[Music] hi I'm Peter Burroughs welcome to another cube conversation from our beautiful Studios here in palo alto california as we do with every cube conversation we come up with a great topic and we find someone who really understands it so they can talk about it we capture them for you so you can learn something about some of the new trends and changes in the industry and we've doing that today too the topic that we're talking about is how do you do a better job of mapping the costs that are being generated by the cloud or that informations coming out of cloud suppliers related to what you're using with the actual business activities that generate the differential capabilities that customers are looking for that's a tough tough challenge and to understand that better we're talking with junior Stormin who's a co-founder of cloud ability Jaron welcome to the cube thanks Peter good to be here so so let's talk about first who are you yeah so I am co-founder of cloud ability and credibility is focused around improving the unit economics of cloud spend so our customers tend to be those who are spending large amounts in AWS or Azure or GC P and we take their billing data their utilization data various metadata about their business and do machine learning and data science on top of it to help them get better visibility into sort of where that spend is going how they're using it but more importantly to give them some controls around how they want to optimize an optimize doesn't necessarily mean save money in a cloud world because most companies who are moving into cloud very heavily are doing that for the innovation for the speed so they can deliver you know better data faster but it's really about fine-tuning the conversation say okay here we want to save money here we want to move faster here we want to focus on quality and really providing a way for the the various groups that aren't normally talking the finance teams with the engineering teams with the procurement teams all these groups to come together and be able to take executive input to say okay how do we want to operate and how do we one improve those your economics as we go well I want to start with just quick comment on this notion of Union I can when people here historically hear the notion of unit unit economics they think of you know increasing scale so the average cost per unit goes down yeah I think you're talking about more than that right are you really also talking about a mapping of what spend is generating to the business activities that actually generate value and ensuring that you get the differential or the optimized Union economics unit cost yeah oh so the mapping is actually really interesting ly challenging in cloud it's hard enough in traditional IT if you look at somebody like AWS they have two hundred thousand SKUs different products you can buy and they now bill at a second level resolution so what this means is you've got all these engineers out there using cloud in a very good way to move quickly and of 8/2 little more features and they kind of have an unlimited credit card that they can go spend on as quickly as they need and they never see the statements they never see the bills and the other side you've got finance teams procurement teams who've sort of lost control of traditionally the power of the PIO that they have to actually rein that in and they're they're struggling just to understand what is the spend and then to the mapping question how do i allocate these hundreds and millions of charges that i have this month into cost centers and business units and getting that sorted in a world where engineers are focused on moving fast or not they're not tagging things based on cost and are typically so once you get that sort of mapping aspect sorted to the next point you brought as is in bringing the business value so how do we start to relate that back there's a concept a lot of you know IT has been a cost center and now it's sexual driver of value in a world where businesses are increasingly delivering their value through software so we need to start tying the spending mapping into the business and then tying that to the value delivered a great example of this I was sitting last week with one of the largest cloud spenders in the world there have been you know nine figures with their primary vendor and in the conversation with the executives we realized that nobody was looking at both sides of that equation you had the the finance people who were saying hey we're tracking the cost and we think I was happening there and then you had the the revenue generators looking at the money coming anyhow the cloud people with that but there wasn't this centralized view to say alright we want to have a conversation about what value I were getting to spend and the question that always comes up what that is I was doing the right amount well let me build on that because it's seat because IT is historically and this is one of the things that we've been doing over the last few years IT has historically done things on a project level yes all right so we had waterfall development we tried to change that with agile we had you know buy the hardware upfront and then deploy the application on a cloud changes that so this project orientation has led to a set of decisions about finance at the moment that the business asides to do it we've changed the practices that we use at a development level we've changed the practices that we use at an asset level is it now time to change the practices that we use at a finance level is that really kind of what's going on here it is that the project analogy is good because what we're seeing is they're shifting from a project basis to a productive basis and products that deliver value increasingly if you think about the change that's happened with DevOps it in the scene and cloud companies are delivering more of their value through software and they're not just using IT for internal projects right it's actually the driver of business how we interact with Airlines and banks and all these things so that's the shift to say okay now we've gotten good at DevOps moving fast and we've gotten good at deploying and building better data stores now we need to bring in this new discipline and the discipline is what the market is calling fin ops which essentially is combining financial financial operations but you simply combine technology applied specifically do a cloud roll and it only can really happen in cloud it can't happen in data centers because data centers have fixed spending right you have to wait to get resources once you make the investment it's a sunk cost there's months of lead time cloud introduced the removal of constraints which means you can get whatever you want as quickly as you want and DevOps meant it's all automated so instead of your collection of 60 servers you've got thousands that are coming up and down all the time so what you don't have to do is bring in all these groups engineers have to think about cost as a new efficiency metric they have to think about the impact of their business at this code this confirmation template they just wrote is going to have and the finance teams have to shift from this mode of I'm under report retro actively and at a quarterly granularity sixty days after it happened and block investment to be I'm going to partner with these teams report in a real-time fashion give them the visibility help forecast and actually bring them together to make better business decisions about the cloud spend so cloud has allowed development to alter practically agile has been around for a long time before the cloud predates the cloud but it became practical and almost demanded as a consequence of what you could do with cloud so cloud change development through agile it changed infrastructure management through DevOps where now you're you're deploying software infrastructure of code and know as code and what you're saying is the third leg of that stool cloud is now changing how you do financial management of technology financial management of IT and we're calling that fin ops yeah and you you you can't really have fin ops without cloud or without DevOps and if you have the two together you alter we need this new set of it's a new operating model the reason this has come to a head of late is you know if you look at going to the Amazon riemeck conferences a few years back it was like well how much is cloud gonna be a thing and okay clouds now gonna be a thing when's it gonna happen now it's about the how and how do we do this better cloud is hitting for the material spend levels now at bigger organizations I mean the you know see the the cloud projections where it's going I think it's now 360 billion the next few years and we're seeing CFO's at public companies look to say okay it's not my biggest line-item yet but it's the most variable and fastest growing cogs expense so it's actually start to affect our margins we needed a new set of process used to actually manage this so one of the things that's coming to market is this new group called the phenoms Foundation which is a non-profit trade association that initially has a few dozen of some of the largest cloudspinners of the world there's the Spotify as the alaskans the nation why it's Autodesk's and they've all come together as a set of best practice practitioners to start to codify this into something that can be you know scaled out in organizations so that group is gonna be putting out a user conference around this area there's a new o'reilly book that's coming out the end of the year that's going to be sort of the treatise and all this stuff pulled together because what we found in you know me is in code ability in the last eight years we bring in technology and platform to show the recommendations of visibility how to do this but the real challenge companies run into is they don't have the internal expertise their finance teams understand what they need to the engineers don't and so you know they came to us last year saying can you help figure out the processes can you educate us and that's really where you know the spin offs foundation is growing bringing together those people to define those processes so the the impact of cloud on each of these different groups on the development group on the infrastructure team and now on the finance team the interest the developer groups I think some of them resisted it but generally speaking it's gone okay and and eventually tooling from a variety different players came along that made it easy to enact best practices and software development through an agile mechanism in the last few years after significant battles within infrastructure teams about whether or not they were going to use software as code we've seen new products new tooling that has facilitated the adoption of those practices what kind of tooling are we going to see introduced that facilitates thin ops so that finance teams procurement teams move from a project orientation to a strategic management of the resource orientation I mean I think the first is on the engineering side is seeing costs become a first-class citizen of an efficiency metric that they need to look at so you know in their build processes baked in the CI CD looking to see am I properly sizing my compute request for the workload that it needs there's some research research just came out showing that I think it's like 80 percent of the market is not using the best discounting options the cloud providers offer you hear these horror stories it's too expensive we said overspend that's not actually a problem with the cloud providers that's a problem with the enterprises not using the tools offered the discounts the reserved ences the infrequent access door exactly so I think at the end of the day it's the first step in this is getting those checks in place to say are we using the things that help drive the right cost for our needs and the other side of that the finance team is really changing the way that they are interacting with their technology teams becoming partners becoming advocates in this versus a passive you know retroactive reporter down the line and this enables these sort of micro optimization discussions that can happen where data center world we bought it some cots is sitting there odd world we can make decisions today that impact you know the business tomorrow so let me make sure I got this so I have a client who who I was having a conversation with them they told me that their their Amazon there AWS bill is 87 gigabytes mm-hmm not that monthly that's 87 pages that's 87 gigabyte yeah so we get we bring this 87 gigabytes in and it's a story about what I consume out of Amazon it's not a story what my business utilizes to achieve its objectives so we're now entering into a world where we're trying to introduce those financial visit that financial visibility into how that spend can be mapped to what the business does so the finance group can look at a common notion of truth and the IT group can look at a combination of troop application owners can look at a common notion of truth and that's what is fin ops is providing if I got that right yeah absolutely and the eighty-seven gigabyte example is the exactly reason why it is fin option not just cloud financial management you can't have a person with a spreadsheet looking at that and trying to make decisions about it right it has to be automated its IT finances code it's got to be baked into the processes you know we we've seen organizations that have hundreds of millions of individual charges hitting them in a consumption based manner the other thing that's come in with the fin ops as a core tenant is we're now seeing a decentralization of accountability for that spend so if you look at the big cloud spenders out there maybe spending tens or hundreds mils a year some of them have thousands of cloud environments gone is the day of we have a centralized Group begins to say we're gonna turn this off turn this off we want to give each of those teams the ability to see there's just their portion of that bill in the right mapped way as you said and to be able to take actions on the back of that so that's changed and they you know you run it you maintain it you understand which shutdown what has sort of come back to the old centralized model is this notion and this is where procurements job is shifted to largely of we deal still want to centralize the rate reduction so engineers you go use less right essentially finance team procurement work together with the cloud vendors to get the best possible rates through reserved instances can be reduced discounts you know volume discounts negotiated rates whatever it is and they become sort of strategic sourcing just say you're gonna use whatever you're going to use and you're gonna watch that to make sure you're using the right amount will targets threshold we're gonna make sure we get the best rate and that's sort of the two sides of the coin well very importantly procurement has always been organized on episodic purchases where the whole point is to bring the price point down and now we're talking about a continuous services where you were literally you're literally basing your business on capabilities provided by a third party and that is a very very very different relation just-in-time purchasing right and it's and it's a new supply chain management process where you have so many SKU options and you are making these purchase decisions sometimes thousands a day and that impacts everything down the road excellent gr storm and co-founder of cloud ability talking about Finn ops and cloud abilities role in helping businesses map the cloud spend to their business activities for a better more optimal views of how they get what they need out of their cloud expenditures Jr thanks very much for being on the connects here and once again I'm Peter burrows and thanks for listening to this acute conversation until next time [Music] you

(bright music) >> Hi, I'm Peter Burris. Welcome to another CUBE Conversation from our beautiful studios here in Palo Alto, California. As we do with every CUBE Conversation, we come up with a great topic and we find someone who really understands it so they can talk about it. We capture them for you so you can learn something about some of the new trends and changes in the industry, and we're doing that today too. The topic that we're talking about is, how do you do a better job of mapping the costs that are being generated by the cloud. Well that information's coming out of cloud suppliers related to what you're using with the actual business activities that generate the differential capabilities that customers are looking for. That's a tough, tough challenge, and to understand that better, we're talking with J.R. Storment, who's a co-founder of Cloudability. J.R, welcome to the CUBE. >> Thanks Peter, good to be here. >> So let's talk about... First, who are you? >> Yeah, so I'm co-founder of Cloudability, and Cloudability is focused around improving the unit economics of cloud spend, so our customers tend to be those who are spending large amount in AWS or Azure or GCP. And we take their billing data, their utilization data, various meta data about their business and do machine learning and data science on top of it to help them get better visibility into where that spend is going, how their using it, but more importantly to give them some controls around how they want to optimize. And optimize doesn't necessarily mean save money in a cloud world. Cause most companies who are moving into cloud very heavily are doing that for the innovation, for the speed, so they can deliver better data faster. But it's really about fine-tuning the conversation. Say, "Okay, here we want to save money. "Here we want to move faster. "Here we want to focus on quality." And really providing a way for the various groups that aren't normally talking, the finance teams with the engineering teams with the procurement teams, all these groups to come together, and be able to take executive input to say, "Okay, how do we want to operate? "And how do we want to improve those unit economics as we go?" >> Well, I want to start with just a quick comment on this notion of unit economics. Cause when people historically hear the notion of unit economics, they think of increasing scale so the average cost per unit goes down. But I think you're talking about more than that, right? Aren't you really also talking about a mapping of what spend is generating to the business activities that actually generate value and ensuring that you get the differential or the optimized unit economics or unit cost? >> Yeah, so the mapping is actually really interestingly challenging in cloud. It's hard enough in traditional IT. If you look at somebody like AWS, they have 200,000 SKUs, different products you can buy. And they now bill at a second level resolution. So what this means is you've got all these engineers out there using cloud in a very good way to move quickly, innovate, include more features. And they kind of have an unlimited credit card that they can go spend on as quickly as they need. And they never see the statements. They never see the bills. And the other side, you've got finance teams, procurement teams who've sort of lost control of traditionally the power of the PO that they have to rein that in. And they're struggling just to understand what is the spend. And then to the mapping question, how do I allocate these hundreds of millions of charges that I have this month into cost centers and business units, and getting that sorted in a world where engineers are focused on moving fast. They're not tagging things based on cost center typically. So once you get that sort of mapping aspect sorted to the next point you brought is is then bring in the business value. So how do we start to relate that back. There's a concept a lot of you know, IT has been a cost center, and now it's actual driver of value in a world where businesses are increasingly delivering their value through software. So we need to start tying the spending, mapping of the business and then tying that to the value delivered. A great example of this, I was sitting last week with one of the largest cloud spenders in the world. And they're up in, you know, nine figures with their primary vendor. And in the conversation with the executives, we realized that nobody was looking at both side of that equation. You had the finance people who were saying, "Hey, we're tracking the costs, "and we're figuring out what's happening there." And then you have the revenue generators looking at the money coming in, you know the cloud people with that. But there wasn't this centralized view to say, "Alright, we want to have a conversation about what value are we getting out of this spend." And the question that always comes up with that is are we spending the right amount? I don't know. >> Let me build on that, because IT is historically, and this is one of the things that we've been doing over the last few years, IT has historically done things at a project level. Alright, so we had waterfall development. We tried to change that with Agile. We had buy the hardware upfront and then deploy the application on it, cloud changes that. So this project orientation has led to a set of decisions about finance at the moment that the business decides to do it. We've changed the practices that we use at a development level. We've changed the practices that we use at an asset level. Is it now time to change the practices that we use at a finance level? Is that really kind of what's going on here? >> It is, the project analogy is good. Because what we're seeing is they're shifting from a project basis to a product basis, and products that deliver value. Increasingly if you think about the change that's happened with DevOps in the scene and cloud, companies are delivering more of their value through software, and they're not just using IT for internal projects, right. It's actually the driver of business. It's how we interact with airlines and banks and all these things. So that's the shift to say, okay, now we gotten good at DevOps moving fast, and we've gotten good at deploying and building better data stores. Now we need to bring in this new discipline. And the discipline is what the market is calling FinOps, which essentially combining financial operations. You're essentially combining-- >> Applied to a technology world. >> Applied specifically to a cloud world. And it can only really happen in cloud. It can't happen in data centers. Because data centers have fixed spending, right? You have to wait to get resources. Once you make the investment, it's a sum cost. There's months of lead time. Cloud introduced the removal of constraints, which means you can get whatever you want as quickly as you want. And DevOps meant it's all automated. So instead of your collection of 60 servers, you've got thousands that are coming up and down all the time. So what you now have to do is bring in all these groups. Engineers have to think about cost as a new efficiency metric. They have to think about the impact on their business that this code, this confirmation template they just wrote is going to have. And the finance teams have to shift from this mode of "I'm going to report retroactively at a quarterly granularity, "60 days after it happened and block investment" to be "I'm going to partner with these teams. "Report in a real-time fashion. "Give them the visibility and help forecast. "Actually bring them together and make better business decisions about the cloud spend." >> So cloud has allowed development to alter practically, I mean Agile has been around for a long time, pre-dates the cloud, but it became practical and almost demanded as a consequence of what you could do with cloud. So cloud changed development through Agile. It changed infrastructure management through DevOps. Where now you're deploying software infrastructure as code. And what you're saying is the third leg of that stool, cloud is now changing how you do financial management of technology, financial management of IT. And we're calling that FinOps. >> You can't really have FinOps without cloud or without DevOps, and if you have the two together, you ultimately need this new set of, it's a new operating model. The reason this has sort of come to a head of late is if you look at going to the Amazon re:Invent conferences a few years back, it was like well how much is cloud going to be a thing. And okay, cloud's not going to be a thing. When's it going to happen? Now it's about the how and how do we do this better. Cloud is hitting sort of material spend levels now at big organizations. You always see the cloud projections where it's going, I think it's now 360 billion in the next few years. And we're seeing CFOs at public companies look to say, "Okay, it's not my biggest line item yet. "But it's the most variable and fastest growing "cogs expense, so it's actually "starting to affect our margins. "We need a new set of processes to actually manage this." So one of the things that's coming to market is this new group called the FinOps Foundation, which is a non-profit trade association that initially has a few dozen of some of the largest cloud spenders in the world. There's the Spotifys, the Laciens, the Nationwides, the Autodesks. And they've all come together as a set of best practice practitioners to start to clarify this into something that can be scaled out in organizations. So that group is going to be putting out a user conference around this area. There's a new O'Reilly book that's coming out the end of the year that's going to be sort of the treatise and all this stuff pulled together. Because what we found and you know me, as in Cloudability in the last eight years, we bring in technology and platform to show the recommendations of visibility and how to do this, but the real challenge companies run into is they don't have the internal expertise. Their finance teams understand what they need to. The engineers don't. And so they came to us last year saying, "Can you help figure out the processes? "Can you educate us?" And that's really where this FinOps Foundation has grown out of, of bringing together those people to define those processes. >> So the impact of cloud on each of these different groups, the development group, on the infrastructure team, and now on the finance team. The developer groups, some of them resisted it. But generally speaking, it's gone okay. And eventually tooling from a variety of different players came along that made it easy to enact best practices in software development through an Agile mechanism. In the last few years after significant battles within infrastructure teams about whether or not they were going to use software as code. We've seen new products, new tooling that has facilitate the adoption of those practices. What kind of tooling are we going to see introduced that facilitates FinOps, so that finance teams, procurement teams move from a project orientation to a strategic management of a resource orientation? >> I mean I think the first is on the engineering side is seeing cost become a first class citizen of an efficiency metric that they need to look at. So you know in their build processes baked in the CICD, looking to see am I properly sizing my compute request for the workload that it needs. There's some research that just came out showing that, I think it's 80% of the market is not using the best discounting options that cloud providers offer. You hear these horror stories. Cloud's too expensive, we overspend. That's not actually a problem with the cloud provider. That's a problem with the enterprises not using the tools that offer the discounts, the reservances, the infrequent access. >> Caveat emptor. >> Exactly, so I think at the end of the day, the first step in this is getting those checks in place to say, "Are we using the things that help drive the right cost for our needs?" And on the other side of that, the finance teams really changing the way that they are interacting with the technology teams. Becoming partners, becoming advocates in this versus a passive, retroactive reporter down the line. And this enables these sort of micro-optimization discussions that can happen where data center world, we bought it at some cost, it's sitting there, cloud world, we can make decisions today that impact the business tomorrow. >> So let me make sure I got this. So I have a client who I was having a conversation with him. They told me that their Amazon, their AWS bill, is 87 gigabytes monthly. Not some 87 pages. That's 87 gigabytes. So we bring this 87 gigabytes in, and it's a story about what I consume out of Amazon. It's not a story of what my business utilizes to achieve its objectives. So we're now entering into a world where we're trying to introduce that financial visibility into how that spend can be mapped to what the business does. So the finance group can look at a common notion of truth. And the IT group can look at a common notion of truth. Application owners can looks at a common notion of truth. And that's what FinOps is providing. Have I got that right? >> Absolutely, and the 87 gigabytes example is the exact reason why it is FinOps, and not just cloud financial management. You can't have a person with a spreadsheet looking at data and trying to make decisions about it, right? It has to be automated. It's IT finances code. It's got to be baked into the processes. We've seen organizations that have hundreds of millions of individual charges hitting them in a consumption based manner. The other thing that's come in with the FinOps as a core tenet is we're now seeing a decentralization of accountability for that spend. So if you look at the big cloud spenders out there who are maybe spending tens or hundreds of millions a year, some of them have thousands of cloud environments. Gone is the day of we have a centralized group getting to say, "We're going to turn this off, turn this off." We want to give each of those teams the ability to see just their portion of that bill in the right mapped way, as you said, and to be able to take actions on the back of that. So that's changed in the you know, you run it, you maintain it, you understand what's shut down. What has sort of come back to the old centralized model is this notion, and this is where procurement's job has shifted to largely, of we do still want to centralize the rate reduction. So engineers, you go use less, right? Essentially, finance teams, procurement work together with the cloud vendors to get the best possible rates through reserved instances, can be deduced discounts, you know volume discounts, negotiated rates, whatever it is. And they become sort of strategic sourcing. To say you're going to use whatever you're going to use, and you're going to watch that to make sure you're using the right amount with target thresholds. We're going to make sure we get the best rate for it. And that's sort of the two sides of the coin. >> Well, very important, procurement has always been organized on episodic purchases, where the whole point is to bring the price point down. And now we're talking about a continuous service, where you are literally basing your business on capabilities provided by a third party. And that is a very, very, very different relationship. >> It's just in time purchasing. And it's a new supply-chain management process, where you have so many SKU options, and you are making these purchase decisions, sometimes thousands a day, and that impacts everything down the road. >> Excellent. J.R. Storment, co-founder of Cloudability, talking about FinOps and Cloudability's role in helping businesses map their cloud spend to their business activities for better, more optimal views of how they get what they need out of their cloud expenditures. J.R., thank you very much for being on the CUBE. >> Thanks, Peter. >> And once again, I'm Peter Burris. And thanks for listening to this CUBE Conversation. Until next time.

>> Announcer: Live from the Moscone Center, it's The Cube covering AWS Summit San Francisco 2018. Brought to you by Amazon Web Services. >> Welcome back to our exclusive Cube coverage here at AWS, Amazon Web Services Summit 2018 in San Francisco. I'm John Furrier with my cohost, Stu Miniman. We have a special guest. We have an influencer, authority figure on AWS, Corey Quinn, editor of Last Week in AWS, also has got a podcast called Screaming, >> Corey: In the Cloud. >> Screaminginthecloud.com just launched. Corey, great to have you on. Thanks for joining us. >> No, thank you for letting me indulge my ongoing love affair with the sound of my own voice. (laughing) >> Well we love to have you on and again, love the commentary on the keynote on Twitter. Lot of action, we were in the front row, kind of getting all the scene. Okay, if you're going to write the newsletter next week for what happened this week, if this week was last week, next week, what's your take on this? Because again, Amazon keeps pounding the freight train that's just the cadence of AWF announcements. But they're laying it out clear. They're putting up the numbers. They're putting out the architecture. They're putting out machine learning. It's more than developers right now. What's your analysis, what's your take of what's happening this week? >> I think that certain trends are continuing to evolve that we've seen before where it used to be that if you're picking an entire technology that you're going to bet your business on, what you're going to build on next. It used to be which vendor do I pick, which software do I pick? Now even staying purely within the AWS ecosystem, that question still continues to grow. Oh so I want to use a database, great. I have 12 of them that I can choose between. And whatever I pick, the consensus is unanimous, I'm wrong. So there needs to be, I still think there needs to be some thoughtful analysis done as far as are these services solving different problems. If so, what are the differentiating points? Right now, I think the consensus emerges that when you look into a product or service offering from AWS, the first reaction all of us feel is to some extent confusion. I'm lost, I'm scared. I don't really know what's going on. And whatever I'm about to do, I feel like I'm about to do it badly. >> Yes, scale is the big point. I want to get your reaction. Matt Wood, Dr. Matt Wood, Cube alum, been on many times, he nailed it I thought when he said, look it, machine learning and data analysis was on megabytes and gigabytes, they're offering petaflop level compute, high performance, and then Werner Vogels has also said something around the services where, you can open things up in parallel scale. So, what's your reaction to that, as you look at that and say whoa, I've got a set of services I can launch in parallel, and the scale of leveraging that petaflops. I mean, this is kind of like the new, you know, compute model. Your reaction is it real? Are customers ready for it? Where are we in that evolutionary customer journey? Are they still cavemen trying to figure out how to make fire and make the wheel? I mean where are we with this? >> I think that we see the same thing continuing to emerge as far as patterns go, where they talk about, yes there's this service. Just start using it and it scales forever. And that's great in theory, but in practice, all of the demos, all of the quick starts, all of the examples, paint by numbers examples that they'll give you, tend to be at very small scale. And yes, it works really well when you have effectively five instances all playing together. When you have 5,000 of those instances, a lot of sharp edges start to emerge. Scale becomes a problem. Fail overs take far longer. And let's not even talk about what the bill does at that point. Additionally once you're at that point, it's very difficult to change course. If I write a silly blog, and effectively baby seals get more hits than this thing does, it's not that difficult for me to migrate that. Whereas if I'm dealing with large scale production traffic that's earning me money on a permanent basis, moving that is no longer trivial or in some cases feasible at all. >> Yeah Corey, how does anybody reasonably make a decision as to how they're going to build something because tomorrow, everything might change. You said oh okay great, I had my environment and I kind of you know, built my architecture a certain way, oh wait there's a new container service. Oh, and start building a, oh wait now there's the orchestrated version of that that I need to change to. Oh wait, now there's a serverless built way that kind of does it in a similar way. So you know, it seems like it used to be the best time to do things would've been two months ago, but now I should do it now. Now the answer is, the best time for me to do things would be if I could wait another quarter, but really I have to get started now. >> I tend to put as much on future Corey as I possibly can. The problem is that at one time I could've sat here and said the same thing to you about, oh virtualization is the way to go. You should migrate your existing bare metal servers there. And then from virtualization to Cloud and Cloud to containers. Then containers to serverless. And this narrative doesn't ever change. It's oh what you're doing is terrible and broken. The lords of thought have decried that now it's time to do this differently, and that's great, but what's the business use case for doing it? Well, we did this thing that effectively people get on stage at keynotes and make fun of us for now, so we should really change it. Okay maybe, but why? Is there a business value driving that decision? And I think that gets lost in the weeds of the new shiny conference ware that gets trotted out. >> Well I mean Amazon's not, I mean they're being pretty forthright. I mean, you can't deny what Intuit put out there today. The Intuit head of machine learning and data science laid out old way, new way. Classic case of old way, new way. Eight months, six to eight months, ton of cluster, you-know-what going on as things changed it. They're just data scientists. They're not back-end developers. They went to one week. Nine months to one week. That's undeniable right? I mean how do you, I mean that's a big company but, that seems to be the big enchilada that Amazon's going for, not the pockets of digital disruption. You know what I'm saying? So it's like, how do you square that out? I mean how do you think about that? >> Cloudability had a great survey that they released the results of somewhat recently where they were discussing that something like four or five of the, or I'm sorry 85% of the global spend on AWS went to four or five services that all have been around for a long time. RDS, EC2, S3, PBS, Data Transfer. And so as much as people talk about this and you're seeing pockets of this, it's not the common gaze by a wide margin. People don't get up on stage and talk about, well I have these bunch of EC2 instances behind a low balancer, storing data on S3 and that's good enough for me, because that's not interesting anymore. People know how to do that. Instead, they're talking about these far future things that definitely add capability, but do come at a cost-- >> I mean it's the classic head room. It's like here's some head room, but at the end of the day it's EC2, S3, Kinesis, Redshift, bunch of services that's U.S that seem to dominate. The question I want to ask you is that they always flaunt out the, every year it changes, Kinesis was at one point the fastest growing service in the history of AWS. Now it's Aurora. We made a, I made a prediction on the opening that a SageMaker will be the fastest growing service, because there just seemed to be so much interest in turn-key machine learning. It's hard as you-know-what to do it. >> I agree. >> Your thoughts on SageMaker? >> In one of my issues a few weeks back, I wound up asking, so who's using SageMaker and for what? And the response was ridiculous. What astounded me was that no two answers were alike as far as what the use case was. But they all started the same way. I'm not a data scientist, but. So this is something that's becoming-- >> John: What does that mean to you? What does that tell you? >> It tells me that everyone thinks they're unqualified to be playing around in the data science world, but they're still seeing results. >> But Corey I wonder because you know, think back a few years ago. That's what part of the promise of big data, is we have all this data and we're going to be able to have the business analysts rather than you know, some PhD sort this out. And machine learning is more right. We want to have these tools and we want to democratize data, you know. Data is the new bacon. It's the new oil. Data's the new everything. So you know, machine learning, you think this is all vapor and promise, or do you think it's real? >> I think big data is very real and very important. Ask anyone who sells storage by the gigabyte. And they will agree with me. In practice I think it's one of those areas where the allure is fascinating but the implementation is challenging. Okay we have history going back 20 years of every purchase someone has ever made in our book store. That's great, why do I still wind up getting recommendations? >> Well yeah and I guess, I want to talk that it was the, I see it more as, everything that was big data is now kind of moving to the ML and AI stage. Because big data didn't deliver on it, will this new wave deliver on the promise of really extracting value from my data? And it's things like this, live data. It's doing things now with my data, not the historical, lots of different types of data that we were trying to do with like the Hadoops of the world. >> Got ya. I think it's a great move because either yes it will or no it won't, but if it doesn't, you're going to see emergent behaviors of so why didn't it work? Well we don't understand the model that this system has constructed, so we can't even tell you why it's replacing the character I with some weird character that's unprintable, so let alone why we decide to target a segment of customers who never buys anything. So it does become defensible from that perspective. Whether there's something serious there that's going to wind up driving a revolution in the world of technology, I think it's too soon to say and I wouldn't dare to predict. But I will be sarcastic about it either way. >> Okay well let's get sarcastic for a second. I wan to talk to you about some moves other people are making. We'll get to the competition in a minute but Salesforce required MuleSoft. That got a lot of news and we were speculating on our studio session this week or last week with the CEO of Rubric that it's great for Salesforce. It can bring structured data in, on PRIM and the Cloud. Salesforce is one big SaaS platform. Amazon is trying to SaaS-ify business through the Cloud. So, but one of the things that's missing from MuleSoft is the unstructured data. So the question for you is, how are you seeing and how is your community looking at the role of the data as a strategic asset in a modern stack, one, both structured and unstructured data, is that becoming, even happening or is it more like, well we don't even know what it means. Your thoughts? >> I think that there's been a long history of people having data in a variety of formats and being able to work with that does require some structure. That's why we're seeing things emerging around S3's, increasing capabilities, being able to manipulate data at rest. We're seeing that with S3 and Glacier Select. We're seeing it with Athena which is named after the goddess of spending money on Cloud services, and there's a number of different tooling options that are, okay we're not going to move three x-abytes of data in so we have to do something with where it is. As far as doing any form of analysis on it, there needs to be some structure to it in order for that to make sense. From that perspective, MuleSoft was a brilliant acquisition. The question is, is what is SalesForce going to do with that? They have a history of acquisition, some of which have gone extremely well. Others of which we prefer not to talk about in polite company. >> It comes back down to the IDE thing. How many IDE's does Salesforce have now? I mean it's a huge number. >> I'm sure there's three more since we've started talking. (laughing) >> Yeah so Corey, you brought up, you know, money. So you know, the trillion dollar, what feedback are you getting from the community? You know there's always, well I get on Amazon and then my bills continue to grow and continue to grow. Same thing at Salesforce by the way if you use them. So you know, there's always as you gain power, people will push back against it. We saw with with Mike Hichwa with Oracle. I hear it some but it's not an overriding thing from when I talk to customers about Amazon. But I'm curious what you're hearing. Where are the customers feeling they're getting squeezed? Where is it you know, phenomenal? What are you seeing kind of on the monetary side of Cloud? >> In my day job, I solve one problem. I fix the horrifying AWS bill, both in terms of dollars and cents as well as analysis and allocation. And what astonishes me, and I'm still not sure how they did it. It's that AWS has somehow put the onus onto the customer. If you or I go out and we buy a $150,000 Ferrari, we wake up with a little bit of buyer's remorse of dear lord, that was an awful lot of money. When you do the equivalent in AWS, you look at that, and instead of blaming the vendor for overcharging, instead we feel wow, I'm not smart enough. I haven't managed that appropriately. Somehow it's my fault that I'm writing what looks like a phone number of a check every month over to AWS. >> John: It creeps up on you. >> It does. It's the boiling a frog problem. And by the time people start to take it seriously, there's a lot of ill will. There's a sense of, our team is terrible, and wasn't caring about this. But you don't ever cost-optimize your way to success. That's something you do once you have something that's up and working and viable. You don't start to build a product day one for the least possible amount of money and expect to attain any success. >> Well let's talk about that real quick to end the segment because I think that's a really important thing. Success is a double-edged sword. The benefit of the Cloud is to buy what you need, get proof of concept going, get some fly wheels going or whatever, virtuous circle of the application. But at some point, you hit a tipping point of oh shit this is working. And then the bill is huge. Better than over-provisioning and having a failed product. So where's that point with you guys or with your customers? Is there like analytics you do? Is that more of a subjective qualitative thing? You say, okay are you successful? Now let's look at it. So how do you deal with customers? 'Cause I can imagine that success is, it becomes the opportunity but also the problem. >> I think it's one of those, you know it when you see it type of moments, where if a company is spending $80,000 a month on their Cloud environment and could be spending 40, that's more interesting to a company that's three people than it is to an engineering team of 50. At that point, sorry they're embezzling more than that in office supplies every month. So that's not the best opportunity to start doing an optimization pass. More important than both of those scales to me has always been about understanding the drivers of it. So what is it that's costing that? Is it a bunch of steady state things that aren't doing work most of the time? Well, maybe there's an auto-scaling story in there. Maybe there's a serverless opportunity. Maybe nobody's using that product and it's time to start looking at rolling it in to something. >> They've left the lights on right? So to speak. >> Exactly. >> The server's are still up. Wait a minute, take them down. So, writing code, analytics, is that the answer? >> All of the above. In a vacuum, if you spin up an instance today, and don't touch it again, you will retire before that instance does. And it will continue to charge you every hour of every day. Understanding and being able to attribute who spun that up, when was it done, why was it done, and what project is it tied to? Is it some failed experiment someone did who hasn't worked here in six months? Or is that now our master database? We kind of need to know in either direction what that looks like. >> Alright before we wrap, you got to tell us, what do we expect to hear from your podcast? >> Good question. My podcast generally focuses on one-on-one conversations with people doing interesting things in the world of Cloud, which is vague enough for me to get away with almost anything as far as it goes. It's less sarcastic and snarky than some of my other work, and more at the why instead of the how. I'm not going to sit here and explain how to use an ABI. There are people far better at that than I am. But I will talk about why you might use a service, and what problem it reports to solve. >> Alright Corey, great to have you on. Uh the Screaming Pod, Screaming Cloud, >> Corey: ScreamingInTheCloud.com >> ScreamingInTheCloud.com, it's a podcast. Corey thanks for coming on and sharing the commentary, the insight on AWS, the how and the why, the Cube breaking down. All the action here in Moscone Western San Francisco, AWS 2018 Summit, back after more, after this short break. (spacey music)