Martin, you're watching theCUBE live in Barcelona, Spain at MWC '23. We'll be back after a short break. See you soon. (uplifting instrumental music)

(cheerful music) >> Welcome to theCUBE's continuing coverage of AMD's 4th Generation EPYC launch. I'm Dave Nicholson, and I'm here in our Palo Alto studios talking to Greg Gibby, senior product manager, data center products from AMD, and Mohan Rokkam, technical marketing engineer at Dell. Welcome, gentlemen. >> Mohan: Hello, hello. >> Greg: Thank you. Glad to be here. >> Good to see each of you. Just really quickly, I want to start out. Let us know a little bit about yourselves. Mohan, let's start with you. What do you do at Dell exactly? >> So I'm a technical marketing engineer at Dell. I've been with Dell for around 15 years now and my goal is to really look at the Dell powered servers and see how do customers take advantage of some of the features we have, especially with the AMD EPYC processors that have just come out. >> Greg, and what do you do at AMD? >> Yeah, so I manage our software-defined infrastructure solutions team, and really it's a cradle to grave where we work with the ISVs in the market, so VMware, Nutanix, Microsoft, et cetera, to integrate the features that we're putting into our processors and make sure they're ready to go and enabled. And then we work with our valued partners like Dell on putting those into actual solutions that customers can buy and then we work with them to sell those solutions into the market. >> Before we get into the details on the 4th Generation EPYC launch and what that means and why people should care. Mohan, maybe you can tell us a little about the relationship between Dell and AMD, how that works, and then Greg, if you've got commentary on that afterwards, that'd be great. Yeah, Mohan. >> Absolutely. Dell and AMD have a long standing partnership, right? Especially now with EPYC series. We have had products since EPYC first generation. We have been doing solutions across the whole range of Dell ecosystem. We have integrated AMD quite thoroughly and effectively and we really love how performant these systems are. So, yeah. >> Dave: Greg, what are your thoughts? >> Yeah, I would say the other thing too is, is that we need to point out is that we both have really strong relationships across the entire ecosystem. So memory vendors, the software providers, et cetera, we have technical relationships. We're working with them to optimize solutions so that ultimately when the customer buys that, they get a great user experience right out of the box. >> So, Mohan, I know that you and your team do a lot of performance validation testing as time goes by. I suspect that you had early releases of the 4th Gen EPYC processor technology. What have you been seeing so far? What can you tell us? >> AMD has definitely knocked it out of the park. Time and again, in the past four generations, in the past five years alone, we have done some database work where in five years, we have seen five exit performance. And across the board, AMD is the leader in benchmarks. We have done virtualization where we would consolidate from five into one system. We have world records in AI, we have world records in databases, we have world records in virtualization. The AMD EPYC solutions has been absolutely performant. I'll leave you with one number here. When we went from top of Stack Milan to top of Stack Genoa, we saw a performance bump of 120%. And that number just blew my mind. >> So that prompts a question for Greg. Often we, in industry insiders, think in terms of performance gains over the last generation or the current generation. A lot of customers in the real world, however, are N - 2. They're a ways back, so I guess two points on that. First of all, the kinds of increases the average person is going to see when they move to this architecture, correct me if I'm wrong, but it's even more significant than a lot of the headline numbers because they're moving two generations, number one. Correct me if I'm wrong on that, but then the other thing is the question to you, Greg. I like very long complicated questions, as you can tell. The question is, is it okay for people to skip generations or make the case for upgrades, I guess is the problem? >> Well, yeah, so a couple thoughts on that first too. Mohan talked about that five X over the generation improvements that we've seen. The other key point with that too is that we've made significant process improvements along the way moving to seven nanocomputer to now five nanocomputer and that's really reducing the total amount of power or the performance per watt the customers can realize as well. And when we look at why would a customer want to upgrade, right? And I want to rephrase that as to why aren't you? And there is a real cost of not upgrading. And so when you look at infrastructure, the average age of a server in the data center is over five years old. And if you look at the most popular processors that were sold in that timeframe, it's 8, 10, 12 cores. So now you've got a bunch of servers that you need in order to deliver the applications and meet your SLAs to your end users, and all those servers pull power. They require maintenance. They have the opportunity to go down, et cetera. You got to pay licensing and service and support costs and all those. And when you look at all the costs that roll up, even though the hardware is paid for just to keep the lights on, and not even talking about the soft costs of unplanned downtime, and, "I'm not meeting your SLAs," et cetera, it's very expensive to keep those servers running. Now, if you refresh, and now you have processors that have 32, 64, 96 cores, now you can consolidate that infrastructure and reduce your total power bill. You can reduce your CapEx, you reduce your ongoing OpEx, you improve your performance, and you improve your security profile. So it really is more cost effective to refresh than not to refresh. >> So, Mohan, what has your experience been double clicking on this topic of consolidation? I know that we're going to talk about virtualization in some of the results that you've seen. What have you seen in that regard? Does this favor better consolidation and virtualized environments? And are you both assuring us that the ROI and TCO pencil out on these new big, bad machines? >> Greg definitely hit the nail on the head, right? We are seeing tremendous savings really, if you're consolidating from two generations old. We went from, as I said, five is to one. You're going from five full servers, probably paid off down to one single server. That itself is, if you look at licensing costs, which again, with things like VMware does get pretty expensive. If you move to a single system, yes, we are at 32, 64, 96 cores, but if you compare to the licensing costs of 10 cores, two sockets, that's still pretty significant, right? That's one huge thing. Another thing which actually really drives the thing is we are looking at security, and in today's environment, security becomes a major driving factor for upgrades. Dell has its own setups, cyber-resilient architecture, as we call it, and that really is integrated from processor all the way up into the OS. And those are some of the features which customers really can take advantage of and help protect their ecosystems. >> So what kinds of virtualized environments did you test? >> We have done virtualization across primary codes with VMware, but the Azure Stack, we have looked at Nutanix. PowerFlex is another one within Dell. We have vSAN Ready Nodes. All of these, OpenShift, we have a broad variety of solutions from Dell and AMD really fits into almost every one of them very well. >> So where does hyper-converged infrastructure fit into this puzzle? We can think of a server as something that contains not only AMD's latest architecture but also latest PCIe bus technology and all of the faster memory, faster storage cards, faster nicks, all of that comes together. But how does that play out in Dell's hyper-converged infrastructure or HCI strategy? >> Dell is a leader in hyper-converged infrastructure. We have the very popular VxRail line, we have the PowerFlex, which is now going into the AWS ecosystem as well, Nutanix, and of course, Azure Stack. With all these, when you look at AMD, we have up to 96 cores coming in. We have PCIe Gen 5 which means you can now connect dual port, 100 and 200 gig nicks and get line rate on those so you can connect to your ecosystem. And I don't know if you've seen the news, 200, 400 gig routers and switchers are selling out. That's not slowing down. The network infrastructure is booming. If you want to look at the AI/ML side of things, the VDI side of things, accelerator cards are becoming more and more powerful, more and more popular. And of course they need that higher end data path that PCIe Gen 5 brings to the table. GDDR5 is another huge improvement in terms of performance and latencies. So when we take all this together, you talk about hyper-converged, all of them add into making sure that A, with hyper-converged, you get ease of management, but B, just 'cause you have ease of management doesn't mean you need to compromise on anything. And the AMD servers effectively are a no compromise offering that we at Dell are able to offer to our customers. >> So Greg, I've got a question a little bit from left field for you. We covered Supercompute Conference 2022. We were in Dallas a couple of weeks ago, and there was a lot of discussion of the current processor manufacturer battles, and a lot of buzz around 4th Gen EPYC being launched and what's coming over the next year. Do you have any thoughts on what this architecture can deliver for us in terms of things like AI? We talk about virtualization, but if you look out over the next year, do you see this kind of architecture driving significant change in the world? >> Yeah, yeah, yeah, yeah. It has the real potential to do that from just the building blocks. So we have our chiplet architecture we call it. So you have an IO die and then you have your core complexes that go around that. And we integrate it all with our infinity fabric. That architecture allows you, if we wanted to, replace some of those CCDs with specific accelerators. And so when we look two, three, four years down the road, that architecture and that capability already built into what we're delivering and can easily be moved in. We just need to make sure that when you look at doing that, that the power that's required to do that and the software, et cetera, and those accelerators actually deliver better performance as a dedicated engine versus just using standard CPUs. The other things that I would say too is if you look at emerging workloads. So data center modernization is one of the buzzwords in cloud native, right? And these container environments, well, AMD'S architecture really just screams support for those type of environments, right? Where when you get into these larger core accounts and the consolidation that Mohan talked about. Now when I'm in a container environment, that blast radius so a lot of customers have concerns around, "Hey, having a single point of failure and having more than X number of cores concerns me." If I'm in containers, that becomes less of a concern. And so when you look at cloud native, containerized applications, data center modernization, AMD's extremely well positioned to take advantage of those use cases as well. >> Yeah, Mohan, and when we talk about virtualization, I think sometimes we have to remind everyone that yeah, we're talking about not only virtualization that has a full-blown operating system in the bucket, but also virtualization where the containers have microservices and things like that. I think you had something to add, Mohan. >> I did, and I think going back to the accelerator side of business, right? When we are looking at the current technology and looking at accelerators, AMD has done a fantastic job of adding in features like AVX-512, we have the bfloat16 and eight features. And some of what these do is they're effectively built-in accelerators for certain workloads especially in the AI and media spaces. And in some of these use cases we look at, for example, are inference. Traditionally we have used external accelerator cards, but for some of the entry level and mid-level use cases, CPU is going to work just fine especially with the newer CPUs that we are seeing this fantastic performance from. The accelerators just help get us to the point where if I'm at the edge, if I'm in certain use cases, I don't need to have an accelerator in there. I can run most of my inference workloads right on the CPU. >> Yeah, yeah. You know the game. It's an endless chase to find the bottleneck. And once we've solved the puzzle, we've created a bottleneck somewhere else. Back to the supercompute conversations we had, specifically about some of the AMD EPYC processor technology and the way that Dell is packaging it up and leveraging things like connectivity. That was one of the things that was also highlighted. This idea that increasingly connectivity is critically important, not just for supercomputing, but for high-performance computing that's finding its way out of the realms of Los Alamos and down to the enterprise level. Gentlemen, any more thoughts about the partnership or maybe a hint at what's coming in the future? I know that the original AMD announcement was announcing and previewing some things that are rolling out over the next several months. So let me just toss it to Greg. What are we going to see in 2023 in terms of rollouts that you can share with us? >> That I can share with you? Yeah, so I think look forward to see more advancements in the technology at the core level. I think we've already announced our product code name Bergamo, where we'll have up to 128 cores per socket. And then as we look in, how do we continually address this demand for data, this demand for, I need actionable insights immediately, look for us to continue to drive performance leadership in our products that are coming out and address specific workloads and accelerators where appropriate and where we see a growing market. >> Mohan, final thoughts. >> On the Dell side, of course, we have four very rich and configurable options with AMD EPYC servers. But beyond that, you'll see a lot more solutions. Some of what Greg has been talking about around the next generation of processors or the next updated processors, you'll start seeing some of those. and you'll definitely see more use cases from us and how customers can implement them and take advantage of the features that. It's just exciting stuff. >> Exciting stuff indeed. Gentlemen, we have a great year ahead of us. As we approach possibly the holiday seasons, I wish both of you well. Thank you for joining us. From here in the Palo Alto studios, again, Dave Nicholson here. Stay tuned for our continuing coverage of AMD's 4th Generation EPYC launch. Thanks for joining us. (cheerful music)

>> Announcer: theCube presents HPE Discover 2022, brought to you by HPE. >> Hey, everyone. Welcome back to Las Vegas. This is Lisa Martin with Dave Vellante live at HPE Discover '22. Dave, it's great to be here. This is the first Discover in three years and we're here with about 7,000 of our closest friends. >> Yeah. You know, I tweeted out this, I think I've been to 14 Discovers between the U.S. and Europe, and I've never seen a Discover with so much energy. People are not only psyched to get back together, that's for sure, but I think HPE's got a little spring in its step and it's feeling more confident than maybe some of the past Discovers that I've been to. >> I think so, too. I think there's definitely a spring in the step and we're going to be unpacking some of that spring next with one of our alumni who joins us, Keith White's here, the executive vice president and general manager of GreenLake Cloud Services. Welcome back. >> Great. You all thanks for having me. It's fantastic that you're here and you're right, the energy is crazy at this show. It's been a lot of pent up demand, but I think what you heard from Antonio today is our strategy's changing dramatically and it's really embracing our customers and our partners. So it's great. >> Embracing the customers and the partners, the ecosystem expansion is so critical, especially the last couple of years with the acceleration of digital transformation. So much challenge in every industry, but lots of momentum on the GreenLake side, I was looking at the Q2 numbers, triple digit growth in orders, 65,000 customers over 70 services, eight new services announced just this morning. Talk to us about the momentum of GreenLake. >> The momentum's been fantastic. I mean, I'll tell you, the fact that customers are really now reaccelerating their digital transformation, you probably heard a lot, but there was a delay as we went through the pandemic. So now it's reaccelerating, but everyone's going to a hybrid, multi-cloud environment. Data is the new currency. And obviously, everyone's trying to push out to the Edge and GreenLake is that edge to cloud platform. So we're just seeing tons of momentum, not just from the customers, but partners, we've enabled the platform so partners can plug into it and offer their solutions to our customers as well. So it's exciting and it's been fun to see the momentum from an order standpoint, but one of the big numbers that you may not be aware of is we have over a 96% retention rate. So once a customer's on GreenLake, they stay on it because they're seeing the value, which has been fantastic. >> The value is absolutely critically important. We saw three great big name customers. The Home Depot was on stage this morning, Oak Ridge National Laboratory was as well, Evil Geniuses. So the momentum in the enterprise is clearly present. >> Yeah. It is. And we're hearing it from a lot of customers. And I think you guys talk a lot about, hey, there's the cloud, data and Edge, these big mega trends that are happening out there. And you look at a company like Barclays, they're actually reinventing their entire private cloud infrastructure, running over a hundred thousand workloads on HPE GreenLake. Or you look at a company like Zenseact, who's basically they do autonomous driving software. So they're doing massive parallel computing capabilities. They're pulling in hundreds of petabytes of data to then make driving safer and so you're seeing it on the data front. And then on the Edge, you look at anyone like a Patrick Terminal, for example. They run a whole terminal shipyard. They're getting data in from exporters, importers, regulators, the works and they have to real-time, analyze that data and say, where should this thing go? Especially with today's supply chain challenges, they have to be so efficient, that it's just fantastic. >> It was interesting to hear Fidelma, Keith, this morning on stage. It was the first time I'd really seen real clarity on the platform itself and that it's obviously her job is, okay, here's the platform, now, you guys got to go build on top of it. Both inside of HPE, but also externally, so your ecosystem partners. So, you mentioned the financial services companies like Barclays. We see those companies moving into the digital world by offering some of their services in building their own clouds. >> Keith: That's right. >> What's your vision for GreenLake in terms of being that platform, to assist them in doing that and the data component there? >> I think that was one of the most exciting things about not just showcasing the platform, but also the announcement of our private cloud enterprise, Cloud Service. Because in essence, what you're doing is you're creating that framework for what most companies are doing, which is they're becoming cloud service providers for their internal business units. And they're having to do showback type scenarios, chargeback type scenarios, deliver cloud services and solutions inside the organization so that open platform, you're spot on. For our ecosystem, it's fantastic, but for our customers, they get to leverage it as well for their own internal IT work that's happening. >> So you talk about hybrid cloud, you talk about private cloud, what's your vision? You know, we use this term Supercloud. This in a layer that goes across clouds. What's your thought about that? Because you have an advantage at the Edge with Aruba. Everybody talks about the Edge, but they talk about it more in the context of near Edge. >> That's right. >> We talked to Verizon and they're going far Edge, you guys are participating in that, as well as some of your partners in Red Hat and others. What's your vision for that? What I call Supercloud, is that part of the strategy? Is that more longer term or you think that's pipe dream by Dave? >> No, I think it's really thoughtful, Dave, 'cause it has to be part of the strategy. What I hear, so for example, Ford's a great example. They run Azure, AWS, and then they made a big deal with Google cloud for their internal cars and they run HPE GreenLake. So they're saying, hey, we got four clouds. How do we sort of disaggregate the usage of that? And Chris Lund, who is the VP of information technology at Liberty Mutual Insurance, he talked about it today, where he said, hey, I can deliver these services to my business unit. And they don't know, am I running on the public cloud? Am I running on our HPE GreenLake cloud? Like it doesn't matter to the end user, we've simplified that so much. So I think your Supercloud idea is super thoughtful, not to use the super term too much, that I'm super excited about because it's really clear of what our customers are trying to accomplish, which it's not about the cloud, it's about the solution and the business outcome that gets to work. >> Well, and I think it is different. I mean, it's not like the last 10 years where it was like, hey, I got my stuff to work on the different clouds and I'm replicating as much as I can, the cloud experience on-prem. I think you guys are there now and then to us, the next layer is that ecosystem enablement. So how do you see the ecosystem evolving and what role does Green Lake play there? >> Yeah. This has been really exciting. We had Tarkan Maner who runs Nutanix and Karl Strohmeyer from Equinix on stage with us as well. And what's happening with the ecosystem is, I used to say, one plus one has to equal three for our customers. So when you bring these together, it has to be that scenario, but we are joking that one plus one plus one equals five now because everything has a partner component to it. It's not about the platform, it's not about the specific cloud service, it's actually about the solution that gets delivered. And that's done with an ISV, it's done with a Colo, it's done even with the Hyperscalers. We have Azure Stack HCI as a fully integrated solution. It happens with managed service providers, delivering managed services out to their folks as well. So that platform being fully partner enabled and that ecosystem being able to take advantage of that, and so we have to jointly go to market to our customers for their business needs, their business outcomes. >> Some of the expansion of the ecosystem. we just had Red Hat on in the last hour talking about- >> We're so excited to partner with them. >> Right, what's going on there with OpenShift and Ansible and Rel, but talk about the customer influence in terms of the expansion of the ecosystem. We know we've got to meet customers where they are, they're driving it, but we know that HPE has a big presence in the enterprise and some pretty big customer names. How are they from a demand perspective? >> Well, this is where I think the uniqueness of GreenLake has really changed HPE's approach with our customers. Like in all fairness, we used to be a vendor that provided hardware components for, and we talked a lot about hardware costs and blah, blah, blah. Now, we're actually a partner with those customers. What's the business outcome you're requiring? What's the SLA that we offer you for what you're trying to accomplish? And to do that, we have to have it done with partners. And so even on the storage front, Qumulo or Cohesity. On the backup and recovery disaster recovery, yes, we have our own products, but we also partner with great companies like Veeam because it's customer choice, it's an open platform. And the Red Hat announcement is just fantastic. Because, hey, from a container platform standpoint, OpenShift provides 5,000 plus customers, 90% of the fortune 500 that they engage with, with that opportunity to take GreenLake with OpenShift and implement that container capabilities on-prem. So it's fantastic. >> We were talking after the keynote, Keith Townsend came on, myself and Lisa. And he was like, okay, what about startups? 'Cause that's kind of a hallmark of cloud. And we felt like, okay, startups are not the ideal customer profile necessarily for HPE. Although we saw Evil Geniuses up on stage, but I threw out and I'd love to get your thoughts on this that within companies, incumbents, you have entrepreneurs, they're trying to build their own clouds or Superclouds as I use the term, is that really the target for the developer audience? We've talked a lot about OpenShift with their other platforms, who says as a partner- >> We just announced another extension with Rancher and- >> Yeah. I saw that. And you have to have optionality for developers. Is that the way we should think about the target audience from a developer standpoint? >> I think it will be as we go forward. And so what Fidelma presented on stage was the new developer platform, because we have come to realize, we have to engage with the developers. They're the ones building the apps. They're the ones that are delivering the solutions for the most part. So yeah, I think at the enterprise space, we have a really strong capability. I think when you get into the sort of mid-market SMB standpoint, what we're doing is we're going directly to the managed service and cloud service providers and directly to our Disty and VARS to have them build solutions on top of GreenLake, powered by GreenLake, to then deliver to their customers because that's what the customer wants. I think on the developer side of the house, we have to speak their language, we have to provide their capabilities because they're going to start articulating apps that are going to use both the public cloud and our on-prem capabilities with GreenLake. And so that's got to work very well. And so you've heard us talk about API based and all of that sort of scenario. So it's an exciting time for us, again, moving HPE strategy into something very different than where we were before. >> Well, Keith, that speaks to ecosystem. So I don't know if you were at Microsoft, when the sweaty Steve Ballmer was working with the developers, developers. That's about ecosystem, ecosystem, ecosystem. I don't expect we're going to see Antonio replicating that. But that really is the sort of what you just described is the ecosystem developing on top of GreenLake. That's critical. >> Yeah. And this is one of the things I learned. So, being at Microsoft for as long as I was and leading the Azure business from a commercial standpoint, it was all about the partner and I mean, in all fairness, almost every solution that gets delivered has some sort of partner component to it. Might be an ISV app, might be a managed service, might be in a Colo, might be with our hybrid cloud, with our Hyperscalers, but everything has a partner component to it. And so one of the things I learned with Azure is, you have to sell through and with your ecosystem and go to that customer with a joint solution. And that's where it becomes so impactful and so powerful for what our customers are trying to accomplish. >> When we think about the data gravity and the value of data that put massive potential that it has, even Antonio talked about it this morning, being data rich but insights poor for a long time. >> Yeah. >> Every company in today's day and age has to be a data company to be competitive, there's no more option for that. How does GreenLake empower companies? GreenLake and its ecosystem empower companies to really live being data companies so that they can meet their customers where they are. >> I think it's a really great point because like we said, data's the new currency. Data's the new gold that's out there and people have to get their arms around their data estate. So then they can make these business decisions, these business insights and garner that. And Dave, you mentioned earlier, the Edge is bringing a ton of new data in, and my Zenseact example is a good one. But with GreenLake, you now have a platform that can do data and data management and really sort of establish and secure the data for you. There's no data latency, there's no data egress charges. And which is what we typically run into with the public cloud. But we also support a wide range of databases, open source, as well as the commercial ones, the sequels and those types of scenarios. But what really comes to life is when you have to do analytics on that and you're doing AI and machine learning. And this is one of the benefits I think that people don't realize with HPE is, the investments we've made with Cray, for example, we have and you saw on stage today, the largest supercomputer in the world. That depth that we have as a company, that then comes down into AI and analytics for what we can do with high performance compute, data simulations, data modeling, analytics, like that is something that we, as a company, have really deep, deep capabilities on. So it's exciting to see what we can bring to customers all for that spectrum of data. >> I was excited to see Frontier, they actually achieve, we hosted an event, co-produced event with HPE during the pandemic, Exascale day. >> Yeah. >> But we weren't quite at Exascale, we were like right on the cusp. So to see it actually break through was awesome. So HPC is clearly a differentiator for Hewlett Packard Enterprise. And you talk about the egress. What are some of the other differentiators? Why should people choose GreenLake? >> Well, I think the biggest thing is, that it's truly is a edge to cloud platform. And so you talk about Aruba and our capabilities with a network attached and network as a service capabilities, like that's fairly unique. You don't see that with the other companies. You mentioned earlier to me that compute capabilities that we've had as a company and the storage capabilities. But what's interesting now is that we're sort of taking all of that expertise and we're actually starting to deliver these cloud services that you saw on stage, private cloud, AI and machine learning, high performance computing, VDI, SAP. And now we're actually getting into these industry solutions. So we talked last year about electronic medical records, this year, we've talked about 5g. Now, we're talking about customer loyalty applications. So we're really trying to move from these sort of baseline capabilities and yes, containers and VMs and bare metal, all that stuff is important, but what's really important is the services that you run on top of that, 'cause that's the outcomes that our customers are looking at. >> Should we expect you to be accelerating? I mean, look at what you did with Azure. You look at what AWS does in terms of the feature acceleration. Should we expect HPE to replicate? Maybe not to that scale, but in a similar cadence, we're starting to see that. Should we expect that actually to go faster? >> I think you couched it really well because it's not as much about the quantity, but the quality and the uses. And so what we've been trying to do is say, hey, what is our swim lane? What is our sweet spot? Where do we have a superpower? And where are the areas that we have that superpower and how can we bring those solutions to our customers? 'Cause I think, sometimes, you get over your skis a bit, trying to do too much, or people get caught up in the big numbers, versus the, hey, what's the real meat behind it. What's the tangible outcome that we can deliver to customers? And we see just a massive TAM. I want to say my last analysis was around $42 billion in the next three years, TAM and the Azure service on-prem space. And so we think that there's nothing but upside with the core set of workloads, the core set of solutions and the cloud services that we bring. So yeah, we'll continue to innovate, absolutely, amen, but we're not in a, hey we got to get to 250 this and 300 that, we want to keep it as focused as we can. >> Well, the vast majority of the revenue in the public cloud is still compute. I mean, not withstanding, Microsoft obviously does a lot in SaaS, but I'm talking about the infrastructure and service. Still, well, I would say over 50%. And so there's a lot of the services that don't make any revenue and there's that long tail, if I hear your strategy, you're not necessarily going after that. You're focusing on the quality of those high value services and let the ecosystem sort of bring in the rest. >> This is where I think the, I mean, I love that you guys are asking me about the ecosystem because this is where their sweet spot is. They're the experts on hyper-converged or databases, a service or VDI, or even with SAP, like they're the experts on that piece of it. So we're enabling that together to our customers. And so I don't want to give you the impression that we're not going to innovate. Amen. We absolutely are, but we want to keep it within that, that again, our swim lane, where we can really add true value based on our expertise and our capabilities so that we can confidently go to customers and say, hey, this is a solution that's going to deliver this business value or this capability for you. >> The partners might be more comfortable with that than, we only have one eye sleep with one eye open in the public cloud, like, okay, what are they going to, which value of mine are they grab next? >> You're spot on. And again, this is where I think, the power of what an Edge to cloud platform like HPE GreenLake can do for our customers, because it is that sort of, I mentioned it, one plus one equals three kind of scenario for our customers so. >> So we can leave your customers, last question, Keith. I know we're only on day one of the main summit, the partner growth summit was yesterday. What's the feedback been from the customers and the ecosystem in terms of validating the direction that HPE is going? >> Well, I think the fantastic thing has been to hear from our customers. So I mentioned in my keynote recently, we had Liberty Mutual and we had Texas Children's Hospital, and they're implementing HPE GreenLake in a variety of different ways, from a private cloud standpoint to a data center consolidation. They're seeing sustainability goals happen on top of that. They're seeing us take on management for them so they can take their limited resources and go focus them on innovation and value added scenarios. So the flexibility and cost that we're providing, and it's just fantastic to hear this come to life in a real customer scenario because what Texas Children is trying to do is improve patient care for women and children like who can argue with that. >> Nobody. >> So, yeah. It's great. >> Awesome. Keith, thank you so much for joining Dave and me on the program, talking about all of the momentum with HPE Greenlake. >> Always. >> You can't walk in here without feeling the momentum. We appreciate your insights and your time. >> Always. Thank you you for the time. Yeah. Great to see you as well. >> Likewise. >> Thanks. >> For Keith White and Dave Vellante, I'm Lisa Martin. You're watching theCube live, day one coverage from the show floor at HPE Discover '22. We'll be right back with our next guest. (gentle music)

(gentle music) >> We're back at the Seaport in Boston. I'm Dave Vellante with my co-host, Paul Gillin. Tracie Zenti is here. She's the Director of Global Partner Management at Microsoft, and Tom Anderson is the Vice President of Ansible at Red Hat. Guys, welcome to theCube. >> Hi, thank you. >> Yep. >> Ansible on Azure, we're going to talk about that. Why do I need Ansible? Why do I need that kind of automation in Azure? What's the problem you're solving there? >> Yeah, so automation itself is connecting customers' infrastructure to their end resources, so whether that infrastructure's in the cloud, whether it's in the data center, or whether it's at the edge. Ansible is the common automation platform that allows customers to reuse automation across all of those platforms. >> And so, Tracie, I mean, Microsoft does everything. Why do you need Red Hat to do Ansible? >> We want that automation, right? We want our customers to have that ease of use so they can be innovative and bring their workloads to Azure. So that's exactly why we want Ansible. >> Yeah, so kind of loaded questions here, right, as we were sort of talking offline. The nature of partnerships is changing. It's about co-creating, adding value together, getting those effects of momentum, but maybe talk about how the relationship started and how it's evolving and I'd love to have your perspective on the evolving nature of ecosystems. >> Yeah, I think the partnership with Red Hat has been strong for a number of years. I think my predecessor was in the role for five years. There was a person in there for a couple years before that. So I think seven or eight years, we've been working together and co-engineering. Red Hat enterprised Linux. It's co-engineered. Ansible was co-engineered. We work together, right? So we want it to run perfectly on our platform. We want it to be a good customer experience. I think the evolution that we're seeing is in how customers buy, right? They want us to be one company, right? They want it to be easy. They want be able to buy their software where they run it on the cloud. They don't want to have to call Red Hat to buy and then call us to buy and then deploy. And we can do all that now with Ansible's the first one we're doing this together and we'll grow that on our marketplace so that it's easy to buy, easy to deploy, easy to keep track of. >> This is not just Ansible in the marketplace. This is actually a fully managed service. >> That's right. >> What is the value you've added on top of that? >> So it runs in the customer account, but it acts kind of like SaaS. So Red Hat gets to manage it, right? And it's in their own tenant. So they get in the customer's own tenant, right? So with a service principle, Red Hat's able to do that management. Tom, do you want to add anything to that? >> Yeah, the customers don't have to worry about managing Ansible. They just worry about using Ansible to automate their infrastructure. So it's a kind of a win-win situation for us and for our customers. We manage the infrastructure for them and the customer's resources themselves and they get to just focus on automating their business. >> Now, if they want to do cross-cloud automation or automation to their hybrid cloud, will you support that as well? >> 100%. >> Absolutely. >> Yeah. >> We're totally fine with that, right? I mean, it's unrealistic to think customers run everything in one place. That isn't enterprise. That's not reality. So yeah, I'm fine with that. >> Well, that's not every cloud provider. >> No (laughing) that's true. >> You guys over here, at Amazon, you can't even say multicloud or you'll get thrown off the stage. >> Of course we'd love it to all run on Azure, but we want our customers to be happy and have choice, yeah. >> You guys have all, I mean, you've been around a long time. So you had a huge on-prem state, brought that to the cloud, and Azure Stack, I mean, it's been around forever and it's evolved. So you've always believed in, whatever you call it, Hybrid IT, and of course, you guys, that's your call of mission. >> Yeah, exactly. >> So how do you each see hybrid? Where's the points of agreement? It sounds like there's more overlap than gaps, but maybe you could talk about your perspective. >> Yeah, I don't think there are any points of disagreement. I think for us, it's meeting our customers where their center of gravity is, where they see their center of management gravity. If it's on Azure, great. If it's on their data center, that's okay, too. So they can manage to or from. So if Azure is their center of gravity, they can use automation, Ansible automation, to manage all the things on Azure, things on other cloud providers, things in their data center, all the way out to their edge. So they have the choice of what makes the most sense to them. >> And Azure Arc is obviously, that's how Azure Stack is evolving, right? >> Yeah, and we have Azure Arc integration with Ansible. >> Yeah. >> So yeah, absolutely. And I mean, we also have Rell on our marketplace, right? So you can buy the basement and you could buy the roof and everything in between. So we're growing the estate on marketplace as well to all the other products that we have in common. So absolutely. >> How much of an opportunity, just go if we go inside? Give us a little peak inside Microsoft. How much of an opportunity does Microsoft think about multi-cloud specifically? I'm not crazy about the term multicloud, 'cause to me, multicloud, runs an Azure, runs an AWS, runs on Google, maybe runs somewhere else. But multicloud meaning that common experience, your version of hybrid, if you will. How serious is Microsoft about that as a business opportunity? A lot of people would say, well, Microsoft really doesn't want. They want everything in their cloud. But I'd love to hear from you if that is good. >> Well, we have Azure Red Hat OpenShift, which is a Microsoft branded version of OpenShift. We have Ansible now on our marketplace. We also, of course, we have AKS. So I mean, container strategy runs anywhere. But we also obviously have services that enhance all these things. So I think, our marketplace is a third party marketplace. It is designed to let customers buy and run easily on Azure and we'd want to make that experience good. So I don't know that it's... I can't speak to our strategy on multicloud, but what I can speak to is when businesses need to do innovation, we want it to be easy to do that, right? We want it to be easy to buy, defined, buy, deploy, manage, and that's what we're trying to accomplish. >> Fair to say, you're not trying to stop it. >> No, yeah, yeah. >> Whether or not it evolves into something that you heavily lean into or see. >> When we were talking before the cameras turned on, you said that you think marketplaces are the future. Why do you say that? And how will marketplaces be differentiated from each other in the future? >> Well, our marketplace is really, first of all, I think, as you said off camera, they're now. You can buy now, right? There's nothing that stops you. But to me, it's an extension of consumerization of IT. I've been in IT and manageability for about 23 years and full automation is what we and IT used to always talk about, that single pane of glass. How do you keep track of everything? How do you make it easy? How do you support? And IT is always eeking out that last little bit of funding to do innovation, right? So what we can do with consumerization of IT is make it easier to innovate. Make it cheaper to innovate, right? So I think marketplaces do that, right? They've got gold images you can deploy. You're also able to deploy custom images. So I think the future is as particularly with ours, like we support, I don't remember the exact number, but over a hundred countries of tax calculation. We've got like 17 currencies. So as we progress and customers can run from anywhere in the world and buy from anywhere in the world and make it simple to do those things that used to take maybe two months to spin up services for innovation and Ansible helps with that, that's going to help enterprises innovate faster. And I think that's what marketplaces are really going to bring to the forefront is that innovation. >> Tom, why did Ansible, I'm going to say one, I mean, you're never done. But it was unclear a few years ago, which automation platform was going to win in the marketplace and clearly, Ansible has taken a leading position. Why? What were the factors that led to that? >> Honestly, it was the strength of the community, right? And Red Hat leaning into that community to support that community. When you look out at the upstream community for Ansible and the number of participants, active participants that are contributing to the community just increases its value to everybody. So the number of integrations, the number of things that you can automate with Ansible is in the thousands and thousands, and that's not because a group of Red Hat engineers wrote it. That's because our community partners, like Microsoft wrote the user integrations for Ansible. F5 does theirs. Customers take those and expand on them. So the number of use cases that we can address through the community and through our partners is immense. >> But that doesn't just happen. I mean, what have you done to cultivate that community? >> Well, it's in Red Hat's DNA, right? To be the catalyst in a community, to bring partners and users together, to share their knowledge and their expertise and their skills, and to make the code open. So anybody can go grab Ansible from upstream and start doing stuff with it, if they want. If they want to mature on it and management for it and support all the other things that Red Hat provides, then they come to us for a subscription. So it's really been about sort of catalyzing and supporting that community, and Red Hat is a good steward of these upstream communities. >> Is Azure putting Ansible to use actually within your own platform as opposed to being a managed service? Are you adopting Ansible for automation of the Azure Platform? >> I'll let you answer that. >> So two years ago, Microsoft presented at AnsibleFest, our fall conference, Budd Warrack, I'm butchering his last name, but he came on and told how the networking team at Microsoft supports about 35,000 access points across hundreds of buildings, all the Microsoft campuses using Ansible to do that. Fantastic story if you want to go on YouTube and look up that use case. So Microsoft is an avid user of the Ansible technology in their environment. >> Azure is kind of this really, I mean, incredible strategic platform for Microsoft. I wonder if you could talk about Azure as a honeypot for partners. I mean, it seems, I mean, the momentum is unbelievable. I mean, I pay attention to their earnings calls every quarter of Azure growth, even though I don't know what the exact number is, 'cause they won't give it to me but they give me the growth rates and it's actually accelerating. >> No lie. (Tracie laughing) >> I've got my number. It's in the tens of billions. I mean, I'm north of 35 billion, but growing at the high 30%. I mean, it's remarkable. So talk about the importance of that to the ecosystem as a honey pot. >> Paul Satia said it right. Many times partners are essential to our strategy. But if you think about it, software solves problems. We have software that solves problems. They have software that solves problems, right? So when IT and customers are thinking of solving a problem, they're thinking software, right? And we want that software to run on Azure. So partners have to be essential to our strategy. Absolutely. It's again, we're one team to the customer. They want to see that as working together seamlessly. They don't want it to be hardware Azure plus software. So that's absolutely critical to our success. >> And if I could add for us, the partners are super important. So some of our launch partners are like F5 and CyberArk who have certified Ansible content for Ansible on Azure. We have service provider partners like Accenture and Kindra that are launching with us and providing our joint customers with help to get up to speed. So it really is a partner play. >> Absolutely. >> Where are you guys taking this? Where do you want to see it go? What are some of the things that observers should pay attention to as marketers of success and evolution? >> Well, certainly for us, it's obviously customer adoption, but it is providing them with patterns. So out of the box patterns that makes it easy for them to get up and running and solve the use cases and problems that they run into most frequently. Problems ain't the right word. Challenges or opportunities on Azure to be able to automate the things. So we're really leaning into the different use cases, whether it's edge, whether it's cloud, whether it's cloud to edge, all of those things. We want to provide users with out of the box Ansible content that allows 'em to just get up and automating super fast, and doing that on Azure makes it way easier for us because we don't have to focus on the install and the setting up and configuring it. It's all just part of the experience >> And Tracie, for Microsoft, it's world domination with a smile. (all laughing) >> Of course. No, of course not. No, I think it's to continue to grow the co-engineering we do across all of the Red Hat products. I can't even tell you the number of things we work on together, but to look forward strategically at what opportunities we have across our products and theirs to integrate like Arc and Ansible, and then making it all easy to buy, making it available so that customers have choice and they can buy how they want to and simplify. So we're just going to continue to do that and we're at that infancy right now and as we grow, it'll just get easier and easier with more and more products. >> Well, bringing the edge into the equation is going to be really interesting. Microsoft with its gaming, vector is amazing, and recent, awesome acquisitions. All the gamers are excited about that and that's a huge edge play. >> You'll have to bring my son on for that interview. >> Yeah. >> My son will interview. >> He knows more than all of us, I'm sure. What about Ansible? What's ahead for Ansible? >> Edge, so part of the Red Hat play at the Edge. We've getting a lot of customer pull for both industrial Edge use cases in the energy sector. We've had a joint customer with Azure that has a combined Edge platform. Certainly, the cloud stuff that we're announcing today is a huge growth area. And then just general enterprise automation. There's lots of room to run there for Ansible. >> And lots of industries, right? >> Yeah. >> Telco, manufacturing. >> Retail. >> Retail. >> Yeah. >> Yeah. There's so many places to go, yeah, that need the help. >> The market's just, how you going to count it anymore? It's just enormous. >> Yeah. >> It's the entire GDP the world. But guys, thanks for coming to theCUBE. >> Yeah. >> Great story. Congratulations on the partnership and the announcements and look forward to speaking with you in the future. >> Yeah, thanks for having us. >> Thanks for having us. >> You're very welcome. And keep it right there. This is Dave Vellante for Paul Gillin. This is theCUBE's coverage of Red Hat Summit 2022. We'll be right back at Seaport in Boston. (gentle music)

(upbeat music) >> Kubernetes is maturing for example moving from quarterly releases to three per year, it's adding many of the capabilities that early on were avoided by Kubernetes committers, but now are going more mainstream, for example, more robust security and better support from mobile cluster management and other functions. But core Kubernetes by itself, doesn't get organizations where they need to go. That's why the ecosystem has stepped up to fill the gaps in application development. Developers as we know, they don't care about infrastructure, but they do care about building new apps, they care about modernizing existing apps, leveraging data, scaling, they care about automation look, they want to be cloud native. And one of the companies leading the ecosystem charge and building out more robust capabilities is Red Hat. And ahead of KubeCon Spain. It's our pleasure to welcome in Stu Miniman director of market insights at Red Hat to preview the event, Stu, good to see you, how you been? >> I'm doing awesome, Dave. Thanks for having me, great to be here. >> Yeah. So what's going on in Kube land these days? >> So it's funny Dave, if you were to kind of just listen out there in the marketplace, the CNCF has a survey that's like 96% of companies running Kubernetes production, everybody's doing it. And others will say, oh no, Kubernetes, only a small group group of people are using it, it's already probably got newer technologies that's replacing it. And the customers that I'm talking to Dave, first of all, yes, containers of Kubernetes, great growth growth rate, good adoption overall, I think we've said more than a year or two ago, we've probably crossed that chasm, the Jeff Moore, it's longer the early people just building all their own thing, taking all the open source, building this crazy stack that they need to had to do a lot of work we used to say. Chewing glass to be able to make it work right or anything, but it's still not as easy as you would like, almost no company that I talk to, if you're talking about big enterprises has Kubernetes just enterprise wide, and a hundred percent of their applications running on it. What is the tough challenge for people? And I mean, Dave, something, you and I have covered for many, many years, , that application portfolio that I have, most enterprises, hundreds, thousands of applications modernizing that having that truly be cloud native, that that's a really long journey and we are still in the midst of that, so I still still think we are in that, that if you look at the cross in the chasm that early majority chunk, so some of it is how do we mature things even better? And how do we make things simpler? Talk about things like automation, simplicity, security, we need to make sure they're all there so that it can be diffused and rolled out more broadly. And then we also need to think about where are we? We talk about the next million cloud customers, where does Kubernetes and containers and all the cloud native pieces fit into that broader discussion. Yes, there's some maturity there and we can declare victory on certain things, but there's still a lot, a lot of work that everyone's doing and that leads us into the show. I mean, dozens of projects that are already graduated, many more along that process from sandbox through a whole bunch of co-located events that are there, and it's always a great community event which Red Hat of course built on open source and community projects, so we're happy to have a good presence there as always. >> So you and I have talked about this in the past how essentially container's going to be embedded into a lot of different places, and sometimes it's hard to find, it's hard to track, but if you look at kind of the pre DevOps world skillsets like provisioning LANs, or configuring ports, or troubleshooting, squeezing more, server utilism, I mean, those who are really in high demand. If that's your skillset, then you're probably out of a job today. And so that's shifted toward things like Kubernetes. So you see and you see in the ETR data, it's along with cloud, and RPA, or automation, it is right up there I mean, it's top, the big four if you will, cloud, automation, RPA, and containers. And so we know there's a lot of spending activity going on there, but sometimes, like I said, it's hard to track I mean, if you got cloud growing at 35% a year, at least for the hyperscalers that we track, Kubernetes should be growing faster than that, should it not? >> Yeah, Dave, I would agree with you when I look at the big analyst firms that track this, I believe they've only got the container space at about a 25 per percent growth rate. >> Slower than cloud. But I compare that with Deepak Singh who runs at AWS, he has the open source office, he has all the containers and Kubernetes, and has visibility in all of that. And he says, basically, containers of the default when somebody's deploying to AWS today. Yes, serverless has its place, but it has not replaced or is not pushing down, slowing down the growth of containers or Kubernetes. We've got a strong partnership, I have lots of customers running on AWS. I guess I look at the numbers and like you, I would say that I would expect that that growth rate to be north of where just cloud in general is because the general adoption of containers and Kubernetes, we're still in the early phases of things. >> And I think a lot of the spendings Stu is actually in labor resources within companies and that's hard to track. Let's talk about what we should expect at the show. Obviously this whole notion of secure supply chain was a big deal last year in LA, what's hot? >> Yeah, so security Dave, absolutely. You said for years, it's a board level discussion, it's now something that really everyone in the organization has to know about the dev sec ops movement, has seen a lot of growth, secure supply chain, we're just trying to make sure that when I use open source, there's lots of projects, there is the huge ecosystem in marketplaces that are out there. So I want to make sure that as I grab all of the pieces that I know where they got came from the proper signature certification to make sure that the full solution that I build, I understand it. And if there are vulnerabilities, I know if there's an issue, how I patch it in the industry, we talk about CBEs, so those vulnerabilities, those exploits that come out, then everybody has to do a quick runaround to understand wait, hey, is my configuration? Am I vulnerable? Do I have to patch things? So security, absolutely still a huge, huge thing. Quick from a Red Hat standpoint, people might notice we made an acquisition a year ago of StackRox. That product itself also now has a completely fully open source project itself, also called StackRox. So the product is Red Hat advanced cluster security for Kubernetes, there's an open source equivalent for that called StackRox now, open source, community, there's a monthly office hour live streaming that a guy on my team actually does, and so there'll be a lot of activity at the show talking about security. So many other things happening at the show Dave. Another key area, you talked about the developers and what they want to worry about and what they don't. In the container space, there's a project called Knative. So Google helped create that, and that's to help me really have a serverless operational model, with still the containers and Kubernetes underneath that. So at the show, there will be the firs Knative con. And if you hadn't looked at Knative in a couple of years, one of the missing pieces that is now there is eventing. So if I look at functions and events, now that event capability is there, it's something I've talked to a lot of customers that were waiting for that to have it. It's not quite the same as like a Lambda, but is similar functionality that I can have with my containers in Kubernetes world. So that's an area that's there and so many others, I mean, GitOps are super hot at the last show. It's something that we've seen, really broad adoption since Argo CD went generally available last year, and lots of customers that are taking that to help them. That's both automation put together because I can allow GitHub to be my single source of truth for where I keep code, make sure I don't have any deviation from where the kind of the golden image if you will, it lives. >> So we're talking earlier about, how hard it is to track this stuff. So with the steep trajectory of growth and new customers coming on, there's got to be a lot of experimentation going on. That probably is being done, somebody downloads the open source code and starts playing with it. And then when they go to production that I would imagine Stu that's the point at which they say, hey, we need to fill some of these gaps. And they reach out to a company like yours and say, now we got to have certifications and trust., Do you. see that? >> So here's the big shift that happened, if we were looking four or five years ago, absolutely, I'd grab the open source code and some people might do that, but what cloud really enabled Dave, is rather than just grabbing, going to the dot the GitHub repo and pulling it down itself, I can go to the cloud so Microsoft, AWS, and Google all have their Kubernetes offering and I click a button. But that just gives me Kubernetes so there's still a steep learning curve. And as you said to build out out that full stack, that is one of the big things that we do with OpenShift is we take dozens of projects, pull them in together so you get a full platform. So you spend less time on curating, integrating, and managing that platform. And more time on the real value for your business, which is the application stack itself, the security and the like. And when we deliver OpenShift in the cloud, we have an SRE team that manages that for you. So one of the big challenges we have out there, there is a skillset gap, there are thousands of people getting certified on Kubernetes. There are, I think I saw over a hundred thousand job openings with Kubernetes mentioned in it, we just can't train people up fast enough, and the question I would have as an enterprise company is, if I'm going to the cloud, how much time do I want to build having SREs, having them focus on the infrastructure versus the things that are business specific. What did Amazon promise Dave? We're going to help you get rid of undifferentiated heavy lifting. Well, I just consume things as a service where I have an SRE team manage that environment. That might make more sense so that I can spend more time focusing on my business activities. That's a big focus that we've had on Red Hat, is our offerings that we have with the cloud providers to do and need offering. >> Yeah, the managed service capability is key. We saw, go back to the Hadoop days, we saw that's where Cloudera really struggled. They had to support every open source project. And then the customers largely had to figure it out themselves. Whereas you look at what data bricks did with spark. It was a managed service that was getting much greater adoption. So these complex areas, that's what you need. So people win sometimes when I use the term super cloud, and we getting little debates on Twitter, which is a lot of fun, but the idea is that you create the abstraction layer that spans your on-prem, your cloud, so you've got a hybrid. You want to go across clouds, what people call multi-cloud but as you know, I've sort of been skeptical of multi-cloud is really multi-vendor. But so we're talking about a substantial experience that's identical across those clouds and then ultimately out to the edge and we see a super Paas layer emerging, And people building on top of that, hiding the underlying complexity. What are your thoughts on that? How does Kubernetes in your view fit in? >> Yeah, it's funny, Dave, if you look at this container space at the beginning, Docker came out of a company called dotCloud. That was a PaaS company. And there's been so many times that that core functionality of how do I make my developers not have to worry about that underlying gank, but Dave, while the storage people might not have to worry about the LANs, somebody needs to understand how storage works, how networking works, if something breaks, how do I make sure I can take care of it. Sometimes that's a service that the SRE team manages that away from me. so that yes, there is something I don't need to think of about, but these are technically tough configurations. So first to one of your main questions, what do we see in customers with their hybrid and multi-cloud journey? So OpenShift over 10 years old, we started OpenShift before Kubernetes even was a thing. Lots of our customers run in what most people would consider hybrid, what does that mean? I have something in my data center, I have something in the cloud, OpenShift health, thanks to Kubernetes, I can have consistency for the developers, the operators, the security team, across those environments. Over the last few years, we've been doing a lot in the Kubernetes space as a whole, as the community, to get Kubernetes out to the edge. So one of the nice things, where do containers live Dave? Anywhere Linux does, is Linux going to be out of the edge? Absolutely, it can be a small footprint, we can do a lot with it. There were a lot of vendors that came out with it wasn't quite Kubernetes, they would strip certain things out or make a configuration that was smaller out at the edge, but a lot of times it was something that was just for a developer or something I could play with, and what it would break sometimes was that consistency out at the edge to what my other environments would like to have. And if I'm a company that needs consistency there. So take for example, if I have an AI workload where I need edge, and I need something in the cloud, or in my data center of consistency. So the easy use case that everybody thinks about is autonomous vehicles. We work with a lot of the big car manufacturers, I need to have when my developer build something, and often my training will be done either in the data center or in the public cloud, but I need to be able to push that out to the vehicle itself and let it run. We've actually even got Dave, we've got Kubernetes running up on the ISS. And you want to make sure that we have a consistency. >> The ultimate edge. >> Yeah, so I said, right, it's edge above and beyond the clouds even, we've gone to beyond. So that is something that the industry as a whole has been working at, from a Red Hat standpoint, we can take OpenShift to a really small footprint. Last year we launched was known as single node OpenShift. We have a project called micro shift, which is also fully open source that it has less pieces of the overall environment to be able to fit onto smaller and smaller devices there. But we want to be able to manage all of them consistently because you talked about multi cluster management. Well, what if I have thousands or 10 of thousands of devices out of the edge? I don't necessarily have network, I don't have people, I need to be able to do things from an automated standpoint. And that's where containers and Kubernetes really can shine. And where a lot of effort has been done in general and something specifically, we're working on it, Red Hat, we've had some great customers in the telecommunication space. Talk about like the 5G rollout with this, and industrial companies that need to be able to push out at the edge for these type of solutions. >> So you just kind of answered my next question, but I want to double click on it which was, if I'm in the cloud, why do I need you? And you touched on it because you've got primitives, and APIs, and AWS, Google, and Microsoft, they're different, if you're going to hide the underlying complexity of that, it takes a lot of RND and work, now extend that to a Tesla. You got to make it run there, different use case, but that's kind of what Linux and OpenShift are design to do, so double click on that. >> Yeah, so right. If I look at the discussion you've been having about super clouds is interesting because there are many companies that we work with that do live across multiple environments. So number one, if I'm a developer, if my company came to me and said, hey, you've got all your certifications and you got years of experience running on Amazon, well, we need you to go run over on Google. That developer might switch companies rather than switch clouds because they've got all of their knowledge and skillset, and it's a steep learning curve. So there's a lot of companies that work on, how can we give you tools and solutions that can live across those environments? So I know you mentioned companies like Snowflake, MongoDB, companies like Red Hat, HashiCorp, GitLab, also span all of those environments. There's a lot of work, Dave, to be different than not just, I say, I don't love the term like we're cloud agnostic, which would mean, well, you can use any cloud. >> You can run on any cloud. >> That's not what we're talking about. Look at the legacy that Red Hat has is, Red Hat has decades of running in every customer's data center and pick your X 86 server of choice. And we would have deep relationships when Dell, HP, IBM, Lenovo, you name it, comes out with a new piece of hardware that was different. We would have to make sure that the Linux primitives work from a Red Hat standpoint. Interesting Dave, we're now supporting OpenShift on Azure Stack Hub. And I talked to our head of product management, and I said, we've been running OpenShift in Azure for years, isn't Azure Stack Hub? Isn't that just Azure in your data center. He's like, yeah, but down at the operating system level, we had to change some flags and change some settings and things like that, so what do we know in IT? It's always the yeah, at the high level, it looks the same, it acts the same, it feels the same. >> Seamless. >> It's seamless in everything when you get down to the primitives level, sometimes that we need to be able to do that. I'll tell you Dave, there's things even when I look at A cloud, if I'm in US East One, or US West One, there actually could be some differences in what services are there or how things react, and so therefore we have a lot of deep work that goes into all of those environments, and it's not just Red Hat, we have a marketplace and an ecosystem, we want to make sure you've got API compatibility across all of those. So we are trying to help lift up this entire ecosystem and bring everybody along with it because you set it at the upfront, Kubernetes alone won't do it, oo one vendor gives you an entire, everything that you need for your developer tool chain. There's a lot that goes into this, and that's where we have deep commitment to partnerships. We build out and support lots of ecosystems. And this show itself is very much a community driven show. And, and therefore, that's why Red Hat has a strong presence at it, 'cause that's the open source community and everything that we built on. >> You guys are knee deep in it. You know I wrote down when you were talking about Snowflake and Mongo, HashiCorps, another one, I wrote down Dell, HP, Cisco, Lenovo, that to me, that should be their strategy. NetApp, their strategy should be to basically build out that abstraction layer, the so-called super cloud. So be interesting to see if they're going to be at this show. It requires a lot of R and D number one, number two, to your point, it requires an ecosystem. So you got all these guys, most of them now do in their own as a service, as a service is their own cloud. Their own cloud means you better have an ecosystem that's robust. I want to ask you about, do you ever think about what's next beyond Kubernetes? Or do you feel like, hey, there's just so much headroom in Kubernetes and so many active projects, we got ways to go. >> Yeah, so the Kubernetes itself Dave, should be able to fade into the background some. In many ways it does mirror what happened with Linux. So Linux is just the foundation of everything we have. We would not have the public cloud providers if it wasn't for Linux. I mean, Google, of course you wouldn't have without Linux, Amazon. >> Is on the internet. >> Right, but you might not have a lot of it. So Kubernetes, I think really goes the same way is, it is the foundational layer of what so much of it is built on top of it, and it's not really. So many people think about that portability. Oh, Google's the one that created it, and they wanted to make sure that it was easy if I want to go from the cloud provider that I had to use Kubernetes on Google cloud. And while that is a piece of it, that consistency is more important. And what I can build on top of it, it is really more of a distributed systems challenge that we are solving and that we've been working on in industry now for decades. So that is what we help solve, and what's really nice, containers and Kubernetes, it's less of an abstraction, it's more of new atomic unit of how we build things. So virtualization, I don't know what's underneath, and we spent like a decade fixing the storage networking components underneath so that the LANs matched right, and the network understood what was happening in the virtual machine. The atomic unit of a container, which is what Kubernetes manages is an application or a piece of an application. And therefore that there is less of an abstraction, more of just a rearchitecting of how we build things, and that is part of what is needed, and boy, Dave, the ecosystem, oh my God, yes, we've gone to only three releases a year, but I can tell you our roadmaps are all public on the internet and we talk heavily about them. There is still so many things that just at the basic Kubernetes piece, new architectures, arm devices are now in there, we're now supporting them, Kubernetes can support them too. So there are so many hardware pieces that are coming, so many software devices, the edge, we talked about it a bit, so there's so much that's going on. One of the areas that I love hearing about at the show, we have a community event called OpenShift Comments, which one of the main things of OpenShift Comments, is customers coming to talk about what they've been doing, and not about our products, we're talking about the projects and their journey overall. We've got a at Flenty Show, Airbus and Telefonica, are both going to be talking about what they're doing. We've seen Dave, every industry is going through their digital transformation journey. And it's great to hear straight from them what they're doing, and one of the big pieces in area, we actually spend a bunch of time on that application journey. There's a group of open source projects under what's known as Konveyor, that's conveyor with a K, Konveyor.io. It's modernization in migration. So how do I go from a VM to a container? How do I go from my data center to a cloud? How do I switch between services, open source projects to help with that journey? And, oh my gosh, Dave, I mean, you know in the cloud space, I mean that's what all the SIs and all the consultancies are throwing thousands of people at, is to help us get along that curve of that modernization journey. >> Okay, so let's see May 16th, the week of May 16th is KubeCon in Valencia Spain. theCUBE's going to be there, there was a little bit of a curfuffle on Twitter because the mask mandate was lifted in Spain and people had made plans thinking, okay, it's safe everybody's going to be wearing masks. Well, now I mean, you're going to have to make your own decisions on that front. I mean, you saw that you follow Twitter quite closely, but hey, this is the world we live in. So I'll give you the last word. >> Yeah, we'll see if Twitter still exists by the time we get to that show with. >> Could be private. What happens, but yeah, no, Dave, I'll be participating remotely, it is a hybrid event, so one of the things we'll be watching is, how many people are there in person LA was a pretty small show, core contributors, brought it back to some of the early days that you covered heavily from theCUBE standpoint, how Valencia will be? I know from Red Hat standpoint, we have people there, many of them from Europe, both speaking, we talked about many of the co-located events that are there, so a lot of pieces all participate remotely. So if you stop by the OpenShift commons event, I'll be part of the event just from a hybrid standpoint. And yeah, we've actually got the week before, we've got Red Hat Summit. So it's nice to actually to have back to back weeks. We'd had that a whole bunch of times before I remember, back to back weeks in Boston one year where we had both of those events and everything. That's definitely. >> Connective tissue. >> Keeps us busy there. You've got a whole bunch of travel going on. I'm not doing too much travel just yet, Dave, but it's good to see you and it's great to be connected with community. >> Yeah, so theCUBE will be there. John Furrier is hosting with Keith Townsend. So if you're in Valencia, definitely stop by. Stu thanks so much for coming into theCUBE Studios I appreciate it. >> Thanks, Dave. >> All right, and thank you for watching. We'll see you the week of May 16th in Valencia, Spain. (upbeat music)

(upbeat music) >> Oracle is in the midst of an acceleration of its product cycles. It really has pushed new capabilities across its database, the database platforms, and of course the cloud in an effort to really maintain its position as the gold standard for cloud database. We've reported pretty extensively on Exadata, most recently the X9M that increased database IOPS and throughput. Organizations running mission critical OLTP, analytics and mix workloads tell us that they've seen meaningfully improved performance and lower costs, which you expect in a technology cycle. I often say if Oracle calls you out by name it's a compliment and it means you've succeeded. So just a couple of weeks ago, Oracle turned up the heat on MongoDB with a Mongo compatible API, in an effort to persuade developers to run applications in a autonomous database and on OCI, Oracle cloud infrastructure. There was a big emphasis by Oracle on acid compliance transactions and automatic scaling as well as access to multiple data types. This caught my attention because in the early days of no SQL, there was a lot of chatter from folks about not needing acid capability in the database anymore. Funny how that comes around. And anyway, you see Oracle investing, they spend money in R&D We've always said that`, they're protecting their moat. Now in social I've seen some criticisms like Oracle still is not adding enough new logos, and Oracle of course will dispute that and give you some examples. But to me what's most impressive is the big name customers that Oracle gets to talk in public. Deutsche Bank, Telephonic, Experian, FedEx, I mean dozens and dozens and dozens. I work with a lot of companies and the quality of the customers Oracle puts in front of analysts like myself is very very high. At the top of the list I would say. And they're big spending customers. And as we said many times when it comes to mission critical workloads, Oracle is the king. And one of the executives behind the success is a longtime Cube alum, Juan Loaiza who's executive vice president of mission critical technologies at Oracle. And we've invited him back on today to talk about some news and Oracle's latest developments and database, Juan welcome back to the show and thanks for coming on today and talking about today's announcement. >> I'm very happy to be here today with you. >> Okay, so what are you announcing and how does this help organizations particularly with those existing Exadata cloud at customer installations? >> Yeah, the big thing we're announcing is our very successful cloud at customer platform. We're extending the capabilities of our autonomous database running on it. And specifically we're allowing much smaller configurations so customers can start small and grow with our autonomous database on our cloud customer platform. >> So let's get into granularity a little bit and double click on this. Can you go over how customers, carve up VM clusters for different workloads? What's the tangible benefit to them? >> Yeah, so it's pretty straightforward. We deploy our Cloud@Customer system anywhere the customer wants it, let's say in their data center. And then through our cloud APIs and GUIs they can carve up into pieces into basically VMs. They can say, Hey, I want a VM with eight CPUs to do this, I want a VM with 20 CPUs to that, I want a 500 CPUVM to do something else. And that's what we call a VM cluster because in Cloud@Customer, it is a highly available environment. So you don't just get one VM, you get a cluster of highly available VMs. So you carve it up. You hand it out to different aspects of a company. You might have development on one, testing on another one, some production sales on one VM, marketing on a different VM. And then you run your databases in there and that's kind of how it works and it's all done completely through our GUI and it's very, very simple 'cause they use it the same cloud APIs and GUIs that we use in the public cloud. It is the same APIs and GUIs that we use in the public cloud. >> Yeah, I was going to say sounds like cloud. So what about prerequisites? What do customers have to do to take advantage of the new capabilities? Can they run it on an Exadata cloud a customer that they installed a couple years ago? Do they have to upgrade the hardware? What migration pain is involved? >> Yeah, there's no pain, so it's just, (coughs) excuse me. I can take their existing system, they get our free software update and they can just deploy autonomous database as a VM in their existing Exadata cloud system. >> Oh nice okay what's the bottom line dollars? Our audience are always interested in cutting costs. It's one of the reasons they're moving to the cloud for example. So how does autonomous database on VM clusters, on Exadata Cloud at Customer? How does it help cut their cost? >> Well, it's pretty straightforward. So previous to this a customer would have to have dedicated a system to either autonomous database or to non autonomous data. So you have to choose one together. So on a system by system basis, you chose I want this thing autonomous, or I don't want it autonomous. Now you carve in the VMs and say for this VM I want that autonomous for that VM I want to run a regular database managed database on there. So lets customers now start small with any size they want. They could start with two CPUs and run an autonomous database and that's all they pay for is the two CPUs that they use. >> Let's talk a little about traction. I mean, I remember we covered the original Exadata announcement quite a long time ago and it's obviously evolved and taken many forms. Look, it's hard to argue that it hasn't been a big success. It has for Oracle and your target customers. Does this announcement make Exadata cloud a customer more attractive for smaller companies. In other words, does it expand the team for ADB? And if so, how? >> Yeah, absolutely. I mean our Exadata cloud platform is extremely successful. We have thousands of deployments, we have on our data platform we have about almost 90% of the global fortune 100 and thousands of smaller customers. In the cloud we have now up to 40% of the global 100 a hundred biggest companies in the world running on that. So it's been extremely successful platform and cloud a customer is super key. A lot of customers can't move their data to the public cloud. So we bring the public cloud to them with our cloud customer offering. And so that's the big customer is the fortune hundred but we have thousands of smaller customers also. And the nice thing about this offering is we can start with literally two CPUs. So we can be a very small customer and still run our autonomous data based on our cloud customer platform. >> Well, everybody cares about security and governance. I mean, especially the big guys, but the little guys that in many ways as well they want the capabilities of the large companies but they can't necessarily afford it. So I want to talk about security in particular governance and it's especially important for mission-critical apps. So how does this all change the security in governance paradigm? What do customers need to know there? >> Yeah, so the beauty of autonomous database which is the thing that we're talking about today is Oracle deals with all the security. So the OS, the hardware, firmware, VMs, the database itself all the interfaces to the VM, to the database all that is it's all done by Oracle. So, which is incredibly important because there's a constant stream of security alerts that are coming out and it's very difficult for customers to keep up with this stuff. I mean, it's hard for us and we have thousands of engineers. And so we take that whole burden away from customers. And you just don't have to think about it, we deal with it. So once you deploy an autonomous database it is always secure because anytime a security alert comes out, we will apply that and we do it in an online fashion also. So it's really, particularly for smaller customers it's even harder because to keep up with all the security that you you need a giant team of security experts and even the biggest customers struggle with that and a small customer's going to really struggle. There's just two, you have to look at the entire stack, all the different components switches, firmware, OS, VMs, database, everything. It's just very difficult to keep up. So we do it all and for small cut, they just can't do it. So really they really need to partner with a company like Oracle that has thousands of engineers that can keep up with this stuff. >> It's true what you say, even large customers this CSOs will tell you that lack of talent, lack of skill sets. They just don't have enough people and so even the big guys can't keep up. Okay, I want you to pitch me as though I'm a developer, which I'm not, but we got a lot of developers in our community. We'll be Cube con next month in Valencia, sell me on why a developer should lean into ADB on Exadata cloud as a customer? >> Yeah, it's very straightforward. So Oracle has the most advanced database in the industry and that's widely recognized by database analysts and experts in the field. Traditionally, it's been hard for a developer to use it because it's been hard to manage. It's been hard to set up, install, configure, patch, back up all that kind of stuff. Autonomous database does it all for you. So as a developer, you can just go into our console, click on creating a database. We ask you four questions, how big, how many CPUs how much storage and say, give your password. And within minutes you have a database. And at that point you can go crazy and just develop. And you don't have to worry about managing the database, patching the database, maintaining the security and the database backing up to all that stuff. You can instantly scale it. You can say, Hey, I want to grow it, you just click a button, take, grow it to much any size you want and you get all the mission critical capabilities. So it works for tiny databases but it is a stock exchange quality in terms of performance, availability, security it's a rock solid database that's super trivial. So what used to be a very complex thing is now completely trivial for a developer. So they get the best of both worlds, they get everything on the database side and it it's trivial for them to use. >> Wow, if you're doing all that stuff for 'em are they going to do on their weekends? Code? (chuckles) >> They should be developing their application and add value to their company that's kind of what they should focus on. And they can be looking at all sorts of new technologies like JSON and the database machine learning in the database graph in the database. So you can build very sophisticated applications because you don't have to worry about the database anymore. >> All right, let's talk about the competition. So it's always a topic I like to bring up with you. From a competitive perspective how is this latest and instantiation of Exadata cloud a customer X9M how's this different from running an AWS database service for instance on outpost, or let's say I want to run SQL server on Azure Stack or whatever Microsoft's calling it these days. Give us the competitive angle here. >> Yeah, there kind of is no real competition. So both Amazon and Microsoft have an at customer solution but they're very primitive. I mean, just to give you an example like Amazon doesn't run any of their premier database offerings at customers. So whether it's Aurora Redshift, doesn't run just plane does not run. It's not that it runs badly or it's got limited, just does not run. They can't run Oracle RDS on premise and same thing with Microsoft. They can't run Azure SQL, which is their premier database on their act customer platform. So that kind of tells you how limited that platform is when even their own premier offerings doesn't run on it. In contrast, we're running Exadata with our premier autonomous database. So it's our premier platform that's in use today by most of the biggest, banks, telecom to retailers et cetera in the world, thousands of smaller customers. So it's super mission critical, super proven with our premier cloud database, which is autonomous theory. So it couldn't be more black and white, this is a case where it's there really is no competition in the cloud of customer space on the database side. >> Okay, but let me follow up on that, Juan, if I may, so, okay. So it took you guys a while to get to the cloud, it's taken them a while to figure it on-prem. I mean, aren't they going to eventually sort of get there? What gives you confidence that you'll be able to to keep ahead? >> Well, there's two things, right? One is we've been doing this for a long time. I mean, that's what Oracle initially started as an on-prem and our Exadata platform has been available for over a decade. And we have a ton of experience on this. We run the biggest banks in the world already, it's not some hope for the future. This is what runs today. And our focus has always been a combination of cloud and on-prem their heart's not really in the on-prem stuff they really like. Amazon's really a public cloud only vendor and you can see from the result, it's not you can say, they can say whatever they want but you can see the results. Their outpost platform has been available for several years now and it still doesn't even run their own products. So you can kind of see how hard they're trying and how much they really care about this market. >> All right, boil it down if you just had a few things that you'd tell someone about why they should run ADB on Exadata cloud at customer, what would you say? >> It's pretty simple, which is it's the world's most sophisticated database made completely simple, that's it? So you get a stock exchange level database, you can start really small and grow and it's completely trivial to run because Oracle is automated everything within our autonomous data we use machine learning and a lot of automation to automate everything around the database. So it's kind of the best of both worlds. The best possible database starts as small as you want and is the simplest database in the world. >> So I probably should have asked you this while I was pushing the competitive question but this may be my last question, I promise. It's the age old debate It rages on, you got specialized databases kind of a right tool for the right job approach. That's clearly where Amazon is headed or what Oracle refers to is converge database. Oracle says its approach is more complete and "simpler." Take us through your thinking on this and the latest positioning so the audience can understand it a bit better. >> Yeah, so apps aren't what they used to business apps, data driven apps aren't what they used to be. They used to be kind of green screens where you just entered data. Now everyone's a very sophisticated app, they want to be have location, they want to have maps, they want to have graph in there. They want to have machine learning, they want machine learning built into the app. So they want JSON they want text, they want text search. So all these capabilities are what a modern app has to support. And so what Oracle's done is we provided a single solution that provides everything you need to build a modern app and it's all integrated together. It's all transactional. You have analytics built into the same thing. You have reporting built into the same thing. So it has everything you need to build a modern app. In contrast, what most of our competitors do is they give you these little solutions, say, okay here you do machine learning over here, you do analytics over there, you do JSON over here, you do spatial over here you do graph over there. And then it's left a developer to put an app together from all these pieces. So it's like getting the pieces of a card and having to assemble it yourself and then maintain it for the rest of your life, which is the even harder part. So one part upgrades, you got to test that. So of other piece upgrade or changes, you got to test that, you got to deal with all the security problems of all these different systems. You have to convert the data, you have to move the data back and forth it's extraordinarily complicated. Our converge database, the data sits in one place and all the algorithms come to the data. It's very simple, it is dramatically simpler. And then autonomous database is what makes managing it trivial. You don't really have to manage anything more because Oracle's automated the whole thing. >> So, Juan, we got a pretty good Cadence going here. I mean I really appreciate you coming on and giving us these little video exclusives. You can tell by again, that Cadence how frequently you guys are making new announcements. So that's great, congrats on yet another announcement. Thanks for coming back in the program appreciate it. >> Yeah, of course we invest heavily in data management. That's our core and we will continue to do that. I mean, we're investing billions of dollars a year and we intend to stay the leaders in this market. >> Great stuff and thank you for watching the Cube, your leader in enterprise tech coverage, this is Dave Vellante we'll see you next time.

(bright music) >> Hello, everyone, and welcome to this CUBE video exclusive. This is Dave Vellante, and as I've said many times what people sometimes forget is Oracle's chairman is also its CTO, and he understands and appreciates the importance of engineering. It's the lifeblood of tech innovation, and Oracle continues to spend money on R and D. Over the past decade, the company has evolved its Exadata platform by investing in core infrastructure technology. For example, Oracle initially used InfiniBand, which in and of itself was a technical challenge to exploit for higher performance. That was an engineering innovation, and now it's moving to RoCE to try and deliver best of breed performance by today's standards. We've seen Oracle invest in machine intelligence for analytics. It's converged OLTB and mixed workloads. It's driving automation functions into its Exadata platform for things like indexing. The point is we've seen a consistent cadence of improvements with each generation of Exadata, and it's no secret that Oracle likes to brag about the results of its investments. At its heart, Oracle develops database software and databases have to run fast and be rock solid. So Oracle loves to throw around impressive numbers, like 27 million AKI ops, more than a terabyte per second for analytics scans, running it more than a terabyte per second. Look, Oracle's objective is to build the best database platform and convince its customers to run on Oracle, instead of doing it themselves or in some other cloud. And because the company owns the full stack, Oracle has a high degree of control over how to optimize the stack for its database. So this is how Oracle intends to compete with Exadata, Exadata Cloud@Customer and other products, like ZDLRA against AWS Outposts, Azure Arc and do it yourself solutions. And with me, to talk about Oracle's latest innovation with its Exadata X9M announcement is Juan Loaiza, who's the Executive Vice President of Mission Critical Database Technologies at Oracle. Juan, thanks for coming on theCUBE, always good to see you, man. >> Thanks for having me, Dave. It's great to be here. >> All right, let's get right into it and start with the news. Can you give us a quick overview of the X9M announcement today? >> Yeah, glad to. So, we've had Exadata on the market for a little over a dozen years, and every year, as you mentioned, we make it better and better. And so this year we're introducing our X9M family of products, and as usual, we're making it better. We're making it better across all the different dimensions for OLTP, for analytics, lower costs, higher IOPs, higher throughputs, more capacity, so it's better all around, and we're introducing a lot of new software features as well that make it easier to use, more manageable, more highly available, more options for customers, more isolation, more workload consolidation, so it's our usual better and better every year. We're already way ahead of the competition in pretty much every metric you can name, but we're not sitting back. We have the pedal to the metal and we're keeping it there. >> Okay, so as always, you announced some big numbers. You're referencing them. I did in my upfront narrative. You've claimed double to triple digit performance improvements. Tell us, what's the secret sauce that allows you to achieve that magnitude of performance gain? >> Yeah, there's a lot of secret sauce in Exadata. First of all, we have custom designed hardware, so we design the systems from the top down, so it's not a generic system. It's designed to run database with a specific and sole focus of running database, and so we have a lot of technologies in there. Persistent memory is a really big one that we've introduced that enables super low response times for OLTP. The RoCE, the remote RDMA over convergency ethernet with a hundred gigabit network is a big thing, offload to storage servers is a big thing. The columnar processing of the storage is a huge thing, so there's a lot of secret sauce, most of it is software and hardware related and interesting about it, it's very unique. So we've been introducing more and more technologies and actually advancing our lead by introducing very unique, very effective technologies, like the ones I mentioned, and we're continuing that with our X9 generation. >> So that persistent memory allows you to do a right directly, atomic right directly to memory, and then what, you update asynchronously to the backend at some point? Can you double click on that a little bit? >> Yeah, so we use persistent memory as kind of the first tier of storage. And the thing about persistent memory is persistent. Unlike normal memory, it doesn't lose its contents when you lose power, so it's just as good as flash or traditional spinning disks in terms of storing data. And the integration that we do is we do what's called remote direct memory access, that means the hardware sends the new data directly into persistent memory and storage with no software, getting rid of all the software layers in between, and that's what enables us to achieve this extremely low latency. Once it's in persistent memory, it's stored. It's as good as being in flash or disc. So there's nothing else that we need to do. We do age things out of persistent memory to keep only hot data in there. That's one of the tricks that we do to make sure, because persistent memory is more expensive than flash or disc, so we tier it. So we age data in and out as it becomes hot, age it out as it becomes cold, but once it's in persistent memory, it's as good as being stored. It is stored. >> I love it. Flash is a slow tier now. So, (laughs) let's talk about what this-- >> Right, I mean persistent memory is about an order of magnitude faster. Flash is more than an order of magnitude faster than disk drive, so it is a new technology that provides big benefits, particularly for latency on OLTP. >> Great, thank you for that, okay, we'll get out of the plumbing. Let's talk about what this announcement means to customers. How does all this performance, and you got a lot of scale here, how does it translate into tangible results say, for a bank? >> Yeah, so there's a lot of ways. So, I mentioned performance is a big thing, always with Exadata. We're increasing the performance significantly for OLTP, analytics, so OLTP, 50, 60% performance improvements, analytics, 80% performance improvements in terms of costs, effectiveness, 30 to 60% improvement, so all of these things are big benefits. You know, one of the differences between a server product like Exadata and a consumer product is performance translates in the cost also. If I get a new smartphone that's faster, it doesn't actually reduce my costs, it just makes my experience a little better. But with a server product like Exadata, if I have 50% faster, I can translate that into I can serve 50% more users, 50% more workload, 50% more data, or I can buy a 50% smaller system to run the same workload. So, when we talk about performance, it also means lower costs, so if big customers of ours, like banks, telecoms, retailers, et cetera, they can take that performance and turn it into better response times. They can also take that performance and turn it into lower costs, and everybody loves both of those things, so both of those are big benefits for our customers. >> Got it, thank you. Now in a move that was maybe a little bit controversial, you stated flat out that you're not going to bother to compare Exadata cloud and customer performance against AWS Outposts and Azure Stack, rather you chose to compare to RDS, Redshift, Azure SQL. Why, why was that? >> Yeah, so our Exadata runs in the public cloud. We have Exadata that runs in Cloud@Customer, and we have Exadata that runs on Prem. And Azure and Azure Stack, they have something a little more similar to Cloud@Customer. They have where they take their cloud solutions and put them in the customer data center. So when we came out with our new X8, 9M Cloud@Customer, we looked at those technologies and honestly, we couldn't even come up with a good comparison with their equivalent, for example, AWS Outpost, because those products really just don't really run. For example, the two database products that Outposts promote or that Amazon promotes is Aurora for OLTP and Redshift for analytics. Well, those two can't even run at all on their Outposts product. So, it's kind of like beating up on a child or something. (laughs) It doesn't make sense. They're out of our weight class, so we're not even going to compare against them. So we compared what we run, both in public cloud and Cloud@Customer against their best product, which is the Redshifts and the Auroras in their public cloud, which is their most scalable available products. With their equivalent Cloud@Customer, not only does it not perform, it doesn't run at all. Their Premiere products don't run at all on those platforms. >> Okay, but RDS does, right? I think, and Redshift and Azure SQL, right, will run a their version, so you compare it against those. What were the results of the benchmarks when you did made those comparisons? >> Yeah, so compared against their public cloud or Cloud@Customer, we generally get results that are something like 50 times lower latency and close to a hundred times higher analytic throughput, so it's orders of magnitude. We're not talking 50%, we're talking 50 times, so compared to those products, there really is kind of, we're in a different league. It's kind of like they're the middle school little league and we're the professional team, so it's really dramatically different. It's not even in the same league. >> All right, now you also chose to compare the X9M performance against on-premises storage systems. Why and what were those results? >> Yeah, so with the on-premises, traditionally customers bought conventional storage and that kind of stuff, and those products have advanced quite a bit. And again, those aren't optimized. Those aren't designed to run database, but some customers have traditionally deployed those, you know, there's less and less these days, but we do get many times faster both on OLTP and analytic performance there, I mean, with analytics that can be up to 80 times faster, so again, dramatically better, but yeah, there's still a lot of on-premise systems, so we didn't want to ignore that fact and compare only to cloud products. >> So these are like to like in the sense that they're running the same level of database. You're not playing games in terms of the versioning, obviously, right? >> Actually, we're giving them a lot of the benefit. So we're taking their published numbers that aren't even running a database, and they use these low-level benchmarking tools to generate these numbers. So, we're comparing our full end-to-end database to storage numbers against their low-level IO tool that they've published in their data sheets, so again, we're trying to give them the benefit of the doubt, but we're still orders of magnitude better. >> Okay, now another claim that caught our attention was you said that 87% of the Fortune 100 organizations run Exadata, and you're claiming many thousands of other organizations globally. Can you paint a picture of the ICP, the Ideal Customer Profile for Exadata? What's a typical customer look like, and why do they use Exadata, Juan? >> Yeah, so the ideal customer is pretty straightforward, customers that care about data. That's pretty much it. (Dave laughs) If you care about data, if you care about performance of data, if you care about availability of data, if you care about manageability, if you care about security, those are the customers that should be looking strongly at Exadata, and those are the customers that are adopting Exadata. That's why you mentioned 87% of the global Fortune 100 have already adopted Exadata. If you look at a lot of industries, for example, pretty much every major bank almost in the entire world is running Exadata, and they're running it for their mission critical workloads, things like financial trading, regulatory compliance, user interfaces, the stuff that really matters. But in addition to the biggest companies, we also have thousands of smaller companies that run it for the same reason, because their data matters to them, and it's frankly the best platform, which is why we get chosen by these very, very sophisticated customers over and over again, and why this product has grown to encompass most of the major corporations in the world and governments also. >> Now, I know Deutsche bank is a customer, and I guess now an engineering partner from the announcement that I saw earlier this summer. They're using Cloud@Customer, and they're collaborating on things like security, blockchain, machine intelligence, and my inference is Deutsch Bank is looking to build new products and services that are powered by your platforms. What can you tell us about that? Can you share any insights? Are they going to be using X9M, for example? >> Yes, Deutsche Bank is a partnership that we announced a few months ago. It's a major partnership. Deutsche Bank is one of the biggest banks in the world. They traditionally are an on-premises customer, and what they've announced is they're going to move almost the entire database estate to our Exadata Cloud@Customer platform, so they want to go with a cloud platform, but they're big enough that they want to run it in their own data center for certain regulatory reasons. And so, the announcement that we made with them is they're moving the vast bulk of their data estate to this platform, including their core banking, regulatory applications, so their most critical applications. So, obviously they've done a lot of testing. They've done a lot of trials and they have the confidence to make this major transition to a cloud model with the Exadata Cloud@Customer solution, and we're also working with them to enhance that product and to work in various other fields, like you mentioned, machine learning, blockchain, that kind of project also. So it's a big deal when one of the biggest, most conservative, best respected financial institution in the world says, "We're going all in on this product," that's a big deal. >> Now outside of banking, I know a number of years ago, I stumbled upon an installation or a series of installations that Samsung found out about them as a customer. I believe it's now public, but they've something like 300 Exadatas. So help us understand, is it common that customers are building these kinds of Exadata farms? Is this an outlier? >> Yeah, so we have many large customers that have dozens to hundreds of Exadatas, and it's pretty simple, they start with one or two, and then they see the benefits, themselves, and then it grows. And Samsung is probably the biggest, most successful and most respected electronics company in the world. They are a giant company. They have a lot of different sub units. They do their own manufacturing, so manufacturing's one of their most critical applications, but they have lots of other things they run their Exadata for. So we're very happy to have them as one of our major customers that run Exadata, and by the way, Exadata again, very huge in electronics, in manufacturing. It's not just banking and that kind of stuff. I mean, manufacturing is incredibly critical. If you're a company like Samsung, that's your bread and butter. If your factory stops working, you have huge problems. You can't produce products, and you will want to improve the quality. You want to improve the tracking. You want to improve the customer service, all that requires a huge amount of data. Customers like Samsung are generating terabytes and terabytes of data per day from their manufacturing system. They track every single piece, everything that happens, so again, big deal, they care about data. They care deeply about data. They're a huge Exadata customer. That's kind of the way it works. And they've used it for many years, and their use is growing and growing and growing, and now they're moving to the cloud model as well. >> All right, so we talked about some big customers and Juan, as you know, we've covered Exadata since its inception. We were there at the announcement. We've always stressed the fit in our research with mission critical workloads, which especially resonates with these big customers. My question is how does Exadata resonate with the smaller customer base? >> Yeah, so we talk a lot about the biggest customers, because honestly they have the most critical requirements. But, at some level they have worldwide requirements, so if one of the major financial institutions goes down, it's not just them that's affected, that reverberates through the entire world. There's many other customers that use Exadata. Maybe their application doesn't stop the world, but it stops them, so it's very important to them. And so one of the things that we've introduced in our Cloud@Customer and public cloud Exadata platforms is the ability for Oracle to manage all the infrastructure, which enables smaller customers that don't have as much IT sophistication to adopt these very mission critical technology, so that's one of the big advancements. Now, we've always had smaller customers, but now we're getting more and more. We're getting universities, governments, smaller businesses adopting Exadata, because the cloud model for adopting is dramatically simpler. Oracle does all the administration, all the low-level stuff. They don't have to get involved in it at all. They can just use the data. And, on top of that comes our autonomous database, which makes it even easier for smaller customers to adapt. So Exadata, which some people think of as a very high-end platform in this cloud model, and particularly with autonomous databases is very accessible and very useful for any size customer really. >> Yeah, by all accounts, I wouldn't debate Exadata has been a tremendous success. But you know, a lot of customers, they still prefer to roll their own, do it themselves, and when I talk to them and ask them, "Okay, why is that?" They feel it limits their reliance on a single vendor, and it gives them better ability to build what I call a horizontal infrastructure that can support say non-Oracle workloads, so what do you tell those customers? Why should those customers run Oracle database on Exadata instead of a DIY infrastructure? >> Yeah, so that debate has gone on for a lot of years. And actually, what I see, there's less and less of that debate these days. You know, initially customers, many customers, they were used to building their own. That's kind of what they did. They were pretty good at it. What we have shown customers, and when we talk about these major banks, those are the kinds of people that are really good at it. They have giant IT departments. If you look at a major bank in the world, they have tens of thousands of people in their IT departments. These are gigantic multi-billion dollar organizations, so they were pretty good at this kind of stuff. And what we've shown them is you can't build this yourself. There's so much software that we've written to integrate with the database that you just can't build yourself, it's not possible. It's kind of like trying to build your own smartphone. You really can't do it, the scale, the complexity of the problem. And now as the cloud model comes in, customers are realizing, hey, all this attention to building my own infrastructure, it's kind of last decade, last century. We need to move on to more of an as a service model, so we can focus on our business. Let enterprises that are specialized in infrastructure, like Oracle that are really, really good at it, take care of the low-level details, and let me focus on things that differentiate me as a business. It's not going to differentiate them to establish their own storage for database. That's not a differentiator, and they can't do it nearly as well as we can, and a lot of that is because we write a lot of special technology and software that they just can't do themselves, it's not possible. It's just like you can't build your own smartphone. It's just really not possible. >> Now, another area that we've covered extensively, we were there at the unveiling, as well is ZDLRA, Zero Data Loss Recovery Appliance. We've always liked this product, especially for mission critical workloads, we're near zero data loss, where you can justify that. But while we always saw it as somewhat of a niche market, first of all, is that fair, and what's new with ZDLRA? >> Yeah ZDLRA has been in the market for a number of years. We have some of the biggest corporations in the world running on that, and one of the big benefits has been zero data loss, so again, if you care about data, you can't lose data. You can't restore to last night's backup if something happens. So if you're a bank, you can't restore everybody's data to last night. Suppose you made a deposit during the day. They're like, "Hey, sorry, Mr. Customer, your deposit, "well, we don't have any record of it anymore, "'cause we had to restore to last night's backup," you know, that doesn't work. It doesn't work for airlines. It doesn't work for manufacturing. That whole model is obsolete, so you need zero data loss, and that's why we introduced Zero Data Loss Recovery Appliance, and it's been very successful in the market. In addition to zero data loss, it actually provides much faster restore, much more reliable restores. It's more scalable, so it has a lot of advantages. With our X9M generation, we're introducing several new capabilities. First of all, it has higher capacity, so we can store more backups, keep data for longer. Another thing is we're actually dropping the price of the entry-level configuration of ZDLRA, so it makes it more affordable and more usable by smaller businesses, so that's a big deal. And then the other thing that we're hearing a lot about, and if you read the news at all, you hear a lot about ransomware. This is a major problem for the world, cyber criminals breaking into your network and taking the data ransom. And so we've introduced some, we call cyber vault capabilities in ZDLRA. They help address this ransomware issue that's kind of rampant throughout the world, so everybody's worried about that. There's now regulatory compliance for ransomware that particularly financial institutions have to conform to, and so we're introducing new capabilities in that area as well, which is a big deal. In addition, we now have the ability to have multiple ZDLRAs in a large enterprise, and if something happens to one, we automatically fail over backups to another. We can replicate across them, so it makes it, again, much more resilient with replication across different recovery appliances, so a lot of new improvements there as well. >> Now, is an air gap part of that solution for ransomware? >> No, air gap, you really can't have your back, if you're continuously streaming changes to it, you really can't have an air gap there, but you can protect the data. There's a number of technologies to protect the data. For example, one of the things that a cyber criminal wants to do is they want to take control of your data and then get rid of your backup, so you can't restore them. So as a simple example of one thing we're doing is we're saying, "Hey, once we have the data, "you can't delete it for a certain amount of days." So you might say, "For the 30 days, "I don't care who you are. "I don't care what privileges you have. "I don't care anything, I'm holding onto that data "for at least 30 days," so for example, a cyber criminal can't come in and say, "Hey, I'm going to get into the system "and delete that stuff or encrypt it," or something like that. So that's a simple example of one of the things that the cyber vault does. >> So, even as an administrator, I can't change that policy? >> That's right, that's one of the goals is doesn't matter what privileges you have, you can't change that policy. >> Does that eliminate the need for an air gap or would you not necessarily recommend, would you just have another layer of protection? What's your recommendation on that to customers? >> We always recommend multiple layers of protection, so for example, in our ZDLRA, we support, we offload tape backups directly from the appliance, so a great way to protect the data from any kind of thing is you put it on a tape, and guess what, once that tape drive is filed away, I don't care what cyber criminal you are, if you're remote, you can't access that data. So, we always promote multiple layers, multiple technologies to protect the data, and tape is a great way to do that. We can also now archive. In addition to tape, we can now archive to the public cloud, to our object storage servers. We can archive to what we call our ZFS appliance, which is a very low cost storage appliance, so there's a number of secondary archive copies that we offload and implement for customers. We make it very easy to do that. So, yeah, you want multiple layers of protection. >> Got it, okay, your tape is your ultimate air gap. ZDLRA is your low RPO device. You've got cloud kind of in the middle, maybe that's your cheap and deep solution, so you have some options. >> Juan: Yes. >> Okay, last question. Summarize the announcement, if you had to mention two or three takeaways from the X9M announcement for our audience today, what would you choose to share? >> I mean, it's pretty straightforward. It's the new generation. It's significantly faster for OLTP, for analytics, significantly better consolidation, more cost-effective. That's the big picture. Also there's a lot of software enhancements to make it better, improve the management, make it more usable, make it better disaster recovery. I talked about some of these cyber vault capabilities, so it's improved across all the dimensions and not in small ways, in big ways. We're talking 50% improvement, 80% improvements. That's a big change, and also we're keeping the price the same, so when you get a 50 or 80% improvement, we're not increasing the price to match that, so you're getting much better value as well. And that's pretty much what it is. It's the same product, even better. >> Well, I love this cadence that we're on. We love having you on these video exclusives. We have a lot of Oracle customers in our community, so we appreciate you giving us the inside scope on these announcements. Always a pleasure having you on theCUBE. >> Thanks for having me. It's always fun to be with you, Dave. >> All right, and thank you for watching. This is Dave Vellante for theCUBE, and we'll see you next time. (bright music)

(upbeat music) >> Narrator: From around the globe. It's theCUBE with digital coverage of IBM Think 2021. Brought to you by IBM. >> Welcome back to theCUBE coverage of IBM. Think 2021 virtual. I'm John Furrier, host of theCUBE. And this is theCUBE virtual and Uli Homann who's here Corporate Vice President, of cloud and AI at Microsoft. Thanks for coming on. I love this session, obviously, Microsoft one of the big clouds. Awesome. You guys partnering with IBM here at IBM Think. First of all, congratulations on all the success with Azure and just the transformation of IBM. I mean, Microsoft's Cloud has been phenomenal and hybrid is spinning perfectly into the vision of what enterprises want. And this has certainly been a great tailwind for everybody. So congratulations. So for first question, thanks for coming on and tell us the vision for hybrid cloud for Microsoft. It's almost like a perfect storm. >> Yeah. Thank you, John. I really appreciate you hosting me here and asking some great questions. We certainly appreciate it being part of IBM Think 2021 virtual. Although I do wish to see some people again, at some point. From our perspective, hybrid computing has always been part of the strategy that Microsoft as policed. We didn't think that public cloud was the answer to all questions. We always believed that there is multiple scenarios where either safety latency or other key capabilities impeded the usage of public cloud. Although we will see more public cloud scenarios with 5G and other capabilities coming along. Hybrid computing will still be something that is important. And Microsoft has been building capabilities on our own as a first party solution like Azure Stack and other capabilities. But we also partnering with VMware and others to effectively enable investment usage of capabilities that our clients have invested in to bring them forward into a cloud native application and compute model. So Microsoft is continuing investing in hybrid computing and we're taking more and more Azure capabilities and making them available in a hybrid scenario. For example, we took our entire database Stack SQL Server PostgreSQL and recently our Azure machine learning capabilities and make them available on a platform so that clients can run them where they need them in a factory in on-premise environment or in another cloud for example, because they trust the Microsoft investments in relational technology or machine learning. And we're also extending our management capabilities that Azure provides and make them available for Kubernetes virtual machine and other environments wherever they might run. So we believe that bringing Azure capabilities into our clients is important and taking also the capabilities that our clients are using into Azure and make it available so that they can manage them end to end is a key element of our strategy. >> Yeah. Thanks Uli for sharing that, I really appreciate that. You and I have been in this industry for a while. And you guys have a good view on this how Microsoft's got perspective riding the wave from the original computer industry. I remember during the client server days in the 80s, late 80s to early 90s the open systems interconnect was a big part of opening up the computer industry that was networking, internetworking and really created more lans and more connections for PCs, et cetera. And the world just went on from there. Similar now with hybrid cloud you're seeing that same kind of vibe. You seeing the same kind of alignment with distributed computing architectures for businesses where now you have, it's not just networking and plumbing and connecting lans and PCs and printers. It's connecting everything. It's almost kind of a whole another world but similar movie, if you will. So this is really going to be good for people who understand that market. IBM does, you guys do. Talk about the alignment between IBM and Microsoft in this new hybrid cloud space? It's really kind of now standardized but yet it's just now coming. >> Yeah. So again, fantastic question. So the way I think about this is first of all, Microsoft and IBM are philosophically very much aligned. We're both investing in key open source initiatives like the Cloud Native Computing Foundation, CNCF something that we both believe in. We are both partnering with the Red Hat organizations. So Red Hat forms a common bond if you still want to between Microsoft and IBM. And again, part of this is how can we establish a system of capabilities that every client has access to and then build on top of that stack. And again, IBM does this very well with their cloud packs which are coming out now with data and AI and others. And again, as I mentioned before we're investing in similar capabilities to make sure that core Azure functions are available on that CNCF cloud environment. So open source, open standards are key elements. And then you mentioned something critical which I believe is misunderstood but certainly not appreciated enough is, this is about connectivity between businesses. And so part of the power of the IBM perspective together with Microsoft is bringing together key business applications for healthcare, for retail, for manufacturing and really make them work together so that our clients that are critical scenarios get the support they need from both IBM as well as Microsoft on top of this common foundation of the CNCF and other open standards. >> It's interesting. I love that point. I'm going to double down and amplify that late and continue to bring it up. Connecting between businesses is one thread. But now people, because you have an edge, that's also industrial business but also people. People are participating in open source. People have wearables, people are connected. And also they're connecting with collaboration. So this kind of brings a whole 'nother architecture which I want to get into the solutions with you on on how you see that playing out. But first I know, you're a veteran with Microsoft for many, many years of decades. Microsoft's core competency has been ecosystems developer ecosystems, customer ecosystems. Today, that the services motion is built around ecosystems. You guys have that playbook IBM's well versed in it as well. How does that impact your partnerships, your solutions and how you deal with down this open marketplace? >> Well, let's start with the obvious. Obviously Microsoft and IBM will work together in common ecosystem. Again, I'm going to reference the CNCF again as the foundation for a lot of these initiatives. But then we're also working together in the ed hat ecosystem because Red Hat has built an ecosystem and Microsoft and IBM are players in that ecosystem. However, we also are looking a higher level there's a lot of times when people think ecosystems it's fairly low level technology. But Microsoft and IBM are talking about partnerships that are focused on industry scenarios. Again retail, for example, or healthcare and others where we're building on top of these lower level ecosystem capabilities and then bringing together the solution scenarios where the strength of IBM capabilities is coupled with Microsoft capabilities to drive this very famous one plus one equals three. And then the other piece that I think we both agree on is the open source ecosystem for software development and software development collaboration and GitHub is a common anchor that we both believe can feed the world's economy with respect to the software solutions that are needed to really bring the capabilities forward, help improve the wealth economy and so forth by effectively bringing together brilliant minds across the ecosystem. And again, just Microsoft and IBM bringing some people but the rest of the world obviously participating in that as well. So thinking again, open source, open standards and then industry specific collaboration and capabilities being a key part. You mentioned people. We certainly believe that people play a key role in software developers and the get hub notion being a key one. But there are others where, again, Microsoft with Microsoft 365 has a lot of capabilities in connecting people within the organization and across organizations. And while we're using zoom here, a lot of people are utilizing teams because teams is on the one side of collaboration platform. But on the other side is also an application host. And so bringing together people collaboration supported and powered by applications from IBM from Microsoft and others is going to be, I think a huge differentiation in terms of how people interact with software in the future. >> Yeah, and I think that whole joint development is a big part of this new people equation where it's not just partnering in market, it's also at the tech and you got open source and just phenomenal innovation, a formula there. So let's ask what solutions here. I want to get into some of the top solutions you're doing with Microsoft and maybe with IBM, but your title is corporate vice president of cloud and AI come on, cause you get a better department. I mean, more relevant than that. I mean, it's exciting. Your cloud-scale is driving tons of innovation. AI is eating software, changing the software paradigm. We can see that playing out. I've done dozens of interviews just in this past month on how AI is more certainly with machine learning and having a control plane with data, changing the game. So tell us what are the hot solutions for hybrid cloud? And why is this a different ball game than say public cloud? >> Well, so first of all let's talk a little bit about the AI capabilities and data because I think there are two categories. You're seeing an evolution of AI capabilities that are coming out. And again, I just read IBM's announcement about integrating the cloud pack with IBM Satellite. I think that's a key capability that IBM is putting out there and we're partnering with IBM in two directions there. Making it run very well on Azure with our Red Hat partners. But on the other side, also thinking through how we can optimize the experience for clients that choose Azure as their platform and IBM cloud Pak for data and AI as their technology, but that's a technology play. And then the next layer up is again, IBM has done a fantastic job to build AI capabilities that are relevant for industries. Healthcare being a very good example. Again, retail being another one. And I believe Microsoft and IBM will work on both partnerships on the technology side as well as the AI usage in specific verticals. Microsoft is doing similar things within our dynamics product line. We're using AI for business applications for planning, scheduling, optimizations, risk assessments those kinds of scenarios. And of course we're using those in the Microsoft 365 environment as well. I always joke that despite my 30 years at Microsoft, I still don't know how to read or use PowerPoint. And I can't do a PowerPoint slide for the life of me but with a new designer, I can actually get help from the system to make beautiful PowerPoint happen. So bringing AI into real life usage I think is the key part. The hybrid scenario is critical here as well. And especially when you start to think about real life scenarios, like safety, worker safety in a critical environment, freshness of product we're seeing retailers deploying cameras and AI inside the retail stores to effectively make sure that the shelves are stocked. That the quality of the vegetables for example, continues to be high and monitored. And previously people would do this on a occasional basis running around in the store. Now the store is monitored 24/7 and people get notified when things need fixing. Another really cool scenario set, is quality. We're working with a finished steel producer that effectively is looking at the stainless steel as it's being produced. And they have cameras on this steel that look at specific marks. And if these marks show up, then they know that the stainless steel will be bad. And I don't know if you've looked at a manufacturing process, but the earlier they can get a failure detected the better it is because they can most likely or more often than not return the product back into the beginning of the funnel and start over. And that's what they're using. So you can see molten steel, logically speaking with a camera and AI. And previously humans did this which is obviously a less reliable and be dangerous because this is very, very hot. This is very blowing steel. And so increasing safety while at the same time, improving the quality is something that we see hybrid scenarios. Again, autonomous driving, another great scenario where perception AI is going to be utilized. So there's a bunch of capabilities out there that really are hybrid in nature and will help us move forward with key scenarios, safety, quality and autonomous behaviors like driving and so forth. >> Uli, great insight, great product vision great alignment with IBM's hybrid cloud space with all customers are looking for now and certainly multi-cloud around the horizon. So great to have you on, great agility and congratulations for your continued success. You got great area cloud and AI and we'll be keeping in touch. I'd love to do a deep dive sometime. Thanks for coming on. >> John, thank you very much for the invitation and great questions. Great interview. Love it. Appreciate it. >> Okay, CUBE coverage here at IBM Think 2021 virtual. I'm John Furrier, your host. Thanks for watching. (upbeat music)

>> Okay, we're now going to explore the vision of the future of cloud computing from the perspective of one of the leaders in the field, JG Chirapurath is the Vice President of Azure Data AI and Edge at Microsoft. JG, welcome to theCUBE on Cloud, thanks so much for participating. >> Well, thank you, Dave. And it's a real pleasure to be here with you and just want to welcome the audience as well. >> Well, JG, judging from your title, we have a lot of ground to cover and our audience is definitely interested in all the topics that are implied there. So let's get right into it. We've said many times in theCUBE that the new innovation cocktail comprises machine intelligence or AI applied to troves of data with the scale of the cloud. It's no longer we're driven by Moore's law. It's really those three factors and those ingredients are going to power the next wave of value creation in the economy. So first, do you buy into that premise? >> Yes, absolutely. We do buy into it and I think one of the reasons why we put data analytics and AI together, is because all of that really begins with the collection of data and managing it and governing it, unlocking analytics in it. And we tend to see things like AI, the value creation that comes from AI as being on that continuum of having started off with really things like analytics and proceeding to be machine learning and the use of data in interesting ways. >> Yes, I'd like to get some more thoughts around data and how you see the future of data and the role of cloud and maybe how Microsoft strategy fits in there. I mean, your portfolio, you've got SQL Server, Azure SQL, you got Arc which is kind of Azure everywhere for people that aren't familiar with that you got Synapse which course does all the integration, the data warehouse and it gets things ready for BI and consumption by the business and the whole data pipeline. And then all the other services, Azure Databricks, you got you got Cosmos in there, you got Blockchain, you've got Open Source services like PostgreSQL and MySQL. So lots of choices there. And I'm wondering, how do you think about the future of cloud data platforms? It looks like your strategy is right tool for the right job. Is that fair? >> It is fair, but it's also just to step back and look at it. It's fundamentally what we see in this market today, is that customers they seek really a comprehensive proposition. And when I say a comprehensive proposition it is sometimes not just about saying that, "Hey, listen "we know you're a sequence of a company, "we absolutely trust that you have the best "Azure SQL database in the cloud. "But tell us more." We've got data that is sitting in Hadoop systems. We've got data that is sitting in PostgreSQL, in things like MongoDB. So that open source proposition today in data and data management and database management has become front and center. So our real sort of push there is when it comes to migration management modernization of data to present the broadest possible choice to our customers, so we can meet them where they are. However, when it comes to analytics, one of the things they ask for is give us lot more convergence use. It really, it isn't about having 50 different services. It's really about having that one comprehensive service that is converged. That's where things like Synapse fits in where you can just land any kind of data in the lake and then use any compute engine on top of it to drive insights from it. So fundamentally, it is that flexibility that we really sort of focus on to meet our customers where they are. And really not pushing our dogma and our beliefs on it but to meet our customers according to the way they've deployed stuff like this. >> So that's great. I want to stick on this for a minute because when I have guests on like yourself they never want to talk about the competition but that's all we ever talk about. And that's all your customers ever talk about. Because the counter to that right tool for the right job and that I would say is really kind of Amazon's approach is that you got the single unified data platform, the mega database. So it does it all. And that's kind of Oracle's approach. It sounds like you want to have your cake and eat it too. So you got the right tool with the right job approach but you've got an integration layer that allows you to have that converged database. I wonder if you could add color to that and confirm or deny what I just said. >> No, that's a very fair observation but I'd say there's a nuance in what I sort of described. When it comes to data management, when it comes to apps, we have then customers with the broadest choice. Even in that perspective, we also offer convergence. So case in point, when you think about cosmos DB under that one sort of service, you get multiple engines but with the same properties. Right, global distribution, the five nines availability. It gives customers the ability to basically choose when they have to build that new cloud native app to adopt cosmos DB and adopt it in a way that is an choose an engine that is most flexible to them. However, when it comes to say, writing a SequenceServer for example, if modernizing it, you want sometimes, you just want to lift and shift it into things like IS. In other cases, you want to completely rewrite it. So you need to have the flexibility of choice there that is presented by a legacy of what sits on premises. When you move into things like analytics, we absolutely believe in convergence. So we don't believe that look, you need to have a relational data warehouse that is separate from a Hadoop system that is separate from say a BI system that is just, it's a bolt-on. For us, we love the proposition of really building things that are so integrated that once you land data, once you prep it inside the Lake you can use it for analytics, you can use it for BI, you can use it for machine learning. So I think, our sort of differentiated approach speaks for itself there. >> Well, that's interesting because essentially again you're not saying it's an either or, and you see a lot of that in the marketplace. You got some companies you say, "No, it's the data lake." And others say "No, no, put it in the data warehouse." And that causes confusion and complexity around the data pipeline and a lot of cutting. And I'd love to get your thoughts on this. A lot of customers struggle to get value out of data and specifically data product builders are frustrated that it takes them too long to go from, this idea of, hey, I have an idea for a data service and it can drive monetization, but to get there you got to go through this complex data life cycle and pipeline and beg people to add new data sources and do you feel like we have to rethink the way that we approach data architecture? >> Look, I think we do in the cloud. And I think what's happening today and I think the place where I see the most amount of rethink and the most amount of push from our customers to really rethink is the area of analytics and AI. It's almost as if what worked in the past will not work going forward. So when you think about analytics only in the enterprise today, you have relational systems, you have Hadoop systems, you've got data marts, you've got data warehouses you've got enterprise data warehouse. So those large honking databases that you use to close your books with. But when you start to modernize it, what people are saying is that we don't want to simply take all of that complexity that we've built over, say three, four decades and simply migrate it en masse exactly as they are into the cloud. What they really want is a completely different way of looking at things. And I think this is where services like Synapse completely provide a differentiated proposition to our customers. What we say there is land the data in any way you see, shape or form inside the lake. Once you landed inside the lake, you can essentially use a Synapse Studio to prep it in the way that you like. Use any compute engine of your choice and operate on this data in any way that you see fit. So case in point, if you want to hydrate a relational data warehouse, you can do so. If you want to do ad hoc analytics using something like Spark, you can do so. If you want to invoke Power BI on that data or BI on that data, you can do so. If you want to bring in a machine learning model on this prep data, you can do so. So inherently, so when customers buy into this proposition, what it solves for them and what it gives to them is complete simplicity. One way to land the data multiple ways to use it. And it's all integrated. >> So should we think of Synapse as an abstraction layer that abstracts away the complexity of the underlying technology? Is that a fair way to think about it? >> Yeah, you can think of it that way. It abstracts away Dave, a couple of things. It takes away that type of data. Sort of complexities related to the type of data. It takes away the complexity related to the size of data. It takes away the complexity related to creating pipelines around all these different types of data. And fundamentally puts it in a place where it can be now consumed by any sort of entity inside the Azure proposition. And by that token, even Databricks. You can in fact use Databricks in sort of an integrated way with the Azure Synapse >> Right, well, so that leads me to this notion of and I wonder if you buy into it. So my inference is that a data warehouse or a data lake could just be a node inside of a global data mesh. And then it's Synapse is sort of managing that technology on top. Do you buy into that? That global data mesh concept? >> We do and we actually do see our customers using Synapse and the value proposition that it brings together in that way. Now it's not where they start, oftentimes when a customer comes and says, "Look, I've got an enterprise data warehouse, "I want to migrate it." Or "I have a Hadoop system, I want to migrate it." But from there, the evolution is absolutely interesting to see. I'll give you an example. One of the customers that we're very proud of is FedEx. And what FedEx is doing is it's completely re-imagining its logistics system. That basically the system that delivers, what is it? The 3 million packages a day. And in doing so, in this COVID times, with the view of basically delivering on COVID vaccines. One of the ways they're doing it, is basically using Synapse. Synapse is essentially that analytic hub where they can get complete view into the logistic processes, way things are moving, understand things like delays and really put all of that together in a way that they can essentially get our packages and these vaccines delivered as quickly as possible. Another example, it's one of my favorite. We see once customers buy into it, they essentially can do other things with it. So an example of this is really my favorite story is Peace Parks initiative. It is the premier of white rhino conservancy in the world. They essentially are using data that has landed in Azure, images in particular to basically use drones over the vast area that they patrol and use machine learning on this data to really figure out where is an issue and where there isn't an issue. So that this part with about 200 radios can scramble surgically versus having to range across the vast area that they cover. So, what you see here is, the importance is really getting your data in order, landing consistently whatever the kind of data it is, build the right pipelines, and then the possibilities of transformation are just endless. >> Yeah, that's very nice how you worked in some of the customer examples and I appreciate that. I want to ask you though that some people might say that putting in that layer while you clearly add simplification and is I think a great thing that there begins over time to be a gap, if you will, between the ability of that layer to integrate all the primitives and all the piece parts, and that you lose some of that fine grain control and it slows you down. What would you say to that? >> Look, I think that's what we excel at and that's what we completely sort of buy into. And it's our job to basically provide that level of integration and that granularity in the way that it's an art. I absolutely admit it's an art. There are areas where people crave simplicity and not a lot of sort of knobs and dials and things like that. But there are areas where customers want flexibility. And so I think just to give you an example of both of them, in landing the data, in consistency in building pipelines, they want simplicity. They don't want complexity. They don't want 50 different places to do this. There's one way to do it. When it comes to computing and reducing this data, analyzing this data, they want flexibility. This is one of the reasons why we say, "Hey, listen you want to use Databricks. "If you're buying into that proposition. "And you're absolutely happy with them, "you can plug it into it." You want to use BI and essentially do a small data model, you can use BI. If you say that, "Look, I've landed into the lake, "I really only want to use ML." Bring in your ML models and party on. So that's where the flexibility comes in. So that's sort of that we sort of think about it. >> Well, I like the strategy because one of our guests, Jumark Dehghani is I think one of the foremost thinkers on this notion of of the data mesh And her premise is that the data builders, data product and service builders are frustrated because the big data system is generic to context. There's no context in there. But by having context in the big data architecture and system you can get products to market much, much, much faster. So, and that seems to be your philosophy but I'm going to jump ahead to my ecosystem question. You've mentioned Databricks a couple of times. There's another partner that you have, which is Snowflake. They're kind of trying to build out their own DataCloud, if you will and GlobalMesh, and the one hand they're a partner on the other hand they're a competitor. How do you sort of balance and square that circle? >> Look, when I see Snowflake, I actually see a partner. When we see essentially we are when you think about Azure now this is where I sort of step back and look at Azure as a whole. And in Azure as a whole, companies like Snowflake are vital in our ecosystem. I mean, there are places we compete, but effectively by helping them build the best Snowflake service on Azure, we essentially are able to differentiate and offer a differentiated value proposition compared to say a Google or an AWS. In fact, that's been our approach with Databricks as well. Where they are effectively on multiple clouds and our opportunity with Databricks is to essentially integrate them in a way where we offer the best experience the best integrations on Azure Berna. That's always been our focus. >> Yeah, it's hard to argue with the strategy or data with our data partner and ETR shows Microsoft is both pervasive and impressively having a lot of momentum spending velocity within the budget cycles. I want to come back to AI a little bit. It's obviously one of the fastest growing areas in our survey data. As I said, clearly Microsoft is a leader in this space. What's your vision of the future of machine intelligence and how Microsoft will participate in that opportunity? >> Yeah, so fundamentally, we've built on decades of research around essentially vision, speech and language. That's been the three core building blocks and for a really focused period of time, we focused on essentially ensuring human parity. So if you ever wonder what the keys to the kingdom are, it's the boat we built in ensuring that the research or posture that we've taken there. What we've then done is essentially a couple of things. We've focused on essentially looking at the spectrum that is AI. Both from saying that, "Hey, listen, "it's got to work for data analysts." We're looking to basically use machine learning techniques to developers who are essentially, coding and building machine learning models from scratch. So for that select proposition manifest to us as really AI focused on all skill levels. The other core thing we've done is that we've also said, "Look, it'll only work as long "as people trust their data "and they can trust their AI models." So there's a tremendous body of work and research we do and things like responsible AI. So if you asked me where we sort of push on is fundamentally to make sure that we never lose sight of the fact that the spectrum of AI can sort of come together for any skill level. And we keep that responsible AI proposition absolutely strong. Now against that canvas Dave, I'll also tell you that as Edge devices get way more capable, where they can input on the Edge, say a camera or a mic or something like that. You will see us pushing a lot more of that capability onto the edge as well. But to me, that's sort of a modality but the core really is all skill levels and that responsibility in AI. >> Yeah, so that brings me to this notion of, I want to bring an Edge and hybrid cloud, understand how you're thinking about hybrid cloud, multicloud obviously one of your competitors Amazon won't even say the word multicloud. You guys have a different approach there but what's the strategy with regard to hybrid? Do you see the cloud, you're bringing Azure to the edge maybe you could talk about that and talk about how you're different from the competition. >> Yeah, I think in the Edge from an Edge and I even I'll be the first one to say that the word Edge itself is conflated. Okay, a little bit it's but I will tell you just focusing on hybrid, this is one of the places where, I would say 2020 if I were to look back from a COVID perspective in particular, it has been the most informative. Because we absolutely saw customers digitizing, moving to the cloud. And we really saw hybrid in action. 2020 was the year that hybrid sort of really became real from a cloud computing perspective. And an example of this is we understood that it's not all or nothing. So sometimes customers want Azure consistency in their data centers. This is where things like Azure Stack comes in. Sometimes they basically come to us and say, "We want the flexibility of adopting "flexible button of platforms let's say containers, "orchestrating Kubernetes "so that we can essentially deploy it wherever you want." And so when we designed things like Arc, it was built for that flexibility in mind. So, here's the beauty of what something like Arc can do for you. If you have a Kubernetes endpoint anywhere, we can deploy an Azure service onto it. That is the promise. Which means, if for some reason the customer says that, "Hey, I've got "this Kubernetes endpoint in AWS. And I love Azure SQL. You will be able to run Azure SQL inside AWS. There's nothing that stops you from doing it. So inherently, remember our first principle is always to meet our customers where they are. So from that perspective, multicloud is here to stay. We are never going to be the people that says, "I'm sorry." We will never say (speaks indistinctly) multicloud but it is a reality for our customers. >> So I wonder if we could close, thank you for that. By looking back and then ahead and I want to put forth, maybe it's a criticism, but maybe not. Maybe it's an art of Microsoft. But first, you did Microsoft an incredible job at transitioning its business. Azure is omnipresent, as we said our data shows that. So two-part question first, Microsoft got there by investing in the cloud, really changing its mindset, I think and leveraging its huge software estate and customer base to put Azure at the center of it's strategy. And many have said, me included, that you got there by creating products that are good enough. We do a one Datto, it's still not that great, then a two Datto and maybe not the best, but acceptable for your customers. And that's allowed you to grow very rapidly expand your market. How do you respond to that? Is that a fair comment? Are you more than good enough? I wonder if you could share your thoughts. >> Dave, you hurt my feelings with that question. >> Don't hate me JG. (both laugh) We're getting it out there all right, so. >> First of all, thank you for asking me that. I am absolutely the biggest cheerleader you'll find at Microsoft. I absolutely believe that I represent the work of almost 9,000 engineers. And we wake up every day worrying about our customer and worrying about the customer condition and to absolutely make sure we deliver the best in the first attempt that we do. So when you take the plethora of products we deliver in Azure, be it Azure SQL, be it Azure Cosmos DB, Synapse, Azure Databricks, which we did in partnership with Databricks, Azure Machine Learning. And recently when we premiered, we sort of offered the world's first comprehensive data governance solution in Azure Purview. I would humbly submit it to you that we are leading the way and we're essentially showing how the future of data, AI and the Edge should work in the cloud. >> Yeah, I'd be disappointed if you capitulated in any way, JG. So, thank you for that. And that's kind of last question is looking forward and how you're thinking about the future of cloud. Last decade, a lot about cloud migration, simplifying infrastructure to management and deployment. SaaSifying My Enterprise, a lot of simplification and cost savings and of course redeployment of resources toward digital transformation, other valuable activities. How do you think this coming decade will be defined? Will it be sort of more of the same or is there something else out there? >> I think that the coming decade will be one where customers start to unlock outsize value out of this. What happened to the last decade where people laid the foundation? And people essentially looked at the world and said, "Look, we've got to make a move. "They're largely hybrid, but you're going to start making "steps to basically digitize and modernize our platforms. I will tell you that with the amount of data that people are moving to the cloud, just as an example, you're going to see use of analytics, AI or business outcomes explode. You're also going to see a huge sort of focus on things like governance. People need to know where the data is, what the data catalog continues, how to govern it, how to trust this data and given all of the privacy and compliance regulations out there essentially their compliance posture. So I think the unlocking of outcomes versus simply, Hey, I've saved money. Second, really putting this comprehensive sort of governance regime in place and then finally security and trust. It's going to be more paramount than ever before. >> Yeah, nobody's going to use the data if they don't trust it, I'm glad you brought up security. It's a topic that is at number one on the CIO list. JG, great conversation. Obviously the strategy is working and thanks so much for participating in Cube on Cloud. >> Thank you, thank you, Dave and I appreciate it and thank you to everybody who's tuning into today. >> All right then keep it right there, I'll be back with our next guest right after this short break.

>> Announcer: From around the globe, it's theCUBE with digital coverage of Dell Technologies World Digital Experience, brought to you by Dell Technologies. >> Hello everyone and welcome back to theCUBE's continuing coverage of Dell Tech World 2020. This is Dave Volante and with me is Dennis Hoffman. He's a senior vice president and general manager for telecom systems business at Dell Technologies. Good to see you Dennis. Welcome. >> Thanks Dave. Great to be here. >> So let's talk a little bit about corporate strategy, which is your wheelhouse. I'm curious, has the pandemic at all altered your thinking on Dell strategy? >> Interestingly enough it hasn't. I suppose it would be standard for me to say that, but if anything, it's just given us both a sense of the challenge of what we had to do as a company to keep doing business. But also it's been really illuminating because it's given us a glimpse of the future. And fortunately, I think we've been pretty well prepared for what's happening. >> Well, I think in a way there's a bias inside of Dell because you guys were probably more work from home than the average company and you, in a way, might've been more prepared for this and maybe your thinking was already headed in that direction. What do you think about that? >> No, I think it's a reasonable thesis. The company is very much a work-from-home oriented or mobile in terms of where we work, an overall, I guess, hypothesis that work's something you do, it's not a place. But we also had a portfolio that benefited from the pandemic and an overarching strategy that was really to help our customers transform digitally. And if anything, the pandemic's accelerated all of that. So again, not without its challenges. And I certainly feel for the folks who get an awful lot of their energy from working with people every day because that's what's missing for an awful lot of folks who are doing an awful lot of what you and I are doing here. But otherwise I think we were biased toward it and it worked out pretty well so far. >> Okay. So it hasn't changed your strategy, but I would imagine some of your assumptions have changed. I mean, obviously more people are going to be working from home now, probably at least double. If it was 15 to 20% pre-COVID, it's going to be, let's call it 30, 35, maybe even 40% post-COVID. Maybe it's going to take a while, six, nine months to get there. But I would imagine some of your assumptions have changed. Is that a fair statement? >> Yeah, I think ours and the industries at large. Most companies' business continuity plans really centered around natural disasters. In most of those plans, 30% of the population working remotely was the high watermark. Right now, we're seeing whole industries redoing their business continuity plans, factoring in 60, 70% bogeys for how many people or what percentage of their population would work from home. As we surveyed our employees, 90% of people said we be either some form of hybrid work experience or completely remote. So, again, if we're for a bit of a leading edge on this, we're probably going to be tilted even more toward it, but there's been a big change in assumption about what remote work looks like and what you've got to do to make it productive. >> So we're a decade and a half into the cloud or at least the modern cloud era. What's your take on where the industry is today and how it affects your business and your cloud strategy broadly? >> Yeah, it's a fascinating. We're in the midst of an ever accelerating set of cycles or pendulum swings from centralized computing to decentralized computing back to centralized. We went from the mainframe era to the client server era and then even quicker to the cloud era. And now we're seeing the emergence of the edge. The one thing that's constant through all of this is workloads are like water. They seek their ground. Workloads have characteristics. They need performance, economics, security, data gravity. And so we've been firm believers through this whole time that a certain amount of workload's going to end up in a very centralized model. Some is going to end up very decentralized and our job is just to enable our customers to put the workloads where they need to run best. So as you point out, we're quite a ways into the cloud era now. It looks like the edge era is emerging. I like to think of it as really three legs of a stool. You've got work can run in a private data center, it can run in a public data center or it can run everywhere else. And increasingly, everywhere else is being called the Edge, all of it by the way, in a cloud operating model. So big distinction between cloud, the model and cloud, the place. And so in many ways, we talked specifically to certain vertical markets, the cloud era is already beginning to give way to the beginning of the Edge era. >> Well, and at the same time too, you're seeing the hyperscalers recognizing the need for whatever it is, for economics, for legal reasons, for preference or latency moving on-prem. >> Right. >> And so I was having an interesting discussion with the CIO the other day and I asked them, "Well, what what do you look at as cloud? "Cloud is everywhere. "I got my cloud on-prem. "I got my multiple clouds, which is clear. "Everybody's going multicloud." And then he happened to have 17,000 stores that he was looking after. He goes, that's Edge to me. That's all part of my cloud. And now of course, part of your role is telco. So let's talk about that space. You've got the over-the-top providers. They're sucking off the infrastructure that have been built out by the telcos. Cost per bid is coming down. Data uses is exploding. And the telco industry really has to transform its infrastructure. They're not agile enough and they can't wait to get to this new era of 5G. So I'm interested in your thoughts on that, how you see Dell helping. >> Well, as I'll tell you, you characterize it right on. I've in the last several months, spend a lot of time with telecom executives all over the world because of how easy it is to do this sort of thing. And they need to transform. The digital transformation sweeping the rest of the world has caught up with telecom and for a whole bunch of reasons. And some of those you pointed out, right, agility, cost, economics. They're in a funny place. Never has the demand for communication services been greater. And yet never have their financial positions been more challenged. Because they're stuck between an old, fairly proprietary, closed architecture and a handful of vendors and on the other hand, embracing this cloud computing data era where there's thousands of vendors. And they somehow all need to be cobbled together into an open software-defined system that runs on industry standard hardware. And yet most telecoms aren't prepared to do that integration themselves. So for us, we see immense opportunity. It's literally as if a massive 100 billion dollar plus addressable market has effectively decided they need to start buying the kinds of things we've been making for years. And moreover, they are by definition, fundamentally a distributed model. The big difference, I think, between Dell Technologies and a hyperscaler is we as a company we're built in and for a distributed computing world. We deal with very mundane topics like how do you get a person onsite within an hour? And how many spares depots do you have? And all of those sorts of things. Whereas hyperscalers were built for the exact opposite. A world in which they said, "Hey, give me your data, "give me your workloads. "I'll think hard about it. "And I'll give you a very flexible economic model." The Edge puts all of that up in the air and telcos's the leading part of this Edge, right? They're the ones that own a great deal of the Edge. And as you pointed out, 5G is really the thing that's got everybody excited. >> Well, you bring up a good point about the hyperscalers. I mean, their challenge now is they go on-premise. Okay. How do you service and support those customers at scale 'cause everything they do is at scale, it's all highly automated. So that's interesting. At the same time, I wonder you're a strategy guy. You look at what Amazon retail does. They're putting up warehouses everywhere. They're putting points of presence. I wonder if there are analogs to the technology business. It's probably more complicated, right, 'cause you're not servicing, you're just delivering. >> But I think you're right on. There's analogs. Look, we all are what we are as vendors. We all have our business models. Ours is to sell equipment and software and services to somebody. Amazon, since its founding, has really been about how do I insert myself in a transaction and ease that transaction and take a slice? Google's been about democratizing and monetizing the world's data. So Amazon needs access to transactions. Google needs access to the world's data, all the hyperscalers want into telco because they want onto the Edge. The same point you made about on-premises, right, like Outpost or Azure Stack. It's fundamentally admission by a hyperscaler that, "Yeah, I guess all workload doesn't belong "in the public cloud. "It's not all going to end up here." And I think they've got the same challenge when it comes to the Edge. And so people are trying to build their way out 'cause they need connectivity to the Edge. For us, we know that telecoms have to become multi clouds. You've referenced earlier the over-the-top profit problem. Well, they lost the profits from the consumer. B2C, they built the networks, they ran the networks and everybody else took the profit. So now here comes 5G with the promise of business services, real B2B revenue opportunities for telecom. And once again, they're faced with a choice. Either they become the cloud operator and allow the hyperscalers in as part of their multi-cloud or they give up the cloud to the hyperscalers and there go the over-the-top profits again. So it really, I found, a fascinating set of dynamics and an industry that can really use the help of somebody like Dell Technologies. >> Well, that's interesting 'cause as is many markets, consumer leads and then B2B markets open up. Well, how do you think this plays out? I mean, the telcos have very specialized hardware. They got this hardened and fossilized infrastructure. So where do you guys fit in that transformation and how do you see it evolving? >> Well, it's already started in a way, it's from the inside out. So telecommunications companies, as I look at them, as we look at them, they're almost like three companies in one. They have conventional IT organizations that in many ways look no different than a bank. They have their businesses, of course, the network where they spend the vast majority of their money, but it's not homogenous. There's a network core, there's a network Edge and then there's an access network. And then most of them, of course, sell services, business services. So they have lines of business. So we look at them as an IT organization, through the CIO, as a massive network operator through the CTO and then as a business partner, some of whom are even in our channel program and their cloud, their cloud services partners. And that's all through their line of business. So they're starting to open up from the inside out. Data center's going through transformation. It's begun in the network core. Now, the Edge is the next thing. And the RAN, in case of mobile operator, the radio access network, will ultimately come. And so you're right. There's a fossilized infrastructure in some places, but we've already seen the core start to desegregate and it will now ripple all the way out to their Edge and I think frankly through it and right onto the enterprise premise with private mobility. >> And so do you see them taking that infrastructure model all the way out to the Edge and trying to replicate essentially their what would've been monopolies for years or do you see them... It sounds like it's going to be a mix. Some of them are actually maybe going to lean on the hyperscalers and try to become more over-the-top content providers. >> Well, I think two challenges in business right? I guess they say there's three great motivators in business in life, make money, save money, stay out of jail, like revenue, cost and risk. They got a cost problem. They've got to get off the monolithic closed infrastructure architectures. They've got a revenue problem that a lot of the additional revenues and services went to somebody else, the OTT, the over-the-top folks. And so I think you will absolutely see a mix, but nobody can afford. No telecom communications company can afford to simply hand their network over. Unless they've reconciled, I'm just going to be a dumb pipe again, right? And none of them want that. >> Right. = But I think in many ways, they're waiting for somebody to walk in and say, "But here's the answer." And I can tell you that at Dell Technologies, and by that, I mean both within Dell and certainly within VMware, we're very strong proponents of the notion of an open software-defined network architecture built on industry standard hardware. And we're pretty well positioned, I think, to provide it or certainly that's the hope and the thesis behind our business. >> Yeah. So that then allows them to compete much more effectively, to provide, like you say, new B2B services, but it really is their infrastructure has been the big blocker up until recently. And you're right. I mean, network function virtualization has started to see through. We've seen some of the benefits of that and then now they've got to take it to the next level, your point about the Edge. >> Well in the 5G standard or 5G, the next cellular technology generation is actually defined by the three GPP standards. Release 15 was the first one that came out and it specified both standalone 5G networks where you can get all of these benefits and non-standalone where you basically have to mix 5G into the core, rely on the 4G Edge. And that's the only thing that's been deployed so far. So as in many things, the hype leads the reality by a little bit. So we've been talking 5G for a while, but the release 16 that would get you some of the really hyped up features of 5G just released this year. So it's coming and there's a lot of talk about it right now. There's a race to have the largest 5G network in America and the largest 5G network in the UK and so on and so forth. But this isn't really the true power of 5G. That window is still open and it's coming. >> You do a lot of strategy work. You obviously see the opportunity Edge, the term is just enormous. So you got to be wetting your chops at that. At the same time, the requirements are totally different. So I'm curious as to how you, as a strategy expert, dovetail into the architectural decisions that have to be made and the connective tissue between strategy and architecture and actually the whole go-to market, that whole value chain that you think about, how are you thinking about that in the world of Edge? >> Well there's, at the end of the day, two strategy decisions you got to make, where do I play and if I decide to play there, how do I win? So where do you play on the Edge is a very interesting question. Anytime there's a new computing paradigm shift, you go from something that's been pretty stable and frankly pretty horizontal and it becomes pretty verticalized. So the Edge is thousands of things right now. And it's many highly verticalized use cases, manufacturing, mining, retail, even something as simple as campus wifi replacement. So you've got to pick your spot. And for a company of our size, that really comes down to thinking about which of these Edge use cases are going to pop first, which one's going to teach you the most, which one's going to have the right level of scale. And this is where telco and Edge intersect because it turns out one big and easily reachable use case for Edge is to partner strongly with the telecommunications industry where something like 30 companies in the world make up 80% of the capital spending. I mean, you don't have to run a Superbowl ad. You can get all of your customers in a bus, right. So that's why I think there's really this somewhat silent, somewhat subtle and somewhat not so subtle competition for the architecture of the telecom industry as it refreshes, both because of 5G as an inflection point, but also just because of the stuff we talked about earlier, the economics, the need to modernize and embrace open-software defined industry standard architecture. >> And do have visibility at this point as to how portable the race to the telcos identify that sort of new standards? Do you have a sense as to how portable that would be to some of these other use cases or is it really like the software industry of when that started to grow, it was just so fragmented. Now, granted it's consolidated now, but do you have visibility on that yet? >> A little, but I mean the basic building blocks are quite portable. There's radio technology, 5G radio technology and there's a distinction between what might be required say to replace wifi at the Dell Round Rock Campus versus what AT&T needs for Manhattan, right? >> Yeah. >> But basically there's radio technology, which is increasingly becoming software running on industry standard hardware. And then the same sort of virtualization layer that is helpful in basically pulling all of this together, plays there as does the underlying hardware where Edge servers can be built for telco spec and easily modified to be an Edge enterprise use case. That's the base. On top of that however, is often a vertical solution. Like in retail's very timely, temperature sensing and mask detection and distance determination, right? So somebody's going to want to take that capability. And that's not something you're going to bounce off of some public cloud. You're going to want to actually understand in real time, as people walk in and out of the place, are they being compliant with whatever policies I have? So on top of some of this compute and virtualization and to some extent sometimes storage on the Edge, what else goes on that? Is it a video surveillance solution? Is it an automated mining RFID solution? And so we've got a little bit of insight and we know which verticals appear to be largest right now and which ones are going to pop first. And that's where a lot of people are putting their attention. >> Well, it's going to be interesting 'cause it sounds like there's a real long tale there. And you mentioned industry standard hardware and software, but maybe a new industry standard emerges for some of those use cases that you just mentioned where you need very low latency. Maybe that's where ARM gets in and maybe get some massive volume because while it's a long tail, it's also huge. >> It is. I mean, some people are estimating the Edge economy to be four times the internet economy because we get stuff that's going to be written that we don't even... It's no different than we went from... At one point, the only software in the world was mainframe software. And then some knucklehead wrote client server software and it was considered a niche. Fast forward 15 years later, mainframe is a subsegment of the computer industry and it's all client server software. And then we go cloud native. And at first it's a couple of cloud native apps and pretty soon it's a bunch. And this thing just goes back and forth. The difference is or I think the interesting thing is the cycle times are really compressing. I don't know if you've read Tom Friedman's latest book, "Thank You For Being Late", but it's all about how do we thrive as humans in the age of accelerations? Because the theory is we're not getting enough time to catch our breath now between pendulum swings. It's interesting. Same thing happened in cellular technology. I didn't know until I started doing this job, but 1G was real for about... It was the dominant form of networking for 17 years for mobile networking. Then 2G was for around 11. 3G was seven-ish. 4G looks like it's going to be six. So technology just keeps quickening. And it makes the amount of time we get to be horizontal and catch our breath as the industry is stable, there's always an inflection of some sort going on in our industry. And so change is absolutely the new normal. >> Yeah. And some of these things are really hard to predict. I mean, remember TCP/IP used to be this old, reliable protocol that runs the world. >> Exactly right. >> I want to ask you about... Last question is as a service initiative of Project Apex or Apex it's called. And that's obviously not just some kind of gimmick. I mean, that affects the strategy of the entire organization, the way in which customers want to consume the product or platform strategies now. How does that as a service pricing model affect the business that we've been talking about for the last 10 or 15 minutes? >> Well, the good news for us, those of us at the company working on Edge and telecom and all of that sort of stuff is we're actually building the business under the Apex philosophy, right? So our design center out of the gate is as a service. Michael made the observation a long time ago within our leadership team that, back to my comment, that workloads are like water. They seek their ground. There's a difference between where a workload belongs and the interest in a particular operating model or excuse me, a particular consumption model. And get they've been combined for a long time, right? The only way to get the, as a service consumption model, was through public cloud infrastructure. But it turns out that the right place for workload may well be on-premises not in a private data center or it may well be on the Edge not in a public cloud, but people still want to take advantage of the consumption model, right? The economics are the economics. And so for me, doing the telecom stuff, it's, as a service, the heart of the design center from a consumption model right out of the gate, which is frankly easier than trying to retrofit everything else. >> Right. >> But nonetheless, for us as a company, it's just an opportunity to give our customers the choice that they want in terms of not only what they acquire, but how they acquire it. >> Well Dennis, I always love talking to you. You're such a clear thinker and you've obviously gone deep into some of these topics. And good luck in the role in the telco world. It's obviously a huge opportunity. Everybody's really excited about it. And thank you for coming on theCUBE. >> All right. Thank you, Dave. It's been a pleasure. Nice chatting with you. >> Alright. And thank you for watching, everybody. This is theCUBE's coverage of Dell Tech World 2020, the virtual cube. Keep it right there. We'll be right back right after this short break. (relaxed music)

>> Narrator: From around the globe, it's theCUBE, with digital coverage of Dell Technologies World. Digital Experience brought to you by Dell Technologies. >> Welcome to theCUBE's coverage of Dell Technologies World 2020, the Digital Experience. I am Lisa Martin and I've got a couple of guests joining me. Please welcome Puneet Dhawan, the Director of Product Management, Hyper-converged infrastructure for Dell Technologies. Puneet great to see you today. >> Thank you, for having me over. >> And we've got a customer that's going to be articulating all the value that Puneet's going to talk about. Please welcome Greg Altman, the IT infrastructure manager from Swiff-Train. Hey, Greg, how are you today? >> I'm doing well. Thank you. >> Excellent. All right guys. So Puneet, let's start with you, give us a little bit of an overview of your role. You lead product management, for Dell Technologies partner aligned HCI systems. Talk to us about that? >> Sure, absolutely. Um so, you know, it's largely about providing customers the choice. My team specifically focuses on developing Hyper-converged infrastructure products for our customers that are aligned to key technologies from our partners, such as Microsoft, Nutanix, et cetera. And that, you know, falls very nicely with meeting our customers on what technology they want to pick on, what technology they want to go with, whether it's VMware, Microsoft, Nutanix, we have to source from the customers. >> Let's dig into Microsoft. Talk to us about Azure Stack HCI. How is Dell Tech working with them to position this in the market? >> Sure, um, this is largely about following the customer journey towards digital transformation. So both in terms of where they are in digital transformation and how they want to approach it. So for example, we have a large customer base who's looking to modernize their legacy Hyper-V architectures, and that's where Azure Stack HCI fits in very nicely, and not only our customers are able to modernize the legacy architectures using the architectural benefits of simplicity, high performance, simple management, scalability. (Greg breathes heavily) For HCI for Hyper-V, at the same time, they can connect to Azure to get the benefits of the bullet's force. Now on the other end, we have a large customer base who started off in Azure, you know, they have cloud native applications, you know, kind of born in the cloud. But they're also looking to bring some of the applications down to on-prem, or things like disconnected scenarios, regulatory concerns, data locality reasons. And for those customers, Microsoft and Dell have a department around Dell EMC Integrated solutions for Azure Stack Hub. And that's what essentially brings Azure ecosystem, on-prem so it's like running cloud in your own premises. >> So you mentioned a second ago giving customers choice, and we always talk about that at pretty much every event that we do. So tell me a little bit about how the long standing partnership that Dell Technologies has with Microsoft decades. How is that helping you to really differentiate the technology and then show the customers the different options, together these two companies can deliver? >> Sure, so we've had a very long standing partnerships, actually over three decades now. Across the spectrum whether we talk about our partnership more on the Windows 10 side, and the modernization of the workforce, to the level of hybrid cloud and cloud solutions, and helping even customers, you know, run their applications on Azure to our large services offerings. Over the past several years, we have realized how important is hybrid cloud and multicloud for customers. And that's where we have taken our partnership to the next level, to co-develop, co-engineer and bring to the market together our full portfolio of Azure Stack Hybrid Solutions. And that's where I've said, meeting customers on where they are either bringing Azure on-prem, or helping customers on-prem, modernize on-prem architectures using Azure Stack HCI. So, you know, there's a whole lot of core development we have done together to simplify how customers manage on-prem infrastructures on a day-to-day basis, how do they install it, even how they support it, you know, we have joined support agreements with Microsoft that encompassed and bearing the entirety of the portfolio so that customers have one place to go, which is Dell Technologies to get not only the product, either in US or worldwide, to a very secure supply chain to Dell EMC, at the same time for all their support consulting services, whether they're on-prem or in the cloud. We offer all those services in very close partnership with Microsoft. >> Terrific. Great. Let's switch over to you now, probably we talk about what Swiff-Train is doing with its Azure Stack HCI, tell our audience a little bit about Swiff-Train what you guys are what you do. >> Well, Swiff-Train is a full covering flooring wholesaler, we sell flooring across Texas, Oklahoma, Louisiana, Arkansas, even into Florida. And we're an 80 year old company, 80 plus. And we've been moving forward with kind of hybridizing our infrastructure, making use of cloud where it makes sense. And when it came to our on-prem infrastructure, it was old, well five, six years old, running Windows 2012 2016, it was time to upgrade. And when we look at doing a large scale upgrade, like that, we called Dell and say, you know, this is what we're trying to do, and what's the new technologies that we can do that makes the migration work easier. And that's where we wound up with Azure Stack. >> So from a modernization perspective, you mentioned 80 plus year old company, I was looking on the website 1937. I always like to talk to companies like that, because modernizing when you've been around for that long it's challenging, it's challenging culturally , it's challenging historically, But talk to us a little bit about some of the specifics, that you guys were looking to Dell and Microsoft to help modernize. And was this really to drive things like, you know, operational simplicity, allow the business to have more agility so that it can expand in some of those other cities, like we talked about? >> Absolutely. We were dealing with a long maintenance window five or six hours every week patching, updating. Since we moved to Azure Stack HCI, we have virtually zero downtime. That allows our night shifts or weekend crews to be able to keep working. And the system is just bulletproof. It just does not go down. And with the lifecycle management tools that we get with Windows Admin Center, and Dell's OpenManage Plug-in, I log into one pane of glass in the morning, and I look and I say, "Hey, all my servers are going great. Everything's in the green." I know that that day, I'm not going to have any infrastructure issues, I can deal with other issues that make the business money. >> And I'm sure they appreciate that. Tell us a little bit about the the actual implementation and the support as, as Puneet talked about all of the core development, the joint support that these two powerhouses deliver. Tell us about that implementation. And then for your day to day, what's your interaction with Dell and or Microsoft like? >> Well, for the implementation, we worked with our Dell representative. And we came up with a sizing plan. This is what we needed to do, we had eight or nine physical servers that we wanted to get rid of. And we wanted to compress down. Now we're definitely went from eight or nine to you servers down to three rack units of space with an edge, including the extra switches and stuff that we had to do. So I mean we were able to get rid of a lot of storage space or rack space. And as far as the implementation was really easy. Dell literally has a book, you follow the book and it's that simple. (Puneet chuckles) >> I like that I think more of us these days, can you somewhat write a book that we can just follow? That would be fantastic. One more question, Greg for you, before we go back to Puneet. As Puneet talked about in the beginning from describing his role, that you know, Dell Technologies works with a lot of other vendors. Why Azure Stack HCI for Swiff-Train? >> Well, it made sense for us. We were already moving, several of our websites were already moved to Azure, we've been a Hyper-V user for many years. So it was just kind of a natural evolution to migrate in that direction, because it kind of pulls all of our management tools into one, well you know, a one pane of glass type of scenario. >> Excellent. All right Puneet back to you. With some of the things that you talked about before and that Greg sort of articulated about simplifying day-to-day. Greg, I saw in my notes that you had this old aging infrastructure, you were spending five hours a week patching maintain, that you say is now virtually eliminated, Puneet, Dell Technologies and Microsoft had done quite a bit of work to simplify the operational experience. Talk to us about that, and what are some of the measurable improvements that you guys have made? >> Sure. It all starts with neither on how we approach the problem, and we have always taken a very product-centric approach at Azure Stack HCI. You know, unlike, some of our competition, which had followed. There is a reference architecture, you can put Windows Server 2019 on it and go run your own servers, and the Hyper-converged Stack on it, but we have followed a very different approach where we have learned quite a lot, you know, we are the number one vendor in HCI space, and we know a thing or two about HCI and what customers really need there. So that's why from the very beginning, we have taken a product-centric approach, and doing that allows us to have product type offers in terms of our Kx notes that are specifically designed and built for Azure Stack HCI. And on top of that, we have done very specific integration to the management Stack, we've been doing Admin Center, that is the new management tool for Microsoft to manage, both on-prem, Hyper-converged infrastructure, your Windows servers, as well as any VM's that you're running on Azure, to provide customers a very seamless, you know, a single pane of glass for both the on-prem as well as infrastructure on public cloud services. And in doing that, our customers have really appreciated how simple it is to keep their clusters running, to reduce the maintenance windows, based on some of our internal testing that we have done. IT administrators can reduce the time they spend on maintaining the clusters by over 90%. Over 40% reduction in the maintenance window itself. And all that leads to your clusters running in a healthy state. So you don't have to worry about pulling the right drivers, right founder from 10 different places, making sure whether they are qualified or not when running together, we provide one single pane of glass that customers can click on, and you know, see whether their questions are compliant or not, and if yes go update. And all this has been possible by a joint engineering with Microsoft. >> Can you just describe the difference between an all in one validated HCI solution, which is what you're delivering, versus competitors that are only delivering a reference architecture? >> Absolutely. So if you're running just a reference architecture, you are running an operating system, systems Stack on a server, we know that when it comes to running HCI, that means running also business critical applications on a clustered environment. You need to make sure that all the hardware, the drivers, the founder, the hard drives, the memory configuration, the network configurations, all that can be very complex very easily. And if you have reference architectures, there is no way to know, but then running certified components in my note are not. How do you tell then? If a part fails? How do which part to sell or send, you know, for a replacement? If you're just running a reference architecture, you have no way to say the part the hard drive that failed, the one that was sent to the customer to replace whether that is certified for Azure Stack HCI or not? You know, what, how do you really make a determination, what is the right firmware that needs to be applied to a cluster of what other drivers that apply to be cluster, that are compliant and tested for Azure Stack HCI. None of these things are possible, if you just have a reference architecture approach. That's why we have been very clear that our approach is a product-based approach. And, you know, very frankly this is how we have... that's the feedback we've provided the Microsoft to, and we've been working very, you know, closely together. And you see that, now in terms of the new Azure Stack HCI, that Microsoft announced at Inspirely this year, that brings Microsoft into the mainstream HCI space as a product offering, and not just as a feature or a few features within the Windows Server program. >> Greg, I saw in the notes with respect to Swiff-Train that you guys have with Azure Stack HCI, you have reduced Rackspace by 50%, you talked about some of the Rackspace benefits. But you've also reduced energy by 70%. Those are big, impactful numbers, impacting not just your day-to-day but the overall business. >> That's true, >> Last question for you, Greg. If you think about how can you just describe the difference between an all in one validated HCI solution versus a reference architecture. For your peers watching in any industry. what's your... what are your top recommendations for going with a validated all in one solution? >> Well, we looked at doing the reference architecture's path, if you will, because we're hands on we like to build things and I looked at it and like Puneet said, "Drivers and memory and making sure that everything is going to work well together." And not only that everything is going to work well together. But when something fails, then you get into the finger pointing between vendors, your storage vendor, your process vendor, that's not something that we need to deal with. We need to keep a business running. So we went with Dell, it's one box, you know, but one box per unit and then you Stack two of them together you have a cluster. >> You make it sound so easy. >> Let us question-- >> I put together children's toys that were harder than building the Stack I promise you, I did it in an afternoon. >> Music to my ears Greg, thank you. (Greg giggles) >> It was that easy >> That is gold >> Easier to put together Azure Stack HCI than some, probably even opening the box of some children's toys I can imagine. (all chuckling) >> We should use that as a tagline. >> Exactly. You should, I think you have a new tagline there. Greg, thank you. Puneet, well last question for you, Would Dell Technologies World sessions on hybrid cloud benefits with Dell and Microsoft? Give us a flavor of what some of the things are that the audience will have a chance to learn. >> Yeah, this is a great session with Microsoft that essentially provides our customers an overview of our joint hybrid cloud solutions, both for Microsoft Azure Stack Hub, Azure stack HCI as well as our joint solutions on VMware in Azure. But much more importantly, we also talk about what's coming next. Now, especially with Microsoft as your Stack at CIO's a full blown product. Hyper hybrid, you know, HCI offering that will be available as, Azure service. So customers could run on-prem infrastructure that is Hyper-converged but managed pay bill for as an Azure service, so that they have always the latest and greatest from Microsoft. And all the product differentiation we have created in terms of a product-centric approach, simpler lifecycle management will all be applicable, in this new hybrid, hybrid cloud solution as well. And that led essentially a great foundation for our customers who have standardized on Hyper-V, who are much more aligned to Azure, to not worry about the infrastructure on-prem. But start taking advantages of both the modernization benefits of HCI. But much more importantly, start coupling back with the hybrid ecosystem that we are building with Microsoft, whether it's running an Azure Kubernetes service on top to modernize the new applications, and bringing the Azure data services such as Azure SQL Server on top, so that you have a consistent, vertically aligned hybrid cloud infrastructure Stack that is not only easy to manage, but it is modern, it is available as a pay as you go option. And it's tightly integrated into Azure, so that you can manage all your on-prem as well as public cloud resources on one single pane of glass, thereby providing customers whole lot more simplicity, and operational efficiency. >> And as you said, the new tagline said from, beautifully from Greg's mouth, "The customer easier to put together than many children's toys." Puneet, thank you so much for sharing with us what's going on with Azure Stack HCI, what folks can expect to learn and see at Dell Tech World of virtual experience. >> Thank you. >> And Greg, thank you for sharing the story, what you're doing. Helping your peers learn from you. And I'm going to say on behalf of Dell Technologies, that awesome new tagline. That was cool. (Greg chuckles) (Lisa chuckles) >> Thank you. 'Preciate your time. >> We're going to use it for sure. (Greg chuckles) >> All right, for Puneet Dhawan and Greg Altman. I'm Lisa Martin. You're watching theCUBE's coverage of Dell Technologies World, the Digital Experience. (soft music)

>> Announcer: From around the globe, it's theCUBE with digital coverage of Dell Technologies World Digital Experience, brought to you by Dell Technologies. >> Hello everyone and welcome back to theCUBE's continuing coverage of Dell Tech World 2020. This is Dave Volante and with me is Dennis Hoffman. He's a senior vice president and general manager for telecom systems business at Dell Technologies. Good to see you Dennis. Welcome. >> Thanks Dave. Great to be here. >> So let's talk a little bit about corporate strategy, which is your wheelhouse. I'm curious, has the pandemic at all altered your thinking on Dell strategy? >> Interestingly enough it hasn't. I suppose it would be standard for me to say that, but if anything, it's just given us both a sense of the challenge of what we had to do as a company to keep doing business. But also it's been really illuminating because it's given us a glimpse of the future. And fortunately, I think we've been pretty well prepared for what's happening. >> Well, I think in a way there's a bias inside of Dell because you guys were probably more work from home than the average company and you, in a way, might've been more prepared for this and maybe your thinking was already headed in that direction. What do you think about that? >> No, I think it's a reasonable thesis. The company is very much a work-from-home oriented or mobile in terms of where we work, an overall, I guess, hypothesis that work's something you do, it's not a place. But we also had a portfolio that benefited from the pandemic and an overarching strategy that was really to help our customers transform digitally. And if anything, the pandemic's accelerated all of that. So again, not without its challenges. And I certainly feel for the folks who get an awful lot of their energy from working with people every day because that's what's missing for an awful lot of folks who are doing an awful lot of what you and I are doing here. But otherwise I think we were biased toward it and it worked out pretty well so far. >> Okay. So it hasn't changed your strategy, but I would imagine some of your assumptions have changed. I mean, obviously more people are going to be working from home now, probably at least double. If it was 15 to 20% pre-COVID, it's going to be, let's call it 30, 35, maybe even 40% post-COVID. Maybe it's going to take a while, six, nine months to get there. But I would imagine some of your assumptions have changed. Is that a fair statement? >> Yeah, I think ours and the industries at large. Most companies' business continuity plans really centered around natural disasters. In most of those plans, 30% of the population working remotely was the high watermark. Right now, we're seeing whole industries redoing their business continuity plans, factoring in 60, 70% bogeys for how many people or what percentage of their population would work from home. As we surveyed our employees, 90% of people said we be either some form of hybrid work experience or completely remote. So, again, if we're for a bit of a leading edge on this, we're probably going to be tilted even more toward it, but there's been a big change in assumption about what remote work looks like and what you've got to do to make it productive. >> So we're a decade and a half into the cloud or at least the modern cloud era. What's your take on where the industry is today and how it affects your business and your cloud strategy broadly? >> Yeah, it's a fascinating. We're in the midst of an ever accelerating set of cycles or pendulum swings from centralized computing to decentralized computing back to centralized. We went from the mainframe era to the client server era and then even quicker to the cloud era. And now we're seeing the emergence of the edge. The one thing that's constant through all of this is workloads are like water. They seek their ground. Workloads have characteristics. They need performance, economics, security, data gravity. And so we've been firm believers through this whole time that a certain amount of workload's going to end up in a very centralized model. Some is going to end up very decentralized and our job is just to enable our customers to put the workloads where they need to run best. So as you point out, we're quite a ways into the cloud era now. It looks like the edge era is emerging. I like to think of it as really three legs of a stool. You've got work can run in a private data center, it can run in a public data center or it can run everywhere else. And increasingly, everywhere else is being called the Edge, all of it by the way, in a cloud operating model. So big distinction between cloud, the model and cloud, the place. And so in many ways, we talked specifically to certain vertical markets, the cloud era is already beginning to give way to the beginning of the Edge era. >> Well, and at the same time too, you're seeing the hyperscalers recognizing the need for whatever it is, for economics, for legal reasons, for preference or latency moving on-prem. >> Right. >> And so I was having an interesting discussion with the CIO the other day and I asked them, "Well, what what do you look at as cloud? "Cloud is everywhere. "I got my cloud on-prem. "I got my multiple clouds, which is clear. "Everybody's going multicloud." And then he happened to have 17,000 stores that he was looking after. He goes, that's Edge to me. That's all part of my cloud. And now of course, part of your role is telco. So let's talk about that space. You've got the over-the-top providers. They're sucking off the infrastructure that have been built out by the telcos. Cost per bid is coming down. Data uses is exploding. And the telco industry really has to transform its infrastructure. They're not agile enough and they can't wait to get to this new era of 5G. So I'm interested in your thoughts on that, how you see Dell helping. >> Well, as I'll tell you, you characterize it right on. I've in the last several months, spend a lot of time with telecom executives all over the world because of how easy it is to do this sort of thing. And they need to transform. The digital transformation sweeping the rest of the world has caught up with telecom and for a whole bunch of reasons. And some of those you pointed out, right, agility, cost, economics. They're in a funny place. Never has the demand for communication services been greater. And yet never have their financial positions been more challenged. Because they're stuck between an old, fairly proprietary, closed architecture and a handful of vendors and on the other hand, embracing this cloud computing data era where there's thousands of vendors. And they somehow all need to be cobbled together into an open software-defined system that runs on industry standard hardware. And yet most telecoms aren't prepared to do that integration themselves. So for us, we see immense opportunity. It's literally as if a massive 100 billion dollar plus addressable market has effectively decided they need to start buying the kinds of things we've been making for years. And moreover, they are by definition, fundamentally a distributed model. The big difference, I think, between Dell Technologies and a hyperscaler is we as a company we're built in and for a distributed computing world. We deal with very mundane topics like how do you get a person onsite within an hour? And how many spares depots do you have? And all of those sorts of things. Whereas hyperscalers were built for the exact opposite. A world in which they said, "Hey, give me your data, "give me your workloads. "I'll think hard about it. "And I'll give you a very flexible economic model." The Edge puts all of that up in the air and telcos's the leading part of this Edge, right? They're the ones that own a great deal of the Edge. And as you pointed out, 5G is really the thing that's got everybody excited. >> Well, you bring up a good point about the hyperscalers. I mean, their challenge now is they go on-premise. Okay. How do you service and support those customers at scale 'cause everything they do is at scale, it's all highly automated. So that's interesting. At the same time, I wonder you're a strategy guy. You look at what Amazon retail does. They're putting up warehouses everywhere. They're putting points of presence. I wonder if there are analogs to the technology business. It's probably more complicated, right, 'cause you're not servicing, you're just delivering. >> But I think you're right on. There's analogs. Look, we all are what we are as vendors. We all have our business models. Ours is to sell equipment and software and services to somebody. Amazon, since its founding, has really been about how do I insert myself in a transaction and ease that transaction and take a slice? Google's been about democratizing and monetizing the world's data. So Amazon needs access to transactions. Google needs access to the world's data, all the hyperscalers want into telco because they want onto the Edge. The same point you made about on-premises, right, like Outpost or Azure Stack. It's fundamentally admission by a hyperscaler that, "Yeah, I guess all workload doesn't belong "in the public cloud. "It's not all going to end up here." And I think they've got the same challenge when it comes to the Edge. And so people are trying to build their way out 'cause they need connectivity to the Edge. For us, we know that telecoms have to become multi clouds. You've referenced earlier the over-the-top profit problem. Well, they lost the profits from the consumer. B2C, they built the networks, they ran the networks and everybody else took the profit. So now here comes 5G with the promise of business services, real B2B revenue opportunities for telecom. And once again, they're faced with a choice. Either they become the cloud operator and allow the hyperscalers in as part of their multi-cloud or they give up the cloud to the hyperscalers and there go the over-the-top profits again. So it really, I found, a fascinating set of dynamics and an industry that can really use the help of somebody like Dell Technologies. >> Well, that's interesting 'cause as is many markets, consumer leads and then B2B markets open up. Well, how do you think this plays out? I mean, the telcos have very specialized hardware. They got this hardened and fossilized infrastructure. So where do you guys fit in that transformation and how do you see it evolving? >> Well, it's already started in a way, it's from the inside out. So telecommunications companies, as I look at them, as we look at them, they're almost like three companies in one. They have conventional IT organizations that in many ways look no different than a bank. They have their businesses, of course, the network where they spend the vast majority of their money, but it's not homogenous. There's a network core, there's a network Edge and then there's an access network. And then most of them, of course, sell services, business services. So they have lines of business. So we look at them as an IT organization, through the CIO, as a massive network operator through the CTO and then as a business partner, some of whom are even in our channel program and their cloud, their cloud services partners. And that's all through their line of business. So they're starting to open up from the inside out. Data center's going through transformation. It's begun in the network core. Now, the Edge is the next thing. And the RAN, in case of mobile operator, the radio access network, will ultimately come. And so you're right. There's a fossilized infrastructure in some places, but we've already seen the core start to desegregate and it will now ripple all the way out to their Edge and I think frankly through it and right onto the enterprise premise with private mobility. >> And so do you see them taking that infrastructure model all the way out to the Edge and trying to replicate essentially their what would've been monopolies for years or do you see them... It sounds like it's going to be a mix. Some of them are actually maybe going to lean on the hyperscalers and try to become more over-the-top content providers. >> Well, I think two challenges in business right? I guess they say there's three great motivators in business in life, make money, save money, stay out of jail, like revenue, cost and risk. They got a cost problem. They've got to get off the monolithic closed infrastructure architectures. They've got a revenue problem that a lot of the additional revenues and services went to somebody else, the OTT, the over-the-top folks. And so I think you will absolutely see a mix, but nobody can afford. No telecom communications company can afford to simply hand their network over. Unless they've reconciled, I'm just going to be a dumb pipe again, right? And none of them want that. >> Right. = But I think in many ways, they're waiting for somebody to walk in and say, "But here's the answer." And I can tell you that at Dell Technologies, and by that, I mean both within Dell and certainly within VMware, we're very strong proponents of the notion of an open software-defined network architecture built on industry standard hardware. And we're pretty well positioned, I think, to provide it or certainly that's the hope and the thesis behind our business. >> Yeah. So that then allows them to compete much more effectively, to provide, like you say, new B2B services, but it really is their infrastructure has been the big blocker up until recently. And you're right. I mean, network function virtualization has started to see through. We've seen some of the benefits of that and then now they've got to take it to the next level, your point about the Edge. >> Well in the 5G standard or 5G, the next cellular technology generation is actually defined by the three GPP standards. Release 15 was the first one that came out and it specified both standalone 5G networks where you can get all of these benefits and non-standalone where you basically have to mix 5G into the core, rely on the 4G Edge. And that's the only thing that's been deployed so far. So as in many things, the hype leads the reality by a little bit. So we've been talking 5G for a while, but the release 16 that would get you some of the really hyped up features of 5G just released this year. So it's coming and there's a lot of talk about it right now. There's a race to have the largest 5G network in America and the largest 5G network in the UK and so on and so forth. But this isn't really the true power of 5G. That window is still open and it's coming. >> You do a lot of strategy work. You obviously see the opportunity Edge, the term is just enormous. So you got to be wetting your chops at that. At the same time, the requirements are totally different. So I'm curious as to how you, as a strategy expert, dovetail into the architectural decisions that have to be made and the connective tissue between strategy and architecture and actually the whole go-to market, that whole value chain that you think about, how are you thinking about that in the world of Edge? >> Well there's, at the end of the day, two strategy decisions you got to make, where do I play and if I decide to play there, how do I win? So where do you play on the Edge is a very interesting question. Anytime there's a new computing paradigm shift, you go from something that's been pretty stable and frankly pretty horizontal and it becomes pretty verticalized. So the Edge is thousands of things right now. And it's many highly verticalized use cases, manufacturing, mining, retail, even something as simple as campus wifi replacement. So you've got to pick your spot. And for a company of our size, that really comes down to thinking about which of these Edge use cases are going to pop first, which one's going to teach you the most, which one's going to have the right level of scale. And this is where telco and Edge intersect because it turns out one big and easily reachable use case for Edge is to partner strongly with the telecommunications industry where something like 30 companies in the world make up 80% of the capital spending. I mean, you don't have to run a Superbowl ad. You can get all of your customers in a bus, right. So that's why I think there's really this somewhat silent, somewhat subtle and somewhat not so subtle competition for the architecture of the telecom industry as it refreshes, both because of 5G as an inflection point, but also just because of the stuff we talked about earlier, the economics, the need to modernize and embrace open-software defined industry standard architecture. >> And do have visibility at this point as to how portable the race to the telcos identify that sort of new standards? Do you have a sense as to how portable that would be to some of these other use cases or is it really like the software industry of when that started to grow, it was just so fragmented. Now, granted it's consolidated now, but do you have visibility on that yet? >> A little, but I mean the basic building blocks are quite portable. There's radio technology, 5G radio technology and there's a distinction between what might be required say to replace wifi at the Dell Round Rock Campus versus what AT&T needs for Manhattan, right? >> Yeah. >> But basically there's radio technology, which is increasingly becoming software running on industry standard hardware. And then the same sort of virtualization layer that is helpful in basically pulling all of this together, plays there as does the underlying hardware where Edge servers can be built for telco spec and easily modified to be an Edge enterprise use case. That's the base. On top of that however, is often a vertical solution. Like in retail's very timely, temperature sensing and mask detection and distance determination, right? So somebody's going to want to take that capability. And that's not something you're going to bounce off of some public cloud. You're going to want to actually understand in real time, as people walk in and out of the place, are they being compliant with whatever policies I have? So on top of some of this compute and virtualization and to some extent sometimes storage on the Edge, what else goes on that? Is it a video surveillance solution? Is it an automated mining RFID solution? And so we've got a little bit of insight and we know which verticals appear to be largest right now and which ones are going to pop first. And that's where a lot of people are putting their attention. >> Well, it's going to be interesting 'cause it sounds like there's a real long tale there. And you mentioned industry standard hardware and software, but maybe a new industry standard emerges for some of those use cases that you just mentioned where you need very low latency. Maybe that's where ARM gets in and maybe get some massive volume because while it's a long tail, it's also huge. >> It is. I mean, some people are estimating the Edge economy to be four times the internet economy because we get stuff that's going to be written that we don't even... It's no different than we went from... At one point, the only software in the world was mainframe software. And then some knucklehead wrote client server software and it was considered a niche. Fast forward 15 years later, mainframe is a subsegment of the computer industry and it's all client server software. And then we go cloud native. And at first it's a couple of cloud native apps and pretty soon it's a bunch. And this thing just goes back and forth. The difference is or I think the interesting thing is the cycle times are really compressing. I don't know if you've read Tom Friedman's latest book, "Thank You For Being Late", but it's all about how do we thrive as humans in the age of accelerations? Because the theory is we're not getting enough time to catch our breath now between pendulum swings. It's interesting. Same thing happened in cellular technology. I didn't know until I started doing this job, but 1G was real for about... It was the dominant form of networking for 17 years for mobile networking. Then 2G was for around 11. 3G was seven-ish. 4G looks like it's going to be six. So technology just keeps quickening. And it makes the amount of time we get to be horizontal and catch our breath as the industry is stable, there's always an inflection of some sort going on in our industry. And so change is absolutely the new normal. >> Yeah. And some of these things are really hard to predict. I mean, remember TCP/IP used to be this old, reliable protocol that runs the world. >> Exactly right. >> I want to ask you about... Last question is as a service initiative of Project Apex or Apex it's called. And that's obviously not just some kind of gimmick. I mean, that affects the strategy of the entire organization, the way in which customers want to consume the product or platform strategies now. How does that as a service pricing model affect the business that we've been talking about for the last 10 or 15 minutes? >> Well, the good news for us, those of us at the company working on Edge and telecom and all of that sort of stuff is we're actually building the business under the Apex philosophy, right? So our design center out of the gate is as a service. Michael made the observation a long time ago within our leadership team that, back to my comment, that workloads are like water. They seek their ground. There's a difference between where a workload belongs and the interest in a particular operating model or excuse me, a particular consumption model. And get they've been combined for a long time, right? The only way to get the, as a service consumption model, was through public cloud infrastructure. But it turns out that the right place for workload may well be on-premises not in a private data center or it may well be on the Edge not in a public cloud, but people still want to take advantage of the consumption model, right? The economics are the economics. And so for me, doing the telecom stuff, it's, as a service, the heart of the design center from a consumption model right out of the gate, which is frankly easier than trying to retrofit everything else. >> Right. >> But nonetheless, for us as a company, it's just an opportunity to give our customers the choice that they want in terms of not only what they acquire, but how they acquire it. >> Well Dennis, I always love talking to you. You're such a clear thinker and you've obviously gone deep into some of these topics. And good luck in the role in the telco world. It's obviously a huge opportunity. Everybody's really excited about it. And thank you for coming on theCUBE. >> All right. Thank you, Dave. It's been a pleasure. Nice chatting with you. >> Alright. And thank you for watching, everybody. This is theCUBE's coverage of Dell Tech World 2020, the virtual cube. Keep it right there. We'll be right back right after this short break. (relaxed music)

>> From the SiliconANGLE media office in Boston, Massachusetts, it's theCUBE. Now, here's your host, Dave Vellante. >> Hello, everyone, and welcome to this week's episode of theCUBE Insights, powered by ETR. In this Breaking Analysis, I want to do a quasi post-mortem on AWS re:Invent, and put the company's prospects into context using some ETR spending data. First I want to try to summarize some of the high-level things that we heard at the event. I won't go into all the announcements in any kind of great detail, there's a lot that's been written out there on what was announced, but I will touch on a few of the items that I felt were noteworthy and try to give you some of the main themes. I then want to dig into some of the spending data and share with you what's happening from a buyer's perspective in the context of budgets, and we'll specifically focus on AWS's business lines. And then I'm going to bring my colleague Stu Miniman into the conversation, and we're going to talk about AWS's hybrid strategy in some detail, and then we're going to wrap. So, the first thing that I want to do is give you a brief snapshot of the re:Invent takeaways, and I'll try to give you some commentary that you might not have heard coming out of the show. So, to summarize re:Invent, AWS is not being on rinsing and repeating, they have this culture of raising the bar, but one thing that doesn't change is this shock and awe that they do of announcements, it comes out each year, and it's obvious. It's always a big theme, and this year Andy Jassy really wanted to underscore the company's feature and functional lead relative to some of the other cloud providers. Now the overarching theme that Jassy brought home in his keynote this year is that the cloud is enabling transformation. Not just teeny, incremental improvement, he's talking about transformation that has to start at the very top of the organization, so it's somewhat a challenge and an appeal to enterprises, generally versus what is often a message to startups at re:Invent. And he was specifically talking to the c-suite here. Jassy didn't say this, but let me paraphrase something that John Furrier said in his analysis on theCUBE. He said if you're not born in the cloud, you basically better find the religion and get reborn, or you're going to be out of business. Now, one of the other big trends that we saw this year at re:Invent, and it's starting to come into focus, is that AWS is increasingly leveraging its acquisition of Annapurna with these new chip sets that give it higher performance and better cost structures and utilization than it can with merchant silicon, and specifically Intel. And here's what I'll say about that. AWS is one of the largest, if not the largest customer of Intel's in the world. But here's the thing, Intel wants a level playing field. We've seen this over the years, where it's in Intel's best interest to have that level playing field as much as possible, in its customer base. You saw it in PCs, in servers, and now you're seeing it in cloud. The more balanced the customer base is, the better it is for Intel because no one customer can exert undue influence and control over Intel. Intel's a consummate arms dealer, and so from AWS's perspective it makes sense to add capabilities and innovate, and vertically integrate in a way that can drive proprietary advantage that they can't necessarily get from Intel, and drive down costs. So that's kind of what's happening here. The other big thing we saw is latency, what Pat Gelsinger calls the law of physics. Well a few years ago, AWS, they wouldn't even acknowledge on-prem workloads, and Stu and I are going to talk about that, but clearly sees hybrid as an opportunity now. I'm going to talk more on detail and drill into this with Stu, but a big theme of the event was moving Outposts closer to on-prem workloads, that aren't going to be moving into the cloud anytime soon. And then also the edge, as well as, for instance, Amazon's Wavelength announcement that puts Outposts into 5G networks at major carriers. Now another takeaway is that AWS is unequivocal about the right tool for the right job, and you see this really prominently in database, where I've counted at least 10 purpose-built databases in the portfolio. AWS took some really indirect shots at Oracle, maybe even direct shots at Oracle, which, Oracle treats Oracle Database as a hammer, and every opportunity as a nail, antithetical to AWS's philosophy. Now there were a ton of announcements around AI and specifically the SageMaker IDE, specifically Studio, SageMaker Studio, which stood out as a way to simplify machine intelligence. Now this approach addresses the skillset problem. What I mean by that is, the lack of data scientists to leverage AI. But one of the things that we're kind of watching here is, it's going to be interesting to see if it exacerbates the AI black box issue. Making the logic behind the machines' outcomes less transparent. Now, all of this builds up to what we've been calling next-gen cloud, and we're entering a new era that goes well beyond infrastructure as a service, and lift and shift workloads. And it really ties back to Jassy's theme of transformation, where analytics approaches new computing models, like serverless, which are fundamental now, as is security, and a topic that we've addressed in detail in prior Breaking Analysis segments. AWS even made an announcement around quantum computing as a service, they call it Braket. So those are some of the things that we were watching. All right, now let's pivot and look at some of the data. Here's a reminder of the macro financials for AWS, we get some decent data around AWS financials, and this chart, I've showed before, but it's AWS's absolute revenue and quarterly revenue year on year with the growth rates. It's very large and it's growing, that's the bottom line, but growth is slowing to 35% last quarter as you can see. But to iterate, or reiterate, we're looking at a roughly 36 billion dollar company, growing at 35% a year, and you don't see that often. And so, this market, it still has a long way to go. Now let's look at some of the ETR tactical data on spending. Now remember, spending attentions according to ETR are reverting to pre-2018 levels, and are beginning to show signs of moderation. This chart shows spending momentum based on what ETR calls net score, and that represents the net percentage of customers that are spending more on a particular platform. Now, here's what's really interesting about this chart. It show the net scores for AWS across a number of the company's markets, comparing the gray, which is October '18 survey, with the blue, July '19, and the yellow, October '19. And you can see that workspaces, machine learning and AI, cloud overall, analytic databases, they're all either up or holding the same levels as a year ago, so you see AWS is bucking the trend, and even though spending on containers appears to be a little less than last year, it's holding firm from the July survey, so my point is that AWS is really bucking that trend from the overall market, and is continuing to do very very well. Now this next slide takes the same segments, and looks at what ETR refers to as market share, which is a measure of pervasiveness in the survey. So as you can see, AWS is gaining in virtually all of its segments. So even though spending overall is softening, AWS in the marketplace, AWS is doing a much better job than its peers on balance. Now, the other thing I want to address is this notion of repatriation. I get this a lot, as I'm sure do other analysts. People say to me, "Dave, you should really look into this. "We hear from a lot of customers "that they moved to the cloud, "now they're moving workloads back on-prem "because the cloud is so expensive." Okay, so they say "You should look into this." So this next chart really does look into this. What the chart shows is across those same offerings from AWS, so the same services, the percent of customers that are replacing AWS, so I'm using this as a proxy for repatriation. Look at the numbers, they're low single digits. You see traditional enterprise vendors' overall business growing in the low single digits, or shrinking. AWS's defections are in the low single digits, so, okay, now look at this next chart. What about adoptions, if the cloud is slowing down, you'd expect a slowdown in new adoptions. What this data shows is the percent of customers that are responding, that they're adding AWS in these segments, so there's a new platform. So look, across the board, you're seeing increases of most of AWS's market segments. Notably, in respondents citing AWS overall at the very rightmost bars, you are admittedly seeing some moderation relative to last year. So that's a bit of a concern and clearly something to watch, but as I showed you earlier, AWS overall, that same category, is holding firm, because existing customers are spending more. All right, so that's the data portion of the conversation, hopefully we put that repatriation stuff to bed, and I now want to bring in Stu Miniman to the conversation, and we're going to talk more about multicloud, hybrid, on-prem, we'll talk about Outposts specifically, so Stu, welcome, thank you very much for coming on. >> Thanks Dave, glad to be here with you. >> All right, so let's talk about, let's start with multicloud, and dig into the role of Kubernetes a little bit, let me sort of comment on how I think AWS looks at multicloud. I think they look at multicloud as using multiple public clouds, and they look at on-prem as hybrid. Your thoughts on AWS's perspective on multicloud, and what's going on in the market. >> Yeah, and first of all, Dave, I'll step back for a second, you talked about how Amazon has for years had shots against Oracle. The one that Amazon actually was taking some shots at this year was Microsoft, so, not only did they talk about Oracle, they talked about customers looking to flee their SQL customers, and I lead into that because when you talk about hybrid cloud, Dave, if you talked to any analyst over the last three, four years and you say "Okay, what vendor is best position in hybrid, "which cloud provider has the "best solution for hybrid cloud?" Microsoft is the one that we'd say, because their strong domain in the enterprise, of course with Windows, the move to Office 365, the clear number two player in Azure, and they've had Azure Stack for a number of years, and they had Azure Pack before that, they'd had a number of offerings, they just announced this year Azure Arc, so three, we've had at least three generations of hybrid multicloud solutions from Microsoft, Amazon has a different positioning. As we've talked about for years, Dave, not only doesn't Amazon like to use the words hybrid or multicloud, for the most part, but they do have a different viewpoint. So the partnership with VMware expanded what they're doing on hybrid, and while Andy Jassy, he at least acknowledges that multicloud is a thing, when he sat down with John Furrier ahead of the show, he said "Well, there might be reasons why customers "either there's a group inside "that has a service that they want, "that they might want to do a secondary cloud, "or if I'm concerned that I might fall out of love "with this primary supplier I have, "I might need a second one." Andy said in not so, just exactly, said "Look, we understand multicloud is a thing." Now, architecturally, Amazon's positioning on this is that you should use Amazon, and they should be the center of what you're doing. You talked a lot about Outposts, Outposts, critical to what Amazon is doing in this environment. >> And we're going to talk about that, but you're right, Amazon doesn't like to talk about multicloud as a term, however, and by the way, they say that multicloud is more expensive, less secure, more complicated, more costly, and probably true, but you're right, they are acknowledging at least, and I would predict just as hybrid, which we want to talk about right now, they'll be talking about, they'll be participating in some way, shape, or form, but before we go to multicloud, or hybrid, what about Kubernetes? >> So, right, first of all, we've been at the KubeCon show for years, we've watching Kubernetes since the early days. Kubernetes is not a magic layer, it does not automatically say "Hey, I've got my application, I can move it willy-nilly." Data gravity's really important, how I architect my microservices solution absolutely is hugely important. When I talk to my friends in the app dev world, Dave, hybrid is the way they are building things a lot, if I took some big monolithic application, and I start pulling it apart, if I have that data warehouse or data store in my data center, I can't just migrate that to the cloud, David Floyer for years has been talking about the cost of migration, so microservice architecture's the way most customers are building, a hybrid environment often is there. Multicloud, we're not doing cloud bursting, we're not just saying "Oh hey, I woke up today, "and cloud A is cheaper than cloud B, "let me move my workload." Absolutely, I had a great conversation with a good Amazon customer that said two years ago, when they deployed Kubernetes, they did it on Azure. You want to know why, the Azure solution was more mature and they were doing Azure, they were doing things there, but as Amazon fully embraced Kubernetes, not just sitting on top of their solution, but launched the service, which is EKS, they looked at it, and they took an application, and they migrated it from Azure to Amazon. Now, migrating it, there's the underlying services and everybody does things a little bit different. If you look at some of the tooling out there, great one to look at is HashiCorp has some great tooling that can span across multiple clouds, but if you look at how they deploy, to Azure, to Google, to AWS, it's different, so you got to have different code, there's different skillsets, it's not a utility and just generic compute and storage and networking underneath, you need to have specific skills there, so Kubernetes, absolutely when I've been talking to users for the last few years and saying "Why are you using Kubernetes?" The answer is "I need that eject lever, "so that if I want to leave AWS with an application, "I can do that, and it's not press a button and it's easy, "that easy, but I know that I can move that, "'cause underneath the pods, and the containers, "and all those pieces, the core building blocks "are the same, I will have to do some reconfiguration," as we know with the migration, usually I can get 80 to 90 percent of the way there, and then I need to make the last minute-- >> So it's a viable hedge on your AWS strategy, okay. >> Absolutely, and I've talked to lots of customers, Amazon shows that most cloud Kubernetes solutions out there are running on Amazon, and when I go talk to customers, absolutely, a lot of the customers that are doing Kubernetes in the public cloud are doing that on Amazon, and one of the main reasons they're using it is in case they do want to, as a hedge against being all-in on Amazon. >> All right, let's talk about Outposts, specifically as part of Amazon's hybrid strategy, and now their edge strategy as well. >> Right, so Azure Stack, I mentioned earlier from Microsoft has been out there for a few years. It has not been doing phenomenally well, when I was at Microsoft Ignite this year, I heard basically certain government agencies and service providers are using it and basically acting, delivering Azure as a service, but, Azure Stack is basically an availability zone in my data center, and Amazon looked at this and says "That's not how we're going to build this." Outposts is an extension of your local region, so, while people look at the box and they say, I took a picture of the box and Shu was like, "Hey, whose server and what networking card, "and the chipset and everything," I said "Hold on a second. "You might look at that box, "and you might be able to open the door, "but Amazon is going to deploy that, "they're going to manage that, "really you should put a curtain in front of it "and say pay no attention to what's behind here, "because this is Amazon gear, it's an Amazon "as a service in your data center, "and there are only a few handful of services "that are going to be there at first." If I want to even use S3, day one, the Amazon native services, you're going to just use S3 in your local region. Well, what if I need special latency? Well, Amazon's going to look at that, and see what's available, so, it is Amazon hardware, the Amazon software, the Amazon control plane, reaching into that data center, and very scalable, it's, Amazon says over time it should be able to go to thousands of racks if you need, so absolutely that cloud experience closer to my environment, but where I need certain applications, certain latency, certain pieces of data that I need to store there. >> And we've seen Amazon dip its toe into the hybrid on-prem market with Snowball and Greengrass and stuff like that before, but this is a much bigger commitment, one might even say capitulation, to hybrid. >> Well, right, and the reason why I even say, this is hybrid, but it's all Amazon, it is not "Take my private cloud and my public cloud "and tie 'em together," it's not, "I've taken cloud to customer" or IBM solution, where they're saying "I'm going to put a rack here "and a rack there, and it's all going to work the same." It is the same hardware and software, but it is not all of the pieces-- >> VMware and Outposts is hybrid. >> Really interesting, Dave, as the native AWS solution is announced first here in 2019, and the VMware solution on Outposts isn't going to be available until 2020. Draw what you will, it's been a strong partnership, there are exabytes of data in the VMware cloud on AWS now, but yeah, it's a little bit of a-- >> Quid pro quo, I think is what you call that. >> Well I'd say Amazon is definitely, "We're going to encroach a little bit on your business, "and we're going to woke you into our environment, too." >> Okay, let's talk about the edge, and Outposts at the edge, they announced Wavelength, which is essentially taking Outposts and putting it into 5G networks at carriers. >> Yeah, so Outposts is this building block, and what Amazon did is they said, "This is pretty cool, "we actually have our environment "and we can do other things with it." So sometimes they're just taking, pretty much that same block, and using it for another service, so one that you didn't mention was AWS Local Zones. So it is not a whole new availability zone, but it is basically extending the cloud, multi-tenant, the first one is done for the TME market in Los Angeles, and you expect, how does Amazon get lower latency and get closer, and get specialized services, local zones are how they're going to do this. The Wavelength solution is something they built specifically for the telco environment. I actually got to sit down with Verizon, this was at least an 18 month integration, anybody that's worked in the telco space knows that it's usually not standard gear, there's NEBB certification, there's all these things, it's often even DC power, so, it is leveraging Outposts, but it is not them rolling the same thing into Verizon that they did in their environments. Similar how they're going to manage it, but as you said, it's going to push to the telco edge and in a partnership with Verizon, Vodafone, SK, Telecom, and some others that will be rolling out across the globe, they are going to have that 5G offering and this little bit, I actually buy it from Amazon, but you still buy the 5G from your local carrier. It's going to roll out in Chicago first, and enabling all of those edge applications. >> Well what I like about the Amazon strategy at the edge is, and I've said this before, on a number of occasions on theCUBE Breaking Analysis, they're taking programmable infrastructure to the edge, the edge will be won by developers in my view, and Amazon obviously has got great developer traction, I don't see that same developer traction at HPE, even Dell EMC proper, even within VMware, and now they've got Pivotal, they've got an opportunity there, but they've really got a long way to go in terms of appealing to developers, whereas Amazon I think is there, obviously, today. >> Yeah, absolutely true, Dave. When we first started going to the show seven years ago, it was very much the hoodie crowd, and all of those cloud-native, now, as you said, it's those companies that are trying to become born again in the cloud, and do these environments, because I had a great conversation with Andy Jassy on air, Dave, and I said "Do we just shrink wrap solutions "and make it easy for the enterprise to deploy, "or are we doing the enterprise a disservice?" Because if you are truly going to thrive and survive in the cloud-native era, you've got to go through a little bit of pain, you need to have more developers. I've seen lots of stats about how fast people are hiring developers and I need to, it's really a reversal of that old outsourcing trend, I really need IT and the business working together, being agile, and being able to respond and leverage data. >> It's that hyperscaler mentality that Jassy has, "We got engineers, we'll spend time "on creating a better mousetrap, on lowering costs," whereas the enterprise, they don't have necessarily as many resources or as many engineers running around, they'll spend money to save time, so your point about solutions I think is right on. We'll see, I mean look, never say never with Amazon. We've seen it, certainly with on-prem, hybrid, whatever you want to call it, and I think you'll see the same with multicloud, and so we watch. >> Yeah, Dave, the analogy I gave in the final wrap is "Finding the right cloud is like Goldilocks "finding the perfect solution." There's one solution out there, I think it's a little too hot, and you're probably not smart enough to use it just yet. There's one solution that, yeah, absolutely, you can use all of your credits to leverage it, and will meet you where you are and it's great, and then you've got Amazon trying to fit everything in between, and they feel that they are just right no matter where you are on that spectrum, and that's why you get 36 billion growing at 35%, not something I've seen in the software space. >> All right, Stu, thank you for your thoughts on re:Invent, and thank you for watching this episode of theCUBE Insights, powered by ETR, this is Dave Vellante for Stu Miniman, we'll see you next time. (techno music)

>> Announcer: Live, from Orlando Florida, it's theCUBE! Covering Microsoft Ignite, brought to you by Cohesity. >> Welcome back, everyone, to theCUBE's live coverage of Microsoft Ignite. We are here at the Orange County Convention Center in the middle of the show floor, one of Microsoft's biggest shows, 26,000 people from around the globe. I'm your host Rebecca Knight along with my cohost, Stu Miniman, and we're joined by a third cohost, but he is also the Principal CTO Advisor, Keith Townsend. Thank you so much for coming on theCUBE. >> Thanks for having me, guys. >> It's a pleasure to have you. So, you come to a lot of these shows, I'm interested in your thoughts and impressions of Microsoft Ignite 2019. >> So, I'm part of the V community, which is a pretty close knit community, very focused on one part of the whole IT pitch, which is infrastructure. It is amazing coming to a show like Microsoft Ignite where the breadth of content is so wide, and the conversation, so wide and, surprisingly, deep. This is been one of my, I think, favorite shows of the year so far. >> Talk about the content, you're absolutely right, we had so many product announcements, it felt like an Amazon Show, we were saying, because of the number of products that were being announced and demoed here. 87 pages from the Comms Team, so, does this feel like a different era for the company itself? >> You know what, Microsoft announced, I think UiPath has some crazy over billion dollar evaluation. Microsoft wildly announced that they're entering RPA, Robotic Process Automation, they're challenging SAP when it comes to data warehousing and data analytics. And then, they just happen to announce that, oh, yeah, by the way, we're making Kubernetes easier. Then, there's still the Teams announcements. The amount of content and the areas that Microsoft is going in, just to highlight it, Azure Arc replicates data, one of the jobs is replicate data, and they said they'll replicate data to AWS Cloud. Microsoft, great position. >> Keith, as you're alluding to, Microsoft has a large portfolio of applications. If you think business productivity, you're probably using Microsoft. Everything from Teams, that we're hearing a bunch about, to, of course, O365 is the solution that gave everybody the green light to go SaaS-ify as many of your applications as you will, and Arc, very much from what I've seen so far, takes that application specific view of Kubernetes, we know Kubernetes is supposed to help be that platform to build on top of, but, I've tended to hear a very infrastructure view of here's what you'll build in your data center and the compute network and storage that you need to think about, here's the IAS that it might live on. But, when you talk about Arc, they're talking about it's about SQL and databases and how those pieces go together. And this is a view for Microsoft, but, if you want to go do open shift, if you want to do spring with a Pivotal VMware or Tanzu with there, Microsoft, of course, is saying that that's your option but would love your view point so far as your Arc and where Microsoft sits in this broader ecosystem today. >> So, I'm coming off fresh a conversation with David Armor, the PM for Microsoft Arc for Azure stack, and their attention to detail is amazing. You know, I'm not the world's biggest Kubernetes fan, for some of the very reasons that you mentioned. It's too much attention to the details in order to provide a Kubernetes experience that developers will accept. Microsoft, a big developer focused company, so when you look at Arc and what it does for Kubernetes on Azure stack, it makes the provisioning, the storage networking, et cetera, invisible so that you can take Microsoft's cognitive services, deploy them on Azure stack, and just consume those services. Microsoft, again, when you look at it from a different angle, when you're not taking the infrastructure angle added and you're doing the whiz bang features of making sure that Kubernetes can do X, Y, and Z, more importantly, can I use it to build applications is Microsoft's approach, and you can see it in the Arc and how they approach it in the Azure stack. >> Absolutely, and you're talking, right now, about this app development for everyone. We had Satya Nadella, yesterday, talking about democratizing computing, anyone can do it, AI for all, too. What are the most exciting new tools that you're seeing, and what are the kinds of conversations that you're having with developers around these new tools? >> So, I just talked to a professional services architect, or an architect for professional services, one of the global big four's, and he was telling me that they've deployed RPA to the entire organization of over 100,000 consultants and end users, so that they can build robots to power the next phase of productivity increases within their organization. No rules, no constraints, just here's the tool, go out and do. Microsoft talked about 2.5 million non-technology focused developers, it is, I think, a key theory of the CTO advisors that their future of enterprise IT is that companies, like Microsoft, then, will push AI, machine learning, these robotic automation processes down to the end users so that they're creating the content. There's just not enough of Keiths and Stus in the world to do this by hand. So, great vision. >> And Keith, you brought up the SIs, and you've worked for some of the big SIs in the past. How is Microsoft doing out there? We've seen with Cloud and AI, the biggest guys, rolling out armies of people to help integrate this, to help customers adopt this. Cloud and AI, Cloud, specifically, was supposed to be cheap and easy and we know it's neither of those two things. So, if you look at Cloud and AI, how is Microsoft to be a partner with and I would love a little compare and contrast to the Vmwares and AWSs of the world. >> So, if you look, let's take a look at VMware, I'm a big VMware fan, but one of the things that if you're a VMware VAR, or you're in VMware period, if you go outside of your lane, that infrastructure lane, you go to have conversations, the technology is there. You can use VMware, vRealize, automation suites, the CloudHealth, the Heptio, they have the individual components, technology components, but they absolutely need the Pivotals of the world to go in and add credence to their talking points around these products because they don't have that reputation to come in and have the conversation with the CMOs or the application developers. Microsoft on the other hand, developers, developers, developers. And then, they also have Microsoft Dynamics, we ran into a customer, who was desperately just searching out, she came to the conference expecting to see Dynamic experts, and I'm sure she found them. Microsoft has the ecosystem to support their vision. >> One of the things we've been talking about on theCUBE this week, at Ignite, is that it seems like a different kind of Microsoft, it seems like one that is, not only embracing customers who choose Microsoft in addition to other companies, but championing them and supporting them and saying, "whatever you want, "we're meeting you where you are." Have you found that, and is that striking to you, based on the Microsoft of Yore, which was more proprietary about where it's customers went for it's technology. >> So, we mainly cover enterprise tech, but, I think today or tomorrow, the Surface Pro X gets released, which is an arm based device, that runs full version of Windows. I was in one of the Lightning talks, Microsoft Lightning talk, on a completely different topic, and at the bottom, they had a logo for UiPath, Automate Anywhere and Blue Prism, three of the, I think, leaders in a space of RPA. And they were talking about the integrations that Microsoft has gone on with these companies, and their own power automate was not even mentioned as part of that session. So, Microsoft is meeting customers where they're at. I think the AWS, the example for Arc, replicating to AWS, customers have AWS, they're the biggest Cloud provider, Microsoft isn't closing their eyes to it. >> Yeah, well, we noticed the biggest thing repeated over and over again in the key note yesterday was trust. And while the Microsoft of old days was you're going to buy my OS, and my apps, and everything Microsoft on top of it, and we're going to maximize our licensing, the Microsoft today is those choices. We talked to UiPath yesterday, they're not worried about their relationship with Microsoft. When I talked to the ecosystem of partners here, they trust that they can work with Microsoft. Compare that to some others out there in the industry, and the big Hyperscalers, there might not be as much trust. What I'm curious about, from you Keith, is do customers see that? Do they understand that today is a different Microsoft than the one that we grew up with? >> So, some of the conversation on Twitter, just remotely, people not here, this is the best Ignite I've ever seen. People who are not even here, this is from the keynote yesterday. I think customers are starting to embrace Microsoft and trust Microsoft. I think there's still some hold out, some people who remember this sting of forced to use Microsoft management suites on products that probably didn't integrate well with those suites. But, as that sting starts to subside, you have to look at it objectively and say, "Microsoft is a different company." This is not a show I think I would have enjoyed three years ago. >> What's driving it though? This is something we're seeing in the technology industry at large, this understanding of customers needing different things and wanting best in breed. But are there other elements that we're not privy to, would you say? >> I think it's the democratization of technology via Cloud. I talked to a just regular, small business owner. She runs a trucking business, she uses her computer as a tool, it was a five year old device, she really didn't care, did the job that she needed to do. We talked a business challenge that she was having, and I described Cloud in general and she never even considered Cloud as a thing. She just said, "you know what, "I want this solution and if it's Microsoft AWS or Google that provides it, or even VM Works." She didn't care, she wanted to buy it. And that relationship wasn't a traditional ISV, MSP, these are, I think, business owners and business leaders are being approached with, whether it's ISVs or consultants and business advisors, and they're being advised to adopt these technologies, regardless of the source. There's no loyalty anymore to just Microsoft. Remember when you bled blue? Whether it was IBM blue or Microsoft blue. I read an unfortunate article on one of the big ERP providers had a 100 million dollar failure, and the company just decided, you know what, we're not going to go with just one provider anymore, we're just going to go with best of breed across these business processes. >> So what does that mean for the competitive landscape? I mean, we talked a lot about this. Does Microsoft really have a shot at taking on AWS or will it always be number two. Well, Microsoft won a 10 billion dollar JEDI contract from the US. I wrote about this in my newsletter last week, is that one billion dollars over 10 years will make Microsoft Azure better. You can't help but to have that type of discipline that comes from a contract like that impact Azure. Will they catch up with Microsoft, I mean, with AWS? AWS is still a very, very small fraction of the overall IT landscape. That business owner I talked to never heard of AWS. 50,000 person conference in a month, she only knew Amazon as a book seller. So, to say that Microsoft won't catch up with AWS is a very, very short view of the landscape. >> We're just scratching the surface when it comes to Cloud. >> Keith, what other thing have you seen at the show jumping out at you? You said you might not have enjoyed the show three years ago so what are some of things that make this show enjoyable? I know for me, it is a different community than the V community out there, there are a lot of overlaps, a lot of friendly faces that I know here, but community, diversity, inclusion, super strong here, would love your comment on that and any other takeaways. >> So, someone pointed out to me that I didn't notice and I'm happy I didn't notice it, was that there is a lot of women at this show, and I looked up and I'm like wow, the lines for men's bathroom aren't as long. And that's a nice thing because I don't think it's just facilities. It is a massively diverse show, not just from a ethnicity and gender perspective, but from career levels and age groups. There's Millennials all the way up to Boomers, and the conversations, the conversations that I've had, I'm really surprised with. Straight on business conversations, to deep and dirty, you know what these are the Cloud providers Azure provides for Kubernetes. That's super geeky, and that conversation's all around best. Infrastructure, application, business, and then even social, I had that social conversation about diversity, and for a change, I wasn't the one that brought up the conversation. >> You know, that's a really good point, and even just even here, I mean, I know you made the schedule, which I salute you, because we are having many more women, many more people of color on our stage, which is reflective of who's here. >> And it's easier at this show than it is at most, as opposed to please find me some more underrepresented or diversity there. And luckily, there is a lot of options at a show like this. >> Yeah, the pool just hasn't, and other shows, the pool just isn't very big. Normally, I can usually say at a show, I'm the tall black guy with the beard, and hey, I'm the tall black guy with the beard, and this show is not that case. >> No, there's more, there's more, exactly. >> Well, Keith Townsend, thank you so much for coming on, a pleasure having you. >> Thank you, Rebecca. >> I'm Rebecca Knight for Stu Miniman and Keith Townsend, you are watching theCUBE. (techno music)

>> Narrator: Live from Orlando, Florida, it's theCUBE covering Microsoft Ignite. Brought to you by Cohesity. >> Welcome back everyone to theCUBE's live coverage of Microsoft Ignite. We are wrapping up a three, the first day of a three-day show. I'm your host Rebecca Knight, along with my co-host Stu Miniman. We are joined by Scott Lowe. He is the CEO of ActualTech Media. Thanks so much for coming on theCUBE. >> Thank you for having us. >> And also David Davis, director of events at ActualTech Media. Thank you so much for coming on. >> Thank you. >> So, you are a former CIO that started ActualTech Media in 2012, tell our viewers, a little bit about Actual, what was the vision and what did you set out to create? What kind of content were you setting out to create? >> You know what we started and what we have today are actually very, very different things. We started off to create sort of an empire of websites that provide content to people. What we do now is we're helping connect enterprise IT vendors with buyers, that's really what we've settled on over the years. We've found our path about six years ago, five years ago, and we've been executing on that ever since. And that's our mission, is to help buyers find the right enterprise IT solutions. >> So how do you do that? I mean, what's the lead generation that it takes? >> Sure. I mean we basically for our clients who are companies including Cohesity and companies like it, we do event series we call MegaCast, EcoCast, virtual summits, webinars, things like that. We have a significant audience that we draw from to drive those events. And we also created our own content series, we call Gorilla Guide, which is a series of books to help educate IT buyers about solutions on the market about different technologies and try to help them understand the lay of an ever-evolving landscape that seems to be changing faster than it ever has before. >> Yeah, and actually one of the reasons I invited the two of you is, you both have deep background in this environment. Scott, before the Gorilla Guides, you wrote big books about Microsoft, and David, you've been training people on this ever environment but the pace is faster. You're talking about it's changing all the time. So I'd love for both of you, just here 2019 Microsoft Ignite, first impressions, how you think of Microsoft in the ecosystem. David, let's start with you. >> I mean, it's my third Microsoft Ignite and every time I come here I'm really blown away by kind of the scope of the show compared to the typical infrastructure shows that I go to. Those shows are more you know, the plumbing of the data center. This show is the keynote, is like using AI and ML to cure cancer and provide food for the world and it's just, like, really empowering and exciting and I find it very personally exciting. And Microsoft Azure just seems to be on a breakneck pace to catch up with AWS and Office 365 and all these innovations they keep coming out with, have been really impressive so I've been excited about the show, what about you Scott? >> Same, I mean, I think that when we talk about other shows, we are really looking at plumbing. That's a good word. When we're here we're looking at real solutions that are helping solve big problems. And because Microsoft has such a wide ecosystem from which to, in which it participates, from productivity and enterprise to driving quantum computing, to artificial intelligence to help tractors talk to the internet. I mean just, it does everything and it does it increasingly well. Microsoft hasn't always been thought of as the most innovative company in the world but I think in the last few years we've seen a different Microsoft and I think that has a lot to do with Satya, and the leadership change but it also has to do with just a renewed vision for what the future looks like in the terms of IT. >> And what does that future look like? I mean it is interesting because Microsoft is a middle-aged company compared to all these young upstarts that really, that much more DNA of innovation, of course Microsoft has innovation in its DNA but how would you describe what is driving the change at Microsoft? This is not your father's Microsoft. >> Honestly, the Microsoft we see today and the Microsoft we saw 10 years ago are not the same company. This is, I feel like Microsoft is almost a startup again. And I think if you look at Microsoft as a company, it has its hands in so much that each individual silo is almost a startup feel in the way it's brought to market. Let's just look at Azure. I mean, Azure has been playing catch up in a lot of ways to AWS for a lot of years just like a lot of smaller companies are playing catch up to some of their bigger cousins in the market. But Azure has proven itself, it's still not quite as capable as its bigger, you know, its bigger sibling AWS but it's more capable than GCP for example. But as Microsoft continues to iterate that service, it gets ever more capable, it gets ever deeper into the organization and I think it's something that I see that across Microsoft and everything that it's doing. It's not just Azure that's like this. It's like this with, you know, we've been looking at Windows virtual desktops. That's not all that sexy and exciting on the surface, no pun intended on surface, sorry. But it's something that the world needs at this point. And how we're trying to handle computing in the enterprise as we move into 2020. >> There's so much, you know, there's a few shows I go to every year where you just drink from the fire hose when you go to the keynote. This absolutely is one. Amazon absolutely is one where you come through in the breath and depth of what they offer. So we've spent a lot time saying something like Azure Arc, it is early. And still trying to understand exactly where that fits, by the end of the day, I'm like, wait, it's management but actually it's highly tied to the application, which really is the strength of Microsoft if you talk about what Microsoft knows. Microsoft knows your apps, you're running so many of those apps, not just Office but SQL and some of the various pieces. I'd love to hear what, give me one or two things that jumped out at you either that you want to dig into or that you've been saying "Oh I've been waiting for that." >> I mean I was really impressed with the technical keynote where they talked about Azure Stack Edge and they have this mini server that can be ruggedized or even put in a backpack, and he had the demo going with the server, a person sitting next to him using the server and he said "It has battery power," so he pulled the power plug on it and it kept working and then he said "And it's rugged," and he just dropped it on the ground and it bounced on the ground and he said "See, the demo just keeps on running." So I was like okay, that's cool, that's pretty impressive. >> Yeah we actually had the HPE, an HPE representative on the program. They're super excited to have their gear in the keynote and those of us with a hardware background do like to wrap our arms around some sheet metal every once in a while and touch this thing, software might be eating the world. >> We call you server huggers too. >> Exactly, am I an Edge hugger now? >> I guess you probably are. >> Yeah it's free shruggs. >> When it comes to, in my opinion, Arc and Edge, I'm sorry, Azure Stack, I think it shows some incredible opportunity for Microsoft moving forward. I mean Microsoft has a formidable presence in the enterprise and not just the enterprise, from the SMB to the mid-market to the enterprise. Everybody, almost, has something Microsoft. So there's an opportunity for Microsoft to further that incursion into the enterprise that can help them be a driver for Azure. Because when you think about a lot of the challenges people have with cloud it's around adoption and integration. That's not quite a soft problem but close enough when you start thinking about the myriad of technologies that Microsoft is bringing out. >> Yeah, so Scott I think your background, you worked in some of the commercial markets, you talk about the education space, areas where Microsoft had a strong history. Are they still as prominent today as they might've been back in the days when you were a CIO? >> Yes and no, it depends on the organization. If I look K12, I think Google's had a lot of inroads there because of Google Apps for Education, whether that's good or bad is really a different opinion but I think Google's taken a lot of Microsoft's market share there. And higher education, we still see a lot of Google colleges and universities of course, but we see a lot with O365. And a lot of that is because of the pricing which you can't beat free. But it also has to do with the capability that the Stack brings to bare. So I think that Microsoft is playing differently than they used to, not necessarily, probably a little bit more strongly in some ways and weaker in others. >> Another, I'd love to hear you say, think about is, the Microsoft of old I think of as rather proprietary and you will do all Microsoft. We had one of the Microsoft partner executives on the program today and he was talking about embracing VMware, embracing Red Hat, not something that you would've thought of Microsoft in the past. How do you think of Microsoft just as a trusted partner in the ecosystem today? >> Yeah, you bring up that word trust and in fact we were talking about that at lunch, Microsoft, we feel like has so much more trust when it comes to our data, when it comes to our applications. I mean there's another cloud provider that starts with a G that's well-known for selling data, selling data that they own, you know. And he talked about in the keynote today, we protect your data and the security around your data and I feel like trust is going to be a big factor in the future when people think about which cloud should I trust? Microsoft seems like they have a leg up on some other competitors. >> I may be naive but I actually trust Microsoft and I have for a long time. There's other companies I don't trust. And Microsoft I actually do trust because for Microsoft, our data is not their resource to mine. They're using it to give me things but they're not using it to sell things to other people. Does that make sense? I mean, that is we're not the product of Microsoft. And it might be a little more expensive because of that in some ways but I think it provides that layer of trust that you're not necessarily going to get from other providers in the near term. >> So we're nearing the end of 2019, what is on deck for IT pros in 2020? I'll start with you, I want to hear both your impressions but I'll start with you. >> That's a great question, we're actually doing a big event this week. In fact and that's the topic is the pillars of IT for 2020. >> I might've done some research. >> Yeah, yeah. So I mean, in fact, I was at a local user group recently and I was asking IT professionals that very question. You know, where are you going to spend your budget in 2020? What are you going to re-architect? And there was a lot of answers around security. That was I think probably the most popular one that I heard. Automation, some people were interested in that and improving the efficiency of their infrastructure I think overall. No matter how they do it, hyperconvergence or something like that, just overall improving things to make their life easier. >> For me, I look at the role of the CIO and to look into 2020, I think we see a lot legacy challenges that are still not solved. Some new opportunities is probably a good word. Some of the legacy challenges are what's the role of IT? That's the age old question. I think we saw the next phase of IT business align with digital transformation and now we're going to look for what's next, right? 'Cause that phrase is now going out of style. But we're still looking for ways that we can do more with technology than we ever have. And as I look at some of the things that happened at the show this morning that were announced, I see a lot opportunity for CIOs and for organizations as a whole to do more than they ever have before without having to bring a whole lot more complexity to the organization. But I also think to see some of the things that have to be addressed. Security is a board level issue and it's a top issue for the CIO, it's a make or break your career type issue at this point. And I think going into 2020 as we look at some of these technologies, it becomes even more important because it's going to all require new focus on security. We have an opportunity around to actually solve the data analytics problem at some point here in the near future. That hasn't always been possible and now we have the tools to do it. And we have tools that can do it without having to hire a whole bunch of IT experts through some of things like companies like Microsoft can bring into market. >> Would love to get your viewpoint on the future of work. We've been saying what is the role of IT? And we say in its best light, IT helps drive innovation and actually can be a leader inside the business. But we know that the roles have been changing inside a company. Microsoft talks rather aspirationally about citizen developers, and we're going to empower everyone to be their best out there. But what does that mean to the person that has been a Cis Admin or going through certifications or trying to learn the latest on hyperconvergence infrastructure and Kubernetes and the latest buzzword that they heard of? >> I mean, I think that's exciting, especially for people who are new in IT or people who have the time to invest in learning development, they were talking about power apps in the keynote. I was excited, I wanted to try it for myself, it looks fun and easy. But in reality, in the real world of IT organizations, things take time. I mean I talked to a CIO at a large bank and he said "Hey, I have 10 stand administrators "and we're going to move to hyperconvergence "when they die or retire." So things take time, that's my take, Scott. >> For me, I think it's the enabling new ways to work. If you look at ActualTech Media, we're 100% virtual. We don't have, people ask where we're headquartered, we have a PO box in North Charleston, South Carolina and the rest of us work in Microsoft Teams. For me one of the most exciting things I've looked at in the last year is Teams. I absolutely adore the tool. >> I've heard a couple of people talking about you know people thought Teams was dying and Slack was killing it but Teams is really good. What is it about it that drives your business? >> So we used to use Slack, we used Skype, and then we used Slack. And Slack was good for what it was, it's an instant messaging tool that makes sure that you can get in touch with people right away and you can share a file. What it lacks is context. Once something is scrolled off the screen, that's it, you don't ever look at it again. And what we get with Teams is an ability to provide context for the work we do. So we were working on one of our Gorilla Guide books this week collaboratively inside Teams. We had the document open in one window and we were chatting about it in a chat in Teams in the other window. But the document lived in the same channel that we were having the conversation. So enabled a great degree of collaboration that we just couldn't get with Slack. That's not to say Slack's not a great tool, for what it is, it's a great tool and I still use it for other teams, which sounds weird. But I love the ability that we've had to bring additional tools into Teams that we didn't have before. When we bought, when we bought, when we deployed Teams, we got rid of Slack, we got rid of Smartsheet and we're in the process of getting rid of Dropbox. And it wasn't 'cause we wanted to save money, I mean it's nice, but at the end of the day it's about improving workflows especially when you don't live in the same office. You don't get to talk to each other over the water cooler. >> So particularly for distributed virtual teams, Microsoft Teams. >> It's a beautiful thing >> It's a beautiful thing. >> And also even with clients, now that Teams has guest capability, we have guest teams that we work on, work with clients in the same way we work internally. So it's become a central hub for just about everything we do. Literally Teams is open on my laptop and on my phone 24/7. It's an app that never closes. >> That's a powerful endorsement. >> It is. >> Scott, thank you so much for coming on theCUBE, David thank you so much. >> Thank you for having us. >> Thank you. >> I'm Rebecca Knight for Stu Miniman, we will see you tomorrow for more of theCUBE's live coverage from Microsoft Ignite.

>>live from Orlando, Florida It's the cue covering Microsoft Ignite Brought to you by Cho He City Welcome >>back, everyone to the Cubes Live coverage of Microsoft IC Night. 26,000 people were here. The cube, the middle of the show floor. It's an exciting time. I'm your host. Rebecca Night, along with my co host, Stew Minutemen. We're joined by Barbara Homans. She is the director. Global ecosystem strategy and micro ecosystem lead at HP Thank you so much for coming on the Cube direct from Munich. Yes, Rebecca. Glad to be here. So you have You have two Rolls Global Ecosystem Strategy and Michael Microsoft's ecosystem lead. Explain how those work and how they there is synergy between those two roles. Yeah, I mean, I started >>off with the Microsoft role, but what we figured out is that actually, the world is much bigger than just one alliance, and that's why we call ourselves the Ecosystem. So it's all about driving alliances from different partner speed as I speed Eyes V's or also smaller partners in different segments and build a whole ecosystem play. That's what I'm attempting to do. >>So how do HB and Microsoft worked together. So we've >>seen partnering for 30 years strong, strong relationship with Microsoft and really nice to see. Also today, you know some of the H p e solutions on stage and even deepening our partnership. We have several areas. Probably 34 I can talk about in the next few minutes on how we work together with Microsoft specifically. >>Yeah. So? So Barbara, You know, I think most of us remember back, you know, early if you're talking about windows and office and you know HP here what's now part of HP Inc? Not sure. As many people know about all of the places that H p e Partners, obviously on the server side, it makes sense. But Azure is something. And the Azure arc announcement Help us understand, you know, Azure stack and beyond. Where? HP. Ethan with Microsoft on the Enterprise side. >>Perfect. Absolutely. We have still in Microsoft. Oh, am business where we have actually service attached with licenses. That's not going away rights. We absolutely. It's a strong business class. We work very closely around sequel with Microsoft, and that's also worried this whole azure arc announcement fits in. But it's more than just a sequel right with this as your arc. For me, it's a announcement around deepening relationships. Both. We're interested in a hybrid strategy. I really like Thio here from Satya today. How important hybrid is for Microsoft and this announcement as your ark. That's in public preview now, right? Well, give somewhat details on that. So we'd love to work with customers on that we actually our part of the public review and if anyone is interested, love to hear from customers. Please come to me, Barbara Holman's and we'll hook you up and get into the program. It's really about the hybrid piece, right that we both worked >>in Barbara H. P. E. If my understanding plays on both sides of it, it's not just in the data center with some gear there, but as you said, there's a sequel. The application side, you know, hybrid HP, you know, plays across the board, >>Indeed, So I don't know if you know about HB is actually a expert MSP partner for Azure. We got that last year. We're very proud of what I think we're one of 50 world by its partners. That also means we can actually offer Manage Service's Migration Service is helping people to move to an azure based clout. And that actually came partially because off our position off CTP Cloud Technology Partners, but also read pixie in the UK, and there are no old part off our point. Next service is group, and so as such, we have numerous customers were actually helped into the public cloud. Help them to find the right place. Because if you don't know if you've seen the video from Eric Poodle, that was part of the announcement today as well around as your ark, this is all about finding the right mix off your applications, and this is where we work together and a perfect fit. >>What are some of the biggest challenges you're seeing from your cut from your customers in terms of how you might, how Azure Arc might be the solution for them >>so as your ark? It's hard to say at this >>stage, because I just really don't work for Michael >>Self. So, yeah, we have to ask these people. But again, what I understand division is really that way will be able to manage hybrid environments in a in a better way, and again, this is what HP You know, we have a lot off our tour, of course, but we also announce that our hardware, all of that, will be available as a service within the next two for years. So we're moving in that direction in addition to Azure. And I think this will help customers to take adventures in the end. But it's hard to say Right, So you on this. This is very new. At this stage, the odds are right >>and this is a Microsoft show, not on HP show, but I I read somewhere that you had done a talk. Fear no cloud with H. P m. Our company's afraid. I mean, how would you describe the atmosphere with the companies that you work with? I worked >>in the cloud space, but for the last 10 years or longer, you know, it was on different parts off the industry there and from the early adoption. Really. People looking into you know, should I trust my data in this specific with this cloud provider or which applications am I gonna move? And I think today people have lost the fear a little bit, but they still don't know what to put where and there's applications, you do not want to move in a cloud. There's others that you for your specific company, you don't want to move, and another company may do that. And that's what we're trying to help them, right? So don't you don't have to fear the cloud you can. Actually, we can help you to adopt it at your pace in your way and so that you take most of the advantage out of it. >>But Barbara would love to hear any color you could give from the joint HP, EA and Microsoft customers very much. The announcement today feels like it completely. It's an update on the hybrid message, but A B and Microsoft have been working together on solutions like Azure Stack for a number of years. So what? What's working well today? What do you think you know? This will mean down the road a CZ. Some of these solutions start start to mature even further. >>Maybe moving to another area that HB and Microsoft worked very well together is around the modern workplace practice, and in there we just had a really nice win with Portia thing, actually in Austria, but planning to roll this out no further than that, and h b E's team has helped them to move from the current applicator from the current environment. Thio up two dates. Microsoft 3 65 Environment There's em OD in the UK and it's fast twice if I can talk about M. O D on stage here and they said yes, another customer that we should help to move to a Microsoft 3 65 environment. So there's numerous customers that trust HP with Microsoft in moving their their information to the to the clouds. Yeah, that's one example Asha Stack we have. You know, there's several customers that hard won about ashes. Takis. Difficult to talk about the customers because a lot of them are in the government sector on. So you know, there's a few that we can talk about, but they're mostly service providers, but the really big names, unfortunately, we can talk about because of the conference shit Confidentiality. Yeah, >>trust is one of the things that we keep hearing so much of it about at this conference. Satya Nadella talked about it on the main stage this morning in terms of the relationship that you have and HP standing in the technology world. How do you feel trust with customers? And how do you make sure you are maintaining that? That bond of trust and also the reputation of being a trustworthy partner? >>Yeah, I think I love you know, I love Saturdays, Point on trust because that actually makes the difference between you. Just deliver hardware and you walk away. And this is probably coming back to Azure stack Hop, as it's called now, right? You know, we've been told actually by Microsoft that we've accomplished with the customers from a delivery from a You know, we don't just walk away and say Good luck with the equipment you're on your own really helped them thio and make sure it's working for them. So for me, that's the key that you can come back to a customer afterwards and the customer will actually have you in your office again. >>Well, Barbara, I think back for most of my career what one of the hallmarks of an H. P e solution Was that the turnkey offering we know from, you know, ordering through delivery through, you know, up and running. HP has been streamlining that you know, I think back my entire career cloud has been not necessarily the simplest solutions out there. So maybe give us directionally. How does HPD partner with Microsoft on dhe your customers toe make? I would easier as WeII go through this journey >>S O s aside. Whereas your expert MSP partner a such we have done several of course trainings with Microsoft. We make sure that our people are educated on it way have, you know, with red pixy in the UK it's now part of point next, but I love to say the name because people really associate still with this a specific, strong and trustworthy team. You really build up a very good practice with Microsoft. There's, you know, local deal clinics where we really work in the specific deal. Steal by deal on how we can make it better for the customer. So a lot off local engagement. But for me, that all happens in country. Write me at a global level. I can only help them and steered a little bit. But that's also for me trust. It's a person to person relationship that happens in country. >>And would you say there are big differences country to country in terms of how willingly trust you and and and then how long it takes to build that relationship. >>So I'm gonna get in >>trouble now with some of the country. >>No, I you know the >>somewhere, even your CEO. >>You know, it's no, I mean you and I personally lift in Canada for a while, and so for me, it's some people are harder, you know, you need to get to know them. But then trust is even deeper then some of the others. But I have to say, it's all we're I mean, we're, I would say, from all those who look at h p were really a global company, right? And from this goes from Japan, Thio South Pacific too. You know, many countries in Asia will be very successful with ashes, stack specifically and always in Europe, the Middle East, all the way to North America, South America. So, I mean, that's the nice thing about HPD, I would say for the customers as well that they really get a global view on DA, a global company that can trust. >>So you're here, Ed ignite from Germany. What are the kinds of conversations you're having. And what do you think you're gonna take back with you when you go back to the office next week? So the other piece >>and we have ah, quite big. Both hear it at the event, right? We have a very nice edge line 8000 with us, which is kind of a ruggedized us or a smaller version. It's kindof almost my hand back, kind of to carry along, which has caught a lot of interest from the customers. So just standing there, watching the customers, asking, What is it? Can you tell me more about it? Rest is, you know, I love the bus and I love the actually part of the Microsoft Advisory Council for inspired, which is the partner event, right? But I love the bus to see here what's what's going on and always like to see how other people what they do, what they what they do at these events and then just Microsoft. I think it's wonderful, wonderful company. The inspiration. The story today was just into end a great story with great customer stories as well. So she does to the Microsoft team. Well done. >>Congratulations. Your gear was highlighted in the keynote this morning, so I'm sure that's driving a lot of traffic through for people Thio CC the latest. >>I would >>hope Superdome flex was there and then the actual stick. Both of them were there. So we worked hard for that. Thank you, Michael Self, for giving us the opportunity to be present and the keynote today. Well, >>thank you so much for coming on the Cube. It was a pleasure having you on Barbara. >>Thank you, Rebecca. Thank you. Stupid. >>I'm Rebecca Knight. First to minimum. Stay tuned for more of cubes. Live coverage of Microsoft ignite.

>> From the SiliconANGLE Media Office in Boston, Massachusetts, it's theCube. (techno music) Now here's your host, Dave Vellante. >> Hi everybody, this is Dave Vellante and welcome to this special Cube Insights, powered by ETR. We've been running these Breaking Analysis Segments and today we're going to talk about some spending data that shows that there's continued interest in hyperconverged infrastructure. So we've been running these segments over the last several weeks with our partner ETR. They've got a database of about 4,500 IT Practitioners and CIOs. They go out quarterly and ask spending intentions. So we've been sharing that, along with our opinions. These are completely independent segments. I want to disclose that a number of the companies that we're talking about today: Nutanix, VMware, Dell EMC, Cisco, HPE. They sponsor theCube, but they have absolutely no input into editorial. They don't affect our opinion in any way, shape or form. So let's get into it. I'm here with Stu Miniman. Stu is an expert in this field. He's covered the space. Stu, let's look at some of the fundamentals. What do people need to know... Alex, if ya put up the slide, Stu, maybe you could talk to it. >> Yeah. Dave, thanks. I've been watching you have some fun with this. I enjoyed swimming in some of the data here and as you know, Dave, we've been watching since before hyperconverged infrastructure, or HCI, was a term that everybody talked about. We've been looking at how these hyperscale trends are going to impact the Enterprise. We put out our server SAN research years and years ago, so we know all these companies really well. And despite the latest AI and cloud and everything, the data shows, HCI, the simplification of the data center, building out what we would call True Private Cloud is important today. So right, we wanted to know when you look at the data, first of all, how are the vendors doing? Who are the leaders in this space here? There were a whole number of startups that came in this space. When we first analyzed the market it was companies like Microsoft and VMware that owned the operating system we thought would be hugely important. If you look in the big names this environment: Dell partnered with everyone, of course they bought Dell, bought EMC, which included a stake in VMware. What's that relationship with Nutanix? How is that shaping the market? As well as how is cloud impacting things? Both from a spending standpoint, has cloud sucked away revenue from HCI as that specter has overhung everybody in the IT space? And also, how does HCI fit into multicloud and how does that fit? >> Okay, great. So thanks for that setup, Stu, now let's get into some of the data. Alex, if you bring up the slide, the next slide. This is spending intentions for Nutanix, VMware and some other vendors. I'll go through that. But it's basically showing Nutanix and VMware are fighting it out. You know they're in this internecine battle and in social, and (chuckles) there's a war goin' on, because there's big money to be made here. So for those of you who are familiar with these segments, this is data from Enterprise Technology Research, from their July 2019 Spending Intentions Survey. So they're asking about spending intentions for the second half of 2019. The end of the survey, out of the 4,500 people in the panel, 1,068 responded to this survey. So on the left hand side you see the vendors: Nutanix, VMware with vSAN, Dell EMC with VxRail, specifically. Then SimpliVity, and then Springpath, or Cisco. So what the chart shows is what we call, Net Score. And net score is calculated by taking the red, on the bar, which is, we're going to leave the platform, that's the dark red. The lighter red, which is, we're going to spend less in the second half. The gray, which their spending's going to be flat. The dark green, or the evergreen, which says, we're going to increase spending. And the lime green, which I'm going to add to the platform. You take the green, minus the red, you get net score. Higher the net score, the better. You can see, Nutanix and VMware with vSAN are leading the pack. And then we'll go through that. But then you see, Shared Accounts. That's the number of indications for spending that they received out of those 1068. So Stu, what is this data telling you? >> So first of all, Dave, it confirmed kind of the general market share numbers that we hear out there. The vendors that track that on quarterly. VMware has the most customers, has the largest revenue, and their largest partner for that, of course, is Dell. VMware and Dell go to market, joint product development, joint engineering, joint go to market and it's the biggest piece of vSAN, so that's where we specifically wanted to look at the VxRail. And vSAN and VxRail, doing very well. They're adding new customers; was interesting to me that you saw VxRail kind of ramping up a little more on the, attracting new companies, but also looked to be losing some on the tail end of the dark red. As opposed to vSAN in general, is a little bit more stable. We know how many thousands of customers they have out there, and Vmware's a software story as opposed to VxRail is that full appliance. Nutanix is the second horse in this two-horse race that we're really talking about here, from HCI. There's some discussion in the marketplace after two quarters being down, is Nutanix showing weakness? What's happening there? The most recent quarter announcement was that Nutanix is doing well, seems to... They had a little bit of change as they're going through their move to a software model and sorting things out with sales and marketing in their channel. The data here shows that the second half of the year looks good for Nutanix. So to some of the questions I asked in the first slide, Dave, Nutanix and VMware, of course the clear leaders in this space. SimpliVity, which was of course bought be HP, Springpath which is the hyperflex from Cisco, are far behind those two out there. And it seems that even though Dell and VMware are fighting, very much with Nutanix, that is not heavily dampening Nutanix's from the respondents in this survey. >> Okay, and just a word on the data, so you see 184 shared accounts for Nutanix, 174 for VMware and down the line. Only 42 for SimpliVity and only 18 for Springpath, and Cisco. It's an indication of the size of the install base, obviously the more shared accounts, the more mentions, the larger the install base. Again, they're statistically significant; ETR does a very good job of that. Let's look Stu, at... Oh, actually I want to make another point here. So how are these net scores? Well let's put 'em in context. The hottest net scores we've seen recently are: Snowflake, and UiPath, with 80% plus, net score. Okay, so that's really, they're off the charts, they're growing like crazy. We saw Salesforce with 55%, so, and Workday sort of in there as well. Companies that are growing share. So SAP in the 30% range, and so you see the Dell EMC, VxRail, that's kind of holding serve. It's not like, dramatically gaining share, but they're growing a little bit and then-- >> And I think it's a lot, Dave, it shows to the maturity of this market. HCI is not new, both Nutanix and VMware have thousands of customers, specifically with V's then we're talking VMware. So it was more, when I saw some of your charts, Microsoft has a similar net score. >> Right >> Well liked, good install based, still growing and the like. And brings in the discussion of when we did some cross section of the analysis looking at cloud companies and how does this impact their public cloud spend; is this detracting if this customer's also doing public cloud? And the long and the short of it is VMware and Nutanix are pretty much the same if not actually a little bit better when you talk about a customer that's looking at their overall cloud spend. So to me that really signals that both VMware and Nutanix are doing a good job into how their solution fits into the customer's overall hybrid cloud strategy. >> All right, let's take a look at the next slide, which talks to time series. So this is hyperconverged infrastructure spending intentions again, for the second half of 2019, over time. So the July '19 Survey you can see is the most recent one. We go all the way back to January '17 and you can see Nutanix on the top, VMware or vSAN on the bottom. We just selected those two. We're just repeating the net score and the shared accounts. And you can see these things tend to bounce around a little bit. You can see Nutanix maintains a lead, but the market's startin' to converge. These two companies are coming together. We hear a lot about vSAN doing very well, it's kind of held on. You can see a slight downward pressure in July, in the July survey. It's unclear what that means. That could be an indication of just some uncertainty in the marketplace. Some economic macro concerns. Tariffs, potential headwinds there, so there could be some uncertainty there. But what do you takeaway from this slide, Stu? >> Yeah, first of all right. As you show, Dave, VMware is a bit more steady, Nutanix gone up for bit and come down. Both of them stayed relatively stable. Somewhere between kind of the 45 and 55 lately. A little bit, if you look at the overall trend, Nutanix is down. VMware could surpass them from the net score in the future, if this trend holds. But both of them doing quite well. When you looked at all the other vendors in there, of course the scale is just showing 40-70%, if you put all the others, which are down much lower, you can see once again, that kind of the clear leadership. These two companies, just strong lead. Does not look like there any challengers in this space that are ready to be a clear number three yet, in the market. >> But Nutanix at one point had no competition. >> Yeah. >> Okay, now vSAN comes in and of course-- >> Oh no, absolutely. So no, SimpliVity and Scale Computing, and there were a whole host of startups. There's all the brand new startups in the space. Everything from little companies like Diamante, Pivot3, who was around doing this before it came. So there's always been a lot there, but Nutanix is the one that separated from the pack. The only one in this space that's gone IPO. But VMware's there, Microsoft won that, they rebranded their Azure Stack HCI for what they put in the data center last year. So expect Microsoft partnering with all of the big server manufacturers to push farther into HCI, but really has not directly impacted this market too much, just yet. >> But there's definitely been some pressure on Nutanix from an earning standpoint, the stock's been hit. You've had some executive departures. There's some rumors about acquisition with Google. Your thoughts on-- >> Yeah, definitely. So John Furrier just had Dheeraj Pandey, the CEO of Nutanix, in our Palo Alto studio, leading up to the Copenhagen show for Nutanix that I will be at. Sure. Sunil Potti who was basically the number two at Nutanix, is now working for Thomas Kurian, TK, over at Google Cloud. My indication from what I hear, he is not over there to help broker a deal. Sunil had a great run at Nutanix, there was a clean break there, but there is a mostly new executive team at Nutanix. Now a couple of years past the IPO and the team at Nutanix, they have their platform. The have a bunch of SaaS offerings that they're doing there. Do they have a relationship with Google? Absolutely! They had Diane Greene at one of their events a couple of years ago. They did joint engineering. But I actually saw that engineering effort cool off a little bit in the last year or so since the new regime came on in Google Cloud. So does Nutanix have a lot of Enterprise accounts and know how to work with the Enterprise and could that be a boon to Google? Absolutely! But the personnel of a Nutanix executive over at Google, and Brian Stevens who's the CTO of Google Cloud being on the Board of Nutanix? I do not think that that is telegraphing that an acquisition is going to happen. It could. We see lots of big acquisitions. Nine or 10 billion dollars from Nutanix could be interesting for Nutanix and help them get in a lot of places and help Google. But Dave, I goin' on record say, I don't think it's going to happen. I don't think Cisco is going to buy Nutanix. Infrastructure's not the real push for Chuck Robbins and that team. And at the Google Cloud event, Dave, that we were at, we saw Sanjay Poonen from VMware up on stage touting how deeply VMware was going to partner. So both VMware and Nutanix are partnering with all of the clouds. VMware of course has a very deep relationship with VMware. They're going deeper with Google, they are even partnering with the old enemy of Microsoft, so I would give VMware definitely has a deeper and more public relationship with all the public cloud providers but Nutanix is also partnering and expanding their portfolio to give themselves good growth beyond just the core HCI market. >> HP's another one. So Nutanix and HPE are workin' together. Kind of the enemy of my enemy is my friend. Nutanix was not at VMworld this year; they're kind of booted out. So they belly up to HP. >> Yeah, HP loves having, they have their, "As a service offerings," and Nutanix is one of those as well as Nutanix can sell the HP. So as the, right, the Dell relationship is likely going to die down over time, as Michael Dell on the team, want to sell more Dell hardware with VMware software. HPE is another... And they also partner with Lenovo on the Nutanix side. >> All right, Stu, bring it home. What are the key takeaways on this cube Insights. >> Okay, so HCI, who is a two-horse race right now. There are interesting companies to look at beyond the two, but if you want to understand who the leaders are in the space it is: VMware, especially with their VxRail and Nutanix, are the two leaders in that space. Really looking and understanding how they're expanding into multicloud and hybrid cloud solutions. VMware very much with their VCF offering, which packages vSAN to go into the VMware cloud offerings. And Nutanix with an interesting strategy, both with how they really spread some of their services like what they're doing with Xi Cloud, as well as some SaaS offerings, which some of them really have a disconnect. Not in a bad way, but just are not tied directly to the hardware. What the infrastructure companies have tried to do for years. Both of them, VMware's done tons of acquisitions. Nutanix has done quite a few acquisitions too. >> So your second point here, what's the impact of Dell VMware versus the Nutanix battle? You say not a significant impact on spending intentions yet. I mean there's clearly some evidence that those two markets are comin' together, that VMware's pressuring Nutanix. But why do you say, yet? What do you expect? I mean is it the OEM deal with Dell? >> It's the OAM relationship. There is huge pipeline of Dell hardware with Nutanix software and they're at loggerheads. So absolutely, the Dell family: Dell, EMC and VMware are doing all they can to dial that down. So they put pressure on the channel. And even some of the most loyal Nutanix channel partners that work with Dell, have had pressure to do more and more VxRail. So I expect it to have impact, but just as, Dave, I'll dial back the clock. You probably remember when EMC had a relationship with HP and HP killed the OEM of EMC storage. EMC stormed back and got a lot of those accounts. Same thing happened when EMC and Dell broke up a couple of years before the acquisition. So Nutanix is storming to go with HPE as one of their server partners, and (mumbles). So can Nutanix keep their growth and momentum going as Dell is no longer their biggest partner? >> Well, they're fighting a two-front war. They've got one with Dell VMware and they're also fighting the war with the public cloud guys, even though they're partnering with the public cloud guys. All right, they're sort of taking that cloud model but of course it's on prim. So you say how this public cloud affects HCI spending; not a significant impact on spending intentions yet. Can I infer from that that you do expect there to be pressure on that second front? >> Yeah, so as I've talked about before Dave, when we look at VMware and VMware gives the VMware cloud in AWS. Some say, "Great, that gives me a nice path to be able to use public cloud. But maybe I don't need some of this VMware licensing and software in there." The question for Nutanix is very similar. What services do they have? How do they become more sticky in customer environments? And absolutely, they're driving a roadmap for that in working with their customers. >> Well the thing about Nutanix is that customer's really happy. The customer's really like Nutanix. They like the simplicity. I've talked to a number of Nutanix customers that are very happy in that regard. And they have a leading product in that regard. But they're aiming at the multicloud space and can they play there? >> And Dave, you make a really good point. The killer use case, what did HCI deliver? It delivered simplicity. Today, if you talk about public cloud in general or even hybrid or multicloud, (chuckles) simplicity is not how you would describe this. So can the customers, the companies that did HCI, so, VMware, Nutanix, HPE and Cisco, they're all fighting for that hybrid and multicloud environment. And if they can help deliver simplicity of management, simplicity of leveraging my data, they can be successful in that space. >> Okay, so you're sort of positive on the multicloud, their position in multicloud. Even though they're not one of the big five. >> Yeah, and the good news for a Nutanix is that they're growing off of a much smaller base then say VMware, when you say they have five or 600,000 customers. Hey, how big of an impact will public cloud have on them? >> All right, so we don't pick stocks. We're not making recommendations. (laughs) But, do you feel like it's overdone, that it's undervalued? Independent of the macro. Do you feel like the pressure on Nutanix is warranted, or do you feel like it's got legs? >> So I feel Wall Street tends to over adjust when they go through things. When I talk to my friends on the Wall Street stuff. Definitely Nutanix took more of a beating probably then they should have. But they had two quarters that weren't great. And some of that was the management changes, they blamed that they couldn't hire sales and marketing fast enough. Something we'd asked, if you're a company in the Valley and you've gone from a few hundred people to a few thousand people. How do you keep adding good quality people? That's challenging. So yes, I think we've actually seen Dave, in the last week, or so Nutanix has been one of the fastest growing stocks in the tech market. So they're adjusting some. So I still think Nutanix has plenty of room for growth. The question is, what's their path to say, two billion dollars? Or is it an exit for 9-10 billion dollars down the road? >> All right, Stu, some great stuff. Thank you for that analysis. And thank you for watching this episode of theCube Insights, powered by ETR. This is Dave Vellante, for Stu Miniman, we'll see ya next time. (techno music)

(bright music) >> Hey welcome back, everybody. Jeff Frick here with theCUBE We are high atop San Francisco in the Sales Force Tower in the new Accenture offices, it's really beautiful and as part of that, they have their San Francisco Innovation Hubs. So it's five floors of maker's labs, and 3D printing, and all kinds of test facilities and best practices, innovation theater, and this studio which is really fun to be at. So we're talking about hybrid cloud and the development of cloud and multi-cloud and continuing on this path. Not only are customers on this path, but everyone is kind of on this path as things kind of evolve and transform. We are excited to have a couple of experts in the field we've got Larry Socher, he's the Global Managing Director of Intelligent Cloud Infrastructure Services growth and strategy at Accenture. Larry, great to see you again. >> Great to be here, Jeff. And Ajay Patel, he's the Senior Vice President and General Manager at Cloud Provider Software Business Unit at VMWare and a theCUBE alumni as well. >> Excited to be here, thank you for inviting me. >> So, first off, how do you like the digs up here? >> Beautiful place, and the fact we're part of the innovation team, thank you for that. >> So let's just dive into it. So a lot of crazy stuff happening in the marketplace. Lot of conversations about hybrid cloud, multi-cloud, different cloud, public cloud, movement of back and forth from cloud. Just want to get your perspective today. You guys have been in the middle of this for a while. Where are we in this kind of evolution? Everybody's still kind of feeling themselves out, is it, we're kind of past the first inning so now things are settling down? How do you kind of view the evolution of this market? >> Great question and I think Pat does a really nice job of defining the two definitions. What's hybrid versus multi? And simply put, we look at hybrid as when you have consistent infrastructure. It's the same infrastructure regardless of location. Multi is when you have disparate infrastructure, but are using them in a collective. So just from a from a level setting perspective, the taxonomy is starting to get standardized. Industry is starting to recognize hybrid is the reality. It's not a step in the long journey. It is an operating model that going to exist for a long time. So it's not about location. It's about how do you operate in a multi-cloud and a hybrid cloud world. And together at Accenture VMware have a unique opportunity. Also, the technology provider, Accenture, as a top leader in helping customers figure out where best to land their workload in this hybrid, multi-cloud world. Because workloads are driving decisions. >> Jeff: Right. >> We are going to be in this hybrid, multi-cloud world for many years to come. >> Do I need another layer of abstraction? 'Cause I probably have some stuff that's in hybrid and I probably have some stuff in multi, right? 'Cause those are probably not mutually exclusive, either. >> We talked a lot about this, Larry and I were chatting as well about this. And the reality is the reason you choose a specific cloud, is for those native differentiator capability. So abstraction should be just enough so you can make workloads portable. To be able to use the capability as natively as possible. And by fact that we now at VMware have a native VMware running on every major hyperscaler and on pram, gives you that flexibility you want of not having to abstract away the goodness of the cloud while having a common and consistent infrastructure while tapping into the innovations that the public cloud brings. So, it is the evolution of what we've been doing together from a private cloud perspective to extend that beyond the data center, to really make it an operating model that's independent of location. >> Right, so Larry, I'm curious your perspective when you work with customers, how do you help them frame this? I mean I always feel so sorry for corporate CIAOs. I mean they got security going on like crazy, they go GDPR now I think, right? The California regs that'll probably go national. They have so many things to be worried about. They go to keep up on the latest technology, what's happening in containers. I thought it was doc, now you tell me it's Kubernetes. It's really tough. So how do you help them kind of, put a wrapper around it? >> It's got to start with the application. I mean you look at cloud, you look at infrastructure more broadly I mean. It's there to serve the applications and it's the applications that really drive business value. So I think the starting point has to be application led. So we start off, we have our intelligent engineering guys, our platform guys, who really come in and look and do an application modernization strategy. So they'll do an assessment, you know, most of our clients given their scale and complexity usually have from 500 to 20,000 applications. You know, very large estates. And you got to start to figure out okay what's my current applications? A lot of times they'll use the six Rs methodology and they say hey okay what is it? I'm going to retire this, I no longer need it. It no longer has business value. Or I'm going to replace this with SaaS. I move it to sales force for example, or service now, etcetera . Then they're going to start to look at their workloads and say okay, hey, do I need to re-fact of reformat this. Or re-host it. And one of the things obviously, VMware has done a fantastic job is allowing you to re-host it using their software to find data center, you know, in the hyperscaler's environment. >> We call it just, you know, migrate and then modernize. >> Yeah, exactly. But the modernized can't be missed. I think that's where a lot of times we see clients kind of get in the trap, hey, i'm just going to migrate and then figure it out. You need to start to have a modernization strategy and then, 'cause that's ultimately going to dictate your multi and your hybrid cloud approach, is how those apps evolve and you know the dispositions of those apps to figure out do they get replaced. What data sets need to be adjacent to each other? >> Right, so Ajay, you know we were there when Pat was with Andy and talking about VMware on AWS. And then, you know, Sanjay is showing up at everybody else's conference. He's at Google Cloud talking about VMware on Google Cloud. I'm sure there was a Microsoft show I probably missed you guys were probably there, too. You know, it's kind of interesting, right, from the outside looking in, you guys are not a public cloud, per se, and yet you've come up with this great strategy to give customers the options to adopt VMware in a public cloud and then now we're seeing where even the public cloud providers are saying, "Here, stick this box in your data center". It's like this little piece of our cloud floating around in your data center. So talk about the evolution of the strategy, and kind of what you guys are thinking about 'cause you know you are clearly in a leadership position making a lot of interesting acquisitions. How are you guys see this evolving and how are you placing your bets? >> You know Pat has been always consistent about this and any strategy. Whether it's any cloud or any device. Any workload, if you will, or application. And as we started to think about it, one of the big things we focused on was meeting the customer where he was at in his journey. Depending on the customer, they may simply be trying to figure out working out to get on a data center. All the way, to how to drive an individual transformation effort. And a partner like Accenture, who has the breadth and depth and sometimes the vertical expertise and the insight. That's what customers are looking for. Help me figure out in my journey, first tell me where I'm at, where am I going, and how I make that happen. And what we've done in a clever way in many ways is, we've created the market. We've demonstrated that VMware is the only, consistent infrastructure that you can bet on and leverage the benefits of the private or public cloud. And I often say hybrid's a two-way street now. Which is they are bringing more and more hybrid cloud services on pram. And where is the on pram? It's now the edge. I was talking to the Accenture folks and they were saying the metro edge, right? So you're starting to see the workloads And I think you said almost 40 plus percent of future workloads are now going to be in the central cloud. >> Yeah, and actually there's an interesting stat out there. By 2022, seventy percent of data will be produced and processed outside the cloud. So I mean the edge is about to, as we are on the tipping point of IOT finally taking off beyond smart meters. We're going to see a huge amount of data proliferate out there. So the lines between between public and private have becoming so blurry. You can outpost, you look at, Antheos, Azure Stack for ages. And that's where I think VMware's strategy is coming to fruition. You know they've-- >> Sometimes it's great when you have a point of view and you stick with it against the conventional wisdom. And then all of a sudden everyone is following the herd and you are like, "This is great". >> By the way, Anjay hit on a point about the verticalization. Every one of our clients, different industries have very different paths there. And to the meaning that the customer where they're on their journey. I mean if you talk to a pharmaceutical, you know, GXP compliance, big private cloud, starting to dip their toes into public. You go to Mians and they've been very aggressive public. >> Or in manufacturing with Edge Cloud. >> Exactly. >> So it really varies by industry. >> And that's a very interesting area. Like if you look at all the OT environments of the manufacturing. We start to see a lot of end of life of environments. So what's that next generation of control systems going to run on? >> So that's interesting on the edge because and you've brought up networking a couple times while we've been talking as a potential gate, right, when one of them still in the gates, but we're seeing more and more. We were at a cool event, Churchill Club when they had psy links, micron, and arm talking about shifting more of the compute and store on these edge devices to accommodate, which you said, how much of that stuff can you do at the edge versus putting in? But what I think is interesting is, how are you going to manage that? There is a whole different level of management complexity when now you've got this different level of distributing computing. >> And security. >> And security. Times many, many thousands of these devices all over the place. >> You might have heard recent announcements from VMware around the Carbon Black acquisition. >> Yeah. >> That combined with our workspace one and the pulse IOT, we are now giving you the management framework whether it's for people, for things, or devices. And that consistent security on the client, tied with our network security with NSX all the way to the data center security. We're starting to look at what we call intrinsic security. How do we bake security into the platform and start solving these end to end? And have our partner, Accenture, help design these next generation application architectures, all distributed by design. Where do you put a fence? You could put a fence around your data center but your app is using service now and other SaaS services. So how do you set up an application boundary? And the security model around that? So it's really interesting times. >> You hear a lot about our partnership around software defined data center, around networking. With Villo and NSX. But we've actually been spending a lot of time with the IOT team and really looking and a lot of our vision aligns. Actually looking at they've been working with similar age in technology with Liota where, ultimately the edge computing for IOT is going to have to be containerized. Because you're going to need multiple modalware stacks, supporting different vertical applications. We were actually working with one mind where we started off doing video analytics for predictive maintenance on tires for tractors which are really expensive the shovels, et cetera. We started off pushing the data stream, the video stream, up into Azure but the network became a bottleneck. We couldn't get the modality. So we got a process there. They're now looking into autonomous vehicles which need eight megabits load latency band width sitting at the edge. Those two applications will need to co-exist and while we may have Azure Edge running in a container down doing the video analytics, if Caterpillar chooses Green Grass or Jasper, that's going to have to co-exist. So you're going to see the whole containerization that we are starting to see in the data center, is going to push out there. And the other side, Pulse, the management of the Edge, is going to be very difficult. >> I think the whole new frontier. >> Yeah absolutely. >> That's moving forward and with 5G IntelliCorp. They're trying to provide value added services. So what does that mean from an infrastructure perspective? >> Right, right. >> When do you stay on the 5G radio network versus jumping on a back line? When do you move data versus process on the edge? Those are all business decisions that need to be there into some framework. >> So you guys are going, we can go and go and go. But I want to follow up on your segway on containers. 'Cause containers is such an important part of this story and an enabler to this story. And you guys made and aggressive move with Hep TO. We've had Craig McLuckie on when he was still at Google and Dan, great guys. But it's kind of funny right? 'Cause three years ago, everyone was going to DockerCon right? That was like, we're all about shows. That was the hot show. Now Docker's kind of faded and Kubernetes is really taking off. Why, for people that aren't familiar with Kubernetes, they probably hear it at cocktail parties if they live in the Bay area. Why is containers such an important enabler and what's so special about Kubernetes specifically? >> Do you want to go on the general or? >> Why don't your start off? >> I brought my products stuff for sure. >> If you look at the world its getting much more dynamic. Particularly as you start to get more digitally decoupled applications, you're starting, we've come from a world where a virtual machine might have been up for months or years to all the sudden you have containers that are much more dynamic, allowed to scale quickly, and then they need to be orchestrated. And that's essentially what Kubernetes does, is really start to orchestrate that. And as we get more distributed workloads, you need to coordinate them. You need to be able to scale up as you need for performance etcetera So Kubernetes is an incredible technology that allows you really to optimize the placement of that. So just like the virtual machine changed how we compute, containers now gives us a much more flexible, portable, you can run on any infrastructure at any location. Closer to the data etcetera to do that. >> I think the bold move we made is, we finally, after working with customers and partners like Accenture, we have a very comprehensive strategy. We announced Project Tanzu at our last VM World. And Project Tanzu really focused on three aspects of containers, How do you build applications, which is what Pivotal and the acquisition of Pivotal was driven around. How do we run these on a robust enterprise class run time? And what if you could take every vSphere ESX out there and make it a container platform. Now we have half a million customers. 70 million VM's. All the sudden, that run time we are container enabling with a Project Pacific. So vSphere 7 becomes a common place for running containers and VMs. So that debate of VMs or containers? Done, gone. One place or just spend up containers and resources. And then the more important part is how do I manage this? As you have said. Becoming more of a platform, not just an orchestration technology. But a platform for how do I manage applications. Where I deploy them where it makes more sense. I've decoupled my application needs from the resources and Kubernetes is becoming that platform that allows me to portably. I'm the Java Weblogic guy, right? So this is like distributed Weblogic Java on steroids, running across clouds. So pretty exciting for a middleware guy, this is the next generation middleware. >> And to what you just said, that's the enabling infrastructure that will allow it to roll into future things like edge devices. >> Absolutely. >> You can manage an Edge client. You can literally-- >> the edge, yeah. 'Cause now you've got that connection. >> It's in the fabric that you are going to be able to connect. And networking becomes a key part. >> And one of the key things, and this is going to be the hard part is optimization. So how do we optimize across particularly performance but even cost? >> And security, rewiring security and availability. >> So still I think my all time favorite business book is Clayton Christensen, "Innovator's Dilemma". One of the most important lessons in that book is what are you optimizing for? And by rule, you can't optimize for everything equally. You have to rank order. But what I find really interesting in this conversation and where we're going and the complexity of the size of the data, the complexity of what am I optimizing for now just begs for plight AI. This is not a people problem to solve. This is AI moving fast. >> Smart infrastructure going to adapt. >> Right, so as you look at that opportunity to now apply AI over the top of this thing, opens up tremendous opportunity. >> Absolutely, I mean standardized infrastructure allows you, sorry, allows you to get more metrics. It allows you to build models to optimize infrastructure over time. >> And humans just can't get their head around it. I mean because you do have to optimize across multiple dimensions as performance, as cost. But then that performance is compute, it's the network. In fact the network's always going to be the bottleneck. So you look at it, even with 5G which is an order magnitude more band width, the network will still lag. You go back to Moore's Law, right? It's a, even though it's extended to 24 months, price performance doubles, so the amount of data potentially can exponentially grow our networks don't keep pace. So that optimization is constantly going to have to be tuned as we get even with increases in network we're going to have to keep balancing that. >> Right, but it's also the business optimization beyond the infrastructure optimization. For instance, if you are running a big power generation field of a bunch of turbines, right, you may want to optimize for maintenance 'cause things are running in some steady state but maybe there's an oil crisis or this or that, suddenly the price rises and you are like, forget the maintenance right now, we've got a revenue opportunity that we want to tweak. >> You just talked about which is in a dynamic industry. How do I real time change the behavior? And more and more policy driven, where the infrastructure is smart enough to react, based on the policy change you made. That's the world we want to get to and we are far away from that right now. >> I mean ultimately I think the Kubernetes controller gets an AI overlay and then operators of the future are tuning the AI engines that optimize it. >> Right, right. And then we run into the whole thing which we talked about many times in this building with Dr. Rumman Chowdhury from Accenture. Then you got the whole ethics overlay on top of the business and the optimization and everything else. That's a whole different conversation for another day. So, before we wrap I just want to give you kind of last thoughts. As you know customers are in all different stages of their journey. Hopefully, most of them are at least off the first square I would imagine on the monopoly board. What does, you know, kind of just top level things that you would tell people that they really need just to keep always at the top as they're starting to make these considerations? Starting to make these investments? Starting to move workloads around that they should always have at the top of their mind? >> For me it's very simple. It's really about focus on the business outcome. Leverage the best resource for the right need. And design architectures that are flexible that give you choice, you're not locked in. And look for strategic partners, whether it's technology partners or services partners that allow you to guide. Because if complexity is too high, the number of choices are too high, you need someone who has the breadth and depth to give you that platform which you can operate on. So we want to be the ubiquitous platform from a software perspective. Accenture wants to be that single partner who can help them guide on the journey. So, I think that would be my ask is start thinking about who are your strategic partners? What is your architecture and the choices you're making that give you the flexibility to evolve. Because this is a dynamic market. Once you make decisions today, may not be the ones you need in six months even. >> And that dynanicism is accelerating. If you look at it, I mean, we've all seen change in the industry, of decades in the industry. But the rate of change now, the pace, things are moving so quickly. >> And we need to respond to competitive or business oriented industry. Or any regulations. You have to be prepared for that. >> Well gentleman, thanks for taking a few minutes and great conversation. Clearly you're in a very good space 'cause it's not getting any less complicated any time soon. >> Well, thank you again. And thank you. >> All right, thanks. >> Thanks. >> Larry and Ajay, I'm Jeff, you're watching theCUBE. We are top of San Francisco in the Sales Force Tower at the Accenture Innovation Hub. Thanks for watching. We'll see you next time.