>> Announcer: Live from Munich, Germany, it's The CUBE, covering DataWorks Summit Europe 2017. Brought to you by Heartenworks. >> Okay, welcome back everyone, we are here live in Munich, Germany For DataWorks 2017, the DataWorks Summit, formally Hadoop Summit. I'm John Furrier with Silicone Angle's theCUBE, my co-host Dave Vellante, wrapping up day two of coverage here with Christoph Schubert, who's the Senior Director of SAP Big Data, handles all the go-to-market for SAP Big Data, @sapbigdata is the Twitter handle. You have a great shirt there, Go Live >> Go Live or go home. (Laughs) >> John: You guys are a part. Welcome to theCUBE. >> Christoph: Thank you, I appreciate it. >> Thanks for joining us and on the wrap up. You and I have known each other, we've known each other for a long time. We've been in many Sapphires together, we've had many conversations around the role of data, the role of architecture, the role of how organizations are transforming at the speed of business, which is SAP, it's a lot of software that powers business, under transformation right now. You guys are no stranger to analytics, we have the HANA Cloud Platform now. >> Christoph: We know a thing or two about that, yeah. (laughs) >> You know a little bit about data and legacy as well. You guys power pretty much most of the Fortune 100, if not all of them. What's your thoughts on this? >> Yeah, good point. On the topic of some numbers, about 75% of the world GDP runs through SAP systems eventually. So yes, we know a thing or two about transactional and analytical systems, definitely. >> John: And you're a partner with Hortonworks >> With Hortonworks and other Cloud providers, Hadoop Providers, certainly, absolutely but in this case, Hortonworks. We have, specifically, a solution that runs on Hadoop Spark and that allows, actually, our customers to unify much, much larger data sets with a system of records that we now do so many of them around the world for new and exciting new cases. >> And you were born in Munich. This is your hometown. >> This is actually a home gig for me, exactly. So, yes, unfortunately I'll also be presenting in English but yeah, I want to talk German, Bavarian, all the time. (laughs) >> I see my parents tonight. >> I wish we could help you >> but we don't speak Bavarian. But we do like to drink the beer though. It's the fifth season but a lot of great stuff here in Germany. Dave, you guys, I want to get your thoughts on something. I wanted to get you, just 'cause you're both, you're like an analyst, Christoph as well. I know you're over at SAP but, you know, you have such great industry expertise and Dave obviously covers the stuff everyday. I just think that the data world is so undervalued, in my mind. I think the ecosystem of startups that are coming out in the, out of the open source ecosystems, which are well-defined, by the way, and getting better. But now you have startups doing things like VIMTEC, we just had a bank on. Startups creating value and things like block chain on the horizon. Other new paradigms are coming on, is going to change the landscape of how wealth is created and value is created and charged. So, you've got a whole new tsunami of change. What's your thoughts on how this expands and obviously, certainly, Hortonworks as a public company and Cloudera is going public, so you expect to see that level up in valuation. >> They're in the process, yes. >> But I still think they're both undervalued. Your thoughts. >> Well it's not just the platform, right? and that what, I think, where Hadoop also came from. The legacy of Hadoop is that you don't have to really think about how you want to use your data. You have to, don't think ahead what kind of schema you want to apply and how you want to correlate your data. You can create a large data lake, right? That's the term that was created a long time ago, that allows customers to just collect all that data and think in the second stage about what to use with it and how to correlate it. And that's exactly, now, we're also seeing in the third stage, to not just create analytics but also creating applications instead of analytics or on top of analytics, correlating with data that also drives the business, the core business, from an OLTP perspective or also from an OLAP perspective. >> I mean, Dave, you were the one who said Amazon's a trillion dollar TAM, will be the first trillion dollar company and you were kind of, but you looked at the thousand points of Live with Cloud enables, all these aggregated all together, what's your thoughts on valuation of this industry? Because if Hortonworks continues on this peer play and they've got Cloudera coming in and they're doing well, you could argue that they're both undervalued companies if you count the ecosystem. >> Well, we always knew that big data was going to be a heavy lift, right? And I would agree with what Christoph was saying, was that Hadoop is profound in that it was no schema on right and ship five magabytes of code to a pedabyte of data. But it was hard to get that right. And I remember something you said, John, at one of our early SAP Sapphires, When the big data meme was just coming through. You said, "You know, SAP is not just big data, it's fast data". And you were talking about bringing transaction and analytic data together. >> John: Right. >> Again, something that has only recently been enabled. And you think about, you know, continuous streaming. I think that, now, big data has sort of entered the young-adulthood phase, we're going to start seeing steep part of that S-curve returns, and I think the hype will be realized. I think it is undervalued, much like the internet was. It was overvalued, then nobody wanted to touch it, and then it became. Actually, if you think back to 1999, the internet was undervalued in terms of what it actually achieved. >> John: Yeah. >> I think the same or similar thing is going to happen with big data. And since we have an SAP guest on, I'll say as well, We all remember the early days of ERP. >> Mhm, oh yeah. >> It wasn't clear >> Nope. >> Who was going to emerge as the king. >> Right. >> There were a few solutions. You're right. >> That's right. And, as well, something else we said about big data, it was the practitioners of ERP that made the most money, that created the most value and the same thing is happening here. >> Yeah. In fact, on that topic, I believe that 2017 and 2018 will be the big years for big data, so to speak. >> John: Uh huh. >> In fact, because of some statistics. >> John: In what way? >> Well, we just did >> Adoption, S-curve? >> Right, exactly. Utilizing the value of big data. You're talking about valuation here, right? 75% of CEOs of the top 1000 believe that the next three years are more important to their business than the last 50. And so that tells me that they're willing to invest. Not just the financial market, where I believe really run the most sophisticated big data analytics and models today. They had real use cases with real results very quickly. And so, they showed many how it's done. They created sort of the new role of a data scientist. They have roles like an AML officer. It's a real job, they do nothing else but anti-money laundering, right? So, in that industry they've shown us how to do that and I think others will follow. >> Yeah, and I think that when you look at this whole thing about digital transformation, it's all about data. >> John: Yeah. >> I mean, if you're serious about digital transformation, you must become a data-driven company and you have to hop on that curb. Even if you're talking to the, you know, bank today who got on in 2014, which was relatively late, but the pace at which they're advancing is astronomical. >> John: Yeah. >> I don't remember his name, a British mathematician, created, about 11 years already, that according to the phrase "Data is the new oil". >> John: Mhm. >> And I think it's very true because crude oil, in its original form, you also can't use it. >> John: It has to be refined. >> Right, exactly. It has to be refined to actually use it and use the value of it. Same thing with data. You have to distill it, you have to correlate it, you have to align it, you have to relate it to business transactions so the business really can take advantage of it. >> And then we're seeing, you know, to your point, you've got, I don't know, a list of big data companies that are now in public is growing. It's still small, not much profit. >> I mean, I just think, and this is while I'm getting your reaction, I mean, I'm just reading right now some news popping on my dashboard. Google just released some benchmarks on the TPU, the transistor processing unit, >> Dave: Right. >> Basically a chip dedicated to machine learning. >> Yep. >> You know, so, you're going to start to see some abstraction layers develop, whether it's a hardened-top processor hardware, you guys have certainly done innovation on the analytic side, we've seen that with some of the specialty apps. Just to make things go faster. I mean, so, more and more action is coming, so I would agree that this S-curve is coming. But the game might shift. I mean, this is not an easy, clear path. There's bets being made in big data and there's potential for huge money shift, of value. >> See, one of the things I see, and we talked to Hortonworks about this, the new president, you know, betting all on open source. I happen to think a hybrid model is going to win. I think the rich get richer here. SAP, IBM, even Oracle, you know, they can play the open source game and say, "Hey, we're going to contribute to open source, we're going to participate, we're going to utilize open source, but we're also going to put the imprimatur of our install base, our business model, our trusted brands behind so-called big data." We don't really use that term as much anymore. It's the confluence of not only the technology but the companies who, what'd you say, 75% of the world's transactions run though SAP at some point? >> Christoph: Yeah. >> With companies like SAP behind it, and others, that's when this thing, I think, really takes off. >> What I think a lot of people don't realize, and I've been a customer, also, for a long time before I joined the vendor side, and what is under-realized is the aspect of risk management. Once you have a system and once you have business processes digitized and they run your business, you can't introduce radical changes overnight as quickly anymore as you'd like or your business would like. So, risk management is really very important to companies. That's why you see innovation within organizations not necessarily come from the core digitization organization within their enterprise, it often happens on the outside, within different business units that are closer to the product or to the customer or something. >> Something else that's happening, too, that I wanted to address is this notion of digitization, which is all about data, allows companies to jump industries. You're seeing it everywhere, you're seeing Amazon getting into content, Apple getting into financial services. You know, there's this premise out there that Uber isn't about taxicabs, it's about logistics. >> John: Yeah. >> And so you're seeing these born-digital, born in the cloud companies now being able to have massive impacts across different industries. Huge disruption creates, you know, great opportunities, in my view. >> Christoph: Yeah. >> David: What do you think? >> I mean, I just think that the disruption is going to be brutal, and I want to, I'm trying to synthesize what's happening in this show, and you know, you're going to squint through all the announcements and the products, really an upgrade to 2.6, a new data platform. But here in Europe the IOT thing just, to me, is a catalyst point because it's really a proof point to where the value is today. >> David: Mhm. >> That people can actually look at and say, "This is going to have an impact on our business tier digitization point" and I think IOT is pulling the big data industry and cloud together. And I think machine learning and things that come over the top on it are only going to make it go faster. And so that intersection point, where the AI, augmented intelligence, is going to come in, I think that's where you're going to start to see real proof points on value proposition of data. I mean, right now it's all kind of an inner circle game. "Oh yeah, got to get the insights, optimize this process here and there" and so there's some low hanging fruit, but the big shifting, mind blowing, CEO changing strategies will come from some bigger moves. >> To that point, actually, two things I want to mention that SAP does in that space, specifically, right? Startups, we have a program actually, SAP.io, that Bill McDermont also recently introduced again, where we invest in startups in this space to help foster innovation faster, right? And also connecting that with our customers. >> John: What is it called? >> SAP.io Something to look out for. And on the topic of IOT, we made, also, an announcement at the beginning of the year, Project Leonardo. >> Yeah. >> It's a commitment, it's a solution set, and it's also an investment strategy, right? We're committed in this market to invest, to create solutions, we have solutions already in the cloud and also in primus. There are a few companies we also purchased in conjunction with Loeonardo, RT specifically. Some of our customers in the manufacturing space, very strong opportunity for IOT, sensor collection, creating SLAs for robotics on the manufacturing floor. For example, we have a complete solution set to make that possible and realize that for our customers and that's exactly a perfect example where these sensor applications in IOT, edge, compute rich environments come together also with a core where, then, a system of references like machine points, for example, matter because if you manage the SLA for a machine, for example, you just not only monitor it, you want to also automatically trigger the replacement of a part, for example, and that's why you need an SAP component, as well. So, in that space, we're heavily investing, as well. >> The other think I want to say about IOT is, I see it, I mean, cloud and big data have totally disrupted the IT business. You've seen Dell buying EMC, HP had to get out of the cloud business, Oracle pivoted to the cloud, SAP obviously, going hard after the cloud. Very, very disruptive, those two trends. I see IOT as not necessarily disruptive. I see those who have the install base as adopting IOT and doing very, very well. I think it's maybe disruptive to the economy at large, but I think existing companies like GE, like Siemens, like Dimar, are going to do very, very well as a result of IOT. I mean, to the extent they embrace digitization, which they would be crazy not to. >> Alright guys, final thoughts. What's your walkaway from this show? Dave, we'll start with you. >> I was going to say, you know, Hadoop has definitely not failed, in my mind, I think it's been wildly successful. It is entering this new phase that I call sort of young-adulthood and I think it's, we know it's gone mainstream into the enterprise, now it's about, okay, how do I really drive the value of data, as we've been discussing, and hit that steep part of the S-curve. Which, I agree, it's going to be within the next two years, you're going to start to see massive returns. And I think this industry is going to be realized, looked back, it was undervalued in 2017. >> Remember how long it took to align on TCP/IP? (laughter) >> Walk away, I mean interoperability was key with TCP/IP. >> Christoph: Yeah. One of the things that made things happen. >> I remember talking about it. (laughter) >> Yeah, two megabits per second. Yeah, but I mean, bringing back that, what's your walkaway? Because is it a unification opportunity? Is it more of an ecosystem? >> A good friend of mine, also at SAP on the West Coast, Andreas Walter, he shared an observation that he saw in another presentation years ago. It was suits versus hoodies. Different kind of way to run your IT shop, right? Top-down structure, waterfall projects, and suits, open source, hack it, quickly done, you know, get in, walk away, make money. >> Whoa, whoa, whoa, the suits were the waterfall, hoodies was the agile. >> Christoph: That's correct. >> Alright, alright, okay. >> Christoph: Correct. So, I think that it's not just the technology that's coming together, it's mindsets that are coming together. And I think organizationally for companies, that's the bigger challenge, actually. Because one is very subscribed, change control oriented, risk management aware. The other is very progressive, innovative, fast adopters. That these two can't bring those together, I think that's the real challenge in organizations. >> John: Mhm, yeah. >> Not the technology. And on that topic, we have a lot of very intelligent questions, very good conversations, deep conversations here with the audience at this event here in Munich. >> Dave, my walkaway was interesting because I had some preconceived notions coming in. Obviously, we were prepared to talk about, and because we saw the S1 File by Cloudera, you're starting to see the level of transparency relative to the business model. One's worth one billion dollars in private value, and then Hortonworks pushing only 2700 million in a public market, which I would agree with you is undervalued, vis a vis what's going on. So obviously, you're going to see my observation coming in from here is that I think that's going to be a haircut for Cloudera. The question is how much value will be chopped down off Cloudera, versus how much value of Hortonworks will go up. So the question is, does Cloudera plummit, or does Cloudera get a little bit of a haircut or stay and Hortonworks rises? Either way, the equilibrium in the industry will be established. The other option would be >> Dave: I think the former and the numbers are ugly, let's not sugarcoat it. And so that's got to change in order for this prediction that we're making. >> John: Former being the haircut? >> Yeah, the haircut's going to happen, I think. But the numbers are really ugly. >> But I think the question is how far does it drop and how much of that is venture. >> Sure. >> Venture, arbitrage, or just how they are capitalized but Hortonworks could roll up. >> But my point is that those numbers have to change and get better in order for our prediction to come true. Okay, so, but in your second talk, sorry to interrupt you but >> No, I like a debate and I want to know where that line is. We'll be watching. >> Dave: Yeah. >> But the value in, I think you guys are pointing out but I walk away, is IOT is bigger here, and I already said that, but I think the S-curve is, you're right on. I think you're going to start to see real, fast product development around incorporating data, whether that's a Hortonworks model, which seems to be the nice unifying, partner-oriented one, that's going to start seeing specialized hardware that people are going to start building chips for using flash or other things, and optimizing hard complexities. You pointed that out on the intro yesterday. And putting real product value on the table. I think the cards are going to start hitting the table in ecosystem, and what I'm seeing is that happening now. So, I think just an overall healthy ecosystem. >> Without a doubt. >> Okay. >> Great. >> Any final comments? >> Let's have a beer. >> Great to see you in Munich. (laughter) >> We'll have a beer, we had a pig knuckle last night, Dave. We had some sauerkraut. >> Christoph: (speaks foreign word) >> Yeah, we had the (speaks foreign word). Dave, we'll grab the beer, thanks. Good to be with you again. Thanks to the crew, thanks to everyone watching. >> Thanks, John. >> The CUBE, signing off from Munich, Germany for DataWorks 2017. Thanks for watching, see ya next time. (soft techno music)