(upbeat music) >> Hey everyone. Welcome to theCUBE's coverage of Women In Tech, International Women's Day 2022. I'm your host, Lisa Martin. I have two guests from AWS here with me. Carolina Pina joins us, the head of Enterprise Enablement for LATAM and Laura Alvarez Modernel is here as well, Public Sector Programs Manager at AWS. Ladies, it's great to have you on theCUBE. >> Nice to meet you. >> Thank you for having us. >> Carolina, let's start with you. Talk to me a little bit about your role, what it is that you're doing there. >> So my role in AWS is to actually create mechanisms of massive training to try to close the talent gap that we have in the region. And when I mentioned talent gap, I'm talking about obviously digital and cloud-computing skills. So that's, that's, in a nutshell what my role entails. >> Lisa: Got it. How long have you been in that role? Just curious. >> So I've been at AWS a little bit over, over two years. I was actually in the public sector team when I joined, leading the education vertical for Latin American Canada. And I recently joined the commercial sector now leading these massive training efforts for the region for LATAM. >> And Laura, you're in public sector. Talk to me a little bit about your role. >> Yes, I'm in public sector. I'm also based in Buenos Aires, Argentina. So yeah, I'm from Latin America, and I lead educational and community impact programs in the Southern cone of Latin America. I also lead diversity, equity and inclusion efforts and I'm part of the Women at Amazon global board. That's our affinity group to make sure we make efforts towards building a more equal world. And on a personal note I'm really passionate about the topic of gender equality because I truly think it affects us all as women and as Latins. So that's something that I'm always interested in collaborating with. >> Lisa: Excellent. Carolina back to you. If we think about from an enablement perspective how is AWS partnering with its customers and its partners to train and employ women particularly in technology? >> Oh, sure. Lisa, so it's not a surprise. We, like I mentioned, you know we have a big cloud skills, talent gap in the region. In fact, you know, 69% of companies have reported talent shortages and difficulty hiring. So, and this represents a 15 year high. So, many of these companies are actually, you know, our own commercial customers. So they approach us saying, you know, asking for for support training and developing their talent. So like I mentioned, in my role I create massive training efforts and initiatives. So we always take into consideration women, minorities, underrepresented community, and not just for the current talent, meaning like the people that are currently employed, but also to ensure that we are proactively implementing initiatives to develop a talent of younger you know, a younger generation and a talent. So we can, you know, to inspire them and, and ensure that they, that we're seeing them represented in companies like AWS, you know and our customers, and in our partners. And obviously we, when we sit down with customers to craft these massive trainings you know, leveraging their ecosystems and communities, we actually try to use all our AWS training and certification portfolio which includes, you know, in live in class with live in structures, in classroom trainings. We also have our AWS Skill Builder platform which is the platform that allows us to, you know to reach a broader audience because it has, you know over 500 free and on-demand classes. And we also have a lot of different other programs that touches in different audiences. You know, we have AWS re/Start for underrepresented, and underemployed minorities. We also have AWS Academy, which is the program that we have for higher education institutions. And we have AWS, you know, Educate which also touches, you know, cloud beginners. So in every single of these programs, we ensure that we are encompassing and really speaking to women and developing training and developing women. >> Lisa: That's a great focus there. Laura, talk to me about upskilling. I know AWS is very much about promoting from within. What are some of the things that it's doing to help women in Latin America develop those tech skills and upskill from where, maybe where they are now? >> Well, Lisa, I think that is super interesting because there's definitely a skills gap problem, right? We have all heard about. And what's funny is also that we have this huge opportunity in Latin America to train people and to help further develop the countries. And we have the companies that need the talent. So why is there still a gap, right? And I think that's because there's no magic solution to solving this problem. No, like epic Hollywood movie scene that it's going to show how we close the gap. And it takes stepping out of our comfort zone. And as Carolina mentioned, collaborating. So, we at AWS have a commitment to help 29 million people globally to grow their technical skills with free cloud-computing skills training by 2025. I know that sounds a lot through educational programs but we do have as Carolina mentioned, a Skill Builder you can go into the website for free, enter, choose your path, get trained. We have Academy that we implement with universities. Re/Start that is a program that's already available in Argentina, Brazil, Chile, Colombia, Mexico, Peru, and Costa Rica. So there are a lot of opportunities, but you also mentioned something else that I would like to dive a bit deeper that is Latin American women. And yesterday we had the opportunity to record a panel about intersectionality with three amazing Latin women. And what we have to learn from that is that these are two minorities that intersect, right. We're talking about females that are minority. Latinas are minority. And in tech, that is also something that is even bigger minority. So there are more difficulties there and we need to make sure that we are meeting that talent that is there that is in Latin America, that exists. We know for sure we have unicorns in Latin America that are even AWS customers like Mercado Libre, and we have to meet them with the opportunities. And that's why we created a program that came from identifying how this problem evolves in Latin America, that there is a lack of confidence in women also that they don't feel prepared or equipped. There is a cultural component why we don't choose tech careers. And we partner with universities, more than 12 universities in Latin America with the International American Development Bank as well to create tech skills that's a free five weeks program in order to get students and get female in Latin America, into the tech world. And we also have them with mentorship. So I think that is an opportunity to truly collaborate because we as AWS are not going to solve these by ourselves, right? We need everyone pitching in on that. >> Lisa: Right. It's absolutely a team effort. You mentioned something important in terms of helping women, and especially minorities get out of their comfort zone. Carolina, I'm curious when you're talking with women and getting them into the program and sharing with them all of the enablement programs that you have, how do you help them be confident to get out of that comfort zone? That's a hard thing to do. >> Yeah, no, for sure. For sure, Lisa, well, I, you know, a lot of times actually I use myself as an example because, you know, I studied engineering and industrial systems engineering many years ago. And you know, a lot of my career has been in in higher education and innovation and startups. And as I mentioned in the intro I've been at AWS for a little bit over two years. So I, my career has not been in cloud and I recently joined the cloud. So I actually had to go through our own trainings and get our own certifications. So I, that's, you know a lot of times I actually, I use my own example, so people understand that you don't have to come from tech, you don't have to come, you can actually be a non-tech person and, and also see the the benefits of the cloud. And you don't have to only, you know, learn cloud if you're in the IT department or in an IT team. So sometimes, I also emphasize that the cloud and the future is absolutely the cloud. In fact, the world economic foreign, you know teaches us that cloud-computing is that the technology that's going to be mostly adopted by 2025. So that's why we need to ensure that every single person, women and others are really knowledgeable in the cloud. So that's why, you know, technical and untechnical. But I, you know, I use myself as an example for them to say, you know, you can actually do it. And obviously also I collaborate with Laura and a lot of the women at Amazon Latin America Group to also you know, ensure that we're doing webinars and panels. So we show them ourselves as role model like, Laura is an incredible role model for our community. And so it's also to to show examples of what the possibilities are. And that's what we do. >> Lisa: I love that you're sharing >> And can I make a note there also? >> Please, yes. >> To add to that. I think it also requires the companies and the, and the private sector to get out of their comfort zone, right? Because we are not going to find solutions doing what we are already doing. We truly need to go and get near these persons with a new message. Their interest is there in these programs we have reached more than 3,000 women already in Latin America with tech skills. So it's not that women are not interested. It's like, how do we reach them with a message that resounds with them, right? Like how we can explain the power of technology to transform the world and to actually improve their communities. I think there's something there also that we need to think further of. >> It's so important. You know, we say often when we're talking about women in tech, that she needs to see what she can be or if she can't see it, she can't be it. So having those role models and those mentors and sponsors is absolutely critical for women to get, I call it getting comfortably uncomfortable out of that comfort zone and recognizing there's so many opportunities. Carolina, to your point, you know, these days every company is a tech company, a data company whether you're talking about a car dealer, a grocery market. So your point about, you know, and obviously the future being cloud there's so much opportunity that that opens up, for everybody really, but that's an important thing for people to recognize how they can be a part of that get out of their comfort zone and try something that they maybe hadn't considered before. >> Yes. And, actually, Lisa I would love to share an example. So we have a group, O Boticário, which is one of our customers one of the, the lead retails in Brazil. And they've been a customer of AWS since 2013 when they realized that, you know the urgency and the importance of embracing state of the art technology, to your point, like, you know this is a retail company that understands that needs to be, you know embrace digital transformation, especially because, you know they get very busy during mother's days and other holidays during the year. So they realized that they, instead of outsourcing their IT requirements to technology experts they decided to actually start developing and bringing the talent, you know within itself, within, you know, technology in-house. So they decided to start training within. And that's when we, obviously we partnered with them to also create a very comprehensive training and certification plan that started with, you know a lot of the infrastructure and security teams but then it was actually then implemented in the rest of the company. So going back to the point like everybody really needs to know. And what we also love about O Boticário is they they really care about the diversion and inclusion aspect of this equation. And we actually collaborated with them as well through this program called Desenvolve with the Brazilian government. And Desenvolve means developing Portuguese and they this program really ensures that we are also closing that gender and that race gap and ensuring that they're actually, you know, developing talent in cloud for Brazil. So we, you know, obviously have been very successful with them and we will continue to do even more things with them particular for this topic. >> Lisa: I've always known how customer focused AWS is every time we get to go to re:Invent or some of the events but it's so nice to hear these the educational programs that you're doing with customers to help them improve DEI to help them enable their own women in their organizations to learn skills. I didn't realize that. I think that's fantastic very much a symbiotic part of AWS. If we think about the theme for this year's International Women's Day, Breaking The Bias I want to get both of your opinions and Laura we'll start with you, what that means to you, and where do you think we are in Latin America with breaking the bias? >> Well, I think breaking the bias is the first step to truly being who we are every day and being able to bring that to our work as well. I think we are in a learning curve of that. The companies are changing culturally, as Carolina mentioned we have customers that are aware of the importance of having women. And as we say at AWS not only because there is a good business reason because there is, because there are studies that show that we can increase the country's CPD, but also because it's important and it's the right thing to do. So in terms of breaking the bias I think we are learning and we have a long way to go. I talked a bit earlier about intersectionality and that is something that is also important to highlight, right? Because we are talking about females but we are also talking about another minorities. We're talking about underrepresented communities, Indigenous People, Latins. So when these overlap, we face even bigger challenges to get where we want to get, right? And to get to decision making places because technology is transforming the ways we take decisions, we live, and we need someone like us taking those decisions. So I think it's important at first to be aware and to see that you can get there and eventually to start the conversation going and to build the conversation, not to just leave it but to make sure we hear people and their input and what they're going through. >> Lisa: Yes. We definitely need to hear them. Carolina, what's your take on breaking the bias and where do you from your experience, where do you think we are with it? >> Yeah, no, I'm as passionate as Laura on this topic. And that's why we, you know we're collaborating in the Women at Amazon Latin America Chapter, because we're both very, I think breaking the bias starts with us and ourselves. And we are very proactive within AWS and externally. And I feel it's also, I mean, Lisa, what we've been doing is not only, obviously gathering you know, the troops and really making sure that, that we have very aggressive goals internally, but also bringing you know, bringing our male counterparts, and other, you know, other members of the other communities, because the change, we're not going to make it alone. Like the change where it is not women only talking to women is going to make the change. We actually need to make sure the male and other groups are represented. And the dialogue that they're that we're very conscious about that. And I feel like we're seeing more and more that the topic is becoming more of a priority not only within AWS and Amazon but we also see it because now that I meet with when I meet with customers around the region they really want to see how we can collaborate in these diversion and inclusion initiatives. So I think we are breaking the bias because now this topic is more top of mind. And then we are being more proactively addressing it and and training people and educating people. And I feel we're really in a pivoted point where the change that we've really been wanting to we will see in the next you know, few years which is very exciting. >> Lisa: Excellent, and we'll see that with the help of women like you guys. Thank you so much for joining me today, talking about what you're doing, how you're helping organizations across AWS's ecosystem, customers, partners, and helping, of course, folks from within you, right. It's a holistic effort, but we are on our way to breaking that bias and again, I thank you both for your insights. >> Thank you. >> Thank you, Lisa, for the opportunity. >> My pleasure. For Carolina Pina and Laura Alvarez Modernel, I'm Lisa Martin. You're watching theCUBE's coverage of Women in Tech, International Women's Day 2022. (upbeat music)

from the cube studios in palo alto in boston bringing you data-driven insights from the cube and etr this is breaking analysis with dave vellante the pandemic not only accelerated the shift to digital but also highlighted a rush of cyber criminal sophistication collaboration and chaotic responses by virtually every major company in the planet the solar winds hack exposed supply chain weaknesses and so-called island hopping techniques that are exceedingly difficult to detect moreover the will and aggressiveness of well-organized cyber criminals has elevated to the point where incident responses are now met with counterattacks designed to both punish and extract money from victims via ransomware and other criminal activities the only upshot is the cyber security market remains one of the most enduring and attractive investment sectors for those that can figure out where the market is headed and which firms are best positioned to capitalize hello everyone and welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll provide our quarterly update of the security industry and share new survey data from etr and thecube community that will help you navigate through the maze of corporate cyber warfare we'll also share our thoughts on the game of 3d chest that octa ceo todd mckinnon is playing against the market now we all know this market is complicated fragmented and fast moving and this next chart says it all it's an interactive graphic from optiv a denver colorado based si that's focused on cyber security they've done some really excellent research and put together this awesome taxonomy and mapped vendor names therein and this helps users navigate the complex security landscape and there are over a dozen major sectors high-level sectors within the security taxonomy in nearly 60 sub-sectors from monitoring vulnerability assessment identity asset management firewalls automation cloud data center sim threat detection and intelligent endpoint network and so on and so on and so on but this is a terrific resource and can help you understand where players fit and help you connect the dots in the space now let's talk about what's going on in the market the dynamics in this crazy mess of a landscape are really confusing sometimes now since the beginning of cyber time we've talked about the increasing sophistication of the adversary and the back and forth escalation between good and evil and unfortunately this trend is unlikely to stop here's some data from carbon black's annual modern bank heist report this is the fourth and of course now vmware's brand highlights the carbon black study since the acquisition and it catalyzed the creation of vmware's cloud security division destructive malware attacks according to the recent study are up 118 percent from last year now one major takeaway from the report is that hackers aren't just conducting wire fraud they are 57 of the bank surveyed saw an increase in wire fraud but the cyber criminals are also targeting non-public information such as future trading strategies this allows the bad guys to front run large block trades and profit it's become very lucrative practice now the prevalence of so-called island hopping is up 38 from already elevated levels this is where a virus enters a company's supply chain via a partner and then often connects with other stealthy malware downstream these techniques are more common where the malware will actually self-form with other infected parts of the supply chain and create actions with different signatures designed to identify and exfiltrate valuable information it's a really complex problem of major concern is that 63 of banking respondents in the study reported that responses to incidents were then met with retaliation designed to intimidate or initiate ransomware attacks to extract a final pound of flesh from the victim notably the study found that 75 percent of csos reported to the cio which many feel is not the right regime the study called for a rethinking of the right cyber regime where the cso has increased responsibility in a direct reporting line to the ceo or perhaps the co with greater exposure to boards of directors so many thanks to vmware and tom kellerman specifically for sharing this information with us this past week great work by your team now some of the themes that we've been talking about for several quarters are shown in the lower half of the chart cloud of course is the big driver thanks to work from home and the pandemic to pandemic and the interesting corollary of course is we see a rapid rethinking of endpoint and identity access management and the concept of zero trust in a recent esg survey two-thirds of respondents said that their use of cloud computing necessitated a change in how they approach identity access management now as shown in the chart from optiv the market remains highly fragmented and m a is of course way up now based on our research it looks like transaction volume has increased more than 40 percent just in the last five months so let's dig into the m a the merger and acquisition trends for just a moment we took a five month snapshot and we were able to count about 80 deals that were completed in that time frame those transactions represented more than 20 billion dollars in value some of the larger ones are highlighted here the biggest of course being the toma bravo taking proof point private for a 12 plus billion dollar price tag the stock went from the low 130s and is trading in the low 170s based on 176 dollar per share offer so there's your arbitrage folks go for it perhaps the more interesting acquisition was auth 0 by octa for 6.5 billion which we're going to talk about more in a moment there's more private equity action we saw as insight bought armis and iot security play and cisco shelled out 730 million dollars for imi mobile which is more of an adjacency to cyber but it's going to go under cisco's security and applications business run by g2 patel but these are just the tip of the iceberg some of the themes that we see connecting the dots of these acquisitions are first sis like accenture atos and wipro are making moves in cyber to go local they're buying secops expertise as i say locally in places like france germany netherlands canada and australia that last mile that belly-to-belly intimate service israel israeli-based startups chalked up five acquired companies in the space over the last five months also financial services firms are getting into the act with goldman and mastercard making moves to own its own part of the stack themselves to combat things like fraud and identity theft and then finally numerous moves to expand markets octa with zero crowdstrike buying a log management company palo alto picking up devops expertise rapid seven shoring up its kubernetes chops tenable expanding beyond insights and going after identity interesting fortinet filling gaps in a multi-cloud offering sale point extending to governance risk and compliance grc zscaler picked up an israeli firm to fill gaps in access control and then vmware buying mesh 7 to secure modern app development and distribution services so tons and tons of activity here okay so let's look at some of the etr data to put the cyber market in context etr uses the concept of market share it's one of the key metrics which is a measure of pervasiveness in the data set so for each sector it calculates the number of respondents for that sector divided by the total to get a sense for how prominent the sector is within the cio and i.t buyer communities okay this chart shows the full etr sector taxonomy with security highlighted across three survey periods april last year january this year in april this year now you wouldn't expect big moves in market share over time so it's relatively stable by sector but the big takeaway comes from observing which sectors are most prominent so you see that red line that dotted line imposed at the sixty percent level you can see there are only six sectors above that line and cyber security is one of them okay so we know that security is important in a large market but this puts it in the context of the other sectors however we know from previous breaking analysis episodes that despite the importance of cyber and the urgency catalyzed by the pandemic budgets unfortunately are not unlimited and spending is bounded it's not an open checkbook for csos as shown in this chart this is a two-dimensional graphic showing market share in the horizontal axis or pervasiveness and net score in the vertical axis net score is etr's measurement of spending velocity and we've superimposed a red line at 40 percent because anything over 40 percent we consider extremely elevated we've filtered and limited the number of sectors to simplify the graphic and you can see in the sectors that we've highlighted only the big four four are above that forty percent line ai containers rpa and cloud they exceed that sort of forty percent magic water line information security you can see that is highlighted and it's respectable but it competes for budget with other important sectors so this of course creates challenges for organization because not only are they strapped for talent as we've reported they like everyone else in it face ongoing budget pressures research firm cybersecurity ventures estimates that in 2021 6 trillion dollars worldwide will be lost on cyber crime conversely research firm canalis pegs security spending somewhere around 60 billion dollars annually idc has it higher around 100 billion so either way we're talking about spending between one to one point six percent annually of how much the bad guys are taking out that's peanuts really when you consider the consequences so let's double click into the cyber landscape a bit and further look at some of the companies here's that same x y graphic with the company's etr captures from respondents in the cyber security sector that's what's shown on the chart here now the usefulness of the red lines is 20 percent on the horizontal indicates the largest presence in the survey and the magic 40 percent line that we talked about earlier shows those firms with the most elevated momentum only microsoft and palo alto exceed both high water marks of course splunk and cisco are prominent horizontally and there are numerous companies to the left of the 20 percent line and many above that 40 percent high water mark on the vertical axis now in the bottom left quadrant that includes many of the legacy names that have been around for a long time and there are dozens of companies that show spending momentum on their platforms i.e above single digits so that picture is like the first one we showed you very very crowded space but so let's filter it a bit and only include companies in the etr survey that had at least a hundred responses so an n of a hundred or greater so it's a little easy to read but still it's kind of crowded when you think about it okay so same graphic and we've superimposed the data that determined the plot position over in the bottom right there so it's net score and shared n including only companies with more than 100 n so what does this data tell us about the market well microsoft is dominant as always it seems in all dimensions but let's focus on that red line for a moment some of the names that we've highlighted over the past two years show very well here first i want to talk about palo alto networks pre-covet as you might recall we highlighted the valuation divergence between palo alto and fortinet and we said fortinet was executing better on its cloud strategy and palo alto was at the time struggling with the transition especially with its go to market and its sales force compensation and really refreshing its portfolio but we told you that we were bullish on palo alto networks at the time because of its track record and the fact that cios consistently told us that they saw palo alto as a thought leader in the space that they wanted to work with they said that palo alto was the gold standard the best especially larger company cisos so that gave us confidence that palo alto a very well-run company was going to get its act together and perform better and palo alto has just done just that as we expected they've done very well and they've been rapidly moving customers to the next generation of platforms and we're very impressed by the company's execution and the stock has generally reflected that now some other names that hit our radar and the etr data a couple of years ago continue to perform well crowdstrike z-scaler sales sail point and cloudflare a cloudflare just reported and beat earnings but was off the stock fell on headwinds for tech overall the big rotation but the company is doing very well and they're growing rapidly and they have momentum as you can see from the etr data and we put that double star around proof point to highlight that it was worthy of fetching 12 and a half billion dollars from private equity firm so nice exit there supporting the continued control consolidation trend that we've predicted in cyber security now let's turn our attention to octa and auth zero this is where it gets interesting and is a clever play for octa we think and we want to drill into it a bit octa is acquiring auth zero for big money why well we think todd mckinnon octa ceo wants to run the table on identity and then continue to expand his tam he has to do that to justify his lofty valuation so octa's ascendancy around identity and single sign sign-on is notable the fragmented pictures that we've shown you they scream out for simplification and trust and that's what octa brings but it competes with some major players most notably microsoft with active directory so look of course microsoft is going to dominate in its massive customer base but the rest of the market that's like jump ball it's wide open and we think mckinnon saw the opportunity to go dominate that sector now octa comes at this from an enterprise perspective bringing top-down trust to the equation and throwing a big blanket over all the discrete sas platforms and unifying employee access octa's timing was perfect it was founded in 2009 just as the massive sasification trend was happening around crm and hr and service management and cloud etc but the one thing that octa didn't have that auth 0 does is serious developer chops while octa was crushing it with its enterprise sales strategy auth 0 was laser focused on developers and building a bottoms up approach to identity by acquiring auth0 octa can dominate both sides of the barbell and then capture the fat middle so yes it's a pricey acquisition but in our view it's a great move by mckinnon now i don't know mckinnon personally but last week i spoke to arun shrestha who's the ceo of security specialist beyond id they're a platinum services partner of octa and there a zero trust expert he worked for octa for a number of years and shared with me a bit about mckinnon's style and think big approach arun said something that caught my attention he said firewalls used to be the perimeter now people are and while that's self-serving to octa and probably beyond id it's true people apps and data are the new perimeter and they're not in one location and that's the point now unfortunately i had lined up an interview with dia jolly who was the chief product officer at octa in a cube alum for this past week knowing that we were running this segment in this episode but she unfortunately fell ill the day of our interview and had to cancel but i want to follow up with her and understand how she's thinking about connecting the dots with auth 0 with devs and enterprises and really test our thesis there this is a really interesting chess match that's going on let's look a little deeper into that identity space this chart here shows some of the major identity players it has some of the leaders in the identity market and there's a breakdown of etr's net score now net score comprises five elements the lime green is we're adding the platform new the forest green is we're spending six percent or more relative to last year the gray is flat send plus or minus flat spend plus or minus five percent the pinkish is spending less and the bright red is where exiting the platform retiring now you subtract the red from the green and that gets you the result for net score which you can see superimposed on the right hand chart at the bottom that first column there the far column is shared in which informs and indicates the number of responses and is a proxy for presence in the market oh look at the top two players in terms of spending momentum now sales sale point is right there but auth 0 combined with octa's distribution channel will extend octa's lead significantly in our view and then there's microsoft now just a caveat this includes all of microsoft's security offerings not just identity but it's there for context and cyber arc as well includes its acquisition of adaptive but also other parts of cyberarks portfolio so you can see some of the other names that are there many of which you'll find in the gartner magic quadrant for identity and as we said we really like this move by octa it combines positive market forces with lead offerings from very well-run companies that have winning dna and passionate people now to further emphasize emphasize what what's happening here take a look at this this chart shows etr data for octa within sale point and cyber arc accounts out of the 230 cyber and sale point customers in the data set there are 81 octa accounts that's a 35 overlap and the good news for octa is that within that base of sale point in cyber arc accounts octa is shown by the net score line that green line has a very elevated spending and momentum and the kicker is if you read the fine print in the right hand column etr correctly points out that while sailpoint and cyberarc have long been partners with octa at the recent octane 21 event octa's big customer event the company announced that it was expanding into privileged access management pam and identity governance hello and welcome to coopetition in the 2020s now our current thinking is that this bodes very well for octa and cyberark and sailpoint well they're going to have to make some counter moves to fend off the onslaught that is coming now let's wrap up with what has become a tradition in our quarterly security updates looking at those two dimensions of net score and market share we're going to see which companies crack the top 10 for both measures within the etr data set we do this every quarter so here on the left we have the top 20 sorted by net score or spending momentum and on the right we sort by shared n so again top 20 which informs shared end and forms the market share metric or presence in the data set that red horizontal lines those two lines on each separate the top 10 from the remaining 10 within those top 20. in our method what we do is we assign four stars to those companies that crack the top ten for both metrics so again you see microsoft palo alto networks octa crowdstrike and fortinet fortinet by the way didn't make it last quarter they've kind of been in and out and on the bubble but you know this company is very strong and doing quite well only the other four did last quarter there was same four last quarter and we give two stars to those companies that make it in both categories within the top 20 but didn't make the top 10. so cisco splunk which has been steadily decelerating from a spending momentum standpoint and z-scaler which is just on the cusp you know we really like z-scaler and the company has great momentum but that's the methodology it is what it is now you can see we kept carbon black on the rightmost chart it's like kind of cut off it's number 21 only because they're just outside looking in on netscore you see them there they're just below on on netscore number 11. and vmware's presence in the market we think that carbon black is really worth paying attention to okay so we're going to close with some summary and final thoughts last quarter we did a deeper dive on the solar winds hack and we think the ramifications are significant it has set the stage for a new era of escalation and adversary sophistication now major change we see is a heightened awareness that when you find intruders you'd better think very carefully about your next moves when someone breaks into your house if the dog barks or if you come down with a baseball bat or other weapon you might think the intruder is going to flee but if the criminal badly wants what you have in your house and it's valuable enough you might find yourself in a bloody knife fight or worse what's happening is intruders come to your company via island hopping or inside or subterfuge or whatever method and they'll live off the land stealthily using your own tools against you so they can you can't find them so easily so instead of injecting new tools in that send off an alert they just use what you already have there that's what's called living off the land they'll steal sensitive data for example positive covid test results when that was really really sensitive obviously still is or other medical data and when you retaliate they will double extort you they'll encrypt your data and hold it for ransom and at the same time threaten to release the sensitive information to crushing your brand in the process so your response must be as stealthy as their intrusion as you marshal your resources and devise an attack plan you face serious headwinds not only is this a complicated situation there's your ongoing and acute talent shortage that you tell us about all the time many companies are mired in technical debt that's an additional challenge and then you've got to balance the running of the business while actually affecting a digital transformation that's very very difficult and it's risky because the more digital you become the more exposed you are so this idea of zero trust people used to call it a buzzword it's now a mandate along with automation because you just can't throw labor at the problem this is all good news for investors as cyber remains a market that's ripe for valuation increases and m a activity especially if you know where to look hopefully we've helped you squint through the maze a little bit okay that's it for now thanks to the community for your comments and insights remember i publish each week on wikibon.com and siliconangle.com these episodes they're all available as podcasts all you do is search breaking analysis podcast put in the headphones listen when you're in your car out for your walk or run and you can always connect on twitter at divalante or email me at david.valante at siliconangle.com i appreciate the comments on linkedin and in clubhouse please follow me so you're notified when we start a room and riff on these topics and others and don't forget to check out etr.plus for all the survey data this is dave vellante for the cube insights powered by etr be well and we'll see you next time [Music] you

>> Announcer: From around the globe, it's theCUBE! With digital coverage of IBM Think 2021. Brought to you by IBM. >> Well welcome everyone as theCUBE continues our IBM Think series. It's a pleasure to have you with us here on theCUBE. I'm John Walls, and we're joined today by Brian Loveys who is the Director of Offering Management for Customer and Employee Care Applications at IBM in the Data and AI Division. So, Brian, thanks for joining us from Ottawa, Canada. Good to see you today. >> Yeah, great to be here, John. And looking forward to the session today. >> Which, by the way, I've learned Ottawa are the home of the world's largest ice skating rink. I doubt we get into that today, but it is interesting food for thought. So, Brian, first off, let's just talk about the AI landscape right now. I know IBM obviously very heavily invested in that. Just in terms of how you see this currently in terms of enterprise adoption, what people are doing with it, and just how you would talk about the state of the industry right now. >> You know, it's a really interesting one, right? I think if you look at it, you know, different companies, different industries, frankly, are at different stages of their AI journey, right? I think for me personally, what was really interesting was, and we're all going through the pandemic right now, but last year with COVID-19 in the March timeframe, it was really interesting to see the impact, frankly, in the space that I play predominantly in around customer care, right? When the pandemic hit, immediately call centers, contact centers got flooded with calls, right? And so it created a lot of problems for organizations. But what was interesting to me is it accelerated a lot of adoption of AI to organizations that typically lag in technology, right? So if you think about public sector, right, that was one area that got hit very, very hard with questions and those types of things, and trying to, you know, communicate out information. So it was really interesting to see those organizations, frankly, accelerate really, really quickly, right? And if you actually, you know, talk to those organizations now, I think one of the most interesting things to me in thinking about it and talking to them now is like, hey, you know, we can do this, right? AI is really not that complicated. It can be simplified, we can take advantage of it and all of those types of things, right? So I think for me, you know, I kind of see different industries at sort of different levels, but I think with COVID in particularly, you know, and frankly not just COVID, but even digital transformation alongside COVID is really driving a lot of AI in an accelerated manner. The other thing that I'll kind of talk to a little bit here is I still think we're very much in the early innings of this, right? There's a tremendous opportunity to innovate in this space. And I think we all know that, you know, data is continually being created every single day. And as more people become even more digitalized, there's more and more data being created. Like it's how do you start to harness that data more effectively, right, in your business every day. And frankly, I think we're just scratching the surface on it. And I think tremendous amount of opportunity as we move forward. >> Yeah, you really raised an interesting point which I hadn't thought about in terms of, we think about disruptors, we think about technology being a disruptor, right, but in this case it was purely, or really largely environment, you know, that was driving this disruption, right, forcing people to make these adoption moves and transitions maybe a little quicker than they expected. Well, so because of that, because maybe somebody had to speed up their timetable for deployments and what have you, what kind of challenges have they run into then, where, because as you describe it, it's not been the more organic kind of decision-making that might be made sometimes, situation dictated it. So what have you seen in terms of challenges, you know, barriers, or just a little more complexity, perhaps, for some people who're just now getting into the space because of the environment you were talking about? >> I think a lot of this is like, you know, people don't know where to get started, right, a lot of the time, or how AI can be applied. So a lot of this is going to be about education in terms of what it can and cannot do. And then it all depends on the use cases you're talking about, right? So if I think about, you know, building out machine learning models and those types of things, right, you know, the set of challenges that people will typically face in these types of things are, you know, how do I, you know, collect all the data that I need to go build these models, right? How do I organize that data? You know, how do I get the skillsets needed to ultimately, you know, take advantage of all of that data to actually then apply to where I need it in my business, right? So a lot of this is, you know, people need to understand those concepts or those pieces to ultimately be successful with AI. And you know, what IBM is doing right here, and I'll kind of, this will be a key theme throughout this conversation today is, you know, how do you sort of lower the time to value to get there across that spectrum, but also, you know, frankly, the skills required along the way as well? But a lot of it is like, people don't know what they don't know at the end of the day. >> Well, let me ask you about your AI play then. A lot of people involved in this space, as you well know, competition's pretty fierce and pretty widespread. There's a deep bench here. In terms of IBM though, what do you see as kind of your market differentiator then? You know, what do you think sets you apart in terms of what you're offering in terms of AI deployments and solutions? >> No, that's a great question. I think it's a multifaceted answer, frankly. The first thing I'll kind of talk through a little bit, right, is really around our platform and our framework, right? We kind of refer to as our AI ladder, but it's really an integrated, you know, sort of cohesive platform for companies around the journey to AI, right? So kind of what I was mentioning a bit earlier, right? If you think about, you know, AI is really about supplying the right data into AI, and then being able to infuse it to where you need it to go, right? So to do that, you need a lot of the underlying information architecture to do that, right? So you need the ability to collect the data. You need the ability to organize the data. You need the ability to build out these models or analyze the data, right? And then of course you need to be able to infuse that AI wherever you need it to be, right? And so we have a really nice integrated platform that frankly can be deployed on any cloud, right, so we get the flexibility of that deployment model with that integrated platform. And if you think about it, we also have built, right, you know, sort of these industry-leading AI applications that sit on top of that platform and that underlying infrastructure, right? So Watson Assistant, right, our conversational AI which we'll talk probably a little bit more on this conversation, right? Watson Discovery focused on, you know, intelligent document processing, right, AI search type applications. We've got these sort of market-leading applications that sit on top, but there's also other things, right? Like we have a very, very strong research arm, right, that continues to invest and funnel innovations into our product platform and into our product portfolio, right? I think many people are aware of Project Debater we took on some of the top debaters in the world, right? But research ultimately is very much tied, right, and even, you know, some of the teams that I work with on the ground, we've got them tied directly into the squads that build these products, right? So we have this really big strong research arm that continues to bring innovation around AI and around other aspects into that product portfolio. But it's not just- >> I'm sorry go ahead, please. >> Go ahead, sorry. >> No, no, you go, (laughs) I interrupted, you go ahead. >> Don't worry, I was just going to say, the other two things I'll say like, you know, I'm saying this right, but we've got a lot of sort of proof points in around it, right, so if you talk about the scale, right, the number of customers, the number of case studies, the number of references across the board, right, in around AI at IBM it is significant, right? And not only that, but we've got a lot of, sort of I'll say industry and third-party industry recognition, right? So think about most people are aware of sort of Gartner Magic Quadrants, right, and we're the leader almost across the board, right, or a leader across the board. So, you know, cloud AI developer service, insight engines, machine learning, go down the line. So, you know, if you don't trust me, there's certainly a lot of third party validation around that as well, if that makes sense. >> Yeah, sure does. You know, we hear a lot about conversational AI and, you know, with online chat bots and voice assistance, and a myriad applications in that respect. Let's talk about conversational right now. Some people think is a little narrow, but yet there appears to be a pretty broad opportunity at the same time. So let's talk about that conversational AI element to what you're talking about at IBM and how that is coming into play. And perhaps is a pretty big growth sector in this space. >> Yeah, I think, again, I talk about scratching the surface, early innings, you'll see that theme a lot too. And I think this is another area around that, right? So, listen, let's talk about the broader side. Let's first talk about where conversational AI is typically applied, right? So you see it in customer service. That's the obvious place where I've seen the most deployments in. But if you think about, it's not just really around customer service, right? There's use cases around sales and marketing. You can think about, you know, lead qualification for example, right. You know, I'm on a website, how can I get information about a product or service? How can I automate some of that information collection, answering questions, how can I schedule console? All those things can be automated using, right, conversational AI, but organizations don't want these sort of points solutions across the customer journey. What they're ultimately looking for is a single assistant to kind of, you know, front that particular customer. So what if I do come on from a lead qual perspective, but really I'm not there for lead qual, I'm actually a customer, and I want to get a question answered, right? You don't want to have these awkward starts and stops with organizations, right? So on the customer side where we see the conversational AI going is really sort of covering that whole gambit in terms of that customer journey, right? And it's not just the customer journey, but you also want to be across channels, right? So you can imagine not just, you know, the website and the chat on the website, but also, right, across your messaging channels, across your phone, right? And not just that, but you also want to be able to have a really nice experience around, hey maybe I'm on a phone call with some automation, but I need to be able to hand them off to a digital play, right? Maybe that's easier to sign up for a particular offer, or do some authentication, or whatever it might be, right? So to sort of be able to switch between the channels is really, really going to become more important in terms of a seamless experience as you do kind of go through it, right- >> So let's talk about customers- >> Oh, go ahead sir. >> Yeah, you talked about customers a little bit, and you mentioned case studies, but I hope we can get into some specifics, if you can give us some examples about people, companies with whom you've worked and some success that you've had in that respect. And I think maybe the usual suspects come to mind. I think about finance, I think about healthcare, but you said, "Hey buddy, but customer call issues, you know, service centers, that kind of thing would certainly come into play," but can you give us an idea or some examples of deployments and how this is actually working today? >> Oh, absolutely, right? So I think you were kind of mentioning, you were talking about sort of industries that are relevant, right? So, you know, the ones that I think are most relevant that we've seen are the ones with the biggest sort of consumer side of it, right? So clearly in financial services, banks, insurance are clearly obvious ones. Telecommunication, retail, healthcare, these are all sort of big industries with a lot of sort of customers coming in, right? And so you'll see different use cases in those industries as well, right? So the obvious one, we've got a really good client, Royal Bank of Scotland, they've now changed their name to NatWest in Scotland. So they started out with customer service, right? So dealing with personal banking questions through their website. What's interesting, and you'll see this with a lot of these use cases is they will start small, right, with a single use case, but they'll start to expand from there. So for example, NatWest, right, they're starting with personal banking, but they're now expanding to other areas of the business across that customer journey, right? So that's a great example of where we've seen it. Cardinal Health, right, because we're not dealing with customers in terms of external customers, but dealing with internal customers, right, from an IT help desk standpoint. So it's not always external customers. Oftentimes, frankly, it can be employees, right? So they are using it through an IDR system, right? So through over the phone, right, so I can call, instead of getting that 1-800 number, I'm going to get a nice natural language experience over the phone to help employees with common problems that they have with their help desk. So, and they started really, really small, right? They started with, you know, simple things like password resets, but that represented a tremendous amount of volume that ultimately hit at their call centers. So NatWest is a great example. CIBC, another bank in Canada, Toronto, is a great example. And the nice thing about what CIBC is doing and they're a big, you know, we have four big banks here in Canada. What CIBC do is really focusing a lot on the transactional side. So making it really easy to do interact transfers or send money, or all those types of things, or check your balance or whatever it might be. So putting a nice, simple interface on some of those common, transactional things that you would do with a bank as well. >> You know, before I let you go, I'd like to hit just a buzzword we hear a lot of these days, natural language processing, NLP. All right, so NLP, define that in terms of how you see it and how is it being applied today? Why does NLP matter, and what kind of differences is it making? >> Wow, natural language processing is a loaded term as a buzzword, I completely agree. I mean, listen, at the 50,000 foot level, natural language processing is really about understanding language, right? So what do I mean by that? So let's use the simple conversational example we just talked about. If somebody's asking about, you know, "I'd like to reset my password," right? You have to be able to understand, well what is the intent behind what that user is trying to do, right? They're trying to reset a password, right? So being able to understand that inquiry that user has that's coming in and being able to understand what the intent is behind it. That's sort of one key aspect of natural language processing, right? What is the intent or the topic around that paragraph or whatever it might be. The other sort of key thing around natural language processing, the importance of extracting certain things that you need to know. And again, using the conversational AI side, just for a minute, to give a simple example. If I said, "You know what, I need to reset my password." I know what the intent is, I want to reset a password, but, right, I don't know which password I'm trying to reset. Right, and so this is where sort of you have to be able to extract objects, and we call them entities a lot of the time and sort of the (indistinct) or lingo. But you got to be able to extract those elements. So, you know, I want to reset my ATM password. Great, right, so I know what they're trying to do, but I also need to extract that it's the ATM password that I'm trying to do. So that's one sort of key angle, natural language processing, and there's a lot of different AI techniques to be able to do those types of things. I'll also tell you though, there's a lot around the content side of the fence as well. So you can imagine how like a contract, right, and there were thousands of these contracts, and some of your terms may change. You know, how do you know, out of those thousands of contracts where the problems are, where I need to start looking, right? So another sort of key area of natural language processing is looking at the content itself, right? Can I look at these contracts and automatically understand that this is an indemnity clause, right? Or this is an obligation, right? Or those types of things, right, and being able to sort of pick those things out, so that I can help deal with those sort of contract-processing things. So that's sort of a second dimension. The third dimension I'll kind of give around this is really around, you can think about extracting things like sentiment, right? So we talked about, you know, extracting objects and nouns, and those types of things, but maybe I want to know in an analytics use case with customers, you know, what is the sentiment and, you know, analyzing social media posts or whatever it might be, what's the sentiment that people have around my product or service. So natural language process, if you think about it at the real high level is really about how do I understand language, but there's a variety of sort of ways to do that, if that makes sense. >> Yeah, no sure, and I think there are a lot of people out there saying, "Yeah, the sooner we can identify exasperation (laughs) the better off we're going to be, right, in handling the problems." So, it's hard work, but it's to make our lives easier, and congratulations for your fine work in that space. And thanks for joining us here on theCUBE. We appreciate the time today, Brian. >> Thank you very much. >> You bet, Brian Loveys, he's talking to us from IBM, talking about conversational AI and what it can do for you. I'm John Walls, thanks for joining us here on theCUBE. (upbeat music) ♪ Dah, deeah ♪ ♪ Dah, dee ♪ (chimes ringing)

>>from >>Around the globe. It's the cube with digital coverage of IBM think 2021 brought to you by IBM >>Well welcome everyone is the cube continues or IBM Thanks series. It's a pleasure to have you with us here on the cube. I'm john walls and we're joined today by brian loves who is the director of offering management for customer and employee care applications in the at IBM in the data and AI division. So brian, thanks for joining us from Ottawa Canada, good to see you today. >>Yeah, great to be here john I'm looking forward to the session today >>which by the way I've learned Ottawa is the home of the world's largest ice skating rink. I doubt we'll get into that today, but it is interesting food for thought. Uh so brian first off, let's just talk about um the Ai landscape right now. I know IBM obviously very heavily invested in that uh just in terms of how you see this currently as in terms of enterprise adoption, what people are doing with it and and just how you would talk about the state of the industry right now, >>you know, it's a really interesting one, right? I think if you look at it, you know different companies, different industries frankly are at different stages of their Ai journey, right? Um I think for me personally what was really interesting was, and we're all going through the pandemic right now, but last year with covid 19 in the March timeframe, it was really interesting to see the impact, frankly in the space that I played predominantly in around customer care, right? When the pandemic hit immediately call centers, contact centres got flooded with calls, right? And so it created a lot of problems for organizations. But it was interesting to me is it accelerated a lot of adoption of ai to organizations that typically lag and technology. Right? So if you think about public sector, right, that was one area that got hit very, very hard with questions and those types of things and trying to communicate and communicate out information. So it was really interesting to see those organizations frankly accelerate really, really quickly, right? And if you actually talk to those organizations now, I think one of the most interesting things to me and thinking about it and talking to them now is like, hey, you know, we can do this right, AI is really not that complicated, it can be simplified, we can take advantage of it and all of those types of things. Right? So I think for me, you know, I kind of see different industries that sort of different levels, but I think with Covid in particularly, you know, and frankly not just Covid, but even digital transformation alongside Covid is really driving a lot of ai in an accelerated manner. The other thing I'll kind of I'll kind of talk to a little bit here is I still think we're very much in the early innings of this, right, there is a tremendous opportunity innovating in the space and I think we all know that you know data is continually being created every single day and as more people become even more digitalized, there's more and more data being created. Like how do you start to harness that data more effectively, right in your business every day? And frankly I think we're just scratching scratching the surface on it and I think tremendous amount of opportunity as we move forward. >>Yeah, he really is really raised an interesting point which I hadn't thought about in terms of, we think about disruptors, we think about technology being a disrupter, right? But in this case it was purely really, largely environment that was driving this disruption, right, forcing people to to make these adoption moves and transitions maybe a little quicker than they expected. So because of that, because maybe somebody had to speed up their timetable for deployments and what have you what what kind of challenges have they run into them? Where because, as you describe it, it's not been the more organic kind of decision making that might be made, sometimes situation dictated it. So what have you seen in terms of challenges, barriers or just a little more complexity perhaps for some people who are just not getting into the space because of the environment you were talking about? >>I think a lot of this is like people don't know where to get started, right, a lot of the time or how ai can be applied. So a lot of this is going to be a bad education in terms of what it can and cannot do, and then it all depends on the use cases you're talking about, right? So if I think about, you know, building a machine learning models and those types of things right? You know, this set of challenges that people will typically face in these types of things are, you know, how do I collect all the data that I need to go build these models? Right? How do I organize that data? Um you know, how do I get the skill sets needed to ultimately, you know, take advantage of all that data to actually then apply to where I needed in my business? Right, So a lot of this is, you know, people need to understand, you know, those concepts are those pieces um to ultimately be successful with AI and you know what IBM is doing right here and I'll kind of this will be a key theme through this conversation today, is how do you sort of lower the time to value, to get there across that spectrum, but also, you know, frankly the skills >>required along the way as >>well, but a lot of it is like people don't know what they don't know at the end of the day. Mhm. >>Well, let me ask you about about your AI play then, a lot of people involved in this space, as you well know, you know, competitions pretty fierce and pretty widespread, there's a deep bench here um in terms of IBM know, what do you see is kind of your market different differentiator then, you know, what what do you think set you apart in terms of what you're offering in terms of AI deployments and solutions? >>No, that's a great question. I think it's a multifaceted answer, frankly. Um the first thing I'll kind of talk through a little bit right, is really around our platform and our our framework, right? We could refer to as our air ladder, um but it's really an integrated, you know, sort of cohesive platform for companies around the journey to AI, right? So kind of what I was mentioning earlier, right? If you think about, you know, AI is really about supplying the right data into A I. And then being able to infuse it to where you needed to go. Right? So to do that, you need a lot of the underlying information architecture to do that, Right? So you need the ability to collect the data, you need the ability to organize the data, you need the ability to to build out these models, right? Or analyze the data and then of course you need to be able to infuse that ai wherever you need it to be. Right. And so we have a really nice integrated platform that frankly can be deployed on any cloud. Right? So we got the flexibility that deployment model with that in greater platform. And you think about it? We also have built right, you know, sort of these industry leading Ai applications that sit on top of that platform and that underlying infrastructure. Right? So Watson assistant, Right. Our conversational AI, which we'll talk probably a little bit more on this conversation. Right, Watson discovery focus on, you know, intelligent document processing, right. AI search type applications. We've got these sort of market leading applications that sit on top, but there's also other things, right? Like we have a very, very strong research arm right, that continues to invest and funnel innovations into our product platform and into our product portfolio. Right? I think many people are aware of project debater, we took on some of the top debaters in the world, right? But research ultimately is very much tied, right? And even some of the teams that I work with on the ground, we've got them tied directly into the squads that build these products, Right? So we have this really big strong research arm that continues to bring innovation around AI and around other aspects into that product portfolio. But it's not just go ahead, >>Please go ahead. three. No, no. You know, I interrupted you. Go ahead. >>No, I was just gonna say that the other two things, I'll say it like, you know, I'm saying this right, but we've got a lot of sort of proof points and around it. Right? So, if you talk about the scale right? The number of customers, the number of case studies, a number of references across the board, right? In around AI AT IBM It is significant, Right? Um, and not only that, but we've got a lot of sort of, I'll say industry and third party industry recognition. Right? So think about most people are aware of sort of Gartner magic quadrants, right? And we're the leader almost across the board, Right? Or a leader across the board. So cloudy I developer service inside engines, machine learning go down the line. So, you know, if you don't trust me, there's certainly a lot of third party validation around that as well. That makes sense. >>Yeah, it sure does. You know, we're hearing a lot about conversational AI and, you know, with online chat bots and voice assistance and a myriad applications in that respect. Let's talk about conversational right now. Some people think it's little narrow, but, but yet there appears to be a pretty broad opportunity at the same time. So let's talk about that conversational AI um, uh, element um, to what you're talking about at IBM and how that is coming into play and, and perhaps is a pretty big growth sector in this space. >>Yeah, I think again, I talked about scratching the surface early innings. You'll see that theme a lot too. And I think this is another area around that. So listen, let's talk about the broader side. Let's first talk about where conversation always typically applied. Right? So you see it in customer service, that's the obvious place we're seeing the most appointments in. But if you think about, it's not just really around customer service, right? There's use cases around sales and marketing. If you think about, you know, lead qualification, for example, right? How can, you know, I'm on a website, how can I get information about a product or service? How can I automate some of that information collection, answering questions? How can I schedule console? All those things can be automated using great conversationally. I, the organizations don't want these sort of point solutions across the customer journey. What we're ultimately looking for is a single assistant to kind of, you know, front right, that particular customer. So what if I do come on from a legal perspective, but really I'm not here for legal. I'm actually a customer and I want to get a question answered, right? You don't want to have these awkward starts and stops with organizations, Right? So on the customer side where we see the conversation like, hey, I going and it's really kind of covering that full gambit in terms of that customer journey, right? And it's not just the customer journey, but you also want to be across channels, right? So you can imagine right now, not just, you know, the website and the chat on the website, but also right across their messaging channels, right across your phone. Right. And not just that, but you also want to be a really nice experience around, hey, maybe I'm on a phone call with some automation, but I need to be able to hand them off to a digital play. Right? Maybe that's easier to sign up for a particular offer or do some authentication or whatever might be, right. So to sort of be able to sort of switch between the channels, it's really, really going to become more important in this sort of sort of seamless experience as you just kind of go through it. Right? >>So you're coming by customers. Yeah. >>You talked about customers a little bit and you mentioned case studies, but can we get, I hope we can get into some specifics. You can give us some examples about people, companies with whom you've worked and and some success that you've had that respect. And I think maybe the usual suspects come to mind about finance. I might health care, but you said anybody with customer call issues, service centers, that kind of thing would certainly come into play. But can you give us an idea or some examples of deployments and how this is actually working today? >>Oh, absolutely. Right. So I think you kind of mentioned you become sort of industries that are relevant. Right? So, you know, the ones that I think are most relevant that we've seen are the ones with the biggest sort of consumer sort of side to it. Right? So clearly in financial services, banks, insurance, and clearly obvious ones telecommunications, retail, healthcare, these are all sort of big industries with a lot of sort of customers coming in. Right? So you'll see different use cases in those industries as well. Right. So the obvious one, we've got a really good client, Royal Bank of Scotland, they've now changed their name to natwest Open Scotland. Um So they started out with customer service. Right? So dealing with personal banking questions through their website, what's interesting and you'll see this with a lot of these use cases is they will start small, right with a single use case that they'll start to expand from there. So, for example, >>natwest right there, starting with they started with personal banking, but they're not expanding to other areas of the business across that customer journey. Right. So it's a great example of where we've seen it. Cardinal Health Right. We're not dealing with customers in terms of external customers but dealing with internal customers right from the help that standpoint. So it's not always external customers. Oftentimes frankly it can be employees. Right? So they are using it right through an I. V. R. System. Right? So through over the phone. Right. So I can call instead of getting that 1 800 number. I'm going to get a nice natural language experience over the phone to help employees with common problems that they have with their health does so. And they started really, really small, right? They started with simple things like password resets but that represented a tremendous amount of volume but ultimately headed their cost cost centers. So not West is a great example. C I B C. Another bank in Canada Toronto is a great example and the nice thing about what CNBC is doing and there are big, you know, we have four big banks here in Canada, what have you seen do is really focusing a lot on the transactional side. So making it really easy to do interact transfers or send money or over those types of things or check your balance or whatever it might be. So putting a nice simple interface on some of those common transactional things that you >>would do with the bank as well, >>you know, before I let you go, uh I'd like to hit this of buzz where we hear a lot of these days natural language processing. NLP Alright, so, so NLP define that in terms of how you see it and and how is it being applied today? Why why does NLP matter? And what kind of difference is it making? >>Wow, that's a loaded natural language processing. There's a loaded term in a buzzword. I completely agree. I mean listen, at the 50,000 ft level, natural language processing is really about understanding length, Right? So what do I mean by that? So let's use the simple conversational example. We just talked about if somebody is asking about, I'd like to reset my password right? You have to be able to understand what is the intent behind what that user is trying to do right there? Trying to reset a password, right? So being able to understand that inquiry that the user has that's coming in and being able to understand what the intent is behind it. >>That's sort of one, you know, aspect of natural language processing, right? What is the intent or the topic around that paragraph or whatever it might be. The other sort of key thing around natural language processing the importance, extracting certain things that you need to know. And again using the conversational ai side, just for a minute to give a simple example if I said you know what I need to reset my password, I know what the intent is. I want to reset a password but Right I don't know which password I'm trying to reset. Right? So this is where you have to be able to extract objects and we call them entities a lot of time in sort of the ice bake or lingo but you've got to be able to extract those elements. So you know I want to reset my A. T. M. Password. Great. Right so I know what they're trying to do but I also need to extract that it's the A. T. M. Password that I'm trying to do. So that's one sort of key angle of natural language processing and there's a lot of different techniques to be able to do those types of things. I'll also tell you though there's a lot around the content side of the fence as well, right? So you can imagine having a contract, right? And there are thousands of these contracts and some of your terms may change. How do you know, out of those thousands of contracts where the problems are, where I need to start looking, Right? So another sort of keep key area of natural language processing is looking at the content itself. Can I look at these contracts and automatically understand that this is an indemnity clause, Right? And this is an obligation, right? Or those types of things, right? And be able to sort of pick pick those things out so that I can help deal with those sort of contract processing things. That's sort of a second dimension. The third dimensional kind of kind of give around this is really around. You can think about extracting things like sentiment, right? So we talked about, you know, extracting objects and downs and those types of things. But maybe I want to know and analytics use case with customers. Um you know, what is the sentiment and you know, analyzing social media posts or whatever it might be. What's the sentiment that people have around my product or service? So naturally this process, if you think about it, the real high level is really about how do I understand language? But there's a variety of sort of ways to do that if that makes sense? >>Yeah, sure. And I think there's a lot of people out there saying, yeah, the sooner we can identify exasperation, the better off we're going to be right and handling the problems. But it's hard work but it's to make our lives easier and congratulations for your fine work in that space. And thanks for joining us here on the cube. We appreciate the time. Today, brian, >>thank very much. >>You bet BRian Levine is talking to us from IBM talking about conversational Ai and what it can do for you. I'm john Walsh, thanks for joining us here on the cube. Mhm. >>Mhm.

(upbeat music) >> Hello and welcome to this Cube conversation. I'm John Furrier, your host of theCube here in Palo Alto, California. We're here in 2021 as we get through the pandemic and vaccine on the horizon all around the world. It's great to welcome Sandy Carter, Vice President of Partners and Programs with Amazon Web Services. Sandy, great to see you. I wanted to check in with you for a couple of reasons. One is just get a take on the landscape of the marketplace as well as you've got some always good programs going on. You're in the middle of all the action. Great to see you. >> Nice to see you too, John. Thanks for having me. >> So one of the things that's come out of this COVID and as we get ready to come out of the pandemic you starting to see some patterns emerging, and that is cloud and cloud-native technologies and SAS and the new platforming and refactoring using cloud has created an opportunity for companies. Your partner group within public sector and beyond is just completely exploding and value creation. Changing the world's society is now accelerated. We've covered that in the past, certainly in detail last year at re:Invent. Now more than ever it's more important. You're doing some pretty cutting things. What's your update here for us? >> Well, John, we're really excited because you know the heartbeat of countries of the United States globally are small and medium businesses. So today we're really excited to launch Think Big for Small Business. It's a program that helps accelerate public sector serving small and diverse partners. So you know that these small and medium businesses are just the engine for inclusive growth and strategy. We talked about some stats today, but according to the World Bank, smaller medium business accounts for 98% of all companies, they contribute a 50% of the GDP, two-thirds of the employment opportunities, and the fastest growing areas are in minority owned businesses, women, black owned, brown owned, veteran owned, aborigine, ethnic minorities who are just vital to the economic role. And so today this program enables us as AWS to support this partner group to overcome the challenges that they're seeing today in their business with some benefits specifically targeted for them from AWS. >> Can I ask you what was the driver behind this? Obviously, we're seeing the pandemic and you can't look at on the TV or in the news without seeing the impact that small businesses had. So I can almost imagine that might be some motivation, but what is some of the conversations that you're having? Why this program? Why think Big for Small Business pilot experience that you're launch? >> Well, it's really interesting. The COVID obviously plays a role here because COVID hit small and medium businesses harder, but we also, you know, part of Amazon is working backwards from the customers. So we collected feedback from small businesses on their experience in working with us. They all want to work with us. And essentially they told us that they need a little bit more help, a little bit more push around programmatic benefits. So we listened to them to see what was happening. In addition, AWS grew up with a startup community. That's how we grew up. And so we wanted to also reflect our heritage and our commitment to these partners who represent such a heartbeat of many different economies. That was really the main driver. And today we had, John, one of our follow the sun. So we're doing sessions in Latin America, Canada, the US, APJ, Europe. And if you had heard these partners today it was just such a great story of how we were able to help them and help them grow. >> One of the cultural changes that we've been reporting on SiliconANGLE, you're seeing it all over the world is the shift in who's adopting, who's starting businesses. And you're seeing, you mentioned minority owned businesses but it goes beyond that. Now you have complete diverse set entrepreneurial activity. And cloud has generated this democratization wave. You starting to see businesses highly accelerated. I mean, more than ever, I've never seen in the entrepreneurial equation the ability to start, get started and get to success, get to some measurable MVP, minimal viable product, and then ultimately to success faster than ever before. This has opened up the doors to anyone to be an entrepreneur. And so this brings up the conversation of equality in entrepreneurship. I know this is close to your heart. Share your thoughts on this big trend. >> Yeah, and that's why this program it's not just a great I think achievement for AWS, but it's very personal to the entire public sector team. If you look at entrepreneurs like, Lisa Burnett, she's the President and Managing Director of DLZP. They are a female owned minority owned business from Texas. And as you listen to her story about equity, she has this amazing business, migrating Oracle workloads over to AWS, but as she started growing she needed help understanding a little bit more about what AWS could bring to the table, how we could help her, what go to market strategies we could bring, and so that equalizer was this program. She was part of our pilot. We also had John Wieler on. He is the Vice President of Biz Dev from IMT out of Canada. And he is focused on government for Canada. And as a small business, he said today something that was so impactful, he goes, "Amazon never asked me if I'm a small business. They now treat me like I'm big. I feel like I'm one of the big guys and that enables me grow even bigger." And we also talked today to Juan Pablo De Rosa. He's the CEO of Technogi. And it's a small business in Mexico. And what do they do? They do migrations. They just migrate legacy workloads over. And again, back to that equality point you made, how cool was it that here's this company in Mexico, and they're doing all these migrations and we can help them even be more successful and to drive more jobs in the region. It's a very equalizing program and something that we're very proud of. >> You know what I love about your job and I love talking to you about this (Sandy laughs) because it's so much fun. You have a global perspective. It's not just United States. There's a global perspective. This event you're having this morning that you kicked off with is not just in the US, it's a follow the sun kind of a community. You got quite the global community developing there, Sandy. Can you share some insight behind the curtain, behind AWS, how this is developing? How you're handling it? What you're doing to nurture and grow that community that really wants to engage with you because you are making them feel big because (laughs) that's what cloud does. It makes them punch above their weight class and innovate. >> Yeah, that's very correct. >> This is the core thesis of Amazon. So you've got a community developing, how are you handling it? How are you building it? How are you nurturing it? What are your thoughts? >> You know what, John? You're so insightful because that's actually the goal of this program. We want to help these partners. We want to help them grow. But our ultimate goal is to build that small and medium business community that is based on AWS. In fact, at re:Invent this year, we were able to talk about MST which is based out of Malaysia, as well as cloud prime based out of Korea. And just by talking about it, those two CEOs reached out to each other from Korea and Malaysia and started talking. And then we today introduced folks from Mexico, and Canada, and the US, and Bulgaria. And so, we really pride ourselves on facilitating that community. Our dream here, our vision here is that we would build that small business community to be much more scalable but starting out by making those connections, having that mentoring that will be built in together, doing community meetings that advisory meetings together. We piloted this program in 2020. We already have 37 partners. And they told me as I met with them, they already feel like this small and medium business community or family. Family was the word they used, I think, moving forward. So you nailed it. That's the goal here is to create that community where people can share their thoughts and mentor each other. >> And it's on the ground floor too. It's just beginning. I think it's going to be so much larger. And to piggyback off that I want to also point out and highlight and get your reaction to is the success that you've been having and Amazon Web Services in general but mainly in the public sector side with the public private partnership. You're seeing this theme emerge really been a big way. I've been enclose to it and hosting and being interviewing a lot of folks at that, your customers whether it's cybersecurity in space, the Mars partnership that you guys just got on Mars with partnerships. So it's a global and interstellar soon to be huge everywhere. But this is a big discussion because as from cybersecurity, geopolitical to space, you have this partnership with public private because you can't do it alone. The public markets, the public sector cannot do it alone. And it pretty much everyone's agreeing to that. So this dynamic of public sector and partnering private public is a pretty big deal. Unpack that for us real quickly. >> Yeah, it really is a big deal. And in fact, we've worked with several companies. I'll just use one sector. Public Safety and Disaster Response. We just announced the competency at re:Invent for our tech partners. And what we found is that when communities are facing a disaster, it really is government or the public sector plus the private sector. We had many solutions where citizens are providing data that helps the government manage a disaster or manage or help in a public safety scenario to things like simple things you would think, but in one country they were looking at bicycle routes and discovered that certain bicycle routes there were more crashes. And so one of our partners decided to have the community provide the data. And so as they were collecting that data, putting in the data lake in AWS, the community or the private sector was providing the data that enabled the application, our Public Sector Partner application to identify places where bicycle accidents happen most often. And I love the story, John, because the CEO of the partner told me that they measured their results in terms of ELO, I'm sorry, ROL, Return on Lives not ROI, because they save so many lives just from that simple application. >> Yeah, and the data's all there. You just saw on the news, Tiger Woods got into a car accident and survived. And as it turns out to your point that's a curve in the road where a lot of accidents happen. And if that data was available that could have been telegraphed right into the car itself and slow down, kind of like almost a prevention. So he just an example of just all the innovation possibilities that are abound out there. >> And that's why we love our small businesses and startups too, John. They are driving that innovation. The startups are driving that innovation and we're able to then open access to that innovation to governments, agencies, healthcare providers, space. You mentioned Mars. One of our partners MAXR helped them with the robotics. So it's just a really cool experience where you can open up that innovation, help create new jobs through these small businesses and help them be successful. There's really nothing, nothing better. >> Can I ask you- >> Small, small is beautiful. >> Can I asked you a personal question on this been Mars thing? >> Yeah. >> What's it like at Amazon Web Services now because that was such a cool mission. I saw Teresa Carlson, had a post on the internet and LinkedIn as well as her blog post. You had posted a picture of me and you had thumbs were taking an old picture from in real life. Space is cool, Mars in particular, everyone's fixated on it. Pretty big accomplishment. What's it like at Amazon? People high five in each other pretty giddy, what's happening? >> Oh yeah. The thing about Amazon is people come here to change the world. That's what we want to do. We want to have an impact on history. We want to help make history. And we do it all on behalf of our customers. We're innovating on behalf of our customers. And so, I think we get excited when our customers are successful, when our partners are successful, which is why I'm so excited right now, John, because we did that session this morning, and as I listened to Juan Pablo Dela Rosa, and just all the partners, Lisa, John, and just to hear them say, "You helped us," that's what makes us giddy. And that's what makes us excited. So it could be something as big as Mars. We went to Mars but it's also doing something for small businesses as well. It runs the spectrum that really drives us and fuels that energy. And of course, we've got great leadership as you know, because you get to talk to Andy. Andy is such a great leader. He motivates and he inspires us as well to do more on behalf of our customer. >> Yeah, you guys are very customer focused and innovative which is really the kind of the secret sauce. I love the fact that small medium sized business can also be part of the solutions. And I truly believe that, and why I wanted us to promote and amplify what you're working on today is because the small medium size enterprise and business is the heart of the recovery on a global scale. So important and having the resources to do that, and doing it easily and consuming the cloud so that they can apply the value. It's going to change lives. I think the thing that people aren't really talking much about right now, is that the small medium size businesses will be the road to recovery. >> I agree with you. And I love this program because it does promote diversity, something that Amazon is very much focused on. It's global, so it has that global reach and it supports small business, and therefore the recovery that you talked about. So it is I think an amazing emphasis on all the things that really matter now. During COVID, John, we learned about what really matters, and this program focuses on those things and helping others. >> Well, great to see you. I know you're super busy. Thanks for coming on and sharing the update, and certainly talking about the small mid size business program. I'm sure you're busy getting ready to give the awards out to the winners this year. Looking forward to seeing that come up soon. >> Great. Thank you, John. And don't forget if you are a small and medium business partner 'cause this program is specifically for partners, check out Think Big for Small Business. >> Think Big for Small Business. Sandy Carter, here on theCube, sharing our insight, of course all the updates from the worldwide public sector partner program, doing great things. I'm John Furrier for theCube. Thanks for watching. (upbeat music)

>>from around the globe. It's >>the Q with digital coverage of AWS Public sector online brought to you by Amazon Web services. Hello. I'm John for a host of the Cube. We're here covering A W. S s international public sector virtual event. We have a great guest. The star of the program is Max Peterson, Good friend of the Cube. Also Vice President of A W s International for Public Sector Max. Great to see you. Thanks for coming on this virtual remote interview. Cuban interview. Hey, >>John. Great to be back on the Cube, even if it is virtual >>well, you know, we're not face to face. We have to go virtual. So the cube virtual, you've got to public sector summit. Virtual. Um, this is the time of the year where normally we'd be out on the road in Bahrain, Japan, Asia, Pacific Europe. We'd be out on the summits talking to all the guests and presenting that the update on public sector. But we have to do it remotely. Um, a little bit of trade off. The good news is with cove it for at least you guys. It's a global media network. And with these remote interviews. Uh, public sector is seeing a lot more global activity, and that's what I want to get your thoughts on. What is the business update internationally for public sector? I'm sure that with CO over the pandemic, you're seeing a lot of activity. How is the public sector business doing internationally? >>John, You know, you mentioned one of the silver linings of a pretty bad situation with the Koven pandemic. And that's been that it has meant that people have to be resourceful. Governments have to be resourceful on DSO. There's been a tremendous amount of innovation people have gotten used to now using modern cloud technology to support remote work and remote war learning. Um, out of necessity, we've had to figure out how do we deliver far greater health care services using digital technology, telemedicine, digital social care, uh, chime rooms? Uh, it really, in a nutshell, has been a tough six months for people, but a relative relatively busy six months for innovation. And for i t for the public sector customers, >>you know, I did an interview a few months ago for one of the award programs in Canada. Um, with the center had a customer on disk customers. The classic customer, a Amazon. You know, I'm not sure we do it all internally. He deployed A W S Connect in literally days that saved the lives of many of his countrymen and women by getting the entitlement checks out. And he was a glowing endorsement because, he said, with Cove in 19 they were crippled. He said they will. They stood up a call center and literally he was converted. That's just one example again. That's Canada of the kind of solutions that you guys air, enabling with Cloud to quickly respond to the crisis, to use technology to solve other technology problems and also business problems. Can you give an example on the international front of where you're seeing some activity? Because this seems to be the same pattern we're seeing, People who have used in the cloud we cube virtual. Will there be no Cuba's wasn't for our cloud implementations, but this is, um, obvious, but I want to call it out. It's important. Can you share some examples of people internationally using the cloud to get and respond to the to the cove in 19 pandemic in delivering services? >>Yeah, In fact, John, we're focusing a lot on that at the public sector summit online that comes up here in October. Um, a couple of quick examples. In fact, one of the top learnings is speed matters. And so we have Eve Curry from Australia, who talks about social and health care and how they were able to get a complete digital suite up and running for supporting 5000 elderly patients and over 3000 employees in less than a week, and that included getting up and running a video conferencing and tele consultation capability using AWS chime. It involved getting up and running collaboration space for the remote workers using work work docks. And it involves setting up a complete call center on the cloud, using Amazon time and literally that was done in less than a week. Another example, really ambitious example, which again is a testament to the innovation and, uh, the capability, the capability that AWS brings to customers. I'm in India. They had a number of tele medicine applications. They were available for a fee, but they didn't have a universal way to reach the vast population in India. And so when the pandemic hit three organization that was responsible for the public health component was challenged to get a no cost tele consultation hella medicine system up and running for outpatient services that could scale to reach a billion people. Um, they did that in 19 days. They got the system up and running Now hasn't gotten to a billion people online at one time. But there right now, doing 6000 consultations a day with about 4000 doctors, and they're headed toward 100,000 consultations today. Eso just to your point, speed and scale. We're seeing it across the board from from our public sector customers. >>You know, it's just mind boggling just to kind of pinch myself from it in 19 days. It's crazy, right? I mean, crazy fast If you throw back to the eighties and nineties when I broke into the business, you know, young gun client server was all the rage back then. And if you wanted to do, like a big apt upon an oracle s a p, whatever it was years, it was months just to do planning. E mean, I mean, think about the telemedicine example 19 days. That's huge. I mean, just the scale is just off the charts. So So I mean, even if you're not a believer in cloud I don't feel should be should just go home and retire at this point because it's just obvious. Uh, the question I wanna ask you specifically because Theresa brought this up on my last interview with her. And I wanna ask you the same question is, what is AWS doing specifically to help customers? I know customers are helping themselves. You mentioned that. What are you guys doing? Toe? Accelerate this. How are you helping of you guys changed a little bit. Can you just share what you guys specifically doing to help customers pivot toe not only solving it, but having a growth strategy behind it? >>Yeah, John, that's a great question. Some of the things that we're doing our long standing programs and so customers from day one have had a need for skills and workforce development. We keep on doubling down on those programs. Things like a W s academy aws educate our restart programs in different countries. So number one is we continue to help customers double down on getting the right cloud skills to enable the digital workforce. The second thing, in fact, if I can, for just amendment, um, there is actually a section of the public sector online called the New Workforce, which talks about both the digital skills that are required and then also some of the remote working skills that we need to help folks with. So So workforce is a big one. Um, the second one. Yeah, and I'm super excited about this because we've opened up the opportunity, form or customers around the globe to participate in our city on the Cloud Challenge Onda That gives a great opportunity to showcase and highlight the innovation of public sector customers and, you know, win some AWS credits and technical assistance to help them build their programs. But I think one of the most the things I'm most proud about in the last 6 to 9 months was when the when this pandemic struck and we listen to our customers about what they needed. We came out with something called the AWS Diagnostic Development Initiative, and that was a program specifically aimed at providing technical assistance. Um, a ws cloud credits all to researchers to help them, um, tackle the tough questions that need to be answered to help us deal with and then hopefully resolve the pandemic. >>So on the international front, like I said earlier in the open, we would've been in Bahrain. That's a new region, only a couple of years old, Obviously the historic, um this, um, geopolitical things happening there, opening things up, that's been a very successful region. This is the playbook. Can you just give us an update on some of the successes in the different regions by rain and then a pack and other areas? What? Some of the highlights? >>Sure, John, One of the things that I think it's super exciting is that all of these customers are developing new capabilities right now. Um, one example from Egypt. Uh, they had to get literally an entire student population back to school. When the pandemic hit on DSO. They quickly pivoted to bringing a online learning management system or LMS up on the cloud on AWS. Um, and they have been able to continue to teach classes, literally to millions of students there. We've seen that same sort of distance learning online education across the globe. Another example would be when countries needed to figure out how to beam or effective in that sort of time tested, contact tracing process. So So when ah person has been found to have the the flu or the illness the subject illness, um, they typically have a lot of manual contact tracers that have to try to identify kind of where that person's been and see if they can. Then, um, helped to control the spread of whatever the diseases Kobe 19. In this case, um, we put together with governments across the world with a W s partners across the world again in very fast order, automated systems to help governments manage this, um, Singapore is a super example. India's a massively scaled example, but we did it in countries of across the globe, and we did it by working with them and the partners there to specifically respond to their needs. So everybody's case, while similar at a high level, you know, was unique in the way that they had to implement it. >>And it's been a great, great ride international us with co vid. You guys have ah current situation. You guys are providing benefits and I'll see the cloud itself for the customer to build those modern APS. The question I wanna ask you, Max, as an executive at eight of yourself. So you've been in the industry, Um, with public sector pre covert, it's, you know, it's before Cove. And there's after Govind is gonna be kind of like that demarcation line in the society. Um, it has become a global thing. I just did an event with Cal Poly was mentioned before we came on, um, small little symposium that would have been, you know, face to face. But because we did it virtually it's now global reinvents coming up. That's gonna be essentially virtual. So it's gonna be more global, less physical, space to face. Everything is introduced, no boundaries. So how >>does that >>impact? How do you How do you guys, How do you look at that? Because it impacts you, I guess a little bit because there's no boundaries, >>right? You know, John, I think this plays into what we're talking about in terms of people and governments and organizations getting used to new ways of working on de so some of our new workforce development is based around that, not just the digital skills in the cloud skills a couple of the things that we've recognized by the way, Um, it's different, but done well, there's new benefits. And so so one of the things that we've seen is where people employ chime, for instance, Uh, video conferencing solution or solutions from our partners like Zoom and others. Onda people have been able to actually be Maurin touch, for instance, with elder care. Um, there were a number of countries that introduced shielding. That meant that people couldn't physically go and visit their moms and dads. Um and so what we've seen is a number of systems on care organizations that have responded andare helping thing the elderly, uh, to use this new tech on. But it's really actually, uh, heartwarming, uh, to see those connections happen again, even in this virtual world. And the interesting thing is, you can actually step up the frequency on DSO. You don't have to be there physically, but you can be there, Andi and interact and support with the number of these thes tools. I think one of the other big learnings that we've seen for many organizations and just about every public sector group has toe work with, um uh, their constituents on the phone. Of course, we've got physical offices, you know, whether it's a hospital or a outpatient center or a social care center. Um, but you always have to have a way to work on phones. What's happened during the Cove in 19 Pandemic is there's been a surge is where information needed to get out to citizens or where citizens literally rushed the phone lines to be able to get the most current information back. Andi, the legacy called systems have been completely overwhelmed, their inadequate. And we've seen customers launch the online call center in the cloud piece, using Amazon connect as their starting point. But then, you know, continuously innovating. And so starting to use things like Lex to be able to deliver a chat box function, Um, in the in the US, for example, one of our partners, Smartronix, was able to automate the welfare and social care systems for a number of different states to the point now where 90 plus percent of those calls get initially handled, satisfied using a chat bots, which frees up agents the deal, you know, with the more difficult inbound calls that they get. >>I gotta ask you, where do we go from here? What's next for these organizations? Post Covad World. You know, if we're sitting at a cocktail party was sitting down having dinner or where he talking remotely here, how would you? How would you explain to me what's what's next? Where do we go from here? And how do organizations take that next post co vid recovery and growth? What's your take? >>And John? I think that's a fantastic question to ask. Let me tell you what we learn from our customers every day because we see them try and do new things. If I had to take my sort of crystal ball, I think we're in version one of figuring out How do we work in this new environment? I think there's a couple of key things that we're going to see. Number one. Um, resilience and continuity of service is not gonna be optional. Everybody is coming to expect that government care, not for profits. Education is going to be able to seamlessly continue to deliver the core services irrespective of these world events or emergencies on B C customers. Now you know, really getting that right. It used to take. You talked about it? Um, heck, you couldn't get a system up and running in 19 days. You'd be lucky if you cut a purchase order in 19 days and citizens and constituents that aren't going to accept that anymore, right? That's one big, uh, change that I think is with us. And we'll keep on driving cloud adoption. I think the next one is how do we start putting the pieces together in ways that make some of this invisible and an example? Um, you know, kind of starts with that with that example in the US with partner that was building systems to help, uh, welfare and social care call centers operate smoother. But if you think about the range of AWS services and the building blocks that customers have, we'll find customers starting to create that virtual experience in aversion to dot away where they tie the contact center into chat box and into transcription. Like, for instance, being able to have a conversation with the parents and using comprehend medical actually get a medically accurate transcription. So the doctor can focus on that patient interaction and not on actually data captured, right, and then if that patient asks. Well, g Doc, could you give me more information about, you know, X y z, uh, medication, or about what a course of treatment sounds like? Instead of tying up the doctors time, you could go and use a tool like Amazon Polly to then go text to speech and give all of that further rich information to that citizen. Um e think some of them things. Same scenarios, right? How do we go from this? This very fast version one dot response to a a mawr immersive, less tech evident capability that strings these things together that to meet kind of unique use cases or unique needs. >>Yeah, I think that's totally right. I think you know the 19 days. Yeah, I'm blown away by that. But I think you know, we thought about agility. That was a cloud term. Being more agile with your code business. Agility has come on the scene and then with business agility you have I call I call business latency. Andi, you went from years to months, months, two days. And I think now, as you get into the decks versions, it's days, two hours, hours, two minutes, hours two seconds Because when you look at the scale of the cloud some of things we were talking what's going on? Space force and globally around with space Leighton See, technically and business late and see this is the new dynamic and it's gonna be automation. Ai these air. This is the new reality. I think co vid points that out. Uh, what's your reaction to that? And give a final message to the AWS international community out there on on how to get through this and what you guys are doing? >>Yeah, John, I think your observation is you know that increasingly, uh, there needs to be a connectedness between the services that thes public sector customers deliver on dso Um, that connectedness can be in terms of making sure that a citizen who eyes on their life journey doesn't need to continuously explain to government where they're at. But rather, government learns how to create secure, scalable data stores so that so that they understand the journey of the citizen and can provide help through that journey. Eso it becomes mawr citizen centric. I think another example is in the entire healthcare arena where what we have found is that the ability thio to securely collaborate on very complex problems and complex data sets? Uh, like like genomes, um is increasingly important on DSO. I think what you'll find is you'll find we're seeing it today, right? With customers like, uh, Genomics England and the UK Bio Bank were there, in fact, creating these secure collaboration spaces so that the best researchers can work against these very important data sets in a secure, yet trusted collaboration environment. So I think we're seeing much more of that on I would say The third thing that we're probably learning from our customers is just how important that skills and workforce pieces. Um, with the accelerated pace, we continue to see pressure on smart skills, and resource is that our customers need. Fortunately, we've got a great global partner ecosystem, Um, but you'll see us continuing to push that forward as a zone agenda that will help customers with eso. I guess my parting comment would be how could it not be? I hope that the customers that attend the summit are from all over the world. I hope they find something that's useful to them in pursuing their mission and in their journey to the cloud. And John, I just This is always a pleasure to join the Cube. Thanks very much for the time today. Thank >>you, Max. Great. Call out. Just I'll call it out. One more time to amplify the learnings in the workforce development starting younger and younger. The path to get proficiency is quickly. You could be a cloud computing cybersecurity application, modern application development, all hot areas. Uh, the new playbook is cloud. It's all there online. And, of course, Max. Global footprint with the regions, the world has changed, and it's gonna be pretty busy. Time for you. We'll be covering it. Thanks for coming on. >>That's great. Thanks, John. >>Okay, I'm John. Free with the Cube. You're watching any of US? Public sector summit, The international online event. I'm John. Hard to keep your host. Thank you for watching

>> Announcer: From around the globe, it's theCUBE with coverage of KubeCon + CloudNativeCon Europe 2020 Virtual brought to you by Red Hat, the Cloud Native Computing Foundation and Ecosystem partners. >> Welcome back I'm Stu Miniman, this is theCUBE's coverage of KubeCon + CloudNativeCon Europe 2020, the virtual event. Of course, when we talk about Cloud Native we talk about Kubernetes there's a lot that's happening to modernize the infrastructure but a very important thing that we're going to talk about today is also what's happening up the stack, what sits on top of it and some of the new use cases and applications that are enabled by all of this modern environment and for that we're going to talk about artificial intelligence and machine learning or AI and ML as we tend to talk in the industry, so happy to welcome to the program. We have two first time guests joining us from Red Hat. First of all, we have Abhinav Joshi and Tushar Katarki they are both senior managers, part of the OpenShift group. Abhinav is in the product marketing and Tushar is in product management. Abhinav and Tushar thank you so much for joining us. >> Thanks a lot, Stu, we're glad to be here. >> Thanks Stu and glad to be here at KubeCon. >> All right, so Abhinav I mentioned in the intro here, modernization of the infrastructure is awesome but really it's an enabler. We know... I'm an infrastructure person the whole reason we have infrastructure is to be able to drive those applications, interact with my data and the like and of course, AI and ML are exciting a lot going on there but can also be challenging. So, Abhinav if I could start with you bring us inside your customers that you're talking to, what are the challenges, the opportunities? What are they seeing in this space? Maybe what's been holding them back from really unlocking the value that is expected? >> Yup, that's a very good question to kick off the conversation. So what we are seeing as an organization they typically face a lot of challenges when they're trying to build an AI/ML environment, right? And the first one is like a talent shortage. There is a limited amount of the AI, ML expertise in the market and especially the data scientists that are responsible for building out the machine learning and the deep learning models. So yeah, it's hard to find them and to be able to retain them and also other talents like a data engineer or app DevOps folks as well and the lack of talent can actually stall the project. And the second key challenge that we see is the lack of the readily usable data. So the businesses collect a lot of data but they must find the right data and make it ready for the data scientists to be able to build out, to be able to test and train the machine learning models. If you don't have the right kind of data to the predictions that your model is going to do in the real world is only going to be so good. So that becomes a challenge as well, to be able to find and be able to wrangle the right kind of data. And the third key challenge that we see is the lack of the rapid availability of the compute infrastructure, the data and machine learning, and the app dev tools for the various personas like a data scientist or data engineer, the software developers and so on that can also slow down the project, right? Because if all your teams are waiting on the infrastructure and the tooling of their choice to be provisioned on a recurring basis and they don't get it in a timely manner, it can stall the projects. And then the next one is the lack of collaboration. So you have all these kinds of teams that are involved in the AI project, and they have to collaborate with each other because the work one of the team does has a dependency on a different team like say for example, the data scientists are responsible for building the machine learning models and then what they have to do is they have to work with the app dev teams to make sure the models get integrated as part of the app dev processes and ultimately rolled out into the production. So if all these teams are operating in say silos and there is lack of collaboration between the teams, so this can stall the projects as well. And finally, what we see is the data scientists they typically start the machine learning modeling on their individual PCs or laptops and they don't focus on the operational aspects of the solution. So what this means is when the IT teams have to roll all this out into a production kind of deployment, so they get challenged to take all the work that has been done by the individuals and then be able to make sense out of it, be able to make sure that it can be seamlessly brought up in a production environment in a consistent way, be it on-premises, be it in the cloud or be it say at the edge. So these are some of the key challenges that we see that the organizations are facing, as they say try to take the AI projects from pilot to production. >> Well, some of those things seem like repetition of what we've had in the past. Obviously silos have been the bane of IT moving forward and of course, for many years we've been talking about that gap between developers and what's happening in the operation side. So Tushar, help us connect the dots, containers, Kubernetes, the whole DevOps movement. How is this setting us up to actually be successful for solutions like AI and ML? >> Sure Stu I mean, in fact you said it right like in the world of software, in the world of microservices, in the world of app modernization, in the world of DevOps in the past 10, 15 years, but we have seen this evolution revolution happen with containers and Kubernetes driving more DevOps behavior, driving more agile behavior so this in fact is what we are trying to say here can ease up the cable to EIML also. So the various containers, Kubernetes, DevOps and OpenShift for software development is directly applicable for AI projects to make them move agile, to get them into production, to make them more valuable to organization so that they can realize the full potential of AI. We already touched upon a few personas so it's useful to think about who the users are, who the personas are. Abhinav I talked about data scientists these are the people who obviously do the machine learning itself, do the modeling. Then there are data engineers who do the plumbing who provide the essential data. Data is so essential to machine learning and deep learning and so there are data engineers that are app developers who in some ways will then use the output of what the data scientists have produced in terms of models and then incorporate them into services and of course, none of these things are purely cast in stone there's a lot of overlap you could find that data scientists are app developers as well, you'll see some of app developers being data scientist later data engineer. So it's a continuum rather than strict boundaries, but regardless what all of these personas groups of people need or experts need is self service to that preferred tools and compute and storage resources to be productive and then let's not forget the IT, engineering and operations teams that need to make all this happen in an easy, reliable, available manner and something that is really safe and secure. So containers help you, they help you quickly and easily deploy a broad set of machine learning tools, data tools across the cloud, the hybrid cloud from data center to public cloud to the edge in a very consistent way. Teams can therefore alternatively modify, change a shared container images, machine learning models with (indistinct) and track changes. And this could be applicable to both containers as well as to the data by the way and be transparent and transparency helps in collaboration but also it could help with the regulatory reasons later on in the process. And then with containers because of the inherent processes solution, resource control and protection from threat they can also be very secure. Now, Kubernetes takes it to the next level first of all, it forms a cluster of all your compute and data resources, and it helps you to run your containerized tools and whatever you develop on them in a consistent way with access to these shared compute and centralized compute and storage and networking resources from the data center, the edge or the public cloud. They provide things like resource management, workload scheduling, multi-tendency controls so that you can be a proper neighbors if you will, and quota enforcement right? Now that's Kubernetes now if you want to up level it further if you want to enhance what Kubernetes offers then you go into how do you write applications? How do you actually make those models into services? And that's where... and how do you lifecycle them? And that's sort of the power of Helm and for the more Kubernetes operators really comes into the picture and while Helm helps in installing some of this for a complete life cycle experience. A kubernetes operator is the way to go and they simplify the acceleration and deployment and life cycle management from end-to-end of your entire AI, ML tool chain. So all in all organizations therefore you'll see that they need to dial up and define models rapidly just like applications that's how they get ready out of it quickly. There is a lack of collaboration across teams as Abhinav pointed out earlier, as you noticed that has happened still in the world of software also. So we're talking about how do you bring those best practices here to AI, ML. DevOps approaches for machine learning operations or many analysts and others have started calling as MLOps. So how do you kind of bring DevOps to machine learning, and fosters better collaboration between teams, application developers and IT operations and create this feedback loop so that the time to production and the ability to take more machine learning into production and ML-powered applications into production increase is significant. So that's kind of the, where I wanted shine the light on what you were referring to earlier, Stu. >> All right, Abhinav of course one of the good things about OpenShift is you have quite a lot of customers that have deployed the solution over the years, bring us inside some of your customers what are they doing for AI, ML and help us understand really what differentiates OpenShift in the marketplace for this solution set. >> Yeah, absolutely that's a very good question as well and we're seeing a lot of traction in terms of all kinds of industries, right? Be it the financial services like healthcare, automotive, insurance, oil and gas, manufacturing and so on. For a wide variety of use cases and what we are seeing is at the end of the day like all these deployments are focused on helping improve the customer experience, be able to automate the business processes and then be able to help them increase the revenue, serve their customers better, and also be able to save costs. If you go to openshift.com/ai-ml it's got like a lot of customer stories in there but today I will not touch on three of the customers we have in terms of the different industries. The first one is like Royal Bank of Canada. So they are a top global financial institution based out of Canada and they have more than 17 million clients globally. So they recently announced that they build out an AI-powered private cloud platform that was based on OpenShift as well as the NVIDIA DGX AI compute system and this whole solution is actually helping them to transform the customer banking experience by being able to deliver an AI-powered intelligent apps and also at the same time being able to improve the operational efficiency of their organization. And now with this kind of a solution, what they're able to do is they're able to run thousands of simulations and be able to analyze millions of data points in a fraction of time as compared to the solution that they had before. Yeah, so like a lot of great work going on there but now the next one is the ETCA healthcare. So like ETCA is one of the leading healthcare providers in the country and they're based out of the Nashville, Tennessee. And they have more than 184 hospitals as well as more than 2,000 sites of care in the U.S. as well as in the UK. So what they did was they developed a very innovative machine learning power data platform on top of our OpenShift to help save lives. The first use case was to help with the early detection of sepsis like it's a life-threatening condition and then more recently they've been able to use OpenShift in the same kind of stack to be able to roll out the new applications that are powered by machine learning and deep learning let say to help them fight COVID-19. And recently they did a webinar as well that had all the details on the challenges they had like how did they go about it? Like the people, process and technology and then what the outcomes are. And we are proud to be a partner in the solution to help with such a noble cause. And the third example I want to share here is the BMW group and our partner DXC Technology what they've done is they've actually developed a very high performing data-driven data platform, a development platform based on OpenShift to be able to analyze the massive amount of data from the test fleet, the data and the speed of the say to help speed up the autonomous driving initiatives. And what they've also done is they've redesigned the connected drive capability that they have on top of OpenShift that's actually helping them provide various use cases to help improve the customer experience. With the customers and all of the customers are able to leverage a lot of different value-add services directly from within the car, their own cars. And then like last year at the Red Hat Summit they had a keynote as well and then this year at Summit, they were one of the Innovation Award winners. And we have a lot more stories but these are the three that I thought are actually compelling that I should talk about here on theCUBE. >> Yeah Abhinav just a quick follow up for you. One of the things of course we're looking at in 2020 is how has the COVID-19 pandemic, people working from home how has that impacted projects? I have to think that AI and ML are one of those projects that take a little bit longer to deploy, is it something that you see are they accelerating it? Are they putting on pause or are new project kicking off? Anything you can share from customers you're hearing right now as to the impact that they're seeing this year? >> Yeah what we are seeing is that the customers are now even more keen to be able to roll out the digital (indistinct) but we see a lot of customers are now on the accelerated timeline to be able to say complete the AI, ML project. So yeah, it's picking up a lot of momentum and we talk to a lot of analyst as well and they are reporting the same thing as well. But there is the interest that is actually like ramping up on the AI, ML projects like across their customer base. So yeah it's the right time to be looking at the innovation services that it can help improve the customer experience in the new virtual world that we live in now about COVID-19. >> All right, Tushar you mentioned that there's a few projects involved and of course we know at this conference there's a very large ecosystem. Red Hat is a strong contributor to many, many open source projects. Give us a little bit of a view as to in the AI, ML space who's involved, which pieces are important and how Red Hat looks at this entire ecosystem? >> Thank you, Stu so as you know technology partnerships and the power of open is really what is driving the technology world these days in any ways and particularly in the AI ecosystem. And that is mainly because one of the machine learning is in a bootstrap in the past 10 years or so and a lot of that emerging technology to take advantage of the emerging data as well as compute power has been built on the kind of the Linux ecosystem with openness and languages like popular languages like Python, et cetera. And so what you... and of course tons of technology based in Java but the point really here is that the ecosystem plays a big role and open plays a big role and that's kind of Red Hat's best cup of tea, if you will. And that really has plays a leadership role in the open ecosystem so if we take your question and kind of put it into two parts, what is the... what we are doing in the community and then what we are doing in terms of partnerships themselves, commercial partnerships, technology partnerships we'll take it one step at a time. In terms of the community itself, if you step back to the three years, we worked with other vendors and users, including Google and NVIDIA and H2O and other Seldon, et cetera, and both startups and big companies to develop this Kubeflow ecosystem. The Kubeflow is upstream community that is focused on developing MLOps as we talked about earlier end-to-end machine learning on top of Kubernetes. So Kubeflow right now is in 1.0 it happened a few months ago now it's actually at 1.1 you'll see that coupon here and then so that's the Kubeflow community in addition to that we are augmenting that with the Open Data Hub community which is something that extends the capabilities of the Kubeflow community to also add some of the data pipelining stuff and some of the data stuff that I talked about and forms a reference architecture on how to run some of this on top of OpenShift. So the Open Data Hub community also has a great way of including partners from a technology partnership perspective and then tie that with something that I mentioned earlier, which is the idea of Kubernetes operators. Now, if you take a step back as I mentioned earlier, Kubernetes operators help manage the life cycle of the entire application or containerized application including not only the configuration on day one but also day two activities like update and backups, restore et cetera whatever the application needs. Afford proper functioning that a "operator" needs for it to make sure so anyways, the Kubernetes operators ecosystem is also flourishing and we haven't faced that with the OperatorHub.io which is a community marketplace if you will, I don't call it marketplace a community hub because it's just comprised of community operators. So the Open Data Hub actually can take community operators and can show you how to run that on top of OpenShift and manage the life cycle. Now that's the reference architecture. Now, the other aspect of it really is as I mentioned earlier is the commercial aspect of it. It is from a customer point of view, how do I get certified, supported software? And to that extent, what we have is at the top of the... from a user experience point of view, we have certified operators and certified applications from the AI, ML, ISV community in the Red Hat marketplace. And from the Red Hat marketplace is where it becomes easy for end users to easily deploy these ISVs and manage the complete life cycle as I said. Some of the examples of these kinds of ISVs include startups like H2O although H2O is kind of well known in certain sectors PerceptiLabs, Cnvrg, Seldon, Starburst et cetera and then on the other side, we do have other big giants also in this which includes partnerships with NVIDIA, Cloudera et cetera that we have announced, including our also SaaS I got to mention. So anyways these provide... create that rich ecosystem for data scientists to take advantage of. A TEDx Summit back in April, we along with Cloudera, SaaS Anaconda showcased a live demo that shows all these things to working together on top of OpenShift with this operator kind of idea that I talked about. So I welcome people to go and take a look the openshift.com/ai-ml that Abhinav already referenced should have a link to that it take a simple Google search might download if you need some of that, but anyways and the other part of it is really our work with the hardware OEMs right? And so obviously NVIDIA GPUs is obviously hardware, and that accelerations is really important in this world but we are also working with other OEM partners like HP and Dell to produce this accelerated AI platform that turnkey solutions to run your data-- to create this open AI platform for "private cloud" or the data center. The other thing obviously is IBM, IBM Cloud Pak for Data is based on OpenShift that has been around for some time and is seeing very good traction, if you think about a very turnkey solution, IBM Cloud Pak is definitely kind of well ahead in that and then finally Red Hat is about driving innovation in the open-source community. So, as I said earlier, we are doing the Open Data Hub which that reference architecture that showcases a combination of upstream open source projects and all these ISV ecosystems coming together. So I welcome you to take a look at that at opendatahub.io So I think that would be kind of the some total of how we are not only doing open and community building but also doing certifications and providing to our customers that assurance that they can run these tools in production with the help of a rich certified ecosystem. >> And customer is always key to us so that's the other thing that the goal here is to provide our customers with a choice, right? They can go with open source or they can go with a commercial solution as well. So you want to make sure that they get the best in cloud experience on top of our OpenShift and our broader portfolio as well. >> All right great, great note to end on, Abhinav thank you so much and Tushar great to see the maturation in this space, such an important use case. Really appreciate you sharing this with theCUBE and Kubecon community. >> Thank you, Stu. >> Thank you, Stu. >> Okay thank you and thanks a lot and have a great rest of the show. Thanks everyone, stay safe. >> Thanks you and stay with us for a lot more coverage from KubeCon + CloudNativeCon Europe 2020, the virtual edition I'm Stu Miniman and thank you as always for watching theCUBE. (soft upbeat music plays)

>> from Bahrain. It's the Q recovery AWS public sector Bahrain, brought to you by Amazon Web service is >> hello and welcome to the cube coverage here for a W s summit in by rain in the Middle East. I'm John for the host of the Cube, where here's our second year covering the evolution of cloud computing in the region. Changing the landscape of entrepreneurship Government society actually, data is the new oil so excited to have our next guest, Abdula Elmo, I kill who's the co founder and partner at rain hot. Start up with some seed funding, I think has cracked the code on the crypto money making aspect of crypto currency. Welcome to the Cube. Thank you. Thank you. So let's get started. You guys have a small team, get some seed funding. Interesting strategy on crypt. Everyone. When I see oh, kind of a fraudulent markets international, we all come and watch in the I c e o u s cramping down on it. Ah, lot of entrepreneurs love this market. A lot of innovation. You guys had a different approach and do some very innovative taking me explain what rain is doing because you've cracked the code on Crypto to Fiat. That's right, which has been the legit use case for making this all this >> Absolutely so all of the founders, the four founders? Yeah, Badawi, A. J. Nelson, Joseph Lago and I We've been in this industry for quite a while. We've been here 56 years, and we've seen all the hype cycles come and go about sometimes about Blockchain technology itself sometimes about the i c e o craze. Uh, and we've really just bought came down to what is the bit viable business model? We all were all entrepreneurs and we had looking for a new opportunity. Does with a lot of people coming into this industry with those with any innovation, lots of opportunities arise. And we've looked at the world and the world had many exchanges that were the most successful businesses in this industry. The exchanges facilitating the trade that was the most interest. That was the highest demand. That was the real use case. And we found that, um, there were exchanges popping up from around the world, but they weren't here any in the in the Middle East yet, And perhaps it was due to a regulatory, uncertain see or other difficulties of coming into this market. But Bahrain really opened up for us and we met with the Central Bank of Bahrain about three or four years ago and things really got started from there. >> And being a marketplace, you gotta have a lot of, you know, governance. It's all a lot of regulatory pressures from the folks that started. People who watch the Cube know that we've been very bullish on Krypton. We love Blockchain as an underlying technology. Yeah, that's, um, sustainability issues around Bitcoin and others. We recognize that, but in general this is a wave that cannot be denied. The moneys flow, right? So money's flowing in Kryptos, you scripted a crypto. You guys have the Fiat piece of it. So this brings on the first kind of liquidity opportunity in crypto thio. Real money? >> Yeah, absolutely. So that's our main goal is we're serving both retail and institutions and we believe there's going to be a lot of traffic from the traditional finance world, from institutions and individual investors into the crypt, a world and the opposite as well. A lot of people had challenges with taking the profits out of exchanges and withdrawing them to their bank in a regulatory compliant way. And that's really what we're solving here for the lowest fees in the region. >> But rain, once the blubbering, was to be modern society. They're going all in on cloud computing. They want to be a cloud country. They're open to new ideas. What attracted you, these guys? What made them different as it was that their vision was their posture on oversight? What was some of the things that make makes it work here? >> Well, at first it was the reception The behind central bank had a fintech unit already in in 2000 I think set a release 2017. So that was great. I think other central banks around the region and the world we're just starting. Then there was the behind fintech beh ah, dedicated working space for fintech companies here. So the ecosystem and the reception was really what attracted us at the beginning, other than knowing that Bahrain was a good financial hub for quite some time for the region. So we joined the Bahrain, um, Central banks regulatory sandbox which allowed us to experiment and test whether we can do this in a safe and secure way. And about a year and 1/2 later, uh, central bank drafted the regulations. Four crypto asset exchanges, brokerages s. So now that the regulation have got drafted and published, we graduated from the sandbox. Thankfully, and we were allowed to apply for the license shortly after we applied. We we earned the license. Thankfully. >> So what's next? What's goes on now? You do a lot of get a lot of work, A lot of coding. Gotta make sure the fintech compliance a lot of hurdles there. Yeah, I can understand that. What's now next? Got the regulation place? Yep. You'd expand. What's the plan? >> Well, we announced the license and Ah, a tte the same time, we also announced closing our seed round. So with that, we were able to grow our team the past month from, um, 8 to 9 people to 15 to 17 people now, and just more and more joining on board every day and are really our focus is growth. Now we're out of the sandbox. We don't have the limitations of the sandbox we had before, and we have banking relationships already made with different Banks s. So now we're just trying to reach out for the market. So we have grown our customer support team growing our engineering team hiring and comply a compliance officer, um, and other growth aspect. Just moving forward, >> getting up the basics of the business. That's right. What's your target audience gonna be? The inside solutions at first retail. What's the target audience? It's >> really both. It depends on what the market is providing. We've see institutional demand that has always relied on. When we spoke with institutions, they always relied on getting the license first because they don't want to operate with anyone unlike since, which makes it ah, you know, really interesting, because that means they haven't been able to get into the digital asset of crypto asset world the past few years while it's going up and down. So we we see ah, 50 50 divide most likely and what's going to be similar ratio than the rest of the world. But right now it's a lot of retail. Customers >> feel great to get your perspective here. It's even in the space. For a while, we saw the fire hype cycle go up, then the wet blanket Crypto Winter hit? Yeah, in the United States. Certainly it put a clamp down on most I CEOs. The SEC is right looking at a bunch of stars behavior, you know, Pretty Wild West is they call it, but an internationally still been pretty active even in the crypt A winter Go back, say 2018 Go back Last year on March it kind of stopped, got cold and then frosted over. Now it's been a block of ice. If you descript a winter, what's your take on it? What's the vibe? Internationally, I'll see Still money still flowing Bitcoins over 10,000 I think this morning, but still a lot of activity. Yes, some tokens have fallen away. Some are staying around. What's your assessment? >> So we've seen a lot of ah cycles. If you've been in this industry for 567 years, you'll see that we've had multiple of these winters, some of them lost, lasting longer than others on dhe. This late last one didn't didn't last as long as the one before. So what we really every time we see a ah boom, we have ah lot of media and a lot of people coming in brand new, trying to educate themselves about What is this? So we see just on everlasting cycle of just expansion on dhe. The price right now is not at the all time high, but it's still considered pretty significant at the beginning of the year was only about three or $4000. Right now it's about 10,000 and $100 for for a Bitcoin a cz with the eye CEOs. There have been a lot of concerns, rightfully so, because anyone can whip out a token and start selling it almost a security. But the central banker behind has a list of acceptable crypto assets that they will allow us to list. So right now we only have four crypto currencies are assets Bitcoin like coin ethereum and X R P. But nothing more than that at the time. And we hope to add more in the future. >> Ripples been taken some hits lately in the U. S. What about Eos and some of the other ones around the coin gets a corner, get some growth, you seeing some new things. How you guys gonna be evaluating some of these other new currencies? Is there a formula, you keep an eye on them. What's the consisted of concensus? What's that >> right? So we are agnostic to choosing the crypto asset that the color customers want to invest in it. If the central bank of behind accept this as secure liquid enough and, um, essentially time tested as well, For if it's been around for, let's say, 3 to 5 years with no network issues, then maybe retail customers can invest in it. But if it if it is just came up a brand new, we might come up. It's not time tested. Security wise, um, it hasn't gone through some certain pressures that are necessary for a network for payments are storing of value. >> So the central bank makes the decision on what they're gonna accept. What they >> listed in viable. That's right. But we we take customer input all the time. We started with just three, and then we had a lot of demand for exactly here in the region, and way listed it after getting improved. >> So we can't get Cube coin up there, can we? >> It defends the eyes that thinks he's coming. Okay, coming for two years in a row, knows >> what's coming. What's your final thoughts? The entrepreneurs out there because it's a lot of activity. This is one of those things where persistence really matters. No, your space Stay humble. Yeah, deal with these cycles because they are happening right? There is a There is a high velocity of cycles seasons, if you will, winter and summer. >> Well, I really think people should be should be more calculated to think long term with this technology. A lot of people are trying to make a quick buck or just make something, um, thinking that it's just a quick way to make money. But I really think people should educate themselves, both the entrepreneurs and the the retail investors that, uh, you know about the market about the technology so they can really see where the use cases might be of most need to the market. >> Talk about your, uh, your expansion plans. You have to to co founders in the US You're the co founders in Egypt. Is there gonna be a remote team? Is it going to be in by rain? What's the what's the hiring look like? Where's that where people will be located. >> So most of our if not all, of our customer support. Our client service agents are here in the in Bahrain. Um, we have the phone co founders now the to Joseph and a J from the Bay area there in behind as well here for the majority of the year there in the office. Now, um, the the engineering team, however, is a little scattered. Sometimes we we find we're security is a really high priority for us. It's the number one priority for us, as any Cryptocurrency exchange would be. So we re really scout talent and from the U. S. From Canada from other places around the world. Eso our engineering team is based in the Bay Area and other places in the U. S. Um, aside from Joseph, who leads it, who's the co founder here and behind. And the rest of the business and customer team is here behind. >> So really, the gating factor on hiring is making sure security's number one. So it's not so much. Get people filled in an office on the engineering front. >> No, it's definitely way. Look for high quality candidates, so that's our priority. We may be a small team, but they're all superstars. To be honest, >> what's been the biggest challenge that you guys have to overcome in this process because it's tough to get the license wasn't just being patient was. It's the diligence. What were some of the things that you overcame that were challenges? >> Well, it's it's definitely it definitely was a challenge to talk to. Ah, lot of regulators in the region. In general, Bahrain was by far the most cooperative. So right now the challenge is perhaps talking to other regulators when you talk expansion plans, we hoped we are serving the whole Middle East here from the from behind. But we'd idly, ideally want to also set up banking in Kuwait or youe or Saudi just so we can have better, quicker, on and off ramps for the customers. They're >> one of the big stories out. See Amazon Web service. It has a region here, um, pretty important. Pretty big deal. What's your take on what you think is gonna do for the region having a Amazon region multiple availability zones? What's that going to do for the entrepreneurship equation? >> I mean, it's fantastic. You see a lot of excitement here from entrepreneurs in the region and especially with regulation. How about having customer data stored here in the region? Um, it's really going to help. A lot of entrepreneurs also mitigate, You know, any downtime from hosting it in other places? >> New generation of entrepreneurship Hitting the scene here, isn't it? >> Yeah, it's really exciting. Lots of funding going around. Lots of ideas. Pretty really, really exciting for all entrepreneurs. >> Fail fast. As we always say, No one likes failure, but it takes Takes guts to start a company course. Of course. You know, thanks for coming. I appreciate it and say congratulations on your success. Thank you. Coverage Here we are in by rain for AWS summit. We're back with more after this short break.

(electronic music) >> Live from Toronto, Canada it's The Cube covering Blockchain Futurist Conference 2018. Brought to you by The Cube. >> Hello everyone, welcome back to The Cube live coverage here in Toronto, Canada Ontario for Untraceable presents Blockchain Futurist Conference. Two days we've been here. We're on day two, amazing event here, great community, I'm John Furrier your host. Dave Vellante went back east so he was here yesterday. Our next guest Pablo Gonzales is the Founder and CEO of Genesis Blockchain Technologies, welcome to The Cube thanks for joining me. >> Thank you for having me. >> So I'm glad to have you on. First of all when Bradley Rodder says oh watch out for that guy, you must be smart because we trust Bradley so but you're doing something really cool. The future of trading and exchanges has been a topic that everyone's been talking about but not a lot of people have been actually moving the needle on. You've got some movement here, people doing here but no one's actually had the full package and they're running as fast as they can to do it. You guys have done it. >> We have. >> How? Take a minute, what have you guys done? What is the product? How did you guys do it and what can people use today? >> Thank you. So it's no longer hot air, as you said. A lot of people are saying what they're going to do. We're here to say what we have done which is very different. Yesterday up at the main stage we launched the world's first decentralized exchange on a mobile platform. We're fully licensed by the Costa Rican Commodities Exchange, we have brokerage license, a currency exchange license and a money remittance license. We already possess the licenses, we're not in pursuit of the licenses we have them. What we did obviously we pursued an MNA strategy, we acquired companies that were over a decade in the business and we just transformed them and cryptomized them, as I use the term and launched the exchange with those licenses and platforms. We listed the exchange with over 40 coins. Over four billion dollars of shared market cap and over half a million dollars of daily trading and liquidity. >> So this is right now going on in Costa Rica, mainly if stable. Is it stable? How's the stability there? >> So Costa Rica is extremely stable, they haven't had an army for over 50 years, it's considered a world-class country for banking, for international businesses so much so. Amazon, HP, Intel, all these humongous companies have large operations in the country. >> And their posture to crypto is they've come out formally. >> Yes. >> To state well what's the posture from Costa Rica? >> So they consider cryptocurrencies a commodity and not a security and that's why went on to pursue a commodities exchange license. >> So that opens up doors for you to do this. >> Of course it opens up the doors, think about it. So you can now trade Bitcoin with gold. In our exchange, not as of today we're going to launch that in January, so now you can trade cryptocurrencies with commodities and cryptocurrencies with fiat currencies. >> So I'm just kind of speculating here in terms of my mind where I'm going with this. Almost imagine the shakeup that's coming. It's like a blender, we trading gold and Bitcoin it's just like who would have thought that was possible a year ago? >> That's correct. >> They've been compared, people compare Bitcoin to new digital gold but actually comparing them this is going to shakeup like a blender. >> That's correct. >> Blend up the commodities market. >> Disrupt it. >> What's your vision? What do you see happening? >> I just think that a lot of people are focusing on they say on one of the interviews earlier today, one of the interviewers was asking me is that Bitcoin to the moon? I'm like guys we need to stop. If we want this industry to really grow and develop stop using those analogies. We need to create a community that's larger, we need mass adoption and I think by including the commodities into the equation you're catering to the traditional investors that are a little bit uncomfortable with cryptocurrencies because they don't know about them but they know about gold and then all of a sudden now you compare gold with Bitcoin. >> It brings retail into it. >> Yes. >> It brings a real retail market. >> That's correct. >> You know I just want to say something. I agree with you 100%. These news outlets out there, these other people they tend to focus on the price of Bitcoin and it's almost like okay can we get over that? Yes it's going to go up and down, if you're in the long game it should be 20,000. Okay we can buy that but let's talk about what people are doing. Who's building something? >> Yes. >> That's the focus. So if I ask you now that question, hey Pablo what have you built and what you you going to continue to build if this is a foundational product, what are you guys going to do on top of it? What's the build plan? >> Thank you. So yesterday we launched the decentralized exchange with 40 coins. We're going to add probably between now and December another 110 different tokens. We're doing 20 for now and in January we're launching a centralized exchange so that's where we're going to add the fiat currencies and the commodities. >> What date again? >> End of January. >> Okay got it. >> Then we're going to make an announcement in November at one of the conferences in Malta and so we're reserving the date and everything else for that but in May of next year we're launching over the counter trading desk with full KYC AML you know counter terrorism financing, all of the world class policies and by this time next year we're going to be launching our institutional platform. So we want to be a one stop shop via the currency exchange that we own. We already have the ability from the Central Bank of Costa Rica which is amazing to issue Visa cards. So now our users, besides trading, they can take their crypto with them from their mobile phone, convert it to fiat and pay, you know, for gasoline, buy groceries. >> So I'm an entrepreneur, I got my own cube coin coming out, cube token, security token or utility, what's in it for me? If I asked you Pablo what's in it for me? What do I get out of it as a business? Are people going to start trading my coins? Am I instantly going to have an over the counter so as a business what do I have to worry about? What's the benefit? What matters to me? What's the impact? >> So if you were to be a coin to list on our exchange you mean? Well first of all we all know exchanges now to list on them you know they're changing, some of them I'm not going to say the name. >> They're charging a lot of money. >> Yeah 400 BTC and crazy amounts like this. We are going to charge. It's a business at the end of the day but what we're looking for with the coins that we're going to list is partnerships and seeing what ways we can do more entrepreneurial projects to change the landscape of the industry together as an exchange and a coin because potentially what a coin is is a company. You know what's behind the coin is what's important to us and not the coin itself. As the company develops and progresses so will the coin's price appreciated value or depreciated value and so yes, besides facilitating trading fees and lowering that, up listing and so forth what we're bringing to the table wants to be much more dynamic. >> You got to balance you know business that you got to do with infrastructure build out. It's like the old telecom days you got to build some cell towers before you roll out mobile. You got to build this entire retail global fabric. >> Yes. How does community play in for it? Obviously community is very important. I agree with you that's big time. How are you guys building your community? Tapping into anything else? Obviously Untraceable has got a great community. How are you going to grow your community. >> So as an exchange there could be a conflict of interest we have to be really careful how we get involved in the community but what we want to do is by selected partnerships with projects and coins. The coins are already doing their work. They are appealing to a community. They are raising the money from that community what we want to do is we want to partner up with those coins, the coins that are worth partnering up with and that way our reach automatically will multiply. On top of that of course we want to work with government and banks and institutions. We believe, it may not be popular what I'm about to say, you know the good old honor kids that came to the hardcore crypto, forget about central banks and centralization, I don't think that that's ever going to happen. I think the more we cooperate with government, that the more we work with them, we together can shape the industry and the landscape for good. I do believe in that. It's a collaboration and cooperation with governments and banks to us is pivotal. >> I mean you can be a coach to the regulatory. >> Absolutely. >> You can be an advocate and partner. >> We are being. >> And not an enemy. >> In Costa Rica, so before they considered and they took a position on whether is was a commodity or not you know they approached us and we were teaching them so much so that a congressman that was going to be at the conference and couldn't make it, he's the founder of the Libertarian movement in Costa Rica he created a think tank of crypto because of us that now has Latin America reach. Think about it, there are 1.3 billion people in Latin America. >> They have mobile phones. >> Exactly. That can now learn about crypto and so we're going to capitalize on this. >> It's a real democratization, what you do is change a society. If you continue to get this right this is really key. Congratulations. Now I want to ask you personal questions so I love the hat, you look great. >> Thank you. >> How did you get here? Were you scratching an itch that was around this? Was it, how did you get to the point where you said hey I'm going to go out and build the first exchange. I'm going to roll up the companies, wire them together, cryptotize them and go nuts and build an exchange. I mean how did you get here? What's the story? >> Thank you well, it's a story. I began entrepreneurial projects over 10 years ago, been in the private sector, because Costa Rica is a services company we put together a call center. Took it from like four people to 4000 people in four years. I went on to like building my own sports brand in over 10 countries but then about two years ago a few companies from Canada they called me from here, they called me to help them go public in the Canadian Securities Exchange. I took two companies public last year and after that I was saying to myself and the crew guys what do we do next? How can we really disrupt the industry? And one of the things we were talking about was man, we're in a decentralized community that brags about decentralization, trading and centralized exchanges. How ironic is that? >> Yeah it's got to change. >> So we said you know what let's be the pioneers, let's head out on a quest to build the world's first mobile decentralized exchange and we achieved that. It's unbelievable. Now you hear all the big guys, the whales talking about we're going to come up with a decentralized exchange because that's what people want at the end of the day and we were able to be the first ones ever to give that. >> And stability is critical. I mean I was just at a bank starting up a new account for a new startup that we're doing and they're like is this a blockchain company? I'm like no, no God no, no, no we're a media business. >> Those are bad guys. >> So you can't even open a bank account some places. So this has really got to get fixed and I got liquid, I got fiat currency, I got to make movements around. The retail market, whether it's trading, investing, it's got to be converted over to the new world. >> Yes, yes. >> I mean it's almost like a full changeover. >> That's correct. Obviously I think that it'll be a transition process. It'll take some time. There are some banks that already getting more involved into the process. What's interesting in our case is we even got the Costa Rican Central Bank to be our bank. Think about it, we're not banking with any private bank or public bank but the Costa Rican Central Bank and I think that more and more banks will follow suit as they see good use cases. The ICO craze of last year, I don't think that it did any good to the greater good of the community. If anything it brought a lot of prejudice. >> It's a black eye. They'll be a hangover on that but that's like the dotcom bubble. All those things on the dotcom bubble actually happened so I think you're going to just see get that jested out of the system. >> Inevitable. >> And focus on quality. That's what happening now. >> Inevitable. >> Pablo thanks for coming on. Pablo Gonzales who is the Founder and CEO of Genesis Blockchain Technologies. First ever exchange bringing all new magic to the marketplace. This is The Cube bringing you the content magic here in Toronto, Canada. I'll be right back with more. Stay with us. Live coverage after this short break. (electronic music)

(techy music) >> Live from Toronto, Canada, it's theCUBE covering Blockchain Futurist Conference 2018, brought to you by theCUBE. (techy music) >> Well, welcome back to theCUBE, we're live here in Toronto for the Untraceable Blockchain Futurist Conference for two days of wall-to-wall coverage. I'm John Furrier, my co-host Dave Vellante, who had to take a step away and our next guest is David Johnston, who's the chairman of the board at Factom, industry legend, he's done a lot of great work from startups, he funds it in early days, really was involved in the original decentralized application framework and part of that community. Great to have you on theCUBE, thanks for spending the time with us. >> It's good to be here. >> So, first of all we are believers, theCUBE, our team, we're pretty biased. We think that decentralized applications is going to be the next really renaissance in software and startups because it's not your grandfather's venture capital or app SAS model, there's a real change going on. Capital formation, entrepreneurial activity-- >> Yep. >> So, congratulations for putting that together. What's going on, what's the status of this? I mean, obviously put all the price crashes on the side, there's real building going on. >> Well, it's really actually an exciting time. A lot of of good projects have started the last few years and I think what we're going to see is those projects come to fruition later this year, early next. I think about what's happening with groups like PolyMath and what they're doing on tokenizing securities. It really started that wave last year, and now we've got Bank to the Future, and what's going on in Malta with the legislation. A lot of jurisdictions are looking to basically embrace that model of okay, if you have a company, now we can turn that equity into a record on the blockchain and really give people global ledger where we can then trade it on multiple exchanges. It gets you global access, global liquidity, and all of these advantages, so I see a stampede of projects headed towards that model, but thinking about decentralized applications, what I want to preserve is still the permission-less nature of this ecosystem. I mean, I wasn't a rich investor when I got into bitcoin in 2012, all right. I was lucky to be an economics nerd and already wanted to get rid of my Fiat and opt into non-government currency, and so, you know, the timing was great for me but there weren't any barriers. I could download a node-- >> Yeah. >> I could access the ecosystem, I could jump right in and get involved, and so as we see the ecosystem mature what I hope we see is preserving that permission-less nature and recently I proposed Smartdrops as a means of distributing tokens and utilities or currencies-- >> Yeah. >> As a way of bootstrapping the network. So, that's what I really see coming next. >> Love the Smartdrop concept because you know, with Smart contracts and Airdrops kind of being wishy-washy, you know what goes on there, I think one of the things I want to get your thoughts on, because we were at the cloud blockchain event yesterday. Cloud computing and cloud-native chain, SAS applications, you start to see operators now be involved in cloud as that matures, what decentralized applications bring kind of changes the game a bit. How do you see software development changing, because what cloud did was create devops culture, it certainly leverages opensource. >> Right. >> And there's a big community around that. Now with decentralized application you've got community as an active part of it, so is opensource, how is it going to change the software development frameworks? >> Well, I think you can cut out a lot of the middle steps and go directly to developers that you want to work with. I mean, I think Ethereum really still set the gold standard when they set aside a chunk of ether for developers that contributed code to their GitHub before launch, and people will forget now it was a heavy lift to get Ethereum launched. It took a good year and a half, two years, to go from a whitepaper to production net deployments and in that time they needed to align people, the smartest people in the world to try to build that platform, and so I think people can still draw from that lesson and say, "Okay, I'm going to enroll developers directly, "I'm going to reward the people that download "the alpha, download the beta," right. Bootstrap this community to my first 1,000, first 10,000 users. I think PolyMath did that really well recently with their Airdrop where they got 50,000 people into a telegram channel and fill out a survey and do the KYC because they didn't make it a rounding error, they made it a meaningful Airdrop of hundreds of dollars worth of Poly at the time, and that really motivated people to get involved, so-- >> Yeah, and I like the slogan, "Let the stampede begin." (laughs) Actually, we covered PolyMath at their PolyCon event-- >> Sure. >> That Tracy and Untraceable did, and this is, again, the new dynamic. So, I want to get your thoughts on economics, right. So, you've got crypto, which is token economics, which is a business concept when you think about a new way. Blockchain's certainly becoming an infrastructure. >> Right. >> Token economics is changing the business landscape, so you saw it as an economics nerd and now people are realizing, "Holy shit, "I can actually do things with it differently. "I can change the equation"-- >> Right. >> "And still get the outcomes I want "faster, cheaper, smarter, of something "that's not efficient," this is a new dynamic. How do you see the token economics evolving, you know, aside all the liquidity nonsense we're seeing in the market, certainly fluctuations are happening. >> Sure. >> But from a build-out standpoint, from a business model innovation, where is the action on token economics? >> Well, I loved when the Vitala coined the term token economics, and you know, crypto-economics, and basically what he was describing is we're using math to screw the past and we're aligning people's economic incentives to secure the future. So, that idea that we can rely on encryption to give us a stable, immutable, transparent ledger is really powerful because it takes away, in a cloud context, the need to create a bunch of infrastructure. Right, before the cloud people had their own servers. >> Yeah, provision them. >> Dot com days, right, they spent millions of dollars provisioning their own hardware-- >> Before they could roll out their app. >> Right, and so we take it for granted today. >> Yeah. >> You can jump on AWS or Rockspace-- >> Yeah. >> And get going in a few minutes. So, I think blockchain is going to do something similar for all the features of Smart contracts, financial integrations around transfer of money, all of these things are now a toolkit that as soon as I hook into Ethereum or Bitcoin Cash or one of these protocols I have this large, established infrastructure, thousands of people running nodes that I don't have to pay for-- >> Yeah. >> As a user, and that's amazing for innovation because it just lowers the barrier-- >> Yeah. >> For the average guy to get involved. >> And accelerates time to value big time. >> Yeah. >> All right, so what was your talk here at the show, what were you speaking about, you had a discussion, what was the speech about? >> Really focused on this idea of Smartdrops because I think, you know, this can be a primer-- >> Explain Smartdrops real quick. >> Sure, sure, so most people are probably familiar with Airdrops. >> Yep. >> Been around for years, hey, you want to give 100,000 users of bitcoin some of your new token. We're going to send it out to all their addresses. It's sort of like a spray and pray strategy, very broad, right? >> Yeah. >> And so what I think we need to move to now that we have 50 million people with cryptowallets is we can much more intelligently target who we're dropping to, hence Smartdrop. Right, really focus in on the people that the app needs. If you're at the development stage you want to develop, you want to Airdrop to 1,000 Ethereum developers-- >> Yeah. >> To test out your app, if you're going into your alpha you need those early adopters to try it out, give you feedback. So, it's a thing that I think we could leverage but people have treated it as sort of an afterthought. Right, oh, I'll take one percent of my tokens and do one of these Airdrops. I think we could actually be distributing 20%, 40%, 60% of tokens via Smartdrops if you're properly targeting them and traunching it out based on the maturity of the projects. >> Yeah, and I think Smart contracts, Smartdrops really add value because it brings intelligence-- >> Right. >> To and targeting and more value you can distribute. It's like policy-based distribution. >> Right. >> All right, final question for you, state of the union, obviously people seeing these fluctuations, Ethereum lost its one-year value, it's back down to where it was a year ago. Largest developer community, people get nervous when you have these short term fluctuations that really aren't based on anything from a build-out standpoint. >> Sure. >> It's really more of market dynamics, Asia, wherever, whatever-- >> Right. >> But this real build is in the developer community going on that are building long term, trying to build long term ventures. >> Right. >> What do you say to that community at Ethereum and others, stay the course, don't waver, don't check the price, head down, grind it, what do you say? >> What I say is think long term. We've been through this like four times already. I remember when bitcoin went from almost nothing to $30 and crashed to $2, right, and it took almost a year-- >> Yeah. >> To recover, 2012, get back to 10 bucks, and then it made it's big run 2013 to $250, and proceeded to crash to $50. >> Yeah. >> Right, and then make a big run thereafter to the thousands-- >> Yeah. >> And crash to $200, and here we've made enormous runs and $19,000, you know, on the bitcoin price and it's crashed to $6,000 or $5,000, whatever it is today, and so you got to keep in mind the long term perspective. We have come so far. >> (laughs) Yeah. >> Like when I got into bitcoin in 2012 it was $10 a bitcoin, there were 10 million bitcoins in circulation, meaning $100 million was the entire digital currency universe, and now today there are hundreds of billions of dollars-- >> Yeah. >> Of assets in this space, and it's only been five or six years. Like it's orders of magnitude, so I keep my eye on usage, on real utility. You look at Ethereum, I mean, they're doing seven, eight, 900,000 transactions a day. People are using-- >> Yeah. >> The platform and I think at this point they've got more usage than all of their blockchains combined. >> Yeah. >> And so, you know, that's really exciting and I think keep your head down, keep building, these are the times when sort of like the fluff falls away-- >> Yep. >> And the projects that didn't make sense, all that gets flushed out of the ecosystem and the real projects come to the forefront. >> Well, David you're having a great career so far. Congratulations on getting in early when it was 10 bucks, and we had our first website developer was so good but he wanted to be paid in bitcoin in 2011, it was 22 cents-- >> Wow. >> At the time, I remember buying it, it was like, "What's bitcoin, what is this craziness?" (laughs) We started covering it then, just started doing videos, so we're going to do more interviews. We'll hopefully get you on again. Real quick, final plug for you, what are you working on right now? Share with the community some of the projects and your interests right now and what's going on. >> Well, Factom is a big focus for me because this solves data on the blockchain and lets you do recordkeeping, documentation, all that sort of stuff, and so that's really hit a chord with enterprise, so we need to get the mainstream into the ecosystem and that's really what Factom is focused on. >> Yeah. >> So, really excited, they've delivered their third version of their software, which is now fully decentralized recently. >> Yeah. >> It's a huge milestone for them. >> So, harden it, make it reliable, stable, and make it easy to consume and use. >> That's right, that's the key. >> That's the goal. >> And let people put millions, billions, or trillions of records on, and what Factom does with Merkle trees, basically you only need one transaction every 10 minutes to anchor all of that data. So, what we've created is scalability, and that's what we need for this to go mainstream. >> All right, David Johnston, chairman of the board at Factom here on theCUBE, industry insider, pioneer, also leader, inspiration. theCUBE bringing you all the live action, all the data here not yet on the blockchain, soon to be. I'm John Furrier, live coverage here in Untraceable's event Futurist event here in Toronto, be back with more. Stay with us, be right back with more content after this short break. (techy music)

>> Live from Toronto, Canada, it's theCUBE. Covering Blockchain Futurist Conference 2018. Brought to you by theCUBE. >> Hello, everyone. Welcome back. This is theCUBE's live coverage here in Toronto, for the Untraceable event. Here in the industry, it's called Blockchain Futurist. It's where all the industry elite are getting together here in Canada, to talk about the future of blockchain, crypto, and everything. It's theCUBE's specific coverage. As we continue 2018, kicking off event coverage with our CUBE brand. But right now we've got two great guests from Start-up, and they're called Quantum EXchange and Bank, QuantEXchange. Manie Eagar, Executive Chairman. And, John Willock, who's the CEO. Guys, welcome to theCUBE. >> Thank you. >> Thank you. >> So you guys got some hard news to talk about. >> We do. >> But, you guys are doing an exchange model, bringing something really cool to the market. >> Yep. >> Which, we need to kind of get this figured out. Take a minute to explain what you guys are doing, the problem you're solving, and then we'll get to the news. Absolutely. So, I think the lot of people are doing exchanges. You see them coming all the time, and most of them don't really have any specific differentiation or value add. We are not like that at all. We have spent our careers as part of most of the team, in traditional financial services. And, we're coming from the securities exchange business to bring the learnings from NASDAQ, the learnings from the like of that sort to the Crypto Exchange space. And, to be able to facilitate not only a regulated exchange venue, but also one that is institutional grade in terms of tools and the client experience, as well as the trust factor with the platform itself. So, that's really what we're trying to get done with the Quantum Exchange that we're building right now. >> And how old's the company? How long you been around? When do you guys start? How funded are you? What's happening there? >> So, I'll refrain from discussing funding at this point. But, I will say we've started this year. I left the Toronto Stock Exchange specifically to pursue this in conjunction with Manny. And, we've been batting this idea around for the last couple of years. And, the market reached the stage in maturity and size, that we said now is the time to get going and do it. And, so far, fanfare has been fantastic. Reactions from people in the Crypto Ecosystem, people in the Securities Ecosystem, has been equally positive. >> Yeah. >> There's a strong desire to see something like this come to market. And, we're very excited to be able to launch. >> Before we get to the news, Manie, I want to ask you a question. One of the things that we've seen is two types of behavior. The other guy's got to lose for me to win, and then, or both parties can win. We're seeing trends where people are taking a posture against regulations. Oh, they're evil, they're causing all the problems. They kind of don't know what they're doing, kind of, they're evolving. Maturity levels are different based on countries. But, where the success is happening, like Gabriel with Bit. Okay, there's collaboration. Because the regulars actually want to do a good job most cases. They just can't get there fast enough. This is the new model. This is what people are looking at. This is the kind of solution ... >> Absolutely. >> A bridge between industry, and the slow but, yet want to change regulators. Your thoughts? >> Very, very good point. The good news is we're all talking to each other. I think there's dialogue at the moment, but it's not maybe as open as it should be. Because it's all day one. What I bring to the community, and have for the ... since I got engaged in launching the first Bitcoin ATM in the world, in Vancouver, part of that team. And, I think Anthony Bold from Bit is for an alliance. And, blockchain association in the block forum, which we'll announce tomorrow. 'Cause I worked for Blockhouse. I worked for Vodafone. I was involved in the Empasa project. And, I can see and understand what does it take for people to start using technologies. I think what everybody is hoping for is this golden moment. Like when the first iPhone arrived on the scene. >> Yeah. >> People queued around the block through the night to get ahold of that first device. We haven't had that moment yet. For Blockchain and Crypto. We've had the wild enthusiasm, which is all speculation as far as most of us are concerned. But, maturity is coming, these technology if Blockchain and Cryptocurrencies want to succeed, there needs to be another converging technology with what's already out there. The internet, your financial ecosystem, and so forth. >> Yep. >> In my view, there'll be a coming together. There'll be new models altogether. Incumbents will have to pick up the pace in terms of how they go about it. >> Yeah. >> But, we see the opportunity for ourselves, for Quantex. And the industry as a whole is where the convergence takes place, the dialogue becomes more mature, and open, and transparent. Regulators become aligned. At the moment, we hear of a lot of jurisdictions announcing this, announcing that. But, when you start investigating or assessing, it's different flavors, different cultures, different economies. >> Yeah. >> There's the Commonwealth Block. There's the North American Block. There's the Asian Block. Europe is a whole different ball of wax. >> Yeah, I agree with you and I just want to ... >> So, this is where it gets interesting . That's where we come into the boat. >> Absolutely. >> Well, I agree with you, I just want to make a point. During the dotcom bubble, during that internet wave, there was some over-speculation. But at the end of the day, the forcing function of reality was the growth of the online users was growing every day. >> Yeah, yeah. >> And, the demand and the commerce dollars were still real. Now, certainly there was an exuberance. Irrational, in some cases. But, it all ended up happening. I think here in this market, the forcing function is the reality that there's demand, and there's money, and there's impact. >> There is now, we now know that. >> This is coming. It's not like Doomsday. Well, it was fake. No, not really. >> No, we are still in the first inning of seeing what is actually coming out of all of this. I think last year's price speculation runoff obviously was set to decline at some point. But, there has been a long series of momentum coming out of that, where people have realized that this is something much more important and significant than what it looked like three years ago, perhaps. And, a lot of that talent is now coming to this space. Bringing, the capital, bringing the know-how, us included, to deliver something for the next generation of platform, tools, and ecosystem to really grow this massively. And, bring it much more to the mainstream. >> And, I think the idea of aligning with regulars, help them move faster. You mentioned adopt technology, but, still in the phase of deploying operational infrastructure. You mentioned some of the things, the projects you've worked on. Vodafone, that's cellular, that's towers, that's infrastructure. So, I think we're still in this hybrid model of, in parallel, capital formation, building companies, and then, just, we got to get the roads built. >> Well, and understand the posture that a lot of people are taking on. We need to decentralize, we need to open this thing up. But, at the end of the day, the consumer votes. You and I know if we don't have viewers, we don't have a channel. If we don't have users, people actually using the technology, not only investing, but actually using it. It aint going to happen. Decentralize, centralize to a hybrid. And, that's the part that we need to open ourselves. >> Let me ask you guys a question before we get to the news. This exciting news you get to share. How do you standardize something? Because, one common thread of all these major deflection points, at least, with the major cycles I've lived through, has been standards. >> Absolutely. But, it's not going to be your grandfather's standards.So, TCPIP was different. The OSI model is a different generation. The internet was different. Web social is different. What may happen may be different. So, but, standards play an important role. But, no one has clear visibility yet what will be standardized, what should be standardized. Do you guys have any thoughts on that? >> Well last year John comes in, and he's learned the world of standards at NASDAQ, and TMX, and elsewhere. >> That's true. >> Now, we need to bring it to this world. >> How do we scale operational lead to get a cohesive exchange that can scale and demure value? Where do the standards focus need to be? What should the emphasis ... where does the light get shined on, and where's the energy go to? >> I think, you know, you want to look at standards, think about something like this ETF debate that's been going on. Huge speculation about whether or not that's coming. I think a lot of people who are looking at that ETF debate, specifically, don't actually understand some of the economics and the mechanisms behind the scenes. So, for example, what is a fork? When you think about traditional securities, you got corporate actions like a stock split or dividend. A fork is an entirely different concept with entirely different results. Those are the sorts of things that need to be discussed, standardized, and brought to an industry cohesion to be able to successfully deal with some of these events as the market progresses. And, to bring some normalcy to some of this as well, especially if you want to bring institutions to the plate. And, I think that comes to one of the other initiatives that we're working on ... Which is the industry body, called block forum, which we're going to be discussing in a moment. That can really help be that joining voice >> Hold on, hold on a second. This is the news. >> behind everything. >> This is the news. You guys are announcing, let's get to the news. >> Okay. >> You're announcing a couple things. Start with what you were just talking about. You guys are announcing a forum. Can you explain? >> Correct, correct. So, we're launching, officially, to the remainder of the crowd here tomorrow, block forum. Which is an industry association that will be especially behind driving adult thinking behind all this, putting regulation into place, discussing commonalities around policy, around how to standardize, and how to really make all of this interoperable. And, I think that's the key word. If you have individual pillars of, islands of activity, that's not going to be the same as having a cohesive global solution. And, that's what we really want to drive. >> An exchange solution? >> Well, in our case in Quantex, absolutely. But, an exchange in the services we can offer is one part of the whole puzzle. There's a whole series of inter-connected affairs that have to work together. And, that's what block forum is going to drive, is this assembly of different connected parties who are all working for the greater benefit of the Prio ecosystem. >> Who is going to be involved in the forum? Who is the stakeholders? Who can join? Is it a membership? Is it a consortium? >> It is a membership. There will actually be a token that will have very interesting membership related tokenomics attached that we can disclose at a later date. And, that economic alignment between the parties who are staking effectively their interests in the certain topics that they want back or the certain efforts will be a completely unique model compared to what we've seen in the industry today, where generally speaking, it is a committee who drives something on behalf of members. This is really fundamental for all members, democratically from individuals all the way up to institutions, to be able to participate and voice their interests. >> So you will see governments as members. >> Yes, yes, absolutely. >> You will see industry leading stakeholders and practitioners. The whole idea of the body is not to create new policy or reinvent the wheel. We're getting policy, we're receiving regulation. So, how do we put this in practice? Where are the success stories? How can we show the industry as a whole? Governments across jurisdictions to align around their spacing. >> So a melting pot of people to get a conversation going. >> Right. >> To start shaping an agenda or just start talking? >> So, we're talking to governments at premier and cabinet level. We're talking to boardrooms of banks. We're talking to think of your top 40 leaders in blockchain and crypto. We're talking to all of them and engaging with them. >> And, what's the vision of the outcome that you can envision in your mind? What is that outcome for this group? What do you hope to accomplish? What is the end result, if you can kind of assume things go in a good way, what happens? >> I think this is a unifying voice for leadership in the industry to discuss what the outside, outside of crypto world that is, and really bridge that gap between those who are within and understand natively and those who need to be brought in to be able to interact with this and really grow all of this industry. >> And, promote the role models. >> And, exactly that. Exactly that. To bring the best to the front. And, really show that there is actually serious opportunity, serious business. This is not just a series of hackers or whatever nefarious activity these people casually may think the block chain industry is. This is something very serious and very real. And, we want to be a voice for that. >> Awesome. And, you guys had some other news on the fundraising front. >> Industry first. >> You guys are raising some money, you're doing a private sale, and new gear as much as you can, it's pretty invested, so, I think you can promote it. >> I will say with a caveat as you say, it's pertinent to investors only, and we have not completed our discussions with our legal counsel. Having said that, we are taking the model of a traditional securities exchange membership, seats on an exchange, which can be purchased, which have rights attached, which are a titled asset separately from equity of the exchange, for example, separately from a utility token as you would have seen with many other exchanges. This is something that we feel is a very unique model. We are very excited to be able to launch this, and come to market first with this concept. Which again, is blending the best of the old and new. We're taking tokenization, we're taking a concept that have existed in the previous markets and previous worlds, and blending them together for something that is somewhat unique and wholly new in this application. >> Well, I hope you guys raise a lot of money. We need more harmony between regulating and government entities to bring the whole world together. And, certainly from the money-making standpoint, what the liquidity and exchanges can provide as the world starts to understand where the groove swing is and where those swim lanes are, especially with security tokens. >> You bet, you bet. And, the success is going to be measured in ability to scale sustainably. And, we want to demonstrate that with this model. >> We need some leadership there. So, good luck. Best of luck. >> Thank you very much. >> Thank you, thank you. >> We are here live in Toronto, Canada for the Blockchain Futurists Conference. I'm John Furrier with theCUBE. Describing the single millers, talking to the most important people, the hottest stories. Here are the most colorful people, people traveling around the world sharing that insights with you. Stay with us for more day coverage here. The first day of two day coverage of Blockchain Futurists. We'll be right back after this short break.

>> Live from Toronto, Canada, it's theCUBE, covering Global Cloud and Blockchain Summit 2018. Brought to you by theCUBE. >> Hello everyone, welcome to the live coverage here in Toronto for the Global Cloud and Blockchain Summit here put on as prior to the big event this week called the Futurist Conference. TheCUBE will be here all week with live coverage. I'm John Furrier with Dave Vellante as we expand our coverage with theCUBE into the blockchain and crypto token economics world. We're here on the ground. We're covering the best events. We started in 2018 initiating CUBE coverage on the sector. Of course we've been covering Bitcoin and blockchain going back to 2011 on SiliconANGLE.com. Dave, we're here to kick off what is the first inaugural event of its kind, combining cloud computing coverage with blockchain, and as we had on our fireside chat last night, we discussed this in detail. Cloud computing and blockchain, either going to be a collision course or it's going to be a nice integration. And we discussed that. This is what this show is all about, is it's really about connecting the dots to the future. The role that cloud computing will play with blockchain and token economics, a variety of different perspectives, but again, this is the first time we in the industry are starting to unpack the mega-trend of cloud computing, which we know is like a freight train powering and disrupting, and we cover it in detail. But blockchain is certainly transforming and reimagining business and process coming together. >> Well, we're here in Toronto, which of course is the birthplace of Ethereum, and it's interesting to see how Toronto has attracted so many developers in the software and engineering space, and there's a huge crypto community here. I'll give you my take on the cloud and blockchain. I don't see them on a collision course. I see blockchain, and we've talked about this, and crypto as a part of this other layer that's emerging. You had the internet, you had the web. On top of that you had cloud, mobile, social, big data, and it was essentially a cloud of remote services. What we're seeing now is this ubiquitous set of digital services of which blockchain is one. And to me it's all about automation, machine intelligence, blockchain being able to do things without middle man. You made that point last night on the fireside chat. And I think it's complementary. You need cloud for scale. Everything's digital, which means data. And you need machine intelligence for automation. And that is the new era that we're entering, and blockchain is playing a big part of that because of its inherent encryption, its immutability, and its ability to show proof of work. So it's a key component of a number of different digital services that are going to transform virtually every industry. >> Certainly, then, that's a tailwind for the industry, and certainly we see that. All the alpha entrepreneurs, alpha geeks, and a lot of the business pros see blockchain and token economics as a dynamic that will certainly change things. Today in Toronto this week, certainly not a good week for pricing of currencies. The crypto market is down, Ethereum and Ripple are at yearly lows. And communities are kind of getting scared. We talked with Matt Roszak, an early investor and founder of BloQ, last night about the price declines, and he said, "I've seen this pattern before. "These price selloffs also kick off "the next wave of growth." So there's a kind of a weeding out, was his perspective. But you can't deny that over the past 24 hours, 30 billion has been erased from the crypto market caps, and the greatest decline is happening under Bitcoin's dominance, and still increased over, still 56% over the year. So Bitcoin seems to be holding more value than, say, Ethereum. Ethereum and Ripple really under a lot of pressure. So the insiders, some are scared, some are like, hey, we've seen this movie before. Waves are a little bit rough right now, but they're in for the long game. So this is a long game going on and then there's also money being lost. >> Well, Matt was saying bet the farm now. He said he's seen this before. Take everything, the mortgage, the house. I'm not sure I would advise doing that, but this is the time, buy low. So just for the numbers, Bitcoin's high last November/December was 19,000, it's down at 6,000 now. So as you say, it's still up almost 50% for the year, but if you compress that timeframe to nine months, it's down 60%, so very, very volatile. Ethereum, on the other hand, last September was trading at around 240, 250, and today it's in the 260s. So back to where it was last September. The curve on Ethereum sort of looks like it did end of last summer, whereas Bitcoin is still almost 70% up from where it was last September. So quite a bit of difference between the two cryptocurrencies. And you mentioned Ripple, IOTA, many of the cryptocurrencies-- >> Ripple's dropping 90% from its 2018 highs. 90%. (both laugh) Some money was made and lost on that one, so again, we always say when the music stops you better be sitting in a chair. Otherwise this is bubble behavior, but you know Matt and others and the insiders are saying they're still bullish because of the pattern. Even though it's a selloff, it's a weeding out process and they see still good deals going on. And again, this is going to come fundamentally down to whose technology's going to be adopted, what kind of application can be written on blockchain, which is seeing some promise in the enterprise. Just yesterday Microsoft announced a blockchain as a service kind of thing with proof of authority and new concepts. IBM, we've been covering IBM with blockchain, their work with the Hyperledger standards. You've got the enterprises. Amazon has kind of telegraphed, they actually put a professional service note out where they are doing some blockchain. The big clouds are getting into the game, so the question is, will the clouds suck all the oxygen out of the blockchain room, and will there be room for other blockchains? Again, this is the big debate. Is it going to be a fragmentation of a series of blockchains, or will there be some sort of set of standards? Again, we don't know what the stack's going to look like because the best thing about blockchain is you could roll it out and implement a portion of the stack and still coexist with whatever standards emerge. So again, these are the questions. >> Well, one of the conversations that of course is going on is actually, the number of transactions that's occurring with Bitcoin is way down, it's probably down 20% year to date. The other conversation is we all know that Bitcoin and Ethereum, the transaction volumes can't really support what we do with Visa or even Amazon. There's a discussion in the industry going around about what if Amazon shows some other coin? Like Ripple, for example, which has much higher transaction volumes. Or what if Amazon tokenized its own business, came up its own cryptocurrency? What would that do to the price of Bitcoin, if all of a sudden you could transact in Prime using AmazonCoin or something like that? And we know that Amazon understands how to scale, it obviously understands cloud. That's why I do see cloud and blockchain as complementary. It's very difficult to predict the future. There are those who say Bitcoin is the standard, it's got the brand. There are those who say that Ethereum, because it's much more flexible and you can program distributed apps with it, have a great future. And then everybody points to the transaction volumes and says, this is just a Petri dish for the future where new technologies will emerge that scale better and can produce. >> What's interesting last night on the, we had a fireside chat with Al Burgio, serial entrepreneur, founder of DigitalBits, and Matt Roszak, obviously founder of BloQ and investor, he's on the Forbes billionaire list, super active, very engaged on a lot of advisors, Binance is one and many other deals he's done, it's interesting, you got two perspectives. Al is the networking guy who knows plumbing, knows how networks work, and Matt's a token economics genius. So the two have interesting perspectives and the battle royal going on right now, in my opinion, is two things. I think token economics is a wonderful thing that's going to happen no matter what the standards are, 'cause token economics really is the value to me of the cryptocurrency that can be applied to new business models and efficiencies. The blockchain is a land grab, and here's why. I think whoever can nail the plumbing and the pipes of the infrastructure reminds me of the early days of the dial-up web, when you had points of presence and you had the infrastructure had to be laid down. Although slow, people can dial up and get the internet, then obviously the internet got faster and faster. Blockchain's struggling from that scalability performance issues, and so the question is, on a public blockchain, you got to have the supernodes, you got to have the core infrastructure plumbing nailed. I think Al Burgio takes that perspective. Then everything else just will flourish from there. So the question is, what do those hurdles look like? And this is where the cloud guys could either be an enabler or they could be a foe against the core community. Like you said, Amazon could just snap their fingers tomorrow and take out the entire industry with one move. Just, we're going to do our own blockchain as a service. Everyone uses it, here's our token, and then a set of sub-tokens would have to be coexisting with that. And that could be a good thing, we don't know. This is the discussion. >> And governments around the world could do the same. US government could do Fedcoin, the Chinese government could do Chinacoin. I mean, what would that do to the prices of cryptocurrencies? I mean, it would send it into a tailspin, you would presume. And it was interesting. Matt Roszak on your panel last night, I asked the question, well, traditional banks lose control of the payment systems. And granted, he's biased, and he was definitive. Yes, absolutely. But the counterargument to that, John, and I'd love your thoughts on this, is the US government and the banks have a lot to lose. And they're kind in bed together and always have been. So one would think, with the backing of the US, its might, its military, et cetera, that they're not just going to let the banks lose control. Now, to his point is, why do you need to pay transaction fees to a bank? But you're paying transaction fees to somebody, even in crypto. >> I think our government in the United States is really asleep at the wheel on this one. And here's why. One of the beautiful things about the internet was it was started through collaboration in the universities in the United States. The United States enabled the internet to happen, and the Department of Commerce managed it. The Domain Name System was managed in a very community-oriented way. Again, community, keyword. As opposed to all this, that history is well-documented. If people aren't familiar with the history of the Domain Name System, DNS, go check out the Wikipedia, research it. It was run by a bunch of people who managed the database of website names. And that became sacred and was distributed. >> And funded by the US government. >> Funded by the US government, but the community managed it. The problem with the US government today is that they are meddling in areas that they actually shouldn't be even playing in. You got the SEC, it's shutting down everything right now just by the threat of subpoenas in the ICO market, which puts the overall country into a handicapped position, because now the innovation of blockchain and the entrepreneurial innovation that's happening is stunted, and it's just shifting outside the United States. So what's happening is the money flow and the energy and the activity is so high that incubation's not happening in the United States, although a lot of people are working on it. There's no funding mechanism. The capital formation of blockchain's different than venture. It's not super different, but somewhat different, but it's happening outside the United States. Certainly the Chinese will be in benefit of this. And if the Chinese wanted to shut down blockchain they would have done it by now. They're actually fostering it, and it's an opportunity for someone on the international stage to get a lever in the United States. So that's one. The second thing is they can enable crypto if they wanted to and I think they really should look at that and I think the banks are central organizations, the World Bank, they're under a lot of pressure. They don't know what to do. So when I talk to people, that's the same answer in so many words, is the government and the regulators really just don't know what to do. >> Well, and Matt made the point last night, Matt Roszak, that when he talks to these banks they're talking about using blockchain and they're very excited because they're going to take hundreds of millions of dollars of cost out of their, you know, infrastructure and their processes that are just not very efficient, and that's going to drop right to the bottom line. And of course they're in the money business, so that gets them very excited. His point was that's really not what it's about. Yeah, that's nice, but it's really about transforming the businesses, and that's why I asked the question about banks losing control of the payment systems. Opens up a whole new opportunities, whether it's financial services, healthcare, automotive. And again, to me, it comes back to digital, which is data, plus machine intelligence plus cloud for scale. You called it. I think at IBM Think, you coined it the innovation sandwich. Data plus machine intelligence plus cloud for scale. Put that together, that is the innovation engine for the next decade plus. >> The innovation sandwich, unlike a wish sandwich, where you wish you had some meat in the middle. You know, this is a good point. Let's end this kickoff and get into some of the interviews here with these really early thought leaders in this new conference. This is the first of its kind, cloud and blockchain, and we're going to certainly continue this in Silicon Valley with theCUBE summit coming up and our events that we do. But let's get some predictions out, because remember, this is theCUBE. Everything's going to be out there, it's going to be on the record, so we can look back and say, hey Dave, remember in 2018 when I asked you what's going to happen? So let's get into a prediction. What do you think's going to happen? I'll start and you can think up an answer. So here's my prediction on this whole blockchain world. Not so much crypto or token economics. It's really two predictions. With respect to blockchain, I think you're going to see an exact movement that the cloud market took, and I think it's going to happen in three phases. Phase one is all the energy's going to go into public blockchain, and public blockchain will be figured out first, and people are going to get excited by the new operation models of blockchain, specifically the decentralization of how that works and the benefits of decentralized blockchain, immutability, no central authority, and all the benefits of blockchain. I think it's going to be very rapid growth in the fixing of blockchain. Speed, scale, that's going to happen very quickly. And it's going to happen publicly. Then you're going to see private blockchains. You're going to see on premises kind of like blockchain. Kind of like the cloud, people have onsite, private. And then you're going to see a hybrid. The hybrid will look like multi-chain solutions. This is almost an exact trajectory that cloud computing took, because blockchain feels like a cousin of cloud or a brother or a sister. So it's related, but not exactly, but I think it's kind of the same trajectory. Public, private, hybrid, which is a multi-chain model, and I think that's going to be the standards. That's going to be the market track. On the token side, I think you're going to see a couple key tokens, like certainly Bitcoin's not going away. I'd be doubling down on Bitcoin under 6,000, like everything on that. That should hit 20,000, in my opinion, over the next timeframe. But there's going to be a lot of token integrations. My token integrates with your token and almost natives and secondary tokens kind of blending together where people with coexist tokens on one platform. So it's just too powerful not to have that happen. So that's my prediction. What do you think? >> I think as it relates to blockchain, I think blockchain becomes, in the enterprise I think it becomes an invisible component of virtually every industry. 'Cause every industry has waste, can improve efficiencies, and blockchain becomes a way to, whether it's supply chain or settlements or shared ledgers, I mean, there's dozens of applications for them and I think blockchain becomes a fundamental component of a digital infrastructure, and it's starting now and I think it's here to stay for many decades and beyond. And you won't even see it. It's just going to be there. It's going to become a fundamental part of how we do business. On the token side, very interesting, obviously, hard to predict. I think that you're going to see continued volatility, of course, I think that's a safe bet. But I also think it's potentially going to get worse before it gets better. I think there's going to be a shakeout. I think you're going to see, there continues to be pump and dump scams going on, the US government's getting more aggressive, a bunch of subpoenas went out, and people are still trying to understand what that all means. So I think it's going to be rocky roads for a while. I think you're going to see a big shakeout, like a big dip, and then I think it's going to power back. I think the crypto is here to stay. And it's very, very hard to time these markets, so my advice is just buy, trickle buys on the way down and hold. HODL, as they say in this world. And I think 10 years from now it's going to be worth a lot. >> Alright, you got it here, theCUBE. We are in Toronto for the first inaugural Global Cloud and Blockchain Summit. Of course, part of the big event here in Toronto, Futurist Conference, which we'll be there live. Wednesday and Thursday, the kickoff is Tuesday night for the opening reception. It's theCUBE coverage continuing for blockchain and crypto markets. I'm John Furrier with Dave Vellante. Stay with us for more live coverage here in Toronto.

(upbeat music) >> Live from Toronto, Canada, it's theCUBE. Covering Global Cloud and Blockchain Summit 2018. Brought to you by theCUBE. >> Hello everyone and welcome back to theCUBE's live coverage in Toronto for the Blockchain Cloud Summit, part of the Blockchain Futurist event happening tomorrow and Thursday here in Toronto. I'm John Furrier with Dave Vellante. We're here with Gabriel Abed who's the founder of Bitt and also the Digital Asset Fund. Great story he's been there from the beginning. President at creation in the movement that's now changing the world. Blockchain and cryptocurrency certainly. Infrastructure and token economics, changing how things are doing. And rolling out, reimagining everything from infrastructure to value exchanges. Gabriel welcome to theCUBE. >> Thank you it's great to be here. >> So we were just talking on camera, you like to go after the big changes. You're an entrepreneur, you have that fire in your belly. You've been very successful. Where are we? I mean, you've been part of the movement, we're now on the cusp of mainstream adoption, there's still work to do. >> Oh, plenty of work. Lots of infrastructure still to build, many regulators and legislators still to educate, lots of laws still to be amended and changed. And, at the end of the day, it's happening and it's happening quickly and beautifully right now. The entire industry is changing. >> One of the things that you've done, you've taken on some big projects and you've made change happen. Regulation is one of the hottest topics we're hearing certainly in the United States, it affects innovation and there's so much entrepreneurial activity happening right now. There's so many entrepreneurs, alpha entrepreneurs really want to do great things, and regulation is just a blocker. It's an antibody for innovation. And you've busted through that. And it's probably going to continue. The old guard is either going to be replaced or adapting to the technology. You've done that, and a lot of people want to do what you've done. What's the secret? What's the secret of your success? How have you taken on these big, incumbent positions and taken them over >> But you're not running from regulators, you're embracing them. >> No, no, I think regulators are important to a responsible and sophisticated market. When my partner and I started Bitt in 2013, 2014, we immediately realized that if we wanted to build a product for the monetary authorities around the world, we needed to have the buy-in from the regulators. So from day one we were regulator-friendly. And it's not to say that we don't believe in a decentralized future, I'm as big of an advocate for decentralization and the freedom of information as anyone else, but I'm also a big believer in if you're a product for a market in the traditional world you have to involve the regulators in order to ensure that product does its job, keeps the consumers safe, and ensures that the economy around it doesn't collapse. So regulators are critical in this field. >> Talk about what you guys have done. Take a minute to explain the project you did, how it worked out, the tenacity, but also, what was the outcome? What were you trying to do in the project and where is it right now? >> It depends on the project you're referring to >> Maybe start at the beginning >> The Caribbean >> Let's start at the beginning. >> Yeah, yeah. >> Okay, so, Gabriel Abed, born, raised, educated in Barbados, around the age of 19, I decided I was going to take my computer science education a bit further. I went to Canada, I did a Bachelor of IT, where I majored in network security. In Ontario, the University of Ontario. And, unlike the rest of of my peers, who usually stay in Canada, I decided to go back to my little nation with the education that I had just received. And I took that education home, and started one of the world's first blockchain companies, but at the time I didn't understand blockchain per se, I understood it as a commodity, as a cool investment, I didn't understand the true nature behind the protocol itself. It was only until 2013 that my partner and I ran one of the larger mining operations in the world, that we realized a commodity was actually a protocol. A network tool. A system that you could build on top of. So in 2014, we actually created one of the world's first blockchain assets, on Bitcoin's blockchain. And that a representation of a digital dollar for a central bank. And the notion behind Bitt.com in 2014 was, let's compete with cash, because it's inefficient, it's costly, and it slows down the movement of society. So what we wanted to do is create a digital version of that, that would save economies hundreds of millions of dollars. Cash is expensive to to create, that linen, plastic, paper money, it's easily forged, it can be counterfeited, it's hard to transport, it has an expense to transport, it has an expense to count, it has an expense to secure, and then it has overheads around the entire ecosystem of accountability. Whereas, a blockchain-based digital dollar eliminates all of those efficiencies, and increases the ability for a monetary authority to trace, track, and have a better form of anti-money laundering, counter-terrorism financing and a better overview of their entire society. So that all, we took that notion, went to the central bank of Barbados, who at the time was being led by Dr. DeLisle Worrell, and our very first meeting he had asked me to excuse his office. And 13 meetings later, and a whole two years, lots of development, building out infrastructure around compliance, around finance, around security, and around regulation, we finally got the nod of approval from Dr. DeLisle Worrell to operate a fiat example of a digital dollar in Barbados. And since then, we have been working with several central banks around the world, bitt.com today is the leading central bank provider for digital dollars. A lot has changed, I've developed other tools since, and other businesses, but bitt.com continues to be the best friend for central banks looking to move and transition into the digital arena. >> Why, I mean other than a closed mindset, why wouldn't every government around the world want to move in this direction? Initiate some kind of FedCoin, for example. >> Education, education, it's the fear that the system may not be scalable, it's the fear that the system could be hacked, it's the fear that they could be cut out, their control, at the end of the day, monetary authorities, like the Federal Reserve, they have a control on the money supply. Whereas, something like decentralized cryptographic currencies, there is nobody in control of the money supply. Hence, inflation versus deflation systems. Then there's the issue of hacking and the threat of digital and cybersecurity. Typically, the head of these monetary authorities are older gentlemen who are traditionally conservative. And who are not (mumbles) with cybersecurity. So the fear of hacking is very real for someone like them, whereas someone like me who is trained as a network security expert, those fears can be mitigated with good policy and procedure, cold wallets, and the right process, to ensuring the environment can run without the risk or the fear of malicious attacks. So it really boils down to education. The educated governors of central banks, like there's one, for example, Timothy Antoine. Dr. Antoine is the governor of the Eastern Caribbean Central Bank. And they govern and mandate the currency union of eight islands below them. St. Lucia, Grenada, Antigua, et cetera. Now, he's a governor that gets this and has wrapped his head around it, and understands that this is the future. He gets it so much that he signed an agreement with bitt.com to begin exploring a pilot for his currency union to have a digital dollar implemented in it. You also have governors and presidents like that of Curacao. Or the central bank of Curacao, where we've just signed an agreement to move forward with a phase of looking at the implications of rolling out a digital dollar in a society like Curacao and St. Maarten. What is the ramifications? What is the feasibility study behind that? So, to answer your question, it's not every single regulator, governor, and central bank manager is going to head toward this technology tomorrow. But with more education, and more lobbying, you will see more and more central bank governors moving in this direction, because it's better, cheaper, faster, makes their job easier, gives them more control, gives them more oversight, and provides all the things that they would want as a central bank to continue to do their job for their society. Which is to protect their dollar from alien threats. And to ensure that the dollar remains stable, and to just generally ensure that the society is functioning the way it should. >> Gabriel, what's your vision on what this will enable for the citizens? What's the impact that you see happening? If this continues down the trajectory, what is the adoption look like, impact to people's lives on a everyday basis. >> Well, for a very starting point, you democratize payment. Right now, if I want to make a payment, I have to go through a utility company called a bank. And this bank typically has frictional costs, and frictional overheads and time. That's one of the biggest problems, is that these monopolistic infrastructures hinder the ability for the average participation of a free-flowing payment system. So what you end up having is rather than me being able to make a digital payment in seconds, with no cost, I have to wait days, I have to use manual-based systems whether it's check, cash or the bank's Visa Mastercard system. And then it has frictional costs. So right off the bat, you democratize payment. What does that do for a society in a developing nation? It empowers people. And you're empowered because now as a developer, I can build on this payment system. As an entrepreneur, I can tap in to this payment system. As a merchant, I can utilize this low-cost payment system. As a society, I now have GDP growth because of financial inclusion. The underbanked, who do not have access to banking facilities for one reason or another, maybe they don't like the bank, maybe the banks don't like them. Maybe they don't have two proofs of ID. Maybe they don't have a fixed place of abode. Maybe they don't have the minimum deposit amount. All of these features keep the poor and the underbanked out of the system. Whereas, in developed nations, we have mobile penetration rates that are through the roof. In some cases, like Barbados, over 100 percent. So if you have 100 percent penetration rate of this mobile platform, this thing in my pocket, but I cannot access the banking system, well flip that around, democratize the payment system, allow payments to exist on this mobile phone, and watch how quickly society becomes banked. So what you end up having is full adoption. Why would we not have full adoption when it's cheaper, it's faster, it's more inclusive. >> And the data from that collective intelligence only creates a digital nation >> A more responsible environment. >> Wealth creation environment. >> It creates a more traced, tracked, and accountable society so that the monetary authorities in the government can now start making educated decisions on data. They now know who's buying milk, who's gambling, who's paying their taxes and who's not. >> The downstream benefits of this are massive. >> The downstream benefits are massive, enormous. They're disruptive. This is a brand new fiscal tool, a monetary tool, being given to central banks to start eroding the field of private e-money systems, and to start bringing about a uniform standard towards payments. Plain and simple. We're going to the central banks and introducing a new monetary instrument, that they're in control of. That now the commercial banks, the financial institutions, the corporatocracies, the citizens, and the merchants can all fall under one roof issued by their monetary authority. And this is not a cell phone company or a bank building their own private system that I have to jump through some hoops and some red tape and sign away my first born and give away my left arm to enter. This is a free and open source standard system. >> And it's networked, as you said, penetration is 100 percent on mobile or roughly that, it's a network society that now has digital fabric built into it. This is the future. >> But I played this out in terms of, when you talked about this in your panel, now every device, every thing, every physical asset will be instrumented. >> Yes. >> And as a result, theory can be coconuts. >> You're building the deep infrastructure. I remember we met with World Bank back in 2014 and they coined this term for me. Because they were saying we want to help entrepreneurs and it's important to help entrepreneurs in developing nations because they're the lifeblood of it. But what we are building is the deep infrastructure. And that's exactly what it is. It's the infrastructure that would allow the entrepreneur and the developer to now have a framework that they can build against to provide more uplift. So in essence, it's really going to be exponential growth once systems like this are implemented. The stock market can move digital, and people could buy stocks using digital dollars. E-commerce can occur because I can now buy things online or sell things online with digital dollars. I can now be part of a global, financial ecosystem, with my smartphone and my wallet. >> That's a great use case, congratulations on amazing success, so much is on your plate, you've had great success in this new era, what's on your plate now, what are you working on, what's happening in your world now? >> So in 2017, we realized Bitt was entering a new growth phase. It was no longer a battle of trying to convince regulators and central banks, our product had been proven. Our reputation had been proven. It was time now to scale the company into a professional level of dealing with these regulators around the world. At the end of the day, we would like to digitize cash, wherever cash exists. And to provide those tools for central banks around the world. That would require professional management, and that is not I. >> (laughs) >> So, our investors and shareholders were quite comfortable with our proposal of bringing on that professional management, so in 2017 I resigned as CEO, retained a board position and still single largest shareholder, but with the idea of what other types of infrastructure can I build, now that a deep infrastructure had been put in place. So I've been attacking three major markets, the banking sector, an actual commercial banking enterprise working with a group from the United States towards looking at deploying the future of where we think commercial banking is going. I think that the community, the crypto community in general, there's a lot of noise happening in the chats. And therefore we built a machine learning chat bot to start looking at market sentiments and aggregating market information and of course building common tools for community members. So we've launched a agent called Gabby, the form to gab. My name's Gabriel and my mom calls me Gabby, so it works out quite well. >> You have the gift of gab that's for sure. >> And then I launched a mutual fund with a very sophisticated former managing director of JPMorgan. A guy named Richard Galvin. And we launched the world's first protocol-only fund. We focus only on protocols. And that's called Digital Asset Fund. And we launched that in late 2017 and got full regulatory approval to become a professional fund, that handles 100 percent, solely crypto. And that's basically been my ride, and then outside of that, just your standard consulting, because everybody from World Bank, to IADB, to some government agency to some private organization wants to know about blockchain they want advice, and they need a team of people to give them that advice. So it's just been, all around, looking at how I can be an entrepreneur in this space, while finding great leaders, and partnering with those leaders to build out great companies. While still focusing on ensuring bitt.com becomes the solution for dollars, digital dollars, worldwide. >> Got a great mission, entrepreneur, builder, congratulations. >> Thank you. >> Industry's lucky to have you, congratulations. >> Thanks for coming on. >> Thanks for coming on theCUBE. >> Thank you guys. >> CUBE coverage here, live in Toronto for the first Global Cloud and Blockchain Summit in concert with the Blockchain Futures Conference happening in the next two days after today. More coverage from theCUBE we're live here, stay with us for more great coverage after this short break. (upbeat electronic music)

>> Narrator: Vancouver, Canada. It's theCUBE, covering OpenStack Summit North America, 2018. Brought to you by Red Hat, the OpenStack Foundation and its Ecosystem partners. (soft music) >> Hi, and you're watching SiliconANGLE Medias coverage of theCUBE, here at OpenStack Summit 2018 in beautiful Vancouver. I'm Stu Miniman with my co-host John Troyer. We've been here, this is now the third day of coverage, John. We've done a couple dozen interviews already. We've got one more day of coverage. We had some kind of perceptions coming in and I have some interesting differing viewpoints as to where we are for OpenStack the project, where this show itself is going. First of all John, give me your impressions overall. Vancouver, your first time here, city I fell in love with last time I came here, and let's get into the show itself, too. >> Sure, sure, I mean the show's a little bit smaller this year than it had been in past years. Some of that is because they pulled some of the technical stuff out last year, or a couple years ago. By being a little bit smaller, and being in a place like Vancouver, I get good energy off of the crowd. The folks we've talked to, the folks that have been going to sessions, have said they've been very good. The people here are practitioners. They are running OpenStack, or about to run OpenStack, or upgrading their OpenStack, or other adjacent technologies. They're real people doing real work. As we talk to folks and sponsors, the conversations have been productive. So, I'd say in general, this kind of a small venue and a beautiful city allows for a really productive community-oriented event, so that's been great. >> Alright, so John come on, on the analysis segment we're not allow to pull any punches. Attendance, absolutely is down. Three years ago when we were here it was around 5500. Mark Collier, on our opening segment, said there was about 2600. But two-year point, I've not talked to a single vendor or attendee here that was like, "Oh boy, nobody's here, "it's not goin' on." Yes, the Expo Hall is way smaller and people flowing through the Expo Hall isn't great all the time, but why is that? Because the people that are here, they're in sessions. They have 40 sessions about Edge Computing. Hot topic, we've talked a bunch about that. Interesting conversations. There is way more in Containers. Containers for more than three years, been a topic conversation. There's so many other sessions of people digging in. The line you've used a couple a time is the people here are people that have mortgages. In a good way, it means these are jobs, these are not them, "Oh, I heard about "this cool new thing, and I'm going to "go check out beautiful Vancouver." Now, yes, we've brought our spouses or significant others, and checking out the environment because yeah, this place is awesome, but there's good energy at the show. There's good technical conversation. Many of the people we've talked to, even if they're not the biggest OpenStack fans, they're like, "But our customers are using this in a lot of different ways." Let's talk about OpenStack. Where is it, where isn't it? What's your take from what you've heard from the customers and the vendors? >> Sure, I definitely think the conversation is warranted. As we came in, from outside the community there was a lot of conversation, even backchannel, like why are you going to OpenStack Summit? What's going on there, is it still alive? Which is kind of a perception of maybe it's an indication of where the marketing is on this project, or where it is on the hype cycle. In terms of where it is and where it isn't, it's built into everything. At this point OpenStack, the infrastructure management, open infrastructure management solution, seems to be mature. Seems to be inside every Telco, every cable company, every transportation company, every bank. People who need private resources and have the smarts and power to do that have leveraged OpenStack now. That seems stable. What was interesting here is, that that doesn't speak to the health overall, and the history of, or the future of the project itself, the foundation, the Summit, I think those are separate questions. You know, the infrastructure and projects seem good. Also here, like we've talked about, this show is not just about OpenStack now. It's about Containers, it's broadening the scope of these people informally known as infrastructure operators, to the application level as well. >> Yeah, if you want to hear a little bit more, some two great interviews we did yesterday. Sean Michael Kerner, who's a journalist. Been here for almost every single one of the OpenStack shows. He's at eWeek, had some really good discussion. He said private cloud, it doesn't exist. Now, he said what does he mean by that? There are companies that are building large scalable cloud with OpenStack but it's like if some of the big China Telecom, big China cloud companies. Oracle and IBM have lots of OpenStack, in what they do, and yes there are, as you mentioned, the telcos are a big used case. We had some Canonical customers talking about Edge as in a used case for a different type of scalability. Lots of nodes but not one massive infrastructure as a service piece. If I talk, kind of the typical enterprise, or definitely going the SNE piece of the market, this is not something that they go and use. They will use services that have OpenStack. It might be part of the ecosystem that they're playing, but people saying, "Oh, I had my VMware environment "and I want to go from virtualization "to private cloud" OpenStack is not usually the first choice, even though Red Hat has some customers that kind of fit into some of the larger sides of that, and we'll be talking to them more about that today. Randy Bias is the other one, take a look. Randy was one of the early, very central to a lot of stuff happening in the Foundation. He's in the networking space now, and he says even though he's not a cheerleader for OpenStack, he's like, "Why am I here? "That's where my customers are." >> Right, right. I mean, I do think it's interesting that public cloud is certainly mentioned. AWS, Google, et cetera, but it's not top of mind for a lot of these folks, and it's mentioned in very different ways depending on, kind of, the players. I think it's very different from last week at Red Hat Summit. Red Hat, with their story, and OpenShift on top of OpenStack, definitely talked public cloud for folks. Then they cross-cloud, hybrid-cloud. I think that was a much different conversation than I've been hearing this week. I think basically, kind of maybe, depends on the approach of the different players in the market, Stu. I know you've been talkin' to different folks about that. >> Yeah, absolutely. So like, Margaret Dawson at Red Hat helped us talk about how that hybrid-cloud works because here, I hate to say it's, some oh yeah, public cloud, that's too expensive. You're renting, it's always going to be more. It's like, well no, come on, let's understand. There's lot of applications that are there and customers, it's an and message for almost all of them. How does that fit together, I have some critiques as to how this goes together. You brought up another point though John, OpenStack Foundation is more than just OpenStack projects. So, Kata Containers, something that was announced last year, and we're talking about there's Edge, there's a new CI/CD tool, Zuul, which is now fully under the project. Yes, joke of the week, there is no OpenStack, there's only Zuul. There are actually, there's another open-source project named Zuul too, so boy, how many CI/CD tools are out there? We've got two different, unrelated, projects with the same name. John, you look at communities, you look at foundations, if this isn't the core knitting of OpenStack, what is their role vis-a-vis the cloud native and how do they compare to say, the big player in this space is Linux Foundation which includes CNCF. >> That's a good one. I mean, in some sense like all organic things, things are either growing or shrinking. Just growing or dying. On the other hand, in technology, nothing ever truly dies. I think the project seems mature and healthy and it's being used. The Foundation is global in scope and continues to run this. I do wonder about community identity and what it means to be an OpenStack member. It's very community-oriented, but what's at the nut of it here if we're really part of this cloud-native ecosystem. CNCF, you know, it's part of Linux Foundation, all these different foundations, but CNCF, on the other hand, is kind of a grab-bag of technology, so I'm not sure what it means to be a member of CNCF either. I think both of these foundations will continue to go forward with slightly different identities. I think for the community as a whole, the industry as a whole, they are talking and they better be talking, and it's good that they're talking now and working better together. >> Yeah, great discussion we had with Lisa-Marie Namphy who is an OpenStack Ambassador. She holds the meat up in Silicon Valley and when she positions it, it's about cloud-native and its about all these things. So like, Kubernetes is front and center whereas some of the OpenStack people are saying, "Oh no, no, we need to talk more about OpenStack." That's still the dynamic here was, "Oh, we go great together." Well, sometimes thou dost protest too much. Kubranetes doesn't need OpenStack, OpenStack absolutely must be able to play in this Container, cloud-native Kubranetes world. There's lots of other places we can learn about Kubranetes. It is an interesting dynamic that have been sorting out, but it is not a zero-sum game. There's absolutely lots, then we have, I actually was real impressed how many customers we got to speak with on the air this time. Nice with three days of programming, we had a little bit of flexibility, and not just people that were on the keynote stage. Not just people that have been coming for years, but a few of the interviews we had are relatively new. Not somebody that have been on since very early in the alphabet, now we're at queens. >> Right. >> Anything more from the customers or that Container, Kubranetes dynamic that you want to cover? >> Sure, well I mean just that, you know, Containers at least, Containers are everywhere here. So, I think that kind of question has been resolved in some sense. It was a little more contentious last year than this year. I'm actually more bullish on OpenStack as a utility project, after this week, than before. I think I can constantly look people in the eye and say that. The interesting thing for me though, coming from Silicon Valley, is you're so used to thinking about VCs and growth, and new startups, and where's the cutting edge that it's kind of hard to talk about this, maybe this open source business model where the customer basis is finite. It's not growing at 100% a year. Sometimes the press has a hard time covering that. Analysts have a hard time covering that. And if you wanted to give advice to somebody to get into OpenStack, I'm not sure who should if they're not in it already, there's definitely defined use cases, but I think maybe those people have already self-identified. >> Alright, so yeah, the last thing I wanted to mention is yeah. Big thank you to our sponsors to help get us here. The OpenStack Foundation, really supportive of us for years. Six years of us covering it. Our headline sponsor, Red Hat, had some great customers. Talked about this piece, and kind of we talk about it's practically Red Hat month on theCUBE for John with Red Hat Summit and OpenStack. Canonical, Contron, Nuage Networks, all helping us to be able to bring this content to you. Be sure to check out theCUBE.net for all the coverage in the past as well as where we'll be. Hit John Troyer, J. Troyer, on Twitter or myself, Stu, on Twitter if you ever have any questions, people we should be talking to, viewpoints, whether you agree or disagree with what we're talking about. Big thanks to all of our crew here. Thank you to the wonderful people of Vancouver for being so welcoming of this event and of all of us. Check out all the interviews. For John Troyer, I'm Stu Miniman. Thanks for watching theCUBE. (soft upbeat music)