>>Hello, everyone. Welcome to the cubes coverage here. New York city for AWS Amazon web services summit 2022. I'm John furrier, host of the cube with Dave ante. My co-host. We are breaking it down, getting an update on the ecosystem. As the GDP drops, inflations up gas prices up the enterprise continues to grow. We're seeing exceptional growth. We're here on the ground floor. Live at the Summit's packed house, 10,000 people. Eric Bradley's here. Chief STR at ETR, one of the premier enterprise research firms out there, partners with the cube and powers are breaking analysis that Dave does check that out as the hottest podcast in enterprise. Eric. Great to have you on the cube. Thanks for coming on. >>Thank you so much, John. I really appreciate the collaboration always. >>Yeah. Great stuff. Your data's amazing ETR folks watching check out ETR. They have a unique formula, very accurate. We love it. It's been moving the market. Congratulations. Let's talk about the market right now. This market is booming. Enterprise is the hottest thing, consumers kind of in the toilet. Okay. I said that all right, back out devices and, and, and consumer enterprise is still growing. And by the way, this first downturn, the history of the world where hyperscalers are on full pumping on all cylinders, which means they're still powering the revolution. >>Yeah, it's true. The hyperscalers were basically at this two sun system when Microsoft and an AWS first came around and everything was orbiting around it. And we're starting to see that sun cool off a little bit, but we're talking about a gradient here, right? When we say cool off, we're not talking to shutdown, it's still burning hot. That's for sure. And I can get it to some of the macro data in a minute, if that's all right. Or do you want me to go right? No, go go. Right. Yeah. So right now we just closed our most recent survey and that's macro and vendor specific. We had 1200 people talk to us on the macro side. And what we're seeing here is a cool down in spending. We originally had about 8.5% increase in budgets. That's cool down is 6.5 now, but I'll say with the doom and gloom and the headlines that we're seeing every day, 6.5% growth coming off of what we just did the last couple of years is still pretty fantastic as a backdrop. >>Okay. So you, you started to see John mentioned consumer. We saw that in Snowflake's earnings. For example, we, we certainly saw, you know, Walmart, other retailers, the FA Facebooks of the world where consumption was being dialed down, certain snowflake customers. Not necessarily, they didn't have mentioned any customers, but they were able to say, all right, we're gonna dial down, consumption this quarter, hold on until we saw some of that in snowflake results and other results. But at the same time, the rest of the industry is booming. But your data is showing softness within the fortune 500 for AWS, >>Not only AWS, but fortune 500 across the board. Okay. So going back to that larger macro data, the biggest drop in spending that we captured is fortune 500, which is surprising. But at the same time, these companies have a better purview into the economy. In general, they tend to see things further in advance. And we often remember they spend a lot of money, so they don't need to play catch up. They'll easily more easily be able to pump the brakes a little bit in the fortune 500. But to your point, when we get into the AWS data, the fortune 500 decrease seems to be hitting them a little bit more than it is Azure and GCP. I >>Mean, we're still talking about a huge business, right? >>I mean, they're catching up. I mean, Amazon has been transforming from owning the developer cloud startup cloud decade ago to really putting a dent on the enterprise as being number one cloud. And I still contest that they're number one by a long ways, but Azure kicking ass and catching up. Okay. You seeing people move to Azure, you got Charlie bell over there, Sean, by former Amazonians, Theresa Carlson, people are going over there, there there's lift over at Azure. >>There certainly is. >>Is there kinks in the arm or for AWS? There's >>A couple of kinks, but I think your point is really good. We need to take a second there. If you're talking about true pass or infrastructure is a service true cloud compute. I think AWS still is the powerhouse. And a lot of times the, the data gets a little muddied because Azure is really a hosted platform for applications. And you're not really sure where that line is drawn. And I think that's an important caveat to make, but based on the data, yes, we are seeing some kinks in the armor for AWS. Yes. Explain. So right now, a first of all caveat, 40% net score, which is our proprietary spending metric across the board. So we're not like raising any alarms here. It's still strong that said there are declines and there are declines pretty much across the board. The only spot we're not seeing a decline at all is in container, spend everything else is coming down specifically. We're seeing it come down in data analytics, data warehousing, and M I, which is a little bit of a concern because that, that rate of decline is not the same with Azure. >>Okay. So I gotta ask macro, I see the headwinds on the macro side, you pointed that out. Is there any insight into any underlying conditions that might be there on AWS or just a chronic kind of situational thing >>Right now? It seems situational. Other than that correlation between their big fortune 500, you know, audience and that being our biggest decline. The other aspect of the macro survey is we ask people, if you are planning to decline spend, how do you plan on doing it? And the number two answer is taking a look at our cloud spend and auditing it. So they're kind say, all right, you know, for the last 10 years it's been drunken, sail or spend, I >>Was gonna use that same line, you know, >>Cloud spend, just spend and we'll figure it out later, who cares? And then right now it's time to tighten the belts a little bit, >>But this is part of the allure of cloud at some point. Yeah. You, you could say, I'm gonna, I'm gonna dial it down. I'm gonna rein it in. So that's part of the reason why people go to the cloud. I want to, I wanna focus in on the data side of things and specifically the database. Let, just to give some context if, and correct me if I'm, I'm a little off here, but snowflake, which hot company, you know, on the planet, their net score was up around 80% consistently. It it's dropped down the last, you know, quarter, last survey to 60%. Yeah. So still highly, highly elevated, but that's relative to where Amazon is much larger, but you're saying they're coming down to the 40% level. Is that right? >>Yeah, they are. And I remember, you know, when I first started doing this 10 years ago, AWS at a 70%, you know, net score as well. So what's gonna happen over time is those adoptions are gonna get less and you're gonna see more flattening of spend, which ultimately is going to lower the score because we're looking for expansion rates. We wanna see adoption and increase. And when you see flattening a spend, it starts to contract a little bit. And you're right. Snowflake also was in the stratosphere that cooled off a little bit, but still, you know, very strong and AWS is coming down. I think the reason why it's so concerning is because a it's within the fortune 500 and their rate of decline is more than Azure right >>Now. Well, and, and one of the big trends you're seeing in database is this idea of converging function. In other words, bringing transaction and analytics right together at snowflake summit, they added the capability to handle transaction data, Mongo DB, which is largely mostly transactions added the capability in June to bring in analytic data. You see data bricks going from data engineering and data science now getting into snowflake space and analytics. So you're seeing that convergence Oracle is converging with my SQL heat wave and their core databases, couch base couch base is doing the same. Maria do virtually all these database companies are, are converging their platforms with the exception of AWS. AWS is still the right tool for the right job. So they've got Aurora, they've got RDS, they've got, you know, a dynamo DV, they've got red, they've got, you know, going on and on and on. And so the question everybody's asking is will that change? Will they start to sort of cross those swim lanes? We haven't seen it thus far. How is that affecting the data >>Performance? I mean, that's fantastic analysis. I think that's why we're seeing it because you have to be in the AWS ecosystem and they're really not playing nicely with others in the sandbox right now that now I will say, oh, Amazon's not playing nicely. Well, no, no. Simply to your point though, that there, the other ones are actually bringing in others at consolidating other different vendor types. And they're really not. You know, if you're in AWS, you need to stay within AWS. Now I will say their tools are fantastic. So if you do stay within AWS, they have a tool for every job they're advanced. And they're incredible. I think sometimes the complexity of their tools hurts them a little bit. Cause to your point earlier, AWS started as a developer-centric type of cloud. They have moved on to enterprise cloud and it's a little bit more business oriented, but their still roots are still DevOps friendly. And unless you're truly trained, AWS can be a little scary. >>So a common use case is I'm gonna be using Aurora for my transaction system and then I'm gonna ETL it into Redshift. Right. And, and I, now I have two data stores and I have two different sets of APIs and primitives two different teams of skills. And so that is probably causing some friction and complexity in the customer base that again, the question is, will they begin to expand some of those platforms to minimize some of that friction? >>Well, yeah, this is the question I wanted to ask on that point. So I've heard from people inside Amazon don't count out Redshift, we're making, we're catching up. I think that's my word, but they were kind of saying that right. Cuz Redshift is good, good database, but they're adding a lot more. So you got snowflake success. I think it's a little bit of a jealousy factor going on there within Redshift team, but then you got Azure synapse with the Synap product synapse. Yep. And then you got big query from Google big >>Query. Yep. >>What's the differentiation. What are you seeing for the data for the data warehouse or the data clouds that are out there for the customers? What's the data say, say to us? >>Yeah, unfortunately the data's showing that they're dropping a little bit whose day AWS is dropping a little bit now of their data products, Redshift and RDS are still the two highest of them, but they are starting to decline. Now I think one of the great data points that we have, we just closed the survey is we took a comparison of the legacy data. Now please forgive me for the word legacy. We're gonna anger a few people, but we Gotter data Oracle on-prem, we've got IBM. Some of those more legacy data warehouse type of names. When we look at our art survey takers that have them where their spend is going, that spends going to snowflake first, and then it's going to Google and then it's going to Microsoft Azure and, and AWS is actually declining in there. So when you talk about who's taking that legacy market share, it's not AWS right now. >>So legacy goes to legacy. So Microsoft, >>So, so let's work through in a little context because Redshift really was the first to take, you know, take the database to the cloud. And they did that by doing a one time license deal with par XL, which was an on-prem database. And then they re-engineered it, they did a fantastic job, but it was still engineered for on-prem. Then you along comes snowflake a couple years later and true cloud native, same thing with big query. Yep. True cloud native architecture. So they get a lot of props. Now what, what Amazon did, they took a page outta of the snowflake, for example, separating compute from storage. Now of course what's what, what Amazon did is actually not really completely separating like snowflake did they couldn't because of the architecture, they created a tearing system that you could dial down the compute. So little nuances like that. I understand. But at the end of the day, what we're seeing from snowflake is the gathering of an ecosystem in this true data cloud, bringing in different data types, they got to the public markets, data bricks was not able to get to the public markets. Yeah. And think is, is struggling >>And a 25 billion evaluation. >>Right. And so that's, that's gonna be dialed down, struggling somewhat from a go to market standpoint where snowflake has no troubles from a go to market. They are the masters at go to market. And so now they've got momentum. We talked to Frank sluman at the snowflake. He basically said, I'm not taking the foot off the gas, no way. Yeah. We, few of our large, you know, consumer customers dialed things down, but we're going balls to the >>Wall. Well, if you look at their show before you get in the numbers, you look at the two shows. Snowflake had their summit in person in Vegas. Data bricks has had their show in San Francisco. And if you compare the two shows, it's clear, who's winning snowflake is blew away from a, from a market standpoint. And we were at snowflake, but we weren't at data bricks, but there was really nothing online. I heard from sources that it was like less than 3000 people. So >>Snowflake was 1900 people in 2019, nearly 10,000. Yeah. In 2020, >>It's gonna be fun to sort of track that as a, as an odd caveat to say, okay, let's see what that growth is. Because in fairness, data, bricks, you know, a little bit younger, Snowflake's had a couple more years. So I'd be curious to see where they are. Their, their Lakehouse paradigm is interesting. >>Yeah. And I think it's >>And their product first company, yes. Their go to market might be a little bit weak from our analysis, but that, but they'll figure it out. >>CEO's pretty smart. But I think it's worth pointing out. It's like two different philosophies, right? It is. Snowflake is come into our data cloud. That's their proprietary environment. They're the, they think of the iPhone, right? End to end. We, we guarantee it's all gonna work. And we're in control. Snowflake is like, Hey, open source, no, bring in data bricks. I mean data bricks, open source, bring in this tool that too, now you are seeing snowflake capitulate a little bit. They announce, for instance, Apache iceberg support at their, at the snowflake summit. So they're tipping their cap to open source. But at the end of the day, they're gonna market and sell the fact that it's gonna run better in native snowflake. Whereas data bricks, they're coming at it from much more of an open source, a mantra. So that's gonna, you know, we'll see who look at, you had windows and you had apple, >>You got, they both want, you got Cal and you got Stanford. >>They both >>Consider, I don't think it's actually there yet. I, I find the more interesting dynamic right now is between AWS and snowflake. It's really a fun tit for tat, right? I mean, AWS has the S three and then, you know, snowflake comes right on top of it and announces R two, we're gonna do one letter, one number better than you. They just seem to have this really interesting dynamic. And I, and it is SLT and no one's betting against him. I mean, this guy's fantastic. So, and he hasn't used his war chest yet. He's still sitting on all that money that he raised to your point, that data bricks five, their timing just was a little off >>5 billion in >>Capital when Slootman hasn't used that money yet. So what's he gonna do? What can he do when he turns that on? He finds the right. >>They're making some acquisitions. They did the stream lit acquisitions stream. >>Fantastic >>Problem. With data bricks, their valuation is underwater. Yes. So they're recruiting and their MNAs. Yes. In the toilet, they cannot make the moves because they don't have the currency until they refactor the multiple, let the, this market settle. I I'm, I'm really nervous that they have to over factor the >>Valuation. Having said that to your point, Eric, the lake house architecture is definitely gaining traction. When you talk to practitioners, they're all saying, yeah, we're building data lakes, we're building lake houses. You know, it's a much, much smaller market than the enterprise data warehouse. But nonetheless, when you talk to practitioners that are actually doing things like self serve data, they're building data lakes and you know, snow. I mean, data bricks is right there. And as a clear leader in, in ML and AI and they're ahead of snowflake, right. >>And I was gonna say, that's the thing with data bricks. You know, you're getting that analytics at M I built into it. >>You know, what's ironic is I remember talking to Matt Carroll, who's CEO of auDA like four or five years ago. He came into the office in ma bro. And we were in temporary space and we were talking about how there's this new workload emerging, which combines AWS for cloud infrastructure, snowflake for the simple data warehouse and data bricks for the ML AI, and then all now all of a sudden you see data bricks yeah. And snowflake going at it. I think, you know, to your point about the competition between AWS and snowflake, here's what I think, I think the Redshift team is, you know, doesn't like snowflake, right. But I think the EC two team loves it. Loves it. Exactly. So, so I think snowflake is driving a lot of, >>Yeah. To John's point, there is plenty to go around. And I think I saw just the other day, I saw somebody say less than 40% of true global 2000 organizations believe that they're at real time data analytics right now. They're not really there yet. Yeah. Think about how much runway is left and how many tools you need to get to real time streaming use cases. It's complex. It's not easy. >>It's gonna be a product value market to me, snowflake in data bricks. They're not going away. Right. They're winning architectures. Yeah. In the cloud, what data bricks did would spark and took over the Haddo market. Yeah. To your point. Now that big data, market's got two players, in my opinion, snow flicking data, bricks converging. Well, Redshift is sitting there behind the curtain, their wild card. Yeah. They're wild card, Dave. >>Okay. I'm gonna give one more wild card, which is the edge. Sure. Okay. And that's something that when you talk about real time analytics and AI referencing at the edge, there aren't a lot of database companies in a position to do that. You know, Amazon trying to put outposts out there. I think it runs RDS. I don't think it runs any other database. Right. Snowflake really doesn't have a strong edge strategy when I'm talking the far edge, the tiny edge. >>I think, I think that's gonna be HPE or Dell's gonna own the outpost market. >>I think you're right. I'll come back to that. Couch base is an interesting company to watch with Capella Mongo. DB really doesn't have a far edge strategy at this point, but couch base does. And that's one to watch. They're doing some really interesting things there. And I think >>That, but they have to leapfrog bongo in my >>Opinion. Yeah. But there's a new architecture emerging at the edge and it's gonna take a number of years to develop, but it could eventually from an economic standpoint, seep back into the enterprise arm base, low end, take a look at what couch base is >>Doing. They hired an Amazon guard system. They have to leapfrog though. They need to, they can't incrementally who's they who >>Couch >>Base needs to needs to make a big move in >>Leap frog. Well, think they're trying to, that's what Capella is all about was not only, you know, their version of Atlas bringing to the cloud couch base, but it's also stretching it out to the edge and bringing converged database analytics >>Real quick on the numbers. Any data on CloudFlare, >>I was, I've been sitting here trying to get the word CloudFlare out my mouth the whole time you guys were talking, >>Is this another that's innovated in the ecosystem. So >>Platform, it was really simple for them early on, right? They're gonna get that edge network out there and they're gonna steal share from Akamai. Then they started doing exactly what Akamai did. We're gonna start rolling out some security. Their security is fantastic. Maybe some practitioners are saying a little bit too much, cuz they're not focused on one thing or another, but they are doing extremely well. And now they're out there in the cloud as well. You >>Got S3 compare. They got two, they got an S3 competitor. >>Exactly. So when I'm listening to you guys talk about, you know, a, a couch base I'm like, wow, those two would just be an absolute fantastic, you know, combination between the two of them. You mean >>CloudFlare >>Couch base. Yeah. >>I mean you got S3 alternative, right? You got a Mongo alternative basically in my >>Opinion. And you're going and you got the edge and you got the edge >>Network with security security, interesting dynamic. This brings up the super cloud date. I wanna talk about Supercloud because we're seeing a trend on we're reporting this since last year that basically people don't have to spend the CapEx to be cloud scale. And you're seeing Amazon enable that, but snowflake has become a super cloud. They're on AWS. Now they're on Azure. Why not tan expansion expand the market? Why not get that? And then it'll be on Google next, all these marketplaces. So the emergence of this super cloud, and then the ability to make that across a substrate across multiple clouds is a strategy we're seeing. What do you, what do you think? >>Well, honestly, I'm gonna be really Frank here. The, everything I know about the super cloud I know from this guy. So I've been following his lead on this and I'm looking forward to you guys doing that conference and that summit coming up from a data perspective. I think what you're saying is spot on though, cuz those are the areas we're seeing expansion in without a doubt. >>I think, you know, when you talk about things like super cloud and you talk about things like metaverse, there's, there's a, there, there look every 15 or 20 years or so this industry reinvents itself and a new disruption comes out and you've got the internet, you've got the cloud, you've got an AI and VR layer. You've got, you've got machine intelligence. You've got now gaming. There's a new matrix, emerging, super cloud. Metaverse there's something happening out there here. That's not just your, your father's SAS or is or pass. Well, >>No, it's also the spend too. Right? So if I'm a company like say capital one or Goldman Sachs, my it spend has traditionally been massive every year. Yes. It's basically like tons of CapEx comes the cloud. It's an operating expense. Wait a minute, Amazon has all the CapEx. So I'm not gonna dial down my budget. I want a competitive advantage. So next thing they know they have a super cloud by default because they just pivoted their, it spend into new capabilities that they then can sell to the market in FinTech makes total sense. >>Right? They're building out a digital platform >>That would, that was not possible. Pre-cloud >>No, it wasn't cause you weren't gonna go put all that money into CapEx expenditure to build that out. Not knowing whether or not the market was there, but the scalability, the ability to spend, reduce and be flexible with it really changes that paradigm entire. >>So we're looking at this market now thinking about, okay, it might be Greenfield in every vertical. It might have a power law where you have a head of the long tail. That's a player like a capital one, an insurance. It could be Liberty mutual or mass mutual that has so much it and capital that they're now gonna scale it into a super cloud >>And they have data >>And they have the data tools >>And the tools. And they're gonna bring that to their constituents. Yes, yes. And scale it using >>Cloud. So that means they can then service the entire vertical as a service provider. >>And the industry cloud is becoming bigger and bigger and bigger. I mean, that's really a way that people are delivering to market. So >>Remember in the early days of cloud, all the banks thought they could build their own cloud. Yeah. Yep. Well actually it's come full circle. They're like, we can actually build a cloud on top of the cloud. >>Right. And by the way, they can have a private cloud in their super cloud. Exactly. >>And you know, it's interesting cause we're talking about financial services insurance, all the people we know spend money in our macro survey. Do you know the, the sector that's spending the most right now? It's gonna shock you energy utilities. Oh yeah. I was gonna, the energy utilities industry right now is the one spending the most money I saw largely cuz they're playing ketchup. But also because they don't have these type of things for their consumers, they need the consumer app. They need to be able to do that delivery. They need to be able to do metrics. And they're the they're, they're the one spending right >>Now it's an arms race, but the, the vector shifts to value creation. So >>It's it just goes back to your post when it was a 2012, the trillion dollar baby. Yeah. It's a multi-trillion dollar baby that they, >>The world was going my chassis post on Forbes, headline trillion dollar baby 2012. You know, I should add it's happening. That's >>On the end. Yeah, exactly. >>Trillions of babies, Eric. Great to have you on the key. >>Thank you so much guys. >>Great to bring the data. Thanks for sharing. Check out ETR. If you're into the enterprise, want to know what's going on. They have a unique approach, very accurate in their survey data. They got a great market basket of, of, of, of, of data questions and people and community. Check it out. Thanks for coming on and sharing with. >>Thank you guys. Always enjoy. >>We'll be back with more coverage here in the cube in New York city live at summit 22. I'm John fur with Dave ante. We'll be right back.