>> Announcer: Live from Las Vegas, it's theCUBE. Covering Veritas Vision 2017. Brought to you by Veritas. (peppy digital music) >> Veritas Vision 2017 everybody. We're here at The Aria Hotel. This is day two of theCUBE's coverage of Vtas, #VtasVision, and this is theCUBE, the leader in live tech coverage. My name is Dave Vellante, and I'm here with Stuart Miniman who is my cohost for the week. Stu, we heard Richard Branson this morning. The world-renowned entrepreneur Sir Richard Branson came up from the British Virgin Islands where he lives. He lives in the Caribbean. And evidently he was holed out during the hurricane in his wine cellar, but he was able to make it up here for the keynote. We saw on Twitter, so, great keynote, we'll talk about that a little bit. We saw on Twitter that he actually stopped by the Hitachi event, Hitachi NEXT for women in tech, a little mini event that they had over there. So, pretty cool guy. Some of the takeaways: he talked a lot about- well, first of all, welcome to day two. >> Thanks, Dave. Yeah, and people are pretty excited that sometimes they bring in those marquee guests, someone that's going to get everybody to say, "Okay, wait, it's day two. "I want to get up early, get in the groove." Some really interesting topics, I mean talking about, thinking about the community at large, one of the things I loved he talked about. I've got all of these, I've got hotels, I've got different things. We draw a circle around it. Think about the community, think about the schools that are there, think about if there's people that don't have homes. All these things to, giving back to the community, he says we can all do our piece there, and talking about sustainable business. >> As far as, I mean we do a lot of these, as you know, and as far as the keynote speakers go, I thought he was one of the better ones. Certainly one of the bigger names. Some of the ones that we've seen in the past that I think are comparable, Bill Clinton at Dell World 2012 was pretty happening. >> There's a reason that Bill Clinton is known as the orator that he is. >> Yeah, so he was quite good. And then Robert Gates, both at ServiceNow and Nutanics, Condi Rice at Nutanics, both very impressive. Malcolm Gladwell, who's been on theCUBE and Nate Silver, who's also been on theCUBE, again, very impressive. Thomas Friedman we've seen at the IBM shows. The author, the guy who wrote the Jobs book was very very strong, come on, help me. >> Oh, yeah, Walter Isaacson. >> Walter Isaacson was at Tableau, so you've seen some- >> Yeah, I've seen Elon Musk also at the Dell show. >> Oh, I didn't see Elon, okay. >> Yeah, I think that was the year you didn't come. >> So I say Branson, from the ones I've seen, I don't know how he compared to Musk, was probably the best I think I've ever seen. Very inspirational, talking about the disaster. They had really well-thought-out and well-produced videos that he sort of laid in. The first one was sort of a commercial for Richard Branson and who he was and how he's, his passion for changing the world, which is so genuine. And then a lot of stuff on the disaster in the British Virgin Islands, the total devastation. And then he sort of went into his passion for entrepreneurs, and what he sees as an entrepreneur is he sort of defined it as somebody who wants to make the world a better place, innovations, disruptive innovations to make the world a better place. And then had a sort of interesting Q&A session with Lynn Lucas. >> Yeah, and one of the lines he said, people, you don't go out with the idea that, "I'm going to be a businessman." It's, "I want to go out, I want to build something, "I want to create something." I love one of the early anecdotes that he said when he was in school, and he had, what was it, a newsletter or something he was writing against the Vietnam War, and the school said, "Well, you can either stay in school, "or you can keep doing your thing." He said, "Well, that choice is easy, buh-bye." And when he was leaving, they said, "Well, you're either going to be, end up in jail or be a millionaire, we're not sure." And he said, "Well, what do ya know, I ended up doing both." (both laughing) >> So he is quite a character, and just very understated, but he's got this aura that allows him to be understated and still appear as this sort of mega-personality. He talked about, actually some of the interesting things he said about rebuilding after Irma, obviously you got to build stronger homes, and he really sort of pounded the reducing the reliance on fossil fuels, and can't be the same old, same old, basically calling for a Marshall Plan for the Caribbean. One of the things that struck me, and it's a tech audience, generally a more liberal audience, he got some fond applause for that, but he said, "You guys are about data, you don't just ignore data." And one of the data points that he threw out was that the Atlantic Ocean at some points during Irma was 86 degrees, which is quite astounding. So, he's basically saying, "Time to make a commitment "to not retreat from the Paris Agreement." And then he also talked about, from an entrepreneurial standpoint and building a company that taking note of the little things, he said, makes a big difference. And talking about open cultures, letting people work from home, letting people take unpaid sabbaticals, he did say unpaid. And then he touted his new book, Finding My Virginity, which is the sequel to Losing My Virginity. So it was all very good. Some of the things to be successful: you need to learn to learn, you need to listen, sort of an age-old bromide, but somehow it seemed to have more impact coming from Branson. And then, actually then Lucas asked one of the questions that I put forth, was what's his relationship with Musk and Bezos? And he said he actually is very quite friendly with Elon, and of course they are sort of birds of a feather, all three of them, with the rocket ships. And he said, "We don't talk much about that, "we just sort of-" specifically in reference to Bezos. But overall, I thought it was very strong. >> Yeah Dave, what was the line I think he said? "You want to be friends with your competitors "but fight hard against them all day, "go drinking with them at night." >> Right, fight like crazy during the day, right. So, that was sort of the setup, and again, I thought Lynn Lucas did a very good job. He's, I guess in one respect he's an easy interview 'cause he's such a- we interview these dynamic figures, they just sort of talk and they're good. But she kept the conversation going and asked some good questions and wasn't intimidated, which you can be sometimes by those big personalities. So I thought that was all good. And then we turned into- which I was also surprised and appreciative that they put Branson on first. A lot of companies would've held him to the end. >> Stu: Right. >> Said, "Alright, let's get everybody in the room "and we'll force them to listen to our product stuff, "and then we can get the highlight, the headliner." Veritas chose to do it differently. Now, maybe it was a scheduling thing, I don't know. But that was kind of cool. Go right to where the action is. You're not coming here to watch 60 Minutes, you want to see the headline show right away, and that's what they did, so from a content standpoint I was appreciative of that. >> Yeah, absolutely. And then, of course, they brought on David Noy, who we're going to have on in a little while, and went through, really, the updates. So really it's the expansion, Dave, of their software-defined storage, the family of products called InfoScale. Yesterday we talked a bit about the Veritas HyperScale, so that is, they've got the HyperScale for OpenStack, they've got the HyperScale for containers, and then filling out the product line is the Veritas Access, which is really their scale-out NAS solution, including, they did one of the classic unveils of Veritas Software Company. It was a little odd for me to be like, "Here's an appliance "for Veritas Bezel." >> Here's a box! >> Partnership with Seagate. So they said very clearly, "Look, if you really want it simple, "and you want it to come just from us, "and that's what you'd like, great. "Here's an appliance, trusted supplier, "we've put the whole thing together, "but that's not going to be our primary business, "that's not the main way we want to do things. "We want to offer the software, "and you can choose your hardware piece." Once again, knocking on some of those integrated hardware suppliers with the 70 point margin. And then the last one, one of the bigger announcements of the show, is the Veritas Cloud Storage, which they're calling is object storage with brains. And one thing we want to dig into: those brains, what is that functionality, 'cause object storage from day one always had a little bit more intelligence than the traditional storage. Metadata is usually built in, so where is the artificial intelligence, machine learning, what is that knowledge that's kind of built into it, because I find, Dave, on the consumer side, I'm amazed these days as how much extra metadata and knowledge gets built into things. So, on my phone, I'll start searching for things, and it'll just have things appear. I know you're not fond of the automated assistants, but I've got a couple of them in my house, so I can ask them questions, and they are getting smarter and smarter over time, and they already know everything we're doing anyway. >> You know, I like the automated assistants. We have, well, my kid has an Echo, but what concerns me, Stu, is when I am speaking to those automated assistants about, "Hey, maybe we should take a trip "to this place or that place," and then all of a sudden the next day on my laptop I start to see ads for trips to that place. I start to think about, wow, this is strange. I worry about the privacy of those systems. They're going to, they already know more about me than I know about me. But I want to come back to those three announcements we're going to have David Noy on: HyperScale, Access, and Cloud Object. So some of the things we want to ask that we don't really know is the HyperScale: is it Block, is it File, it's OpenStack specific, but it's general. >> Right, but the two flavors: one's for OpenStack, and of course OpenStack has a number of projects, so I would think you could be able to do Block and File but would definitely love that clarification. And then they have a different one for containers. >> Okay, so I kind of don't understand that, right? 'Cause is it OpenStack containers, or is it Linux containers, or is it- >> Well, containers are always going to be on Linux, and containers can fit with OpenStack, but we've got their Chief Product Officer, and we've got David Noy. >> Dave: So we'll attack some of that. >> So we'll dig into all of those. >> And then, the Access piece, you know, after the apocalypse, there are going to be three things left in this world: cockroaches, mainframes, and Dot Hill RAID arrays. When Seagate was up on stage, Seagate bought this company called Dot Hill, which has been around longer than I have, and so, like you said, that was kind of strange seeing an appliance unveil from the software company. But hey, they need boxes to run on this stuff. It was interesting, too, the engineer Abhijit came out, and they talked about software-defined, and we've been doing software-defined, is what he said, way before the term ever came out. It's true, Veritas was, if not the first, one of the first software-defined storage companies. >> Stu: Oh yeah. >> And the problem back then was there were always scaling issues, there were performance issues, and now, with the advancements in microprocessor, in DRAM, and flash technologies, software-defined has plenty of horsepower underneath it. >> Oh yeah, well, Dave, 15 years ago, the FUD from every storage company was, "You can't trust storage functionality "just on some generic server." Reminds me back, I go back 20 years, it was like, "Oh, you wouldn't run some "mission-critical thing on Windows." It's always, "That's not ready for prime time, "it's not enterprise-grade." And now, of course, everybody's on the software-defined bandwagon. >> Well, and of course when you talk to the hardware companies, and you call them hardware companies, specifically HPE and Dell EMC as examples, and Lenovo, etc. Lenovo not so much, the Chinese sort of embraced hardware. >> And even Hitachi's trying to rebrand themselves; they're very much a hardware company, but they've got software assets. >> So when you worked at EMC, and you know when you sat down and talked to the guys like Brian Gallagher, he would stress, "Oh, all my guys, all my engineers "are software engineers. We're not a hardware company." So there's a nuance there, it's sort of more the delivery and the culture and the ethos, which I think defines the software culture, and of course the gross margins. And then of course the Cloud Object piece; we want to understand what's different from, you know, object storage embeds metadata in the data and obviously is a lower cost sort of option. Think of S3 as the sort of poster child for cloud object storage. So Veritas is an arms dealer that's putting their hat in the ring kind of late, right? There's a lot of object going on out there, but it's not really taking off, other than with the cloud guys. So you got a few object guys around there. Cleversafe got bought out by IBM, Scality's still around doing some stuff with HPE. So really, it hasn't even taken off yet, so maybe the timing's not so bad. >> Absolutely, and love to hear some of the use cases, what their customers are doing. Yeah, Dave, if we have but one critique, saw a lot of partners up on stage but not as many customers. Usually expect a few more customers to be out there. Part of it is they're launching some new products, not talking about very much the products they've had in there. I know in the breakouts there are a lot of customers here, but would have liked to see a few more early customers front and center. >> Well, I think that's the key issue for this company, Stu, is that, we talked about this at the close yesterday, is how do they transition that legacy install base to the new platform. Bill Coleman said, "It's ours to lose." And I think that's right, and so the answer for a company like that in the playbook is clear: go private so you don't have to get exposed to the 90 day shock lock, invest, build out a modern platform. He talked about microservices and modern development platform. And create products that people want, and migrate people over. You're in a position to do that. But you're right, when you talk to the customers here, they're NetBackup customers, that's really what they're doing, and they're here to sort of learn, learn about best practice and see where they're going. NetBackup, I think, 8.1 was announced this week, so people are glomming onto that, but the vast majority of the revenue of this company is from their existing legacy enterprise business. That's a transition that has to take place. Luckily it doesn't have to take place in the public eye from a financial standpoint. So they can have some patient capital and work through it. Alright Stu, lineup today: a lot of product stuff. We got Jason Buffington coming on for getting the analyst perspective. So we'll be here all day. Last word? >> Yeah, and end of the day with Foreigner, it feels like the first time we're here. Veritas feels hot-blooded. We'll keep rolling. >> Alright, luckily we're not seeing double vision. Alright, keep it right there everybody. We'll be back right after this short break. This is theCUBE, we're live from Vertias Vision 2017 in Las Vegas. We'll be right back. (peppy digital music)

[Announcer] - Live from Washington D.C., it's theCUBE, covering .NEXT Conference brought to you by Nutanix. >> We're back in D.C., welcome to NextConf, this is day two of our wall-to-wall coverage and this is theCUBE, the leader in live tech coverage. My name is Dave Vellante with Stu Miniman. Dheeraj Pandey is here, he's the chairman and CEO of Nutanix. Long time CUBE alum. Great to see you again. >> Pleasure. >> So you know, I love your style, up on stage yesterday. Very philosophical, always have been humble. You sort of said, "I'm going to stay humble," and it appears that's the case. But yet, there's so much excitement around here, you have a lot to be very proud of. How do you feel? >> You know, there's no finish line in this company building, just like there's no finish line when you have a family, it never ends actually. Nutanix is a family, and we are trying to make it a bigger, happier family with more customers, more partners, more employees. I feel good, but I think this company is good right now, it's not a great company. We probably will have to spend another decade to make it a great company actually, so. >> How do you, as the chairman and CEO, how do you define "great company"? >> Great companies, for one, actually take really good care of their stakeholders. You think about employees and customers and partners and also Wall Street, so I think at the end of the day we have barely begun the journey in some of these things. Customers, sure, we have quite a few of them, but I think we can do so much more for them. At some level, even in the largest accounts, we're barely scratching the surface actually. Same thing with employees, you know, we have almost 3000 employees but still, we could do so much more for them as well in terms of wealth creation, in terms of building careers. Very early days. Same thing with Wall Street as well, very early days actually. >> Dheeraj, you're always opening to listening to feedback, but you mentioned, you've now got a lot of constituencies. I know I've interviewed you and said well you know, there's the 90-day shock clock but, we can't get distracted, we need to focus. How do you, you know, what is the filter, how do you, what do you take in and internalize to translate into the direction of the company? >> You know I talk about two things. There's delight, there's waste. Delight for main street and make sure you're cognizant of the waste with Wall Street, because if you keep growing they won't bother you. What they bother you with is waste. How are you growing, what does efficiency look like at scale? So I just learn "growth at any cost". I think these are all timely reminders for any company, so that it doesn't get too painful when recessions hit you, because there's highs and lows of any company that you have to go through. So I believe that waste is the larger ego of delight, and if you can do a really good job of delighting our customers, our partners, our employees and then figure out how to deal with all of this with waste in mind, I think we'll do a pretty good job. So what matters the most is delight, but not without figuring out what's waste-like. I think you have to keep looking at these "KPIs" and say how are we really doing at scale with respect to distribution, marketing, product development, product engineering. Now we have a pretty large engineering workforce as well. How can the company be delightful for them if you don't have "two-pizza teams", if you don't have APIs and microservices in which they actually talk to each other, still feel like they're the CTO of their company, because they all want to make independent decisions and design trade-offs and things of that nature. I think we talk about this thing which is a really important abstract thing, it's called the paradox of growth. I learned this from some of these folks who have done this book called The Founder's Mentality. Growth creates complexity and complexity kills growth, so just be aware of what you really vied for can kill you as well, and continue to release complexity to organizations in the way you deal with your customers, and I think those are the things that really matter. I look at employees as customers, I look at customers as customers, I look at partners as customers. If you have the customer-centric view, you'll probably continue to simplify things under the cover. >> One of the things that you see in great companies is early on they're able to articulate a vision, see that vision, execute on it obviously and continue to grow their team, I mean that's a big part of your job. You've dramatically, well first of all, the team that you started with was quite large. Cloud expands that enormously. So maybe talk about your vision and how you're seeing that through. >> Well I think from very early on, the mission was invisible infrastructure. And that is an infinite mission because again, no finish line actually. You can make things invisible and then probably say we still aren't invisible enough and you have to make it more invisible. When you have downer to four clicks you have to say how about three and two and one click? And finally get rid of the click because machine learning can come in and automate more things as well. So how more and more things go from humans to machines and how the human-man-machine interface becomes less frictioned is the vision of this company. Now, all of this is not just graphical UI because the systems have to work, they have to be scalable, stable, reliable, available. So the back-end has to be very robust but then without a front-end it's really the same as a man-machine interface. Also the machine-machine interface, because APIs match for a lot as well, you know. If you're only thinking about man-machine, then you've lost a lot of this automation and machine learning capability as well, actually. >> I think back to some of our earliest conversations, you always talked about Nutanix is a software company and the challenge of our day is building distributed systems. The tooling and the way we build things today are very different from when you started the company. If you were starting from a bare sheet today, would you be born in the cloud, you know, how would things like containers and microservices change the way, or, and how are you taking from where you are today, which it started out in virtualization, is that a core, you've got AHV driving a lot of the pieces, versus some of those who are models? >> Yeah, I mean, look, VMware was building an operating system, but they needed a shield of EMC to go sell and distribute that. We had the compute virtualization piece that came a little bit later, but the storage virtualization, the control plane pieces, we needed to shield them, and we shield them in appliance, and that became our form factor the could give us the control of our own destiny, and that's what the appliance did to us. But you always knew you were building software, actually. And many people told us early on, just don't build appliances at all, and we would've been killed, we probably would have to sell this company early on, because it's really hard to build an OS company early on when you don't have a brand and nobody's willing to support you and customers are like, you know, if nobody else is willing to support you, how do you really build an operating system, actually? So I think if there's a method to the madness, we always knew we had to be hardware-agnostic, that's why we never built NVRAMs and FBGAs and things like that. And over time when Dell came forward and said look, you should OEM your product, I think it was a very natural decision for us two and a half, three years ago. I think there's been this controlled release of goodness of this operating system that basically not mean like oh we never thought about it, we always thought about hardware-agnosticism, hypervisor-agnosticism, all those things were there from day one in this company. But you know the question of whether we would start in the cloud today? Honestly, all companies have to start where they are in order to make money, and continue to navigate the shifting sands of time actually. I mean, you sell books, then realize it's not good enough, you go and sell, you know goods with e-commerce, and that's not good enough, you sell computing. We started an office productivity company, go and do a desktop operating system, then you go and do databases and server operating system and then all sorts of things for the family room and so on and then finally do a cloud. I think there's no, you know, change is the only constant you know, if you were to think about it, and companies that actually survive and thrive, they start someplace, and their thing, every three, four years, you just find the adjacencies, and keep navigating, you know, how the market is actually shifting and changing. >> There's a strange aura around your company. Now maybe it's the allure of the product, I don't know, but you have a lot of companies now coming into this ecosystem. We have Chad on next from Dell EMC, you know, arguably one of your larger competitors, okay, but they're here and they're happy to be here. So, it's, I say, maybe it's product, but it's also part cultural. And I'm guessing that your philosophy is it can't be a zero sum game. It's got to be a win-win for the partner, so I wonder if you could add any color to that. >> Yeah, that's a great point by the way, bring up this idea that you can be all things to all people. Somebody asked me in this analyst meetup, how about just go and build a firewall? We can, there's too deep a space in there for us to go build everything, so we need to have open APIs, where others also make money. And by the way, when you have a really flourishing ecosystem, the word of mouth, that they're also making money, the word builds a larger ecosystem, a larger operating system and so on. That's what Apple 2.0 was, because in 1.0 they were all about it's me, it's mine, no one else can do anything, and then they saw Microsoft, and how it was really building this burgeoning ecosystem with APIs, APIs, and more APIs. 90 was Microsoft's decade because of APIs actually, and partners and ecosystems, and Apple learned from them by the way, so when they came out and said we built a device, they said no no no, we've also got to build iTunes, because that's ecosystem, and then they built iCloud and app store and things like that. So I think there are lessons galore in the last 20, 25 years where if you're not a good API-driven company, you're probably not a long-lasting company actually. And the idea of a platform is incomplete without those APIs and the ecosystem itself. >> There's a change in accountant coming which is going to make you, I guess, to restate the software that you've sold through the OEMs will probably have Wall Street look at you a little bit differently. We've talked in the past before about how much you want to sell as Nutanix, how much you want to sell with partners. What's that mix that you see today going forward? How much of your product will you see, hardware, software, services, what's a good mix for you? >> Yeah, I think it's a, it's a good opportunity for the company to really think about revenue 2.0, because revenue 1.0 was what we had sort of planned out four, five years ago and 2.0 is a time when we have different form factors. We have ELAs that we started doing in the last 12 months. We're selling software in CISCO and now software in HP. Obviously Zai will happen in subscription as well. Now we have markable routes to market, you know, obviously the OEMs have actually matured, both OEMs have matured. So the question is of how do we really make it simple one more time? Because obviously there's more routes to market, so as a company we're saying now we can sell more software, and with a new accounting change, which is called ASC 606, software will have to be recognized in the same quarter, we can't defer it arbitrarily. And in some ways it's a good thing, in some ways it's bad because it takes away our goodness of the waterfall, because we could have deferred more revenue, as a company we've deferred a lot, I mean, folks know we have about $465,000,000 of deferred revenue right now, because of how good we were in actually postponing this instant gratification of cutted quarter and so on. So I think some of that will have to be brought into the current quarter but in some sense it's a good thing because we can then take the gross margin of that software and sell more appliances, so I think there's some mixing that'll happen with different margin profiles that'll have to come and kind of work with each other to say can we still grow as a company beyond a billion. >> But these are income statement gymnastics, not that you're playing, but that you're able to- >> Well, there's something about guard rails of the gross margin, because Amazon, what did Amazon say, look, your gross margin, my opportunity, right? So if you just let unbridled software go and sell itself, then our gross margins will be starting to creep up, but what if you kept it within the guard rails of around 60%, and then went and sold more appliances, because the software gave us the luxury to buy growth? I think those are the kind of architectures we are actually looking at right now. >> And the knobs that you might choose to turn, but it will have an impact on the income statement from an operating profit standpoint, I mean, right? If you're going to recognize all that deferred revenue up front you know- >> Just in subscription, we can actually do one-year terms and things like that, but obviously we don't want to completely throw the baby out of the bathwater, because a lot of subscription is a good thing, and Zai will provide subscription. Hopefully as we do this Cisco and HP on software, we can do one-year terms. >> It doesn't seem like these are distractions to you, I mean, Michael Dell always talks about the 90-day shock clock. With you, you sat down with Stu after the IPO, I was struck by your comments of "look, I'm not going to get all wound up about the stock price", you know, you're not going to obsess over it. Now it's easy not to obsess when you're growing at 60, 65% a year, but it doesn't seem like it's been a big distraction for you. >> Yeah, I think it's, just like a growing customer base can be a distraction, can be a strength, you know, because you could say, well, they're asking me not to innovate at all, and have the brute force figure out a way to have velocity and quality, because existing customers want quality, because they don't know what else you can be, like, give me a faster horse, right? And then you know from within the area we innovate that's where velocity matters. Same thing is true for Wall Street as well. Main Street wants both, Wall Street is saying look, as long as you can keep growing and grow wisely, I'm not going to touch you, actually. >> I want to ask you about your customers. We've had some great customers on. Most of the customers I've talked to that are Nutanix are what I'd call, you know, they're in the early part of the adoption, they're people that, they're taking some risks, we heard NASDAQ talk you know, forget about the fear, you've got to go forward. As you grow, how do you stop, you know, the enterprise buyer from trying to shift you, change your model? I loved that you're doing things like, you know, many companies are trying to switch to, you know, consumption models to pay as you grow, but as you try to grow that customer base, how do you pull them ahead or how do they not, you know, hold you back? >> Well I think as long as we have an authentic product, customer service, sales motion relationship they'll like us. And I think obviously there are different kind of sub-functions in the customer itself like procurement versus ID versus the business user and so on, and it's a constant hussle, there's no, again way to say that it's going to be a perfect world one day. If you can keep building great products, have great customer service, and we know that our sales motion is easy because it can, it can be a really good product and have really good customer support, but customers might hate transacting with you. I think that's the last piece that matters, and I think as computing becomes a real consumer market, that's what's happening you know with cloud, you can go and buy a computer like the way you used to buy your toothpaste or mouthwash or shampoo. I think it's becoming even more customer-centric, even more customer service-focused and so on. So I think the changing landscape of computing keeps a lot of vendors honest actually. Now, that doesn't mean that everybody will innovate, enough of them will say look, I'm done, and I think one of the things we've done well in the last five years is that the thesis of the product market fit. Like well, we know this is the product direction, this is the vision of the company, it has actually stuck. You know, people have said "I like what you guys are saying," actually. Over and over and over again, I mean, combos and acquisition, people are like "I love this". HP was one of those really audacious ideas, people said "I love this, now that I see it, I love it, when I didn't see it, I was skeptical". So I think a lot of the thesis of the company around innovation have worked in our favor. I think if we keep having that luck with ourselves, good things will happen. >> So Dheeraj, your positioning of the company has usually been a little bit ahead of the market, you know, for years it was like, ah, what, that HEI thing is a niche, and it's not really much that different, oh, enterprise cloud is nothing more than, you know, kind of vapor you know, what are the misperceptions you see today that you'd want to clarify for the market as to who Nutanix is today and where you're going? >> Well the first one is that we are a hardware company, because we are a hardware company, even though we sell a lot of software within the hardware and obviously we do a lot more software these days. And the fact that HEI's the destination, where HEIs basically was a mere milestone like five years ago or something, you know, we talk about I'd say about five years ago imagine a lot of the competition is talking about SEI today, when people are saying the compute storage form factor is interesting but not that interesting because I need to figure out how to converge clouds now, not just converge devices within my data center, I need to figure out OPEX and CAPEX, how do I meld those things, how do I burst, and things like that, you know. So the story keeps evolving because the consumers, the customers, and the competitors continue to evolve the market as well actually. So I would say that people have to look at us as an OS company, and the more they try us the more they realize why we are an OS company. They look at our networking R&D, they look at our security pieces together, storage, hypervisor, and now Zai, I think, you know, good things will happen. >> I inferred from your keynote yesterday that you're on a mission to change the operating model. Certainly Amazon has changed the operating model as we well know and it's translated into their operating profit, you know, their marginal economics as we've talked about in the past are compelling, software-like for services. As you change that operate- first of all, did I get that right? Are you on that- >> I call it a consumption model. >> Consumption model, great. So where do you see that going for customers? They're obviously taking labor costs out, how far can they take that- how much can you sort of automate in that process for your own company, taking those labor costs out to drive your margin? >> I think again, now going back to this idea of invisible infrastructure, just like it has no finish line, automation has no finish line. We used to automate 50 years ago as well. Automation as a word has existed for 200 years you know, since the industrial revolution actually. So again, there's no finish line in automation, there's no finish line for what machines can do compared to humans and I think they've constantly evolved, I mean, 200 years ago we were primarily agrarian, we would do agriculture and nothing more, and today we are doing a lot more things with our brain and I think we're becoming a more evolved species actually. So I think as machines do more, humans will also figure out a way to continue to do higher level things, so I think the best part about this company is that what we have chosen has no end to it, and the more we think we automate, the more we'll have to automate some more actually. And not just within the realm of compute, virtualization, or storage or networking or security, but also migration, portability, you know, what does it mean to really look at things on and off premise and things like that, so a lot of work is around that. Application automation is a big part of it as well. >> When I hear you say there's no finish line, it reminds me of Jeff Bezos, he says, "there is no day two, we will always be in day one". The two concerns I have, that is, number one, you can't have your employees constantly be charging, you know they run to the point where they're going to burn out and I hear Amazon is a challenging company to work for. Secondly, every customer I talk to, like, boy, they can't keep up with the six week release cycles that are coming at that, you know, remember when it used to be 18 to 24 months, you know, that was nice, we could do upgrade cycles when we want. How do you internally and with customers manage that pace of change and avoid burnout or over-complicating the environment for your customers? >> That's a great point actually, because obviously, if you don't have delighted work, it's hard. For them right now their delight, for Amazon employees, it's stock pricing. That's the only delight they have. But I look at it as a marathon of strengths. You basically have to sprint, take some rest, like after this we'll rest a little, and then say let's go and do another sprint, because NIS is another sprint, you know, and then reading all this stuff is another sprint, so I think if we can keep looking at that, and plus even do a little bit of baton-passing that'll happen, you know, I think as a company, we were all in San Jose and now some of the baton has passed to Seattle, some of the baton has passed to RDP Durham and Bangalore. We build this distributed workforce where different teams are coming in and saying "now I can run with it as well", like Bangalore could not have run with this six, seven, eight years ago, because everything was here. You know, RDP and Seattle were too small for us so I think there's critical mass emerging where the overall morale of the workforce is actually just as good as it was like five, six, seven years ago. Now, people talk about burnout a lot, but I also believe that a lot of this is choice. People who are saying "I know how to blend work and life". It's becoming hybrid, there's no such thing as work separate, life separate, it's melding into each other right now, and it's really becoming like this where people who are working smarter saying "I can figure out what that means in terms of balance". And millenials are again one of those who were born with all these things from day one. So the devices have been with them from day one, actually. They're saying "well, I can't not interact with the machine some time or the other". So I think that a lot of this is evolution for us, I mean, the eight to five way of looking at work, which is "batch processing", is now becoming multitasking and so on, so what happened to operating systems 30, 40 years ago is what's happening to humans as well actually. >> You know, we're out of time, but I wanted to share with our audience, one of the unique things about this conference is that you have advisors. A lot of people hire McKinsey and it all stays, you know, behind closed doors. Condi Rice, Robert Gates, Stephen Hadley, Deepak Malhotra, these are advisors to your company and we've met them all, many have been on theCUBE. You share with your community, your advisors, and you put them in front of your community and it's great content. I've really not seen a company be that transparent with its advisors before. Deliberate? Just sort of happens? >> It's always been like that actually, you know because the more a company learns from them, honestly, the more we've gotten out of them in turns of ROI, if you just think of it from a left wing point of view, but the right wing is that people want to build careers, not just wealth, they want to build careers, they want to actually be with folks that they can look up to you know, when the going gets tough. How do you remember somebody's words? Not just in books, but you know, in flesh and blood, you're like, wow, I talked to Condi Rice, I talked to Bob Gates, I talked to Steve Hadley, these people told me exactly what they went through, and I think there's no substitute to experience actually. To me, people like Mark Templeton and Frank Slootman, they all are great sources of energy and aspiration and ambition as well. >> Outstanding. >> No compression I've heard on experience, right Dave? >> That's right. Dheeraj, I feel calm just hanging out with you here, so thanks very much for coming back on theCUBE, it's always a pleasure to see you, and thanks for having us. Alright, keep it right there everybody, Stu and I will be back with our next guest. We're live from .Next, be right back. (electronic music)

>> Announcer: Live from Washington, D.C., it's theCube covering .NEXT conference brought to you by Nutanix. >> Welcome back to the District everybody. This is theCube, the leader in live tech coverage. And this is our special presentation of Nutanix NEXT Conf, hashtag NEXTConf. My name is Dave Vellante, I'm here with Stu Miniman, my cohost for the two days of coverage at this event. Adam Japhet is here. He's the head of infrastructure at Scholastic Corp. Adam, thanks for coming on the Cube. >> Thanks for having me. >> So, is this your first .NEXT? >> This is my first .NEXT. >> Dave: What do ya think? >> There's a lot of energy here. It's a tremendous amount of energy. Just even in the size of the place. But the number of partners that you've got here and the number of customers, I'm really excited to be here. >> Well, the best is yet to come. Nutanix always does a really good job with the keynotes. >> Adam: Yeah, you haven't even opened the keynote yet, and it's already this much energy. >> Yeah, always very crisp messaging. They have great outside speakers. Robert Gates last year, Condi Rice and then, who was the illusionist? They had a-- >> Oh yeah, the guy in the box, David Blaine. Yeah, David Blaine held his breath for like nine minutes. >> He was holding his breath under water while the SE configured-- >> For the entire session? >> Yeah while the SE configured because the argument was it only takes eight minutes to configure a Nutanix solution. >> Wow. And then he came out, after eight minutes. You know he was able to configure the solution. Big hugs afterwards. Wet hugs. But anyway, it's a fun show here and it really hasn't even started yet. It started with Cube interviews. >> We've been interviewing. >> Now I'm even more excited. >> Dave: Yeah, so we've been interviewing practitioners all day. So tell us about Scholastic Corp. What do you guys do? >> Sure, so Scholastic, if you went to school in the US, you probably heard of Scholastic, but I'll reiterate it. It's the, actually, the world's largest, not just in the US, the world's largest children's book publisher and distributor. It's also a major education technology firm, so we do a lot of work within the education space with administrators, librarians, and other educators in your school system. But we're probably most recognized for our trade businesses. Which, Book Clubs, which is now called Reading Clubs, fairs and trade, and just the access to so many of the titles that so many kids in the US have grown up on. >> So, you're making sure the next generation will at least have the opportunity to read. (laughing) >> It's interesting, because I don't know if you're aware of this, but it was actually just two days ago, was the 20th anniversary of the release of the first Harry Potter book. What was called Harry Potter and the Philosopher's Stone in England and now it was called Harry Potter and the Sorcerer's Stone in the US. And actually they did some analysis. Some of the articles I was reading about it about literacy and they actually think that the Harry Potter series has contributed to, I guess we're calling them Gen Z or the post millennials or whatever, they grew up with Harry Potter, really improving literacy in the US. That's how important some of these books that we publish over the years have been. >> So you actually said, used to call it Book Club, now you call it Reading Club. So, that's sort of an indication that your business model's evolving, going digital. So when we talk about some of the drivers there. >> Absolutely, I mean that was really one of the key drivers, I think. I've been at Scholastic a long time now. 17 plus years. So I've seen lots of different evolutions have been evolved and a lot of different technology projects have been evolved, different launches. And I think in particular in 2011, when the iPad came out, and we saw such a rapid transition with newspapers, and periodicals, and magazines. Myself included, I felt myself going through it. Switching to using electronic devices for consumption. The next immediate question is, is this going to make all physical books go away? And so, you know, we really pivoted hard into the digital arena at that time, because we wanted to be where our constituencies are. And interestingly, we found that actually digitization in the children's book space, maybe a little bit in the young adult space, but especially in the elementary school space, it actually has been fairly resistant of digitization. It's there. We've got a number of excellent products there. With Storia and a number of other products for delivering digital content to our consumers, but primarily children. But ultimately kids still read physical books. My kids are 11 and nine, and our house is full of physical books and we really kind of segregate the two together so that they have both the digital reading experience, which is somewhat different from the physical reading experience. Nevertheless, it is continuing to transform our industry. >> We were talking to to Virginia Gambale before. She's an advisor, a strategic advisor, to a number of companies, board member, investor. And she was talking about capital allocation and one of the questions I have is when you guys sort of look at this digital disruption, the change, at what point do you decide, okay hey, we've got to change or we'll be changed. Or we need to get ahead of this. How does that all take, how did it take place in your organization? Was it more reactive, proactive, and sort of where are you headed? >> I mean, I think the proactive elements around it is that we want to make sure that when our consumers are ready to go digital, we've got a viable product that responsive to as many devices as we think our consumers are going to use. And parallel information there, we've been watching really in the last three years how much Google has sweeped into the educational space and they have kind done that at the expense of Microsoft and Apple. And so, we see trends like that and we see how quickly digital can move into the educational spaces which is where the primary customers are and how we sell our products to children. And we knew that we needed to have a viable product there, so I think a lot of things for us are looking at different channels. Making sure that we've got a singular view of our customer and recognizing that our primary customers are really educators. That we're connecting with them and we're understanding how they're using our different models, our different lines of businesses. How they're communicating our products to the parents and children that consume them. And really getting that right balance of physical and digital products in front of every kid. I mean, our core mission is to get kids to learn to love to read. It's to generate literacy so that kids become young adults and full adults and they love to read, and that's really what the core mission is behind Scholastic. And however we can deliver the products to satisfy that mission, we're prepared to do that. >> Adam, reaching the ultimate user in that whole digital transformation, that tends to put a lot of stresses on infrastructure which is the hat you wear. So, maybe explain a little bit some of those challenges you were having and what you've done to transform on the infrastructure side to meet the requirements of the business. >> Absolutely. So in my role, in my various roles that I've had at Scholastic over the years, one of the things I've been able to experience is how different parts of the company move at different speeds. And some of it is just the nature of the function of the company. You know, your back office corporate spaces obviously are going to move somewhat slower than your digital engagement and your e-commerce space. In a role I had several years ago, where I was delivering e-commerce and digital services, I quickly realized that the traditional infrastructure models simply wasn't going to cut it at this point. We were delivering infrastructure trying to scale it out for very seasonal demand. Three, six month lead times trying to stack text stacks all stuff that end up being undifferentiated heavy lifting. So ultimately, for us, we took a couple of big leaps. One of the big leaps that we took was really moving into the public cloud several years ago and that worked out tremendously for us and we've really been able to find the right infrastructure model for delivering our customer engagement experiences has been the public cloud. But when we started to pivot towards the fact that we move physical products, you know a lot of companies don't necessarily deal with physical products anymore. I could be wrong but I don't know that Facebook has a physical, Well I guess they have their VR. They acquired, I forget the name of the VR company now but generally, companies don't deal with physical products. An all in public cloud model can work pretty well for them. But when you're dealing with physical products, latency matters. Geodata locality matters. And some of the applications that you're dealing with can be very centric to the delivery of your manufacturing and your warehouse operations. So, that's actually part of why we've been investing in Nutanix. Because we want to have that same kind of agility with our infrastructure and get out of mixing and matching various vendors text stacks deliver essentially what's a foundational platform for us to deliver business value out of. I'd rather go with one vendor, right? And have a finite set of vendors where we're delivering network and compute and storage and the service delivery of our applications on top of that, and Nutanix has worked out very well for us. >> Appreciate that Adam, and it's really interesting. We talk to customers, the two terms that get thrown out are hybrid or multi-cloud and you laid out where you're using public cloud. Do you consider your Nutanix solution, is that private cloud, hybrid cloud? (speaking over each other) Does that interact with multi-data center or any other services? >> I've kind of avoided the term hybrid cloud because what was originally marketed to us as hybrid cloud was the idea that your workload is seamlessly portable between all these different cloud providers. And we kind of realized that was never really our intent. I think multi-cloud is probably a better model for us, because we're finding that our various cloud provider services, and if you even scale beyond just the basic IS, you get to the pads and the especially SaaS layer, they're all cloud services but they're fairly fit for purpose. And a lot of what our role is as a technology organization has moved towards assembling all of these fit for purpose cloud solutions together into a service delivery that we from a technology group can deliver to our internal and external customers. And so I prefer the term multi-cloud. >> So if we could follow up on this, if I may, skepticism on hybrid cloud, but this idea of a control plane that spans multiple physical clouds, including on-prem. Is something that, am I understanding that you don't feel that that's needed in your organization or that's not feasible technically? >> I think it really depends on the applications that will be delivered to that. So for example, we're finally making our first real foray into containers. And so, we've looked at a couple of different technologies. There's a number out there like OpenShift and Kubernetes and that's really we feel the best opportunity for us to find a way to deploy a true hybrid cloud model where you can actually provision your workload. Maybe not to get so far as to the Priceline type Kayak type view of I want to deploy this workload right now and GCP is the most optimal at this point in time for that. That could be a potential future state, but again, even that feels like it's still a fair amount of undifferentiated heavy lifting for our service delivery. So we find the right mix of products so that we can deliver a kind of a cost optimal workload. And in many cases, I think that technology vendors still haven't quite figured out how to handle state. It works great with the stateless part of your applications but you need to persist your state somewhere. We're probably in the earlier stages, I would say, around utilized service delivery. >> What I heard I think is, you chose by application whether this is going to be something we do in-house because whether there is the locality, the analytics or data processing, something I need it for a reason, as opposed to other things. It's undifferentiated. Public cloud can take care of it and there's not a need to own it in town. >> Yes, you said it better than I said it. >> So the question, I think Dave's asking is how do you manage across? Do you manage them separately or do you want to manage it together? >> Probably at our maturity level, at this point we're probably really only at the governance stage. So we understand what we've got. We've got a good understanding of our cost structures in the public cloud. We don't nearly have as good as an understanding of our cost structures when we're doing hybrid deployments or on-prem deployments. And so that's probably as far as we've matured at this point, I would say. I think we do want to get to a future state where if we take other considerations in particular latency, the particular nature of that application or any other sovereignty or legal concerns outside, that we want to maintain maximum flexibility. Part of my role in the infrastructure group is to provide that kind of foundation. So, hoarding that workload is seamless across these different cloud providers and those application teams can really position the application where it is the best fit for purpose aligned with the price performance I have in mind. >> So bring it back to Nutanix for a little bit. Where do they fit? Talk about your journey a little bit. Maybe paint of picture of the infrastructure of the before, the after, what business impact it had. >> So there were really a couple of drivers for us through Nutanix. One of them is that as we moved a vast majority of our assets out of our data centers to these various cloud providers, we were left with a number of physical data centers and in many cases now, the only data centers that we're actually left with are our on-prem data centers that were no longer sized in accordance with the workload we want to maintain. Additionally for us, a lot of the investment of moving to the public cloud, we deferred a lot of the regular capital investments that we made in traditional infrastructure and we accepted the aging of that infrastructure but we recognize now that there is a fair amount of infrastructure there we need to maintain for these more local applications. And so, I wanted my team, I challenged my team last year to really take a modern approach, right? I don't want to necessarily assemble everything that we've done in the past, but in a much smaller scale to manage the local applications. I know that conversion, in particular hybrid converge, had matured pretty far by 2016. You know, what are the options out there? And so when we do our due diligence and we settled on Nutanix, we really felt that, it's both pioneering, at times even a little bit scary, because it was moving into a new foray with us. But I think it's worked out tremendously. We've started in our back office so that was actually really for that location if some mission critical workload in terms of how we actually do the fulfillment of our physical books, and we're in the process of bringing on a number of those applications off of traditional infrastructure with your segregation between your blade servers, and your chassis, and your racks, and your fiber storage, and your inline networking switches, and your storage array, and just having one condensed box that's going to run that system. >> So, for your in-house deployments, is that all Nutanix today or what's your mix? >> I'd say Nutanix is probably more, I'm getting up to the 20% range, and so 80% is still on traditional. But my goal is about a year from now that we'll, I don't know if they will be necessarily flipped but it will be more than 50 percent Nutanix. >> Is there anything that you're waiting for from Nutanix to be able to move those or is it just kind of budgets. >> It's our own people and process. >> Yeah, people and process. At this point, we're not, with any of these cloud providers, we're not as much hindered by the technology. The technology at this point is in many cases lapped our ability to actually consume it. We're drinking from several simultaneous fire hoses now, and it's which one we turn our mouths to, so. >> And you're taking advantage of Acropolis hypervisor or? >> Absolutely. That was also one of the key drivers. That was the hyper part of it really. I challenged the team. I said I want a solution where we can present a general purpose operating system and our application stack and to me bringing on a third party hypervisor at this point, it just felt like undifferentiated heavy lifting. >> And the container discussion, is Nutanix part of that too? >> Probably in our early stages. When we look at our workload right now, we don't have any on-prem workload that's been designated with containers. But I know having made the choice of Nutanix, if and when we come to that time, we'll be able to provision that on Nutanix and Acropolis. >> Not sure if you heard actually. This morning there was an announcement of partnership between Google and Nutanix so that should accelerate us on containers. >> I saw. That's very exciting. >> What's exciting about that to you? >> Well Google Cloud is one of the cloud providers we actively use today and I think they've really been a great thought leader in this space. We use a number of their services and I know they've really advanced the community around containers with Kubernetes and some of the technologies that they're working on. They have a very mature cloud offering today. And so I think the opportunity for us, that Google and Nutanix to work more closely together, I think a company like Scholastic is really only going to see the fruits, the benefits, of that relationship, and ease our growth into both platforms. >> Right. Adam, we have to leave it there. Thanks very much for coming on theCube and sharing your insights and your story. >> Adam: Appreciate it, appreciate it. Thanks having me on. >> You're very welcome. >> Adam: Okay. >> Alright keep it right there everybody. Stu and I'll be back with our next guest right after this short break. This is theCube. We're live from D.C. at Nutanix.Next. We'll be right back. (techno music)