>> From theCUBE Studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE and ETR, this is Breaking Analysis with Dave Vellante. >> This past week we saw two of the Big 3 cloud providers present the latest update on their respective cloud visions, their business progress, their announcements and innovations. The content at these events had many overlapping themes, including modern cloud infrastructure at global scale, applying advanced machine intelligence, AKA AI, end-to-end data platforms, collaboration software. They talked a lot about the future of work automation. And they gave us a little taste, each company of the Metaverse Web 3.0 and much more. Despite these striking similarities, the differences between these two cloud platforms and that of AWS remains significant. With Microsoft leveraging its massive application software footprint to dominate virtually all markets and Google doing everything in its power to keep up with the frenetic pace of today's cloud innovation, which was set into motion a decade and a half ago by AWS. Hello and welcome to this week's Wikibon CUBE Insights, powered by ETR. In this Breaking Analysis, we unpack the immense amount of content presented by the CEOs of Microsoft and Google Cloud at Microsoft Ignite and Google Cloud Next. We'll also quantify with ETR survey data the relative position of these two cloud giants in four key sectors: cloud IaaS, BI analytics, data platforms and collaboration software. Now one thing was clear this past week, hybrid events are the thing. Google Cloud Next took place live over a 24-hour period in six cities around the world, with the main gathering in New York City. Microsoft Ignite, which normally is attended by 30,000 people, had a smaller event in Seattle, in person with a virtual audience around the world. AWS re:Invent, of course, is much different. Yes, there's a virtual component at re:Invent, but it's all about a big live audience gathering the week after Thanksgiving, in the first week of December in Las Vegas. Regardless, Satya Nadella keynote address was prerecorded. It was highly produced and substantive. It was visionary, energetic with a strong message that Azure was a platform to allow customers to build their digital businesses. Doing more with less, which was a key theme of his. Nadella covered a lot of ground, starting with infrastructure from the compute, highlighting a collaboration with Arm-based, Ampere processors. New block storage, 60 regions, 175,000 miles of fiber cables around the world. He presented a meaningful multi-cloud message with Azure Arc to support on-prem and edge workloads, as well as of course the public cloud. And talked about confidential computing at the infrastructure level, a theme we hear from all cloud vendors. He then went deeper into the end-to-end data platform that Microsoft is building from the core data stores to analytics, to governance and the myriad tooling Microsoft offers. AI was next with a big focus on automation, AI, training models. He showed demos of machines coding and fixing code and machines automatically creating designs for creative workers and how Power Automate, Microsoft's RPA tooling, would combine with Microsoft Syntex to understand documents and provide standard ways for organizations to communicate with those documents. There was of course a big focus on Azure as developer cloud platform with GitHub Copilot as a linchpin using AI to assist coders in low-code and no-code innovations that are coming down the pipe. And another giant theme was a workforce transformation and how Microsoft is using its heritage and collaboration and productivity software to move beyond what Nadella called productivity paranoia, i.e., are remote workers doing their jobs? In a world where collaboration is built into intelligent workflows, and he even showed a glimpse of the future with AI-powered avatars and partnerships with Meta and Cisco with Teams of all firms. And finally, security with a bevy of tools from identity, endpoint, governance, et cetera, stressing a suite of tools from a single provider, i.e., Microsoft. So a couple points here. One, Microsoft is following in the footsteps of AWS with silicon advancements and didn't really emphasize that trend much except for the Ampere announcement. But it's building out cloud infrastructure at a massive scale, there is no debate about that. Its plan on data is to try and provide a somewhat more abstracted and simplified solutions, which differs a little bit from AWS's approach of the right database tool, for example, for the right job. Microsoft's automation play appears to provide simple individual productivity tools, kind of a ground up approach and make it really easy for users to drive these bottoms up initiatives. We heard from UiPath that forward five last month, a little bit of a different approach of horizontal automation, end-to-end across platforms. So quite a different play there. Microsoft's angle on workforce transformation is visionary and will continue to solidify in our view its dominant position with Teams and Microsoft 365, and it will drive cloud infrastructure consumption by default. On security as well as a cloud player, it has to have world-class security, and Azure does. There's not a lot of debate about that, but the knock on Microsoft is Patch Tuesday becomes Hack Wednesday because Microsoft releases so many patches, it's got so much Swiss cheese in its legacy estate and patching frequently, it becomes a roadmap and a trigger for hackers. Hey, patch Tuesday, these are all the exploits that you can go after so you can act before the patches are implemented. And so it's really become a problem for users. As well Microsoft is competing with many of the best-of-breed platforms like CrowdStrike and Okta, which have market momentum and appear to be more attractive horizontal plays for customers outside of just the Microsoft cloud. But again, it's Microsoft. They make it easy and very inexpensive to adopt. Now, despite the outstanding presentation by Satya Nadella, there are a couple of statements that should raise eyebrows. Here are two of them. First, as he said, Azure is the only cloud that supports all organizations and all workloads from enterprises to startups, to highly regulated industries. I had a conversation with Sarbjeet Johal about this, to make sure I wasn't just missing something and we were both surprised, somewhat, by this claim. I mean most certainly AWS supports more certifications for example, and we would think it has a reasonable case to dispute that claim. And the other statement, Nadella made, Azure is the only cloud provider enabling highly regulated industries to bring their most sensitive applications to the cloud. Now, reasonable people can debate whether AWS is there yet, but very clearly Oracle and IBM would have something to say about that statement. Now maybe it's not just, would say, "Oh, they're not real clouds, you know, they're just going to hosting in the cloud if you will." But still, when it comes to mission-critical applications, you would think Oracle is really the the leader there. Oh, and Satya also mentioned the claim that the Edge browser, the Microsoft Edge browser, no questions asked, he said, is the best browser for business. And we could see some people having some questions about that. Like isn't Edge based on Chrome? Anyway, so we just had to question these statements and challenge Microsoft to defend them because to us it's a little bit of BS and makes one wonder what else in such as awesome keynote and it was awesome, it was hyperbole. Okay, moving on to Google Cloud Next. The keynote started with Sundar Pichai doing a virtual session, he was remote, stressing the importance of Google Cloud. He mentioned that Google Cloud from its Q2 earnings was on a $25-billion annual run rate. What he didn't mention is that it's also on a 3.6 billion annual operating loss run rate based on its first half performance. Just saying. And we'll dig into that issue a little bit more later in this episode. He also stressed that the investments that Google has made to support its core business and search, like its global network of 22 subsea cables to support things like, YouTube video, great performance obviously that we all rely on, those innovations there. Innovations in BigQuery to support its search business and its threat analysis that it's always had and its AI, it's always been an AI-first company, he's stressed, that they're all leveraged by the Google Cloud Platform, GCP. This is all true by the way. Google has absolutely awesome tech and the talk, as well as his talk, Pichai, but also Kurian's was forward thinking and laid out a vision of the future. But it didn't address in our view, and I talked to Sarbjeet Johal about this as well, today's challenges to the degree that Microsoft did and we expect AWS will at re:Invent this year, it was more out there, more forward thinking, what's possible in the future, somewhat less about today's problem, so I think it's resonates less with today's enterprise players. Thomas Kurian then took over from Sundar Pichai and did a really good job of highlighting customers, and I think he has to, right? He has to say, "Look, we are in this game. We have customers, 9 out of the top 10 media firms use Google Cloud. 8 out of the top 10 manufacturers. 9 out of the top 10 retailers. Same for telecom, same for healthcare. 8 out of the top 10 retail banks." He and Sundar specifically referenced a number of companies, customers, including Avery Dennison, Groupe Renault, H&M, John Hopkins, Prudential, Minna Bank out of Japan, ANZ bank and many, many others during the session. So you know, they had some proof points and you got to give 'em props for that. Now like Microsoft, Google talked about infrastructure, they referenced training processors and regions and compute optionality and storage and how new workloads were emerging, particularly data-driven workloads in AI that required new infrastructure. He explicitly highlighted partnerships within Nvidia and Intel. I didn't see anything on Arm, which somewhat surprised me 'cause I believe Google's working on that or at least has come following in AWS's suit if you will, but maybe that's why they're not mentioning it or maybe I got to do more research there, but let's park that for a minute. But again, as we've extensively discussed in Breaking Analysis in our view when it comes to compute, AWS via its Annapurna acquisition is well ahead of the pack in this area. Arm is making its way into the enterprise, but all three companies are heavily investing in infrastructure, which is great news for customers and the ecosystem. We'll come back to that. Data and AI go hand in hand, and there was no shortage of data talk. Google didn't mention Snowflake or Databricks specifically, but it did mention, by the way, it mentioned Mongo a couple of times, but it did mention Google's, quote, Open Data cloud. Now maybe Google has used that term before, but Snowflake has been marketing the data cloud concept for a couple of years now. So that struck as a shot across the bow to one of its partners and obviously competitor, Snowflake. At BigQuery is a main centerpiece of Google's data strategy. Kurian talked about how they can take any data from any source in any format from any cloud provider with BigQuery Omni and aggregate and understand it. And with the support of Apache Iceberg and Delta and Hudi coming in the future and its open Data Cloud Alliance, they talked a lot about that. So without specifically mentioning Snowflake or Databricks, Kurian co-opted a lot of messaging from these two players, such as life and tech. Kurian also talked about Google Workspace and how it's now at 8 million users up from 6 million just two years ago. There's a lot of discussion on developer optionality and several details on tools supported and the open mantra of Google. And finally on security, Google brought out Kevin Mandian, he's a CUBE alum, extremely impressive individual who's CEO of Mandiant, a leading security service provider and consultancy that Google recently acquired for around 5.3 billion. They talked about moving from a shared responsibility model to a shared fate model, which is again, it's kind of a shot across AWS's bow, kind of shared responsibility model. It's unclear that Google will pay the same penalty if a customer doesn't live up to its portion of the shared responsibility, but we can probably assume that the customer is still going to bear the brunt of the pain, nonetheless. Mandiant is really interesting because it's a services play and Google has stated that it is not a services company, it's going to give partners in the channel plenty of room to play. So we'll see what it does with Mandiant. But Mandiant is a very strong enterprise capability and in the single most important area security. So interesting acquisition by Google. Now as well, unlike Microsoft, Google is not competing with security leaders like Okta and CrowdStrike. Rather, it's partnering aggressively with those firms and prominently putting them forth. All right. Let's get into the ETR survey data and see how Microsoft and Google are positioned in four key markets that we've mentioned before, IaaS, BI analytics, database data platforms and collaboration software. First, let's look at the IaaS cloud. ETR is just about to release its October survey, so I cannot share the that data yet. I can only show July data, but we're going to give you some directional hints throughout this conversation. This chart shows net score or spending momentum on the vertical axis and overlap or presence in the data, i.e., how pervasive the platform is. That's on the horizontal axis. And we've inserted the Wikibon estimates of IaaS revenue for the companies, the Big 3. Actually the Big 4, we included Alibaba. So a couple of points in this somewhat busy data chart. First, Microsoft and AWS as always are dominant on both axes. The red dotted line there at 40% on the vertical axis. That represents a highly elevated spending velocity and all of the Big 3 are above the line. Now at the same time, GCP is well behind the two leaders on the horizontal axis and you can see that in the table insert as well in our revenue estimates. Now why is Azure bigger in the ETR survey when AWS is larger according to the Wikibon revenue estimates? And the answer is because Microsoft with products like 365 and Teams will often be considered by respondents in the survey as cloud by customers, so they fit into that ETR category. But in the insert data we're stripping out applications and SaaS from Microsoft and Google and we're only isolating on IaaS. The other point is when you take a look at the early October returns, you see downward pressure as signified by those dotted arrows on every name. The only exception was Dell, or Dell and IBM, which showing slightly improved momentum. So the survey data generally confirms what we know that AWS and Azure have a massive lead and strong momentum in the marketplace. But the real story is below the line. Unlike Google Cloud, which is on pace to lose well over 3 billion on an operating basis this year, AWS's operating profit is around $20 billion annually. Microsoft's Intelligent Cloud generated more than $30 billion in operating income last fiscal year. Let that sink in for a moment. Now again, that's not to say Google doesn't have traction, it does and Kurian gave some nice proof points and customer examples in his keynote presentation, but the data underscores the lead that Microsoft and AWS have on Google in cloud. And here's a breakdown of ETR's proprietary net score methodology, that vertical axis that we showed you in the previous chart. It asks customers, are you adopting the platform new? That's that lime green. Are you spending 6% or more? That's the forest green. Is you're spending flat? That's the gray. Is you're spending down 6% or worse? That's the pinkest color. Or are you replacing the platform, defecting? That's the bright red. You subtract the reds from the greens and you get a net score. Now one caveat here, which actually is really favorable from Microsoft, the Microsoft data that we're showing here is across the entire Microsoft portfolio. The other point is, this is July data, we'll have an update for you once ETR releases its October results. But we're talking about meaningful samples here, the ends. 620 for AWS over a thousand from Microsoft in more than 450 respondents in the survey for Google. So the real tell is replacements, that bright red. There is virtually no churn for AWS and Microsoft, but Google's churn is 5x, those two in the survey. Now 5% churn is not high, but you'd like to see three things for Google given it's smaller size. One is less churn, two is much, much higher adoption rates in the lime green. Three is a higher percentage of those spending more, the forest green. And four is a lower percentage of those spending less. And none of these conditions really applies here for Google. GCP is still not growing fast enough in our opinion, and doesn't have nearly the traction of the two leaders and that shows up in the survey data. All right, let's look at the next sector, BI analytics. Here we have that same XY dimension. Again, Microsoft dominating the picture. AWS very strong also in both axes. Tableau, very popular and respectable of course acquired by Salesforce on the vertical axis, still looking pretty good there. And again on the horizontal axis, big presence there for Tableau. And Google with Looker and its other platforms is also respectable, but it again, has some work to do. Now notice Streamlit, that's a recent Snowflake acquisition. It's strong in the vertical axis and because of Snowflake's go-to-market (indistinct), it's likely going to move to the right overtime. Grafana is also prominent in the Y axis, but a glimpse at the most recent survey data shows them slightly declining while Looker actually improves a bit. As does Cloudera, which we'll move up slightly. Again, Microsoft just blows you away, doesn't it? All right, now let's get into database and data platform. Same X Y dimensions, but now database and data warehouse. Snowflake as usual takes the top spot on the vertical axis and it is actually keeps moving to the right as well with again, Microsoft and AWS is dominant in the market, as is Oracle on the X axis, albeit it's got less spending velocity, but of course it's the database king. Google is well behind on the X axis but solidly above the 40% line on the vertical axis. Note that virtually all platforms will see pressure in the next survey due to the macro environment. Microsoft might even dip below the 40% line for the first time in a while. Lastly, let's look at the collaboration and productivity software market. This is such an important area for both Microsoft and Google. And just look at Microsoft with 365 and Teams up into the right. I mean just so impressive in ubiquitous. And we've highlighted Google. It's in the pack. It certainly is a nice base with 174 N, which I can tell you that N will rise in the next survey, which is an indication that more people are adopting. But given the investment and the tech behind it and all the AI and Google's resources, you'd really like to see Google in this space above the 40% line, given the importance of this market, of this collaboration area to Google's success and the degree to which they emphasize it in their pitch. And look, this brings up something that we've talked about before on Breaking Analysis. Google doesn't have a tech problem. This is a go-to-market and marketing challenge that Google faces and it's up against two go-to-market champs and Microsoft and AWS. And Google doesn't have the enterprise sales culture. It's trying, it's making progress, but it's like that racehorse that has all the potential in the world, but it's just missing some kind of key ingredient to put it over at the top. It's always coming in third, (chuckles) but we're watching and Google's obviously, making some investments as we shared with earlier. All right. Some final thoughts on what we learned this week and in this research: customers and partners should be thrilled that both Microsoft and Google along with AWS are spending so much money on innovation and building out global platforms. This is a gift to the industry and we should be thankful frankly because it's good for business, it's good for competitiveness and future innovation as a platform that can be built upon. Now we didn't talk much about multi-cloud, we haven't even mentioned supercloud, but both Microsoft and Google have a story that resonates with customers in cross cloud capabilities, unlike AWS at this time. But we never say never when it comes to AWS. They sometimes and oftentimes surprise you. One of the other things that Sarbjeet Johal and John Furrier and I have discussed is that each of the Big 3 is positioning to their respective strengths. AWS is the best IaaS. Microsoft is building out the kind of, quote, we-make-it-easy-for-you cloud, and Google is trying to be the open data cloud with its open-source chops and excellent tech. And that puts added pressure on Snowflake, doesn't it? You know, Thomas Kurian made some comments according to CRN, something to the effect that, we are the only company that can do the data cloud thing across clouds, which again, if I'm being honest is not really accurate. Now I haven't clarified these statements with Google and often things get misquoted, but there's little question that, as AWS has done in the past with Redshift, Google is taking a page out of Snowflake, Databricks as well. A big difference in the Big 3 is that AWS doesn't have this big emphasis on the up-the-stack collaboration software that both Microsoft and Google have, and that for Microsoft and Google will drive captive IaaS consumption. AWS obviously does some of that in database, a lot of that in database, but ISVs that compete with Microsoft and Google should have a greater affinity, one would think, to AWS for competitive reasons. and the same thing could be said in security, we would think because, as I mentioned before, Microsoft competes very directly with CrowdStrike and Okta and others. One of the big thing that Sarbjeet mentioned that I want to call out here, I'd love to have your opinion. AWS specifically, but also Microsoft with Azure have successfully created what Sarbjeet calls brand distance. AWS from the Amazon Retail, and even though AWS all the time talks about Amazon X and Amazon Y is in their product portfolio, but you don't really consider it part of the retail organization 'cause it's not. Azure, same thing, has created its own identity. And it seems that Google still struggles to do that. It's still very highly linked to the sort of core of Google. Now, maybe that's by design, but for enterprise customers, there's still some potential confusion with Google, what's its intentions? How long will they continue to lose money and invest? Are they going to pull the plug like they do on so many other tools? So you know, maybe some rethinking of the marketing there and the positioning. Now we didn't talk much about ecosystem, but it's vital for any cloud player, and Google again has some work to do relative to the leaders. Which brings us to supercloud. The ecosystem and end customers are now in a position this decade to digitally transform. And we're talking here about building out their own clouds, not by putting in and building data centers and installing racks of servers and storage devices, no. Rather to build value on top of the hyperscaler gift that has been presented. And that is a mega trend that we're watching closely in theCUBE community. While there's debate about the supercloud name and so forth, there little question in our minds that the next decade of cloud will not be like the last. All right, we're going to leave it there today. Many thanks to Sarbjeet Johal, and my business partner, John Furrier, for their input to today's episode. Thanks to Alex Myerson who's on production and manages the podcast and Ken Schiffman as well. Kristen Martin and Cheryl Knight helped get the word out on social media and in our newsletters. And Rob Hof is our editor in chief over at SiliconANGLE, who does some wonderful editing. And check out SiliconANGLE, a lot of coverage on Google Cloud Next and Microsoft Ignite. Remember, all these episodes are available as podcast wherever you listen. Just search Breaking Analysis podcast. I publish each week on wikibon.com and siliconangle.com. And you can always get in touch with me via email, david.vellante@siliconangle.com or you can DM me at dvellante or comment on my LinkedIn posts. And please do check out etr.ai, the best survey data in the enterprise tech business. This is Dave Vellante for the CUBE Insights, powered by ETR. Thanks for watching and we'll see you next time on Breaking Analysis. (gentle 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 you know we've often said that the next 10 years in cloud computing won't be like the last ten cloud has firmly planted its footprint on the other side of the chasm with the momentum of the entire multi-trillion dollar tech business behind it both sellers and buyers are leaning in by adopting cloud technologies and many are building their own value layers on top of cloud in the coming years we expect innovation will continue to coalesce around the three big u.s clouds plus alibaba in apac with the ecosystem building value on top of the hardware saw tooling provided by the hyperscalers now importantly we don't see this as a race to the bottom rather our expectation is that the large public cloud players will continue to take cost out of their platforms through innovation automation and integration while other cloud providers and the ecosystem including traditional companies that buy it mine opportunities in their respective markets as matt baker of dell is fond of saying this is not a zero sum game welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll update you on our latest projections in the cloud market we'll share some new etr survey data with some surprising nuggets and drill into this the important cloud database landscape first we want to take a look at what people are talking about in cloud and what's been in the recent news with the exception of alibaba all the large cloud players have reported earnings google continues to focus on growth at the expense of its profitability google reported that it's cloud business which includes applications like google workspace grew 45 percent to five and a half billion dollars but it had an operating loss of 890 billion now since thomas curion joined google to run its cloud business google has increased head count in its cloud business from 25 000 25 000 people now it's up to 40 000 in an effort to catch up to the two leaders but playing catch up is expensive now to put this into perspective let's go back to aws's revenue in q1 2018 when the company did 5.4 billion so almost exactly the same size as google's current total cloud business and aws is growing faster at the time at 49 don't forget google includes in its cloud numbers a big chunk of high margin software aws at the time had an operating profit of 1.4 billion that quarter around 26 of its revenues so it was a highly profitable business about as profitable as cisco's overall business which again is a great business this is what happens when you're number three and didn't get your head out of your ads fast enough now in fairness google still gets high marks on the quality of its technology according to corey quinn of the duck bill group amazon and google cloud are what he called neck and neck with regard to reliability with microsoft azure trailing because of significant disruptions in the past these comments were made last week in a bloomberg article despite some recent high-profile outages on aws not surprisingly a microsoft spokesperson said that the company's cloud offers industry-leading reliability and that gives customers payment credits after some outages thank you turning to microsoft and cloud news microsoft's overall cloud business surpassed 22 billion in the december quarter up 32 percent year on year like google microsoft includes application software and sas offerings in its cloud numbers and gives little nuggets of guidance on its azure infrastructure as a service business by the way we estimate that azure comprises about 45 percent of microsoft's overall cloud business which we think hit a 40 billion run rate last quarter microsoft guided in its earning call that recent declines in the azure growth rates will reverse in q1 and that implies sequential growth for azure and finally it was announced that the ftc not the doj will review microsoft's announced 75 billion acquisition of activision blizzard it appears ftc chair lena khan wants to take this one on herself she of course has been very outspoken about the power of big tech companies and in recent a recent cnbc interview suggested that the u.s government's actions were a meaningful contributor back then to curbing microsoft's power in the 90s i personally found that dubious just ask netscape wordperfect novell lotus and spc the maker of harvard presentation graphics how effective the government was in curbing microsoft power generally my take is that the u s government has had a dismal record regulating tech companies most notably ibm and microsoft and it was market forces company hubris complacency and self-inflicted wounds not government intervention these were far more effective than the government now of course if companies are breaking the law they should be punished but the u.s government hasn't been very productive in its actions and the unintended consequences of regulation could be detrimental to the u.s competitiveness in the race with china but i digress lastly in the news amazon announced earnings thursday and the company's value increased by 191 billion dollars on friday that's a record valuation gain for u.s stocks aws amazon's profit engine grew 40 percent year on year for the quarter it closed the year at 62 billion dollars in revenue and at a 71 billion dollar revenue run rate aws is now larger than ibm which without kindrel is at a 67 billion dollar run rate just for context ibm's revenue in 2011 was 107 billion dollars now there's a conversation going on in the media and social that in order to continue this growth and compete with microsoft that aws has to get into the sas business and offer applications we don't think that's the right strategy for amp from for amazon in the near future rather we see them enabling developers to compete in that business finally amazon disclosed that 48 of its top 50 customers are using graviton 2 instances why is this important because aws is well ahead of the competition in custom silicon chips is and is on a price performance curve that is far better than alternatives especially those based on x86 this is one of the reasons why we think this business is not a race to the bottom aws is being followed by google microsoft and alibaba in terms of developing custom silicon and will continue to drive down their internal cost structures and deliver price performance equal to or better than the historical moore's law curves so that's the recent news for the big u.s cloud providers let's now take a look at how the year ended for the big four hyperscalers and look ahead to next year here's a table we've shown this view before it shows the revenue estimates for worldwide is and paths generated by aws microsoft alibaba and google now remember amazon and alibaba they share clean eye ass figures whereas microsoft and alphabet only give us these nuggets that we have to interpret and we correlate those tidbits with other data that we gather we're one of the few outlets that actually attempts to make these apples to apples comparisons there's a company called synergy research there's another firm that does this but i really can't map to their numbers their gcp figures look far too high and azure appears somewhat overestimated and they do include other stuff like hosted private cloud services but it's another data point that you can use okay back to the table we've slightly adjusted our gcp figures down based on interpreting some of alphabet's statements and other survey data only alibaba has yet to announce earnings so we'll stick to a 2021 market size of about 120 billion dollars that's a 41 growth rate relative to 2020 and we expect that figure to increase by 38 percent to 166 billion in 2022 now we'll discuss this a bit later but these four companies have created an opportunity for the ecosystem to build what we're calling super clouds on top of this infrastructure and we're seeing it happen it was increasingly obvious at aws re invent last year and we feel it will pick up momentum in the coming months and years a little bit more on that later now here's a graphical view of the quarterly revenue shares for these four companies notice that aws has reversed its share erosion and is trending up slightly aws has accelerated its growth rate four quarters in a row now it accounted for 52 percent of the big four hyperscaler revenue last year and that figure was nearly 54 in the fourth quarter azure finished the year with 32 percent of the hyper scale revenue in 2021 which dropped to 30 percent in q4 and you can see gcp and alibaba they're neck and neck fighting for the bronze medal by the way in our recent 2022 predictions post we said google cloud platform would surpass alibaba this year but given the recent trimming of our numbers google's got some work to do for that prediction to be correct okay just to put a bow on the wikibon market data let's look at the quarterly growth rates and you'll see the compression trends there this data tracks quarterly revenue growth rates back to 20 q1 2019 and you can see the steady downward trajectory and the reversal that aws experienced in q1 of last year now remember microsoft guided for sequential growth and azure so that orange line should trend back up and given gcp's much smaller and big go to market investments that we talked about we'd like to see an acceleration there as well the thing about aws is just remarkable that it's able to accelerate growth at a 71 billion run rate business and alibaba you know is a bit more opaque and likely still reeling from the crackdown of the chinese government we're admittedly not as close to the china market but we'll continue to watch from afar as that steep decline in growth rate is somewhat of a concern okay let's get into the survey data from etr and to do so we're going to take some time series views on some of the select cloud platforms that are showing spending momentum in the etr data set you know etr uses a metric we talked about this a lot called net score to measure that spending velocity of products and services netscore basically asks customers are you spending more less or the same on a platform and a vendor and then it subtracts the lesses from the moors and that yields a net score this chart shows net score for five cloud platforms going back to january 2020. note in the table that the table we've inserted inside that chart shows the net score and shared n the latter metric indicates the number of mentions in the data set and all the platforms we've listed here show strong presence in the survey that red dotted line at 40 percent that indicates spending is at an elevated level and you can see azure and aws and vmware cloud on aws as well as gcp are all nicely elevated and bounding off their october figures indicating continued cloud momentum overall but the big surprise in these figures is the steady climb and the steep bounce up from oracle which came in just under the 40 mark now one quarter is not necessarily a trend but going back to january 2020 the oracle peaks keep getting higher and higher so we definitely want to keep watching this now here's a look at some of the other cloud platforms in the etr survey the chart here shows the same time series and we've now brought in some of the big hybrid players notably vmware cloud which is vcf and other on-prem solutions red hat openstack which as we've reported in the past is still popular in telcos who want to build their own cloud we're also starting to see hpe with green lake and dell with apex show up more and ibm which years ago acquired soft layer which was really essentially a bare metal hosting company and over the years ibm cobbled together its own public cloud ibm is now racing after hybrid cloud using red hat openshift as the linchpin to that strategy now what this data tells us first of all these platforms they don't have the same presence in the data set as do the previous players vmware is the one possible exception but other than vmware these players don't have the spending velocity shown in the previous chart and most are below the red line hpe and dell are interesting and notable in that they're transitioning their early private cloud businesses to dell gr sorry hpe green lake and dell apex respectively and finally after years of kind of staring at their respective navels in in cloud and milking their legacy on-prem models they're finally building out cloud-like infrastructure for their customers they're leaning into cloud and marketing it in a more sensible and attractive fashion for customers so we would expect these figures are going to bounce around for a little while for those two as they settle into a groove and we'll watch that closely now ibm is in the process of a complete do-over arvin krishna inherited three generations of leadership with a professional services mindset now in the post gerschner gerstner era both sam palmisano and ginny rometty held on far too long to ibm's service heritage and protected the past from the future they missed the cloud opportunity and they forced the acquisition of red hat to position the company for the hybrid cloud remedy tried to shrink to grow but never got there krishna is moving faster and with the kindred spin is promising mid-single-digit growth which would be a welcome change ibm is a lot of work to do and we would expect its net score figures as well to bounce around as customers transition to the future all right let's take a look at all these different players in context these are all the clouds that we just talked about in a two-dimensional view the vertical axis is net score or spending momentum and the horizontal axis is market share or presence or pervasiveness in the data set a couple of call-outs that we'd like to make here first the data confirms what we've been saying what everybody's been saying aws and microsoft stand alone with a huge presence many tens of billions of dollars in revenue yet they are both well above the 40 line and show spending momentum and they're well ahead of gcp on both dimensions second vmware while much smaller is showing legitimate momentum which correlates to its public statements alibaba the alibaba in this survey really doesn't have enough sample to make hardcore conclusions um you can see hpe and dell and ibm you know similarly they got a little bit more presence in the data set but they clearly have some work to do what you're seeing there is their transitioning their legacy install bases oracle's the big surprise look what oracle was in the january survey and how they've shot up recently now we'll see if this this holds up let's posit some possibilities as to why it really starts with the fact that oracle is the king of mission critical apps now if you haven't seen video on twitter you have to check it out it's it's hilarious we're not going to run the video here but the link will be in our post but i'll give you the short version some really creative person they overlaid a data migration narrative on top of this one tooth guy who speaks in spanish gibberish but the setup is he's a pm he's a he's a a project manager at a bank and aws came into the bank this of course all hypothetical and said we can move all your apps to the cloud in 12 months and the guy says but wait we're running mission critical apps on exadata and aws says there's nothing special about exadata and he starts howling and slapping his knee and laughing and giggling and talking about the 23 year old senior engineer who says we're going to do this with microservices and he could tell he was he was 23 because he was wearing expensive sneakers and what a nightmare they encountered migrating their environment very very very funny video and anyone who's ever gone through a major migration of mission critical systems this is gonna hit home it's funny not funny the point is it's really painful to move off of oracle and oracle for all its haters and its faults is really the best environment for mission critical systems and customers know it so what's happening is oracle's building out the best cloud for oracle database and it has a lot of really profitable customers running on-prem that the company is migrating to oracle cloud infrastructure oci it's a safer bet than ripping it and putting it into somebody else's cloud that doesn't have all the specialized hardware and oracle knowledge because you can get the same integrated exadata hardware and software to run your database in the oracle cloud it's frankly an easier and much more logical migration path for a lot of customers and that's possibly what's happening here not to mention oracle jacks up the license price nearly doubles the license price if you run on other clouds so not only is oracle investing to optimize its cloud infrastructure it spends money on r d we've always talked about that really focused on mission critical applications but it's making it more cost effective by penalizing customers that run oracle elsewhere so this possibly explains why when the gartner magic quadrant for cloud databases comes out it's got oracle so well positioned you can see it there for yourself oracle's position is right there with aws and microsoft and ahead of google on the right-hand side is gartner's critical capabilities ratings for dbms and oracle leads in virtually all of the categories gartner track this is for operational dvms so it's kind of a narrow view it's like the red stack sweet spot now this graph it shows traditional transactions but gartner has oracle ahead of all vendors in stream processing operational intelligence real-time augmented transactions now you know gartner they're like old name framers and i say that lovingly so maybe they're a bit biased and they might be missing some of the emerging opportunities that for example like snowflake is pioneering but it's hard to deny that oracle for its business is making the right moves in cloud by optimizing for the red stack there's little question in our view when it comes to mission critical we think gartner's analysis is correct however there's this other really exciting landscape emerging in cloud data and we don't want it to be a blind spot snowflake calls it the data cloud jamactagani calls it data mesh others are using the term data fabric databricks calls it data lake house so so does oracle by the way and look the terminology is going to evolve and most of the action action that's happening is in the cloud quite frankly and this chart shows a select group of database and data warehouse companies and we've filtered the data for aws azure and gcp customers accounts so how are these accounts or companies that were showing how these vendors were showing doing in aws azure and gcp accounts and to make the cut you had to have a minimum of 50 mentions in the etr survey so unfortunately data bricks didn't make it just not enough presence in the data set quite quite yet but just to give you a sense snowflake is represented in this cut with 131 accounts aws 240 google 108 microsoft 407 huge [ __ ] 117 cloudera 52 just made the cut ibm 92 and oracle 208. again these are shared accounts filtered by customers running aws azure or gcp the chart shows a net score lime green is new ads forest green is spending more gray is flat spending the pink is spending less and the bright red is defection again you subtract the red from the green and you get net score and you can see that snowflake as we reported last week is tops in the data set with a net score in the 80s and virtually no red and even by the way single digit flat spend aws google and microsoft are all prominent in the data set as is [ __ ] and snowflake as i just mentioned and they're all elevated over the 40 mark cloudera yeah what can we say once they were a high flyer they're really not in the news anymore with anything compelling other than they just you know took the company private so maybe they can re-emerge at some point with a stronger story i hope so because as you can see they actually have some new additions and spending momentum in the green just a lot of customers holding steady and a bit too much red but they're in the positive territory at least with uh plus 17 percent unlike ibm and oracle and this is the flip side of the coin ibm they're knee-deep really chest deep in the middle of a major transformation we've said before arvind krishna's strategy and vision is at least achievable prune the portfolio i.e spin out kindrel sell watson health hold serve with the mainframe and deal with those product cycles shift the mix to software and use red hat to win the day in hybrid red hat is working for ibm's growing well into the double digits unfortunately it's not showing up in this chart with little database momentum in aws azure and gcp accounts zero new ads not enough acceleration and spending a big gray middle in nearly a quarter of the base in the red ibm's data and ai business only grew three percent this last quarter and the word database wasn't even mentioned once on ibm's earnings call this has to be a concern as you can see how important database is to aws microsoft google and the momentum it's giving companies like snowflake and [ __ ] and others which brings us to oracle with a net score of minus 12. so how do you square the momentum in oracle cloud spending and the strong ratings and databases from gartner with this picture good question and i would say the following first look at the profile people aren't adding oracle new a large portion of the base 25 is reducing spend by 6 or worse and there's a decent percentage of the base migrating off oracle with a big fat middle that's flat and this accounts for the poor net score overall but what etr doesn't track is how much is being spent rather it's an account based model and oracle is heavily weighted toward big spenders running mission critical applications and databases oracle's non-gaap operating margins are comparable to ibm's gross margins on a percentage basis so a very profitable company with a big license and maintenance in stall basin oracle has focused its r d investments into cloud erp database automation they've got vertical sas and they've got this integrated hardware and software story and this drives differentiation for the company but as you can see in this chart it has a legacy install base that is constantly trying to minimize its license costs okay here's a little bit of different view on the same data we expand the picture with the two dimensions of net score on the y-axis and market share or pervasiveness on the horizontal axis and the table insert is how the data gets plotted y and x respectively not much to add here other than to say the picture continues to look strong for those companies above the 40 line that are focused and their focus and have figured out a clear cloud strategy and aren't necessarily dealing with a big install base the exception of course is is microsoft and the ones below the line definitely have parts of their portfolio which have solid momentum but they're fighting the inertia of a large install base that moves very slowly again microsoft had the advantage of really azure and migrating those customers very quickly okay so let's wrap it up starting with the big three cloud players aws is accelerating and innovating great example is custom silicon with nitro and graviton and other chips that will help the company address concerns related to the race to the bottom it's not a race to zero aws we believe will let its developers go after the sas business and for the most part aws will offer solutions that address large vertical markets think call centers the edge remains a wild card for aws and all the cloud players really aws believes that in the fullness of time all workloads will run in the public cloud now it's hard for us to imagine the tesla autonomous vehicles running in the public cloud but maybe aws will redefine what it means by its cloud microsoft well they're everywhere and they're expanding further now into gaming and the metaverse when he became ceo in 2014 many people said that satya should ditch xbox just as an aside the joke among many oracle employees at the time was that safra katz would buy her kids and her nieces and her nephews and her kids friends everybody xbox game consoles for the holidays because microsoft lost money for everyone that they shipped well nadella has stuck with it and he sees an opportunity to expand through online gaming communities one of his first deals as ceo was minecraft now the acquisition of activision will make microsoft the world's number three gaming company by revenue behind only 10 cent and sony all this will be powered by azure and drive more compute storage ai and tooling now google for its part is battling to stay relevant in the conversation luckily it can afford the massive losses it endures in cloud because the company's advertising business is so profitable don't expect as many have speculated that google is going to bail on cloud that would be a huge mistake as the market is more than large enough for three players which brings us to the rest of the pack cloud ecosystems generally and aws specifically are exploding the idea of super cloud that is a layer of value that spans multiple clouds hides the underlying complexity and brings new value that the cloud players aren't delivering that's starting to bubble to the top and legacy players are staying close to their customers and fighting to keep them spending and it's working dell hpe cisco and smaller predominantly on-plan prem players like pure storage they continue to do pretty well they're just not as sexy as the big cloud players the real interesting activity it's really happening in the ecosystem of companies and firms within industries that are transforming to create their own digital businesses virtually all of them are running a portion of their offerings on the public cloud but often connecting to on-premises workloads and data think goldman sachs making that work and creating a great experience across all environments is a big opportunity and we're seeing it form right before our eyes don't miss it okay that's it for now thanks to my colleague stephanie chan who helped research this week's topics remember these episodes are all available as podcasts wherever you listen just search breaking analysis podcast check out etr's website at etr dot ai and also we publish a full report every week on wikibon.com and siliconangle.com you can get in touch with me email me at david.velante siliconangle.com you can dm me at divalante or comment on my linkedin post this is dave vellante for the cube insights powered by etr have a great week stay safe be well and we'll see you next time [Music] you

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

>> From around the globe, it's the CUBE with digital coverage of Red Hat Summit 2020 brought to you by Red Hat. >> Hi, I'm Stu Miniman, and this is the CUBE's coverage of a Red Hat Summit 2020 happening digitally. We're connecting with Red Hat executives, thought leaders, practitioners, wherever they are around the globe, bringing them remotely into this online event. Happy to welcome back to the program, Joe Fernandez, who's the Vice President and General Manager, of Core Cloud Platforms with Red Hat. Joe, thanks so much for joining us. >> Yeah, thanks for having me. Glad to be here. >> All right, so, Joe, you know, Cloud, of course, has been a conversation we've been having for a lot of years. When I went to Red Hat Summit last year, when I went to IBM, I think last year, there was discussion of moving from kind of chapter one, if you will, to chapter two. Some of the labels that we put on things back in the early days, like Hybrid Cloud and Multicloud, they're coming into a little bit clearer picture. So, let's just give a high level, what you're seeing from your customers when they talk about Hybrid and Multicloud environment? What does that mean to your customers? And therefore, how is Red Hat meeting them where they are? >> Yeah, sure. So, Red Hat obviously, serves an enterprise customer base. And what we've seen in that customer base, really since the start and it's really informed our strategy, is the fact that all their applications aren't going to run in one place, right? So they're really employing a hybrid class strategy, a Hybrid and Multicloud strategy, that spans from their data centers out to a public cloud, typically then out to multiple public clouds as their cloud investments grow, as they move more applications. And now, even out to the edge for many of those customers. So that's the newest footprint that we're getting asked about. So really we think of that as the open hybrid cloud. And you know, our goal is really to provide a consistent platform for applications regardless of where they run across all those environments. >> Yeah. Let's get down a second on that because we've had consistency for quite a while. You look at the largest cloud provider out there, they said, hybrid environment, will give you the exact same hardware that we're running in the public cloud of your bet. You know, that in your environment. Of course, Red Hat's a software company. You've lived across lots of platforms. We're going to Red Hat's entire existence. So, you know, where is that consistency needed? How do you, well, think about how Red Hat does things? Maybe the same and a little different than some of the other players that are then, positioning and even repositioning their hybrid story over the last year or so. >> Yeah. So, we're really excited to see a lot of folks in the industry, including all the major public cloud providers are now talking about Hybrid and talking about these types of initiatives that we've been talking about for quite some time. But yeah, it's a little bit different when we talk about Hybrid Cloud, when we talk about Multicloud, we're talking about being able to run not just in one public cloud and then in a non-premise clients that mirrors that cloud. We're really talking about being able to run across multiple clouds. So having that consistency across, running in, say Amazon to Azure to Google, and then carrying that into your on-premise environments, whether that's on Bare Metal, on VMware, on OpenStack, and then, like I said, out out to the edge, right? So that consistency is important for people who are concerned about how their applications are going to operate in these different environments. Because otherwise, they'd have to manage those differences themselves. I'm speaking as part of Red Hat, right? This is what the company was built on, right? In 20 years ago, it was all about Linux bringing consistency for enterprise applications running across x86 hardware, right? So regardless of who your OEM vendor was, as long as you're building to the x86 standard and leveraging Linux as a base, Red Hat Enterprise Linux became that same consistent operating environment for applications, which is important for our software vendors, but also more importantly for customers themselves as they yep those apps into production. >> Yeah, I guess, you know, last question I have for kind of just the landscape out there. We've been talking for a number of years. When you talk to practitioners, they don't get caught up in the labels that we use in the industry. Do they have a cloud strategy? Yes, most companies have a cloud strategy, and if you ask them is their cloud strategy same today, as it was a quarter ago or a year ago, they say, of course not. Everything's changed. We know in today's day and age, what I was doing a month ago is probably very different from what I am doing today. So, I know you've got a survey that was done of enterprise users. I saw it when it came out a month ago. And, you know, some good data in there. So, you know, where are we? And what data do you have to share with us on kind of the customer adoption with (mumbles). >> Yeah, so I think, you know, we put out a survey not too long ago and we started as, I think, over 60% of customers were adopting a hybrid cloud strategy exactly as I described. Thinking about their applications in terms of, in an environment that spans multiple cloud infrastructures, as well as on-premise footprints. And then, you know, going beyond that, we think that number will grow based on what we saw in that survey. That just mirrors the conversations that I've had with customers, that many of us here at Red Hat have been having with those same customers over the years. Because everybody's in a different spot in terms of their transformation efforts, in terms of their adoption of cloud technologies and what it means for their business. So we need to meet customers where they're at, understand that everybody's at a different spot and then make sure that we can help them make that transition. And it's really an evolution, as opposed to , I think, some people in the past might've thought of as a revolution where all the data centers are going to shut down and everything's going to move all at once. And so helping customers evolve. And that transition is really what Red Hat is all about. >> Yeah. And, so often, Joe, when I talk to some of the vendors out there, when you talk about Hybrid, you talk about Multicloud, it's talking about something you mentioned, it's a box, it's a place, it's, you know, the infrastructure discussion. But when I've been having conversations with a lot of your peers of these interviews for Red Hat Summit. We know that, it's the organization and it's the applications that are hugely important as these changes go and happen. So talk a little bit about that. What's happening to the organization? How are you helping the infrastructure team keep up and the app dev team move forward? >> Yeah, so first, I'll start with, that on the technology side, right? One of the things that that has enabled this type of consistency and portability has been sort of the advent of Linux containers as a standard packaging format that can span across all these different (mumbles), right? So we know that Linux runs in all these different footprints and Linux containers, as a portable packaging format, enables that. And then Kubernetes enables customers to orchestrate containers at scale. So that's really what OpenShift is focused on, is delivering an enterprise Kubernetes platform. Again, spanning all these environments that leverages container-based packaging, provides enterprise Kubernetes orchestration and management, to manage in all those environments. What that then also does on the people front is bring infrastructure and operations teams together, right? Because Kubernetes containers represents the agility for both sides, right? Or application developers, it represents the ability to pay their application and all their dependencies. And know that when they run it in one environment, it will be consistent with how it runs in other environments. So eliminating that problem of, works on my machine, but it doesn't work, you know, in prod or what have you. So it brings consistency for developers. Infrastructure teams, it gives them the ability to basically make decisions around where the best places to run these applications without having to think about that from a technology perspective, but really from things that should matter more, like cost and convenience to customers and performance and so forth. So, I think we see those teams coming together. That being said, it is an evolution in people and process and culture. So we've done a lot of work. We launched a global transformation office. We had previously launched a Red Hat open innovation labs and have done a lot of work with our consulting services and our partners as well, to help with, sort of, people in process evolutions that need to occur to adopt these types of technologies as well as, to move towards a more cloud native approach. >> All right. So Joe, what one of the announcements that made it the show, it is talking about how OpenShift is working with virtualization. So, I think back to the earliest container days, there was a discussion of, "oh, you know, Docker and containers, "it kills VM." Or you know, Cloud of course. Some Cloud services run on VMs, other run on containers, they're serverless. So there's a lot of confusion out there as to. >> Yep. >> What happened, we know in IT, no technology ever dies, everything's always additive. It's figuring out the right solutions and the right bet. So, help us understand what Red Hat is doing when it comes to virtualization in OpenShift and Kubernetes and, how is your approach different than some of what we've already seen in the marketplace? >> Yeah, so definitely we've seen just explosive adoption of containers technology, right? Which has driven the OpenShift business and Red Hat's business overall. So, we expect that to continue, right? More applications moving towards that container-based, packaging and deployment model and leveraging Kubernetes and OpenShift to manage those environments. That being said, as you mentioned, virtualization has been around for a really long time, right? And, predominantly, most applications, today, are running virtualized. And so some of them have made the transition to containers or were built a container native from the start. But many more are still running in VM based environments and may never make that switch. So, what we were looking at is, how do we manage this sort of hybrid environment from the application perspective where you have some applications running in containers, other applications running in VMs? We have platforms like Red Hat, OpenStack, Red Hat Virtualization that leveraged the KVM hypervisor and Red Hat Enterprise Linux to serve apps running in a VM based environment. What we did with Kubernetes is, instead, how could we innovate to have convergence on the orchestration and management fund? And we leveraged the fact that, KVM, you know, a chosen hypervisor, is actually a Linux process that can itself be containerized. And so by running the hypervisor in a container, we can then span VMs that could be managed on that same platform as the containers run. So what you have in OpenShift Virtualization is the ability to use Kubernetes to manage containerized workloads, as well as, standard VM based workloads. And these are full VMs. These aren't micro VMs or, you know, things like Firecracker Kata Container. These are standard VMs that could be, well, Windows guests or Linux guests, running inside those VMs. And so it helps you basically, manage that type of environment where you may be moving to containers and more cloud native approach, but those containers need to interact or work with applications that are still in a VM based deployment environment. And we think it's really exciting, we've demoed it at the last Red Hat Summit. We're going to talk about it even more here, in terms of how we're going to bring those products to market and enable customers. >> Okay, yeah, Joe, let me make sure I understand this because as you said, it is a different approach. So, number one, if I'm moving towards a (mumbles) management solution, this is going to fit natively into what I'm doing. It's not taking some of my traditional management tools and saying, "oh, I also get some visibility containers." There's more, you know, here's my Kubernetes solution. And just some of those containers happen to be virtualized. Did I get that piece right? >> Yeah, I think it's more like... so we know that Kubernetes is going to be in in the environment because we know that, yeah, people are moving application workloads to standard Linux containers. But we also know that virtual machines are going to still exist in that environment. So you can think about it as, how would we enable Kubernetes to manage a virtual machine in the same way that it manages a Linux container? And, what we do there, is we actually, put the VM inside the container, right? So because the VM, specifically with (mumbles) is just a Linux process, and that's what a Linux container is. It's a Linux process, right? So you can run the hypervisor, span the virtual machines, inside of containers. But those virtual machines, are just like any other VM that would run in OpenStack or Red Hat Virtualization or what have you. And you could, vSphere for example. So those are traditional virtual machines, that are now being managed in a Kubernetes environment. And what we're seeing is sort of, this evolution of Kubernetes to take on these new types of workloads. VMs is just one example, of something that you can now manage with Kubernetes. >> Okay. And, help me understand what this means to really the app dev in my application portfolio. Because you know, the original promise of virtualization was, I can just stick my application in a VM and I never need to think about it ever again. And well, that was super helpful when windows NT was going end of life. In 2020, we do find that most companies do want to update their applications, and they are talking about, do I refactor them? Do I make them microservices architecture? I don't want to have that iceberg of an application that I'm just dragging along slowly into the new world. So. >> Yeah. >> What is this virtualization integration with Kubernetes? You mean for the AppDev and the applications? >> Yeah, sure, so what we see customers doing, what we see the application development team is doing is modernizing a lot of their existing applications, right? So they're taking traditional monolithic applications or end tier, like the applications that may run in a VM based environment and they're moving them towards more of a distributed architecture leveraging microservices based approach. But that doesn't happen all at once either, right? So, oftentimes what you see is your microservices, are still connected to VM based applications. Or maybe you're breaking down a monolithic application. The core is still running in a VM, but some of those business functions have now been carved out and containerized. So, you're going to end up in a hybrid environment from the application perspective in terms of how these applications are packaged, and deployed. The question is, what does that mean for your deployment architecture? Does it mean you always have to run a virtualization platform and a container platform together? That's how it's done today, right? OpenShift and Kubernetes run on top of vSphere, they run on top of Amazon and Azure and Google bands, and on top of OpenStack. But what if you could actually just run Kubernetes directly on Bare Metal and manage those types of workloads? That's really sort of the idea. A whole bunch of virtualization solution was based on is, let's just merge VMs natively with Kubernetes in the same way that we manage containers. And then, it can facilitate for the application developer. This evolution of apps that are running in one environment towards apps that are running essentially, in a hybrid environment from how they're packaged and deployed. >> Yeah, absolutely, something I've been hearing for the last year or so, that hybrid deployment, pulling apart application, sometimes it's even, the core piece as you said, is on premises and then I might have some of the more transactional pieces happening in the public cloud. So really interesting. So, how long has Red Hat been working on this? My (mumbles), something, you know, I'm familiar with in the CNCF. I believe it has been around for a couple of years. >> Yeah. >> So talk to us about just kind of how long it took to get here and, fully support stateful applications now. What's the overall roadmap look like? >> Yeah, so, so (mumbles) as a open source project was launched more than two years ago now. As you know, Red Hat really drives all of our development upstream in the open source community. So we launched (mumbles) project. We've been collaborating with other vendors and even customers on that. But then, you know, over time we then decided, how do we bring these technologies to market, which technologies make sense to bring the market? So, (mumbles) is the open source project. OpenShift and OpenShift Virtualization, which is what this feature is referred to commercially, is the product that then we would ship and support for running this in production environments. The capabilities, right. So, I think, those have been evolving as well. So, virtual machines have a specific requirements in terms of not only how they're deployed and managed, but how they connect to storage, how they connect networking, how do you do things like fencing and all sorts of live migration and that type of thing. We've been building out those types of capabilities. They're certainly still more to do there. But it's something that we're really excited about, not just from the perspective of running VMs, but just even more broadly from the perspective of how Kubernetes is expanding to take on new workloads, right? Because Kubernetes has moved far beyond just running, cloud native applications, today, you can run stateful services in containers. You can run things like AI and machine learning and analytics and IoT type services. But it hasn't come for free, right? This has come through a lot of hard work in the Kubernetes community, in the various associated communities, the container communities, communities like (mumbles). But it's all kind of trying to leverage that same automation, that same platform to just do more things. The cool thing is, it'll not just be Red Hat talking about it, but you'll see that from a lot of customers that are doing sessions at our summit this year and beyond. Talking about how, what it means to them. >> Yeah, that's great. Always love hearing the practitioner viewpoint. All right, Joe, I want to give you the final word when it comes to this whole space things kind of move pretty fast, but also we remember it when we first saw it. So, tell us what the customers who were kind of walking away from Red Hat Summit 2020 should be looking at and understanding that they might not have thought about if they were looking at Kubernetes, a year or two ago? >> Yeah, I think a couple of things. One is, yeah, Kubernetes and this whole container ecosystem is continuing to evolve, continuing to add capabilities and continue to expand the types of workloads, that it can run. Red Hat is right in the center of it. It's all happening in open source. Red Hat as a leading contributor to Kubernetes and open source in general, is driving a lot of this innovation. We're working with some great customers and partners, other vendors, who are working side by side with us as well. And I think the most important thing is we understand that it's an evolution for customers, right? So this evolution towards moving applications to the public cloud, adopting a hybrid cloud approach. This evolution in terms of expanding the types of workloads, and how you run and manage them. And that approach is something that we've always helped customers do and we're doing that today as they move out towards embracing a cloud native. >> All right, well, Joe Fernandez, thank you so much for the updates. Congratulations on the launch of OpenShift Virtualization. I definitely look forward to talking to some the customers in finding out that helping them along their hybrid cloud journey. All right. Lots more coverage from the CUBE at Red Hat Summit. I'm Stu Miniman ,and thank you for watching the CUBE.

>> Announcer: Live from San Diego, California, it's theCUBE! Covering KubeCon and CloudNativeCon. Brought to you by Red Hat, the Cloud Native Computing Foundation, and its ecosystem partners. >> Welcome back. I'm Stu Miniman, my cohost, John Troyer, and this is theCUBE's fourth year of coverage of KubeCon, CloudNativeCon 2019. We're in here San Diego and happy to welcome to the program a first-time guest, Amr Abdelhalem, who is the head of Cloud Platforms at Fidelity Investments. Of course, Fidelity, we love talking to an end user. Big financial company. Your boss was up on the main stage in front of 8000 people, just in that room, there's over 12,000 here in person. Fidelity itself, you know, founded in 1946, first computers in 1965. In the last year, you've now got over 500 applications running in the public cloud, and Fidelity also joined the CNCS. So let's start there, Amr, if we would. Just kind of how does Fidelity look at kind of Kubernetes and CNCS? How does that fit into your company's mission? >> Absolutely, I mean thank you so much for inviting me here. Innovation in Fidelity is, a big part of the process. We're very focused at this time in cloud computing and machine learning, NEI technology. We had the first financial robot in 2015, I believe. We have the first augmented reality financial advisor, was actually released this year as a prototype. So a part of that innovation, we're seeing, CNCF and cloud computing and Cloud Native, is keys for strategy for our innovation part. >> All right, maybe if you could, give us a little bit of the breadth and depth of your team, what they cover, cloud platforms. What does that mean inside of Fidelity? >> Sure, so Fidelity had over, like, over 10,000 of IT. Hundreds and hundreds of develop teams, thousands of applications. It's globally distributed. It had all kind of workloads, that you can imagine. And it's in a highly regulated environment as well. And that's where we are seeing that we are all looking for this autonomy between teams, and agility, and improved time to market and customer experience. And the key for that is Cloud Native. We're seeing Kubernetes and CNCF and Cloud Native technology is like a key player for us when we go, multicloud to hypercloud model. >> Can you talk a little bit about more into that portfolio of technologies? You know, there's a lot of talk about public cloud verses on-prem, and, as if one thing is going to, one knife is going to be the only thing you need in your kitchen. >> Amr: Right. >> So you have a portfolio of platforms, you have a portfolio of destinations and a portfolio of applications. Can you talk a little bit, both about what you're using, and maybe how you're organized to access and address all those needs? >> Absolutely. So, I think, 2019, I would say, is the year of multicloud-hypercloud modeling, right? Actually, I would say that 2020 is going to more about distributed cloud, where you can distribute your workload across multicloud providers. We're not there yet. I don't think we're, anyone, is there yet. But at least we should start somewhere. We already has this multicloud providing. Distributing the workload itself between, I mean, it's a journey to move thousands of applications and thousands workloads and data as well, between on-premises data centers to a public cloud. You need to move through this journey of hypercloud models. And be able to move apps slowly and aggressively to other apps. >> All right. Amr, I want to dig into what you talked about there, multiclouds. >> Sure. >> So when you talk about multiple clouds, yes, everybody has that. I've got, walk us through a little bit, you know, where you have workloads and how many public clouds you use in life, but I want to set you up with a premise. You know, we really said, for multicloud to really be a reality-- >> Amr: Right. >> The value that you extract should be greater than the sum of its parts. And most of us lived through the multi vendor years, and that wasn't necessarily happiness and joy, when I had to span between those environments. So how do we make sure that multicloud doesn't become the least common denominator or a detriment to what I need to do with my data, my applications, the value that the company has? >> And that's why we are here. We are actually incorporated at Kubecon for that reason. That where we see this abstract layer that guarantee you the portability for moving your application from one cloud provider to another. That capability of the ability to deploy the same workload into multiclouds, the ability to have the workload itself, managed in different characteristic, next to assess services that you will find in AWS via Azure, via Google Cloud, the others. That's were we need that flexibility, and Kubernetes and Cloud Native itself, the ability to have the same deployable structure for your application, the ability to have the same ecosystem around that construction, around that artifact. The ability to move all of that, as-is, from one cloud provider to another cloud provider is big, big key. And that you can only find with script native. >> All right, Amr, can you share which cloud or clouds you're working on today, and what is your roadmap, do you have a timeline to when that vision becomes reality? >> At this moment, we're with a major cloud provider keys that, you guys can name them, all the colors. >> Stu: You're using all of them, okay. >> All the colors. >> And how are you using Kubernetes today? Where are you in that journey? >> So Kubernetes is mainly, I mean, I would say the majority is still running on premise. We are very intensively moving to public cloud in the Kubernates side. At this moment, actually, we're building an offer, inside my team, which is a cloud platform team. That offer will guarantee that portability between all the cloud provider. So for development team to port our platform, it will be kind of seamless for them, where it's going to land, is it going to be landing in AWS or Azures or on premise. >> Okay, joining the CNCF as a member, bring us inside. I understand the journey. Are there any specific goals you have? How do you measure the investment, and what you're hoping to, both as a company as well as part of the community, get out of it? >> So we have a big hold right now and opensource our project our little project about multiclouding, and our focus is mainly about the high regulation part. We're very focused in compliance and security, and in that way we can, I think, we can contribute back to the open source community around that. >> So Amr, you talked about, you know, we talked about the platforms here, and Kubernetes, but that goes hand-in-hand with the culture, and the up-skilling, and the organization and the processes. What intrigued me is you said, well, we put some things on Kubernetes on-prem, and then, and you know some things in the cloud, but then we're going to move some of those apps over time, we'll move to other appropriate homes. So that implies that you've changed process and you've changed, or maybe to be able to build cloud native apps, and that was actually separate, in some cases, from being in the public cloud. Is that the case, can you talk a little bit about how you've approached from the perspective of people who are listening or watching who are IT admins, and wondering how a company, a major organization, like your org, gets there? >> Right, and this is a main challenge. The challenge is not in the technology side itself, or the tools, that seems a majority there in the ecosystem at this moment. The challenge is mainly building the sculpture inside teams. So we're building many like, star-point or COEs across all of our business unit and all of our teams. And again, to build a sculpture across 10,000 developers plus, that's a major. >> And it's funny, because sometimes people go, well, COE is a dirty word, right, don't do a COE, but you said multiple COEs distributed across. >> So it's like nuclear reaction, our COEs, the first one, that will communicate with few COEs, each one of them would be with other COEs, and that's how that chain will go and expand quite quickly. >> All right. >> And this is happening at this moment. >> So, Amr, I have a few friends that this is the first time that they've come, and they go into the keynote, or they look at the schedule, and they're a bit overwhelmed. >> Amr: Right >> They say, it's not just Kubernetes, there's dozens and dozens of projects. The ecosystem is sprawling. If you could, give us a little walkthrough as to, the projects you're using, any key partners that you're allowed to talk about that are useful in helping you to achieve your mission. >> So, we're very focused at this moment, actually, in the Kubernetes project itself. We start exploring some of the open source project and in the CICD part, additional to that, we are starting using few frameworks like Flux, this is one of the frameworks like GitOps in general, building this culture of GitOps deployment, and moving toward, like, more ops of deployment, that's one of areas that we are very invested in. We're exploring service mesh at this time, and I hope like, we're going to get, like, maybe next year we can talk about service mesh more. >> Yeah, is there something that's holding you back on service mesh, 'cause there's a few options out there at various maturity levels, and who's driving them. What will some of your criteria be? >> I would say it's mainly, I'm waiting little bit more, I feel like 214 for me, when we had that discussion, instead of sitting here, 214, you will be discussing Mesos via Kubernetes via Swarm. So I think we are still moving at this time, service mesh as well. >> Any partners that you can speak to from a technology standpoint that are helping you, that you're allowed to talk about? >> Amr: Well, I mean, first of all CNCF. >> Yeah. >> I greatly appreciate all their help in that. Most of the public cloud providers are helping us in this areas as well, yeah. >> I'll be interested in catching you after the show and seeing how you thought, I mean this is, in some ways, it's a science project a few years ago, and now it's this robust thing. Did you bring, I'm curious, did you bring mostly engineers, mostly managers, a mix of the two? >> Amr: Mostly engineers, yeah, mostly engineers. >> Hands on? >> All hands on, I mean, this is like another change in culture right now, where most of our engineers are in innovation, like, they are full stack engineers. We're using VDI process at this moment, to move forward. All our road maps, in turn, have been published, it's being used like evolving process, to go, like, with continuous deployment, and continues feature enhancement for the teams. So it's fantastic honestly, yeah. >> Okay, Amr, what things does your team hope to achieve this week, anything that is on your roadmap, or on the public open source road map that you're waiting on? We talked a little bit, service mesh? >> We're definitely exploring OPA at this moment. I think that's like, that's big potentials there. So that's one of them, yeah. I think going through that showroom and try to see what option we have as well, that's on the area where we going to be very interested at. >> OPA, the Policy Agent, I mean, you talked about compliance before >> Yeah. >> A few years ago, with folks in the financial industry, you would have some arguments, some discussions, sometimes heated discussions about security in the cloud and et cetera and highly regulated industry, yet, kind of, maybe ironically or somewhat, maybe surprisingly for some, right? Very advanced in many areas, the whole industry. That's well known if you're in it. Do you still have to have discussions about compliance and security in the cloud? Maybe, I guess, maybe when you talk about data locality and international borders more? >> Right, and that's why we already have our own policy management tool, which is built in, we build it ourself, and that's where I see the potential, like, our moving from building it yourself to more of using an open source project and try to reuse it and contribute back to that open source community, like something like OPA, for example. So that's the next generation, where I can see it will help us as well. >> Amr, any advice you'd give your peers out there, if they're new to the community? Things you've learned along the journey so far? >> I would say start small, don't boil the ocean. Start with small COEs, small pilots program. Look for success, look for goals. Technology is great, but don't just move toward technology, because it's a moving target, it will never end. Try to set business goals for you, like targets for your project, and that's how you can achieve success. >> Well, Amr, really appreciate you sharing Fidelity's update. >> Thank you. >> Wish you and your team the best of luck here at the show and beyond, and we definitely hope to catch up soon. >> Thank you, I appreciate it. >> All right, for John Troyer, I'm Stu Miniman, be sure to checkout theCUBE.net for all of the coverage of this, as well as all the cloud, Cloud Native, and more shows that we have. Thank you for watching theCUBE. (upbeat electronic music)

>> Announcer: From our studios in the heart of Silicon Valley, Palo Alto, California, this is a CUBE Conversation. >> Hello everyone, welcome to theCUBE Conversation here in Palo Alto, California, theCUBE Studios, I'm John Furrier, host of theCUBE, we're here with Reinhardt Quelle who's the principle engineer, Cloud Platforms and solutions Group at Cisco. Reinhardt, thanks for coming in, good to see you. >> Reinhardt: Thanks for having me. >> So, technical conversation around Cloud is something that we love having. We've seen the evolution over the past decade, Cloud 1.0, compute, storage, greenfield, cloud opportunities, great SaaS applications being built, you've built apps for over a decade, SaaS apps. >> That's right, I've been delivering applications, both to data centers and then of course, later into Cloud for a number of years. >> So you got some scar tissue. You have some successes, you've had some struggles, probably with on-prem, but the world's changed a lot and again, we've been covering this a couple years now. We saw public Cloud, all the benefits, no questions, great, you can lift and ship stuff up there, no problem, but the complexity's still there and now the trend is everything's shifting back to on-prem with Cloud. So now the hybrid model has been validated, Amazon Outpost, Anthos in Google, Azure Stack from Microsoft, clearly this mold, all the cloud vendors are telegraphing, they are doing it, this is a reality, this has been validated. >> Yeah, I think that's no surprise to those of us who've been deploying for a number of years. We've always had data centers where we're running our applications in data centers, and yes we started taking that into the Cloud, but there was always components of our infrastructure that continued to run on-prem, whether for historical reasons, for data gravity reasons, policy reasons, any number of reasons, but what we did learn was how to operate our applications differently and so for the last number of years, we've been moving a lot of the advantages of that Cloud back to on-prem. >> So I want to get your thoughts as principle engineer and look at the overall Cisco holistic portfolio of products because Cisco is a standard in the enterprise, every big company has Cisco gear at some level form of another. You've been dealing with networking for years, but now that networking becomes so much more acute issue because you still got to move packets around, another abstraction layer does networking, security, networking, all tie in to the growth area that is now this next generation of Cloud, Cloud 2.0, intelligent edge, data center on-prem, what's the Cisco story? Why Cisco, why now? What's the story? >> Well the amusing thing, of course, is the Cloud doesn't exist without networking. The very first thing when you set up an Amazon-- a compute in Amazon, you set up a virtual private network and you start deploying into that network, so it's always been true that networking is at the core of Cloud. And so the complexity that we're seeing over time is that the workloads are everywhere. The workloads aren't just in my data center and I'm not paying attention to data center networking or just cloud networking, it's connecting them together, securing them, making sure that they're fast and well managed. And so it's always been true that networking's at the core of this and as the edges get blurry, as we move workloads from one place to the other, all of the things that Cisco does are on managed networks, programmable networks, secure networks, all become even more important. >> And everything's amplified, too, in terms of its purpose. You're seeing automation is a big trend that's impacting the infrastructure and app developers. You've deployed SaaS apps within Cisco for over a decade, you've seen your share of successes and its issues but now as the data becomes critical, you got security perimeter issues are gone, and you got Surface here with industrial in IOT it's only getting more complex. So the complexity never went, but it's still complex these are the same problems. What's changed, what's the-- what's going on? >> Well so one of the things that's changed is that we've-- and this is something we can credit the Cloud providers for doing it is we've learned to treat our infrastructure in a different way. I mean the way we deploy and manage everything including networks compute, even applications. Operating the cloud demanded that we automate those things. Demanded the way, when you're managing now, fleets of thousands or tens of thousands of machines at scale in the cloud and when your call provider won't promise you that any machine won't go away at any moment you get good at replacing machines. And now we take those same tools, concepts, ways of operating that we did on the cloud and we apply them on print. Yeah, so a big part of what Cisco has been doing across our entire portfolio is ensuring that every piece of it from networking storage security is programmable and drivable through automation. >> You and I were talking before we came on camera and I wrote this down a phrase you like to use is, referring to Cisco, why Cisco is, We bring cloud innovation on-prem, what do you mean by that? >> Well really it's taking these new way of doing things, these new opportunities. Yeah, when we talk about-- we've had some funny conversations with our security guys, for example, we're historically in security we would have some policy, we would deploy applications against that policy once every six months or twelve months we would audit against that. Well one example of bringing the cloud innovation on-prem is the way you deploy that software, or deploy a new policy is via software. So auditing that is checking your code before you commit it, this says what it's going to do. Running reporting on the things that you've deployed so that you can see. So its taking these advantages of automation, and observability, and things like code review that are just normal practice in software development and apply them to infrastructure. And so, again, what Cisco is doing is making sure that all of our infrastructure can be-- can be programmed in that way, providing tools that allow us to program the things like Network Services Orchestrator or CloudCenter Suite that allow us to deploy applications or networks or whatever else as software entities . >> How about the reality of the person who's been innovating in the cloud and their reaction when they come back on prem they go, okay I've been doing this in the cloud and I turn around and I see all this. Is this the cloud innovation dynamic that you're referring to? Is it the realization that I had some innovation in the cloud, agility, automation and then trying to figure it out, or applying it, or both what's the reality when someone goes wow, I'm on-prem now, what's that innovation layer? >> Well there's several realities, depending on who you are and where you're coming from. One of my first roles at Cisco was, I was working on the Webex operation team and that-- the way we ran that operations was typical of the time it was built. And we did an acquisition that to accompany-- of a company that had been operating in Amazon and when they saw the way we that had to deploy and manage their application and infrastructure they were horrified. It's like, what do you mean I can't deploy a server in five minutes, what do you mean I can't manage the workflow in this way? So for them it was a shock and horror that they didn't have this infrastructure and that's when we deployed our first private cloud and Webex was to support that style of deployment. The flip side of that is the people who are operating those existing data centers with those existing workflows, their world changed, I mean they had to learn new ways of doing things, they had to learn new ways of managing their infrastructure, coding skills were a requirement not something that a few guys did, scripting in the background. So it was like, there's a lot of change to the people and to the way we did things but really it's a matter of bringing those, you know, bringing the cloud, bringing software development to operations, bringing software programmable to, hard programmability, to hardware. >> Yeah, I mean that's a great point. We cover that a lot on theCube, but I think one of the things you pointed out is the realization that, okay, great, new way of doing things, innovation. But as you kind of pointed out, there's a double edged sword there. The command and control of the network, which has been an old style tactic which doesn't go away, you still need to have control of certain things and on-premise, you certainly can control it on-premise, on cloud you think you control it through software, but this is the deep dive on tech conversation I want to have with you because we're talking about app deployment, Kubernetes management and the reality, I have my own gear on-site, as well as I'm maybe serverless into the cloud, this is the new reality. That you have to manage the controls. Take us through the-- those layers. App deployment, Kubernetes, and the reality of managing infrastructure on a future basis. >> Sure so, it's-- when we think about the application deployment it's very easy to kind of think about it in terms of the layers, and the programmable layers that you provide and I'll just touch--we won't go into detail on the products, but ultimately, today for an application-- someone deploying an application increasing that means push an application into Kubernetes, in other words I'm going to package my application's container, I'm going to hand it to Kubernetes through Kubernetes API and I'm going to expect Kubernetes to do the deployment and management of that. Okay, so that just makes the problem for the guy one layer below you, where's Kubernetes come from? It's like who deploys and manages Kubernetes? And so there's a number of different solutions and the public cloud you can use, you know, AKS, or Google's Kubernetes service, or Amazon's, any of these, but on-prem, where's it come from, who's going to manage it for you, who's going to create that? So Cisco's container platform is a product to deploy and manage Kubernetes to offload that from the developer, I mean, from the operations guy or the platform manager. Of course, that deployer of Kubernetes expects programmable infrastructure, how are you going to be able to deploy a VM or manage hardware that runs below that? >> Back to your innovation message. It's the innovation they want >> Well ultimately the guy wants the simple push the button and get the application deployed, that means someone has to get this layer deployed and well to get that layered deployed, what's there? So we continue to support virtualization managers, whether VMWare or our own cVim, Cisco Virtual Infrastructure Manager. All of these products its like, how do I manage this pool of hardware to provide that next layer of service? So, but in every case the programmability of the infrastructure or as far down as you can go becomes paramount, so, you know, when the guy racks a piece of hardware in the data center he doesn't want to think about how does this read card need to get configured, right? He just wants to rack it, plug it in, and then turn it over to software as quickly as possible. >> And that's the cloud innovation on-prem that you're referring to, that's making it cloud-like operations for Agility Automation, provisioning. >> Consistency, reliability, observability, give you an example of that, I mean when we, when we were talking originally when we were starting these cloud deployments and we had this conversation with Infosac about which application lives in which zone and how do you manage that? And we were like, well the zoning processes that's used in the past don't apply anymore. The way we manage that thing is with security groups, and the security groups are created this way. Here's the software, here's the software. When I'm talking software, I'm talking about configuration and scripts in this case, Ansible, Chef, Puppet whatever, that generate those security groups that generate those rules and it's like, it changes the way the security guy interacts with your team. It's no longer, file a ticket to review your app and app deployment and have a new ticket to do a deployment, it's something that they can do in real time. We're talking about moving these processes left, you know, moving that audit to the system all the way back into the software development stage and then giving the tools to verify that afterwards. And their eyes literally popped open, it was like, you mean at any moment at any time I can say show groups and see what the security posture is right now. And it's like, yes! An that's what sold them on letting us behave in this new way, was the ability to audit in realtime. >> Yeah, and this is a major advantage. This brings up the question that comes us all the time, and I want to get your thoughts on this because this shapes into the overall cloud architecture, cloud portfolio, and in this case with Cisco products is workload portability. It used to be, oh the one way trip to the cloud, not anymore, it's not a one way trip to the cloud, it's now bi-directionally on-premise, been validated by LPOST, Anthos, and Azure Stack, this is going to be an operating model to your point about the cloud innovation now workload portability, I think that's been validated so I think we recognize, the industry recognizes that it's not just public cloud everywhere, it's hybrid. This has been validated. You agree. >> Absolutely we-- there were many things that we never did move to the cloud, never would move to the cloud. Whether it's for policy reasons, or the quantity of data that we had, or systems that weren't available on the cloud, for example DevTest Labs, that have soundproof rooms, it's all audio equipment. We sell phones, we have to test those phones, those aren't ever going to be on the cloud, they're going to be in their soundproof rooms so we can test the audio pairing. There's stuff like that that always lives unrolled. There's a myriad of-- >> Compliance resources also requires-- >> Compliance things, whether its a FedRAMP compliance, this data has to be in this country, well US in that case, European privacy things. It could be-- I was talking to one bank a number of years ago now that worked-- we're deploying, we're talking about deploying Kubernetes from, it's like what applications are you deploying? Why do they need to be here, well, they're building-- they've got a mobile first application they want to use all the latest and greatest ways to build and deploy that application. But the data that that application is accessing is in the mainframe. It hasn't moved in ten years, twenty years, it's not going to move anytime soon. So you put the application next to the data that it needs. An IoT, it might be control devices, or video devices, or any number of things that's like, I think there's a trend overall, it's less about workload portability for a lot of people or being able to move workloads, it's saying, where's the best place for this particular workload to run, and so then provide the appropriate infrastructure to run that workload. And that's where we get back to saying, wait a minute I want to use containerization, I want to use orchestration systems, I want to use all these modern tools for doing this, but still put the workload where it needs to be. >> That is a profound statement, I want to just quickly unpack that a little bit because that really is the heart of the issue, cloud innovation. The workloads are going to be defining the requirements it needs, whether it's cloud selection or where it resides on-prem with what resources underneath it. That's not saying a company has to decide that because of that workload that the entire company has to use that 'cause the choices now because of the levels or granularity that cloud brings, the applications can get almost custom built or-- well not custom built but a specific hardware and compute to serve their needs. So if its a-- you're soul sourcing a set of resources for the workload. That's not saying that the infrastructure has to be that for everything, it's just the whole single cloud versus multi cloud dynamic. >> Yeah I mean, in fact, one of the things we're seeing more and more in our customers is, like, they don't have one cloud, they have multiple clouds, for multiple purposes. On-prem there's not one big private cloud that runs everything, there's lots of Kubernetes clusters and one of the things that a product like CCP does is allow you to deploy and manage multiple Kubernetes clusters for multiple purposes. Multiple problem domains, multiple political domains, financial domains, who's paying for this thing? Well, it's easy if you just buy the servers that are appropriate to your department and you run it. You still get to take advantage of all the way you deploy and package and run these applications, which is just hands down better than we ever did before. And that's some of the innovation we have. Now once you start doing this, once you start deploying these applications in multiple places, in multiple-- well, where are your security borders, where are your perimeters, how do you secure any of this, how do you connect all this stuff? How do you visualize all this stuff? And so, as you look at our products from, you know, we talked a little bit about the infrastructure pieces of that, you know the, Kubernetes deploying to an infrastructure manager, deploying ultimately to hardware, every layer of that. You know, UCS and CVIM and CCP, all of those layers are there and programmable. Okay, now we're deploying workloads, now I've got to connect the things together, how do I monitor it, how do I-- and so that's why you see products like Stealthwatch Cloud, and AppD, and the other applications to do monitoring and security across a now fully distributed application. >> You know, sometimes it's hard for me as a cube host to kind of get the story out about certain trends, especially when big players like Cisco, a lot of people know that I'm pretty bullish on Cisco, I've been very vocal about the Cisco opportunity with respect to cloud and critical, by the way in some areas and I think I would probably advise certain things to be certain ways. But one of the things, I think, is a great opportunity that you guys have, and you're kind of getting at, I want to just get your reaction and thoughts on this, is that what you're talking about here is an environment that's going to be constantly dynamic. That's constantly changing. And being complex is not going away, abstracting away the complexity is the game. But Cisco has always been successful in multi environments, different environments because networking has always been about diversity of networks. Campus this, and SD-- so it's not a new concept for Cisco to deal with this concept of multiple environments. Do you agree with that? What's your reaction to that? How would you answer that? Is that something you think Cisco's dominating in? Is that reason why Cisco is serving all these choices? What's your thoughts on that? >> I would have to say that overall the integrating lots of disparate things. Connecting lots of disparate things is in Cisco's DNA, I mean from our original routers and switches at the very beginning it was always multiple things connected to each other often multi-vendor working across standards and across standard things. When we talk about Kubernetes we're not talking about the Cisco Kubernetes we're talking about Kubernetes, the real thing, the actual Kubernetes, we're talking about-- and we're talking about ceiling, we're talking about openstack a standard, we're talking about-- so across all these boards connecting and integrating disparate things, is kind of what Cisco does. >> And so if you're deploying applications you've done that and certainly your customers are, they're never going to have one general purpose situations that's going to be scenarios, right? And certain things will be guiding principles, some will be governors that will then dictate things that might not be classic cloud native. Can you talk about that and give some examples why that's important and the reality of the statement. >> Yeah so, just use one example of an application, Webex teams our enterprise chat application, for example, that is your classic microservices modern cloud native application. There are three ways of deploying applications in that platform that are appropriate for the three different things. We got the services themselves, the media bridges, or the switching engines that runs these containers in a container orchestration fabric. There's the VM base things that are things like media bridges that don't run in containers very well, not because of the problem with the containers, but because of the overlay networks the containers bring with it and the way you route data to those. And we got physical machines. Now when we're actually running certain things on physical machines and so all of these exist in any kind of, even a brand new modern application so even within a single product family there's not one true way of doing things, what's the appropriate way to deploy this application. What's the right deployment target for this thing and how do I connect these things. >> You measure InfoSec so politics might be a driver that have nothing to do with technology, could be a human capital, resource issue, it could be something scalable. >> And the politics or even or can be even these temporal things, it's like, look I can spend, you know, three weeks trying to convince an InfoSec to do things in a particular way or it can just deploy somewhere where it makes them happy and move on, move on to the next problem and then later when they catch up with the way we're doing things, we may move it later. The other thing about timing on all this is the story is changing constantly when we deployed that application, we did not use Docker containers. And everybody says, why aren't you using Docker? Because Docker didn't exist three years ago! It's like the decisions we were making at that time are changing ever more rapidly. And the reality for our enterprise customers is that you don't just forklift one and then replace it with another one, you tend to manage them all in parallel even as you're making transitions, you know, eventually you kind of get rid of the old stuff, maybe, the mainframe still exists >> Mhmm. >> But in general for most of our enterprise customers it's not and or it's not on-prem or on the cloud, it's not containers or visible machines, its and, I'm running all of the above. >> And to your point about the docker not being around when you guys were doing that, that's going to be a concept that's going to be applied down the road, hey that wasn't around when we set the architecture, so as an enterprise, your customers that you talk to, what is the guiding principle? What is the preferred architecture? Again, a lot of choices you guys are trying to make your portfolio fit the bill. What are some of the decisions they have to make? So, to future-proof because they don't want to foreclose an opportunity and or create technical debt for that matter. Why would they do that? So they kind of have to be holistic in their thinking. >> Yeah, future proof is always-- is a funny concept because the reality is, that the... The way you do things will change. You didn't make something that was future proof, you built an environment that allowed you to do this way and that way. So if you take a look at the way we deployed, for example, our infrastructure in general we start with the UCS substrate, we can run Oracle on bare-metal on those things when we need to. We can run virtualization on top of that, and run a layer of vms on top of that. We can run containers, now I've got choices. Common substrate, common way of managing those things but at least three different ways of deploying on those. So ultimately we're looking for standard practices that enables me to have to do the and to where I can run things side by side and can connect things, I can secure things over the top but run all of the above. And it's really a matter of building things that have kind of clean our connectural layers where one thing consumes the other and then be able to mix and match and plug them together Lego style as it were. >> This a great chat, and really reminds me of the conversations that we'll be having here in theCube. We've been doing a series with engineering leaders and you know, you mentioned foreclose in the future, future proofing which is kind of a buzz word. The conversation happening in the technical circles is about technical debt and I think, you know, I've always seen that enterprise you know, cost of ownership, you know, and the shark fin, the iceberg and what you don't see. Certainly that's been a paradigm that's been known but now you're getting into this notion of not just so much future proofing, it's really the balance of technical debt because you know something new is coming. This is a modern concept that takes costs of ownership and future proofing and kind of puts it to reality because you're essentially taking on some sort of technical debting from point A to point B, but you don't want to take on too much that you can't pay it back if new technology comes in. So this is what's been going on in some of the you know, top customers that we've been talking to. A new management concept, this is kind of a modern new management discipline. Your thoughts and reaction to that? >> So there's at least two different vectors that talk about on it. So, one of the things is, how do I take these older applications, these older ways of managing things and incrementally improve them. Because we can actually make it-- it is easier today to deploy a process running on a machine than it ever was before. Five years ago I would have a ticket, some guy would go and then install software manually, today we don't do that, we use configuration management, puppet and chefs, ansible, etc. We improve the way I do those things incrementally rather than just forklift them. I'm not rewriting these applications and saying okay, we're going to make these into cloud native applications and microservices and bla, bla, bla and replatform them. No I incrementally improve the way I operate that thing. Even if its just deploying the hardware more consistently underneath or improving this layer. So I incrementally reduce my debt by applying, again, deploying some of these new cloud... Cloud innovations, they're grown out of the cloud to the existing ways of doing things. But the other point I'll make on a lot of this, is that, certainly for our team, and for a lot of the customers I talk about we don't just arbitrarily go and replatform things, right? It's like if the thing is working, let it continue to work. Don't deploy the new thing alongside it. You know, we're more concerned about delivering new features, new capabilities, new things. And we do that, and we concentrate our efforts and our engineering efforts on that and not constantly rewriting the past. >> A container can certainly help you there too. >> Absolutely. Containers are beautiful tool for that, for encapsulating dependencies around a thing. And so you'll find in many cases we have applications that are not ready to deploy to run in Kubernetes with a schedule that's going to move it around but I can still take advantage of the container packaging and run it on a physical box with a normal Linux operating system and containerize it. So it's usually valuable. >> Reinhardt, I want to get your thoughts on one last talking track, that is relevant to something that we've been covering. Stu Miniman, co-host of theCube with me on many of these events around networking, we both love networking, both networking nerds. Always joke about how networking is where you go to find out about the state of the industry is. Look at what's going on with the network. Because network ultimately tells the truth. Movin' things around, security people go to the network. You start to see, everything's revolving around the network now, more than ever. I mean, still, it's been that way forever. But you made a comment before we went on camera you said, just adding another layer of networking. If you think about what you just said, the networking paradigm is just kind of slowly moving to another layer. So networking is happening, it's just happening differently. So as the dev ops innovations in the cloud happens it's really a network innovation. 'cause security pivots off the network data used applications, instrumentations, on the network data, everything's around networks. >> It's intrinsically tied. In the past we had a machine, a physical machine had a network interface, singular, and a network identity an address. VMs, multiple network interfaces, multiple on every VM. Kubernetes, an IP address per application, right? And it's like the networking space is exploding as we move up. And yes, we now have a network connectivity and management problem that's over of magnitudes more complicated than it was before because now, individual workloads have IP addresses. And by the way I'm deploying workloads in multiples. I don't run a single application, I run a pool of applications, each one has an address. And so yeah networking is-- continues to be intrinsic and it just moves up. >> And it's fascinating too, you know, we always speculate about looking for that new technology, the new protocol, something new, the shiny new toy. But if you think about it, all the science and intellectual property has been built already. It's usually a combination of a couple different things. In network theory, in network management, the concepts are still around. It's being applied differently now. >> Or sliced into smaller, you know, smaller, the bites are smaller that you're dealing with, right? Everything has an IP address, we got thousands of IP addresses now that we're managing. Having IP address management problems, we have other things to manage now. >> The game is still the same. >> The game is still the same, it's still TCP IP networking. >> So final question, bottom line, why Cisco and the cloud networking as it comes together? As this stuff starts to modernize, hybrid is certainly reality hardcore, as people are doing today. Multi cloud is also another reality right around the corner. Why Cisco? Why Cisco's products and portfolios for the cloud? >> Well fundamentally, as we said earlier, the cloud has a networking problem. Networking underpins everything that we do. The networking, from physical networking the compute has to run on something. So networking, compute, orchestration systems for all of that, security that overlays all of that. I think Cisco uniquely has all of the components that it takes to build a modern infrastructure stack, and in fact deploy applications to that. I think, the breath of knowledge and capabilities Cisco has across those is unique. And then, also, I would say, Cisco's experience. We have many-- several of the world's largest SaaS applications in the Cisco family. Things like umbrella, DNS security, or Webex, web conferencing, we also have deep expertise in running applications and that's within the Cisco domain of expertise. >> Certainly in good position, I really I'm really bull-ish on what you guys can do. I think the network is where the trust is, it's where the data is, that's where the action is, and I think that's the cloud 2.0 equation. Thanks for coming in. Thanks for the insight. Reinhardt Quelle, principle engineer, Cloud Platforms of Cisco here sharing his insight on this Cube conversation. I'm John Furrier, thanks for watching. (upbeat music)

>> Announcer: Live, from Boston, Massachusets, it's theCUBE covering Red Hat Summit, 2019. Brought to you by Red Hat. >> Well, welcome back here in Boston. We're at the BCEC as we are starting to wrap up our coverage here of day two of the Red Hat Summit, 2019. Along with Stu Miniman, I'm John Walls, and we're now joined by Ashesh Badani, who is the senior vice president of Cloud Platforms at Red Hat. Been a big day for you, hasn't it Mr. Badani? >> It sure has, thanks for having me back on! >> You bet! All right, so OpenShift 4, we saw the unveiling, your baby gets introduced to the world. What's the reaction been between this morning and this afternoon in terms of people, what they're asking you about, what they're most curious about, and maybe what their best reaction is. >> Yeah, so it's not necessarily a surprise for the folks who have been following OpenShift closely, we put the beta out for a little while, so that's the good news, but let me roll back just a little. >> John: Sure >> I think another part of the news that was really important for us is our announcement of a milestone that we crossed, which is a thousand customers, right? And it was at this very summit and theCUBE definitely knows this well, right, because they've been talking for a while. At this very Summit in 2015, four years ago, that we launched OpenShift Version 3. Right and so, you know you fast forward four years, right, and now the diversity of cases that we see, you know, spanning, established apps, cloud native apps, we heard Exxon talking about AIML data signs that they're putting on the platform, in a variety of different industries, is amazing. And I think the way OpenShift 4 has come along for us, is us having the opportunity to learn what have all these customers been doing well, and what else do we need to do on the platform to make that experience a better one. How do we reimagine enterprise kubernetes, to take it to the next level. And I think that's what we're introducing to the industry. >> Ashesh I think back four years ago, kubernetes was not something that was on the tip of the tongues of most people here. Congratulations on 1,000. >> Thank you. >> I hear what, 100, 150, new customers every quarter is the current rate there, but what I've really enjoyed, talked to a CIO and they're like okay, we're talking about digital transformation, we're talking about how we're modernizing all of our environments, and OpenShift is the platform that we do it. So, talk a little bit, from a customer's standpoint, the speeds, the feeds, the technical pieces, but that outcome, what is it an enabler of for your customers? >> Yeah, so excellent points Stu, we've seen whole sale complete digital transformations underway with our customers. So whether it's Deutsche Bank, who came and talked about running thousands of containers now, moving a whole bunch of workload onto the platform, which is incredible to see. Whether it's a customer like Volkswagen, who talking yesterday, if you caught that, about building an autonomous, self-driving, sets of technologies on the platform. What we're seeing is not just what we thought we would only see in the beginning which is one built, cloud native apps, and digital apps, and so on. Or, more nice existing apps, and bring them on the platform. But also, technologies that are making a fundamental difference, and I'll call one out. So I'm a judge for The Innovation Awards, we do this every year, I have been for many years, I love it, it's one of my favorite parts of the show. This year, we had one entry, which is one of the winners, which is HCA, which is a healthcare provider, talking about how they've been using the OpenShift platform as a means to make a fundamental difference in patients' lives. And when I say fundamental difference, actually saving lives. And you'll hear more about their story, but what they've done, is be able to say, look how can we detect early warning signals, faster than we have been, take some AI technology, and correlate against that, and see how we can reduce sepsis within patients. It's a very personal story for me, my mother died of sepsis. And the fact that they've been able to do this, and I think they're reporting they've already saved dozens of lives based on this. That's when you know, the things that you're doing are making a real difference, making a real transformation, not just in an actual customers' lives, but in users and people around the world. >> You were saying earlier too, Ashesh, about looking at what customers are doing and then trying to improve upon that experience, and give them a more effective experience, whatever the right adjective might be, in terms of what you're doing with 4. If you had to look at it, and say okay, these are the two or three pillars of this where I think we've made the biggest improvement or the biggest change, what would those be? >> Yes, so, one is to look at the world as it is in some sense, which is what a customer's doing. Customers weren't deployed to hybrid cloud, right? They want choice, they want independence with regard to which environments are rented on, whether it's physical, virtual, private, or any public cloud. Customers want one platform, to say I want to run these next generation, cloud native, market service based applications, along with my established stateful applications. Customers want a platform for innovation, right? So for example, we have customers that say, look, I really need a modern platform because I want to recruit the next generation of developers from colleges, if I don't give them the ability to play with Go, or Python, or new databases, they're gonna go to some Silicon Valley company, and I'm going to deplete my pool of talent that I need to compete, right? 'Cause digital transformation is about taking existing companies, and making them digitally enabled. Going forward, what we're also seeing is the ability for us to say well maybe the experience we've given existing customers can be improved. How do we for example, give them a platform, that's more autonomous in nature, more self-driving in nature, that can heal itself, based on for example, there's a critical update that's required that we can send over the air to them. How can we bring greater automation into the platform? It's all of those ideas that we've got based on how customers are using it today, is what we're bringing to bear, going forward. >> Ashesh, one of the errors we have trying to help customers parse through the language is, everybody's talking about platforms, if you look at the public clouds, everybody's all in on kubernetes, a few weeks ago, we were at the Google Cloud event, talked to Red Hat there, there's Anthos, there's OpenShift, look at Azure, we Satya Nadella up on stage, and you're like, okay they've got their own kubernetes platform, but I've got OpenShift fully integrated there. >> Ashesh: Yeah. >> Can you help is kinda understand how those fit together because it's an interesting and changing dynamic. >> Well it's a very Silicon Valley buzzword, right? Everyone wants a platform, everyone wants to build a platform, Facebook's a platform, Uber's a platform, Airbnb is, everything's seeming a platform, right? What I really want to focus on more is in regard to, we want to be able to give folks literally an abstraction level, an ability for companies to say I want to embrace digital transformation. Before we get there, someone's like what's digital transformation, I don't even understand what that means anymore. My simple definition is basically flipping the table. Typically companies spend 80% on maintenance, 20% innovation, how do we flip that? So they're spending 80% innovation, 20% maintenance. So if we're still thinking in those terms, let me give you a way to develop those applications, spend more time and energy on innovation, and then allow for you to take advantage of what I'll call a pool of resources. Compute, network, and storage. Across the environment that you have in place. Some of which you might own, some of which some third parties might provide for you, and some of which you get from public cloud. And take advantage of innovation that's being done outside. Innovative services that come from either public cloud providers, or ISPs, or separate providers, and then be able to do that innovated rapid fashion, you know, develop, deploy, iterate quickly. So to me that is really fundamentally what we're trying to provide customers, and it takes different forms, internal packaging. >> Maybe you can explain to me, the Azure OpenStack seems different than some of the other partnerships. Two years ago, when we were sitting in this building, we talked to you about AWS with OpenShift in that partnership, so what's differentiated and special about the Azure OpenStack integration. >> Yeah, so the Azure partnership, it's a good question because we've now taken our partnering with the public cloud providers to the next level, if you will. With Azure there's a few things in play, first it's a jointly offered managed service from Red Hat and Microsoft, where we're both supporting it together. So in the case of OpenShift and AWS, that's you know OpenShift directly to the ring of service, in this case, it's right out of Microsoft, working close together to make that happen. It's a native service to Azure, so if you saw in the keynote, you could use a command line to call OpenShift directly integrate into the Azure command line. It's available within the interface of Microsoft-Azure. So it feels like a native service, you can take advantages of other Azure services, and bring those to bear, so obviously increases developer experience from that perspective. We also inherit all the compliances, certifications, that Microsoft-Azure has, as well, for that service, as well as all the availability requirements that they put out there, so it's much more closely integrated together, much better developer experience, native to Azure, and then the ability for the Microsoft sales team to go out and sell it to their customers in conjunction. >> You talk a lot about different partnerships, and bringing this collaborative, open-mindset to each and every relationship, how hard is that to do? Because you have your of way of doing things and it's worked very well, and yet, you go out and you have these new partnerships or extensions of partnerships, and not everybody with whom you work does things the same way, and so, everybody's gotta be malleable to a certain extent, but just in terms of being that flexible all the time, what does that do for you? >> So, we take that for granted sometimes, the way we work. And I don't mean to say that to be boastful, or arrogant, in any fashion. I had an interview earlier today, and the reporter said why don't you put on your page, that you're 100% open source? And I said we never put that on our page because that's just how we work, we assume that, we assume everyone knows that about us, and we're going forward. And he says, well, I don't know, perhaps there's others that don't know. And he's right. The world's changing, we're expanding our opportunities in front of folks. In the same way we've only and always known, we used to collaborate with others in the community, before we fully embraced OpenStack, there were certain projects that Red Hat was investing in that were Red Hat driven, and we say maybe there wasn't as much community around it, we're gonna go down and embrace and fully parse an OpenStack community. Same's the case, for example, in kubernetes too. It's not necessarily a project that we created on our own, in conjunction with Google, and many others in the community. And so that's something that's part of our DNA, I'm not sure we're doing anything different, in engaging with communities, just how we work. >> So, Ashesh, I know your team's busy doing a lot of things. We've been hearing about what sessions are overflowing, down in the expo floor, so why don't you give us some visibility. But there was one specific one I wondered if you could start with. >> Ashesh: Sure. >> So down on the expo floor, it's a containerized environment and it has something to do with puppies, and therefor how does that connect with OpenShift 4 if we can start there. >> That's a tough one, you're gonna have to go and ask the puppies how to make a difference in the world. (laughing) >> John: So we go from kubernetes to canines, (laughing) that's what we're doing here. >> I do believe they're comfort dogs, but there was coding and some of the other stuff, so give us a little bit of the walk around, the expo flow, the breakouts and the like, in some of the hot areas, that your team's working on. >> Fair enough, fair enough. Maybe not puppies, but maybe we're trying to herd cats, close enough, right? >> John: Safer terrain. >> The amount of interest, the number of sessions, with OpenShift, or container based technologies, cloud based technologies, it's tremendous to see that. So regardless if whether you see the breakouts that are in place, the customer sessions, I think we've got over 100 customers, I think. Who are presenting on all aspects of their journey. So to me, that's remarkable. Lots of interest in our road map going forward, which is great to see, standing room only for OpenShift 4 and where we're taking that. Other technology that's interesting, the work, for example, we're doing in serverless. We announced an OpenSource collaboration with Mircrosoft, something called KEDA, the Kubernetes eventually. Our scaling project, so interesting how customers can kind of engage around that as well. And then the partner ecosystem, you can walk around and see just a plethora of ISVs, we're all looking to build operators, or have operators and are certifying operators within our ecosystem. And then it's ways for us to expose that to our joint customers. >> We're gonna cut you loose, and let you go, the floor's gonna be open for a few minutes, those puppies are just down behind Stu, we'll let you go check that out. >> Alright, thanks, I hear you can adopt them if you want to, as well. >> Before we let you go see the comfort dogs, 1,000 customers, where do you see, when we come back a year from now, where you are, where you wanna see it go, show us a little bit looking forward. >> So there's been some news around Red Hat that has probably happened over the last few months, the people are hearing this, I look at that as a great opportunity for us to expand our reach into markets, both in terms of industries perhaps we haven't necessarily gone into, that other companies have been. Perhaps we say it's manufacturing, perhaps this is the opportunity for us to cross the chasm, have a lot more trained consultants who can help get more customers on the journey, so I fully expect our reach increasing over a period time. And then you'll see, if you will, iterations of OpenShift 4 and the progress we've made against that, and hopefully many more success stories on the stage. >> Alright, looking forward to catching up next year, if not sooner. >> Ashesh: Okay, excellent. >> John: And congratulations on today, and best of luck down the road. >> Thanks again for having me. >> And good to see you! >> Ashesh: Yeah, likewise! >> Back with more on theCube, you are watching our coverage live, here from Red Hat Summit, 2019, in Boston, Massachusetts. (upbeat techno music)

>> From New York City, it's the cube, covering automation anywhere, Imagine brought to you by automation anywhere. >> Hey welcome back everybody Jeff Rick here with theCUBE. We're in midtown Manhattan at the automation anywhere, imagine 2019 event we were here last year, it's grown quite a bit and we're excited to be back. Our very first guest of today is Kashif Maboob, he is the VP Product Marketing and Global Head of our PA at automation anywhere. Great to see you. >> Nice to be here. >> Yeah so a year ago, in June I looked up the date and since June you guys have had a very exciting year, you raised like a half a billion dollars the RPA space is blowing up and this conferences I think outgrowing the venue so it's been quite a years. >> It certainly has been quite a year, yes we did have the largest Series A for a enterprise software company ever we are still on the Series A which is quite significant in our industry at the moment, the growth has been phenomenal, last year when you and I met here we had nine offices we have 35 offices today we have... we are looking at exiting 2019 with about 3,000 employees the numbers just speak for themselves. RPA that category itself has been at a growth space that I certainly have never seen before. >> So here had a great keynote a little bit earlier and he touched on a couple of really key topics and he did this last year too when he talked about, truly transformational technology shifts. And he talked about mobile before and personal computing and some of these things and he had three kind of things, it has to work for everyone it must be available anywhere and it must work for any size company and you guys are making real concrete moves into that area and one thing he talked about, is this concept of community edition. So i wonder if you can give us a little bit more flavor what is community edition, why is it important automation anywhere? >> Absolutely the concept, the vision that we are driving towards, is automation for all. For all types of users, by that we mean business user, IT user, developer. You don't have to be somebody who is proficient at coding you don't have to be somebody who is doing just one part of the business. Anybody in the business should be able to pick up the software and start using it. So with that concept in mind, we then thought about all types of businesses. Because until not too long ago RPA was a realm for the largest of the large companies. So last year fourteen fifteen hundred of our enterprises that number has grown to about 2,800 now. Still some of the largest companies in the world. Now taking it further is also talking about the various channels through which we deliver our software. so not just on premises which is most of RPA today but going forward enabling cloud delivery models. So with all that combined what is the fastest way to get people started on it and that is to remove all barriers to remove all friction and that's where community Edition comes in. It's a free product, it is the entire digital workforce platform. So not just RPA but RPA with AI and with analytics all combined, with a mobile app ready system. So when you when you sign up or download, whichever way you want to call it. You are actually signing up into a very robust, very comprehensive the most complete digital workforce platform that enables business users, students, educators, but perhaps most importantly developers to start developing their own bots, their own software robots. A community edition is just one piece of a larger ecosystem strategy that we have, that includes the community edition. So download the software or sign up into it and start building, but where do you learn how to build bots? well, we have Automation Anywhere University. We have about 175,000 students signed up already. We're fast becoming the world's largest University as well and then... So you have free courses available, you can get certifications as a trainer as a developer, as a business user. Once you have that training you can start developing bonds. Let's say you have questions that you want answered or you feel like the expert who should be sharing his or her knowledge for that we have the A people community, it's again RPA's largest community in the world, seventy-five thousand plus users already so that's piece number three and last but not the least, you've downloaded the Community Edition, you've become proficient in building boards, you're sharing knowledge and your expertise what's the next step? The next step is to build bots that the rest of the world can use so we are we have bought stores that we launched last year >> right >> so you can actually upload your bots and you will start monetizing the bots so it isn't a virtuous cycle, it's an ecosystem of free software, free education, free community, in a marketplace that lets you share your knowledge your expertise with the world. So that's our vision that's what we are very much into it and more than a vision it's in practice today. >> Right it's an interesting play right because we always hear about the democratization of data, and the citizen developer, so you guys are really talking about the democratization of automation and I'm sure there were some interesting conversations we're going to have the CFO on later, about you know taking some revenue off the table to enable kind of this community outreach to go out and offer really a full stacks almost like a freemium, classic kind of freemium play, to let people and as you said developers, schools, small businesses get involved in this. What if you could talk about kind of the strategic reason that you're giving up some short-term revenue for obviously a much potential bigger gain down the road. >> So a great point , if you look at the vision, the vision is to automate any process that can be automated right. Is to automate any process any organization that should be automated so what does that mean? That means an enormous workforce that is RPA ready. RPA educated that has knowledge of RPA and not just RPA but any automation per se because AI is included in here. >> Right >> So the only way we can reach that goal, of having millions and millions of users using not just our product, but any RPA product is to educate them to get products in their hands and so we can't think short term in that way. Our our vision is multi-decade vision. And its enormous vision as you as you heard also you mentioned so it's automation for all. For any business size and through any delivery channel >> Right >> And that's where the strategy is that's why we launched Community Edition and you will see a lot more coming down the pipeline as well >> Right So the next big theme is cloud right, we were both at the Google cloud show, last week there you got an announcement here about Oracle cloud and then here talked about, your guys own cloud so I wonder if you can talk a little bit about kind of the cloud strategy and then some of these different options that you guys are enabling for a cloud enabled version of automation anywhere. >> Absolutely so that's a big step just like freeing up our software, through community edition, we need to open a channel through which anybody can have software available so so you don't have just the option of on-premise software, but cloud ready web ready software so for that we announced today, the intelligent automation cloud. The the focus is simplicity, security and scalability. Those three things are critical for any business should be simple enough for anybody to use the software without having to download and install and maintain and so they're big huge cost IT costs for maintaining and price of it >> Right >> So removing that cost, that's what we mean by a zero footprint software it's simple but simple does not mean it's weak or its anything like that. Simple mean is powerful, easy enough to use, intuitive enough to use for a business user >> Right >> Who is who's expertise lives in the process, not necessarily in the coding and scripting environment >> Right >> On the other hand giving the the developers a very robust and IDE you know development environment so that all users, the business user the developer and the IT manager they all get the capability. Security is built-in. We cannot have robust security if you're dealing with world's largest financial organization nine out of ten largest banks, are already in business with us so security is paramount. Audit compliance is paramount >> Right >> Audit ease is paramount and last but not the least is the scalability. So cloud provides us and our customers infinite scale. So simplicity, security, scalability, delivered through cloud and an intelligent cloud not just a cloud that is basic, but cloud where AI is built in >> Right >> Where cognitive capabilities are built in so that's that's a vision that's the goal >> Right but it's and even more of that it's just choice right depending on what the customer needs what their particular application is, within a within a single customer or a single entity pick a large bank, they may have some implementations behind the firewall, on prem they might have some, on your cloud they might have some on some of these big public clouds. You're really offering now the choice it's not necessarily a locked in delivery strategy. >> So we are certified with the five largest cloud platforms available today. Whether it's Google, Oracle, Amazon Web Services, Azure, you will see Microsoft talking here today you will hear from IBM executives here today. Very close partnerships with these organizations >> Right >> So not only that we are technology partners, but we are certified with their cloud platforms which makes which gives our customers the peace of mind. >> Right >> That if we are certified, say with AWS Amazon Web Services, the security that's built into Amazon Web Services, the scalability that comes out of it, the 99.99% uptime and all of those amazing things that amazon has invested in >> Great >> Over the years and now available to our customers as well >> Right >> So that's that's an important factor. >> A lot going on since we last that down a year ago but let's let's look at forward again and I think I asked you last year, you know what are we going to be talking about 2019? So what's coming next? I mean you guys have a huge war chest, you're in a very hot space, you have a lot of momentum Like how you said you doubled your offices in a year, hiring like mad, so what's next? what are you what are you working on in the near term, and the mid term? >> So we started with Community Edition a month ago so in a month we have about 12,000 signups and downloads which is very significant for our enterprise business. It's from throughout the world but in a month's time we are coming out with one of our most the biggest releases if you will ever and that's where we introduce the cloud, that's where we introduce for the business user, a completely web-based interface, which is what we call bot sketch, that gives you the ability, to drag and drop and build your process and in the backend we will develop the bot the software robot for you so it's sort of a bridge between a business user, and she might be on the accounting side or billing side but she's the expert in knowing her own process but she's not a scriptor, she's not a coder she's not a developer, her area of expertise is is the process itself >> Right >> It could be a logistics process , it could be an HR process and she can sketch out their process just like building a workflow and once she finishes her work and she's complete with her workflow or her process end to end, the the development side can take over and the code is already written for them at that point the developer can bring in their own Python code, can run it on Linux, in IT is the third user of course and they can see the entire environment so we are launching an environment that is ready for business that's robust enough for for the developer and secure and gives peace of mind to the IT so that's a major release it of course comes with our built-in security, cloud management and all of that so >> Right >> That's what we are rolling up to and Community Edition is there and you will see more and more talk about digital worker, you earlier you saw me here and it described the digital worker, bot store is there, it's the first-ever automation marketplace so there are lots of firsts >> Right >> And there are lots of the biggest and the largest so we are running out of you know superlatives to use here. I'm in marketing of course, so I have to be careful what I what I come up with >> That's right there's people playing bingo probably so we have to careful that they don't fill up their card. I just want to give you the last take you know when we talk a year ago you talked about three things, about RPA by itself, no kind of cognitive automation and in incorporating you know machine learning and artificial intelligence and then smart analytics and as you're talking and I'm listening, you know I don't even necessarily need to build the body, I mean you just kind of built around the bot but now I can I can get somebody else's bot, now you're talking about actually building the bot for me so you you're leveraging a lot of these, core technologies to power the compute and cloud to actually help me build the bot, taking me one step further where I just need to know my process to be able to start to implement my own digital assistants and and add automation to my world. >> Absolutely so the story is not the bot, the story is always the customer, looking at the customers pain point and what can we do to solve that pain point. How can we make the process more efficient, better faster cheaper right so the bot is a vehicle for us to really enable our customers, to really simplify their lives so that as Mahir mentioned, we as humans can do more cognitive more intelligent work >> Right >> That's the vision >> Right >> and everything that we are announcing today, everything that we have done in the past 15 years that we've been business and our vision is all about you know a fanatical customer focus, we have a large partner base as well we work with largest advisories over 700 partners so if you look at the overall picture it's again building an ecosystem for our customers where they are not tied to one thing >> Right >> We are not we are trying to open it up it's an open platform, we work with best-of-breed, at the same time we provide our customers readiness with AI and security right out of the box as well if they already have a Best of Breed system installed, we will work with that, if they would like to work with our systems, we will work they have capability there so it's a it's a very open approach, it's a very flexible approach because there's no way we you cannot tie down your customer and expect them to stay with you. We want to enable them to automate their process in the most efficient way possible. >> Yeah well congratulations, it's quite a ride and I think the real fun stuffs just getting started. >> Yes absolutely thank you. >> All right thanks again. >> All right, he's Kashif I'm Jeff you're watching the cube were on a mission anywhere, imagine 2019 in midtown Manhattan. Thanks for watching, see you next time (upbeat music)

>> fly from San Francisco. It's the Cube covering Google Club next nineteen, right Tio by Google Cloud and its ecosystem partners. >> Okay, welcome back, everyone. We are here live in San Francisco for cubes. Coverage of Google next twenty nineteen. Hashtag Google. Next nineteen, Google's Cloud Conference, where their customers, developers all come together Cubes. Three days of coverage. Day one. I'm John forward, my Coast, Dave Aloft as well. Astute many men Who's out there doing some reporter? Next guess Allison. Wagon filled is the CMO of Google Cloud. Great to see you. Thanks for joining us. >> Thanks for having me. I'm glad to be here, >> so I got to say, looking out on the floor here, we're in the middle of the floor. Great demographics. A lot of developers, lot of enterprise customers. A lot of you know, sea levels will also enterprise architects and cloud architects. So this is not just a developer fest. This is a business developer conference. >> Yes. So that's been a real change this year. Not only have we increase the numbers I think I mentioned earlier that we have thirty thousand people are actually able even more than that. We had a cap registration we sold out last week. But the composition is different this year because this year we have over seventy percent from enterprise companies and then within enterprise Cos it's Dev's decision makers, business leaders. And then we have a whole executive track of leader Circle program as well. So it's been a really great mix of different energy, different questions in different sessions. >> You guys do a great job in event kudos to the team original Google Io was a great event that continues to be the consumer side on Google. You guys have that same kind of grew swing going on a lot of sessions. Take him in to explain the theme of the show. What's going on around the events? Breakouts? What's the focus? >> Yes, so the focus? Well, there's a theme and a couple different levels. The broad theme is a cloud like no other, because we've introduced a lot of new, different features and products and programs. We introduced Antos this morning, which was really revolutionary way of using containers broadly multi cloud, high but cloud. So it's from a product standpoint, but it's also a cloud like no other, because it's about the community that's here, and it's truly a partnership with our customers and our partners about building this cloud together, and we see the community as a really key part of that. It's really corta Google's values around openness, open source technology and really embracing the broader community to build the cloud together. >> And I thought was interesting. The Kino was phenomenal. You had the CEO of Google come out Sundar Pichai and the new CEO on the job for ten weeks. T K >> Sommers. Korean. Yes. Lot of action >> going on a Google right now. >> Yeah, it's been great to have Thomas. Diane was phenomenal and building the business. It's wonderful. Have Sundar here. He's got a lot of commitment, really engaged with our customers. And so it's a lot of energy and a lot of excitement. A Google. >> I thought the vory class act of Thomas Curry and his first words on stage at the CEO was to give props. The Diane Green very, very respected, that was >> great, was very gracious of, Thomas >> said. Sorry, he said. The press, sir, that one of things I really like about Google is not afraid of hard problems, So I wanted to ask you a CMO I always asked the most about brand promise. What's the brand promise? That you want customers and the community to take away from an event like this? >> So the brand promise has a couple different areas. First and foremost, we want our customers to be successful with their customers. And so we think, really holistically about lessons. Make sure that we're delivering the cloud technologies so that customers can really serve everyone that they want to serve, whether it be a retailer that wants to create a wonderful, offline and online experience, whether it's a health care provider that wants to ensure that every doctor, it knows all of the right data about all the patients or within a hospital. And so that's the way we're always thinking is how do we ensure that we help our customers set up to be successful? >> So one of the big teams we heard this morning was the industry focus, and you just referenced that again. It seems to be an increasingly important part of the messaging and the technologies that you're creating, and it ties into digital transformation. You seeing every industry transform data is at the heart of that transformation. You're seeing big companies traverse different industries. So what if you could talk about the industry focus? Uh, where'd that come from? Where do you see it going? >> Yes, So there's really three core parts of what we've been talking about today. First and foremost is the infrastructure and ensuring that we have the world's best infrastructure. Then, on top of that, it's ensuring that we have all the right applications to help with digital transformation. And then, as part of that further, is the industry solutions. Because in our six focus industries, we want to make sure that we're really developing the right applications with the right solutions and half a deep expertise that companies are looking for so that we can really part with partner with them and really, truly be innovative. And we could feel much more comfortable being innovative. But we really understand our customer problems >> keep Part of that is the global s eyes. You look out here, you see all the big names I won't name because I'll forget one. But there's two obvious ones right there because once you start to see those guys come into the ecosystem, that's when you can partner and get really deep industry expertise globally, >> I agree. And so we do have a great partnerships that said here with Accenture in tow, Lloyd and Antos or three of them, many more that we were working really closely with. And there really are an extension of what we want to build because we know that we will not be able Teo create every single last mile industry solution and every single industry, and working with those companies really helps us. >> I was on the plane last night watching the game. Of course, I love you guys got to see it. You're probably appear busy, but I focused. Google was all over the this year, >> so this is our second year of our partnership with the law, and it's been great. There's a couple dimensions to that partnership. First and foremost, we help them analyze eighty years worth of data. And through all of that analysis, we've been working with him about making predictions about games in helping them understand players and coaches and teams better. Everything from creating brackets. Teo, how do you fan experience? And then as part of that, we also had opportunity to do some advertising within their games. So you may have seen some of the TV spots that we did, which was about analyzing that data. We put ourselves on the line by making predictions during the game about what we thought would happen based on all of our analysis. And then the Big Chef this year was we included students, so it was really studies. Last year we created all these models, but we did it within Google. We had Google, Debs and Google engineers creating prediction models. We said, like, What if we brought students in tow? Help us? So we recruited thirty or so all star students around the country from their schools, brought them together. They learned DCP like that. It was awesome. And then they started working together doing predictions. And so a lot of what you saw in the Games and on our hub was actually students using Google Claude platform to make predictions about the games. >> So just get this right. The reference on stage by T K students. So you had data from the that was exposed to the students. They had a hackathon. How much lead time that they have? What was that >> did everything with thirty days. So they hack it on was about two months ago or so. But within the last thirty days, they did all of these different projects and they were actually doing really creative things about trying to come up with new types of stats like explosiveness. What does that mean? Does that mean that you move in closer to the basket or does it mean that here they're coming up, the stats around pace of game and different elements of the place? It was really fun. >> How many slam dunk this, Miss Fowles? So >> question, Who do you who you're rooting for? I was >> writing from Virginia. You know, Let's say I >> was right for >> Virginia after my bracket got busted, so I was allowed to kind of change a little bit. And they're Michigan. Once they were gone, I was like, >> So I use no way. I but I hit ninety ninth percentile. So you go. I had Michigan in Michigan State rather in Virginia in my Final Four for Michigan State. Lost, but still, I would have been >> That's pretty good >> night, point nine. So what is with what kind of predictions were the students doing well, >> predictions about everything from, well, last night we had some predictions about the number two point last. We had about how many different times we're going to exchange like the ball will go back and forth between teams. We had predictions about three pointers and one game everything. So it's been really fun. Teo work with >> that kind of in game predictions. To see that a lot. >> You probably saw some stats real >> probability of, ah, victory, which of course, last night. Forget it. I mean, it's changed so quickly. >> Great program. One of those I want to ask you change gears is you have a book in the press room called customer Voices. So this has been a focus, and I think a lot of people have been Lego Google's great tact, but not a lot of customers, which you guys air debunking with. Not only this, but here to show shown the logo slide really kind of showing the traction from a customer's standpoint. >> Yes, about >> the focus on the customer. How does that change? How you doing your job? How is the tech rolling out? Can you share some insight into customer focused. >> Yeah, this has been a really big step change this year. We have over four hundred customers speaking throughout this event, and then we have a number of them that are on stage in the keynotes telling real stories. Two years ago, we had some customers speaking and they would say, I'm looking. I'm dabbling and this But now they're making rial kind of bet The company decisions using our technology. And so this customer voices is looking at those companies. We have something called the customer innovation serious this afternoon, where the CIA of HSBC will be talking about their evolution and Gogo Cloud. Two years ago, Darrell West was on stage talking about just kind of what they will be getting. Two Dio with Google Cloud Platform And now here we are two years later, when they've made a lot of progress and we'LL be sharing their stories that the custom innovation Siri's is one of my favorite parts. It next, >> you know, we cover a lot of events. David eyes were like two ESPN of tech or game day. We've gotten the shows, we see a lot of events and you kind of hear the key words over and over again. Soon these events here we're hearing scale, which we've heard all the time. Google scales, scales, scales solve all our problems. But we're hearing more about customers. OK, this has been a big focus. How have you guys shifted internally? Because this seems to been around for a while. Like you said, I think it's a step function from what we're seeing as well. What's going on internally. How you guys mobilizing, How you guys taking this to the mark? Because you've got great partition. So Cisco onstage VM wears even up there. You got an ecosystem developing a lot of momentum. >> So we're truly this year Enterprise ready to use a buzz word that comes up. So two years ago, we still had some holes in some of our technology stack, and we're still really building to go to market teams. We still vastly scaling that so absolutely growing there. But we're in a whole different place as a business where we are able to serve really large enterprises at scale. McKesson just announced sixth largest company that they are moving and working with us a Google cloud. I mean, so these air major companies that are making big decisions to work with us. And so it's at a whole different level this year, and we're really proud that the customers have chosen to work with us, and we're building the organization to ensure that their successful. So that's our customer success program. That's ensuring we have the right kind of customer engineers working hand in hand with our customers. So it's a big focus ever. Whole group. It's a focus where Thomas Kurian has a lot of background serving enterprise customers at Oracle for twenty years, bringing that expertise. So you'LL see that everywhere. So I'm glad you picked up on that and feel it because it's really permeates everything we're doing at Google clouds, >> and it's been a good, positive change. The results of their What's the focus for you As you look forward, It's a lot to do. You guys are a great opportunity. I always say Google's dark horse now Samson's got a good lead out there being first in, but you guys have a lot of tech. You got the customer focus. You got a lot of momentum on the tech side. Cloud native Open source. Partner ecosystem Developing customer ecosystem. So kind of ball's in your court, so to speak. >> You feel really well, position we It's early. So in the whole market, people seem to think that I like all these decisions, but it's really still eighty percent of workload Zoran data centers of these big enterprises, everybody who's here with us right now. And most companies were choosing a multi club strategy this morning. We announced a major product and those that really enables the multi cloud strategy so enables Google to really be at the center of that multi cloud and provide the services using containers and a lot of the biggest best advances right now. And so as we scale our go to market, we can really bring this technology that way here, over and over again, is the best technology in the business. Yeah, we had it really had to go to market in place to bring it to customers. And this is really where we're taking it so we can help get this awesome technology. It's so fun is a marketer to them, bring it to everybody. >> I always say it so early. The wave is just getting started more ways behind it. I'm very impressed. That intrigue also by the rebranding of the Google Cloud platform what you guys announced last kind of hybrid and those is interesting because it's a rebrand slash new set of integration points Sisco again on stage kind of integrating with your container platform is a key key story that I think is nuanced but kind of points to a whole new Google. What was behind the rebranding? Can you just share some insight that what the commerce she's like Google Cloud Platforms is descriptive. But I mean, >> sister, thanks >> Cloud Services platform when we chose that name last year is when we wanted to Alfa with a product and frankly, within the marketing team, he kind of knew was always a placeholder name. And then the debate was, What do we change the name when you go to Beta, which we did a couple months ago? Or when we go to went to Gaea and we decided this would be a great opportunity to change the name, so we always knew it was going to change the name. Picking a name is always complicated, and so we spent a lot of time thinking about what way wanted that name too mean and what we wanted to stand for. And we really liked Anthros. It's a Greek word. It is a nod to the Greek aspects of the history of the product. With Cooper, Netease, Andhis, Teo and other areas. It means the blossom it means to grow. It means all. And so you many words like Anthology and things like that. So we'd liked both what it meant, And we also liked that with all Namie decisions, it's easy to spell. It's easy to find. It's all great, >> and it's super >> booming in California. Here as we speak. Well, ironic. >> It has an international flavor to it. But you guys, you guys are taking this show overseas, right? They've got a big show in London in November, I know and yes, >> be in Tokyo in July at next and then London in November. And then we do it between all of these. What we call Clouds Summit Siri's, which are in country slightly smaller. But we bring a lot of the same technology, and speakers and sessions just have a slightly scaled down version. >> Intimate. We really appreciate your support. We love doing the Cube hearing a lot of Czech athletes, as we say here on the show floor. Lot of knowledge, good customer converses. Alison's Thanks for sharing the inside congratulates on the great >> show, so I left be here. Thanks >> for rebranding as the market shifts. Great time to have a rebrand, certainly when it means something more. Multi cloud hybrid cloud Google Cloud Platform now and those that cube bring you live coverage here from the floor at Google next twenty nineteen. Stay with us for more after this short break.

>> Live from Seattle, Washington, it's the Cube, covering KubeCon and Cloud Native Con North America 2018. Brought to you by Red Hat, the Cloud Native Computing Foundation and its ecosystem partners. >> Welcome back everyone. We are live in Seattle for KubeCon 2018, Cloud Native Con. It's the Cube, I'm John Furrier, your host with Stu Miniman. Our next guest is Ashesh Badani, who is the Vice-President and General Manager of Cloud Platforms at Red Hat. Great to see you, welcome back to the Cube. >> Thanks for having me on. Always good to be back. >> So you guys, again, we talk every year with you. It's almost like a check-in. So what's new? You got some big, obviously, the news about the IBM. We don't really want to get into that detail. I know you just a stop on that because it's already out there. But you guys had great success with platformers of service. Now you got the growth of Kubecon and Cloud Native Con, 8000 attendees and users. There's uptake. What's the update on the Red Had side? >> Yeah, we're excited. Excited to be back at Kubecon. It's bigger and better than it's ever been, I think so. That's fantastic. We've been investing in this community for over four years now, since 2014. Really, from the earliest days. Based the entire platform on it. Continue growing that, adding lots of customers across the world. And I think what's really been gratifying for us to see is just the diversity of participants. Both in user perspective as well as the wider ecosystem. So whether you're a storage player, a networking player, management, marketing, what have you. Everything sort of building around this ecosystem. I think we're creating a great amount of value and we're seeing diverse applications being built. >> So you guys have been good then on (mumbles), good timing, a lot of things are going on. This show is an open-source community, right. And that's been a great thing. This is kind of where the end users come from. But two other personas come in that we're seeing participate heavily. The IT pro, the IT expert, and then the classic developer. So you have kind of a melting pot of how this is kind of horizontally connecting. You guys have been successful in the IT side. Where is this impacting the end users?6 How is this open-source movement impacting IT, specifically, and at the end of the day, the developers who are writing code? Have to get more stuff out. What's your thoughts? >> So, we hosted OpenShift Commons yesterday. OpenShift Commons, for the the folks who don't know, is our gathering of participants within the larger OpenShift community. We had lots of end users come and talk about the reason they're adopting a Kubernetes-based platform is to get greater productivity. So for example, if you're someone like Progressive Insurance, an established organization, how do you release applications quicker? How do you make your developers more productive? How do you enable them to have more languages, tools, frameworks at their disposal? To be able to compete in this world where you've got start-ups, you've got other companies trying to compete aggressively with you. I think it's a big dent here, right? It's not just for if you work traditional IT. But it's for if you were a company of all sizes. >> When you talk about customers, every customer is different. You've got, you look at IT, everything is additive, it tends to be a bit of a heterogeneous mess when you get there. Help connect for us what are you hearing from customers? How does, not just Kubernetes, but everything going on here in the Cloud Native environment? How is it helping them? How is it changing the way that they do their business and how's Red Hat involved? >> So one thing we've been noticing is that Hybrid Cloud is here and here to stay. So we've consistently been hearing this from customers. They've invested lots of money and time and energy, skills, in their existing environments. And they want to take advantage of public clouds. But they want to do that with flexibility, with portability, to bring to bear. What we've been trying to do is focus on exactly that. How do we help solve that problem and provide an abstraction. How do you provide primitives. So, for example, we announced our support of Knative, and how we'll make that available as part of OpenShift. Why's that? Well, how can we provide Serverless primitives within the platform so folks can have the flexibility to be able to adopt next-generation technologies. But to be able to do that consistently regardless of where they deploy. >> So, I love that. Talk about meeting the customers there. One of the things that really strikes me, there's so much change going on in the industry. And that's an area that Red Hat has a couple decades of experience. Maybe help explain how Red Hat in bringing some of that enterprise, oversight. Just like they've done for Linux for a long time. >> Yeah, yeah. Stu, you're following us very closely, as are you John, and the team at the Cube. We're trying to embrace that change as it comes upon us. So, I think the last time I was here, I was here with Alex Polvi of Core OS. Red Hat acquired Core OS in January. >> Big deal. >> Yeah, big acquisition for us. And now we're starting to see the fruits of some of that labor. In terms of integrating that technology. Why did we do that? We wanted to get more automation into the platform. So, customers have said, hey, look, I want these clusters to be more self-managing, self-healing. And so we've been really focused on saying how can we take those challenges the customers have, bring that directly into a platform so they're performing more and more like the expectations that they have in the public cloud, but in these diverse, introgenous, environments. >> That speaks to the operating model of cloud. You guys have a wholistic view because you're Red Hat. You got a lot of customers. You have the Dev House model, you got the Kubernetes container orchestration, micro-services. How does that all connect together for the customer? I mean, is it Turn Key and Open Shift? You guys had that nice bet with Core OS, pays big, huge dividends. What are some of those fruits in the operating model? So the customer has to think about the systems. It's a systems model, it's an operating system, so-to-speak. But they still got to develop and build apps. So you got to have a systems-wholistic view and be able to deliver the value. Where does it all connect? What's your explanation? >> So distributed systems are complex. And we're at the point where no individual can keep track of the hundreds, the thousands, the hundred-thousand containers that are running. So, the only way, then, to do it is to be able to say, how can the system be smart? So, at the Commons yesterday we had sort of a tongue-in-cheek slide that said, the factory of the future will only have two employees, a man and a dog. The man's there to feed the dog, and the dog's in place to ensure the man doesn't go off and actually touch the equipment. And the point really being, how can we bring technology that can bring that to bare. So, one example of that is actually through our Core OS acquisition. The Core OS team was working on a technology called, operators. Which is to say, how can we take the human knowledge that exists. To take complex software that's built by third parties and bring that natively into the platform and then have the platform go and manage them on behalf of the actual customer itself. Now we've got over 60 companies building operators. And we've, in fact, taken entire open-shift platforms, put operators to work. So it's completely automated and self-managed. >> The trend of hybrid is hot. You mentioned it's here to stay. We would argue that it's going to be a gateway to multi-cloud. And as you look at the stacks that are developing and the choices, the old concept of a stack-- and Chris was on earlier, the CTO of CNCF. And I kind of agree with him. The old notion of stack is changing because if you've got a horizontal, scale-able cloud framework, you got specialty with machine learning at the top, you got a whole new type of stack model. But, multi-cloud is what the customers want choice for. Red Hat's been around long enough to know what the multi-vendor word was years ago. Multi-vendor choice, multi-cloud choice. Similar paradigms happening now. Modern version of multi-vendor is multi-cloud. How do you guys see the multi-cloud evolution? >> So we keep investing and helping to make that a reality. So, last week, we made some announcements around Open Shift dedicators. Open Shift dedicators is the Open Shift manage service, or AWS. Open Shift is available in ways where it can be self-managed directly by customers in a variety of environments. Directly run around any public cloud or open stack, or what you'd like environment. We have third-party partners. For example, DXC D-systems providing managed versions of Open Shift. And then you can have Red Hat managed Open Shift for you. For example, on AWS, or coming next year, with Microsoft. Through our partnership for Open Shift on Azure. So you as a customer now have, I think, more choice than you ever had before. In terms of adopting Dev-Ops or dealings with micro-services. But then having flexibility with regard to taking advantage of tools, services, that are coming from, pretty much, every corner of IT industry. >> You guys have a huge install base. You've been servicing customers for many, many years, decades. Highest level support. Take us through what a customer, a traditional Red Hat customer that might not be fully embracing the cloud in the past, now is on-boarding to the cloud. What's the playbook? What do you guys offer them? How do you engage with them? What's the playbook? Is it, just buy Open Shift? Is there a series of-- how do you guys bring that Red Hat core Lenux customer that's been on Prim. Maybe a little bit out of shadow IT in the cloud, saying, hey, we're doing additional transformation. What's the playbook? >> So, great question, John. So, first fall into the transformation might be an over-hyped term. Might be a peak hype at this point in time. But I think that the bigger point from my perspective is how do you move more dollars, more euros, more spend towards innovation. That's what every company is sort of trying to do. So, our focus is, how can we build on the investments that they've made? At this point in time, (mumbles) Lenux probably has 50,000 customers. So, pretty much, every customer, any size, around the world, is some kind of Lenux user. How can we then say, how can we now provide you a platform to have greater agility and be able to develop these services quicker? But, at the same time, not forget the things that enterprises care about. So, last week we had our first big security issue released on Kubernetes. The privilege escalation flaw. And so, obviously, we participate in the community. We had a bunch of folks, along with others addressing that, and then we rolled our patches. Our patch roll-out went back all the way to version 3.2, 3.2 shipped in early 2016. Now, the one hand you say, hey, everyone has Dev-Ops, why do you need to have a patch for something that's from 2016? That's because customers still aren't moving as quickly as we'd like. So, I just want to temper, there's an enthusiasm with regard to, everyone's quick, everything's lightning fast. At the same time, we often find-- and so, going back to your question, we often find some enterprises will just take a little bit longer, in reality to kind of get-- (both speaking at once) >> Work loads, they're not going to be moving overnight. >> That's right. >> So there's some legacy from those workloads. >> Right, right. And so, what we want to do is ensure, for example, the platform. So we talked about the security and lifecycle. But, is supporting these Cloud Native, next generation, stateless applications, but also established legacy stateful applications all on the same platform. And so the work we're doing is ensure we don't-- you know, it's like, leave no application behind. So, either the work that we'll do, for example, with Red Hat Innovation Labs. We help sort of move that forward. Or with GSIs, global integrated, real integrators to bring those to bare. >> Ashesh, wonder if we could drill a little bit. There's a lot of re-training that needs to happen. I've been reading lots on there. It's not, oh, I bring in this new Cloud Native team that's just going to totally re-vamp it and take my old admins and fire them all. That's not the reality. There's not enough training people to do all of this wonderful stuff. We see how many people are at this show. Explain what Red Hat's doing. Some of the training maturation, education paths. >> So we do a lot of work on the just core training aspect, learning services, get folks up to speed. There's work that happens, for example, in CNCF. But we do the same thing around certifications, around administering the systems, developing applications, and so on. So that's one aspect that needs to be learned. But then there's another aspect with regard to how do we get the actual platform, itself, to be smart enough to do things, that in the past, individual people had to do? So, for example, if we were to sort of play out the operator vision fully and through execution. In the past, perhaps you needed several database admins. But, if you had operators built for databases, which, for example couch, base, and mongo, and others, have built out. You can now run those within the platform and then that goes and manages on behalf. Now you don't need as many database admins, you free those people up now to build actual business innovation value. So, I think what we're trying to do is increasingly think about how we sort of, if you will, move value up the stack to free up resources to kind of work on building the next generation of services. And I think that's our business transformation work. >> And I think, even though digital transformation is totally over-hyped, which I agree, it actually is really relevant. Because I think the cloud wave, right now, has been certainly validated. But what's recognized is that, people have to re-imagine how they do their infrastructure. And IT is programmable. You're seeing the network. The holy trinity of IT is storage, networking, and compute. So, when you start thinking about that in a way that's cloud-based, it's going to require them to, I don't want to say re-platform, but really move to an operating-environment that's different, that they used to have. And I think that is real. We're seeing evidence of that. With that in mind, what's next? What do you guys got on the horizon? What's the momentum here? What's the most important story that you guys are telling here at Red Hat? And what's around the corner? >> Yeah, so obviously, I talked about a few announcements that we made right around Open Shift Dedicated and the upgrades around that. And things like, for example, supporting bring-your-own-cloud. So, if you got your own Amazon security credentials, we help support that. And manage that on your behalf, as well. We've talked this week about our support native, trying to introduce more server-less technologies into Open Shift. We announced the contribution of SCD to the Cloud Native Computing Foundation. So, continuing re-affirming our commitment to the community I think looking ahead, going forward, our focus next year will be on Open Shift four, which will be the next release of the platform. And there, it's all about how do we give you a much better install than upgrade experience than you've had before? How do we give you these clusters that you can deploy in multiple different environments and manage that better for you? How do we introduce operators to bring more and more automation to the platform? So, for the next few months our focus is on creating greater automation in the platform and then enabling more and more services to be able to run on that. >> Pretty exciting for you guys riding the wave, the cloud wave. Pretty dynamic. A lot of action. You've guys have had great success, congratulations. >> Thank you very much. >> You're fun to watch. The Cube coverage here. We're in Seattle for KubeCon 2018 and Cloud Native Con. I'm John your host. Stay with us for more coverage of day one of three days of coverage after this short break. We'll be right back. (upbeat music)

(upbeat music) >> Hey welcome back here, buddy. Jeff Frick here from theCube. We're in our Palo Alto studios for a Cube Conversation and we've talked about it time and time again, right? It's the big companies that have the big shows. We do a lot of those big shows, but it's really the startups that really makes Silicon Valley Silicon Valley. They're constantly starting, people are leaving companies, starting new companies, and this is a great story, a company who actually visited in 2016 or had a quick catch up at RSA and we're excited to get an update two years later. And so to welcome to the studio, Amiram Shachar, he's the founder and CEO of Spotinst. Amiram, great to see you again. >> Absolutely, great seeing you again, as well. >> I couldn't believe it's been since 2016 when I looked it up and that was in spring, I guess, so a lot of stuff has happened in the last two years. Give us an update on Spotinst. >> Woah, how do I summarize two years of a startup? Every quarter is like a year for a startup, right? So, I think, right now, we're just... We've been like three employees when we talked last in 2016 and now we're over 100. Grew the company from like... Today we're headquarters in San Francisco, office in New York, office in Tel Aviv. Grew our customer base to like over a thousand today. >> Over a thousand customers. >> Over a thousand customers today and just keeping on, trying to keep the growth on. >> Right. Well you made a smart move early on as you connected your... Your train to the rocket ship that is public cloud and I think when we first talked a couple years ago, you were participating in the AWS marketplace and now you've since added, I think you said Google and obviously Microsoft Du Jour. So again for the people that don't know Spotinst, give 'em kind of the quick 101. >> Yeah, so, if you look about a cloud infrastructure space so Amazon was like the leader since we all knew what is cloud infrastructure, and cloud infrastructure, by definition, they have excess compute capacity. Excess compute capacity is there for support natural growth and support spikes in demand of AWS customers so Amazon always want to take these excess compute capacity and have it available for customers to purchase it. >> Right. >> But still, they want to have some access to that capacity whenever they need that so there is no guarantee, there is no SLA. So what we wanted to do to enable customers to use that excess compute capacity, because they can buy it in very cheap price, and we are the software that helps them to get the SLA. So that's what Spotinst does, enabling companies to unlock more compute for a reasonable price. >> So do you buy it and then resell it back to them so that you can control the management and or apply kind of your SLA type of tools or does your software sit there and the customer, they're still making that purchase directly through Amazon, but the softwares executing those details on their behalf? >> So that's the ladder. >> Okay. >> We're not like sitting between the customer and the cloud and buying and selling. We're just providing our software to the customers, enabling the customers to use that smart software so they can leverage compute more easily. >> Right. So what are they key components that take the Spot instance that doesn't have an SLA and makes it kind of SLA-worthy for your customers? >> That's a great point. A key component is statistical analysis that we're doing behind the scenes, is an AI-based platform that basically, we're always looking at the trends that AWS terminates capacity, so that basically tells us, alright, on Mondays, AWS reacts like this and on these hours, this is how you can get capacity, so basically our statistical model can tell the customer, hey, on 7:00 a.m. you should switch from one server to another before AWS takes it away from you. So that's how we bring SLA to a non-SLA compute. >> Right. >> Because we know what's probably going to happen. >> So how does Amazon sell that spot? Is there some, you buy it by a time duration so you know you at least can run a job without worrying about it suddenly going away in the middle of your job? Or how is it actually priced and bundled? >> So there are several ways. The most common way is just get spot capacity and whenever AWS needs that capacity back, they will take it away. And then you are >> So what happens if you're running a job? >> So you are as a customer, you need to take care of that. >> Okay >> You need to make sure that >> Does he get a warning flag or something? Hey we're taking this away in >> You get two minutes notification >> You get two minutes, okay. >> So sometimes, yeah, it's more than enough and sometimes, just you cannot handle with two minutes. >> Right. >> That's why you really need to choose which type of app you would probably want to use for a spot, but the good thing is that with our software, you don't have to worry about that, because you basically tell the software, my app runs and we need X amount of minutes, we need X amount of compute to complete our job and then we make it happen. >> Right, right. So do most of the customers then use this for specific jobs that they want to run, that they know are going to take X amount of compute power and run for an approximate level of time so they can schedule it, whether it's some type of a batch job or an end of quarter run or those types of things or can they actually start to integrate it into their actual operational software that's running pretty much all the time and it's really more just a resource shift, based on economics? >> Yeah, that's a great point because historically, if you look at Spot, Spot was exactly for what you've mentioned, which is badge jobs, things you need to schedule, you know that it's going to take you X amount of time to complete specific workload. >> Right. >> And that's what people did with Spot and the way we're looking at it is like the next generation of even new applications like web services, like containers, like any type of an application layer can use Spot just because we take... We leverage the fact that these applications that we're building today are all highly available, highly resilient, full tolerant by definition, so we know if you know to orchestrate Spot replacement in a very, very accurate way, you'll be able to run workload forever on Spot Instances without even noticing a single interruption. >> Interesting. 'Cause you're just kind of shifting, you're reacting to the Spot market dynamically, >> Correct. >> using your software. >> Correct. >> Very cool Now another thing we talked about before we turned the cameras on, you've got some good visibility, based on the software, as to what people are doing, and you made a really interesting comment on the rise of Kubernetes. We first heard about Kubernetes, I think it... Well, actually, we got the story from Craig at... It was a thing called Google Cloud Platforms. >> Yeah. >> Like Google Live or... In 2014, in the story of the naming, but you said that you've really seen a significant change in the landscape over the last year or so. Give us a little more color on that. >> Yeah, that's correct and the funny thing here is that we didn't see it coming like two years ago. When we've discussed, we didn't even know what's Kubernetes is. We know that containers are going to be the big next thing because it's so easy to deploy applications with containers, but then you had so many different options, right? You had Kubernetes and Amazon had their own stuff and Docker released their own stuff. But then in the past year, we just seeing something phenomenal that we've never seen before or never seen in any other area in our company, which is everybody just consolidating around Kubernetes as an orchestration layer for containers. >> Right, right. And we've... We hear that all the time but it's interesting, you're actually seeing it in the execution of what people are purchasing. Well, exciting. So another big part of the news, you said you got some new funding so give us kind of the details there and what are you going to do with some of this capital? What are... Hopefully it won't be two years till we see each other again. What are some of your priorities looking forward? How are you going to deploy some of this capital? >> Yeah, so, yeah. Gladly, we were able to secure another funding round and it's just because there is such a big opportunity in front of us to capture. The growth has been phenomenal in the past two years. Deloitte has crowned us as the fastest growing startup in Israel last year, in 2017. We grew more than 1400%, year over year and just seeing the opportunity in front of us, like replicating the same thing we did for AWS customers and doing it in other clouds as well, like Google and Azure, and seeing all this rocket ship, as you said, cloud infrastructure space, just continuing to grow in such pace year over year, we're just going to deploy all that capital into growth. >> Right. Well, very exciting and congratulations and thanks for coming and giving us the update. >> Absolutely, thank you. >> Alright. He's Amiram, I'm Jeff, you're watching theCube. We're in our Palo Alto studios having a Cube Conversation. Thanks for watching. We'll see you next time. (upbeat music)

>> Announcer: From Berlin, Germany, it's the Cube. Covering NetApp Insight 2017, brought to you by NetApp. Welcome back to the Cube's live coverage of NetApp Insight here in Berlin, Germany, I'm your host Rebecca Knight along with my cohost Peter Burris. We are joined by Manfred Buchanan, he is the VP systems engineering IMIA for NetApp and Mark Carlton who is an independent IT consultant. Manfred, Mark, thanks so much for coming on the show. Thank you. Thank you for having us. So Manfred, I want to start with you, you're a company veteran, you've been with NetApp for a long time, lets talk about the data management innovations that make IT modernization possible. It's a big question. That's a great question, you know, as a veteran talking about AI and the future and data management, things make it capable, but just coming off the general session, it takes something like our object store and think about, I put an object, a picture from you, I just put it into the storage and you know, it gets handed over into Amazon analytics and Amazon analytics, oh, you are smiling. And think about this without any coding and just few things to pluck it together and it works and if you take it further it works at scale so it's not only your face, it's the two thousand, four thousand, ten thousand faces here. You just put it in in parallel at scale Amazon at scale does the analytics on top and you get the results back just as a blocking in architecture, this data management at scale is this innovation. Is this the next gen data centers, all of them. But it's not magic, something allows that to happen. So what are those kind of two or three technologies that are so crucial to ensuring that that change in system actually is possible? I will put it pretty simple, the core technology we provide connect the non premise data center with the public cloud and make this whole thing seamless happen. And make it happen for all different protocols. You have it in the send space and then an ice class in the cloud, you have it on files on premise move the file over, and you have it with an object, and an object even we go further we integrate it into message pass. Maybe it's too technical but a message pass is just I got an event and I tell someone else this event coming to something and that's what we do with the picture analyzers. I got an event, which is, I get the picture, and with this event, I tell Amazon please do something with the picture and I give you the picture to analyze. So it's a fabric, there's object storage and there's AI and related technologies that allow you to do something as long as the data is ready for that to be done. Yeah and even move to data with it basically that's what we do. And if you think about it's unbelievable magic. Mark I want to ask you, you are, you're an independent IT consultant, you've been following NetApp for a long time, you have your own blog what are some of the biggest trends that you're seeing, what are some of the biggest concerns you hear from customers? Really from customers it's more around what steps to take the markets changing as we can see what we were saying there with data sprawling and it's spreading so fast, it's growing so fast. What we were storing a few years ago a few years ago when I first started someone talked about a terabyte and you thought that's a big system or you got 50 terabytes and you were huge. Now we're talking about 500 terabytes, 100 terabytes and the difference is is what sort of data that is. Is it stored in the right place? And I think that's one of the biggest challenges is knowing what data you have, how to use it and how to get the most out of the data that, and in the right place so we talked about the on prem, on process whether it be in the cloud, whether it be an object and I think that's key from where we're moving with the data fabric within NetApp and how NetApp's creating their data management suite as such for on tap, for the solufy suite and how they're joining the products up so it makes it seamless that we can move this data about from these different platforms. And I think one of the biggest things, biggest thing for me, especially when I'm talking to customers is it's the strategy of what you can do with data. It's the, it's there's no complications, as Manfred said, it's as if it's magic, it's that type of thing, it will go, you can do whatever you want with it. And I think from a customer point of view because they don't have to make that choice and say that's what I want to do today they've got scale, they've got flexibility, they can control where their data sits, they can move it back and forth and the sprawl out into AWS this year and then Google and with a cloud that size and being able to use those three different cloud platforms, even IBM cloud and how they can plug into theirs. It's, it's really starting to open those doors and really argue the point around the challenges. You've got a lot of answers to a lot of different things. So how do you help customers make sense of all of this, I mean as you said, there are a lot of options, they can go a lot of different ways, they know that they need to use their data as an asset, they need to, they need to deploy it find that value, what's your advice? You know let me just also take a step back, we talk about we get more and more data. We talk about connecting the different clouds, but at the same time we also talked about basics I move from fresh into search class memory and I make everything faster. If you think about more data, to process more data in the same time everything needs to go faster and I give you a simple example or just challenge you, how many have you sitting before a business application in your company and you sit, you press an enter button and it takes, takes a minute, takes another and you go, uh, sorry. Thinking about it. Why does it take so long? As a veteran in the old days, what we said is basically, we press the enter button and we said we need to go for a coffee and come back and after the coffee the transaction is done. Now we talked about one stage about microseconds and milliseconds and all these things but put it into relation, take a transaction I press the enter button and it would have taken let me say 10 minutes until I got a result out of it. And this was in times of when storage response times were 10 milliseconds. Take this one into response time is now one millisecond and you do the same amount of data, you press the enter button and it's not 10 minutes, it's a minute. Now you say the next generation technology we showed, it's even a thousand times faster. You go now from a minute, to a thousand of a minute, a millisecond, you know what a millisecond means for you? You press the enter button, result is there. And now you think you get more and more data petabytes of data, how can I make sure and process it as fast as possible? So that's one character you look into and I believe the future is also for AI and all these things is how fast can you process, maybe we get a measurement which called petabytes per second or petabytes per millisecond can you process to get information out of it. And then at the same time you said which solution, which choices? I believe in the current world, as it's so fast moving, all the solutions evolve at a high speed so at a certain time you just make a decision, I just go with this one and even if you go with the public cloud, you choose the public cloud, one is price but also choose it on capabilities, if you go to the IBM side, what an IBM Watson is doing in terms of AI, incredible and that's what we use for actify queue in the support side so it's not only the system, the speed of the system, where do you ploy the data, but at the same time I give you all the information, what are you doing with your data on the support side? You're connecting this and customers will choose like we do it internally the best solution and what we give them, we give them the choice, we give them reference architectures, how it works with this one, how it works with this one, we may give them some kind of guidance but to be frank and as a veteran and sometimes as the guys know me, I'm straightforward, the decision is something the customer needs to make or the partner with the customer together because you have the knowledge basically on the implementation side, need to make, I'm the best one in this one, I know how it works, I know how I can do it, but that's a choice which is more under customer together with their implementation partners. Great, well Manfred, Mark, thanks so much for coming on the Cube, this was great, great having you on. Thank you very much. I'm Rebecca Knight, for Peter Burris, we will have more from NetApp Insight just after this.

>> Announcer: From Hell's Kitchen in New York City, it's theCUBE on the ground at Serverlessconf brought to you by SiliconANGLE Media. >> Hi, I'm Stu Miniman here with theCUBE and we're at Serverlessconf in New York City in Hell's Kitchen. Happy to have on the program a first time guest, Linda Nichols, who is does Cloud Enablement Reader at Cloudreach. Linda, thanks so much for joining me. >> Thanks. >> Alright, so, it's the fifth one of these events, the first time we've been doing some interviews. I know I'm excited to be here. Tell our audience a little bit about yourself, Cloudreach and what brings you to the event. >> Sure, well, I'm at this event because I love this community. I'm really passionate about Serverless. I was at the event in Austin, I loved it, I had a great time. I submitted talks this time and they accepted mine. And I was so excited. Honestly, I would have come anyway, even if they hadn't invited me. So I work at Cloudreach, it's a company originally based in London, we have an office here in New York and we're a Cloud adoption company. So we're helping companies go from on-premises servers into the Cloud and then once they're in the Cloud, that's sort of where my team comes into play. Where we work with app-modernization, taking the software apps that are now in the cloud, and helping to break apart monoliths and modernize the apps using Serverless. >> Yeah, Linda, tell me a little bit about the community. Because you talked Cloud adoption, most companies I talk to, they're figuring out their Cloud strategy. Some of them are getting on board with containerization, coo-ver-net-tees is the latest hotness, so Serverless is still new, so tell us a little bit about that community, how long you've been a part of it and what is it that excites you so much about it? >> It's been about a year and I think as soon as I started kind of getting into it and creating apps on my own and kind of doing some things for clients, immediately the community was there. I was on Twitter, I was on Gitter, I was talking to Serverless framework people, asking questions and immediately people came back with answers. Yeah, they've really embraced me and everyone else really quickly. And I think that when new people come on the scene and they say, what is this? People in the community are like, we don't really know either, it changes every day. Every time I see a talk from someone, their definition of Serverless is different. And mine is changing, too, with every talk. >> I know we've had that discussion, kind of what is it, but what are the outcomes? What are you excited about? What's helping your users? Any proof points or roll outs or things that have- what has that game changer been? >> I think it's cheap and it's fast. Those are the two really important things, especially with a startup community. They don't have the money, they don't have the funding to really be having an entire development team. And now they can bring in one or two people and they can get something written and deployed really quickly. It's good for prototyping, non-profits, and now, for enterprises too. 'Cause now we're saying it's not just for non-profits, you can save money too. We've brought you into the cloud, you're more secure, you're saving money and now, we're going to save you more money and we're going to make your developers happy too. 'Cause they're having a great time. >> Yeah, I've been looking in the events, so far, and it seems like there's big focus on tooling, helping to understand really digging into it. Because, yes, fast, easy, let me get up, I can save some money, but, there's always the wait, but. Okay, we know we need to work on security. I need to make sure I have visibility. What have you been seeing? What are you impressed that you've seen so far? And what are some of the open things that you think the community still needs to work on? >> Well, one thing that's really interesting is you have the four Cloud platforms and they have similar products which are competing, but they still really are working together. IBM and Google are hanging out behind us, no pressure there really and they're all like, oh great, you have a new tool. That seems cool, it's like what we have. Maybe we can work on ours, make it better. So, they're kind of working together. I think the thing that, maybe, we have to work on is maybe a little bit of standardization, which I think is kind of starting to happen. Because people want to be able to use a hybrid system, or maybe they use multiple Cloud platforms and so standardizing some of the events and the services I think is going to kind of help that. >> Okay, Linda, I want to give you the last takeaway. For people that don't know about Serverless, haven't attended, and any tools or place of view, how do they get started, how do they get into the community that you love so much? >> I think, I would say, start with AWS Lambda, maybe. There's some tutorials on the site. A Cloud Guru has some great tutorials, I have to go give them a plug. And, just start building something. And once you start building, if you have a problem, reach out to the community, they'll help you. They'll answer your questions. >> Absolutely, A Cloud Guru, of course, puts on this event. Really, not only are they, they use the Serverless to be able to build their company, but dramatically, those price points, though. Less time and less money to get involved. Linda, thanks so much for joining us, really appreciate, great, great talking with you. >> Yeah, thanks for having me. >> Thank you so much for watching theCUBE. (electric bubbly music)

(upbeat music) >> Hello, and welcome to theCUBE special coverage of Sapphire Now we're here in Palo Alto. Sapphire now SAPs premier conference in Orlando. We are in Palo Alto, we have folks on the ground in Orlando. Special three days of wall-to-wall coverage. Tuesday, Wednesday, and Thursday. Taking you through all the action from our new studio in Palo Alto, 4,500 square feet. Our chance to cover events when we can't get there in person we certainly can cover it from here. And that's what we're going to be doing for the next three days; we're going to have stories on the ground, no story is too small. We're going to chase 'em all down. We have people calling in, we have folks on the ground that'll be Skyping in, calling in, whatever it takes to get the story out to you, we're going to do it and, certainly, expert coverage from inside the studio here. We got George Gilbert from Wikibon and a variety of folks who did not make it to Orlando will be coming into Palo Alto to sit down and talk with us. I'm John Furrier, my co-host is Jeff Frick. Jeff, we'll do whatever it takes. We'll cover from our studio, we'll go to Orlando virtually we got the Twitter hashtag, Sapphirenow, we're on that. We have folks on the ground, a lot of great news coming out of Sapphire. >> What do ya think? I mean, you were just as Dell EMC World last week and the story was all about, kind of, hybrid cloud and customer choice and it sounds like that's a recurring theme here at SAP, where they've got a lot of cloud options based on what their customer wants to do. >> I mean, if you, I mean this sounds really bad to say for someone who follows the tech industry but I just think this digital transformation thing is just over-played. But it's the, it's the Groundhog's Day moment. The movie just keeps replaying itself. Digital transformation, digital transformation, and, again, just like every other commerce, like Dell EMC World and every other one, digitally transforming your business is the theme. Little bit played, I would say business transformation is, I would say, the next chapter of what's happening and what you see from these shows. Specifically, at Dell EMC World, US ServiceNow, OpenStack, all the different events, Red Hat's been the one we been going to this past couple weeks is the business impact of the technology and SAP highlights that with their results and their keynotes in the news letter drops today, which is, look it, they have been doing SAP for all the top companies powering with SAP. As in Oracle. But now the customers want to go beyond the legacy SAP. And this has been a challenge for SAP over the past five years. They've had all the right messaging, digital dashboards, real time for business, all there. But the problem was they were missing a big piece of it. That is a cloud native and really aligning with the explosive growth of cloud computing, cloud native. Which is the new application developer. This new class of developer is emerging and that's different than the in-house SAP guys, by the way, which is still a massive market. >> Sure. >> That's the big trend. And of course, machine learning, AI, the kinds of design tooling that you'd expect to see, they're calling that Leonardo. >> I think it really shows the power of the consumer and the impact that the big public clouds have had on the marketplace, right? With Google, and with Amazon, especially Microsoft, as well, coming into play. And I think it's, what's interesting on the SAP tact is they have their own cloud. But now they've, you know, are very aggressively following up on an earlier announcement at Google Cloud Platform Show. With more announcements at this show and then they continue to strengthen their relationship with Amazon. So, it's a pretty interesting place, if you're an SAP customer, really having options around where, what cloud and what cloud deployment is really no longer an argument. You've got a lot of options at SAP, very different than Oracle, which is still pretty much exclusively Oracle on the Oracle cloud. Very different kind of a tact. >> Yeah and just reading the hard news from from hitting the ground today down in Orlando is the key points, I'll just summarize it real quick. Expanded SAP Leonardo, Digital Innovation System, SAP Google Expand the Strategic Partnership, SAP Cloud Platform accelerates adoption and proves choice advances consumption for customers. That, essentially, is it. And there's a lot of other subtext going on on Enterprise Cloud, a lot of other massive pockets. But in terms of top-level news, it's Leonardo, okay? Leonardo Da Vinci, dead, creative genius. Okay? But that is all about providing the tools for business to be successful in a digital world. But to me, the big story, Jeff, is the transformation of what used to be called HANA Cloud Platform to SAP Cloud Platform. This is their platform as a service bet around winning the new developers, the cloud native. Last year at Sapphire, we actually had theCUBE on the ground they announced a deal with Apple computer around iOS and developers. That, now, has chip as a general availability so you're seeing SAP bringing two worlds together. The Cloud Native World, which they never played in much to the SAP Eco System, which is flush with cash. There's a ton of money to be made in that world. The install base is massive, now you have Cloud-Computing Hybrid Cloud with the HANA Cloud Platform, I mean the SAP Cloud Platform to bring that in. Again, I still can't even get it right. >> And so, let's just break it down as simply as you can, John. Why do they change the name? And what exactly do they have today? >> Well, here's the first of all problem. I'm so used to saying HANA because they have been branding HANA on >> They been bangin' HANA for the decade, or forever. >> It's just like, in my brain. I just can't get it out. SAP HANA, so anytime, and they actually called it HANA Cloud Platform before. >> Right, right. >> But HANA is such a massive set of capabilities that they really wanted to break out the platform as a service, which is the Cloud Native play, where all the action is for developers. From HANA, a viable product that they have that everyone's using. So, they have two clouds that we can say. SAP Cloud Platform, that's in Cloud Native, and then, HANA Enterprise Cloud. One's a delivery mechanism and one's a developer environment; it's the way I like to think about it. I'm a HANA customer, I'm going to need Enterprise Cloud to take my HANA solution and extend it up with self-service or provisioning, some partnership with AWS Google and the different clouds, getting my legacy HANA Enterprise software to be cloud enabled. That's HANA Enterprise Cloud. SAP Cloud Platforms for folks who don't, who like DevOps, the Cloud Native world that we cover deeply. >> Okay, and then, how do you look at the kind of Google partnership, Google Cloud Platform versus AWS partnership. SAP's goin' dual-track, is it just simply to have choice based on what their customers, are they fundamentally different relationships? How do you read that? >> This is where I think SAP's got genius going on. But if they might screw it up because they can't get out of their own way. >> Jeff: Can't use genius anymore, we've had enough geniuses. >> So, so, this could be a brilliant strike of move for SAP. I think it's a brilliant move in the way they're playing it out. But, again, like I said, SAP, they might not be able to get out of their own way. That's going to be their issue. But from a functionality standpoint, this multi-cloud opportunity; they've been with Amazon for many many years. They announced a partnership with Google which is just kind of toe in the water. That's tryin' to advance pretty quickly. Not a lot of meat on the bone there. And Azure relationships. So, SAP wants to put their cloud platform, that platform as a service, in all the different major clouds so that their legacy can work on pram and in whichever cloud the customer chooses. >> Yeah, I think there is, >> I think, that is a multi-cloud strategy that is viable for SAP. Unlike, say, Oracle, which isn't multi-cloud, it's Oracle Cloud. >> Right, right, right. >> So, you know the SAP Oracle, you know, head-to-head thing has been kind of, like, taking completely different paths. Someone will be right. >> Right. But I think there's more meat on the bone with the Google thing than, maybe, maybe we know of, or are aware of, or whatever. I mean, Burnt did come and get in the keynote with Diane Greene at Google Cloud Platform. And, you know, I think it's relatively significant. What'll be interesting to see how it shapes out and, again, what are the customer choices that are going to drive them to Amazon or to SB Cloud or to the Google cloud. I guess at the end of the day it's about choice and I know that was a big theme at Dell EMC World. Is that everyone has to cater to the choice of the customer or else it's just too easy for them to flip a lot of these other clouds. >> I mean, when I say, "not ready for primetime," I mean, Google's got a lot of work to do. SAP as a company is not as far down the road with Google as they are with Amazon and Azure, just to make my point clear. >> Okay. >> But the do have our announcing additional certifications of the coinnovation between SAP and Google. Between SAP Cloud Platform and Google Cloud Platform. IOT, machine learning, they certified SAP NetWeaver in a variety of S4 HANA, business warehousing; essentially more market place to accelerate the digital transformation. And, again, this is all about SAP co-locating in Google. >> Right, right. >> If a customer wants to take advantage of TensorFlow and all the goodness of, say, Google. That's a good move for SAP and, again, I think this is a brilliant strategy for SAP if they don't screw it up. >> Right, right. And potentially, that's the bridge to, like you said, it's been a little bit of Groundhog Day with cloud, cloud, cloud. But what's really the theme of 2017 is AI machine learning and it's an interesting bridge with Google Cloud, to their TensorFlow as another way to bring AI machine learning into the application learning into the application. >> So, Jeff, we've been covering a lot of events. One comment, I will say, is that SAP always has great messaging. >> I got to say, because we've been covering out eighth year covering Sapphire Now. We've only missed, like, two years over that time span. It's a lot like Oracle on the sense that it's a very business oriented event, but they have good pulse. Bill McDermott, great communicator, great customer-focused person. Always has his hand on the pulse. They have great messaging. And they tend to pick the right waves. And they've had some false starts with cloud, they've bought, had some acquisitions, things been cobbled together, but they've never wavered from their mission. And the mission has always been powering the speed of business, great software solutions. The issue is, they're moving off of SAP to new cloud solutions, so SAP is taking a proactive strike to say, look here, we can play in the cloud, therefore this multi-cloud game is critical for the growth of SAP, in my opinion. >> How much of the SAP in cloud will be new greenfield opportunities, or people want the flexibility, and a lot of the attributes of cloud versus, they're not migrating old R3 instances into the cloud. I mean, this is, I would assume, mainly new greenfield opportunities. >> Well, I think it's both. I mean, I think you have greenfield developers basically that are being hired by their customers to build apps, top line driven apps, and also, you know, some consolidation apps. But mainly, you know, their customers are hiring developers. Hey, we need a mobile app for our business, so you need to have data, you need to have some domain expertise. But at the end of the day, the system of records probably stored in some SAP system somewhere. So what they're trying to do is decouple the dependency between that developer, but still use SAP, but and offer an extension of SAP. It really is an opportunity, in my mind, for that to happen, and also partners. Look at Accenture, Capgemini, all these different partners. They are poised to create some great value and make some cash along the way. Remember the minicomputer boom. People who lined their pockets with cash were the integrators. The large global system integrators. So I think that, and the channel partners are going to have a great opportunity to take advantage of preexisting legacy accounts and to grow them further. >> Well, they certainly have a giant ecosystem. There's no doubt about it. It's one of the startup challenges that, new company starters to build that ecosystem. I mean, they have a giant ecosystem. So, what are you looking for this week besides the obvious announcement? And kind of tells that you want to see to let you know that SAP continues to be on track and move with the shifting tides of the market trends? >> Well do me, I'm looking at the multi-cloud story. It's a good story. Not sure how baked it is, but from a story standpoint, I really like it. I think that whoever can really crack the code on multi-cloud in a viable way is going to be a winner. So to me, I'm going to be looking heavily at the multi-cloud stuff coming out of Orlando. I'm interested to see how the developer traction pans out. I'm really interested in following up on the Apple relationship and see how that pans out. And then ultimately, how the rest of SAP can transform as a business. Because SAP tends to have a lot of buzzwords, a lot of word salad, not a lot of, you know, breaking it down and orchestrating. So to me, SAP, where I'm critical of them is, they kind of can't get out of their own way, Jeff. So, sometimes they kind of get caught in that old world thinking when the world is moving very very fast. Look at Amazon Web Services, you look at what Google's doing, you look at where Vmware is changing. Vmware started Pat Gelsinger. He was in the dumps in 2016, now he's flying high. He went from almost being fired, stock had a 52 week low, to them soaring. They have a market cap that's greater than HPE. So these old incumbent like SAP, they have to transform their culture, get relevant, and get real. And if they can't show the proof points with customer wins and partners, and multi-cloud, then they're going to be on shaky ground. So that's what I'm looking for. >> Jeff: All right, so should be a good week. I'm looking forward to it. >> Okay, we are here in the Palo Alto studio, our new 4,500 square foot operation. We can do coverage here, and then have on the ground coverage of which we will be doing all week Tuesday, Wednesday, and Thursday for our SAP Sapphire Now. We've got great guests coming in, great editorial coverage. I want to thank our sponsors, SAP, for, you know, allowing us to do this and continuing theCUBE tradition at Sapphire Now. I'm John Furrier with Jeff Frick. More coming after this short break.

>> Announcer: Live, from Boston, Massachusetts, it's the Cube. Covering Red Hat Summit 2017. Brought to you by Red Hat. (futuristic tone) >> Welcome back to the Cube's coverage of the Red Hat Summit here in Boston, Massachusetts. I'm your host, Rebecca Knight, along with my co-host Stu Miniman. We are welcoming right now Sam Ramji. He is the Vice President of Product Management Google Cloud Platforms. Thanks so much for joining us. >> Thank you, Rebecca, really appreciate it. And Stu good to see you again. >> So in your keynote, you talked about how this is the age of the developer. You said this is the best time in history to be a developer. We have more veneration, more cred in the industry. People get us, people respect us. And yet you also talked about how it is also the most challenging time to be a developer. Can you unpack that a little bit for our viewers? >> Yeah, absolutely. So I think there's two parts that make it really difficult. One is just the velocity of all the different pieces, how fast they're moving, right? How do you stay on top of all the different latest technology, right? How do you unpack all of the new buzzwords? How do you say this is a cloud, that's not a cloud? So you're constantly racing to keep up, but you're also maintaining all of your old systems, which is the other part that makes it so complex. Many old systems weren't built for modernization. They were just kind of like hey, this is a really cool thing, and they were built without any sense of the history, or the future that they'd be used in. So imagine the modern enterprise developer who's got a ship software at high rates of speed, support new business initiatives, they've got to deliver innovation, and they have to bridge the very new with the very old. Because if your mobile app doesn't talk to your mainframe, you are not going to move money. It's that simple. There's layers of technology architecture. In fact, you could think of it as technology archeology, as I mentioned in the keynote, right, this we don't want to create a new genre of people called programmer archeologists, who have to go-- >> I'm picturing them just chipping away. >> Sam: I don't think it'll be as exciting as Indiana Jones. >> No. >> Digging through layers of the stack is not really what people want to be doing with their time. >> Sam: Temple of the lost kernel. >> I love it. >> So Sam, it's interesting to kind of see, I was at the Google Cloud event a couple months ago, and here you bring up the term open cloud, which part of me wants to poke a hole in that and be like, come on, everybody has their cloud. Come on, you want to lock everybody in, you've got the best technology, therefore why isn't it just being open because it's great to say open and maybe people will trust you. Help explain that. >> Puppies, freedom, apple pie, motherhood, right. >> Stu: Yeah, yeah. (laughs) >> So there's a couple sides to that. One, we think the cloud is just a spectacular opportunity. We think about 1.2 trillion dollars in current spend will end up in cloud. And the cloud market depending on how you measure it is in the mid 20 billions today. So there's just unbounded upside. So we don't have to be a aspirational monopolist in order to be a successful business. And in fact, if you wind the clock forward, you will see that every market ends up breaking down into a closed system and a closed company, and an open platform. And the open platforms tend to grow more slowly, sort of exponential versus logarithmic, is how we think about it. So it's a pragmatic business strategy. Think about Linux in '97. Think about Linux in 2002. Think about Linux in 2007. Think about Linux in 2012. Think about Linux today. Look at that rate. It's the only thing that you're going to use. So open is very pragmatic that way. It's pragmatic in another direction which is customer choice. Customers are going to come for things that give them more options. Because your job is to future proof your business, to create what in the financial community call optionality. So how do you get that? In 2011, about eight other people and I created a nonprofit called the Open Cloud Initiative. And the Initiative is long since dead, we didn't fund it right, we kind of got these ideas baked, and then moved on. >> Stu: There's another OCI now. >> That's right, it's the Open Container Initiative. But we had three really crisp concepts there. We said number one, an open cloud will be based on open source. There won't be stuff that you can't get, can't replicate, can't build yourself. Second, we said, it'll have open access. There'll be no barriers to entry or exit. There won't be any discrimination on which users can or can't come in, and there won't be any blockers to being able to take your stuff out. 'Cause we felt that without open access, the cloud would be unsafe at any speed, to borrow a quote from Ralph Nader. And then third, built on an open ecosystem. So if you are assuming that you have to be able to be open to tens of thousands of different ideas, tens of thousands of different software applications, which are maybe database infrastructure, things that as a cloud provider, you might want to be a first party provider of. Well those things have to compete, or trade off or enrich each other in a consistent way, in a way that's fair, which is kind of what we mean when we say open ecosystem, but being able to be pulled through is going to give you that rate of change that you need to be exponential rather than logarithmic. So it's based on some fairly durable concepts, but I welcome you to poke holes in it. >> So we did an event with MIT a little while back. We had Marshall Van Alstyne, professor at BU who I know you know. He's an advisor at Cloud Foundry, and he talked about those platforms and it was interesting, you know, with the phone system you had Apple who got lots of the money, smaller market share as opposed to Android, which of course comes out of Google, has all of the adoption but less revenue. So, not sure it's this, yeah. >> Interestingly, we've run those curves, and you kind of see that same logarithmic versus exponential shift happening in Android. So we've seen, I don't have the latest numbers on the top of my head, but that is generating billions of dollars of third party revenue now. So share does shift over time in favor of openness and faster innovation. >> So let's bring it back to Red Hat here, because if I talk to all the big public cloud guys, Microsoft has embraced open source. >> And they're not just guys, actually, there's lots of women. >> Rebecca: Yes, thank you. >> Stu: I apologize. >> Sorry, I'm in a little bit of a jam here, where I'm trying to tell people the collective noun for technologists is not guys. >> Stu: Okay. >> It could be people, it could be folks, internally we use squirrels from time to time, just to invite people in. >> So, when I talk to the cloud squirrels, Microsoft has embraced open source. Amazon has an interesting relationship. >> I was there when that happened. >> You and I both know the people that they've brought in who have very good credibility in the open source community that are helping out Amazon there. Is it Kubernetes that makes you open because I look at what Red Hat's doing, we say okay, if I want to be able to live across many clouds or in my own data centers, Kubernetes is a layer to do that. It comes back to some of the things like Cloud Foundry. Is that what makes it open because I have choice, or is there more to it that you want to cover from an open cloud standpoint, from a Google standpoint? >> Open and choice effectively is a spectrum of effort. If it's incredibly difficult, it's the same as not having a choice. If it's incredibly easy, then you're saying actually, you really are free to come and go. So Kubernetes is kind of the brightest star in the solar system of open cloud. There's a lot of other technologies, new things that are coming out, like istio and pluri. I don't want to lose you in word soup. Linker D, container D, a lot of other things, because this is a whole new field, a whole fabric that has to come to bear, that just like the internet, can layer on top of your existing data centers or your existing clouds, that you can have other applications or other capabilities layered on top of it. So this permission-less innovation idea is getting reborn in the cloud era, not on top of TCP/IP, we take that for granted, but on top of Kubernetes and all of the linked projects. So yeah, that's a big part of it. >> I want to continue on with that idea of permission-less innovation and talk about the culture of open source, particularly because of what you were saying in the keynote about how it's not about the code, it's about the community. And you were using words like empathy and trust, and things that we don't necessarily think of as synonymous with engineers. >> Sam: Isn't it? >> So, can you just talk a little bit about how you've seen the culture change, particularly since your days at Microsoft, and now being at Google, in terms of how people are working together? >> Absolutely, so the first thing is why did it change? It became an economic imperative. Let's look at software industry competition back in the 90s. In general, the biggest got the mostest. If you could assemble the largest number of very intelligent engineers, and put them all on the same project, you would overwhelm your competition. So we saw that play out again and again. Then this new form of collaboration came around, not just birthed by Linux, but also Apache and a number of other things, where it's like oh, we don't have to work for the same company in order to collaborate. And all of a sudden we started seeing those masses grow as big as the number of engineers who went a single company. Ten thousand people, ten thousand engineers, share the copyright to the Linux kernel. At no point have they worked at the same company. At no point could a company have afforded to get all of them together. So this economic imperative that marks what I think of as the first half of the thirty years of open source that we've been in. The second half has been more us all waking up, and realizing open source has got to be inclusive. A diverse world needs diverse solutions built by diverse people. How do we increase our empathy? How do we increase our understanding so that we can collaborate? Because if we think each other is a jerk, if we get turned off of building our great ideas into software because some community member has said something that's just fundamentally not cool, or deeply hurtful, we are human beings and we do take our toys away, and say I'm not going to be there. >> That's the crux of it too. >> It's absolutely a cutthroat industry, but I think one of the things I'm seeing, I've been in Silicon Valley for 22 years, less three years for a stint at Microsoft, I've actually started to see the community become more self-reflective and like, if we can have cutthroat competition in corporations, we don't have to make that personal. 'Cause every likelihood of open source projects is you're employed as a professional engineer at a company, and that employment agreement might change. Especially in containers, right? Great container developers you'll see they move from one company to another, whether it's a giant company like Google, or whether it's a big startup like Docker, or any range of companies. Or Red Hat. So, this sort of general sense that there is a community is starting to help us make better open source, and you can't be effective in a community if you don't have empathy and you don't start focusing on understanding code of conduct community norms. >> Sam, I'm curious how you look at this spectrum of with this complexity out there, how much will your average customer, and you can segment it anywhere you want, but they say, okay I'm going to engage with this, do open source, get involved, and what spectrum of customers are going to be like, well, let me just run it on Google because you've got a great platform, I'm not going to have Google engineers and you guys have lots of smart people that can do that in any of the platform. How do you see that spectrum of customer, is it by what their business IT needs are, is it the size of the customer, is there a decision tree that you guys have worked out yet to try to help end users with what do they own, what do they outsource? It's in clouds more than outsourcing these days. The deal of outsourcing was your mess for less, and this should be somewhat more transformational and hopefully more business value, right? >> Yeah, Urs Hölzle, who's our SVP of Technical Infrastructure, says, the cloud is not a co-location facility. It is different, it is not your server that you shipped up and you know, ran. It's an integrated set of services that should make it incredibly easy to do computing. And we have tons of very intelligent women and men operating our cloud. We think about things like how do you balance velocity and reliability? We have a discipline called site reliability engineering. We've published a book on it, a community is growing up around that, it's sort of the mainstream version of dev ops. So there are a bunch of components that any company at any size can adopt, as long as you need both velocity and reliability. This has always been the tyranny of the or. If I can move fast I can break things, but even Mark Zuckerberg recently said you know, move fast and break fewer things. Kind of a shift, 'cause you don't want to break a lot of people's experience. How do you do that, while making sure that you have high reliability? It really defies simple classification. We have seen companies from startups to mom and pop shops, all the way to giant enterprises adopting cloud, adopting Google cloud platform. One of the big draws is of course, data analytics. Google is a deeply data intensive business, and we've taken that to eleven basically with machine learning, which is why it was so important to explain tense or flow, offer that as open source, and be able to move AI forward. Any company, at any size that wants to do high speed, high scale data analytics, is coming to GCP. We've seen it basically break down into, what's the business value, how close is it to the decision maker, and how motivated is an engineer to learn something different and give cloud a try. >> Because the engineer has to get better at working with the data, understanding the data, and deriving the right insights from the data. >> You're exactly right. Engineers are people, and people need to learn, and they need to be motivated to change. >> Sam, last question I have for you is, you've been involved in many different projects. We look at from the outside and say, okay, how much should be company driven, how much does a foundation get involved? We've seen certain foundations that have done very well, and others that have struggled. It's very interesting to watch Google. We'd give you good as we've talked on the Cube so far. Kubernetes seems to be going well. Great adoption. Google participates, but not too much, and Red Hat I think would agree with that. So congratulations on that piece. >> Sam: Thank you. >> What's your learnings that you've had as you've been involved in some of these various initiatives, couple foundations. We interviewed you when you were back at the Cloud Foundry, and things like that, so, what have you learned that you might want to say, hey, here's some guidelines. >> Yeah, so I think the first guideline is the core of a foundation is, the core purpose of a foundation is bootstrapping trust. So where trust is missing, then you will need that in order to create better contribution and higher velocity in the project. If there's trust there, if there's a benevolent dictator and everyone says that person's fine or that company's fine, then you won't necessarily need a foundation. You've seen a lot of changes in open source startups, dot coms that are also a dot org, shifting to models where you say well, this thing is actually so big it needs to not be owned by any one company. And therefore, to get the next level of contribution, we need to be able to bring in giant companies, then we create trust at that next level. So foundations are really there for trust. It's really important to be strong enough to get something off the ground, and this is the challenge we had at Cloud Foundry, it was a VMware project and then a Pivotal project, and many people believe this is great open source, but it's not an open community, but the technology had to keep working really well. So we how do we have a majority contributor, and start opening up, in a thoughtful process and bringing people in, until you can say what our target is to have the main contributor be less than 50% of the code commits. 'Cause then the majority is really coming from the community. Other projects that have been around for longer, maybe they started out with no majority. Those organizations, those projects tend to be self-organizing, and what they need is just a foundation to build a place that people can contribute money to, so the community can have events. So there's two very different types of organizations. One's almost like a charity, to say I really care about this popular open source project, and I want to be able to give something back, and others are more like a trade association, which is like, we need to enable very complex coordination between big companies that have a lot at stake, in which case you'll create a different class of foundation. >> Great, well Sam Ramji, thank you so much for being with us here on the Cube. I'm Rebecca Knight, and for your host Stu Miniman, please join us back in a bit. (futuristic tone)

>> Man: Hold on, let me check. (musical fanfare) >> Narrator: Live from Silicon Valley, it's the Cube, covering Google Cloud Next '17. (busy electronic music) >> Okay, welcome back everyone. We're live in Palo Alto Studios, looking at media as the Cube, our new 4500 square foot studio where we can do broadcasts here, and of course we're covering a two day special, coverage wall-to-wall with Google Next 2017 in San Francisco. We just had the exclusive video with Sam Yen from SAP talking about the new relationship between Google Cloud Platform and SAP, SAP HANA, and also SAP Cloud platform. On the phone right now with reaction to the news in San Francisco is Akash Agarwal, GVP with SAP, Cube alumni, good friend. Akash, welcome to the Cube coverage and thanks for taking the time. >> Akash: Thanks John, we are proud to helping out. >> Akash, you've been intimately involved in a variety of very cool things with SAP. One of them has been the Apple announcement where you guys have a strategic relationship with Apple Computer, and at Mobile World Congress you've released the general availability of the developer kit, SDK, now shipping. On the heels of that amazing news, you now have a deal with Google Cloud. You also have a deal with Amazon Web Services, to be clear, but this a pretty comprehensive strategic deal. All the heavy hitters flying in from Germany. We had talked to Sam, we're talking to you. What is the reaction in Moscone in San Francisco around the SAP Google relationship news? >> Akash: I think, so the reaction is very positive and I think what this sort of shows everybody here that our friends at Google are very serious about the enterprise, and as such, they have extended a very warm hand in partnering with SAP and bringing what I call transactional and enterprise workloads onto Google Cloud, and I think that's a very significant change from what Google Cloud was doing in the past, they are supporting all kinds of workloads, but they're now really focusing on helping enterprises kind of transition into the cloud. I think SAP can act as a massive catalyst for that effort. >> It also brings a huge amount of credibility to the Google Cloud Platform, certainly in the enterprise. SAP has been a leader, powering some of the biggest business in the world with your software system of records, certainly the database is evolving. You've had cloud, you've had HANA, data analytics for many years, I can almost, I think seven years I've been to Sapphire, Bill McDermott, and back then Schnabel, was talking about analytics. This really hits home, because Google has a great mind share with the developer community, they actually have great empathy, they understand developers and open source, certainly they understand cutting edge technology. But now with SAP, this seems to be a nice lucky strike and a lightning strike, if you will, for developers to monetize with SAP, because you guys have real big paying enterprise customers that could use some cloud native. Is that how you see it? Help us understand the impact to developers and then the impact to customers. >> Akash: Yeah, I think the opportunity is multifold, as I would explain it. Customers, our customers and Google customers can take SAP workloads onto Google Cloud, and that is in the form of taking HANA and running any applications that run on top of HANA onto Google Cloud. I think that's kind of one piece of the announcement that we've made today. The second piece, and I think that's what you're alluding to is around developers, and those developers could be our developers, SAP's 2.5 million developers, it could be a multitude of developers that are attracted to Google and all the services that Google provides. But what they can do now is to leverage SAP's HANA Express product which is a developer centric product, and then run that on Google Cloud Platform, and build applications that could leverage HANA technology and build next generation of applications, either applications that are net new that can take data from any data source, or applications that want to extract data from SAP. The final thing that we also now as part of our HANA cloud platform or SAP Cloud platform is the ability to take the cloud foundry components of our SAP Cloud Platform and make them available on Google Cloud Platform and that. That, as you can see, is a very rich environment. We've extended Google's palette of services to include our SAP Platform as a service components to help fast track developers who want to build enterprise class applications that want to interchange data that's already in SAP systems or want to store stuff in our HANA database that is now going to be able to run on Google Cloud Platform. I think that's what has been announced here. It's quite a lot and I think over the coming months, developers will be able to get access to that, and if they can get access to it, on the Google Cloud Launcher platform later today they should be able to get a copy of the SAP HANA Express product. >> What is the impact to SAP? Because we spoke recently at the Amazon Web Services reinvent, Akash, obviously, you have a relationship with them as well. But this really kind of gives SAP a new set of capabilities for developers that aren't familiar with SAP. You have, certainly, a huge ecosystem of developers that are SAP centric, now a new community's developing for SAP, how do you see that unfolding for SAP and what are you guys doing specifically to onboard those developers and really give them the seamless tooling that they need so that they don't have to worry about all the engineering and the back office, database. What goodness are you bringing to those developers to make their life? >> Well, and I think first and foremost we've expanded the market, we are giving them access to great public cloud platforms in Amazon AWS, in Microsoft's Azure, and now with Google Cloud Platform. Now, a developer that wants to develop using SAP Cloud platform and SAP HANA has a choice, and they can now, depending on the expertise they have, depending on what they want to do, they can very easily leverage any of those three major cloud platforms. We're giving them choice and I think the world wants choice. We're making it easy, so that's number one. Number two, our SAP Cloud platform enablement teams are there to help cross track people. We're making it easy for developers to start working on products that are easy for developers such as the HANA Express, and they can, 32 GB worth of data that they use is free to use, and then they can go to SAP store and get a license key, and then enable that license key on any of the other public cloud providers as they expand and extend their systems. As you can see, I think we're giving them choice, we're giving them a lot of capability in terms of enablement, and then we're giving them a product which they can get started with with no friction. >> I want to ask you a question, Akash, because I know you have a lot of industry's view of the landscape. I was clarifying this morning in a blog post and also here on the Cube that you really can't compare Google Cloud to Amazon, they're two different worlds. You have apples and oranges, if you will. Why, help people understand real quickly, why, what is the Google Cloud all about? Because we really want to separate that conversation, they're not really apples to apples, it still is cloud, but there are differences. What is the key take away for users and customers about Google Cloud and what's the differentiation for them vis a vis other approaches? >> Well, that's not something that, I'm not the world expert on Google Cloud Platform, and I think that's something our friends at Google can kind of give you a very good rundown on. But, obviously, Google prides itself at, instead of services that are very data centric, they have, obviously, decades of experience in running their own services, and they're opening up some of those capabilities and making them available to their customers. We felt that we need to kind of double down on Google Cloud Platform and support that just like we're supporting the AWS platform and Azure. We believe that these are three major cloud platforms, each of them have their own uniqueness and capabilities, that these companies market and promote. I think it's best that you get someone from Google to comment on some of the differences, because I think there are quite a few, and I would be remiss at highlighting those. >> That's fair, appreciate that, and we'll try to have someone on in 5:00, we'll hopefully get someone slotted in. Final question for you, Akash. What's in it for the developers? To share your perspective on what you're excited about, that developers that don't know SAP should be excited about. What's the real opportunity for them in relevant? >> I think today a Google Cloud Platform developer has suddenly a window into the SAP world. The SAP world is big, it's very rich in usage, and those customers are large, they're interesting customers doing very complex things. I think it opens them up to grabbing the digital transformation ways that's hitting a lot of customers. I think what this can do to those developers is give them a window into a world that they perhaps didn't have before, because today, with SAP technology becoming available on Google Cloud Platform, they could suddenly target enterprise use cases that perhaps they were not doing before. These are transactional use cases. Obviously, both transactional and analytical type use cases, what we call OLAP use cases suddenly become important. I think the IoT opportunities are very interesting for developers. The industrial Internet is in full swing. Just coming back from Mobile World Congress, I think that was the theme, everything is connected. We can get you access to the customer record, we can get you access to the product, the SKU, that's all in SAP systems, and suddenly, the developer can access those systems to build next generation engagement applications as part of a digital transformation that the company may be doing. >> Yeah, I think Google could lean on you guys a little bit too, for partnering with the IoT certainly. Not a lot mentioned, maybe we'll hear more tomorrow, but I do think that, if I'm a developer, I would look at you guys as a innovation ground for using AI and using that data analytics making it very intelligent. You have the store of the data, you have the database. Congratulations to Akash, really appreciate you taking the time, on the ground in San Francisco. Akash Agarwal, GVP at SAP, friend of the Cube, a regular contributor here on our new studio programs. Thanks so much for taking the time and giving us a reaction and breaking down the news for us on the SAP Google relationship. >> Akash: Thanks, John. >> OK, more live coverage of Google Next coming right up. Be right back. (busy electronic music)