>> Announcer: From theCUBE studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is a CUBE Conversation. >> Hi everybody, this is Dave Vellante, and back in 2013, when it was becoming pretty obvious that the cloud was going to have a major impact on our industry, the IT industry, I wrote at the time that the way incumbents were going to have to compete was to really go into vertical markets and build ecosystems for their own clouds, and that's exactly what IBM did late last year, when it announced a major partnership with Bank of America in the financial services cloud, and guess what, Hillery Hunter is back in the house, she's the vice president and CTO of the IBM cloud, and an IBM fellow, Hillery, great to see you again, thanks for coming back on. >> Thanks so much for having me again, always a pleasure to be here. >> So we had an awesome conversation, I think we got into the FS cloud a little bit, but as I was saying, you guys announced last year, Bank of America, but let me start here. Why does the industry need a financial services cloud? >> Yeah, you know, it's key that we ground ourselves in that question of why a financial services cloud, and I think it really goes back to the sensitivity of the workloads and the data that that industry stewards. The financial services industry stewards the data of millions and millions of customers, and they are heavily regulated because of that, and they handle very high value transactions, and being able to take that context and translate that into what does it mean to do high value transactions, sensitive data, consumer data computing, also with all those benefits of elasticity and the value proposition of different deployment locations, is really what financial cloud is about. And those needs of that industry are a little bit different, the regulations are higher, the bar and data protection is higher, and the need to interlock across workload characteristics and the cloud deployment is a bit different. And so, we are bringing what we know about that industry to bear in the context also of cloud computing. >> Okay, so you're making some new announcements, there's some hard news here, but I want to know, if you're an executive, or business leader in the financial services industry, what's in it for me in these announcements? >> Yeah, what's in it for you is that we are moving into the next phase of financial services cloud in making the policy framework that has been developed through an enormous amount of work available to additional industry participants, and we're also moving into a phase of global expansion, and so being able to take this value proposition of an end to end considered secure and confine environment for financial services, out to more players in the industry, out to additional geographies and deployment locations, it's an exciting moment because everyone's really not looking just for a cloud, but they're looking for a choice of deployment locations, they're looking to move more workload to the cloud, and this is really about providing a cloud solution that more workload can move to, not just the first couple phases of analytics and things like that, but also moving into more transformation of the core of banking and the core of banking business, so it is about getting more workload to the cloud, getting that done faster, and getting it done at a net improved security and compliance posture. >> Got it, so I want to ask you about some learnings, now you're the double whammy of learnings here. When you announced the collaboration with B of A, obviously one of the top banks of the world, you've obviously made some progress since then, but the other part of that whammy was COVID. So what did you learn from the collaboration with B of A, and have you guys, how have you expanded your thinking BC, from before COVID, versus AC, after COVID? >> Yeah, you know, the initial motivation for this program was about having trust and transparency in public cloud, and having a public cloud suited also to sensitive and even core banking workloads. We have seen this conversation and the need for it and the urgency for it only pick up since COVID. A lot of things in the world kind of took a pause, but cloud computing really accelerated. We're seeing that businesses need to digitally transform their banking, so core banking transformation is a very hot topic. They need to deal with elasticity, we worked with banks during COVID that were having to suddenly stand up their national equivalent of the Payroll Protection Program. Banks that had to suddenly have three times the elasticity, because all of a sudden consumers were interacting with them purely digitally. And cloud can enable all of those kind of things, and so COVID has really accelerated the motivation toward banking in the cloud, and also toward core banking transformation, which is at the heart of setting a very high security bar in public cloud, to be able to also enable those kind of workloads. >> Yeah, so many changes as a result of COVID, I mean the volume of loans, like you said, everything was digital. I know a lot of older people that always still like to go into the bank, that like to see people, and they knew people and people knew them, well they had no choice but to go digital, so that's huge, if you didn't have a digital solution, and cloud is fundamental in that equation. But let's get into it a little bit more. We talked a little about this at IBM Think, but what are the key attributes that make the IBM financial services cloud suitable for financial services, is it the certifications, I wonder if you could add some color there. >> Yeah, so the key elements of the financial services cloud program are number one, a policy framework, which is a set of controls that are customized to the financial services industry, so this isn't about some existing standard, this is a customization of controls and security for the financial services industry, and that's a major element of what we're announcing right now. In addition to the policy framework is also the way that the different elements of the industry and of regulatory expertise are coming together, so this cloud, and these public cloud offerings, were co-developed and co-designed with IBM Promontory, with IBM Security Services that work with banks, with our anchor partner, and moving forward, we'll be advised by an advisory council of CSOs who have that day to day experience with security and with regulations. And so that is also a very unique context for not this being just a point in time with a policy framework, but being an ongoing initiative that will stay up to date, as security concerns and as regulatory concerns change. And the third aspect is a really unique set of technologies that make all of that possible, so you have to define how the cloud is going to be secure, and then you have to actually do it, and the unique capabilities that we have in IBM public cloud that have enabled this program include a number of things, but amongst them, the industry's highest standard for data protection, with our FIPS-140-2 Level 4 based key protect service, it includes capabilities that we'll be releasing through our acquisition of Spanugo around cloud security and compliance posture management, mapped back to that context of financial services. And so it's really three things, it's a policy framework custom and optimized for the financial services industry, the forward evolution of that through industry expertise, and participation of multi parties in that, and then core technologies that enable folks to accomplish that security posture through data protection, through cloud security posture management, et cetera. >> I forgot about the Promontory, you guys made that acquisition several years ago, that's a nice little feature of the FS cloud. But I want to ask, how hard is it to get these certifications? I mean it's obviously not a layup. Lot of work, lot of time, my reason of my question, is this a moat for you, as you guys start to scale? How difficult is it? >> Yeah, so we have been putting in the time and effort, and so that's why this is an exciting moment for us with the initial work product of this effort. And so our intention really is not for that to be a moat, but for us having traversed the moat, to now have a bridge there through the methodology that we built, through the control framework that we built, for others to now get across that moat. And so this is really about taking what is an extensive amount of work, and an extensive amount of expertise, IBM Promontory, you just mentioned, but they monitor over 70 regulatory obligations in over 20 jurisdictions globally, right? I mean this is a tremendous depth of expertise, and so having crossed the moat, and having built the bridge across it, this is where we can then help others to save time in this process of adopting public cloud for further workloads. >> You've mentioned workloads, you've talked about core financial workloads, but maybe give us a little insight on what type of workloads are the most suitable for the financial services cloud, because let's face it, most of the hardcore mission-critical workloads haven't moved, actually probably none of 'em have moved to the cloud, you kind of referenced that before. Ginni Rometty talks about that all the time. But what are the right workload strategic fits for your cloud? >> Yeah, you know you mentioned Ginni Rometty, and so I'll take a quick note there from some of the language that you'll hear her use, she talks about, there was chapter one of the cloud journey, and stuff that was on less sensitive data, analytics, some things on public information, were certainly done, also in finance and also in regulated industries in the cloud. And she talks about chapter two, chapter two being mission-critical workloads. And this program really is the definition of chapter two for the financial services industry. It is the enabling expertise, the enabling control set, the enabling security technologies, the enabling cloud services, for that chapter two, right, for that next layer of adoption of things that had been kept behind the firewall, had been kept in a private cloud context, can now be considered also for public cloud. And so easing that adoption, streamlining that process, et cetera, is really what we're looking to accomplish. >> I mean obviously IBM, huge presence in the banking community, is this really for just big banks? What about the ecosystem, what do you got in there for ISVs and SaaS providers? >> Yeah, you know, you asked me a question at the beginning here about COVID and what's happened, and I think, the transformation of ISV providers to become SaaS providers, the expansion of their capabilities being needed in payments and digital client experiences and such, also for regionals and second and third tier banking institutions and such, is as much of what is happening right now as anything else, amongst the first tiers, because there's just as much pressure for transformation and digital consumer experience, and other things like that, also in the regionals and second and third tiers. So part of our announcement is around the ecosystem of partners that we have now for the financial services cloud program. And that includes ISVs and SaaS providers that are servicing many different types of needs of institutions large and small, so we're seeing those that are servicing core banking, and payments, those that are servicing analytics use cases for this industry, and even HR function, just because of that concern about stewarding data well for these industries and those first tier banks, and so that transition to digital, that drive to infuse AI capabilities, the need to transform core banking, is something that's very much also happening within the ISV and SaaS providers, and we're thrilled with the wide variety of partner base that we're seeing develop there within our ecosystem for this program. >> I was talking to a CIO friend of mine several years ago, and he said to me, "You know, this idea of lifting and shifting, "it's fine, you get little cost savings, maybe, "but unless you change your operating model "and you drive an innovation agenda, "you really aren't going to get the type "of telephone number returns from cloud "that you would want or expect." So my question is around innovation, and we've said many times in theCUBE that the new innovation cocktail, it's not Moore's law anymore, it's the combination of data applying machine intelligence and then the cloud, and the reason why the cloud is important is scale, okay, there's maybe a little bit of cost as well, but it's also innovation. It's the ability to attract people into an ecosystem, and that resonates with line of business. If your cloud is just about making IT's life better, well that's nice, but what's in this announcement and in this initiative for the line of business? >> Yeah, it is all about the workloads. I always say that to me the cloud journey is about, number one your platform, which is the thing onto which you modernize. It is what are you going to get out of moving to containers, what are you going to get out of moving to microservices, how does that help all of those cloud metrics that you mentioned? But number two, it's about the workload, right, which workloads are we talking about, how will they deliver, how will those workloads be able to because of cloud deliver not just TCO but improvement in customer experience, how will those workloads be able to meet elasticity, resiliency, cybersecurity concerns, changes in the way the workforce is working these days, et cetera. And from the line of business perspective, there is a tremendous need to consume, for example, fintech-based innovation. But a lot of folks have struggled to move past POCs because of concerns about security and compliance, for those deployment scenarios, and so being able to bring the ISVs and SaaS providers, and then also fintechs into an ecosystem with a prescriptive and proactive security and compliance context is really what we're all about here. And that will enable a flourishing of adoption of innovation. >> You know, I always love to talk about the competition on these episodes. But I want to ask differentiation, how different is this, can I just go to any cloud supplier and get this, will I eventually be able to, what's IBM's differentiation, Hillery? >> Yeah, so you want to think of it that, in financial services, you are concerned, and you have to be concerned about everything. You have to be concerned about things into the details of the cloud itself, you have to be concerned about things that are related to the behavior and the permissions of your developers in that environment. Financial services cloud really has to be an end to end, soup to nuts conversation, and so this is a program of our public cloud, where end to end, we can stand behind and provide trust and resiliency and this policy framework, end to end within an environment that can be trusted for mission-critical workload. And so when we look at differentiation, our investments are in bringing together IBM's expertise all the way going back to regulations and security consulting that we've been doing for decades in this industry, applying that to that cloud context, taking capabilities that are developed all the way down into the transistors, investments we've made even into the silicon around how cryptography is done, bringing that into the cloud context. And so having brought those things together into our public cloud context, that's how we're able to solution this in a different way, because it really is end to end about the expertise, from all of that regulatory advising, that security context, all the way down into the silicon and the transistors, and I think that's a very unique value proposition, as a cloud provider, it's a tremendous opportunity for us to bring together those pieces. And to continue to be a trusted partner to these companies that we have long been a trusted partner of. >> Now of course you guys have a relationship with VMware, you were the first, actually, to announce a VMware cloud relationship. And so let's say, okay, I got some VMware workloads, I move 'em into your FS cloud. Make sure that I've got the security and compliance checked. Six months down the road, so I've done that sort of first step, what's next for me, is that the end, or are there other things on my journey? >> Yeah, so absolutely, I mean VMware is part of what we are solution financial services clients to, but also cloud-native, and OpenShift, containerization, that modernization journey, is an ongoing journey for everyone, and so to your point of what's next, we're seeing a continual conversation of balancing lift and shift and modernization across workloads, and there are different reasons at different points in time, for people to consider that. I think the key is that they trust where they are taking that data, and whatever the form is that the workload goes, it needs to be in the context of that trust around the data in a security context, and so we're absolutely seeing everything, honestly, from financial services institutions looking to engage with us, also in our new research innovation lab, where we're engaging directly with financial services clients that are trying to work through this differentiation, is it virtualization, is it containerization, is it even serverless? What is the right and most effective balance of how workloads are programmed and run for the next generation of banking. >> You know, Hillery, I've been doing a lot of interviews in the last decade, and it's been interesting to see the ascendancy of cloud, of course, but also the change in perception, particularly in financial services, in the early days of cloud, cloud was an evil word. The C that should not be named. And so I want to understand if I'm, and of course COVID has also changed the perception, because if you weren't digital and you didn't have cloud, you couldn't really transact businesses as well, you didn't have that business resiliency. So, what if I'm a financial services person now, okay, I'm through the knothole, I want to get started, where do I start? >> Yeah, well call us first, but past that, I think that the conversations, the first conversations that we're having with our clients are, number one, do you have an architecture? So is cloud not just a place, like I like to say, but is cloud a plan, is there an architectural plan to enable you to have consistency, for example, in your developer experience between your private cloud environment and your public cloud environment? Architecturally are there those foundational choices around common services about being able to deploy capabilities in one location, and develop them in another, et cetera. All those value propositions of what we have been creating around OpenShift and Cloud Paks in our public cloud, and consistency across different environments and such, I think that's the first thing to start with is architecting a cloud, not accidental usage of multiple environments, but architecting use of multiple environments. And then I think the second conversation is to make a security and compliance plan that is going to be robust enough to withstand even the intense scrutiny of a regulated industry CCO and risk team, and so that's the other foundational conversation that we're having with our clients, and helping them with, so we can provide services and reference architectures, and all that other kind of thing, to enable them to stabilize planning on both fronts, both architecturally for what cloud means in its entirety, not just a cloud, but in its entirety, all clouds, multicloud, hybrid cloud, et cetera. And then secondly, then, a comprehensive security plan for that public cloud choice, and that's what we're really locking down with this policy framework, is bringing standardization on that for public cloud. >> Well, lot of innovation for the financial services community, which is again your wheelhouse. I wrote a piece right around Think that IBM's future rests on its innovation agenda, and I'm glad you brought up the notion of private, public, and then the whole hybrid thing, because I see OpenShift as a key, and RedHat as a key enabler of that across whether it's cloud, on-prem, edge, across multiple clouds. That's an ambitious agenda, as somebody who's responsible for cloud. That is something that is real innovation, and really differentiable I think, in the marketplace, and probably pretty expensive to build out across all those different platforms. >> Yeah, it is, but I think on the word innovation, my mind, as an IBMer, goes to the IBM research division. Thousands of researchers globally, and they've very much been a part of this journey with us. The journey with us on containerization, the journey on workload modernization from monolith to microservices, the journey of our public cloud, and now also very much a part of our work in financial services, so our research division is this incredible gift and asset that we have, that is working with us also on our cloud security and compliance posture management, that security and compliance control center that we're talking about in this announcement, et cetera, and so them being a part of this innovation stream for us is a really exciting part, again, of bringing together all these different pieces that IBM has to offer in this space to make it all stack up, to be a cloud for financial services. >> I got a couple of little housekeeping items before we close here. This is announced for the US first, right? What about other regions, first of all, is that correct, and what about other regions? >> That's correct, and we are also announcing additional participation of global banking partners as well in this announcement. And so this is also again our initial public statement of our expansion past the US. >> Last question, so just give us a glimpse of the future, where do you want to be in a few years, thinking about let's say three years down the road, what's that outcome look like? >> Yeah, you know I think that three years from now, we would love to see that people are able to make a decision, going back to your question about the line of business owners, make a decision about what they're trying to accomplish with a workload, and not be held back by security and compliance concerns in terms of putting that workload where it needs to be, where it will be most efficient, and where it can be embraced by a set of cloud capabilities that enable it to move in a competitive pace forward, infusing AI into everything that is done. Leveraging the latest in technologies, and serverless computing and all these other kind of things that can facilitate a line of business delivering more value so that cloud really continues, but also realizes its promises in that chapter two version of the story, also for regulated industries and also for their mission-critical workloads. >> Well Hillery, good luck with this, I mean congratulations on the progress that you've made, really since you guys announced this late last year, and really excited to see this start to take off, and you're a great guest, love having you on, thank you so much. >> Thanks so much for having me, pleasure talking to you as always. >> All right, cheers. And thank you everybody for watching, this is Dave Vellante for theCUBE, and we'll see you next time. (calm music)

(soft music) >> Welcome back to Sin City, guys and girls we're glad you're with us. You've been watching theCUBE all week, we know that. This is theCUBE's live coverage of AWS re:Invent 22, from the Venetian Expo Center where there are tens of thousands of people, and this event if you know it, covers the entire strip. There are over 55,000 people here, hundreds of thousands online. Dave, this has been a fantastic show. It is clear everyone's back. We're hearing phenomenal stories from AWS and it's ecosystem. We got a great customer story coming up next, featured on the main stage. >> Yeah, I mean, you know, post pandemic, you start to think about, okay, how are things changing? And one of the things that we heard from Adam Selipsky, was, we're going beyond digital transformation into business transformation. Okay. That can mean a lot of things to a lot of people. I have a sense of what it means. And I think this next interview really talks to business transformation beyond digital transformation, beyond the IT. >> Excellent. We've got two guests. One of them is an alumni, Scott Mullins joins us, GM, AWS Worldwide Financial Services, and Brad Peterson is here, the EVP, CIO and CTO of NASDAQ. Welcome guys. Great to have you. >> Hey guys. >> Hey guys. Thanks for having us. >> Yeah >> Brad, talk a little bit, there was an announcement with NASDAQ and AWS last year, a year ago, about how they're partnering to transform capital markets. It was a highlight of last year. Remind us what you talked about and what's gone on since then. >> Yeah, so, we are very excited. I work with Adena Friedman, she's my boss, CEO of NASDAQ, and she was on stage with Adam for his first Keynote as CEO of AWS. And we made the commitment that we were going to move our markets to the Cloud. And we've been a long time customer of AWS and everyone said, you know the last piece, the last frontier to be moved was the actual matching where all the messages, the quotes get matched together to become confirmed orders. So that was what we committed to less than a year ago. And we said we were going to move one of our options markets. In the US, we have six of them. And options markets are the most challenging, they're the most high volume and high performance. So we said, let's start with something really challenging and prove we can do it together with AWS. So we committed to that. >> And? Results so far? >> So, I can sit here and say that November 7th so we are live, we're in production and the MRX Exchange is called Mercury, so we shorten it for MRX, we like acronyms in technology. And so, we started with a phased launch of symbols, so you kind of allow yourself to make sure you have all the functionality working then you add some volume on it, and we are going to complete the conversion on Monday. So we are all good so far. And I have some results I can share, but maybe Scott, if you want to talk about why we did that together. >> Yeah. >> And what we've done together over many years. >> Right. You know, Brian, I think it's a natural extension of our relationship, right? You know, you look at the 12 year relationship that AWS and NASDAQ have had together, it's just the next step, in the way that we're going to help the industry transform itself. And so not just NASDAQ's business transformation for itself, but really a blueprint and a template for the entire capital markets industry. And so many times people will ask me, who's using Cloud well? Who's doing well in the Cloud? And NASDAQ is an easy example to point to, of somebody who's truly taking advantage of these capabilities because the Cloud isn't a place, it's a set of capabilities. And so, this is a shining example of how to use these capabilities to actually deliver real business benefit, not just to to your organization, but I think the really exciting part is the market technology piece of how you're serving other exchanges. >> So last year before re:Invent, we said, and it's obvious within the tech ecosystem, that technology companies are building on top of the Cloud. We said, the big trend that we see in the 2020s is that, you know, consumers of IT, historically, your customers are going to start taking their stacks, their software, their data, their services and sassifying, putting it on the Cloud and delivering new services to customers. So when we saw Adena on stage last year, we called it by the way, we called it Super Cloud. >> Yeah. >> Okay. Some people liked the term but I love it. And so yeah, Super Cloud. So when we saw Adena on stage, we said that's a great example. We've seen Capital One doing some similar things, we've had some conversations with US West, it's happening, right? So talk about how you actually do that. I mean, because you've got a lot, you've got a big on-premises stay, are you connecting to that? Is it all in the Cloud? Paint a picture of what the architecture looks like? >> Yeah. And there's, so you started with the business transformation, so I like that. >> Yeah. >> And the Super Cloud designation, what we are is, we own and operate exchanges in the United States and in Europe and in Canada. So we have our own markets that we're looking at modernizing. So we look at this, as a modernization of the capital market infrastructure, but we happen to be the leading technology provider for other markets around the world. So you either build your own or you source from us. And we're by far the leading provider. So a lot of our customers said, how about if you go first? It's kind of like Mikey, you know, give it to Mikey, let him try it. >> See if Mikey likes it. >> Yeah. >> Penguin off the iceberg thing. >> Yeah. And so what we did is we said, to make this easy for our customers, so you want to ask your customers, you want to figure out how you can do it so that you don't disrupt their business. So we took the Edge Compute that was announced a few years ago, Amazon Outposts, and we were one of their early customers. So we started immediately to innovate with, jointly innovate with Amazon. And we said, this looks interesting for us. So we extended the region into our Carteret data center in Northern New Jersey, which gave us all the services that we know and love from Amazon. So our technical operations team has the same tools and services but then, we're able to connect because in the markets what we're doing is we need to connect fairly. So we need to ensure that you still have that fairness element. So by bringing it into our building and extending the Edge Compute platform, the AWS Outpost into Carteret, that allowed us to also talk very succinctly with our regulators. It's a familiar territory, it's all buttoned up. And that simplified the conversion conversation with the regulators. It simplified it with our customers. And then it was up to us to then deliver time and performance >> Because you had alternatives. You could have taken a more mature kind of on-prem legacy stack, figured out how to bolt that in, you know, less cloudy. So why did you choose Outposts? I am curious. >> Well, Outposts looked like when it was announced, that it was really about extending territory, so we had our customers in mind, our global customers, and they don't always have an AWS region in country. So a lot of you think about a regulator, they're going to say, well where is this region located? So finally we saw this ability to grow the Cloud geographically. And of course we're in Sweden, so we we work with the AWS region in Stockholm, but not every country has a region yet. >> And we're working as fast as we can. - Yes, you are. >> Building in every single location around the planet. >> You're doing a good job. >> So, we saw it as an investment that Amazon had to grow the geographic footprint and we have customers in many smaller countries that don't have a region today. So maybe talk a little bit about what you guys had in mind and it's a multi-industry trend that the Edge Compute has four or five industries that you can say, this really makes a lot of sense to extend the Cloud. >> And David, you said it earlier, there's a trend of ecosystems that are coming onto the Cloud. This is our opportunity to bring the Cloud to an ecosystem, to an existing ecosystem. And if you think about NASDAQ's data center in Carteret, there's an ecosystem of NASDAQ's clients there that are there to be with NASDAQ. And so, it was actually much easier for us as we worked together over a really a four year period, thinking about this and how to make this technological transition, to actually bring the capabilities to that ecosystem, rather than trying to bring the ecosystem to AWS in one of our public regions. And so, that's been our philosophy with Outpost all along. It's actually extending our capabilities that our customers know and love into any environment that they need to be able to use that in. And so to Brad's point about servicing other markets in different countries around the world, it actually gives us that ability to do that very quickly, very nimbly and very succinctly and successfully. >> Did you guys write a working backwards document for this initiative? >> We did. >> Yeah, we actually did. So to be, this is one of the fully exercised. We have a couple of... So by the way, Scott used to work at NASDAQ and we have a number of people who have gone from NASDAQ data to AWS, and from AWS to NASDAQ. So we have adopted, that's one of the things that we think is an effective way to really clarify what you're trying to accomplish with a project. So I know you're a little bit kidding on that, but we did. >> No, I was close. Because I want to go to the like, where are we in the milestone? And take us through kind of what we can expect going forward now that we've worked backwards. >> Yep, we did. >> We did. And look, I think from a milestone perspective, as you heard Brad say, we're very excited that we've stood up MRX in production. Having worked at NASDAQ myself, when you make a change and when you stand up a market that's always a moment where you're working with your community, with your clients and you've got a market-wide call that you're working and you're wanting to make sure that everything goes smoothly. And so, when that call went smoothly and that transition went smoothly I know you were very happy, and in AWS, we were also very happy as well that we hit that milestone within the timeframe that Adena set. And that was very important I know to you. >> Yeah. >> And for us as well. >> Yeah. And our commitment, so the time base of this one was by the end of 2022. So November 7th, checked. We got that one done. >> That's awesome. >> The other one is we said, we wanted the performance to be as good or better than our current platform that we have. And we were putting a new version of our derivative or options software onto this platform. We had confidence because we already rolled it to one market in the US then we rolled it earlier this year and that was last year. And we rolled it to our nordic derivatives market. And we saw really good customer feedback. So we had confidence in our software was going to run. Now we had to marry that up with the Outpost platform and we said we really want to achieve as good or better performance and we achieved better performance, so that's noticeable by our customers. And that one was the biggest question. I think our customers understand when we set a date, we test them with them. We have our national test facility that they can test in. But really the big question was how is it going to perform? And that was, I think one of the biggest proof points that we're really proud about, jointly together. And it took both, it took both of us to really innovate and get the platform right, and we did a number of iterations. We're never done. >> Right. >> But we have a final result that says it is better. >> Well, congratulations. - Thank you. >> It sounds like you guys have done a tremendous job. What can we expect in 2023? From NASDAQ and AWS? Any little nuggets you can share? >> Well, we just came from the partner, the partner Keynote with Adam and Ruba and we had another colleague on stage, so Nick Ciubotariu, so he is actually someone who brought digital assets and cryptocurrencies onto the Venmo, PayPal platform. He joined NASDAQ about a year ago and we announced that in our marketplace, the Amazon marketplace, we are going to offer digital custody, digital assets custody solution. So that is certainly going to be something we're excited about in 2023. >> I know we got to go, but I love this story because it fits so great at the Super cloud but we've learned so much from Amazon over the years. Two pieces of teams, we talked about working backwards, customer obsession, but this is a story of NASDAQ pointing its internal capabilities externally. We're already on that journey and then, bringing that to the Cloud. Very powerful story. I wonder what's next in this, because we learn a lot and we, it's like the NFL, we copy it. I think about product market fit. You think about scientific, you know, go to market and seeing that applied to the financial services industry and obviously other industries, it's really exciting to see. So congratulations. >> No, thank you. And look, I think it's an example of Invent and Simplify, that's another Amazon principle. And this is, I think a great example of inventing on behalf of an industry and then continually working to simplify the way that the industry works with all of us. >> Last question and we've got only 30 seconds left. Brad, I'm going to direct it to you. If you had the opportunity to take over the NASDAQ sign in Times Square and say a phrase that summarizes what NASDAQ and AWS are doing together, what would it say? >> Oh, and I think I'm going to put that up on Monday. So we're going to close the market together and it's going to say, "Modernizing the capital market's infrastructure together." >> Very cool. >> Excellent. Drop the mic. Guys, this was fantastic. Thank you so much for joining us. We appreciate you joining us on the show, sharing your insights and what NASDAQ and AWS are doing. We're going to have to keep watching this. You're going to have to come back next year. >> All right. >> For our guests and for Dave Vellante, I'm Lisa Martin. You're watching theCUBE, the leader in live enterprise and emerging tech coverage. (soft music)

(upbeat music) >> Hello, and welcome to this Cube conversation. I'm Dave Nicholson, and this is part of our continuing coverage of Google Cloud Next 2021. We have a very interesting subject to discuss. I have two special guests from Google to join me in a conversation about the financial services space. I'm joined by Yolande Piazza, vice president of financial services sales for Google Cloud and Zac Mauf, managing director for global financial services solutions for Google Cloud. Yolande and Zac, welcome to the Cube. >> Thank you for having us. Looking forward to it. >> Well it's great to have you here. You know, financial services is really an interesting area when you talk about cloud because I'm sure you both remember a time, not that long ago, when we could ask a financial services organization, what their plans for cloud or what their cloud strategy was, and they would give a one word answer and that answer was, never. (laughing) So Zac, let's start out with you, what has changed? Are you and Yolande going to tell us that in fact, financial services organizations are leveraging cloud now? >> Yeah, it's a very exciting time to be in the cloud space, in financial services, because you're exactly right David. People are starting to make the transition to cloud in a real way. And a lot has gone into that, as you know, it's a highly regulated space and so there were a lot of legitimate reasons around getting kind of the regulatory frameworks in place and making sure that the risk and compliance pieces were addressed. But then there was also, as you know, technology is a major backbone for financial services. And so there's also this question of, how do we transition? And a lot of work and time has gone into moving workloads, thinking about like, what is the sort of the right migration strategy for you to get from the current situation to a more cloud native world. And to your point, we're really early, we're really early, but we're very excited and we've been investing heavily on our side to get those foundational pieces in place. But we also realized that we have to think about what are the business cases, that we want to build on top of cloud. It's not just a kind of IT modernization, which is a big part of the story, but the other part of the story is once you get all of this, technology onto the cloud platform, there are things that you can do that you couldn't do in on-prem situations. And a lot of that for us is around the data, AI and ML space. And we really see that being the way to really unlock huge amounts of value. Both of them require massive amounts of compute and breaking down all of these silos that have really developed over time within financial institutions. And really moving to the cloud is the way to unlock a lot of that. So we're really excited about a lot of those use cases that are starting to come to life now. >> Yeah. So I want to dig a little deeper on some of that Zac, but before we do, Yolande make this real for us. Give me some examples of actual real-life financial services organizations and what they're doing with Google Cloud now. >> Yeah, absolutely. And I think we're really proud to be able to announce, a number of new partnerships across the industry. You think about Wells Fargo, you think about Scotia Bank, you think about what we're doing with HSBC. They really are starting to bring to life and recognized that it's not just internally, you have to look at that transformation to cloud, it's really, how do you use this platform to help you go on the journey with your customers? I think a move to a multi-cloud common approach for our customers and our clients, is exactly what we need to be focused on. And the other- >> Hold on, hold on, Yolande. I'm sorry. Did the Google person just say multi-cloud? Because multi- cloud doesn't sound like, only Google Cloud to me. Can you- >> No, and I think Wells, absolutely, and I think Wells announced it's taking a multi-cloud approach to its digital infrastructure strategy, leveraging both Google Cloud and Microsoft Azure. And the reason being is they've openly communicated that a locked in and preparatory systems, isn't the way to go for them. They want that open flexibility. They want the ability to be able to move workloads across the different industries. And I think it's well known that this aligns completely with our principles and at Google we've always said that we support open multi and hybrid cloud strategies because we believe our customers should be able to run what they want, where they want it. And that was exactly the philosophy that that Wells took. So, and if you look at what they were trying to do is they're looking to be able to serve their customers in a different way. I think that it's true now that customers are looking for personalized services, instant gratification, the ability to interact, where they want and when they want. So we're walking with the Wells teams to really bring to life through AI, our complex AI and data solutions to really enable them to move at speed and serve their customers in a rapidly changing world. >> So Yolande, part of the move to cloud includes the fact that we're all human beings and perception can become reality. Issues like security, which are always at the forefront of someone's mind in financial services space, there is the perception, and then there is the reality. Walk us through today where perception is in the financial services space. And then Zac, I'm going to go back to you to tell us what's the reality. And is there a disconnect? Because often technology in this space has been ahead of people's comfort level for rational reasons. So Yolande, can you talk about from a perception perspective where people are. >> So I have to tell you, we are having conversations with both the incumbents and traditional organizations, as well as, the uprising, the fintechs, and the neobanks around how does technology really unlock and unleash a new business model. So we're talking about things like how does technology and help them grow that organization. How does it take out costs in that organization? How do you use all cloud platform to think about managing risks, whether that's operational, whether it's reputational, industry or regulatory type risk? And then how do we enable our partners and our customers to be able to move at speed? So all of those conversations are now on the table. And I think a big shift from when Zac and I both were sitting on the other side of the table in those financial services industries is a recognition that this couldn't and shouldn't be done alone, that it's going to require a partnership, it's going to require, really shifting to put technology at the forefront. And I think when you talk about perception, I would say a couple of years ago, I think it was more of a perception that they were really technology companies. And I think now we're really starting to see the shifts that these are technology companies serving their customers in a banking environment. >> So Zac, can you give us some- Yeah. Yeah. Zac, can you give us some examples of how that plays out from a solutions perspective? What are some of the things that you and Yolande are having conversations with these folks in? >> Yeah. - I mean, absolutely. I think there's three major trends that we're seeing, where I think we can bring the power of sort of the Google ecosystem to really change business models and change how things are done. The first is really this massive change that's been happening for like over 10 years now, but it's really this change in customers, expecting financial institutions to meet them where they are. And that started with information being delivered to them through mobile devices and online banking. And then it went to payments, and now it's going into lending and it's going into insurance. But it changes the way that financial services companies need to operate because now they need to figure out how to deliver everything digitally, embedded into the experience that their customers are having in all of these digital ecosystems. So there's lot that we're doing in that space. The second is really around modernizing the technology environment. There is still a massive amount of paper in these organizations. Most of it has been transferred to digital paper, but the workflows and the processes that are still needing to be streamlined. And there's a lot that we can do with our AI model and technology to be able to basically take unstructured data and create structured data. Thank Google Photos, you can now search for your photo library and find, pictures of you on bridges. The same thing we can now do with documents and routine interactions with chat bot. People are expecting 24/7 service. And a lot of people want to be able to interact through chat versus through voice. And the final part of this that we're seeing a lot of use cases in is in the kind of risk and regulatory space. Coming out of the financial crisis, there was this need to massively upgrade everybody's data capabilities and control and risk environments, because so much it was very manual, and a lot of the data to do a lot of the risk and control work was kind of glued together. So everybody went off and built data lakes and figured out that that was actually a really difficult challenge and they quickly became data swamps. And so really how do you unlock the value of those things? Those three use cases, and there's lots of things underneath those, are areas that we're working with customers on. And it's, like you said, it's really exciting because the perception has changed. The perception has changed that now cloud is the sort of future, and everybody is kind of now realized they have to figure out how to engage. And I think a lot of the partnership things that Yolande was talking about is absolutely true. They're looking for a strategic relationship versus a vendor relationship, and those are really exciting changes for us. >> So I just imagined a scenario where a Dave, Zac, and Yolande are at the cloud pub talking after hours over a few pints, and Dave says, "Wow, you know, 75%, 80% of IT is still on-premises." And Yolande looks at me and says, "On-premises? We're dealing with on-paper still." Such as the life of a financial services expert in this space. So Yolande, what would you consider sort of the final frontier or at least the next frontier in cloud meets financial services? What are the challenges that we have yet to overcome? I just mentioned, the large amount of stuff that's still on premises, the friction associated with legacy applications and infrastructure. That's one whole thing. But is there one thing that in a calendar year, 2022, if you guys could solve this for the financial services industry, what would it be? And if I'm putting you on the spot, so be it. >> No, no. I'm not going to hold it to just one thing. I think the shift, I think the shift to personalization and how does the power of, you know, AI and machine learning really start to change and get into way more predictive technologies. As I mentioned, customers want to be a segmentation of one. They don't want to be forced fit into the traditional banking ecosystems. There's a reason that customers have on average 14 different financial services apps on their phones. Yep. Less than three to 5% of their screen time is actually spent on them. It's because something is missing in that environment. There's a reason that you could go to any social media site and in no time at all, be able to pull up over 200 different communities of people trying to find out financial services information in layman's terms that is relevant to them. So the ability and where we're really doubling down is on this personalization. Being way more predictive, understanding where a customer is on their journey and being able to meet them at that point, whether that's the bright offers, whether that's recognizing, to Zac's point, that they've come in on one channel but they now want to switch to another channel. And how do they not have to start again every time? So these are some of the basics things, so we really doubled down on how do we start to solve in those areas. I think also the shift, I think in many cases, especially in the risk space, it's been very much what I would call, a people process technology approach, start to imagine what happens if you turn that around and think about how technology can help you be more predictive internally in your business and create better outcomes. So I think there's so many areas of opportunities, and what's really exciting is we're not restricted, we're having conversations that are titled, the art of the possible, or the future of, or help us come in and reinvent. So I think you're going to see a lot of shift probably in the next 12 to 18 months, I would say, and the capabilities and the ability to service the customer differently and meet them on their journey. >> Well, it sounds like the life of a cloud financial services person is much more pleasurable than back when it consisted of primarily running into brick walls constantly. This conversation five or 10 years ago would have been more like, please trust us, please. Just give us a shot. >> I think Zac and I both reminisce that we couldn't have joined at a more exciting time. It's the locker or whatever you want to call it, but it is a completely different world and the conversations are fun and refreshing, and you can really start to see how we have the ability to partner to change the landscape, across all of the different financial services industries. And I think that's what keeps Zac and I going every day. >> And you said earlier that you alluded to the idea that you used to be on the other side of the table, in other words, in the financial services industry on the customer side. So you pick the right time to come across. >> Without a doubt, without a doubt. Yes. >> Well, with that, I want to thank both of you for joining me today. This is really fascinating. Financial services is something that touches all of us individually in our daily lives. It's something that everyone can relate to at some level. And it also represents, that tip of the spear, the cutting edge of cloud. So very interesting. Thank you both again, pleasure to meet you both. Next time, hopefully it will be in-person and we can compare our steps that we've taken during the conference. With that I'll sign off. This has been a fantastic Cube conversation, part of our continuing coverage of Google Cloud Next 2021. I'm Dave Nicholson, Thanks again for joining us. >> Thank you. (upbeat music)

>> From around the globe, it's The Cube, presenting Cube on Cloud, brought to you by SiliconANGLE. >> Welcome back to Cube on Cloud. I'm Paul Gillin, enterprise editor of SiliconANGLE. As we look ahead at what is in store for the cloud this year, one of the intriguing possibilities that has emerged is the rise of vertical clouds. IBM has been a leader in this area with its launch in late '19 of the IBM Financial Services cloud. That's a services-ready public cloud with exceptional security, as well as a policy framework for certifying compliance and services from the IBM subsidiary, Promontory. Now, with the IBM Financial Services cloud, that has been a major focus of our next guest, Hillery Hunter. She is the Vice President and CTO of IBM Cloud, an IBM Fellow, and a veteran of, I believe, three previous appearances on The Cube. Am I right, Hillery? >> Yep, sounds about right. Great to be back here today. >> Thanks for joining us. So let's start with getting an update on the IBM Financial Services cloud. What progress have you made in signing up customers and your ecosystem of partners? >> Yeah, we've made really significant progress advancing the IBM Cloud for Financial Services since we last talked, and we're really at that place of establishing a trusted platform for the industry. Just in some specifics, in addition to Bank of America which we had talked about as our U.S. anchor partner for the program, we've announced several global banks that are partnering with us for the global expansion of the program, including BNP party bar, which is one of Europe's largest banks. More than 70 ASVs are signed up with us now as part of the program and adopting IBM Cloud for Financial Services. This level of ecosystem is exciting because it means that banks will have the opportunity to transform what they're doing, but do so in a way which is driven by security and compliance so that they can be confident in those deployments on IBM Cloud for Financial Services. We also released the IBM Cloud policy framework for Financial Services. This is both the security and compliance posture of the environment, as well as guidance on controls, reference architectures, automation to help people onboard. And so both ISVs and banks now are able to onboard to this environment, and offer their wares and deploy their workloads. So it's a really exciting state for us on the program, and we're really in a place where there'll be an ongoing cadence of additional releases and announcements of additional partnerships and clients. So it's an exciting time in the program. >> One of the distinctive features, I think, of this launch is that you're working actively with your customers. They're working with you on building policy frameworks, as well as, I imagine, the features that you're offering on the cloud. How do you orchestrate all of these different customers and get them involved in, actually, co-development. >> Yeah, the ecosystem conversation and the partnership conversation are two of the fundamental aspects of the program. Like you said, this isn't just us sitting off in a bubble and inventing the future. We're working internally with partners within IBM, like IBM Promontory, which is a consultancy that has deep, deep regulatory expertise in jurisdictions globally, with IBM Security Services, and then with these individual partners and banks and clients. One of the ways that we bring everything together is through our council. So our council, our Cloud Council for Financial Services, is where we have global, systemically important financial institutions partnered with us and working together with one another, and that covers CIOs, it covers chief security officers, risk officers, et cetera. So we have some formality around how we work with all of these partners, really, as a body and as a group. >> And what have you learned from this experience? If you were to go into other vertical clouds, what have been the lessons? >> Ecosystem is so important. As I look at this space, I see that everyone has an existing business. They have a platform they're running, they have clients they're trying to service, but the software providers into this space are looking, themselves, to transform. They're looking to transform from being software vendors to being SaaS providers. The banks and financial institutions themselves are looking to transform from working on their own premises to benefit from the elasticity and the scale and the optionality that being in public cloud provides. So there's a lot of parties themselves that are trying to transform, and a lot of vendors into the financial space that are looking to transform. And in that time of a lot of change, ecosystem is absolutely key. And so the ISE and SaaS providers providing their wares on the cloud for financial services is really just as important as those financial services institutions, so that everyone can make that transition together, and so that banks that are looking to digitally transform can leverage partners that are really at the forefront of that change and that innovation in platforms for the industry. >> Would you say that there are- Is this the first of many? Are there going to be other vertical IBM clouds, or is the range of industries that really need that kind of specificity, limited? I think it's actually not limited, though I will say that within the space of industries that are heavily regulated, there's obviously a deeper need for specific cloud embodiments and cloud implementation, so regulated industries like insurance, like telco, health care, et cetera, these are the ones, I think, where there's the greatest opportunity to do verticals that are specific to industry. But as we look at this, this is absolutely part of an IBM Cloud strategy to deliver industry-specific clouds. And this comes from our decades of expertise. Even in financial services, being able to leverage those other entities within IBM that I mentioned, our regulatory background with companies, having helped them address regulatory needs for specific industries, and then translating that into cloud and cloud technologies. And then coming up from the other side, in terms of the technologies themselves, we've partnered with key industries to deliver security, and data protection, and cryptography technologies, and such, on premises, and we're contextualizing that now for cloud and public cloud deployments. And so it brings together the pieces of decades of expertise in platforms, and technology, and regulations, and contextualizes it into cloud, and I absolutely think that's an opportunity for other industries as well. >> Can you give us a bit of a preview? Do you have specific industries in mind? Is there a timeframe? >> Yeah, so late last year we did announce a second industry-specific cloud initiative, and that was IBM Cloud for Telco. So we have in that ecosystem, now, over 40 partners that are now, that are working with IBM and with Red Hat, especially with clients and partners that are looking to help with that transition into 5G and increasing use of IOT. 5G is really this disruptive opportunity for that industry, and also just for many other different types of companies and institutions that are looking to deploy with more efficiency, better operational efficiency, deploy with AI capabilities, really being able to do things at cellular network EDGE, and the places that they're doing business using IOT devices, and 5G will enable much of that to really transform and flourish. So a couple of the partners, initially, in addition to that ecosystem that I mentioned in Cloud for Telco, we've got Samsung working with us, Nokia, AT&T, et cetera, and so these partnerships and capabilities around network EDGE and specific capabilities in Cloud for Telco are that second public announcement that we've made around industry-specific cloud. >> And as far as your competitive position is concerned, are you taking away business from your competitors when you partner with these telcos and these banks, or is this an entirely new line of business that was not previously in the cloud? >> Yeah, these are really, I think, in, by and large, new opportunities. As we look at, for example, how we, as customers, expect to engage with our bank, we are looking to increasingly engage with a bank in a digital way, use our applications, use mobile devices. We're looking for individual bank outlets, branch outlets of a banking institution, to be increasingly smart, to service our needs more quickly, et cetera. And so as we look at 5G and telco EDGE, it's about delivery of smarter capabilities and such. I think much of it really is about, in this digital transformation space, about creating new capabilities, creating new experiences, creating new ways of engagement, and engagement and opportunity to customize and personalize, I think most of those are new experiences and new capabilities for most companies. >> So speak about IBM's positioning right now. You're not one of the big three cloud providers, unlikely to become one, but you do have a big cloud business, and you've got the verticals, you've got the multicloud. I know IBM has been a big champion of multicloud. How is IBM distinctively positioned in the cloud market right now? >> Yeah, we are all-in on hybrid cloud and AI, and if you listen to our CEO and chairman, you'll hear that. It is a really consistent message since he came into his role as as our CEO. So being all-in on hybrid cloud and AI, we really are looking to help our clients transform into holistic cloud architecture. So when I say all-in on hybrid cloud, I mean that there's been a lot of, I jokingly say, random acts of cloud usage. People have ended up using cloud because there's some SaaS function that they want, or some particular line of business has been highly motivated to pursue some service on a particular cloud. And hybrid cloud is really about taking a step back, having a holistic architecture for cloud consumption. And in that sense, clouds are IBM's partners. And we're really looking to enable our clients to have consistency in their deployments, to consolidate across their IT estate and across their cloud deployments so that they can have a common platform, so they can have efficiency in how their developers deploy capabilities, so they can deploy more quickly with security and compliance patterns, and have oversight over everything that's going on in a consistent way that really enables them to have that velocity in their business. And so when we then position things like industry cloud, we're leveraging IBM-specific technologies to deliver differentiated capabilities in data privacy, data protection, security and compliance, for these industries, in public cloud, yes, but it's in the context of helping our clients overall across all the different things, some of which may not need all of that data privacy or be leveraging particular SaaS content. We're looking to help them really have cloud architecture, have a holistic conversation across hybrid cloud, and yet to still be able to choose particular cloud deployments on our cloud for industries that enables data protection and policy for the most sensitive and enterprise grade things that they're looking to do at the core of their business. >> So speaking of hybrid hybrid cloud, the major cloud providers, Amazon, Microsoft, Google, Oracle's another one, all have on-premises offerings right now. Several of them are working with telcos to expand their reach out into co-location and into telecom data centers, all of this being to enable this distributed cloud fabric, a hybrid cloud fabric. What's IBM's play in this area? Do you have a similar strategy or is it different? >> Yeah, I really think, and I think you maybe wanted to get a little bit into trends and predictions here in this conversation, and we absolutely see that need for distributed cloud, for cloud to really be alive in all the places where it needs to be, in all the places that someone is doing business, and in a consistent way across cloud environments, to be one of those major trends that's emerging as a really hot conversation. We have introduced IBM Cloud Satellite, that is IBM's hybrid cloud, as a service platform. It enables our clients to leverage OpenShift and Kubernetes environments, developer tooling, consistency in a cloud catalog, visibility and control over all their resources across different environments, and to be able to run end-to-end with consistency from on-premises, to EDGE, to different public cloud providers, and this is absolutely something that, across industries but within, also, those industries, that we're focused on in particular, that we're seeing a lot of interesting conversations emerge, because if cloud is everywhere, if cloud is distributed and can be on premises and in public cloud, it enables this consistency and this parity, really that brings together that seamlessness, not just the random acts of cloud usage. It means that using cloud can be something that drives speed of release of new product. It means that you can deliver more capability and functionality into a retail outlet where you're doing business, or a banking brick-and-mortar location. You can have AI for IT ops and understand what's going on across those different environments, and ensure things are kept secure, and patched, and updated, and you're responding to incidents in efficient ways. And so, really, having a consistent cloud environment and a distributed cloud environment across different locations, it's really key to leveraging the promises of what everyone had originally hoped to get out of cloud computing. >> And of course, one of IBM's distinctive advantages in this area is, you've got a huge hardware install base out there. How do all those 360 mainframes figure into this? >> Yeah, with the OpenShift capabilities and our (audio skips) relations with Red Hat in this area, we are able to actually help our clients leverage Kubernetes, and Linux, and all those things, even on the mainframe. So across the mainframe family, the IBM power family, where folks may also have AIX or IBM i deployments, people can now do Linux, they can do OpenShift, they can do Kubernetes, and we have core technologies that enable that really to be stitched together, and I think that's one of the unique perspectives that IBM has in this whole conversation about hybrid cloud. There are many different definitions of hybrid cloud, but we really view it as stretching from the traditional enterprise IT, like you said, there's a lot of IT out there, and being able to also incorporate OpenShift and Kubernetes in a common cloud platform, on traditional enterprise IT, on private cloud, on fresh deployments, on private cloud, Amazon public cloud, that really is the whole IT estate. So when we talk about hybrid cloud, when we talk about distributed cloud, we're really talking about the entirety of the IT state, not just new deployments of SaaS, or something like that. >> So as someone who's on the front lines of what customers are asking about cloud, do you see customer, the questions that they're asking, changing? Are their decision criteria changing for how they choose a cloud provider? >> Yeah, I think that there's definitely a lot more conversation, and especially in this current era where there's an accelerated rate of cloud adoption, there's a lot more conversation around things like security, data protection, data privacy, being able to run in an environment that you trust not just, is it a cloud and what does it do, but can I trust it? Do I understand how my data is protected, how my workloads are secured? That's really why we started Cloud for Financial Services, because that industry shepherds such vital data, so the reason that they are highly regulated is because of the importance of what they are stewarding, very important data and financial information. So we began there with the Cloud for Regulated Industries, there with with Financial Services, but I see that across all industries. I was participating on a panel with a bunch of CIOs, and I was there interviewing some CIOs who were from a much more consumer-facing, and also from from foods industry, et cetera, and their conversation was exactly the same as I have with many other clients, which is that their cloud choices, their efficiency in cloud deployment, now are largely driven by the ability to get to a secure posture and the ability to demonstrate to their internal security and risk teams that they understand their data protection and data privacy posture. So we are seeing lots of pickup and conversation opportunity around confidential computing, specifically, and that's really about enabling our clients to have full authority and privacy in their computing, in their code, in their data, even when running in a cloud environment. And so I do see a shift. Everyone's more concerned about security, and I think we have great technologies, and we've been working with core partners to establish, and harden, and create generations of technology that can really answer those questions. >> I have to ask you about that term, confidential computing. I haven't heard that before. What does that involve? >> Yeah, it is a buzzword to watch out here for in 2021. So confidential computing means being able to run in an environment where there are others, in a cloud computing environment, for example, but still have full privacy and authority over what you're doing. So you are effectively in an enclave. Imagine yourself protected and secured. And so our confidential computing technology is, we're actually on, basically, our fourth generation of the hardware and software technologies to create that strong degree of isolation. This enables us to deliver a really rich portfolio, frankly, the richest portfolio in the industry, of actual services delivered using confidential computing and secure enclaves. And so we can enable our customers to solution things in a way, for example, where their data can not even be visible to our cloud operators, or where they retain full control over a database, and have full privacy as they're running in that environment. These are really great considerations, but they impact everything from health care, financial services. We have other partners and clients who are working to protect consumer data through these means, et cetera. And so across different industries, everyone's really looking at this topic of data privacy and data protection. And so we have a whole suite and a whole family of confidential computing-based services that we're able to offer, to offer those assurances and that privacy to them in their cloud computing. >> I do have to ask you about the multicloud, because this is a topic of constant debate in the industry of whether customers want to shift workloads across multiple clouds to protect themselves from lock-in. Is that a fantasy? Is that too restrictive? This has been a key part of IBM strategy is enabling the multicloud. How do you see customer attitudes developing right now? How do they want to use multiple clouds, or, in fact, do they? Are they concentrating perhaps more of their workloads in one or two? >> Yeah, we believe vendor lock-in goes against the true spirit of hybrid cloud, that desire to have consistency across environments, that desire to- and the business need to have continuity and resiliency and operations, et cetera, and so I do see this as a really important topic. From the perspective of managing environments, I think in multicloud, I think folks are starting to realize that multicloud isn't necessarily a strategy, it's a reality. People have deployments in lots of different cloud environments that happen somewhat organically, in many cases, and so the key question is how to then get to visibility and control over those resources. I think two of the core topics in that are multicloud management, being able to understand clusters, and virtual machines, and other things that are deployed across different environments, and manage them with a common set of policies, for example. And then, in addition to multicloud management, AI for IT operations is another really important topic in multicloud, being able to respond to incidents, understand and analyze and leverage AI for understanding what's going on across those environments is another really core topic. And then as you said, distributed cloud is a means of getting that consistency. Having a common control and deployment plane across those different environments can help it not just be accidental usage of multiple cloud environments, but very intentional deployment, based on the needs of particular workloads to the environment that they're best suited to. And that's really what you want to aim for. Not that multicloud is necessarily, I guess I would say, is a- It is a complexity that is manageable through these new types of technologies and multicloud management, and such like that, and distributed cloud. >> Well, Hillery 'tis the season for predictions, it's January. Everyone's prognosticating about what the future will look like. What do you think are going to be the main trend lines in cloud this year? >> Yeah, I sprinkled a few in there as we were talking, but I really do think that the conversation around hybrid cloud, number one, how to have an open innovation ecosystem for cloud, where you have consistency across environments, not just random acts of cloud usage, but intentional and holistic architecture. I really see that as the transition, as the second wave of of cloud adoption. And then, secondly, is we were talking earlier about security. Everyone is wondering about data policy, data privacy. We've always taken a strong stance that our client's data is their data. We are not going to be using their data to further develop our AI services on our cloud, or something. We have deployed technologies in confidential computing that enable them to keep full control over their keys so that even our cloud operators don't have access to data, computing in secure enclaves where they have a strong degree of isolation and full privacy and authority over their workload. I really think these two topics, open and secure hybrid computing and with consistency across environments, with distributed cloud technology, and secondly, security. I think these are really important topics for 2021. And they may seem a little bit obvious, but I think it's important as people look at this to look for technologies that are multiple generations into this journey, partner with folks who are committed very clearly to an open ecosystem and open source innovation on the one hand, and secondly, when we talk about security and data protection, you want to know that that provider is several generations into that journey so you really know that that technology has been vetted out, is at production scale, and has a stable basis. And so I think this is the year when folks are transitioning from cloud adoption to consistency in cloud, and security and privacy in cloud. >> A final question, and it has nothing to do with cloud. You're an IBM Fellow, and I see that term turn up occasionally with other other people I've spoken to from IBM. What is an IBM Fellow, how do you become one, and what privileges and responsibilities does it entail? >> Yeah, it's an exciting opportunity to be an IBM Fellow. There's about a hundred active IBM Fellows right now, so there aren't too many of us, but there is a small community of us. IBM Fellow is IBM's highest technical designation within our technical population, so I do have a role within our cloud business, but as one of our technical leaders, get to interact with the other Fellows, work on strategy for IBM in technology overall as a company, and I also get to be a trusted advisor to many of our clients, and so I get to work with CTOs and CIOs and VP of Application Development profiles, and VP of IT, and things like that, in our different clients, and really help them wrestle through those struggles of future IT transformation. And so part of what I enjoy most about the role, and the Fellow role, is being able to be that trusted advisor to many of our clients. There's been so much change in this last year for everyone, and being able to also help our technical population through that, in various means, and then help our clients through all of that change, and really being able to take and grasp onto the opportunities that this last year has had in the way that we work has changed, and the way that companies are looking to deliver capabilities has changed. So that's, for me, the exciting part of the role. >> Well, you're one in a hundred, then, and you do a great job of articulating the IBM strategy, and also the cloud landscape. Hillery Hunter, VP and CTO, excuse me, CTO of IBM Cloud, thank you so much for joining us today on Cube on Cloud. >> Thanks so much for having me. It was a pleasure. >> I'm Paul Gillin, stick with us. (upbeat music)

>>from around the globe. It's the Cube with digital coverage of AWS reinvent 2020 sponsored by Intel AWS and our community partners. Welcome to the cubes Coverage of AWS reinvent 2020. The digital version I'm Lisa Martin and I'm joined by a couple of guests from Unisys. Please welcome unprompted high BP and Cloud CTO on income. Great to have you on the program. Thanks for joining me today. >>Great to be here leader >>and a new pre or a new Ram Raj, VP of Cloud Services. A new welcome. Great to have you on a swell. Great >>to be here in this virtual AWS being that great. >>Thank you. Very socially Distance We're following all the guidelines here. A new Let's start with you. I'd love to get just kind of Ah, you know, a vision of the AWS Unisys partnership. I know you guys are advanced consulting partner MSP. Tell me about that partnership. >>Absolutely. Lisa, we see our clients on a cloud journey which we accelerate with Unisys Cloud Services and AWS partnership is a big piece of that again. Way thorough. We have bean rated in aws MSP partner Come out very, very highly from those msb audited our, uh and we're investing in multiple competencies across the boat as well. So and we work very closely with AWS in terms off innovating in sharing our platform cloud 44 world map In looking at what our customers looking around the corner, what services could be co developed. So we're looking at some potential I o T engagements to jointly with AWS is, well, eso you're always co inventing and it's a great partnership with a W s >>excellent. And you let's stick with you Following on hybrid Cloud Journey you mentioned the Cloud Forte platform. I wanted to understand what that platform is, how your co developing that with AWS and how your customers are benefiting >>absolutely s. Um, every year Unisys does a cloud barometer study across thousands of our clients and and we got some interesting takeaways from that. Essentially two thirds of her clients that have started this cloud journey believe they don't really realize the benefits out of that and up thio 53% off. The the respondents said they needed some help with cloud security. And this is where I believe that Unisys Cloud Services has a strong viewpoint and can find their AWS, um, journey, no matter where, what challenges they're facing, whether it's budgetary challenges on optimizing AWS and whether it's getting I t operations right when you move your applications to AWS. Um, and is it is it getting the that I have seen cops models established? So no matter where clients are in the A journey, we look to accelerate with our set of solutions and services, and we're very proud about the fact that we respond very me to make sure our clients can innovate and achieve the business outcomes that they need. For example, with California Stink City, we were able to work with them on the AWS. John Pretty set up a native other lake and analytics on top of it so we could actually predict and influence graduation rates with students. Our scores are higher than any off are coming because of the outcomes that we deliver for our clients. And it's really about business outcomes and 40 platform, which helps us drive those outcomes. I mean, probably do you want to add on without cloud 40 platform? >>Sure, I know eso, as as I knew was saying cloud for the platform provides AH set off capabilities that allows us to create an offer highly differentiated services with Unisys Pipe and, as was mentioned earlier, our cloud solutions are are able to help customers no matter where they are in their car, in their cloud journeys, whether it's ah Greenfield opportunity, where they where the customers are intending to move to the cloud, or if it's a brownfield opportunity where they already have adopted the cloud and are looking to manage and operate and optimize their deployments. Cloud Forte Platform and our Cloud Solutions are able to provide, uh, customized solution for that customer context to really deliver the solution that addresses some of the pain points that you talked about. The keeping points really relate to security to get secured. It also relates to cost optimization and then optimizing the cloud purse, a cloud deployment hybrid cloud deployment of the key requirement. So our cloud 40 platform health drives the key use cases. The key pain points that our customers are looking for through a combination off accelerators, the number of cloud photo accelerators that enable customers to rapidly prove it provisioned customers and to rapidly migrate to the cloud with God rails so that they're the secure, their compliant. And then we've got the the Cloud Cloud 40 Cloud management platform for ensuring provisioning onda management and operations, along with cost optimization capabilities and the eyelid operations. So it's a comprehensive suite off services and solutions that addresses the key business outcomes. There are customers are are looking for >>outcomes. Focused is absolutely critical, especially these days. I knew I wanted to go back to you for a second. You talked about the Unisys Barometer study, and I like the name of that. When was that done? And I'm just wondering if there are certain things that you saw this year from a customer. Cloud journey. Need perspective because of the pandemic that have really influenced that barometer >>Wait Question. Hey said and development is study. The last version of it was done late last year, and we're still waiting on the ones from this year. So, but we're starting to see some of the trends that were influenced by the pandemic. We saw rush to cloud when the pandemic hit because business adopt to to remote workers to do more digital selling and then seeing our CEO is kind of struggle with optimizing and maximizing the results off their cloud. Spend right, So So that's a unique challenge that that we're seeing based on our tryingto interaction. So the rush to the cloud and the ask for more spend optimization and in terms of spend optimization, that's an interesting facet because, uh, it cuts through my multiple angles. It's it's cuts through having the platforms around, being able to dio right predictions on where you spend is going, and then it also it's across collaborative effort. Finn ops. As we see it, we call it as a synopsis of is that we bring to our clients it's passing with multiple organizations, including finance, to sometimes figure out. Where will this business be? Where should you spend be? What should be the reserved instance buys right. So combining cloud knowledge with financial knowledge and organizational and business knowledge. And that's the service that we bring to our clients with our phenoms services. At least a great question about how how is I kind of making the current business climate affecting our operating models? Um, like we said, there's increased ask for Finn ops is an increase. Ask for security ops because security threats have only amplified. And then the entire cloud ups model. I think hybrid cloud operations its's prompted us to rethink a lot off. How do we do? I t operations and and we're investing a lot in terms of automation and then underpinning that by ai led operation. So, um, you talked about the client management platform making sure we've got the best automation and processes which are repeatable around all the way from just doing provisioning to data operations to optimization. Just making all of that robust and repeatable um, is such a value. Add to clients because then they can see SOS can sleep at night knowing that everything is taken care off and, uh, the CIA, the CEOs can be rest assured that hey, they're not going to get that AWS bill that's going to make them hit the roof. So making sure we've got the right checks and balances and approval flow is all a part of our child management platform. And at that point, I know you really passionate AI and the role that it plays in operations and the entire cloud management platform and cloud for day platform So your thoughts in the poem? >>Yes, sir. No, thank you. But so yeah, yeah, I led operations is really part off the bigger question and the pain point that customers are faced with, which is I've reached the cloud. Now, how do I optimized and get benefits from the cloud on the benefits is around. You know, uh, utility for on demand access to resource is, uh, this cost optimization potential and the security, uh, cloud security potential that, if not managed properly, can really blow up in the face. And unfortunately, you know that in the case on the AI ops led Operation Side, that's again a huge foretell area where Unisys Investor is investing a lot off a lot off i p and creating a lot of differentiation. And the objective there is to ask Customers adopt cloud for day as they adopt Unisys Cloud services. They're able to take advantage off cost optimization capabilities, which essentially looks at historical usage on predicts future usage, based on a number off a I artificial intelligence and machine learning technologies that that is able to give you predictions that otherwise very hard to hard to get and, uh, in the cloud environment because of the sheer velocity volume and variety of the data. Doing that in a manual fashion is very, very hard. So automated machine learning driven approach is very productive is very effective on, you know, some of the outcomes that we've achieved is is just amazing. We've been able to save up to 25% off infrastructure costs through the island operations. About 40% off infrastructure incidents have bean reduced due to root cause analysis. Eso onda up to 35% off meantime, to resolution improvements in time. So huge customer benefits driven by e I led operations. The I am a approaches to following the problem. >>Let me see him If I could stick with you for a second big numbers that you just talked about and we talked a few minutes ago about outcomes. It's all about outcomes right now with this rush to cloud as as a new set. And we talked about this on the Cuba all the time. We've seen that the last eight months there is an acceleration of this digital transformation. I'm just curious una come from your perspective as the VP and CTO cloud how are you? What are some of the things that you advise customers to do if they need to rush to the cloud 21 just, you know, move their business quickly and not have the stay on life support. What are some of the things that you advise them to do when they're in this? Maybe a few months ago, when they were in the beginning of this? >>Yeah, that's that's a very interesting question, and lot off our clients are faced with that question as they either they're already in the cloud or the deciding to migrate to the cloud on the whole journey. Customer journeys for either stepping on the cloud or managing and operating the optimizing the cloud deployments is very key. So if you look at the market research that's out there and what we hear from our customers, the key challenges are really, really around. How do I migrate to the cloud without facing a lot of bottlenecks and challenges, and how do I overcome them? So that's the keeping pain point and again cloud for the advisory services and the cloud services that we offer allows customers to take up uh, toe work with us, and we work with the customer to ensure that they're able to do that on and then rapidly migrating to the cloud, managing and operating their operations. The hybrid cloud operations in optimized fashion is a huge challenge. How do they migrate? How do they migrate with security and compliance not being compromised once they're in the cloud, ensuring cloud security is and compliance is is maintained. Ensuring that the cost structure is is optimized so that they're not being mawr wants to move to the cloud compared to on premises and and then taking advantage of the whole cloud. Deployments to ensure you're looking at data are nothing the data to derive meaningful business outcomes. So if the entire end to end customer journey that needs to be looked at optimized. And that's where Unisys comes in with a cloud for the platform where we work with the customers to enhance the journeys. And in this case I want to mention CSU, which is, uh, the California State University, where the approach Unisys to really work with them to deliver uh, cloud services by enhancing the the objective was to enhance the student learning experience to enable adoption off off the technology by the students but also to achieve better performance, better adoption cost savings on we were able to deliver about 30% better performance help realize about 30 33% savings on 40% plus growth in adoption. On this was for about half a million student bodies. The 50,000 plus faculty staff spread across 23 campuses. So deploying, optimizing on and managing the infrastructure is something that Unisys does. Does that. And this is an example of that. I know you want to add anything to that. >>Absolutely Any Permanente's really well and, >>uh, >>it Z also securing, making sure securities with the >>journey >>it Z O Keefe or hybrid cloud. Um, uh, at least I'm sure you're aware of the Unisys tagline is securing tomorrow. So who better s so we really, really take that really, really seriously in terms of making sure we seek clients cloud journeys, and >>you >>probably heard the statistic from her. About 80% off cloud breaches are due to mis configuration, and this could have bean prevented. And and it doesn't. There's an element of the human angle in there. You believe strongly that can automate using our platform. So we've got 2000 plus security policies, which makes sure which again enables our clients to be compliant as well. So no matter what compliant standards, we've got several off our clients, for example, in the financial sector that are hosted on AWS and that we managed and they have to, especially the US They have to comply with Y de f s, the New York Department of Financial Services and making sure that they compliant with all the standards out there, which is next plus plus in this case. So that's part of what we do and enabling those journeys and then just keeping up with the rate of change like on different was talking about the variety and velocity of the data and and the rate of change of the applications out there, especially as businesses react to the pandemic and have to cope with the changing business paradigms out there. They have to be quick. Um, so we've got a drugmaker, one of the most premium drug makers in the US, who is who is against it on AWS, and, uh, they're racing for the cure and they are always looking at How do they get drugs quicker to the market? And that means accelerating applications. And we know that based on research by the Dora study, that if you adopt develops paradigms, you can accelerate 200 times faster than if you didn't. But then you have to underpin backward security as well. So really helping this adopt deaths are cops in all their deployments to AWS so that they can really race for the cure. That's the kind of business outcomes that we really, uh, are really, really proud to drive for our clients. >>Excellent on a pound. Let's wrap this up with you. We've just got about 30 seconds left sticking on the security front. It's such a huge topic right now. It has been for a long time, but even more so during these unprecedented times when you're talking with customers, what makes Unisys unique from a security perspective? >>So first thing is to understand what it takes to solve the hybrid cloud security problem. Like you said earlier, that's the biggest pain point that we hear from customers from our clients on. It's all over the market research all the breaches that have happened, like the zoom breach that happened that compromised about half a million, you know, user log ins. And then there was also the the Marriott breach, where about half a billion users names and credential for legal legal. So it Zaveri easy for customers, potential customers to become like a headline. And our our job really are the companies to make sure that they're not the next capital one or the next Marriott, uh, showing up in the newspaper. So we kind of look at their customer deployments situation on. We put together a comprehensive into an hybrid cloud solution, hybrid cloud security and compliance solution that includes look, securing their cloud infrastructure, their cloud workloads in terms of applications that they might have secured, and also to look at securing their applications, which may or may not be running on the cloud. So we kind of take a very holistic approach, using our homegrown solutions and partner solutions to create a comprehensive, robust hybrid cloud solution that really fits the customer context and and so we we are essentially a trusted adviser for our for our clients to create the solution, which again, at the cloud 40 ashore, which is a cloud security posture management solution. We have a cloud worker protection solution on then stealth, which is a full stack security solution if combined together with the other cloud Forte platform components on. We wrap this up in a matter of security services offering that allows US customers to have complete peace of mind as we take care off assessment remediation monitoring on, then continues Posture, posture, management. I know. Do you want to add anything to that? >>If I'm think in terms of closing, I think like you covered it well, we've got platform competence and services that run the gamut off the off the life cycle from migrations to two transformations. And one thing that I think in terms of outcomes of these, uh, when the service built around it have really helped us. Dr is, um is kind of responding especially to our public sector clients, very passionate about enabling cloud journeys for our public sector clients. And we'll take the example of Georgia Technology s So this is the G t A. Is the technology agency for all services are 14 of the agencies in Georgia and many of these public sector agencies had to quickly adopt cloud to deal with the report workers. Whether it was v D I whether it was chatbots on cloud, um, it was it was, ah, brand new world out there, the new normal. And it was just using the cloud management platform that anyone was refering to. We were able to kind of take them from taking three months. Plus to be able to provision workloads Thio thio less than 30 minutes to provision workloads. And this is this is across hybrid cloud. So and this is >>a big outcome, especially in this time where things were changing so quickly. Well, I wish we had more time, guys because I could tell you have a lot more that you can share. You're just gonna have to come back. And I like that. The tagline securing tomorrow. Adding on to what Anu Pump said So your customers don't become the next headline. I think they would all appreciate that. Thank you both. So much for joining me on the Cube today and sharing what's the latest with Unisys. We appreciate your time. Thank you. Thank >>you for having us >>aren't my pleasure for my guests. I'm Lisa Martin. And you're watching the Cube? Yeah,

from the cube studios in Palo Alto in Boston connecting with thought leaders all around the world this is a cube conversation on June 23rd the Wall Street Journal reported that Dell is exploring strategic options for its approximately 81% share in VMware both Dell and VMware stocks popped on the news we believe that Dell is floating this trial balloon to really gauge investor customer and partner sentiment and perhaps send a signal to the short sellers that you know what Michael Dell has other arrows in his quiver to unlock in case you want to squeeze me I'm gonna squeeze you back who knows hello everyone and welcome to this week's wiki Bond cube insights powered by ETR in this breaking analysis we'll unpack some of the complicated angles in the ongoing VMware saga and assess five scenarios that we think are possible as it pertains to this story as always we're going to bring in some ETR customer data to analyze what's happening with the spending picture let's take a look at what happened and just do a quick recap The Wall Street Journal story said that Dell was considering spinning off VMware or buying the remaining 19 percent of VMware stock that it doesn't own the Journal article cited unnamed sources and said that a spinoff would not likely happen until 7 September 2021 for tax reasons that would mark of course the 5 year anniversary of Dell acquiring EMC and would allow for a tax free transaction always a good thing what's going on here and what options does Dell really have what does it mean for Dell VMware customers and partners we're gonna try to answer those questions today so first of all why would Dell make such a move well I think there's tweet from your own name Marc he's a portfolio manager at one main capital it kind of sums it up he laid out this chart which shows Dells market cap prior to the stock pop you know it's closer to 38 billion today and the value of its VMware owner which is over 50 billion since the stock pop but let me cut to the chase investors value the core assets of Dell which accounts for around 80 billion dollars in revenue when you exclude vmware somewhere south of negative 10 billion dollars why it's because Dell is carrying more than 30 billion dollars of core debt when you exclude Dell Financial Services and it looks like a conglomerate owning the vast majority of VMware shares Michael Dell has something like a 97 percent voting control Cordell is a low margin low growth business and as some have complained that Michael uses VMware as his piggy bank and many investors just won't touch the stock so the stock generally Dell stock has underperformed I've often said even going back to the EMC days that owning the stock of VMware's owner is actually a cheap way to buy vmware but that's assuming that the value somehow gets unlocked at some point so Dell is perhaps signaling that it has some options and other levers to pull as I said you may be trying to give pause to the shorts now let's have a look at some of the ETR spending data and value and evaluate the respective positions of Dell and VMware in the market place this chart here uses the core ETR methodology that we like to talk about all the time for those not familiar we use the concept of net score net score is a simple metric it's like Net Promoter Score sort of the chart shows element the elements of Dells net score so each quarter ETR goes out and ask customers do you plan to adopt the vendor new that's the lime green at 4% spend more relative to last year more meaning more than 6% that's the forest green and you can see that's at 32% flat spend is the grey meaning plus or minus 5% and then decrease spending by 6 percent or greater that's the pink and that's just 11% for Dell or are you replacing the platform to see that that's the bright red there at 7% so net score is a measure of momentum and it's derived by adding the greens and subtracting the Reds and he can see Dell in the last ETR survey which was taken at the height of the pandemic has a net score of 18% now we we colored that soft red it's not terrible but it's not great either now of course this is across Dells entire portfolio and it excludes vmware so what about vmware so this next graphic that we're showing you it applies the exact same methodology to vmware and as you can see vmware has a much higher net score at 35% which of course shouldn't surprise anybody it's a higher growth company but 46% of vmware customers plan to spend more this year relative to last year and only 11% planned to spend less that's pretty strong now what if we combined dell and vmware and looked at them as a single entity hmm wouldn't that be interesting okay here you go so there were nine hundred and seventy five respondents in the last ETR survey when we matched the two companies together and you can see the combined net score is 27% with 42 percent of respondents planning to spend more this year than they did last year so you may be asking well is this any good how does this compare to dell and vmware competitors well I'm glad you asked so here we show that in this chart the net score comparisons so we take the combined dell and vmware at 27% Cisco as we often reported consistently shows pretty strong relative to the enterprise data center players and you can see HPE is a kind of a tepid 17 percent so it's got some work to do to live up to the promises of the HP HPE split we also we also show IBM red hat at 14% so there's some room for improvement there also and you can see IBM in the danger zone as we break that down and red hat much stronger but you know what it softened somewhat in the EGR survey since last year so we'd like to see better momentum from IBM and RedHat it's kind of unfortunate that kovat hit when it did his IBM was just kind of ramping up its RedHat go to market now just for comparison purposes for kicks we include Nutanix nifty annex is a much smaller company but it's one that's fairly mature and you can see at 52% its net scores much higher than the big whales now we've been reporting for months on high fliers like automation anywhere CrowdStrike octa rubric snowflake uipath these emerging companies have net scores you know north of 60% and even in the 70% range but of course they're growing from a much smaller base so you would expect that now let's put this into context with a two-dimensional view that we'd like to show now as you know in addition to net score that metric we like to use so-called market share market share is a measure of pervasiveness in the data set or essentially market share in the survey and it's a proxy for a real market share so what this chart here does it plots several companies with their net scores on the y-axis and market share on the x-axis and you can see that we combine Dell and VMware together and we plotted them in that red highlighted box just for comparison purposes so what does this tell you about the competitive landscape well first everyone would love to be AWS Microsoft - we didn't plot Microsoft because they're so bloody dominant they skew the chart somewhat but they would be way way out to the right on the x-axis because they have such a huge number of products and mentions in the data set so we left them out now you can see vmware and cisco are kind of right on top of each other which is sort of ironic as they're you know kind of increasingly overlapping with their offerings in the marketplace particularly nsx and you can see the other companies and for context we've added a few more competitors like theme and CommVault and you know they're in a pretty strong position as well as the combination of Dell and VMware so let's start there Steve Phil analyst Brad Reebok was quoted in the market watch publication is saying the following we have long believed Dell would ultimately buy in the approximately 19% our 12 and a half billion of VMware that it does not own in order to gain full control over VMware's substantial free cash flow which is about four billion dollars annually and we still expect this to be the ultimate outcome huh you know I don't know I'm not sure about this on the one hand you can see from the previous chart this would be a better outcome for Dell from a competitive standpoint what it did is it pulls Dell up and to the right yeah but perhaps not so much for VMware as it went down and to the left adèle would have to raise a bunch more cash to do this transaction and what take on even more debt you know maybe it could get Silverlake to finance the deal you know then essentially Dell would become the Oracle of infrastructure you know it certainly would make Dell even more strategic to CIOs would that be good for customers well on the one hand I guess it would bring better integration between Dell and VMware yeah but I wonder if that's the critical issue for customers yeah and nearly and I think it would stifle VMware's innovation engine and a little bit further and I wonder how Pat Yeltsin here would react I mean my guess is he would call it a day and what about Sanjay Putin who was the obvious next in line for the CEO job at VMware what he becomes the president of Dells software division and what about the rest of the team at VMware yes they're a Silicon Valley stalwart and that would slowly morph into austin-based Dell with the debt burden growing you know it's gonna mean more of VMware's cash would go to paying down the debt meaning less for R&D or even stock buybacks what you know I'm not a huge fan of and I'm not a huge fan of this scenario for sure the the technology park partner ecosystem would be ice cold on such a deal although you know you could argue there are already less than lukewarm but here I want to explore some other options so the next on the list is Dell could sell VMware to a private equity firm mmm or a strategic it could basically wipe out its debt and have some cash left over to sail into the sunset that would be a big pill for someone to swallow even though Michael Dell has 97 percent voting power I think there's fine print that says he has a responsibility to protect the interest of the minority shareholders so to get approval it would have to sell at a premium you know that could be as high as you know almost seventy billion dollars Microsoft has the cash but they don't need VMware and Amazon I guess could pull it off but that certainly is not likely even if Google who has the cash we're interested in buying VMware Google be the most likely candidate you know it would give Google Cloud instant access to the coveted enterprise but it's really hard to conceive I mean same for a PE company 65 to 70 billion you know they get their money out in 15 to 20 years so I I just I just don't see that as viable all right what's next how about this scenario of spinning off VMware that the Journal reported so in this transaction Dell shareholders would get a bunch of vmware stock now there may be some financial wizardry that tom sweet dell CFCF owned his band of financial geniuses could swing I can't even begin to speculate what that would be but but I've heard there's some magic that they could pull off to maybe pull some cash out of such a transaction and this would unlock the value of both Dell and VMware by removing the conglomerate and liquidity hangover for Dell and it were to definitely attract more sideline investors into VMware stock and Michael Dell would still own a boatload of VMware stock personally so there's an incentive there so this is interesting and certainly possible you know I think in a way it would be good for VMware customers VMware we get full autonomy and control over its destiny without Delvaux guarding its cash so it could freely innovate Dell would become probably less strategic for customers so I don't think that for Dell EMC buyers you know the technology ecosystem partners like HPE IBM Napa cetera would would would they would like it more but they were already kind of down the path of looking to optimize VMware alternatives so you know think about Cisco but you know I think for VMware customers okay I think for for daily MC customers not so much now what about the do-nothing scenario you know I think this is as possible as any outcome Dell keep chipping away at its debt using VMware as a strategic linchpin with customers sure they continue to pay the liquidity overhang tax and they'll frustrate some shareholders who we're going to remain on the sidelines but you know that's been the pattern anyway now what about delivering some of the VMware ownership so the more I think about it the more I like this scenario what if del sold 20% of its VMware stake and let's say raised ten twelve billion dollars in cash that it could use to really eat into its debt burden a move like this combined with its historical debt pay down could cut its death debt in half by say 2021 and get the company back to investment grade rating something that Tom sweet has aspired towards this one dropped hundreds of millions if not a billion dollars to the bottom line and it would allow Dell to continue to control VMware what I don't know I don't know if there are nuances to this scenario in other words does this dropping ownership from roughly eighty percent to about sixty percent trigger some loss of control or some reporting issue I'm sure it's buried somewhere in the public filings or acquisition Docs but this option to me makes some sense it doesn't really radically alter their relationships with customers or partners so it's kind of stable with VMware maintains its existing autonomy and even somewhat lessens Dale's perceived control over VMware in an attacks Dells debt burden yeah it's still a bit of a halfway house but I think it's a more attractive and as I said stable option in my view okay let's talk about what to look for next you know it looks like the stock market is coming to the reality that we are actually in a recession although it appears that Nasdaq is trying to ignore this or maybe the the markets a little bit off because they're afraid Joe Biden is gonna win the election he's not gonna be good for the for the economy we'll see we'll see what the economic shutdown means for tech companies in this earnings season etrs next survey is in the field and they're gonna have fresh data on the impact of kovat going into the dog days of summer here's what I think let me give you my preview and you'll see in a few weeks you know how accurate is I believe that tech spending is going to be soft broadly I think it's gonna especially be the case for legacy on-prem providers and expect their traditional businesses to to deteriorate somewhat I think there's gonna be bright spots in text protect for sure the ones we've reported on cloud yes absolutely automation you know I'm really looking closely at the battle between the two top our PA vendors automation anywhere in uipath I think there's a really interesting story brewing there and the names that we've been pounding like snowflake the security guys like CrowdStrike and octa and Z scalar I think they're gonna continue to do very well with this work from home pivot we also expect Microsoft to continue to show staying power but because of their size you know they're exposed to soft demand pockets but I think that continue to be very very strong and threatening to a lot of segments in the market now for Dell I think the data center businesses continue to be a tough one despite some of the new product cycles especially in storage but I think dal is gonna continue to benefit from the work from home pivot as I believe there's still some unmet demand and laptops we're gonna see that I believe show up in Dells income statement in the form of their their client revenue I'd love to know what you think you could tweet me at Devante or you can always email me at david dot Volante at Silicon angle com please comment on my LinkedIn post always appreciate I post weekly on silicon angle calm and on wiki bond calm so check out those properties and of course go to e TR dot plus for all the survey action as I say e TR is in the field with the current survey they got fresh Cova data so we're excited the report on that in the coming weeks remember these episodes are all available as podcast wherever you listen this is Dave Volante for the cube insights powered by ETR thanks for watching everyone we'll see you next time [Music]

(upbeat music) >> Announcer: From New York, it's theCUBE. Covering ESCAPE/19. >> Everyone, welcome to theCUBE coverage here in New York City for the ESCAPE Conference 19. This is the inaugural event for multicloud, I think it's the first industry event for, really talking about multicloud and the impact to enterprises and public cloud. My next guest is Steve Mullaney, President and CEO of Aviatrix, storied career in tech, been there done that, seen many waves of innovation. Nicira, Palo Alto Networks, and now Aviatrix. You retired for a while, welcome back! >> I did, yeah, five years, yeah, yeah, yeah. >> Welcome to theCUBE. >> Thank you, thanks for having me. >> It's nice to have you on because I think you have a good perspective on the multicloud because you've been in the industry since the 80s. We've both been broke in at the same time. And we've seen the waves. >> Oh, yeah. >> This wave is bigger than, I think, most of the other waves combined because it brings together so many things, infrastructure, software, cloud scale, and a new modern application environment. And then you complicate everything by throwing IoT out there, edges being pushed to their boundaries, securities equations changed, all this is going on right now, all at the same time. >> No, and that's why I was basically retired for five years, and I was at Nicira, we got bought by VMware, I stayed there for a couple years, and I just said, "Okay, that's it!" I've had a good career and I'm done. And about a year ago, the world changed. And it felt like on a Tuesday morning, I noticed enterprises really, we'd been talking about cloud for 12 years. And five years ago they said, "We're coming in, we're going to do it," but they didn't really mean it. But about a year ago, all in the same day, every enterprise said, "No, now we actually mean it." And I don't know why, I don't know if it was just people retired or just five years of talking about it, they all decided, we're comin' in, and enterprises all moved together. And this wave, as you said, is bigger than, I was around in 1992, in the early 90s, in the movement from mainframe to client server. This is 10 times bigger than that. And more importantly, it's going to happen 10,000 times faster. Because (fingers tapping). What's that? I just deployed 62 data centers around the world. Because if I can leverage the greatest infrastructure built, basic infrastructure of the hyperscalers, AWS, Azure, Google, Alibaba, Oracle, you name it. It's unbelievable the velocity at which you can now start deploying. >> Steve, I think you're onto something big here, and this is why I'm here at this event and why I'm excited, that a lot of the industry thought leaders and practitioners and leaders are doing this event. Small events, inaugural, but I think it has a lot of links. Because there's a lot of tell signs that I like to look at, one is cloud. I've been covering Amazon eight years now, with theCUBE, I've known AWS since it started, and I've done many startups in its launch using AWS. But I've had many conversations with Andy Jassy, one on ones, privately, I got an exclusive coming up for re:Invent with him. I've gotten to know him. It started out, "Everyone's moving to the cloud. "Every data center's not going to exist." And then, you know-- >> Oh, maybe not, yeah, yeah. >> Maybe not, we'll do an output. So I challenged him last year, I said, "Andy, come on, dude, like you were saying like a year ago that." >> Steve: Yeah, it's all AWS or nothing. >> And he said, "John, look I'm not, "I just listen to the customers." And I interviewed him when he did the VMware deal. And he's very customer focused. And when they make these moves with outpost, and I think it's going to be a hybrid message this year at re:Invent, you know it's real. >> Steve: Oh, yeah. >> I think this validates your point, so I got to ask you, what specifically do you see the formula being for multicloud, because certainly everyone's recognized that there's a huge benefit for AWS. But from a scale standpoint, so why not use that? What's going on on the Enterprise on-premise that's making this new thing work? >> I think it all starts with architecture, like anything else. I think right now, enterprises have said, "Okay, we've burned a boat, right? "Now, we're not going to get rid of our data centers, "but in terms of our strategic investment, "we are moving into the cloud. "We are going to leverage "the infrastructure of the hyperscalers. "And whether that is just one hyperscaler, or multiple." And I have not met an enterprise who thinks there only going to be one, right, every single one of them. Now, I don't think they're moving workloads across, I don't think that. I think they see that, I'm going to use Google for AI, I'm going to use AWS because it started there. I'm going to use Azure, for Office 365, and other different things, and everything in infrastructure is always multi. It's never homogeneous, right, it's always that. So I think is going to happen, and I think what people are begging for right now, is, I want to build an architecture that gives me the optionality to be able to deliver a common set of services whether I'm on AWS or multiple clouds. And I want them to be my services and I don't want to have understand the low level abstractions and constructs of each of those clouds, because their all different. One's metric, one's U.S., one's some other weird thing. And I don't have the time, the people, or the resources to be able to do that. Give me a common set of services, that are my services, that I can deploy and abstract away the details of those public clouds. >> Yeah, it's an interesting point there, in fact, I called BS on multicloud last year when it started to kind of rear it's head, I'm like, "Come on, multicloud is bullshit." And I said that on theCUBE. And here's what I meant. Multicloud as an operating model is directionally correct, but the architecture hasn't shown where there's true multicloud. Now, the fact of the matter is, people have Amazon, people have Office and Office 365, that's technically two clouds, >> They're siloed, yeah. >> If they give us Google, that's three clouds. >> I use two or three clouds. >> So, if he have three clouds, I guess they have multiple clouds. But you bring up an interesting point, and going back as a student of the history of tech industry, multi-vendor has been a big deal. >> It is a big deal. >> And like you said, there will be a multi-vendor world, that will happen. The question is how. How do you guys see it happening? >> Well I think what's-- >> Your company is attacking this Aviatrix. >> What's interesting is, so now you think about from a customer perspective which, I do the same thing, same thing with AWS. It's always outside in. Okay, I'm thinking as a enterprise IT person. I'm making the move. Do you believe that your basic infrastructure will lever the hyperscalers, or will you build an on-prem? Everyone says, "I believe that's the way I'm going to go." Great, how do I do that? So, I'm a IT architect, who do I go to to help me? Do I go to CISCO? No. The most shocking thing for me, of the six months I've been at Aviatrix, is that word's never used. It's like it was DEC or IBM in the conversation, when you were talking about client-server, no, why would you? CISCO, Juniper, Arista, any of the networking people, not even in the conversation. VMware, not really in the conversation. So, I don't have any incumbent vendor that I can go to that I used to go to. >> Why aren't they in the conversation? 'Cause of the commodity, they've been extracted away? >> I think it's just because it's the innovation of dilemma. Right, once you're selling a lot of stuff into on-prem, to then go and say, I mean you look at Palo Alto Networks, they're trying to make that transition. Acquiring a bunch of companies, VMware acquiring a bunch of companies. Why are they doing that? Because they know, I got to get off on-prem, everything's going in the cloud. >> So it's a legacy. >> It's a legacy thing, and I think what happens is, there is only one reason, and one reason only, an enterprise customer is not using Aviatrix. 'Cause they never heard of us. That's why, that's the only reason. Once they hear about what they're doing, my God. >> Well, give the plug, talk about the company, what do you guys do-- >> So we deliver, I mean it sounds like I made it up for this conference, but actually this conference was perfect for this. It's networking and security services for the multicloud enterprise. And we're building an architecture, that people can deploy, that will give them this common architecture across all the different clouds. So whether you're just using one cloud or multiple, it doesn't matter, it's the same set of security and networking services. And we do that by embracing and extending the basic constructs that AWS, Google, Azure, and Oracle, and all the other clouds will give you, and to deliver that real enterprise class. Because the other thing we've found is, everyone thinks that the cloud gives you everything and anything you will ever need from networking and security. Let's say AWS, they're going to do everything I need. What the enterprises are figuring out, is once they start going in, what they realize is, it's created for the low-level common basic constructs. And the enterprise starts at, well, I need these BGP feature because guess what, the data center is not going away. And I need more than a hundred route limitations, and I need, all of a sudden there's fifty different limitations AWS will give me. Well, they didn't talk about that! Well, of course they're not going to talk about that. They are just going to go check, check, check, we solve all your problems. As enterprises now move in, with mission critical applications, they're realizing, I need the same level of networking and security services that I had on-prem. I can't get that with the native constructs. So where do I go? That's what we do, so we fill in, we embrace what we can of those constructs, we fill in holes where there are fill in holes. And then we give you the mechanism to be able to orchestrate that across the global network. >> So you operationalize the hyperscale clouds for enterprise, >> Yes. >> that's basically what you do. >> Steve: Exactly, for the enterprise. >> Yeah, exactly. >> On the level that they need. >> So you get the benefits of the cloud, but all those nuances under the cover details like networking and other features you abstract that away and provide an operating model for enterprise compliments. >> And the beautiful thing about it is the velocity, at which we can, we're over the top, effectively over the top. We're integrated into the Cloud Suite, understand what cloud native, we understand all the constructs of accounts, and all the things we need to do. But what we expose to the customer, to the enterprise, is a set of over-the-top services that just work. >> Okay Steve, so I got to ask you, since we are at The Multi-Cloud Conference. What is multicloud, I mean how do you define it, you laid out a pretty compelling architecture of what needs are, levers in the cloud, and on-prem is what Aviatrix does. But what is the definition, how should people understand what is multicloud? >> I think for us, for networking and security in that base, so we're basic infrastructure. We get out there first, right? So, if you're going to build a city, you don't start putting people there first the first thing, if you do it right, is you get sewers, you get electricity, gas, roads, all that. Networking and security, infrastructure, is basic infrastructure goes out first. And you want to create an architecture that's going to live with you for twenty years. You don't want to have to rip up the roads and put the sewers in later. And that architecture needs to be multicloud because, even though you think maybe, most of our customers are 90% AWS right now. But every single one of them say, "But I'm moving to Azure, I'm moving to Google, "I've got retail customers that won't allow me "to put my infrastructure on AWS." Or, "I have machine learning, AI type apps on Google." They all say that same thing. But what they all then say to us, is, "You're going to be the mechanism "upon which I'm going to be able to deploy "this common set of services." So they don't need to know that. >> All right, give an example of a customer you guys have, name a name, we had a customer on stage here-- >> Steve: So, Jefferies. >> John: They did this for a use case. >> Yeah so, Jefferies. Financial Services Institution, lots of requirements, Mark Leon Soon is going to be on stage with me tomorrow. We started working with them about nine months ago. Exactly the same thing, they said, "Okay, you know what? "We need to start moving to the cloud, "we've got to start leveraging the cloud. "But, it's too complicated, right? "Even AWS, says 'Go Build.' "I don't want to go build, I want to consume services. "But they don't have all the service that I needed, "they're too low a level. "They're very high function, high enterprise requirements." So they start using us to orchestrate things, to provide transit networking, to provide egress filtering out to the Internet, we have high performance encryption, AWS will only offer it one gig. We can offer it to 10, 20, 30, 40 gig. So they start deploying, they start realizing all the things we do. Then they go and say, "I want to bring my Palo Alto Networks firewall "into the cloud." When you start looking at that, 'cause then guess what? All my policies, I want the same level that I have on-prem when I'm in the cloud. If I go try to bring in my VM series into AWS the construct that AWS give you, they cause you limitations in performance, in visibility, It's integration hassles, there's performance, sustainability, visibility issues, they force you to use SNAT. And there's all these issues, and they go, "Oh my God, this is a pain in the ass." We solved all that for them. We basically cloudify the VM series for them, so all those limitations go away. So that's just another use case that they use. Now they start looking, and they say, "Okay, now I'm going to start extending into other clouds and I want to use you as the common frame point, the common pane of glass. >> Well Steve, good luck in your venture, you're back in the saddle again. >> Steve: Yeah. >> Another ride here, you feel good about it? >> This is going to be the best, the biggest that I've been, and I was at Palo Alto Networks and VMware Nicira. And this one's going to be bigger than both of those. >> What's your vision for where this is going to be for you, where do you see the company in a few years, what are some of the outcomes you expect to happen? >> Our opportunity, and I look at it as, someone's going to take this opportunity, and the reason I came back is, why not us, someone's going to take it. And the opportunity, honestly, is to become, effectively, what Cisco was in the early 90's. To define the architecture, the networking and the security infrastructure architecture for enterprise customers. They are begging for that right now, that's our opportunity. >> Cloud Interoperability. >> Interoperability, yeah. And so there's so many things that we need to go and do. When you look at also the thing that people are going to say, the operations. So many people think, I want it the same as it was on-prem. I think with the cloud, and across multicloud you can do it right with us, and actually better. Because the visibility that you get is more, than what you get on-prem. >> Well, and the thing that's interesting that's different about this new world that we're talking about is that there is going to be constant improvements in new things which means that the functionality game is going to increase, which means the agility is even more important because the apps are going to have more things to do. >> Yeah. I mean in the end, why do you want to go to cloud? I want to go to cloud 'cause I want it to be self-service and I want agility. I want my developers, I want everybody to be able to do things quicker because all of the sudden they say, "Let's go roll this out", and you want to be able to do it. >> Well, good luck on the new venture, Aviatrix, check 'em out, hot multicloud startup, growing, how many people do you have, put the plug in, >> 100. >> what are you guys looking for, are you hiring, give me a quick plug. >> We just hired a new VP at World Wide Sales, James Winebrenner, who was Viptela CEO, VP Sales in Cisco, hiring a tremendous amount of sales guys right now, we're closing on a $40 million Series C round next week, and we're hiring a lot of people. >> Good luck, we'll be following you Steve, thanks for coming on and sharing your insights. Again, multicloud, this is a shift that's happening, multicloud is just another word for multi-vendor, in a new modern era, this is what it has been in the technology industry, but a whole new world. This is theCUBE coverage here in New York City, ESCAPE/19, I'm John Furrier, thanks for watching. (upbeat music)

(upbeat music) >> Announcer: From New York, it's theCUBE. Covering ESCAPE/19. >> Everyone, welcome to theCUBE coverage here in New York City for the ESCAPE Conference 19. This is the inaugural event for multicloud, I think it's the first industry event for, really talking about multicloud and the impact to enterprises and public cloud. My next guest is Steve Mullaney, President and CEO of Aviatrix, storied career in tech, been there done that, seen many waves of innovation. Nicira, Palo Alto Networks, and now Aviatrix. You retired for a while, welcome back! >> I did, yeah, five years, yeah, yeah, yeah. >> Welcome to theCUBE. >> Thank you, thanks for having me. >> It's nice to have you on because I think you have a good perspective on the multicloud because you've been in the industry since the 80s. We've both been broke in at the same time. And we've seen the waves. >> Oh, yeah. >> This wave is bigger than, I think, most of the other waves combined because it brings together so many things, infrastructure, software, cloud scale, and a new modern application environment. And then you complicate everything by throwing IoT out there, edges being pushed to their boundaries, securities equations changed, all this is going on right now, all at the same time. >> No, and that's why I was basically retired for five years, and I was at Nicira, we got bought by VMware, I stayed there for a couple years, and I just said, "Okay, that's it!" I've had a good career and I'm done. And about a year ago, the world changed. And it felt like on a Tuesday morning, I noticed enterprises really, we'd been talking about cloud for 12 years. And five years ago they said, "We're coming in, we're going to do it," but they didn't really mean it. But about a year ago, all in the same day, every enterprise said, "No, now we actually mean it." And I don't know why, I don't know if it was just people retired or just five years of talking about it, they all decided, we're comin' in, and enterprises all moved together. And this wave, as you said, is bigger than, I was around in 1992, in the early 90s, in the movement from mainframe to client server. This is 10 times bigger than that. And more importantly, it's going to happen 10,000 times faster. Because (fingers tapping). What's that? I just deployed 62 data centers around the world. Because if I can leverage the greatest infrastructure built, basic infrastructure of the hyperscalers, AWS, Azure, Google, Alibaba, Oracle, you name it. It's unbelievable the velocity at which you can now start deploying. >> Steve, I think you're onto something big here, and this is why I'm here at this event and why I'm excited, that a lot of the industry thought leaders and practitioners and leaders are doing this event. Small events, inaugural, but I think it has a lot of links. Because there's a lot of tell signs that I like to look at, one is cloud. I've been covering Amazon eight years now, with theCUBE, I've known AWS since it started, and I've done many startups in its launch using AWS. But I've had many conversations with Andy Jassy, one on ones, privately, I got an exclusive coming up for re:Invent with him. I've gotten to know him. It started out, "Everyone's moving to the cloud. "Every data center's not going to exist." And then, you know-- >> Oh, maybe not, yeah, yeah. >> Maybe not, we'll do an output. So I challenged him last year, I said, "Andy, come on, dude, like you were saying like a year ago that." >> Steve: Yeah, it's all AWS or nothing. >> And he said, "John, look I'm not, "I just listen to the customers." And I interviewed him when he did the VMware deal. And he's very customer focused. And when they make these moves with outpost, and I think it's going to be a hybrid message this year at re:Invent, you know it's real. >> Steve: Oh, yeah. >> I think this validates your point, so I got to ask you, what specifically do you see the formula being for multicloud, because certainly everyone's recognized that there's a huge benefit for AWS. But from a scale standpoint, so why not use that? What's going on on the Enterprise on-premise that's making this new thing work? >> I think it all starts with architecture, like anything else. I think right now, enterprises have said, "Okay, we've burned a boat, right? "Now, we're not going to get rid of our data centers, "but in terms of our strategic investment, "we are moving into the cloud. "We are going to leverage "the infrastructure of the hyperscalers. "And whether that is just one hyperscaler, or multiple." And I have not met an enterprise who thinks there only going to be one, right, every single one of them. Now, I don't think they're moving workloads across, I don't think that. I think they see that, I'm going to use Google for AI, I'm going to use AWS because it started there. I'm going to use Azure, for Office 365, and other different things, and everything in infrastructure is always multi. It's never homogeneous, right, it's always that. So I think is going to happen, and I think what people are begging for right now, is, I want to build an architecture that gives me the optionality to be able to deliver a common set of services whether I'm on AWS or multiple clouds. And I want them to be my services and I don't want to have understand the low level abstractions and constructs of each of those clouds, because their all different. One's metric, one's U.S., one's some other weird thing. And I don't have the time, the people, or the resources to be able to do that. Give me a common set of services, that are my services, that I can deploy and abstract away the details of those public clouds. >> Yeah, it's an interesting point there, in fact, I called BS on multicloud last year when it started to kind of rear it's head, I'm like, "Come on, multicloud is bullshit." And I said that on theCUBE. And here's what I meant. Multicloud as an operating model is directionally correct, but the architecture hasn't shown where there's true multicloud. Now, the fact of the matter is, people have Amazon, people have Office and Office 365, that's technically two clouds, >> They're siloed, yeah. >> If they give us Google, that's three clouds. >> I use two or three clouds. >> So, if he have three clouds, I guess they have multiple clouds. But you bring up an interesting point, and going back as a student of the history of tech industry, multi-vendor has been a big deal. >> It is a big deal. >> And like you said, there will be a multi-vendor world, that will happen. The question is how. How do you guys see it happening? >> Well I think what's-- >> Your company is attacking this Aviatrix. >> What's interesting is, so now you think about from a customer perspective which, I do the same thing, same thing with AWS. It's always outside in. Okay, I'm thinking as a enterprise IT person. I'm making the move. Do you believe that your basic infrastructure will lever the hyperscalers, or will you build an on-prem? Everyone says, "I believe that's the way I'm going to go." Great, how do I do that? So, I'm a IT architect, who do I go to to help me? Do I go to CISCO? No. The most shocking thing for me, of the six months I've been at Aviatrix, is that word's never used. It's like it was DEC or IBM in the conversation, when you were talking about client-server, no, why would you? CISCO, Juniper, Arista, any of the networking people, not even in the conversation. VMware, not really in the conversation. So, I don't have any incumbent vendor that I can go to that I used to go to. >> Why aren't they in the conversation? 'Cause of the commodity, they've been extracted away? >> I think it's just because it's the innovation of dilemma. Right, once you're selling a lot of stuff into on-prem, to then go and say, I mean you look at Palo Alto Networks, they're trying to make that transition. Acquiring a bunch of companies, VMware acquiring a bunch of companies. Why are they doing that? Because they know, I got to get off on-prem, everything's going in the cloud. >> So it's a legacy. >> It's a legacy thing, and I think what happens is, there is only one reason, and one reason only, an enterprise customer is not using Aviatrix. 'Cause they never heard of us. That's why, that's the only reason. Once they hear about what they're doing, my God. >> Well, give the plug, talk about the company, what do you guys do-- >> So we deliver, I mean it sounds like I made it up for this conference, but actually this conference was perfect for this. It's networking and security services for the multicloud enterprise. And we're building an architecture, that people can deploy, that will give them this common architecture across all the different clouds. So whether you're just using one cloud or multiple, it doesn't matter, it's the same set of security and networking services. And we do that by embracing and extending the basic constructs that AWS, Google, Azure, and Oracle, and all the other clouds will give you, and to deliver that real enterprise class. Because the other thing we've found is, everyone thinks that the cloud gives you everything and anything you will ever need from networking and security. Let's say AWS, they're going to do everything I need. What the enterprises are figuring out, is once they stop going in, what they realize is, it's created for the low-level common basic constructs. And the enterprise starts at, well, I need these BGP feature because guess what, the data center is not going away. And I need more than a hundred route limitations, and I need, all of a sudden there's fifty different limitations AWS will give me. Well, they didn't talk about that! Well, of course they're not going to talk about that. They are just going to go check, check, check, we solve all your problems. As enterprises now move in, with mission critical applications, they're realizing, I need the same level of networking and security services that I had on-prem. I can't get that with the native constructs. So where do I go? That's what we do, so we fill in, we embrace what we can of those constructs, we fill in holes where there are fill in holes. And then we give you the mechanism to be able to orchestrate that across the global network. >> So you operationalize the hyperscale clouds for enterprise, >> Yes. >> that's basically what you do. >> Steve: Exactly, for the enterprise. >> Yeah, exactly. >> On the level that they need. >> So you get the benefits of the cloud, but all those nuances under the cover details like networking and other features you abstract that away and provide an operating model for enterprise compliments. >> And the beautiful thing about it is the velocity, at which we can, we're over the top, effectively over the top. We're integrated into the Cloud Suite, understand what cloud native, we understand all the constructs of accounts, and all the things we need to do. But what we expose to the customer, to the enterprise, is a set of over-the-top services that just work. >> Okay Steve, so I got to ask you, since we are at The Multi-Cloud Conference. What is multicloud, I mean how do you define it, you laid out a pretty compelling architecture of what needs are, levers in the cloud, and on-prem is what Aviatrix does. But what is the definition, how should people understand what is multicloud? >> I think for us, for networking and security in that base, so we're basic infrastructure. We get out there first, right? So, if you're going to build a city, you don't start putting people there first the first thing, if you do it right, is you get sewers, you get electricity, gas, roads, all that. Networking and security, infrastructure, is basic infrastructure goes out first. And you want to create an architecture that's going to live with you for twenty years. You don't want to have to rip up the roads and put the sewers in later. And that architecture needs to be multicloud because, even though you think maybe, most of our customers are 90% AWS right now. But every single one of them say, "But I'm moving to Azure, I'm moving to Google, "I've got retail customers that won't allow me "to put my infrastructure on AWS." Or, "I have machine learning, AI type apps on Google." They all say that same thing. But what they all then say to us, is, "You're going to be the mechanism "upon which I'm going to be able to deploy "this common set of services." So they don't need to know that. >> All right, give an example of a customer you guys have, name a name, we had a customer on stage here-- >> Steve: So, Jefferies. >> John: They did this for a use case. >> Yeah so, Jefferies. Financial Services Institution, lots of requirements, Mark Leon Soon is going to be on stage with me tomorrow. We started working with them about nine months ago. Exactly the same thing, they said, "Okay, you know what? "We need to start moving to the cloud, "we've got to start leveraging the cloud. "But, it's too complicated, right? "Even AWS, says 'Go Build.' "I don't want to go build, I want to consume services. "But they don't have all the service that I needed, "they're too low a level. "They're very high function, high enterprise requirements." So they start using us to orchestrate things, to provide transit networking, to provide egress filtering out to the Internet, we have high performance encryption, AWS will only offer it one gig. We can offer it to 10, 20, 30, 40 gig. So they start deploying, they start realizing all the things we do. Then they go and say, "I want to bring my Palo Alto Networks firewall "into the cloud." When you start looking at that, 'cause then guess what? All my policies, I want the same level that I have on-prem when I'm in the cloud. If I go try to bring in my VM series into AWS the construct that AWS give you, they cause you limitations in performance, in visibility, It's integration hassles, there's performance, sustainability, visibility issues, they force you to use SNAT. And there's all these issues, and they go, "Oh my God, this is a pain in the ass." We solved all that for them. We basically cloudify the VM series for them, so all those limitations go away. So that's just another use case that they use. Now they start looking, and they say, "Okay, now I'm going to start extending into other clouds and I want to use you as the common frame point, the common pane of glass. >> Well Steve, good luck in your venture, you're back in the saddle again. >> Steve: Yeah. >> Another ride here, you feel good about it? >> This is going to be the best, the biggest that I've been, and I was at Palo Alto Networks and VMware Nicira. And this one's going to be bigger than both of those. >> What's your vision for where this is going to be for you, where do you see the company in a few years, what are some of the outcomes you expect to happen? >> Our opportunity, and I look at it as, someone's going to take this opportunity, and the reason I came back is, why not us, someone's going to take it. And the opportunity, honestly, is to become, effectively, what Cisco was in the early 90's. To define the architecture, the networking and the security infrastructure architecture for enterprise customers. They are begging for that right now, that's our opportunity. >> Cloud Interoperability. >> Interoperability, yeah. And so there's so many things that we need to go and do. When you look at also the thing that people are going to say, the operations. So many people think, I want it the same as it was on-prem. I think with the cloud, and across multicloud you can do it right with us, and actually better. Because the visibility that you get is more, than what you get on-prem. >> Well, and the thing that's interesting that's different about this new world that we're talking about is that there is going to be constant improvements in new things which means that the functionality game is going to increase, which means the agility is even more important because the apps are going to have more things to do. >> Yeah. I mean in the end, why do you want to go to cloud? I want to go to cloud 'cause I want it to be self-service and I want agility. I want my developers, I want everybody to be able to do things quicker because all of the sudden they say, "Let's go roll this out", and you want to be able to do it. >> Well, good luck on the new venture, Aviatrix, check 'em out, hot multicloud startup, growing, how many people do you have, put the plug in, >> 100. >> what are you guys looking for, are you hiring, give me a quick plug. >> We just hired a new VP at World Wide Sales, James Winebrenner, who was Viptela CEO, VP Sales in Cisco, hiring a tremendous amount of sales guys right now, we're closing on a $40 million Series C round next week, and we're hiring a lot of people. >> Good luck, we'll be following you Steve, thanks for coming on and sharing your insights. Again, multicloud, this is a shift that's happening, multicloud is just another word for multi-vendor, in a new modern era, this is what it has been in the technology industry, but a whole new world. This is theCUBE coverage here in New York City, ESCAPE/19, I'm John Furrier, thanks for watching. (upbeat music)

>> Announcer: Live from Nashville, Tennessee, it's theCUBE, covering Commvault GO 2018. Brought to you by Commvault. >> Welcome back to Nashville, Tennessee, the home this week of Commvault GO with Keith Townsend. I'm Stu Miniman and you're watching theCUBE. Happy to welcome to the program a regular on our program, Patrick Osborne, who's the vice president and general manager of Big Data and secondary storage at Hewlett-Packard Enterprise. Patrick, great to you see. >> Great, thanks for having me. Love to be on theCUBE. Appreciate it. >> Yeah, so we've had you on theCUBE in lots of places, but a first in Nashville 'cause it's the first time we've been here. Keith's second time at the show, my first. What's your impression so far? >> Yeah, so this is our first major presence here at Commvault GO. I think it's going pretty well so far, certainly a great venue. We actually, we do a couple things here for our own presales folks. So first impressions, love the fact that we have a whole conference dedicated to secondary storage, certainly getting a lot of importance lately within customer conversations as well overall investment in the industry, so I'm pretty impressed, pretty lively crowd here. >> Yeah, I really liked, we started off the morning talking to Chris Powell, the CMO of Commvault, talking about how Commvault is a 20-year-old company, and therefore there were certain things that a 20-year-old company has. If you think about their pricing, you think about how people's perception of them are, you work at a company with plenty of history. HPE can partner with whomever they'd like to. >> Yep. >> Stu: Why's it important for HPE to partner with Commvault? >> Yeah, 20 years for Commvault, 78 for HPE, right, so we got a lot of chops there. For us, secondary storage is certainly becoming very important for customers, and it's being driven by new user stories, new capabilities centered around data. So what we look for is, as a technology company, we want to provide an entire solution, vertically oriented, that not only includes our compute networking, storage, secondary storage, cloud, but as well as a very vibrant ecosystem. So we've been working, certainly, with our customers and in the partner ecosystem with Commvault for a number of years, and now we've formalized that and codified it with a couple technology announcements, certainly on the go-to market side, and then some offerings we've done as a service, so backup as a service. >> So let's talk about some of these technology announcements. Talk to us about the significance of the store wants, Commvault integration. Got a great deduplication appliance the store wants, now you're bringing Commvault to the scene, to the solution. What advantage does that bring the customer, first off? >> Yeah, so we have a couple specific integrations we've done. We have our primary all-flash arrays, Nimble and 3PAR, certainly within the Intellus Map umbrella. We've worked with them in the past. We've worked with Commvault recently to deliver some support for our deduplication algorithms. We have our, what we call catalysts. It's the ability to dedupe anywhere, right, within the data center and even outside the data center. So they support that. It really helps out with, certainly, high-speed performance for backup so you can meet those aggressive SLAs. We feel like we've got pretty differentiated technology on the dedupe side, so it helps our customers save in terms of the storage that they have on disk. And then the other big thing is that they've also integrated with Cloudbank, right, so it's our ability to store archived backup data for very, very long periods of time in either Azure or out in Amazon, and essentially using Commvault as the workflow and the catalog, and being able to plug into the ability for us to federate primary, secondary in the cloud is a pretty powerful integration for customers who might already have HPE, might already have Commvault, so it definitely brings a lot of value into that. >> Yeah, Patrick, we've seen a real maturation of that, really, the multi-cloud model in the last couple of years. It seems like that's a foundational piece of the partnership between Commvault and HP. What are you hearing from customers, and what differentiates this solution from others in the market? >> Yeah, so I mean, I think that secondary storage is one that's always rife for having a multi-cloud storage, whether it's people just wanting to do something like I don't want a secondary data center, I want to use the cloud. I want to replace tape. There's a number of different reasons why. I think the differentiation part comes in the technology that I talked about before and making that very seamless for customers and being able to move workloads out to the public cloud for the purposes of long-term data retention. The other key thing is that we're providing this to customers in completely as a service style. So not only from a technology perspective, but the way you consume it now. So we're able to provide primary, secondary, your Commvault solution, the Azure capacity, for example, advisory services, and we're all able to package that up on a per-terabyte or a per-metric basis that customers consume in an elastic manner, like you would the cloud. >> Yeah, HP was one of the first, forgive me if I say legacy, 78-year-old company, people automatically assume companies like AWS and even Azure move that way, but where have you seen customers and their readiness, both from a people standpoint as well as a procurement model for that model, and as I've said, HPE's one of the first ones, the big traditional players, that helped push that model. >> Yeah, so the desire's there. We pitched this every day, ever week, and it's got a lot of legs from a customer interest perspective. We are transacting, and we'll start to build our business and it helps us financially as well, too, right? 'Cause for us to offer those as a service, that's a reoccurring revenue, it's bookings, it's not just your traditional CAPEX hardware acquisition. So it helps us. And a little known fact is that HPE Financial Services, when you talk about an established company, we have a very, very high Net Promoter Score for HPEFS, and that's one of the capabilities that allows us to provide these really, really granular, flexible services for our customers. We've got a lot of things going at HPE. Being a more established, mature company with a very large install base. Not only technology piece, but the financial aspects of it is something we can offer as well. >> Patrick, talk to me about some of the advantages as a service, from an agility perspective. When I think of consuming HPE physical hardware on-prem through HP Financial Services, and I'm consuming this as a service, how does that enable agility for your customers? >> Well, it enables agility in the financial model, number one, so a lot of customers are asking us for as a service, subscription models, moving from CAPEX to OPEX. And not just an OPEX lease, right, 'cause that doesn't count anymore. The rules are changing. So what we're able to do is we provide an actual service. The customer hands over the architecture reins to us, so we have an established methodology of how we implement this, so no snowflakes. We can build on a wealth of experience we have with a number of other customers to be able to essentially deliver a number of outcomes. So it comes very agile in the fact that at the end of the day, secondary storage, some of the user stories are pretty mundane. They're very repeatable, right? And so if you hand that over to us, we're able to help you with that, not only financially but architecturally, and from our operations perspective, and you can focus your talent that you have in your organization on differentiation for your business, right? 'Cause backups, maybe at the end of the day that's not where you're going to hang your hat on your digital transformation as a customer, but it's certainly something you need. So we could both partner together on making that a better experience. >> Stu: All right, go ahead. >> What I was going to ask, what's the interface? How do customers consume these as a service solutions, whether it's the secondary storage or if it's a service living in the cloud? >> Mm, so we have a number of examples of these. So you take a look at a service that we have, for example HPE Cloud Volumes, right? It has a portal, you log in, you can put your credit card in, you can add, let's say, your cloud credentials into that as well, and then you are essentially off and running on dollars per terabyte, and you can scale that up, you can scale that down. So at the end of the day, we're really trying to provide an experience for customers that's very similar to the public cloud. And I think the other area that we've done, we've made some acquisitions in the space, Cloud Technology Partners, RedPixie, Cloud Cruiser, so not only on the being able to use the consumption methodology and the metering that we provide, but also the advisory services, is something that you get from HPE. You actually get to talk to people that know how to do this and have done it before and can help you arbitrate and make you very successful. >> All right, so Patrick, the last 18 to 24 months, the secondary storage space has just been buzzing, almost frothy if you will. >> Yes. >> Commvault's been around for 20 years. Five years ago, there wasn't the excitement in the space. There's the startups, there's companies like Commvault and Veritas and Veen who have established a customer base in there. Why do you see so much excitement there? Is it the new AI of availability? I've got plenty of background in the storage industry, where just data is so critically important that it's right there. What do you see? >> I see it as a massive shift in thinking from TCO to ROI, right? Five years ago, you were having conversation as how can I do this as cheaply as possible, right? It's a non-differentiation life insurance policy at the end of the day. Now it's all about what can I do to maximize the return on that data? And it could be things that are not super sexy, but test verification, sandbox labs, being able to provide copies of data for your developers to get a better experience and a better quality experience for their customers at the end of the day. There's a number of things that we've been able to unlock in the secondary storage area, and some people call it copy data management, hyperconverged for secondary storage, I mean, there's lots of different names and nomenclatures applied to it. But it's essentially, from what I see, people unlocking the value of that data where it used to be captured, siloed, untouchable, but now you've unlocked a number of possibilities for this data, and it's multi-use, right? It's the new currency. >> Yeah, we always argue, at the show, Commvault's saying that data is the new water, but Dave Alante, well water often is a scarce resource and something we all have to fight for. Data, the ability to unlock the data, is we can use it multiple times in lots of different ways, and the more I use the data, the more valuable it is, not like traditional resources. >> Yeah, and also, too, some of the big bats you've seen from HPE, certainly big investment on edge-centric computing as well, too. So our Edgeline, the build out of 5G, certainly the ubiquitous wireless networks that we provide with Aruba. So there's a huge amount of capability of either moving the process outside the data center, but that data's still data. It needs to be protected, you need to be able to use it, so I think we're just getting started in some of these areas, certainly around secondary storage. >> So, let's talk about value that DotNext brings to the mix. We're talking about some pretty advanced use cases, the edge, the data center, the cloud. Stitching this together isn't quite simple. Tell us about the DotNext story and how they helped extend the capability beyond just throwing zeros and ones. >> I think there's a lot of our folks that cover customers, account teams, sales folks that really ensure our customer success, they view this area as very rife for certainly advisory services. I think one of the things is that having the capability of doing this, you guys have seen in the past couple years, people have scaled back dedicated storage admins, right? Dedicated backup admins, unless you're in a very large shop, really don't exist. You've moved towards essentially hypervisor admins, generalist, right? So I think that our capability is we have those services, we have that expertise in-house, and for us to be able to provide very good reference architectures that touch all parts of the stack, because secondary storage is, it's not just selling an all-flash array, or some capacity-optimized disk. It touches everything. It's questions around what's your SLA, what are the apps, what are you trying to do? So for us, we have a wealth of resources and knowledge in this space, and bringing in companies like Cloud Technology Partners and RedPixie into our services organization, that gives us the ability to help customers make that move to hybrid cloud as well, too, which is very important. >> Yeah, Patrick, the other message we're hearing loud and clear from Commvault is the roadmap. There's a lot of automation. There's the intelligence. You talk about all those admins. It was funny, they put up all these roles up on the board in the keynote this morning, and all of them, really, were bots (laughs) underneath. >> Yeah. (laughs) >> Automation can do that. Have us look forward. How does the HPE roadmap and the Commvault roadmap, how much synergy with those visions? >> Yeah, so right now we're definitely running along some parallel lines. They'd probably fire me if I didn't get off-stage here without talking about InfoSight, because it's a huge investment for us. We think it's a huge opportunity. You guys have seen the proof in the pudding from that in terms of automated support, we've got predictive analytics now. So for us, the more that you can build in from an AI and ML perspective, we think the value is in a couple area. Certainly cross stack, so going all the way from the app down through the infrastructure, and we're providing that through InfoSight. And then we're also expanding some of the use cases to include things like secondary storage, right? So if you see, let's say we have a signature that we can see, right? A certain IO pattern, right? We'll make some predictive calls to the infrastructure to say hm, that looks like Ransomware. Maybe you should take a full clone of that and then encrypt it and shove it up in the cloud. Or the change rate on your database just elevated two orders of magnitude. Maybe I should think about moving some workloads that are adjacent to that off that system. So as we expand those and then allow that type of workflow to enable our partners as well, too, you can see where that value would head as well, too, where you start to integrate some of the telemetry from HPE, telemetry from a vendor and ISV partner like Commvault. You could do some really powerful things across the stack. >> All right, last thing for you, Patrick. You're going to be on the keynote tomorrow. Show us a little bit for our audience here what to expect from HPE. >> We talked a little bit about today, we're going to focus our talk tomorrow on some of the new consumption models, as as a service, and we're certainly going to highlight some of the things that we've done so far in AI and ML, certainly making the lives of our storage and data customers a lot easier, and a little bit of a vision as to where we're going with both of those two. >> All right, well Patrick, always a pleasure to catch up with you. Thanks for joining us, and look forward to catching up at the next event. >> Thanks for having me. >> All right, for Keith Townsend, I'm Stu Miniman. We'll be back with more coverage here from Commvault GO here in Nashville, Tennessee. Thanks for watching theCUBE. (upbeat electronic music)

(upbeat techno music) >> Live from Las Vegas, it's theCUBE! Covering VMworld 2018. Brought to you by the VMware and its ecosystem partners. >> Welcome back to theCUBE, here in VMworld 2018. Joining me is my guest host John Troyer, and I am Stu Miniman. And coming to the program, it's hard to believe, for our first time, Jay Krone, who's a senior consultant, Storage Portfolio with Dell EMC. And I say that just to give our audience some context. Jay works for Dell EMC, but we both worked for a company called EMC back in the day. And Jay's has had a number of roles where he's brought lots of people on the program, has known theCUBE since its inception. >> Inception, yeah. >> Yeah,ninth year doing it, and now you've made it. >> Right, I'm finally here. >> All right, so Jay, give our audience a little bit of your background, what you're working on these days. >> So, I'm a longterm storage veteran, as Stu said. I worked for the old EMC back when the only product we had was a scuzzy connected symmetrix and have been though the fiber channel wars. I've been through the SAS wars, the SATA wars, the SSD wars. I'm now working on a couple of cross-portfolio programs. The one we're here to talk about today is the Future-Proof Loyalty Program. >> Yeah, and for the audience that doesn't know what a scuzzy connector is. (Jay laughing) It was this really fat plug that plugged in, It had actual pins-- >> And lots of wires. >> That were designed for-- >> Lots of wires. >> On and off, so those kind of protocols have kind of changed and everything. But when I interviewed at EMC in 2000, it was like, oh, that connection, that I would take two computers and connect them. That was a scuzzy cable. >> Right. >> And it was relatively short-length, so wow. We can go down our memory lane later. But Jay, you're talking about something specific. We talk about the future, and it's tough to predict it. But Dell's going to make sure that everything's future proof, right? >> Of course. >> All right, what's that mean? >> What that means, what's interesting, back in the day we were competing and innovating primarily just in a technology dimension. And a lot of us technologists. We've had fun time doing that. But as people have gotten more sophisticated about the way they buy technology, they're looking for other assurances that vendors are going to be there for them when something goes wrong. So, there are nine different, what we call offers or pillars in the Future-Proof Program that are really intended to give customers peace of mind, probably most importantly, protect their investment, the money that they spend on IT, and to your point, give them a path forward. So, what we've done is looked across the inventory of things that Dell EMC already offered. Many of these were business practices that we already had in place. And what we've done is turned up the volume and made them more, basically, more visible to customers and to our selling forces, and the response has been really good. And the financial ones, of course, are the ones that people, shall we say, gravitate to at the beginning because when they're making a purchase, whether its effectively an extended warranty or a trade-in credit on their old stuff. Think of it, when you go buy a car, you get a trade-in, so you're protecting the investment you made in the car. These are all things that customers are interested in getting and we get from Dell EMC. >> OK, and just in case, people didn't catch that. I think the umbrella for the program is the Dell EMC Future-Proof Loyalty Program? >> Correct! Is that it? OK. >> OK, and one of the things that's important for folks that have been watching, it was started originally as the Future-Proof Storage Loyalty Program because it was generated out of our storage business. And what happened is the customers and sales people were so excited about it, they said, "Can you add more?" And we said, "Yes, we can." And so in July, for example, we added data protection, the IDPA DP4400 product, along with a guarantee specifically tailored for that product. We're here, one of the reasons that I'm here, and we are here at VMware is we added VXRail on Monday. That one's extremely exciting because even before it was officially in the program, we helped a customer with a six-figure purchase through one of the Future-Proof benefits. And then, we have another, we have an eight-figure deal in the wind right now, on VXRail based on some of the pillars of the Future-Proof Program. >> And so, Jay, when you talk about some of the, you're talking about some of the pillars, some of the motivators for the customer then. I mean, some of it's just the transparent financial, some of it's kind of dedupe and storage guarantees. >> Correct. >> All those, you're including all these. >> Correct, correct. And then, yeah, 'cause part of it is to make... Bring Dell and EMC together was complex. >> Gotcha. >> Or created some complexity and some confusion, shall we say. Part of the reason we created this program was to make it simpler to consume and to make some of the things easier to find. >> Yeah, right, right, I mean, much, I mean, like buying a car, right? Enterprise hardware has always been a little bit mysterious. Like, what does cost? Well, how much money do you have? And then I tell you how much it cost. >> Exactly. >> And shady. I mean, not shady, but discounts, and it's not very, it's very opaque. But a lot of these things are real clear, out in the open. Actually, I just went through the website. >> Exactly. >> We guarantee you're going to get this, you can do this. >> Right, right. >> And in three years or five years, we guarantee this, and it's pretty upfront. >> Exactly, and I mean, what you mentioned is the Clear Price Maintenance Program. I mean, again, as we all know, there were some pricing practices with customers that were neither clear nor predictable on maintenance renewals. And so that's been something that's been extremely exciting. That is, in fact, one of the things VXRail folks are excited about, where what ends up happening from a customer perspective is when they get the quote, the quoting system automatically generates your prepaid maintenance price and your renewal price, either three year or five years from now, depending upon the contract you pick, and it's right there on the paper. And I can't get clearer and I can't get more predictable. Here's what you going to pay now, and here is what you going to pay later. >> As a cultural shift, was there any kind of discussion internally about, well, wait a minute, sometimes I hold these, I hold a couple points for a partner. I hold a couple points to make sure I get a deal. Was there a discussion about the changing culture of being so open? >> Well, yes, is the short answer. I'll say it was a culture change. But what's happened is the industry is shift. We don't use scuzzy cables any more, and that maintenance pricing practice has pretty much been voted down by the customer. So, its innovate or die. And so, and part of what I want to say is the innovation is not only in the products. We're doing some innovation on the business side as well. >> Yeah, Jay, I'm curious. We've said on theCUBE many times, the bar the customers will measure everything against is how they do things in the cloud. So, how I consume it, how I think about it. >> Right. >> But one of the challenges with the cloud is sometimes there's uncertainty as to what that bill's going to be next month. >> Right. >> So, maybe you can give us a compare-contrast as of what you've learned. And is there a comparison between this program and what you're talking about? >> Well, so this program is targeted at the infrastructure products. So, it's not so much to compare against the cloud pricing itself; however, what we've done here, also announced this week as part of the larger Dell EMC Cloud Marketplace is what we call the Cloud Consumption Models. And this is a couple of the cloud financing programs. Again, they were already in place from Dell Financial Services. They give customers the ability, if they really want to buy infrastructure that they put in their data centers in an Opex model, you can do that. And it's called Flex on Demand. There's a couple of really exciting high-velocity, they call it Flex on Demand Velocity for Unity and X2 where again, there's a rate card. So you are not coming in and having the sales person sharpen the pencil and say, here's what the price is. So they'll come in with the rate card on how to consume that. And when we take a look at that, that pricing model versus both some of our system vendor competitors, as well as some of your, shall we say, more prominent cloud competitors, as Michael said, the cloud is an operating model, not a place. If you want to have that operating model for the way you pay for the infrastructure, buying an XtremIO capacity from us with the cloud model is cheaper than buying SSD capacity from one of the cloud providers. >> All right, Jay, want to give you the final word. Believe there's a website if people want to find out more. What is the final takeaway you'd want people to have about this program? >> Well, basically, investment protection is number one. Peace of mind is really important. There are a number of guarantees about product performance. And as we've said, the future is bright. We're giving you a way to go there. >> All right, Jay Krone. Pleasure to catch up with you on camera. >> Likewise, thank you. >> As it is always off camera. For John Troyer I am Stu Miniman. Back with more coverage here, theCUBE, VMworld 2018, thanks for watching. (electronic musical flourish)

>> Announcer: Live from Las Vegas, it's theCUBE. Covering AWS re:Invent 2017. Presented by AWS, Intel, and our ecosystem of partners. >> Well we are back live here at the Sands Expo Center. We're of course in Las Vegas live at re:Invent. AWS putting on quite a show here. Day one of three days of coverage you'll be seeing right here on theCUBE. I'm John Walls along with Justin Warren. And we're now joined by a couple folks from Datameer. Justin Rodatus who's the CEO of that company, and Pooja Palan who's the Senior Product Manager. And Christian and Pusha thanks for being with us. Good to have you here on theCUBE. >> Thanks for having us. >> So you were cube-ing at just recently up at New York, Christian. >> Yeah absolutely we were seeing your guys in New York and we had actually, we've done some work with a couple of customers probably two weeks ago in Palo Alto I believe. >> I don't know how we can afford you. I mean I'm gonna have to look into our budget. >> Christian: Happy to be here again. >> Okay no it is great, thank for taking the time here. I know this is a busy week for you all. First off let's talk about Datameer in general just to let the audience at home known in case they're not familiar with what you're doing from a core competency standpoint. And let's talk about what you're doing here. >> Absolutely, I mean Datameer was founded eight years ago and Datameer was only an onset of the big data wave that started in the 2009 and 2010 time frame. And Datameer was actually the first commercial platform that provided a tool set to enable our customers to consume enterprise scale Hadoop solutions for their enterprise analytics. So we do everything from ingesting the data into the data lake or we're preparing the data for a consumption by analytics tools throughout the enterprise. And we just recently also launched our own visualization capabilities for sophisticated analysis against very large data sets. We also are capable of integrating machine learning solutions and preparing data for machine learning throughout the organization. And probably the biggest push is into the cloud. And we've been in the cloud for couple of years now, but we see increased momentum from our customers in the market place for about 15 months now I would say. >> So before we dive a little deeper here I'm just kind of curious about your work in general. It's kind of chicken and the egg right? You're trying to come up with new products to meet customer demand. So are you producing to give them what you think they need or are you producing on what they're telling you that they need? How does that work as far as trying to keep up with-- >> You know I can kick this off. So it's actually interesting that you ask this because the customers that did interviews with you guys two weeks ago were part of our customer advisory council. So we get direct feedback from leading customers that do really sophisticated things with Datameer. They are at the forefront of developing really mind blowing analytical applications for high value use cases throughout their organizations. And they help us understanding where theses trends go. And to give you an example. So I was recently in a meeting with a Chief Data Officer of a large global bank in London. And they have kicked off 32 Hadoop projects throughout the organization. And what he told me is just these projects will lead to an expansion of the physical footprint of the data centers in the UK by 30%. So in (mumbles) we are not in the data center business, we don't want this, we need other people to take care of this. And they've launched a massive initiative with Amazon to bring a big chunk of their enterprise analytics into AWS. >> It sounds like you're actually really ahead of the curve in many ways 'cause of the explosion in machine learning and AI, that data analytics side of things. Yeah we had big data for a little while, but it's really hitting now where people are starting to really show some of the amazing things that you can do with data and analysis. So what are you seeing from these customers? What are some of the things that they're saying, actually this thing here, this is what we really love about Datameer, and this is something that we can do here that we wouldn't be able to do in any other way. >> Shall I take that? So when it comes to heart of the matter, there's like you know three things that Datameer hits on really well. So in terms of our user personas, we look at all of our users, our analysts, and data engineers. So what we provide them with that ease of use, being able to take data from anywhere, and be able to use any multiple analytic capabilities within one tool without having to jump around in all different UI's. So it's like ease of use single interface. The second one that they really like about us is being able to not have to, whatever being able to not have to switch between interfaces to be able to get something done. So if they want to ingest data from different sources, it's one place to go to. If they want to access their data, all of it is in the single file browser. They want to munch their data, prepare data, analyze data, it's all within the same interface. And they don't have to use 10 different tools to be able to do that. It's a very seamless workflow. And the same token, the third thing which comes up is that collaboration. It enables collaboration across different user groups within the same organization. Which means that we are totally enabling the data democratization which all of the self service tools are trying to promote here. Making the IT's job easier. And that's what Datameer enables. So it's kind of like a win-win situation between our users and the IT. And the third thing that I want to talk about, which is the IT, making their lives easier, but at the same time not letting them go off, leaving the leash alone. Enabling governance, and that's a key challenge, which is where Datameer comes in the picture to be able to provide enterprise ready governance to be able to deploy it across the board in the organization. >> Yeah, that's something that AWS is certainly lead in, is that democratization of access to things so that you can as individual developers, or individual users go and make use of some of these cloud resources. And seeing here at the show, and we've been talking about that today, about this is becoming a much more enterprise type issue. So being able to do that, have that self service, but also have some of those enterprise level controls. We're starting to see a lot of focus on that from enterprises who want to use cloud, but they really want to make sure that they do it properly, and they do it securely. So what are some of the things that Datameer is doing that helps customers keep that kind of enterprise level control, but without getting in the way of people being able to just use the cloud services to do what they want to do? So could you give us some examples of that maybe? >> I let Puja comment on the specifics on how we deploy in AWS and other cloud solutions for that matter. But what you see with on premise data lakes, customers are struggling with it. So the stack has become outrageously complicated. So they try to stitch all these various solutions together. The open source community I believe now supports 27 different technology platforms. And then there's dozens over dozens of commercial tools that play into that. And what they want, they actually just want this thing to work. They want to deploy what they used from the enterprise IT. Scalability, security, seamlessness across the platforms, appropriate service level agreements with the end user communities and so on and so forth. So they really struggle to make this happen on premise. The cloud address a lot of these issues and takes a lot of the burden away, and it becomes way more flexible, scalable, and adjustable to whatever they need. And when it comes to the specific deployments and how we do this, and we give them enterprise grade solutions that make sense for them, Puja maybe you can comment on that. >> Sure absolutely, and more specific to cloud I would love to talk about this. So in the recent times one of our very first financial services customers went on cloud, and that pretty much brings us over here being even more excited about it. And trust me, even before elasticity, their number one requirement is security. And as part of security, it's not just like, one two three Amazon takes care of it, it's sorted, we have security as part of Datameer, it's been deployed before it's sorted. It's not enough. So when it comes to security it's security at multiple levels, it's security about data in motion, it's security about data at rest. So encryption across the board. And then specifically right now while we're at the Amazon conference, we're talking about enabling key management services, being able to have server-side encryption that Amazon enables. Being able to support that, and then besides that, there's a lot of other custom requirements specifically around how do you, because it's more of hybrid architecture. They do have applications on-prem, they do have like a deployed cloud infrastructure to do compute in the cloud as it may needed for any kind of worst workloads. So as part of that, when data moves between, within their land to the cloud, within that VPC, that itself, those connectivity has to be secured and they want to make sure that all of those user passwords, all of that authentication is also kind of secure. So we've enabled a bunch of capabilities around that, specifically for customers who are like super keen on having security, taking care of rule number one, even before they go. >> So financial services, I mean you mentioned that and both of you are talking about it. That's a pretty big target market for you right? I mean you've really made it a point of emphasis. Are there concerns, or I get it (mumbles) so we understand how treasured that data can be. But do you provide anything different for them? I mean is the data point is a point as opposed to another business. You just protect the same way? Or do you have unique processes and procedures and treatments in place that give them maybe whatever that additional of oomph of comfort is that they need? >> So that's a good question. So in principle we service a couple of industries that are very demanding. So it's financial services, it's telecommunication and media, it's government agencies, insurance companies. And when you look at the complexities of the stack that I've described. It's very challenging to make security, scalability in these things really happen. You can not inherit security protocols throughout the stack. So you stack a data prep piece together with a BI accelerator with an ingest tool. These things don't make sense. So the big advantage of Datameer is it's an end to end tool. We do everything from ingest, data preparation to enterprise scale analytics, and provide this out of the box in a seamless fashion to our customers. >> It is fascinating how the whole ecosystem has sort of changed in what feels like only a couple of years and how much customers are taking some of these things and putting them together to create some amazing new products and new ways of doing things. So can you give us a bit of an idea of, you were saying earlier that cloud was sort of, it was about two years ago, three years ago. What was it that finally tipped you over and said you know what we gotta do this. We're hearing a lot of talk about people wanting hybrid solutions, wanting to be able to do bursting. What was it really that drove you from the customer perspective to say you know what we have to do this, and we have to go into AWS? >> Did you just catch the entire question? Just repeat the last one. What drove it to the cloud? >> Justin: Yeah, what drove you to the cloud? >> John: What puts you over the top? >> I mean, so this is a very interesting question because Datameer was always innovating ahead of the curve. And this is probably a big piece to the story. And if you look back. I think the first cloud solutions with Microsoft Azure. So first I think we did our own cloud solution, and we moved to Microsoft Azure and this was already maybe two and a half years ago, or even longer. So we were ahead of the curve. Then I would say it was even too early. You saw some adoption, so we have a couple of great customers like JC Penny is already operating in the cloud for us, big retail company, they're actually in AWS. National Instruments works in Microsoft Azure. So there's some good adoption, but now you see this accelerating. And it's related to the complexity of the stack, to the multiple points of failure of on premise solutions to the fact that people want, really they want elasticity. They want flexibility in rolling this out. The primary, interestingly enough, the primary motivators actually not cost. It's really a breathable solution that allows them to spin up clusters, to manage certain workloads that come for a compliance report every quarter. They need another 50 notes, spin them up, run them for a week or two and spin them down again. So it's really the customers are buying elasticity, they're buying elasticity from a technology perspective. They're buying elasticity from a commercial perspective. But they want enterprise grade. >> Yeah we certainly hear customers like that flexibility. >> And I think we are now at a tipping point where customers see that they can actually do this in a highly secure and governed way. So especially our demanding customers. And that it really makes sense from a commercial and elasticity perspective. >> So you were saying that's what they're buying, but they're buying what you're selling. So congratulations on that. Obviously it's working. So good luck, continued success down the road, and thanks for the time here today, we appreciate it. >> Absolutely, thanks for having us. >> John: Always good to have you on theCUBE. >> It's cocktail time, thanks for having us. >> It is five o' clock somewhere, here right now. Back with more live coverage from re:Invent. We'll be back here from Las Vegas live in just a bit. (electronic music)

>> Voiceover: Live from Boston, Massachusetts, it's the Cube, covering Red Hat Summit 2017. Brought to you by Red Hat. >> Welcome back to Red Hat Summit in Boston, everybody. This is theCUBE, the worldwide leader in live tech coverage. Luis Uguina is here, he's the Chief Digital Officer at Macquarie Bank, and he's joined by Rajay Rai, who's the head of digital engineering at the bank. Gentlemen, welcome to theCUBE. Congratulations on the keynote this morning. >> Luis: Thank you. >> Thank you. >> So, really liked the video, actually they show your colleague. Richard Heeley said, "We're digital first." That's your title, digital. Both of your titles. We look at Uber and Amazon, and eBay as the reference model. Most banks, you wouldn't expect that. Where does that come from? >> Luis: Well basically, if you see the banking industry, we have been a full digital business for a long time. So we're not any more moving money, real bank notes >> in Pony Express. >> Rajay: 1s and 0s (laughs). On the Pony Express, but the biggest issue is, with this full digital banking that we have where we're moving 1s and 0s, we have a quite old approach in terms of the culture and how we are doing things. So for us being digital first, means that we have the whole value chain is going to be digital. So from idea to execution we are removing every single thing that is not pure digital. And this starts with the backend systems, and then it's the way we work, the way we empower teams, the way we are doing things now in the bank. >> So, Rajay, we saw today, this morning, one of the videos, using OpenShift to take legacy applications, modernize them. You guys have gone through a similar, not identical, but similar process. Is that correct, and can you describe that. >> Absolutely. I think what's really important to understand is when you start trying to migrate to the cloud, you've got to consider various aspects of application development and packaging your application. So if you have a legacy application, your strategy and your container strategy needs to support... It has to be semi-structured, if you know what I mean. You've got new modern applications that need to be shipped out, and you've got legacy application need to be shipped into a container. And you've got to use the right technology, right strategies, be agnostic to the container. So what you do is take your applications, make them portable across various life cycles and the infrastructures that deploy 'em. >> Rajay, could you explain, what's your relationship with public clouds? How do you think about what applications you put where and it sounds like you've got building in some flexibility into how you're architecting things. >> So what we're doing is... Of course, we decided fundamentally, our objective was no matter what technology we pick, we need to make sure we're cloud agnostic. So you don't want to be picking one cloud provider and putting all your eggs in one basket. You've got to have the flexibility of moving things around, be it hybrid, be it on-prem, be it on the cloud, or picking any provider you want. So having a container technology, provides you the ability to be portable across various cloud environments. >> Luis, what's the conversation like in the corner offices of the bank? And what's your role, input in terms of strategy overall, the impact on the industry, the drivers, just wealth management in general, and other activities of the bank. Maybe you can describe that in strategic terms. >> So the role basically means what I'm doing every single day is basically transforming the way we're doing things. So at the end, we have a clear strategy in terms of how the business needs to behave. But then, how the technology is going to help the business is basically the strategic discussion that we have every single day. So about moving into the cloud, what we're moving into the cloud, if we're moving mission critical applications, or we are just moving other kind of applications, how we empower the teams to be doing things, what is the overall digital strategy that we have in terms of who is going to be doing work, and how we are going to modify, how we're going to upgrade the developer experience. So one of the things that is really important for us, and is key in our digital strategy is, probably one of the best assets that we have in Macquarie that is all the engineers that we have. At the end, when you are delivering a full digital experience to the customer, everything is happening from a engineering point of view. So for us, discussing with the engineers, how is the approach, how we are going to move in different applications, what is going to happen when. So basically is the discussion we have every day. >> And your north star, so to speak, is simple and enriching user experience, and speed is the other thing I heard. >> Luis: Yup, yup, yup. >> And that's really where presumably your team comes in, right? >> Rajay: Absolutely. So you know, the businesses come up with ideas, and it's coming in really fast, so how do you double down on the winners? How do you pick the winners? How do you test and learn? So as an organization, from an engineering perspective, and from a business perspective, what's really important is for an organization to have a platform for execution. And the platform is not something you buy off the shelf. What you need to do is ensure that you have the right technology, people, process, and culture, altogether, to ensure that you have a certain amount of responsible autonomy in picking the technologies and the softwares that you wish to use in order to provide more value to the business. So if you think about software being the most important thing when it comes to creativity today, how do you provide that in the hands of the developers. As Solomon Hykes said this, from Docker, said, the vision of Docker was to provide tools of mass innovation in the hands of a common developer. And that's what we're attempting to do here. Once we do that, it will free up the ability for our organization, or our developers to innovate, and not worry about the complexities that you have with traditional environments. And containers provide you that platform. >> I'm wondering if you can share, organizationally, most companies, it's not like you started with 1000 developers five years ago. What's that migration of engineering talent? How much was retraining? How much was bringing in people that could help you attain this vision? >> Actually, when Luis joined, he set up the Ninjas. What we did was, about 2 1/2 years ago, 3 years ago, we set up the Ninjas, which Luis set up, and that team was, responsibility was to bring value to the business. Not only innovate in isolation, but to have direct... You innovate, and have a direct value to... You know, provide that value. So not have disconnection between an innovation lab and what's really required by the business. So we did that first, brought in the talent, we used... It was a lot of learning curves, so we brought in functional programming, we introduced distributed technologies like Cassandra, Solar, and Spark. We're a huge supporter of open source. At Macquarie Bank, in BFS, Banking and Financial Services, we have lots of meetups. So that way, what happened is, we started supporting the community as such. We host a lot of these meetups. We encourage people to come, and learn. We do the same in our organization, so we started small, and then started making sure that we could take that across the various other business units. >> Luis, I'm curious, from the banking industry in general, do you see a lot of your peers getting involved in the open source thing? I think back to 10 or 15 years ago, it was like, oh well, IT was... Big banks spent a ton of money on IT, they have expertise they want to do, so sharing was a lot of times tough, even though usually, there was behind the scenes, some peers talking, but what do you see happening in the banking industry with IT? >> So what I think is, a lot of things are happening right now and they are changing really, really fast. So obviously, 10 years ago, speaking about the open source, basically with this old days mindset were, I'm not going to put in my system something that I haven't developed, or something that is not from a well-known company that is going to be helping us, just in something happen. But I think the new culture that we have in the banking industry where you need to be faster, and you need to be able to deliver faster services, at higher speed. The only way you can do that is by using open source, and by sharing what you are doing with others. So we have a lot of meetups at Macquarie where we are sharing what we are doing with other banks, and we are happy to be sharing what we are doing, and we're happy just to be understanding what's happening in the market. So what I think is, if we want to be ahead of the pack, the only way is by having a completely different approach in the banking industry. We cannot maintain the old days approach and trying to be the number one in that space. >> Your data strategy has to fit into this. Both of you have digital in your title. That means both of you have essentially, de facto data in your title. What is the relationship to... Do you have a Chief Data Officer, or are you it by de facto standard? >> Luis: We have, yup. >> And what is your data strategy? How is that evolving? >> I think what's happening today in the world is... It's important to understand that data analytics is moving from downstream to upstream. So the technologies you have need to evolve as well. What we believe in is, you need to have two forms of strategies. One is a cold strategy, one is for your hot data strategy. So you have a strategy where you have solutions like Hadoop, and then you have solutions like Cassandra, that's sitting on the edge, closer to the customers, enabling you to have that always-on architecture follow you. If you have to support follow you anywhere applications, you need to have data on the edge, persistent there, cached there, in a distributed manner, and it can provide the data at high speed. So it's all about fast data, which is a combination of streaming data which doesn't fit in memory anymore, having to access large amount of data that's in batch, running small batches on the edge, and combining them and providing the power that you need. So you need hot and cold to come together to provide that power that you need today. >> And are you bringing analytics and transaction workloads together. What role does application development play in terms of being able to speed that up? >> So we use a unique way of doing this, actually. What we've done is, firstly we've got a small set of team that is focused on this, focused on bringing the data alive. So, we call it the smart data store. We're using distributed technologies like Cassandra, we use Spark, and we use Solar. So when you have a conversation, if somebody's calling up a bank, they call a bank because they have a reason to call and ask a question. And for example, you spent your money in a fuel station somewhere, and you've forgotten where, in London for example, you could say, how much did I spend in fuel in London? So that's how a brain thinks, so having that capability is important. So we use full text search, we use a lot of predictive analytics, machine learning, to tag the transactions that we get. So we're doing a lot at the edge. That entire strategy is essentially called Hybrid Transactional/Analytical Processing. I think Gartner calls that HTAP and it's Trans-analytics when it comes to Forrester. So that's a strategy we use in our data at the moment. >> Excellent. So what's next for you guys on the horizon? Again, back to strategy, so you've sort of laid out this vision of simplification and speed, you're working toward that, I think you said 50 applications that you've migrated- >> Luis: Yup, yup. We've migrated already. >> More of that, presumably. What's the next big hurdle? >> So for us, once we have the platform, we now have the basic building blocks that will allow us to do the next jump into the future. So for us, right now, we are working this with all those, that enrichment that Rajay has been speaking about. So we have really good knowledge about what's happening in the bank, and what's happening in the customer's life. The next step, what is going to be a game changer again for the financial industry, we think, is starting to understand the behavior of the customer. And speaking about the behavior of the customer means that as a customer, we deliver one platform, and we deliver quite same capabilities to every single customer. But how the bank is going to behave with every single customer is going to be different. And the system needs to be able to learn from the customer behavior. One example is, a couple of years ago, we send push alerts every time that you are using your card. And what happened is every single morning, when I buy my coffee, I receive the push alert that says, "Hey, you have spent $3.50 on your coffee". What I'm doing is just I'm just swiping my alert. But Rajay is probably doing something different. So what the banks are able to say here is, hey Luis, you're not really interested in this push alert. So the system should be saying, Luis, from now on I'm going to remove this alert from your push alert system. And just in case something strange happen like instead of $3.50, $35, or two transactions in the same second, you're not going to receive that. So the system should be able to learn from my own behavior, and should be able to deliver a completely different experience to every single customer. Right now, we are building the system, and we have the basic building blocks. We're not yet there, but probably will be in six, seven months, there. And where things are, we're going to deliver a completely transformational experience to the customer. >> Great. Alright, gentlemen, we got to leave it there. Thanks so much for coming on theCUBE. Congratulations on the initiative, really great stuff. >> Thank you very much. >> Thank you, thank you. >> Keep it right there, everybody. We'll be back with our next guest. This is theCUBE, we're live from Red Hat Summit in Boston. Right back. (digital music)

>> Announcer: Live from Las Vegas, it's theCUBE. Covering InterConnect 2017. Brought to you by, IBM. >> Hey, welcome back everyone. Live in Las Vegas, the Mandalay Bay. We're at the IBM Interconnect 2017. This is CUBE's exclusive coverage of three days of wall to wall. Day three winding down here at the event. Great show about cloud, data, and blockchain. Our next guest is Marie Wieck, who's the general manager of the Blockchain group within IBM, and Greg Wolfond, who's the chairman and CEO of SecureKey Technologies, announced a partnership with IBM. A lot of great success of blockchain. It's now a business unit in IBM. Marie, great to see you. Congratulations on the new role. >> Absolutely, we're really excited. We've seen so much momentum in blockchain that we really are investing heavily, created a new division, part of our Industry Platforms team, and we're off to the races. >> Exciting. >> So six weeks in the role now. >> Six weeks, I guess the business model is keeping running hard, (laughter) 'cause you guys have made great success. We had Ramesh, one of your workers in your division, on early, he came from the labs, or the research team, >> Marie: Right, research. >> and now he's in Solutions. The traction has been pretty amazing, so take us through, from a business standpoint, obviously you're now got the P&L applet running, you're going, engaging customers on use cases. Where'd this progress come from? Was it just, the internal coalesce of IBMers and customers coming together, give us why this is at its point today. >> I mean I think the most important point about blockchain, is that it really is a network effect. The whole idea of a shared distributed ledger, where everybody has visibility to the appropriate parts of data that they want, gives you some really interesting new business models, but you can't have a network effect, you can't have a community and an ecosystem if you don't have a common set of standards, and a way to drive interoperability. So just 15 months ago, we launched with 30 other people, the Hyperledger Project, in the Linux Foundation. It's been the fastest growing open source project since the Linux Foundation started, so really impressive momentum, and, you know if you think back just a year, at InterConnect last year in February, we had this little demo of trading marbles. This year, fast forward a year, we have a new division, we have 400 clients that we're working with on real production level use cases. We have eight networks in production. We've got now version one of the standard, which really brings a lot of the enterprise requirements, and we're seeing all kinds of new use cases. Supply chain, health care, government, financial services, all where we're really talking about being real now and trusted for business. >> And I would add that Ginni Rometty on stage, hammering home the focus, >> Exactly. >> like big time, at a Watsonesque level, >> Marie: Absolutely. >> so that must to mobilizing the IBMers new division. What's the buzz internally? (laughter) People want to come work for your division now, I mean what's happening? >> I do get an awful lot of emails from a lot of people who are very interested, but I always know when there's real momentum, when there are people who are doing it that we didn't tell to do it, you know, so we're starting with a pretty small team internally, my group itself Direct Line, is about 200 people. There's about 600 people in the extended team across the different functions across IBM, but when I do a search on our internal directory and search for blockchain, there's over a thousand people who have that name already in their title or in their description because they're working on it, and they see the power of it. >> Innovative people get intoxicated by blockchain, because they can just see the disruption elements. Greg, I want to ask you, because you're actually doing it, not only is it intoxicating to kind of grok what blockchain can be, this some real use cases right now, really jamming hard on blockchain with the ledger, can you just share quickly how that's playing out in context IBM and in the marketplace. >> Yeah, so SecureKey's a digital ID company. So we started in Canada years ago doing this login service for government. You show up, you want to see your taxes, your unemployment, your pension, any of 80 different departments, we made it easy for citizens to go there. You can redirect into a federated login with your TD login, or your Royal Bank login. We have millions of Canadians who use that, and we had hundreds of thousands a month, but it's really a login service, and it saved the federal government I think eight hundred million dollars to get that done, but we wanted to move to the next step, which is sharing identity, so digital identity and how do I share my attributes from TD Bank or Royal Bank or my data from Equifax or TransUnion in a trusted way with parties I want to, and not share it in other ways. And we couldn't do that without Hyperledger. So we can talk a little bit about why we went to it, but we have a network in Canada, we tested already phase one, we're launching later this year with Royal Bank, TD Bank, Bank of Montreal, Scotia. Where a citizen can show up at a Telco to create a new account. Is it okay to share my name and address and my credit score? Yes, done, account's open in seconds. FINTRAC changed the rules in Canada so you can open a bank account. Can I show up at a bank and share my attributes from the province and from a credit agency, and create my bank account in seconds. And we've all had this problem, right? I talk to my wife... >> I mean we live it everyday, I mean identity theft is I think front and center in mainstream life. Everyone has either someone close to them or themselves get the phone call, the credit score's dropping, or hey, someone's had my identity for a couple weeks, this is brutal, even the credit cards are gettin'... >> It's funny, when I started this business two of my friends had their identity taken over and someone put mortgages on their homes, and I said there had to be a better way to do it. With blockchain if we can take data from different sources, that the bank knows it's me and I can log in right now, that I possess this phone, that the province knows it's me and I can turn on the camera and check it's me, we can raise the ID validation score for everyone in the whole industry. For healthcare, to government, to banking, and we not only raise the ID validation we also raise the AuthScore, because I'm not just logging in with my bank, I must have this phone, with this SIM in it, and if it's canceled it's not me. And normally people would put that through brokers in the middle, but NIST in the U.S. said, we don't want brokers in the middle. They could peek, they could see your data. I have single points of failure. If this is identity for health here's how it goes down. I have honeypots of data. People are collecting all of my stuff in one place, it's encrypted, but the bad guy's going to get that, right? They could go after the person, and say I need the keys, I have a member of your family... >> I mean we're living in a world, in cloud, Marie knows, there's no perimeter anymore. >> Marie: Right right. The security experts that are state of the art right now, are saying, even saying theCUBE in day one here, data is the new perimeter. So there it is, right, this is fundamental, what you're saying, this is the new perimeter, the data, and you distribute it. >> So no broker right, means less of a threat matrix for people to hack. You don't need a trusted third party to arbitrate. >> You shouldn't have to get other credentials and things to go right, if I can login at my bank right now` and prove I've got the mobile device, can I release data from different sources? Ten percent of Americans move every year, if I show up at an apartment, can I share that I'm Greg and my bank says I'm me, that I have this device from my mobile company, can I share a background check to say that it's me? We're going to do that in about eight seconds, compared to the landlord having to go and pay a real estate agent one month's rent to vet you. And then when you do that, imagine the power now right? Would you like to sign up for internet? Share your data, yes, click. Would you like contents insurance, click. Totally taking friction out for consumers, but making sure that the parties who provide that data, whether it's my bank, whether it's my government, they can't track me. I don't want my government or my bank knowing if I go to mental health, or if I go to a cancer clinic. Really important that they don't know, right? >> Yeah, healthcare here, I don't know what it's like in Canada, but certainly in the United States you can't get information about yourself (laughter). >> And it's a perfect connection to blockchain, 'cause the whole notion of blockchain in our mind is about a trusted network, and how do you get trust if you don't know who the people are who are participating. So, we signed an agreement with the Food and Drug Administration in the United States, to focus on leveraging blockchain for exchange of information around patients, privately and securely for clinical drug trials. You know, it's just one example of now, you bring that trust element, that's built on a blockchain already, as a new interoperable component of these new supply chain networks. Whether it's around supply chain in global sourcing, whether it's the providence of food or diamonds, there's some really interesting aspects that you can now add on top. And we're now even connecting, you mentioned Cognitive, you know, now apply Watson on top of that. How do you increase the trust level in our new version one delivery of Hyperledger on the IBM cloud, we actually provide a trust score for the network, scale, a one to a hundred. What if Watson could actually look at your use case and hear the recommendations and suggestions for how to improve the trust level? Improving it means getting more members, so it's more distributed, and there's more sharing of information. But they're not going to want to share that information if there isn't a trust model. >> So give us a glimpse as to, sort of, your business. You got 200 people, but you've got thousands of people within IBM that you can tap, in addition to the huge portfolio of things like Cognitive. So you've got this startup (laughs), >> Marie: Right. >> inside of IBM. >> Marie: A startup in IBM. >> And you said it's inside the Industry Platform's team, so what is that, and what are you actually building out? >> So, we are building, we're taking, and contributing, we're investing really, in the Hyperledger project ourselves. We are one of now 122 members of the open source and open community project, and we're actually developing and contributing content there. >> Dave: Big committer there. >> Big committer, and we provide a support model for anybody who wants to use just Hyperledger, but we take Hyperledger back, and now we're delivering it as a secure platform on our high security network, that is production grade, you know enterprise strong, would be Ginni's word for that, right, and delivering that on our cloud, or letting you take a container and put it on your own enterprise if you really want your own private cloud. But we're also building industry solutions on top of that. So we announced a partnership with Maersk, for global shipping on global trade digitization to provide greater visibility. >> But on that deal, just to interrupt, that Ramesh was put in, that wasn't a solution specifically for them, that was an industry scope solution. >> Correct. So it's really a partnership. So in this case again, it's that network effect, it's that ecosystem, it's not Maersk, the customer, it's Maersk and IBM the partners, who are now bringing forward as the anchor tenants in this new network, the rest of our ecosystems, and we were interested 'cause we have a big supply chain business for all our hardware as well. >> And you're selling a SAS product, is that right? >> Correct. >> So it's a subscription based model? >> Correct. >> And then services on top of that? >> And services both to develop new blockchain applications, we've had a number of our clients here from the 20 thousand at InterConnect, that've come up with new ideas. We're going to help them build that, in a services kind of model, but many of these are going to be essentially SAS networks where either they're going to pay a membership fee or they're going to pay per transaction, a percentage of the price, or they're going to participate in the savings, because this is actually going to streamline the opportunity. In the case of SecureKey, the model we see customers willing to buy, the validation of an identity for an individual if they're participating in a critical transaction. A bank would certainly be willing to pay to increase the confidence that Greg is Greg, if he was applying for a mortgage online. >> And the consumption is through the IBM cloud, correct? >> Yeah, so there's a toolkit, we're big believers in open source. It's open at the ends, really easy using things like Bluemix to connect to the endpoints. And for us, it's just a magnificent coming together, because things like the high security network to turn banks on quickly, where they trust it, and they can put their data in a secure and trusted way, make this all go faster. >> Dave: But that's the only place in the world I can get this, correct? >> Marie: It is certainly the only place that you can get that level of security in a blockchain network. >> But from a competitive standpoint, somebody else has to build this out, and create as a competitive product as IBM has, and run it on somebody else's cloud, for them to compete, correct? >> That is correct. >> The strategy is not to spam the world's clouds, it's to say hey, we've got this solution, here's how you get it, here's how you consume it. >> And we really firmly believe that if this is an interoperable set of standards, there will be other networks, there will be other participants. We want them all to be interoperable. We want a global identity standard for interlocking networks, because that is actually the tide that raises all boats. So if they want to take Hyperledger and put it on their own private cloud or somebody else's cloud, we support that thoroughly. We think that the most enterprise grade cloud though, is with IBM. >> You just got thousands of people doing it, and you say, go for it. >> Exactly. >> Dave: Bring it on baby! >> First of all, you had me at blockchain beginning the interview. I love blockchain, and I think it's very intoxicating from a disruption standpoint. Any entrepreneur, any innovator... This is a bulldozer on existing business models, and of how people do things. So, I'm sure the organic growth that you guys see is proving it, internal IBM and external. How do people get involved? What's your plans on building the ecosystem now, because you got a tiger by the tail here as the GM of this division now. You got to run hard, you got to embrace people, you got to have events, what's your plan, and how do I get involved if I'm someone watching and we want to get involved? >> So, great simple ways to get involved, the developers, we want 'em to be involved directly through the cloud and through developerWorks. You get free access, you can get started quickly. In three clicks you can have a four peer Hyperledger network up and running on Bluemix, and you can start your own services and create. If you are a customer, what we're really suggesting is come and bring us your use case. Bring the participants in your network as well. Come into one of our IBM garages, and we'll work that out for you. And I think it's important that, we think blockchain has a huge potential or I wouldn't be in this new role, but we also think it's not for everything. It's not the panacea for every business problem. We want to make sure the people are using it in the right way for areas where it really makes the most impact, and then we'll help you implement that and develop it. And then we really see the whole ecosystem around our partners, you're going to onboard people into a blockchain network. You're going to have to integrate with your back ends. You're going to extend your mobile devices to provide these new services through apps. So our GSI community is really helping with the integration and the onboarding. Our ISVs are developing new services that run on those blockchain networks, and we just launched our new IBM Cloud for Financial Services, has a blockchain zone, for all those fintech startups to get access and reuse components, so that we can accelerate the effect. >> Alright, well, congratulations Marie, great to see you in the new role, congratulations, >> Marie: Thank you. >> We're super excited for you, and looking forward to getting the update soon at our new studio. We'll try to rope you into our new Palo Alto studio. Greg, great to hear your success. This is the nirvana, I mean, secure ID is like, the big, I mean easily, not like with some either token or engineered identity system, and this is a home run. >> It's privacy, and it's as we talked about before the broadcast. Facebook, would you trust Facebook to go see your medical records? Would you unlock your title using Facebook? You want things that are private, where people aren't tracking you and are more secure than that, so this is really... >> Don Tapscott called Facebook data fracker. (laughing) We provide all our data for Facebook, they've got billionaires on it. Thanks so much for spending the time. >> Thank you. >> Blockchain revolution here inside theCUBE, bringing you really trusted content here on theCUBE. Distribute it out around the world, I'm John Furrier, Dave Vellante, thanks for watching. More great coverage coming up here, stay with us.