(upbeat music) >> Hey everyone, welcome to this event: Build Your Cloud Center of Excellence. I'm your host, Lisa Martin, and I have two guests here with me today to talk about the hybrid cloud, the multi-cloud trends, and specifically the complexity. While we know these trends provide agility and flexibility for customers, they also bring in complexity. And this session is going to focus on exploring that with RBI and HitachiVantara. Please welcome my guests, Adithya Sastry the SVP of Digital Solutions at HitachiVantara and Werner Mayer, head of group core IT and head of group data at RBI International. Guys, welcome to the program. >> Thank you Lisa. Werner, nice to see you again. >> Great to see you both. >> And Werner, we're going to start with you. Talk about RBI. Tell the audience a little bit about what the business is and then we're going to get into your cloud transformation journey over the last couple of years. >> Yes, thank you. So Raiffeisen Bank International is international working banking groups. So our core markets are Central Eastern European, Central Eastern Europe and Austria. And we are serving around 50 million clients in this market. So we active in 13 markets. >> Got it. Talk to me, Werner about the cloud transformation journey that RBI has been on over the last couple of years and some of the complexities that you've experienced as you've launched it. >> Sure. Thank you for the question. So in 2020, we decided that we have to renew our IT strategy. And the aim of the strategy was to change the organization in a way that it can react and adapt fast to the future challenges. So one of the important pillars for us was that we are adapting fast also for new technologies. And this was core pillar in our strategy. So we're searching for technologies which are fit in to our HR transformation. And we found that the cloud and the public cloud environment fits to this venture. So we tested that. We are building up also the competent centers for that and also established the group cloud platform for that. Because our invoice to onboard our international group with the 13 units to this group cloud platform. So that means we have a lot to do to hardening the platforms in terms of security to put in. We have standard for that. We have to introduce large scale programs to train hundreds of engineers. We tested the approach, We convinced the top management and we implemented this, this program. So one of the highlights was, of course, also the the safeguarding of the Ukraine, let's say, banking environment. So we had to lift and shift the complete bank in three months. And it shows that let's say our platforms works. And let's say the approach is proven that we can scale it over the group. >> That's a big challenge. A lot of complexity especially with some of the global things going on. Adithya, these challenges are, are not unique to RBI. A lot of your customers are facing challenges with complexity around cloud management, cloud ops. What can you unpack was the real issue is here? >> Yeah, Lisa, absolutely. And you know, before I answer your question, I do want to, you know, just say a couple of things about Raiffeisen Bank. And you know, we've had the pleasure of working with them for about a year, a little bit more than a year now. And, and, and the way they approach the cloud transformation journey is - should be a template for a lot of the organizations in terms of the preparation in terms of understanding, you know. How other companies have done it and what are the pitfalls. What's worked, and really what's the recipe for their, you know, journey, right? Which is very unique because, you know, you look at you know, being present across 30 different countries within central and eastern Europe as Werner said. And the complexities of dealing with local regulations, GDPR and all these other issues that come with it, right? And not to mention the language variation from country to country. So, you know, phenomenal story there. The journey and the journey still goes, right Werner? It's not complete yet. But Lisa, to your question, you know. When we look at, you know, the complexities of this transformation, that most modern enterprises are going through. It's not very unique, right? What is unique for a Raiffeisen Bank is - has been the preparation. As you get into this journey of moving workloads to cloud, be it refactoring, modernizing, migrating, etc. One of the things that really is often overlooked is: "Are my applications and data workloads resilient on the cloud?" Meaning  how is the performance? Are they just running or are they performing with high availability to meet your customers goals? Is it scalable? And are my cost in line with what I projected when I moved prep. >> Because that's one of the areas we are seeing where you know, what enterprises projected from a cost savings to what they're realizing a year and a half into the journey is a pretty big delta, right? And, and, and a lot of it is dependent on are the cloud - are the applications and the workloads cloud, designed for the cloud? Or are they designed for on-prem which you just move to the cloud. >> So Werner, it sounds like what Adithya said is a compliment to, to you guys and the team at RBI in terms of this being a template for managing complexity. Give us, Werner, your perspective in terms of modern cloud ops. What's in? What's out? What is it that customers really need to be focusing on to be successful? >> Thanks for the compliment, Lisa. And I think this is a great relationship also in the journey. Topic is, is, is a - is a complex program where a lot of things have to fit together. But it was mentioning the resilience. The course, we call it finops, security operations and so on have to come together and have to work on spot. At the end, it's also, let's say, how we are able enabling our teams and how we are ramping out the skills of our teams to deal with these multidimensional, let's say environments. And this is something what we spend a lot of time in order to prepare, but also to bring up the people on a certain level that they can operate at. Because card guard handling is, is different than before. Because beforehand you have central operations team. They do everything for you. But in this world let's say we are also putting the responsibility of the run component of the absent to the - in the tribes and the application teams. And they have to do much more than before. On the other hand, we have first central rules. We have monitoring functions. We have support functions on that in order to best support them in their journey. So this is a hybrid between, let's say, what the teams have to do with the responsibility in the teams, but also with the central functions which are supporting them. And everything have to work together and goes hand in - right, to go hand-in-hand. >> Yeah. Yeah. And if, if I could just add Lisa really quick and and Werner hit the nail on the head, right? Because you cannot look at cloud operation the way we have traditionally looked at managed services. That's the key thing, right? You cannot, you know, traditional managed services you had L1, L2, L3 and then it goes into some sort of a vacuum and then all of a sudden somebody calls you at some point, right? >> Werner: Exactly. >> And it really has flipped, right? To, to Werner's point. And Werner hit that name on the head because you really have to understand. Bring an engineering led approach to make sure that the problems, you know, when you see an issue that you have some level of automation in terms of problem isolation. And then the problem is routed the right individual ie the application engineering team or the data engineering team for resolution in a rapid manner. Right? I think that the key - >> Yes. A very important point with that is said, yeah. So you cannot traditional transport let's say, the operation model what you have now into the cloud because this will not work, yeah. And finally at the end you will not benefit on the technology possibilities there. So super important point. My vision in the cloud and this is also something what we are working on is a sort of zero-ops environment, yeah? Because we're ultimately dealing with the automatization technologies and so on, you can that much - to much more compared to the traditional environment and the benefit of the cloud is: You can test it. You can give it feedback when it is not working, yeah? So it's a completely different operating model. What we try to establish in the cloud environment. >> So really what this seems like guys is is quite a delicate balance that you're solving for. Not the only delicate balance but Werner sticking with you. Talk to us about some of the challenges that you've had around cloud cost management in particular. Help us understand that. >> Thanks for the question. So in principle, we are doing very well on the cost side, surprisingly. And we also started the cloud journey that is said this is not the cost case. Because as I said before, let's say one of the pillars in the strategy strategy was the enablement of technology to the benefit of customer solutions to be adaptive, to be faster. But at the end it turned out that let's say with giving the responsibility of the operation to the dedicated team, they found they - they were working much closer to the cost, and let's say monitoring the cost, then we headed into traditional environments, yeah? I also saw some examples in the group where sort of gamification of the cost were going on. To say who can save more To say who can save more and make more much more out of that what you have in the cloud. And at the end we see that in minimum the cost are balance to the traditional environments in the data centers. But we also saw that let's say, the cost were brought down much more than before. So at the beginning we were relative conservative with the assumptions, yeah? But it turns out that we are really getting the benefit. The things are getting faster and also the costs are going down. And we see this in real cases. >> Yeah. And, and, and Lisa, if I could add something really quick, right? Because - There's been a mad rush to the cloud, right? Everybody kind of, it was, you know, the buzz the buzz was let's get to the cloud. We'll start to realize all these savings. And all of a sudden, everything kind of magically gets better, right? And what we have seen is also, you know, companies or customers or enterprises that have started this journey about 5, 6 years ago and are about, you know, a few years into it. What we are realizing is the cloud costs have increased significantly to what their projections were early on. And the way they're trying to address the cloud cost is by creating a FinOps organization that's looking at, you know, the cost of cloud from a structure standpoint and support as a reactive measure. Saying, "Hey if we move from Azure or one provider to another is there any benefit? If we move certain applications from the cloud back to on-prem, is there any benefit?" When in fact, one of the things that we have noticed really is: The problem needs to shift left to the engineering teams. Because if you are designing the applications and the systems the right way to begin with, then you can manage the data cost issues or the cost overruns, right? So you design for the cloud as opposed to designing and then looking at how do we optimize cloud. >> So Adithya, you talked about the RBI use case as really kind of a template but also some of the challenges with respect to hybrid and multi-cloud are kind of like a chicken and egg scenario. Talk to us kind of like overall about how Hitachi is really helping customers address these challenges and maximize the benefits to get the flexibility to get the agility so that they can deliver what their end user customers are expecting. >> Yeah, yeah. So, so one of the things we are doing, Lisa, when we work with customers, is really trying to understand, you know, look at their entire portfolio of applications, right? And, and look at what the intent of the applications is between customer facing, external customer, internal customer, high availability, production, etc., right? And then we go through a methodology called E3 which is envision, enable and execute. Which is really envision what the end stage should be regardless of what the environment is, right? And then we enable, which is really kind of go through a proof of value to move a few workloads, to modernize, rearchitect, replatform, etc. And look at the benefit of that application on its destination. If it's a cloud - if it's a cloud service provider or if it's another data center, whatever it may be, right? And finally, you know, once we've proven the value and the benefit and and say and kind of monetize the, you know realize the value of it from an agility, from a cost, from security and resilience, etc. Then we go through the execution, which was look we look at the entire portfolio, the entire landscape. And we go through a very disciplined manner working with our customers to roadmap it. And then we execute in a very deliberate manner where you can see value every 2-3 months. Because gone the days when you can do things as a science project that took 2-3 years, right? We, we - Everyone wants to see value, want to see - wants to see progress, and most importantly we want to see cost benefit and agility sooner than later. >> Those are incredibly important outcomes. You guys have done a great job explaining what you're doing together. This sounds like a great relationship. All right, so my last question to both of you is: "If I'm a customer and I'm planning a cloud transformation for my company, what are the two things you want me to remember and consider as I plan this? Werner, we'll start with you. >> I would pick up two things, yeah? The first one is: When you are organizing your company in HR way, then cloud is the HR technology for the HR transformation. Because HR teams needs HR technology. And the second important thing is, what I would say is: Cloud is a large scale and fast moving technology enabler to the company. So if your company is going forward to say: Technology is their enabler tool from a future business then cloud can support this journey. >> Excellent. I'm going to walk away with those. And Adithya, same question to you. I'm a, I'm a customer. I'm at an organization. I'm planning a cloud transformation. Top two things you want me to walk away with. >> Yeah. And I think Werner kind of actually touched on that in the second one, which is: it's not a tech, just an IT or a technology initiative. It is a business initiative, right? Because ultimately what you do from this cloud journey should drive, you know, should lead into business transformation or help your business grow top line or drive margin expansion, etc. So couple of things I would say, right? One is, you know, get Being and prioritize. Work with your business owners, with, you know with the cross-functional team not just the technology team. That's one. The second thing is: as the technology team or the IT team shepherds this journey, you know, keep everyone informed and engaged as you go through this journey. Because as you go through moving workloads modernizing workload, there is an impact to, you know receivables through omnichannel experiences the way customers interact and transact with you, right? And that comes with making making sure your businesses are aware your business stakeholders are aware. So in turn the end customers are aware. So you know, it's not a one and done from an engagement, it's a journey. And bring in the right experts. Talk to people who've done it, done this before, who have kind of stepped in all the pitfalls so you don't have to, right? That's the key. >> That's great advice. That's great advice for anything in life, I think. You talk about the collaboration, the importance of the business and the technology folks coming together. It really has to be - It's a delicate balance as we said before but it really has to be a holistic collaborative approach. Guys, thank you so much for joining me talking through what HitachiVantara and RBI are doing together. It sounds like you're well into this journey and it sounds like it's going quite well. We thank you so much for your insights and your perspectives. >> Thank you, Lisa. Werner, thank you again. >> Good stuff guys. For my guests, I'm Lisa Martin. Thank you so much for watching our event: Build Your Cloud Center of Excellence. (upbeat music)

(upbeat music) >> Hey everyone, welcome to this event: Build Your Cloud Center of Excellence. I'm your host, Lisa Martin, and I have two guests here with me today to talk about the hybrid cloud, the multi-cloud trends, and specifically the complexity. While we know these trends provide agility and flexibility for customers, they also bring in complexity. And this session is going to focus on exploring that with RBI and HitachiVantara. Please welcome my guests, Adithya Sastry the SVP of Digital Solutions at HitachiVantara and Werner Mayer, head of group core IT and head of group data at RBI International. Guys, welcome to the program. >> Thank you Lisa. Werner, nice to see you again. >> Great to see you both. >> And Werner, we're going to start with you. Talk about RBI. Tell the audience a little bit about what the business is and then we're going to get into your cloud transformation journey over the last couple of years. >> Yes, thank you. So Raiffeisen Bank International is international working banking groups. So our core markets are Central Eastern European, Central Eastern Europe and Austria. And we are serving around 50 million clients in this market. So we active in 13 markets. >> Got it. Talk to me, Werner about the cloud transformation journey that RBI has been on over the last couple of years and some of the complexities that you've experienced as you've launched it. >> Sure. Thank you for the question. So in 2020, we decided that we have to renew our IT strategy. And the aim of the strategy was to change the organization in a way that it can react and adapt fast to the future challenges. So one of the important pillars for us was that we are adapting fast also for new technologies. And this was core pillar in our strategy. So we're searching for technologies which are fit in to our HR transformation. And we found that the cloud and the public cloud environment fits to this venture. So we tested that. We are building up also the competent centers for that and also established the group cloud platform for that. Because our invoice to onboard our international group with the 13 units to this group cloud platform. So that means we have a lot to do to hardening the platforms in terms of security to put in. We have standard for that. We have to introduce large scale programs to train hundreds of engineers. We tested the approach, We convinced the top management and we implemented this, this program. So one of the highlights was, of course, also the the safeguarding of the Ukraine, let's say, banking environment. So we had to lift and shift the complete bank in three months. And it shows that let's say our platforms works. And let's say the approach is proven that we can scale it over the group. >> That's a big challenge. A lot of complexity especially with some of the global things going on. Adithya, these challenges are, are not unique to RBI. A lot of your customers are facing challenges with complexity around cloud management, cloud ops. What can you unpack was the real issue is here? >> Yeah, Lisa, absolutely. And you know, before I answer your question, I do want to, you know, just say a couple of things about Raiffeisen Bank. And you know, we've had the pleasure of working with them for about a year, a little bit more than a year now. And, and, and the way they approach the cloud transformation journey is - should be a template for a lot of the organizations in terms of the preparation in terms of understanding, you know. How other companies have done it and what are the pitfalls. What's worked, and really what's the recipe for their, you know, journey, right? Which is very unique because, you know, you look at you know, being present across 30 different countries within central and eastern Europe as Werner said. And the complexities of dealing with local regulations, GDPR and all these other issues that come with it, right? And not to mention the language variation from country to country. So, you know, phenomenal story there. The journey and the journey still goes, right Werner? It's not complete yet. But Lisa, to your question, you know. When we look at, you know, the complexities of this transformation, that most modern enterprises are going through. It's not very unique, right? What is unique for a Raiffeisen Bank is - has been the preparation. But as you get into this journey of moving workloads to cloud, be it refactoring, modernizing, migrating, etc. One of the things that really is often overlooked is: "Are my applications applications and data workloads resilient on, on the, on the cloud?" Meaning are they - How is the performance? Are they just running or are they performing with high availability to meet your customers goals? Is it scalable? And are my cost in line with what I projected when I moved prep, right? Because that's one of the areas we are seeing where you know, what enterprises projected from a cost savings to what they're realizing a year and a half into the journey is a pretty big delta, right? And, and, and a lot of it is dependent on are the cloud - are the applications and the workloads cloud, designed for the cloud? Or are they designed for on-prem which you just move to the cloud. >> So Werner, it sounds like what Adithya said is a compliment to, to you guys and the team at RBI in terms of this being a template for managing complexity. Give us, Werner, your perspective in terms of modern cloud ops. What's in? What's out? What is it that customers really need to be focusing on to be successful? >> Thanks for the compliment, Lisa. And I think this is a great relationship also in the journey. Topic is, is, is a - is a complex program where a lot of things have to fit together. But it was mentioning the resilience. The course, we call it finops, security operations and so on have to come together and have to work on spot. At the end, it's also, let's say, how we are able enabling our teams and how we are ramping out the skills of our teams to deal with these multidimensional, let's say environments. And this is something what we spend a lot of time in order to prepare, but also to bring up the people on a certain level that they can operate at. Because card guard handling is, is different than before. Because beforehand you have central operations team. They do everything for you. But in this world let's say we are also putting the responsibility of the run component of the absent to the - in the tribes and the application teams. And they have to do much more than before. On the other hand, we have first central rules. We have monitoring functions. We have support functions on that in order to best support them in their journey. So this is a hybrid between, let's say, what the teams have to do with the responsibility in the teams, but also with the central functions which are supporting them. And everything have to work together and goes hand in - right, to go hand-in-hand. >> Yeah. Yeah. And if, if I could just add Lisa really quick and and Werner hit the nail on the head, right? Because you cannot look at cloud operation the way we have traditionally looked at managed services. That's the key thing, right? You cannot, you know, traditional managed services you had L1, L2, L3 and then it goes into some sort of a vacuum and then all of a sudden somebody calls you at some point, right? >> Werner: Exactly. >> And it really has flipped, right? To, to Werner's point. And Werner hit that name on the head because you really have to understand. Bring an engineering led approach to make sure that the problems, you know, when you see an issue that you have some level of automation in terms of problem isolation. And then the problem is routed the right individual ie the application engineering team or the data engineering team for resolution in a rapid manner. Right? I think that the key - >> Yes. A very important point with that is said, yeah. So you cannot traditional transport let's say, the operation model what you have now into the cloud because this will not work, yeah. And finally at the end you will not benefit on the technology possibilities there. So super important point. My vision in the cloud and this is also something what we are working on is a sort of zero-ops environment, yeah? Because we're ultimately dealing with the automatization technologies and so on, you can that much - to much more compared to the traditional environment and the benefit of the cloud is: You can test it. You can give it feedback when it is not working, yeah? So it's a completely different operating model. What we try to establish in the cloud environment. >> So really what this seems like guys is is quite a delicate balance that you're solving for. Not the only delicate balance but Werner sticking with you. Talk to us about some of the challenges that you've had around cloud cost management in particular. Help us understand that. >> Thanks for the question. So in principle, we are doing very well on the cost side, surprisingly. And we also started the cloud journey that is said this is not the cost case. Because as I said before, let's say one of the pillars in the strategy strategy was the enablement of technology to the benefit of customer solutions to be adaptive, to be faster. But at the end it turned out that let's say with giving the responsibility of the operation to the dedicated team, they found they - they were working much closer to the cost, and let's say monitoring the cost, then we headed into traditional environments, yeah? I also saw some examples in the group where sort of gamification of the cost were going on. To say who can save more To say who can save more and make more much more out of that what you have in the cloud. And at the end we see that in minimum the cost are balance to the traditional environments in the data centers. But we also saw that let's say, the cost were brought down much more than before. So at the beginning we were relative conservative with the assumptions, yeah? But it turns out that we are really getting the benefit. The things are getting faster and also the costs are going down. And we see this in real cases. >> Yeah. And, and, and Lisa, if I could add something really quick, right? Because - You know, there's been a mad rush to the cloud, right? Everybody kind of, it was, you know, the buzz the buzz was let's get to the cloud. We'll start to realize all these savings. And all of a sudden, everything kind of magically gets better, right? And what we have seen is also, you know, companies or customers or enterprises that have started this journey about 5, 6 years ago and are about, you know, a few years into it. What we are realizing is the cloud costs have increased significantly to what their projections were early on. And the way they're trying to address the cloud cost is by creating a FinOps organization that's looking at, you know, the cost of cloud from a structure standpoint and support as a reactive measure. Saying, "Hey if we move from Azure or one provider to another is there any benefit? If we move certain applications from the cloud back to on-prem, is there any benefit?" When in fact, one of the things that we have noticed really is: The problem needs to shift left to the engineering teams. Because if you are designing the applications and the systems the right way to begin with, then you can manage the data cost issues or the cost overruns, right? So you design for the cloud as opposed to designing and then looking at how do we optimize cloud. >> So Adithya, you talked about the RBI use case as really kind of a template but also some of the challenges with respect to hybrid and multi-cloud are kind of like a chicken and egg scenario. Talk to us kind of like overall about how Hitachi is really helping customers address these challenges and maximize the benefits to get the flexibility to get the agility so that they can deliver what their end user customers are expecting. >> Yeah, yeah. So, so one of the things we are doing, Lisa, when we work with customers, is really trying to understand, you know, look at their entire portfolio of applications, right? And, and look at what the intent of the applications is between customer facing, external customer, internal customer, high availability, production, etc., right? And then we go through a methodology called E3 which is envision, enable and execute. Which is really envision what the end stage should be regardless of what the environment is, right? And then we enable, which is really kind of go through a proof of value to move a few workloads, to modernize, rearchitect, replatform, etc. And look at the benefit of that application on its destination. If it's a cloud - if it's a cloud service provider or if it's another data center, whatever it may be, right? And finally, you know, once we've proven the value and the benefit and and say and kind of monetize the, you know realize the value of it from an agility, from a cost, from security and resilience, etc. Then we go through the execution, which was look we look at the entire portfolio, the entire landscape. And we go through a very disciplined manner working with our customers to roadmap it. And then we execute in a very deliberate manner where you can see value every 2-3 months. Because gone the days when you can do things as a science project that took 2-3 years, right? We, we - Everyone wants to see value, want to see - wants to see progress, and most importantly we want to see cost benefit and agility sooner than later. >> Those are incredibly important outcomes. You guys have done a great job explaining what you're doing together. This sounds like a great relationship. All right, so my last question to both of you is: "If I'm a customer and I'm planning a cloud transformation for my company, what are the two things you want me to remember and consider as I plan this? Werner, we'll start with you. >> I would pick up two things, yeah? The first one is: When you are organizing your company in HR way, then cloud is the HR technology for the HR transformation. Because HR teams needs HR technology. And the second important thing is, what I would say is: Cloud is a large scale and fast moving technology enabler to the company. So if your company is going forward to say: Technology is their enabler tool from a future business then cloud can support this journey. >> Excellent. I'm going to walk away with those. And Adithya, same question to you. I'm a, I'm a customer. I'm at an organization. I'm planning a cloud transformation. Top two things you want me to walk away with. >> Yeah. And I think Werner kind of actually touched on that in the second one, which is: it's not a tech, just an IT or a technology initiative. It is a business initiative, right? Because ultimately what you do from this cloud journey should drive, you know, should lead into business transformation or help your business grow top line or drive margin expansion, etc. So couple of things I would say, right? One is, you know, get Being and prioritize. Work with your business owners, with, you know with the cross-functional team not just the technology team. That's one. The second thing is: as the technology team or the IT team shepherds this journey, you know, keep everyone informed and engaged as you go through this journey. Because as you go through moving workloads modernizing workload, there is an impact to, you know receivables through omnichannel experiences the way customers interact and transact with you, right? And that comes with making making sure your businesses are aware your business stakeholders are aware. So in turn the end customers are aware. So you know, it's not a one and done from an engagement, it's a journey. And bring in the right experts. Talk to people who've done it, done this before, who have kind of stepped in all the pitfalls so you don't have to, right? That's the key. >> That's great advice. That's great advice for anything in life, I think. You talk about the collaboration, the importance of the business and the technology folks coming together. It really has to be - It's a delicate balance as we said before but it really has to be a holistic collaborative approach. Guys, thank you so much for joining me talking through what HitachiVantara and RBI are doing together. It sounds like you're well into this journey and it sounds like it's going quite well. We thank you so much for your insights and your perspectives. >> Thank you, Lisa. Werner, thank you again. >> Good stuff guys. For my guests, I'm Lisa Martin. Thank you so much for watching our event: Build Your Cloud Center of Excellence. (upbeat music)

(upbeat music) >> Hey everyone, welcome to this event: Build Your Cloud Center of Excellence. I'm your host, Lisa Martin, and I have two guests here with me today to talk about the hybrid cloud, the multi-cloud trends, and specifically the complexity. While we know these trends provide agility and flexibility for customers, they also bring in complexity. And this session is going to focus on exploring that with RBI and HitachiVantara. Please welcome my guests, Adithya Sastry the SVP of Digital Solutions at HitachiVantara and Werner Mayer, head of group core IT and head of group data at RBI International. Guys, welcome to the program. >> Thank you Lisa. Werner, nice to see you again. >> Great to see you both. >> And Werner, we're going to start with you. Talk about RBI. Tell the audience a little bit about what the business is and then we're going to get into your cloud transformation journey over the last couple of years. >> Yes, thank you. So Raiffeisen Bank International is international working banking groups. So our core markets are Central Eastern European, Central Eastern Europe and Austria. And we are serving around 50 million clients in this market. So we active in 13 markets. >> Got it. Talk to me, Werner about the cloud transformation journey that RBI has been on over the last couple of years and some of the complexities that you've experienced as you've launched it. >> Sure. Thank you for the question. So in 2020, we decided that we have to renew our IT strategy. And the aim of the strategy was to change the organization in a way that it can react and adapt fast to the future challenges. So one of the important pillars for us was that we are adapting fast also for new technologies. And this was core pillar in our strategy. So we're searching for technologies which are fit in to our HR transformation. And we found that the cloud and the public cloud environment fits to this venture. So we tested that. We are building up also the competent centers for that and also established the group cloud platform for that. Because our invoice to onboard our international group with the 13 units to this group cloud platform. So that means we have a lot to do to hardening the platforms in terms of security to put in. We have standard for that. We have to introduce large scale programs to train hundreds of engineers. We tested the approach, We convinced the top management and we implemented this, this program. So one of the highlights was, of course, also the the safeguarding of the Ukraine, let's say, banking environment. So we had to lift and shift the complete bank in three months. And it shows that let's say our platforms works. And let's say the approach is proven that we can scale it over the group. >> That's a big challenge. A lot of complexity especially with some of the global things going on. Adithya, these challenges are, are not unique to RBI. A lot of your customers are facing challenges with complexity around cloud management, cloud ops. What can you unpack was the real issue is here? >> Yeah, Lisa, absolutely. And you know, before I answer your question, I do want to, you know, just say a couple of things about Raiffeisen Bank. And you know, we've had the pleasure of working with them for about a year, a little bit more than a year now. And, and, and the way they approach the cloud transformation journey is - should be a template for a lot of the organizations in terms of the preparation in terms of understanding, you know. How other companies have done it and what are the pitfalls. What's worked, and really what's the recipe for their, you know, journey, right? Which is very unique because, you know, you look at you know, being present across 30 different countries within central and eastern Europe as Werner said. And the complexities of dealing with local regulations, GDPR and all these other issues that come with it, right? And not to mention the language variation from country to country. So, you know, phenomenal story there. The journey and the journey still goes, right Werner? It's not complete yet. But Lisa, to your question, you know. When we look at, you know, the complexities of this transformation, that most modern enterprises are going through. It's not very unique, right? What is unique for a Raiffeisen Bank is - has been the preparation. But as you get into this journey of moving workloads to cloud, be it refactoring, modernizing, migrating, etc. One of the things that really is often overlooked is: "Are my applications applications and data workloads resilient on, on the, on the cloud?" Meaning are they - How is the performance? Are they just running or are they performing with high availability to meet your customers goals? Is it scalable? And are my cost in line with what I projected when I moved prep, right? Because that's one of the areas we are seeing where you know, what enterprises projected from a cost savings to what they're realizing a year and a half into the journey is a pretty big delta, right? And, and, and a lot of it is dependent on are the cloud - are the applications and the workloads cloud, designed for the cloud? Or are they designed for on-prem which you just move to the cloud. >> So Werner, it sounds like what Adithya said is a compliment to, to you guys and the team at RBI in terms of this being a template for managing complexity. Give us, Werner, your perspective in terms of modern cloud ops. What's in? What's out? What is it that customers really need to be focusing on to be successful? >> Thanks for the compliment, Lisa. And I think this is a great relationship also in the journey. Topic is, is, is a - is a complex program where a lot of things have to fit together. But it was mentioning the resilience. The course, we call it finops, security operations and so on have to come together and have to work on spot. At the end, it's also, let's say, how we are able enabling our teams and how we are ramping out the skills of our teams to deal with these multidimensional, let's say environments. And this is something what we spend a lot of time in order to prepare, but also to bring up the people on a certain level that they can operate at. Because card guard handling is, is different than before. Because beforehand you have central operations team. They do everything for you. But in this world let's say we are also putting the responsibility of the run component of the absent to the - in the tribes and the application teams. And they have to do much more than before. On the other hand, we have first central rules. We have monitoring functions. We have support functions on that in order to best support them in their journey. So this is a hybrid between, let's say, what the teams have to do with the responsibility in the teams, but also with the central functions which are supporting them. And everything have to work together and goes hand in - right, to go hand-in-hand. >> Yeah. Yeah. And if, if I could just add Lisa really quick and and Werner hit the nail on the head, right? Because you cannot look at cloud operation the way we have traditionally looked at managed services. That's the key thing, right? You cannot, you know, traditional managed services you had L1, L2, L3 and then it goes into some sort of a vacuum and then all of a sudden somebody calls you at some point, right? >> Werner: Exactly. >> And it really has flipped, right? To, to Werner's point. And Werner hit that name on the head because you really have to understand. Bring an engineering led approach to make sure that the problems, you know, when you see an issue that you have some level of automation in terms of problem isolation. And then the problem is routed the right individual ie the application engineering team or the data engineering team for resolution in a rapid manner. Right? I think that the key - >> Yes. A very important point with that is said, yeah. So you cannot traditional transport let's say, the operation model what you have now into the cloud because this will not work, yeah. And finally at the end you will not benefit on the technology possibilities there. So super important point. My vision in the cloud and this is also something what we are working on is a sort of zero-ops environment, yeah? Because we're ultimately dealing with the automatization technologies and so on, you can that much - to much more compared to the traditional environment and the benefit of the cloud is: You can test it. You can give it feedback when it is not working, yeah? So it's a completely different operating model. What we try to establish in the cloud environment. >> So really what this seems like guys is is quite a delicate balance that you're solving for. Not the only delicate balance but Werner sticking with you. Talk to us about some of the challenges that you've had around cloud cost management in particular. Help us understand that. >> Thanks for the question. So in principle, we are doing very well on the cost side, surprisingly. And we also started the cloud journey that is said this is not the cost case. Because as I said before, let's say one of the pillars in the strategy strategy was the enablement of technology to the benefit of customer solutions to be adaptive, to be faster. But at the end it turned out that let's say with giving the responsibility of the operation to the dedicated team, they found they - they were working much closer to the cost, and let's say monitoring the cost, then we headed into traditional environments, yeah? I also saw some examples in the group where sort of gamification of the cost were going on. To say who can save more To say who can save more and make more much more out of that what you have in the cloud. And at the end we see that in minimum the cost are balance to the traditional environments in the data centers. But we also saw that let's say, the cost were brought down much more than before. So at the beginning we were relative conservative with the assumptions, yeah? But it turns out that we are really getting the benefit. The things are getting faster and also the costs are going down. And we see this in real cases. >> Yeah. And, and, and Lisa, if I could add something really quick, right? Because - You know, there's been a mad rush to the cloud, right? Everybody kind of, it was, you know, the buzz the buzz was let's get to the cloud. We'll start to realize all these savings. And all of a sudden, everything kind of magically gets better, right? And what we have seen is also, you know, companies or customers or enterprises that have started this journey about 5, 6 years ago and are about, you know, a few years into it. What we are realizing is the cloud costs have increased significantly to what their projections were early on. And the way they're trying to address the cloud cost is by creating a FinOps organization that's looking at, you know, the cost of cloud from a structure standpoint and support as a reactive measure. Saying, "Hey if we move from Azure or one provider to another is there any benefit? If we move certain applications from the cloud back to on-prem, is there any benefit?" When in fact, one of the things that we have noticed really is: The problem needs to shift left to the engineering teams. Because if you are designing the applications and the systems the right way to begin with, then you can manage the data cost issues or the cost overruns, right? So you design for the cloud as opposed to designing and then looking at how do we optimize cloud. >> So Adithya, you talked about the RBI use case as really kind of a template but also some of the challenges with respect to hybrid and multi-cloud are kind of like a chicken and egg scenario. Talk to us kind of like overall about how Hitachi is really helping customers address these challenges and maximize the benefits to get the flexibility to get the agility so that they can deliver what their end user customers are expecting. >> Yeah, yeah. So, so one of the things we are doing, Lisa, when we work with customers, is really trying to understand, you know, look at their entire portfolio of applications, right? And, and look at what the intent of the applications is between customer facing, external customer, internal customer, high availability, production, etc., right? And then we go through a methodology called E3 which is envision, enable and execute. Which is really envision what the end stage should be regardless of what the environment is, right? And then we enable, which is really kind of go through a proof of value to move a few workloads, to modernize, rearchitect, replatform, etc. And look at the benefit of that application on its destination. If it's a cloud - if it's a cloud service provider or if it's another data center, whatever it may be, right? And finally, you know, once we've proven the value and the benefit and and say and kind of monetize the, you know realize the value of it from an agility, from a cost, from security and resilience, etc. Then we go through the execution, which was look we look at the entire portfolio, the entire landscape. And we go through a very disciplined manner working with our customers to roadmap it. And then we execute in a very deliberate manner where you can see value every 2-3 months. Because gone the days when you can do things as a science project that took 2-3 years, right? We, we - Everyone wants to see value, want to see - wants to see progress, and most importantly we want to see cost benefit and agility sooner than later. >> Those are incredibly important outcomes. You guys have done a great job explaining what you're doing together. This sounds like a great relationship. All right, so my last question to both of you is: "If I'm a customer and I'm planning a cloud transformation for my company, what are the two things you want me to remember and consider as I plan this? Werner, we'll start with you. >> I would pick up two things, yeah? The first one is: When you are organizing your company in HR way, then cloud is the HR technology for the HR transformation. Because HR teams needs HR technology. And the second important thing is, what I would say is: Cloud is a large scale and fast moving technology enabler to the company. So if your company is going forward to say: Technology is their enabler tool from a future business then cloud can support this journey. >> Excellent. I'm going to walk away with those. And Adithya, same question to you. I'm a, I'm a customer. I'm at an organization. I'm planning a cloud transformation. Top two things you want me to walk away with. >> Yeah. And I think Werner kind of actually touched on that in the second one, which is: it's not a tech, just an IT or a technology initiative. It is a business initiative, right? Because ultimately what you do from this cloud journey should drive, you know, should lead into business transformation or help your business grow top line or drive margin expansion, etc. So couple of things I would say, right? One is, you know, get Being and prioritize. Work with your business owners, with, you know with the cross-functional team not just the technology team. That's one. The second thing is: as the technology team or the IT team shepherds this journey, you know, keep everyone informed and engaged as you go through this journey. Because as you go through moving workloads modernizing workload, there is an impact to, you know receivables through omnichannel experiences the way customers interact and transact with you, right? And that comes with making making sure your businesses are aware your business stakeholders are aware. So in turn the end customers are aware. So you know, it's not a one and done from an engagement, it's a journey. And bring in the right experts. Talk to people who've done it, done this before, who have kind of stepped in all the pitfalls so you don't have to, right? That's the key. >> That's great advice. That's great advice for anything in life, I think. You talk about the collaboration, the importance of the business and the technology folks coming together. It really has to be - It's a delicate balance as we said before but it really has to be a holistic collaborative approach. Guys, thank you so much for joining me talking through what HitachiVantara and RBI are doing together. It sounds like you're well into this journey and it sounds like it's going quite well. We thank you so much for your insights and your perspectives. >> Thank you, Lisa. Werner, thank you again. >> Good stuff guys. For my guests, I'm Lisa Martin. Thank you so much for watching our event: Build Your Cloud Center of Excellence. (upbeat music)

(upbeat music) >> Back the cube here. I'm John Furrier with the cube. Thanks Adam in the studio. We've got two entrepreneurs here. Co-founders of LastMileXchange, Andrew Hoskin and James Grant. Guys, thanks for coming on the cube, >> John. Good to be here. >> Love to get the entrepreneur, both co-founders making it happen. I mean, the pandemic was either a tailwind or a headwind for companies and certainly the internet didn't break. Everything worked out great. So, let's just jump in, why don't we get into some of the questions. What does LMX do? Who are you guys? Take a quick minute to explain what you guys do. >> Sure. So, we're a software provider. We have a cloud-based SAS platform, which effectively it's a bit like a Skyscanner or an Expedia for networks. Carriers need to buy and sell networks from each other and we help them do that. And we have been in the cloud since day one. And so, that's what we do while we're here and it's a good place for us to tell you about it. >> I got it. I got to ask you, because one of the things being entrepreneur, you've got to read the tea leaves. One of the secrets of being a co-founder and doing anything entrepreneurial these days is you got to see the future, but then you've got to come back to the present and convince everybody, what's going on. >> Entrepreneurs: Yeah. >> What is the core value proposition? What's the day in the life of a conversation? I mean you're talking to Martians now, like, huh? What's the public cloud it's like, is it like, isn't it just the internet? It's changing. What's the value proposition? What's the conversation like? >> So, the value position for us is that we, you know, we work with our customers to accelerate the sales cycle through cloud based services. So, a lot of our customers are global tier one carriers. So, we're looking to automate their connectivity pricing, and we do that via a cloud-based solution. So it is vital to us. And particularly with having customers all across the globe, being able to sort of deploy cloud-based services makes life much easier. >> I got to ask you, one of the things that we love about cloud is the agilities. >> Yeah. >> Can you talk about the impact of what you guys are offering for the agility side. What's the impact of the consumer, the application developer, what's the impact? >> Clouds have a big play for us, big impact for our customers. So we provide our solution effectively, almost a plug and play for them. So, we do quoting really, really well. You want to know where a network is, you want to know the connectivity, we'll sort that out for you, and we can give you a solution that they can plug into their systems really quickly. In terms of, for us, when we first started, we had servers in data centers and managing software on that, but we moved to Amazon pretty early. And what we now have is, we can spin up a new customer environment in a day, which you know, from previously two, three weeks. So, cloud has been transformational for us and hopefully for our customers as well. >> And you guys target mainly carriers? >> Very much so, yeah. We're very much in the big carrier Telco space. The people that provide the fabric upon which all of this sits. >> Yeah. And then by the way, it's magic and this, it's robust. It's what we need, utilities, it's important. Last mile, obviously, as we all, some people look at it and say, go back decades, rug ban, you know, last mile is always that last nut to crack. 5G's here, the mobile sector is looking at massive growth. You're starting to see the cloud providers recognize that the edge is just another network connection. >> Yeah, absolutely. >> How do you guys see that evolving? What's going on? How do you see that affecting your business, the customers on the market? >> Well, so network, I mean, access is all about getting onto the network, whether you're talking cloud or whatever. So, if you can't get into the network, cloud is nothing. If you can't sort of back haul your 5G, you're stuck. So, what we're seeing is, even with 5G, as it rolls out, as people look to densify their networks, they still need to get all that voice stuff, all that data traffic onto fiber. So, we're seeing a lot of interest there still in knowing where connectivity options are, knowing where the network is. With James also, I mean, that other aspect of access, 10 years ago was all about fiber. But you were just telling me before about how increasingly carriers are using 5G as effectively a router in a box, ship it in by a DPD or FedEx out to a customer. >> Yeah. So typically we'll think about mobile as connecting your mobile phone, but now we're looking at sort of, mobile connecting buildings. And one of the key challenges when you're connecting a building with mobile is what the actual connectivity within the building is. So, often we will see mobile maps that show you that sort of connectivity at sort of, the outside level. But of course, you're actually going to have your infrastructure in the building. So, you need to know what the straight signal strength is there. So, we're actually working with a partner at the moment so that we can identify within a building, what the quality of the signal is. >> I mean, that's class, if you think about like, most people think of, oh, it just drops to the end point and then you've got more network behind it, wireless. You got now to work at home dynamics, IOT devices. So, you guys have the buy-sell side of things going on, you got the carriers buying and selling there. >> Entrepreneurs: Yeah, absolutely. >> And then, SD WAN is a huge market, >> Andrew: Absolutely. >> That's growing and, as well. >> And all of that relies on access. Do you know what I mean? Like, you can talk 5G, you can talk IOT. And of course, those are the exciting, sexy things in the industry. But underpinning all of that is a network. And you mentioned the word before and it's right, utility, you know, maybe it's not the sexy side of things, but you've got to have it, otherwise, nothing else works. >> You know, one of the things we do a lot of cloud cover, we cover all of Amazon shows here coming into Telco, the Telco, digital revolution that's going on here, you can see it. And some people aren't ready for it. Almost like, reminds me of the mainframe days back when I was growing up in college, it's like, oh, I'm not, I don't want to do the mainframe. I'm the new guy, I'm the young kid. I love this, a PC and mini computers. Here, it's the same thing. It's kind of like, okay, I see the cloud, but when you have infrastructure as code, >> Yeah. >> Everything gets fuzzy. >> Yeah. >> I mean, now you're talking about programmability. So, that edge at the application level, some say it's going to be a massive innovation enabler, which is going to change that infrastructure's code, which means that guys like you guys got to be able to provide programmable routes, programmable and, >> Yeah. And APR is our, and the programmability of the network, the whole interplay from whether it's quoting, whether it's ordering, whether it's delivering services, whether it's kind of somebody going into somewhere and saying, "I'd like a, a hundred gig into this building", pressing a button and 15 minutes later, everything rolls together to turn it up, is where the whole industry is going. >> Let's take that for a second. >> Sure. >> Just a mind blowing scenario right there. Sounds simple. >> Yeah. >> Compared to where we were just 15 years ago. >> Yeah. >> That scenario didn't exist. >> No. >> And it's hard. It's not trivial. >> No. >> It's not non-trivial. All right. So what's this mean for customers? Are they like buying this level now, like, are they like, where are they on the spectrum of, you know, buying and the progression of operationalizing their business to be fully robust, network end to end, visibility on workloads to network? >> I would say it often depends where the customer is. So, obviously we deal with global customers and that's one of our big selling points is that, you know, a lot of people are focusing on the US, the Western European market, you know, and the connectivity challenges that they're trying to solve there. Our customers have global customers who are looking for connectivity all throughout world. And often there'll be things like mining companies who don't have fiber going into them. And so, we need to be able to work with our customers and their suppliers to be able to automate everything, because you can only fully quote a network when you've got all the locations back. And if you're waiting for information coming back from Africa or from the former CIS, then you know, you're going to have a problem. And we're working with companies in Africa and Russia, Kazakhstan, at the moment to help them automate everything. >> You know what's interesting, I just, my mind just goes nuts here when thinking about what you guys do, because as people start rolling their own with applications, they're going to need to have this programmability, like almost on demand, they're going to need to have, I want to do a digital TV network, I want to provision something or something's hybrid or at the edge. >> You've got a football game, or you've got something like this where you need capacity, you need it quickly. You need it for an event. >> Yeah, exactly. And 5G's perfect. I mean, how many times we've all been at a soccer game or a football game. It's like, I got bars but I have no back haul. Like we all been there. >> Yeah. >> Why, oh? >> Saturated the network and everyone's doing the same thing. >> The radios working, the back haul's choking. I mean, this is real. >> Absolutely. >> How does, does 5G solve that? I mean, where does that get, how does that get solved? I mean, is it going to be ubiquitous? Truly 5G going to make us all work better? I mean, certainly for the end use of 5G is it provides speed, it provides capacity. And also for the operators it provides being able to get more people onto it. And so, and 5G is not my core strength, but it absolutely will be transformative. What I can comment on is, like you say, for an event like this or the football or anything, the Euros, it ultimately goes into a pipe. So, you've got to make sure that you've got to have the right connectivity there and the right capacity there, from the user's phone, through the towers, all the way into the network, all the way to the data center and back again. So the edge, everything, has to play together to do that, and probably, rolling it out quickly and making sure it's agile and making sure it's fast and making sure it's quick and reliable. That's what needs to all work together. I liked how you said you know, the Expedia of the networks. >> Andrew: Yeah. >> That immediately in my mind says, okay, ease of use. >> Andrew: Yeah. >> From consumption standpoint, what's the next level of growth for you guys? I'm almost imagining is programmability or cloudifying or amplifying it, make it rain. >> Yeah, certainly we are going to continue to push into, yeah, effectively digital transformation in fact, across telecoms is happening. You would think there would be a lot further ahead than it is. It's not. There are a lot of people still quoting, ordering manually. So, we're very much part of that, but certainly the ordering and the provisioning, like we've mentioned, that's a big part, but for the industry, and we're going to hopefully be part of that, or we expect to be part of that. So that's, and making sure that connectivity is there when you need it. You know, I'm here, what's there? A bit like flights, I'd like to fly to New York. Who can do it, how much will it cost? I'll buy that one please. And that's what networks should be as well. >> James, what's your vision on how the customers are progressing in their mindset? Obviously, you've got the blocking and tackling to do, you're in the market. Where are they going with the use case and the application? >> The customers are getting to the stage where they're expecting to be able to go into a portal and turn up services. So, as with many things that we're seeing throughout life today, you can go into an app, you can press a couple of buttons and you can, you can order something. So, that's what they're expecting is to be able to just go and say, I need a hundred mg here, press a few buttons. And in 10 minutes time, the circuit's not only quoted, but it's provisioned. At the moment, there's this sort of a digital divide between those that have the digitization in place and those that don't. And that's the sort of the key that we're trying to sort of help the industry with is the sort of the, the outliers and, and also the main carriers to make sure that it's not a sort of, a digital haves and a digital have-nots. >> I was just going to say that. So, if you have the digital haves and have-nots, is that a function of them just not being operationalized in their digitization? Or is it they're not set up for it or they don't have you guys? What's that have-not side of it? How do they become the haves? >> One of the biggest challenges is actually around the sort of, identifying the connectivity at a particular location. So, in some countries it's very easy to do, like the US, UK, Netherlands. We have nice sort of standard address formatting, and you can identify a building at roof level. And when it comes to turning up connectivity straight away, you want to make sure that you turn up the connectivity to the right building. And that's one of the challenges that we're seeing throughout sort of, some of the Eastern European and the LatAm, the Asian and the African markets. >> I mean, we saw what happened with Amazon instances. You've got spot instances, you get reserved instances, you're starting to see that mindset. That's a SAS mindset. >> Yeah. >> That's kind of where things are going. Is that, you guys see the same thing here or is it different? >> Yeah. Well, certainly at the enterprise space, they tend to make decisions over a longer scale. So there, maybe not so much that you sign contracts in a year's term et cetera, but yeah, certainly as a provider, a SAS provider, using all those things, the ability to to tune your expenses, tune your costs, even your resource, you know, you're turning up servers by the hour, by the minute is a big thing. And it takes a mindset change for us and our customers. >> If you don't mind me asking, how long have you guys been doing business as co-founders, when did it start? What was the guiding principle? How do you guys look back now? >> James and I met working for Verizon many years ago. You might've heard of them. And, we sort of did what we do now, in as much as James ran the commercial side of things, I ran the software side of things and we saw that connectivity was a universal problem. And so we saw our opportunity. We went out, we started LastMileXchange. We pivoted once or twice, still in the same space, but we eventually realized that where we are now was what the industry needed. And that's where we've been pushing now for quite a few years. >> I want to give you guys a lot of credit and a lot of props, congratulations. I think, you know, the digital divide has been a broadband challenge for many, many years and decades. Now, you've got that urban divide where people don't have access. And I heard stories during the pandemic that people had access in the region, but couldn't get it to the home, affordability, access, devices. These are new issues, the digital divide, they have connectivity options. >> Andrew: Yeah. >> But it's not really clear yet. So, you're starting to see a lot more of that going on. Of course, the rural areas. >> Andrew: Yeah. >> I live out in the countryside on a farm. So, I'm quite used to their challenges of connectivity. You know, when I first moved into my house, I ended up having to get to way satellite broadband and things have improved now. But when we're talking about 5G, you have people in London, they have 5G. 5G is something that I'm not going to see for three, four years probably. >> Globally, it'll democratize access because like we were saying, we're sitting in an enterprise. You can send out a rooter or a router with a SIM card in it. I mean, you can give a kid a mobile phone in the middle of, you know, Kenya, and he can have access to the world through the internet. So, you know, that increased capacity, that increased densification of networks. Okay, they're not all going to be on 5G today. James hasn't got 5G and he only lives 30 minutes out of London. But 3G, 4G, I think the gentlemen on one of the keynotes was talking there about 3G Plus. You know, effectively, that's going to roll out. The 5G's are going to be in New Yorks and London, but, >> Like, it's going to be bring your own G to your house soon. And I think this space ops is going to be great. And I think overall, just overall, the challenges and the topologies, you're going to start to see diversity in the network topology, and actually it's going to explode. >> Andrew: Yeah, absolutely. Absolutely. >> Going to be super exciting. Well, again, I think you guys are under something big. I think this idea of sasifying, making things programmable, infrastructure as code is going to be pretty big. So, thanks for coming on. And what's your take, real quick, of Cloud City. >> It's been great. We've just walked in. We both said, as we came in, we came in yesterday to set up and we were really blown away and the rest of our team arrived today and they were very impressed as well. I was going to say Telco D on the team, have done a really impressive job. >> I think you have to come here and see it to believe it because when we walked in, it was just like, this place is stunning. >> Awesome. Well that's the cube coverage, we're rocking and rolling here. We're going back to the studio to see Adam and the team. Back to you.

>> Narrator: Live, from San Francisco, celebrating 10 years of high-tech coverage, It's theCUBE! Covering VMworld 2019. Brought to you by VMware, and its ecosystem partners. >> And, welcome back here on theCUBE, we're at the Moscone Center here at downtown San Francisco. Gorgeous day outside, by the way. Picture perfect day. Chamber of Commerce weather, but a lot of big news happening inside here for VMworld 2019, along with John Troyer. I'm John Walls, we're joined by Pierluca Chiodelli, who's the Vice President of Product Management at Dell EMC. And, Pierluca, good to see you, Sir. >> Thank you, it's awesome to be here. >> Great, thanks for being here. And Muneyb Minhazuddin, whose the VP of solutions product marketing at VMware. And Muneyb, I know you're right just hot off the presentation stage. >> Yes I am. >> Catch your breath, it's all going to be fine. How was your audience? I'm sure standing remotely. >> Yeah, it was thirteen hundred plus >> Excellent, yeah. Been a big week, already. >> Of course it has, yeah. >> For you and your team. So, first off, let me just, let's step back, talk about the vibe of the show, the theme of the show we saw Pat on the stage. >> Muneyb: Perfect. >> About an hour and a half this morning, just your thoughts about day one and the big announcements that VMware's been making. >> It's been a great week, and it's actually been a great approaching week. As you know, on Thursday we announced intent and acquire both Pivotal and Carbon Black for close to about $5,000,000,000. So, that's, kind of a big announcement by itself, and then how do you kind of bring in and keep day one where you're not too focused on those two, but get the narrative of VMworld across. And really, you know, where we have, you know, CUBE has been with us on this journey for a long time. >> Right. >> We've seen that data center shift into kind of two tangents. One is, you know, workloads into data center break out into public clouds. Second, rerouting into cloud native applications. And, if you've seen our strategy wall when that was kind of the key messages. Hey, we're embracing both the modern app development, the focus on Kubernetes and Tanzoo announcement, was all about to say, "VMware platforms ready "for the breakout of both tangents." First, Cloud Native, we've got Kubernetes, we're bringing it right into vSphere, so that everybody in the audience can support it. Second, the breadth of our cloud everywhere, right, so, we've gone from Amazon to IBM to Google to Ajour. So, it'll give you the infrastructure for your workloads to be your choice. Modernize or migrate. (chuckles) That was a key message for us to kind of land today. For a lot of our audience who are kind of stuck in that same piece of, "What am I doing with my workloads? "What is that platform I got to build on?" And, you know, the key foundational platform being VMware Cloud Foundation. Right, that was our strategy, and I think last year we called out VMware Cloud Foundation in Pat's keynote, because I wrote it 44 times. (laughs) (group laughter) We didn't do it that many times, this time. We only said that's the platform that lands in Amazon, GCP, Ajour, IBM, and 4,200, you know, cloud provider partners. That gives you really that public cloud extension. The second part being modern apps, Kubernetes is a new, kind of, modern app development platform, vSphere is embedded into that project pacific and the whole Tanzoo announcement, right? So, really, a powerful message, what do you think? Was that successfully landed? >> I think so. John, do you feel good about what you heard today? >> Yeah, absolutely, I think VCF is super interesting. I'm also kind of, so there was an announcement today also about the Dell Technologies Cloud Validated Designs for using VCF. So, VCF the layer, which is kind of the VMware stack with some extra magic in it, that can be in, can make a private hybrid cloud, you know, everywhere. So, talk to us a little bit about Dell Technologies Cloud. As I call it, "DTC." The, it's a lot, there's a lot of stuff in that as well, so, but we have two very complicated solutions stacks that are, we're talking about now, so. >> Yeah, absolutely. >> Can you talk a little bit about the validated design and what came out of that? >> Absolutely, so before we go into the validated design, I think it's very important as Muneyb said. When we think about the Dell Technology Cloud, really, it's a component of the best (murmurs) technology from our storage, networking, and also compute, but we did the VMware VCS on top. So, we work very closely with VMware, and today we are announcing today the Cloud Validated Design. As we announce at the Dell Technology World in May, we said Dell Technology Cloud is this, now we want to tell to the people, how you can easily deploy this. What is make this tangible? So, what we are doing today is rapid time to value. We did design and pretested configuration, that we put in Dell Technologies Cloud Validated Design, as we said. The other important things as Muneyb said, right? It's... And, I heard this also from theCUBE. There was a debate with Stu and other people about, what is the Cloud? How I deploy the Cloud? When we think about Dell Technologies we speak with different peoples, and two set of peoples. One is the app, right? The Cloud app, all the app people that, they want to build have all the automation, DevOps operation and all these things. But, behind those people, there's still an infrastructure. So, we are speaking on both things. So, it's very important this paradigm is there, where you can have people that they can consume the technology, and understand how to build the infrastructure to be automated, and build that automation for the Cloud. So, that's what is the Dell Technologies Font Validation Design. Right. So, one of the biggest things here that we announced, is not only the Cloud Validation Design. It's the first one but also the ability to have compute, storage and network together, and also use it primary storage as a primary citizen of the VCF. So, we should talk about that later but that's-- >> Absolutely, and I think to catch onto that, you know, talking about the applications et cetera, you know, again, in the evolution of Cloud, and we've been on the journey for 10 years is, we've had, the first few years of the Cloud journey was, felt a little like a one way street, which was, kind of meant where people were shutting down data centers and going to all these public cloud providers, was always a one-way street. Now, VMware, and if you followed us closely, we had a service call VMware, you know VCHS, which is VMware Hybrid Cloud Service before the vCloud Air and then we came out with this solution, right? The idea was, we thought there's going to be movement back-and-forth but it wasn't the case. People were seriously shutting down and going one way. As we made all these partnerships of you know, Amazon, IBM, we started seeing, and you heard stories of IHS, Freddie Mac on stage where they take six weeks to move 100 applications one way into the Cloud, customers started asking us some questions, say, 'If it's so easy to go that way, is it also that easy to bring it back?' >> Come back! >> Right? And, that kind of lead to the whole kind of Dell partnership, Dell announcement within the Dell Cloud Foundation, you know, VMware Cloud Foundation, Dell Technologies Cloud Platform to say that, "Hey, it's actually..." There's a notion of not going from hardware-specific, you know, just high-tuned for workloads to commodity hardware in the Public Cloud. There's now a need for having common hardware platform on both on-PRAM, off-PRAM because there is a need for customers to take EC2 workloads or, you know, Ajour workloads and bring it on PRAM again. That was just a notion of how fast it is. I add that point because it is so critical to know that your hardware is performing in tuned, to perform for a high business critical applications. People forgot about them the first few phases of going to the Cloud, and now as they think about a hybrid, true hybrid Cloud nature, they want optimal performance in the software layer, in the hardware layer. You know, hence our announcement of Dell Technologies Cloud, Cloud Foundation, Validated Design. It's really supporting that customer notion. >> So, it's like this optimal, or maximized flexibility is what you're trying to give people. I mean, is that-- >> Pierluca: With the Cloud simplicity, that's really the key. >> But what drives that? I know that you have, you've, you know, whether you're on-PRAM or you're off-PRAM, you're going to decide what workload's going to go on what space on, so forth, but is some of that kind of hedging bets for future workloads because you can't predict where they're going to be done or where you want them done? Or is it just providing flexibility today, and let's not worry about tomorrow? You know, it just seems like there's a lot of runway here, if you will. >> Yeah, and I think there's no right or wrong answer. One of the big workshops I do with our customers is really kind of say have you figured out what's your three to five-year application strategy? Because again, in that first phase of that fast migration to the Public Cloud, people were just like CIOs I know, it's like, I have a cloud for strategy, what does that mean? I'm shutting down all data centers, I'm going to the Cloud. Right or wrong, and that's my Cloud First strategy. Now, what they've come to realize is not all workloads work effectively in the Cloud, right? So, they kind of like, hey, put an application strategy to say what are the most optimal applications that will get the benefit of Cloud? These are like, e-commerce retail. They have to have, you know, Black Friday, expanding elasticity. If you got no slow, mundane, you know backend processes doing batch processes of massive storage of in a bank ledger in the back end, they're not going to get that elasticity. I know what it is, I know how many, you know, batch processes I got to run. So, people are getting smarter about which ones get the benefit of, you know, modern app development, or Cloud elasticity, which ones don't really need to have that. So, we've seen best practice customers actually have a very good app strategy, three to five years, and then decide how much of my app strategy is gone to the right, you know, or gone to the left, right? It's pretty much to say, "I don't have to change." 60, 70% of my Eastern European customers, their banking ledgers are still on mainframes. They're not in a hurry to go to the Cloud, whereas, you know Fintech on the East Coast is going, "I'm going to the, I'm going to the Cloud", right? So, it's really that strategy that's, they should take the app strategy and decide what the infrastructure strategy is on the top shelf. >> I think from the storage business, we see that really clear, right? The app is definitely what is moving the things, right? It's not, people they're not thinking anymore because the transformation is in the way that you consume the infrastructure. They not thinking anymore about what I put there, but is about what app I need to run, how I build my app. So, it's the environment. And, I don't think personally I meet a lot of customer. There is not one right way or wrong way, it's an end, right? As you can see also in VCF we have Vsend, VxRail and primary storage. If you look at two years ago, we will be sitting here and say, you know, "It's only this, not the other things." When we, I been in governor conference, three years ago was like, it's all Cloud. It's reality is the world, the information technology world is always the same, where is a natural genius things. Because people, they need to have the trust, right? You cannot run your entire things on something that you don't know or you didn't prove. So, what we give here today with our technology is the flexibility. You can have a Cloud approach, but use the trusted PowerMax, for example, in conjunction with Vsend, in conjunction with the Unity. So, not all these is the proof that you can preserve your investment. But, is the proof that you can start to build those up. And, if you've seen what paths say today, then those app can live everywhere. So, you can go, you can move, it's much easier to move, and you can just trust what you're doing. >> And, you hit an important point on the move part, right? And, people are so easy, like, "Hey I moved a thousand applications in six weeks "to VMC and AWS." The fundamental notion where that was not possible before, was compute, network, storage. Like, we've been doing vSphere for a long time, you know that. And, it wasn't that easy because what used to happen is people thought, "Hey, a virtualized computer, I can move it." But, what did not happen as you moved that, was your databases, you know, your storage, rules didn't follow you into the Cloud. Your networking QOS and, you know, policies, and you know, priorities didn't follow you into the Cloud. So, that was kind of like, you know, you know, I'm an Australian, so it was a half-assed solution, right? (group laughing) So bear with my language, right. It was a half-assed solution, but really what needs to happen is your compute, your network, your storage has to all work together. And, that's where Cloud Foundation was powerful. And, what we're lighting with this Validated Designs is also that capability that your computer, or storage is one unit from a app. Once you package it and make it available in all the platforms, then that migration becomes six weeks, two weeks to move that. Because once you break it apart, it's a nightmare. There's not a lot of folks who have survived database migrations. (laughs) >> I mean maybe Pierluca, you can kind of sum us up here. This conversation's been a lot around evolution, right? And, there's also been an evolution of data center design and what to expect with that, you know, just buying things off the shelf and getting a Var and, you know, the VMAX, and we've been through this whole, and now, we've talked about VxRail, which can be part of this solution. But, can you talk, just, maybe, take us in, take us out with the, or into the future with the Dell Technologies Cloud as the idea of the Validated Design, the idea of this stack from Dell Technologies in storage et cetera, what can we expect in the near future? And, how much guidance will folks get? >> Yeah, absolutely. So, without breaking any NDA things, but this is only the first step. So, the Cloud Validated Design is just the first step where we said, 'Okay, we are tasked in this, "we putting this together." We are working very closely to also solve the entire things that VCF allow you to do first day deployment, allow you to expand the infrastructure, and allow you also to do life cycle management. For example, with the VxRail we already have the life cycle management part. We are working in way to do that also for our storage and other things. So, if you think about that then it becomes as you said, all the policy we put, like with Vworld, will be strategically in that sense, the policies can be carried over. So, then you can go to VMC, you can go to another place where the software and infrastructure can move back. So, because people can do this on PRAM, a replicate exactly but not only replicate the application, but replicate the (murmurs). What do you do on the QOS, all these key things that makes people running enterprise application, right? So that's, I think, it's very exciting moment. I think it's just the starting of this dream. >> Absolutely. >> Gentlemen, thanks for the time. >> Thank you. >> And you're all, you paint a pretty exciting future, don't ya? >> I hope so. >> So, I can't wait to look forward to even VMworld 2020? >> Wait 'til Barcelona, come on? (laughs) >> All right, well I'm not making that road trip, so unfortunately-- >> We going to more out there. >> But, Barcelona's going to be good. >> Yes, thank you for having us. >> No, I'm not the best guy, so, all right good. Hey, gentlemen, thank you for the time. >> Thank you >> Thank you. >> I appreciate it very much, great discussion. >> Thank you very much. >> Thanks for having us. >> Back with more from San Francisco right after this. (techno music)

>> live from Anaheim, California. It's the queue covering nutanix dot next twenty nineteen. Brought to you by Nutanix. >> Welcome back, everyone to the cubes. Live coverage of dot Next at NUTANIX. We're here in Anaheim, California. I'm your host, Rebecca Knight were joined by Wendy M. Pfeiffer. She is the chief information officer at Nutanix. Thank you so much for coming on the Cube. Wendy, thank you for having me. And this is not your first time you this year. A Cube alum. >> I am a Cube alum. It's so much fun. It's kind of weird, though. We're inside of this Cuban outside of us is all the action in the Exposition Hall is kind of crazy and cool. >> It is that there's a lot of energy here. I want to start our conversation by taking you back in time to nineteen eighties. You growing up in Silicon Valley, you notice an advertisement in the newspaper that dead tree medium NASA wants ideas on how to organize its dashboard. Better for astronauts. Yeah, >> So they had a program called CD T I cockpit displays of traffic information and they were looking for innovative ideas to make what was really a very small display provide information for the shuttle astronauts as they were re entering the atmosphere. And so, if you can imagine coming back into the atmosphere, it very high speed. And there was concern that there would be a traffic in the area. Regular airplanes flying, you know, relatively much slower. And so how could the same air traffic displays that were used for aviators be sort of modified to give real time information? Teo the astronauts, I will tell you that I never contributed much to that project, but I discovered large scale computer systems. And I just love the idea of these things large networks, large computers on just the through the vast interconnectedness of things. And so that got me interested in technology, whereas before I thought I was interested in science and math. And it turns out, of course, there's some great synergy among those topics. >> So So the internship at NASA is what propelled your interest and really, what launched your career in technology? Yes. Now you are the CEO of Nutanix. This this amazing company thiss startup That's now billion dollars with the market cap in multiple billions of dollars. Yes. So talk a little bit about your experience as CEO and what and what in what you're hearing, particularly at this dot next show. Yeah, I think >> one of the things that's happening is we're all in the midst of a huge transformation in terms of how digital technology affects business and empowers and enables business and as CEOs were right in the middle of that Wei have. Many of us have tons of legacy equipment and things from vendors, but we also have this desire for leading digital transformation in our companies. And so companies like Nutanix and there aren't many companies like Nutanix, but technologies like ours bridge that gap. We can run the legacy workloads in on premise data centers on pick a vendor's hardware. But we can also run the same work loads on our operating system in public clouds. And so it's kind of the best of both worlds, and it bridges thes two worlds that CEOs have been struggling to bridge, and it does so in a way that doesn't require us to re train our people or find, you know, a small team of rocket scientists who are, you know, worth more than the GDP of small countries. So we're able Teo, actually execute. Still keep the lights on. Still do the the old school things that we need to do but also operate with excellence at that more modern end of the technology spectrum. That's huge. And I'm hearing that from so many folks all around the show, whether it's, you know, people who are responsible for infrastructure or Dev Ops kind of crosses all of those bridges. And and as Nutanix, the CEO, I get to represent how any company like ours a billion and a half dollars publicly traded company, can use technology to enable itself, because I use our technology to do all the things we need to do as a company. >> But that's exactly just what you're talking about. That balance that these companies need to strike with thinking about the maintenance, thinking about the storage, thinking about the protection, but then also thinking in a much more visionary in strategic way about how we really transform our business and get our and get the work done that we need to get done. Can you talk a little bit about the fact that these consumer technologies have really leapfrog the thie enterprise vendors and sort of embarrassing it, frankly, should be for these big technology behemoth that they haven't done more to make cooler, sleeker technologies? >> Absolutely. Oh, my gosh, this is my favorite topic. And it's why I have my smart here. So on this smartphone, this is a is an apple phone on this smartphone. I have a ton of applications and a ton of functionality, and you know, so I have Facebook on my smartphone, right? And I love Facebook. >> But when I >> downloaded and I started using Facebook, I didn't say, you know Oh my gosh, fall. Now I have my social media application. So there's no way I could use Twitter or Instagram or anything else because my standard is Facebook. And that's the only thing I'm going to use. No, no, no. I have a multitude of APS and I used them as I choose when I want to, in the way that I want Teo, those abs inherit things from this platform. They have access to my contact data. They understand my location if I allow them tio etcetera. So all of those things are unconsciously in what is actually a phone. Now try to get your desk phone to do that right? It doesn't. And yet in the enterprise space, we have vendors who are selling us for millions of dollars, desk phones, and those were supposed to be as performance delightful, interesting as this device. And then we have laptop computers and we have desktop computers. None of those things is even a third as interesting, engaging, useful and easy to use as this consumer attack, which, by the way, is a lot less expensive. I spend millions of dollars on a V audio visual room systems of conferencing technology, whereas when I go home I can se teoh Amazon or Google. Hey, you know Amazon. Show me my my shows. You know I can I can I can ask for any show I want to watch on TV. When I downloaded Pokey Mongo, I love playing video games and games. When I downloaded Pokemon go on my phone. I >> didn't have to >> watch, you know, five five minute video snippets to teach me how to install the application. Within minutes, I was, you know, catching all the Pokemon I could what in what is really a very complex application that also includes augmented reality. And so I think it's time that first of all the vendors who sell to us, who are so used to that every three years, the enterprise license agreement is renewed. Or, you know, Hey, we're a pick something, you know, a one hardware vendors shop. So we that's what we standardize on that is doing two things. One, they're killing their own industry, and they're also killing. They're they're ruining. It is ability to deliver and to be useful and transformative. Two companies way and it way also have to demand better way. Have to stop buying that Dunc. And we have to start finding ways whether we have to build it ourselves or using machine learning tools to train the machine on how to do these things that that enterprise it cos don't deliver to us. And we also need to look for vendors like Nutanix that build that bridge that allow us to stop worrying about Oh my gosh, You know, we've got to make this legacy thing work with this new thing. We don't have to worry about that so much anymore. And now we can focus on this user experience The interaction design what we might do within an ecosystem That is our own unique companies and our own unique set of systems and also ultimately allowing our people, which is what companies are made up of allowing our people to to have the experience that they want tohave, just like we do with our own devices. I can choose how I want to interact with this thing, and I can turn it off if I don't want to use it. >> So so much of what you're talking about is really about getting companies and then the leaders of these companies to think differently. And that is the biggest managerial challenge. And it's a challenge when you're in sales. And so how do you How do you approach that problem? Because it because you've really laid it out so clearly we are used, Teo, so much intuitiveness and ease and beauty in the technology that we use in our personal lives. And then we come to work way put up with a lot of junk. >> We do, right? I mean, like, I know you're not saying anything out loud, but I know you. You're agree without you here with your laptop on the table there. You know, first of >> all, our work forces are changing. Generally, we keep talking, at least in circles that I sit in about, you know, the millennials are entering the work force. No. You know, the Millennials and Jen Zy are already make up almost half of our workforce today and will be at that somewhere around. I think it's seventy percent by twenty, twenty five of the workforce, so >> they're already here. Those >> folks already have a different relationship with technology than my generation did my generation. And I'm a Magen axe, I think. Yeah. Um so my my hub to Exactly So the big >> hair A my generation. >> I >> watched the birth of some of these consumer technologies, but this next couple of generations grew up with him already in place. And so they don't even think about the fact that this is technology. This is dependent, just is just part of them. And so I think we need Thio, Throw off the old filters and get out of the way. It's a lot more about choice and self service and freedom and flexibility and a mixed portfolio. And there are so many ways to educate ourselves about those things if if we don't naturally have that instinct. But it starts with diverse thinking, diverse tools. I believe that whatever you know, PC Mac laptop tablet mobile device that you're comfortable with your company should enable you to use. And you should use the applications that that makes the most sense to that make you the most productive. And then it's his job or it's leaderships job to create that that really rich ecosystem, where those applications and tools have the nutrients that they need and the capabilities that they need to work together well, understanding how to create and maintain that ecosystem mean what is an ecosystem? It's this sort of happy accident of all sorts of creatures at various levels in the in the pyramid coming together and figuring out a way to cohabit and to survive and then, hopefully to thrive. And so no one can get too important. No one voice no one species. No one layer can be outsized compared to the others because of So what do you have? Well, you have a species collapse. They run out of the fuel that helps them to thrive. And so I think, of course, our planet at a macro level is an example of that. But our company's our families, our neighborhoods. All of those things are micro examples that that matched the macro and are dependant on the same laws of physics and science and so on in order to thrive in to function. >> Well, you're talking you You just highlighted the importance of diversity. And and you made this comment about No one person can get two important or no one part of the species. In fact, if you look at the tech landscape Ueno, who's too important and it's the pros who are who are running the show in a lot of ways. Still, I want to hear from you as a senior leader, a female senior leader in technology you noticed, >> and Theo the manicure. Yeah, >> but how? What? What do you see? What? Tell us what it's like. I mean, is it as bad as we hear? And, um, and and And how have you in your career overcome a lot of these challenges? And then how What do you see as your responsibility to the next generation who's coming up? >> Absolutely. So it is as bad as we hear. It's sometimes worse than we here. And I think that especially there are certain sectors of society and tech society where the bro culture that we've heard about is fully in play. What mitigates that is the human beings who make up the bro culture so often. These guys don't understand the the effect of all of them and mass, and so often they're just being natural. Many, especially start ups. The start of fuel. Silicon Valley, You know, they started with some great ideas and with some dreamers and often those those people with the great ideas and dreamers you know they are males, and what do you do? You get your buddies together. You know, when you get a little extra money, you get the next round of bodies. You invite people, you know, so >> there's a little >> bit of that syndrome that's happening. There are also wonderful incubators and fields where women are also in that start up mode, and I'm a member of the Board of Girls and Tech. We have a number of things like Way have an amplified competition that supports women, tech the entrepreneurs, so there's certainly more than just men. But the history has been that however, a lot of people talk about that For me, that's not the emphasis for me. The emphasis is on how we change our jobs and our definition of work in general. And this is so fascinating to me. >> I think we've been working for years >> and years on, you know, how do we get more women and stem and encourage girls to go through this path in school? You know, it turns out women and men are both equally interested in science and math and all those things. But the starting jobs and tech are are horrendous when it comes to matching women's interests in skills and this isthe stereo, I'm going to start stereotype here. I hate doing this, but in general terms, men tend to be able to work on things serially. They tend to have a singular focus and to appreciate the singular focus and so you can lay out a path first, your socks and your shoes and the guy will follow that, and we'LL master each step along the way. And that's that's a way that you know, it's stereotypically a lot of male brain brains. Progress for women, for female brains were multifaceted way sort of have this ability. I don't know if it's evolutionary or environment or whatever. I'm not like an expert, thank God. >> But we have this >> ability to multi task all the time. I could be, you know, holding my kid and, um, talking on the phone and, you know, making sure dinners cooking, okay. And, you know, maybe it's a business call, and I might be hiring someone or firing someone, and I'm giving equal focused attention to each very important task. And so we sort of have that that ability because we have that ability. That's the kind of job that you know. Okay, you enter college and you're taking a software development computer science, of course. And you take all computer science courses until you get that degree. And now you get your first software developer job and you sit in this little cubicle and all day long you write code. Well, you know, fine. If I've sort of have that single threaded mentality, I'm ready. All right. I guess I'm going to do this. I'm gonna Masters are >> gonna get through the layers >> of writing code as fast as I can and someday I'll rule the world or start my own company over on the female side, we say this is going to kill me. I don't want to do that. What a boring jobs. Because Because also, I'm interested in I'm interested in the Japanese language and I'm interested in design. And, you know, I love to cook. And also, you know, I'm just been working through, you know, theories of space and time and in my physics study, and to just have to focus my mind all by myself all day long in this cubicle on writing, you know, some part of a bigger program. It's not attractive. And so what we find is that women are dropping out of thes focus degree programs and they're dropping out of the early stages of technology careers. Which means that by the time you get to my stage, there is not a very few of us right, >> So you said we needed we need to change the definition of work. Yes, What does that mean? >> Well, the Millennials and Gen Z and countries that are that are very young, like some of the Eastern European countries that air, that air, just reinventing themselves. They've already done that. It's the gig economy. It's the idea that as an individual, I can choose the things I want to work on. We've tried Teo, sort of emulate that in in the agile methodologies right? I get to choose my tasks, but it's this sort of. It was taken the soul out of it. But this is really that independent contractors might be doing. You know a few things that once I might be designing shoes like one of my friends is she's she's created her own shoe company, and at the same time I might be writing code Azaz a gig for some other company. And you know what? I might also be involved in, you know, a charitable work. Or I might be volunteering at my kid's school and doing all of those things together at the same time in parallel is interesting to us. It's engaging to us. We put more. >> So how'd you do that? At your team at NUTANIX? How do you help your employees, uh, do all the things that they want to do in addition to obviously getting their work done? Yeah, well, It's always a >> balance right. One of the really important things is to create an environment of tools and technologies and processes that allow people to choose the things they want to choose. It's not always well understood. Some people say thank you. I get to use the tools I like. Other people say there's too many tools what we d'Oh. And so we try to find something down the middle for those guys. Exactly. Secondly, I hire and mentor leaders who are very diverse and open, and they're thinking so that we can constantly kind of reinvent ourselves as an I T organization. But ultimately it gets down to enabling culturally people to think differently, to raise their hand and say, You know, I am a network engineer, but I would like Tio automate this thing over here or, you know, I Yes, I'm a systems engineer, but I'd like to deploy the network, just allowing them to get out of their comfort zone and to experiment. It's also really important to understand the balance of it. People who choose it love engineering and love technology, but we'LL also love process and interaction, and so we're already this mash up of personality types. And, you know, I would say more multifaceted you are, the more you're able to play multiple sports or or have multiple skills or play offense and defense, then the more able you are to thrive in the new World in the new economy. And sometimes it's just finding those mavericks Or, you know, I like to say I'm a little civil, like, you know, I've >> got a little personalities and you know it. Sometimes you got >> to bring one of those personalities to the table. Sometimes you have to bring many of those personalities to the table, and it's gonna be okay for folks to do that. >> I love it. I love it. Great. Well, Wendy, thank you so much for coming on the Cube. It's always fun talking to you. Thank you. Appreciate it. I'm Rebecca Knight. You are watching the Cube. They'LL be much more to come

(digital music) >> Welcome, everyone. Donald Klein here with CUBE Conversations, coming to you from our studios at theCUBE, here in Palo Alto, California. And today I'm fortunate enough to be joined by Paul Makowski, CTO of PolySwarm. PolySwarm is a fascinating company that plays in the security space, but is also part of this emerging block chain and token economy. Welcome, Paul. >> Thank you, thank you for having me. >> Great, so why don't we just start and give everybody an understanding of what PolySwarm does and how you guys do it? >> Sure, so PolySwarm is a new effort (audio fading in and out) to try to fix the economics around how threat (missing audio) >> Donald: Okay. >> So, we see a lot of shortcomings with (audio fading in and out) I think it's more of a economic concern rather than (missing audio) (laughs) Rather than a concern regarding (missing audio) >> Donald: Okay. >> So, what PolySwarm is (missing audio) and change how (missing audio) >> Okay. >> So, it is a blockchain project (missing audio) will govern tomorrow's threat-intelligence base and perhaps, ideally, generate better incentives (missing audio) >> Okay, so, generally if I'm understanding right, you're playing in this threat-intelligence area, which is commonly know as bug-bounties. Correct, yeah? But you guys have kind of taken this in a new direction. Why don't you just explain to me kind of where this threat-intelligence distributed economy has been and where where you see it going in the future. >> Sure, so bug bounties are, we had spoke earlier about HackerOne, for example. Bug bounties are an effort to identify vulnerabilities, and open vulnerability reports to arbitrary people across the internet. And incentivize people to secure products on behalf of the product owner. >> So, I can be an independent developer, and I find a vulnerability in something, and I submit it to one of these platforms, and then I get paid or rewarded for this. >> Yeah, and so the likes of HackerOne is a player in the space that conducts these bug bounties on behalf of other enterprises. >> Donald: Got it. >> Large enterprises such as Google and Microsoft and Apple, even, run their own bug bounties directly. >> Donald: Interesting. >> But, there's also these centralized middle men, the likes of HackerOne. Now, PolySwarm is a little bit different. We've discussed perhaps distributing the bug bounty space, but what we're focusing on right now at PolySwarm 1.0 is really just determining whether or not files, URLs, network graphics are either malicious or benign. >> Donald: Interesting. >> There's this boolean determination to start with, and then we're going to expand from there to metadata concerning, perhaps, the malware family of an identified malicious file. And then from there we'd also like to get into the bug bounty space. >> Okay. >> So, by PolySwarm being a fully decentralized market, us, as Swarm Technologies, will not be the middle man. We will not be in the middle of these transactions. We think that is going to make everything a bit more efficient for all the players on the market. And will best offer precision reward to be both accurate and timely in threat-intelligence. >> Interesting, okay, alright so I want to talk to you just a little bit more, because not everybody out there may be fully familiar with how a kind of decentralized app works. Talk to us a little bit about how blockchain fits in, how smart contracts fit in, and maybe just a little about, like, if I were to work on the PolySwarm platform, would I set up my own smart contract? Would somebody set it up for me? How would that work? >> Great question. So, in general, we see smart contracts as a new way to literally program a market. And I think this concept is applicable to a lot of different spaces. My background and the PolySwarm team background is in information (missing audio). >> Donald: Okay. >> So, we're applying smart contracts and market design specifically to a problem area that we are experts in. >> Okay, and what kind of smart contracts are these? What platform are you running on? >> We're running on Ethereum. We had previously discussed possibly expanding to Bezos, although there are perhaps some reasons not to do that anymore right now. But yeah, on Ethereum, we've been publishing our proof of concept code for our smart contracts right now which is available on github.com/polyswarm. More directly to your question concerning developing applications that plug into our platform or plug in to any platform, we've also released a opensource framework called Perigord. Which is a framework for developing Ethereum distributed applications using Go, which is a language developed by Google. So, I hope that answers a little bit, but >> So, you're really pioneering this whole world of moving to a decentralized, distributed app framework. >> Yeah, so, we're not the first people in this space, but we are expanding the ease of development to the Go language space, away from strictly programming in JavaScript. A lot distributed applications today are programmed in JavaScript. And there's pros and cons to each language, but we're hoping to get the Go language engaged a little more. >> So, let's go back now around to the people that are going to be participating in this marketplace, right. You were talking about unlocking the economic potential that's latent out there. Talk a little bit more about that. >> Exactly, so we had a spoken a little bit ago about HackerOne, and one of the things that I think is really cool about HackerOne is the fact that it's offered globally. What makes that really cool is that HackerOne gets a lot of great submissions from people in locales that may not indigenously offer sufficient jobs for the amount of talent that the local economies are producing. So, that's a sort of latent talent. HackerOne is particularly popular in India, China, Eastern European countries, we'd like to also direct that talent toward solving the threatened intelligence problem, namely accurately and timely identifying threats in files or graphic files. So, we'd like to-- We are operating in a eight and a half billion dollar per year space, the antivirus space, and we'd like to unlock this latent talent to broaden what threats are detected and how effectively enterprises defend themselves through a crowdsourced contributed manner that will cover more of the threats. >> Interesting, and so why don't you just talk a little about URLs and why those are important. We've seen a lot of hacks in the news recently, people going to sign up for a token sale and then being rerouted to the wrong place, et cetera. So, talk about malicious URLs. I think that might be an interest for people. >> Sure, everyone is trying to determine what URLs are malicious. Google has built into Chrome their safe browsing program that's also present in Firefox, Microsoft in some equivalent. Everyone's trying to determine and prevent people from being phished. You mentioned there were a few ICOs in this space that unfortunately had their websites hacked and their Ethereum contribution address changed, the hackers made off with some money. What PolySwarm does at a base level is it creates a market for security experts, again, around the world, to effectively put their money where their mouth is and say I think to the tune of 10 Nectar, for example, Nectar is the name of the PolySwarm note, that this URL or this file is malicious or benign. And those funds are escrowed directly into the smart contracts that constitute PolySwarm. And at a later time, the security experts who are right, receive the escrowed rewards from the security experts who were wrong. So, it's this feedback loop. >> It sounds like participants are kind of betting on both sides of whether something's malicious or not? >> Yeah, in effect. Legally, I definitely wouldn't say betting. (laughs) But it's >> Donald: Fair enough. >> The correct answer is there, right? The way that PolySwarm works is and enterprise has a suspect file or URL and decides to swarm it and what they do on the backend for that is they can either directly post this file or URL to the network, the network being the Ethereum blockchain. Everyone that's watching it and is cognizant of PolySwarm will be aware that there's a suspect file that perhaps I want to decide whether or not it's malicious as a security expert. Again, around the world, security experts will make that decision. If this is a particular file that I think I have insight into, as a security expert, then I might put up a certain amount of Nectar because I believe it is one way or the other. The reason why I say it's more of a-- The correct answer is in the file, right? It is in fact either malicious or benign. But what PolySwarm's economic reward is both timeliness and accuracy in determining that mal intent, whether or not that file is (missing audio). >> Interesting. And so the use of the smart contract is pretty novel here, right? Because the smart contracts then execute and distribute the bounties directly to the participants based on answer, is that right? >> That's correct. And that's the real key part. That eliminates the middle man in this space. A lot of the talk around blockchain in general is about restlessness, about not having middle men. In PolySwarm the core smart contract, again which are on github.com/polyswarm, they are able to actually hold escrowed upon. Though we're not in the middle and those escrowed funds are release to people who effectively get it right through the cost of people who got it wrong. So, we think >> And this is all automated through the system? >> This is all automated through the system. If I could take a step back real quick here, some of the shortcomings we're trying to address in today's market are if you imagine a Venn diagram, there's a rectangle that has all of the different threats in this space and you have large circles that cover portions of the Venn diagram and those large circles are today's large antivirus companies. Those circles overlap substantially. And the reason for that is pretty straight forward. Did you hear about perhaps WannaCry? It was a ransomware-- >> Absolutely, absolutely. >> If you're an antivirus company and you're not cognizant, you're not detecting WannaCry, then it's real easy to write you off. But the difficulty there is on the backend what that incentivizes is a lot of security companies doing duplicated work trying to detect the same threat. So there's a little bit of a clumpiness, there's a little bit of overlap, in what they detect and further it's very difficult although we've been speaking with people at those companies. They're always interested in the latest threat and uniquely detecting things, but it's sometimes very difficult to make Dell's argument that hey I detect this esoteric family of power >> Donald: Malicious URL, or et cetera. >> Exactly and by the way you're also going to get hit with it. That's a very difficult argument. >> So, you're sort of addressing the under served areas, then, within security. >> Precisely, so the way that PolySwarm will look in that Venn diagram, is instead of large, mostly overlapping ovals, we'll have thousands of micro-engines written by security experts that each find their specialty. And that together this crowdsourced intelligence will cover more. >> Interesting, very good, very good, okay. So, just last question here. Talk around a little bit of the background. How did PolySwarm come together? I know you talked about Narf Industries, et cetera. Why don't you just give us a little of the background here? 'Cause it's impressive. >> Sure, so again my background, and the entire PolySwarm technical team's background, is information security. We also run and work for a computer security consultancy called Narf Industries. Our more public work has been for DARPA, as of late. There was a large competition that DARPA ran called the "Cyber Grand Challenge" that was the-- they were trying to create the autonomous equivalent of a human capture the flag competition, which is a hacking competition. Anyway, we helped develop the challenges for that program and otherwise helped in that phase. So that's a public-facing project. >> And you won part of that competition, is that correct? >> Yeah, so we weren't competing in DARPA's Cyber Grand Challenge, but in the human capture the flags, we have won those. All the members of the core PolySwarm, and also Narf Industries, technical team have won DEF CON's capture the flag competition at least once. And some of us have helped run that competition. That's considered the world series of hacking (laughs). So, that's our background, and we're also all we've all previously worked directly for the U.S. government, so we're very much embedded in the cutting edge of cyber security. And, finally, the last thing I'll say, is Narf was recently awarded a contract with the Department of Homeland Security for investigating how to build confidentiality controls into a blockchain environment. The Department of Homeland Security was concerned about identity management. They wanted to apply a blockchain phase. But part of that, is obviously, you want to protect people's private information. So, how do you do that phase that, by default, is purely public. >> Got it, okay look we're going to have to end there, but let me just say, we would be remiss without mentioning the fact that your ICO's starting. When's that going to happen? >> So, we have an ICO that's going to go live February 6. Right now, we're just trying to generate buzz, talking to great people like yourself. After that lead up to the ICO, we'd like to encourage people to check out our website at polyswarm.io, we have a Telegram group that's growing everyday. And, again, a large part of what we would be funded by this ICO to accomplish is building the community around using PolySwarm. Fortunately, again, this is our space. So, we know a lot of people in this space, but we're always happy to be meeting people, so we'd love for all your viewers to join the conversation and engage with us. Our DMs on Twitter are open, et cetera. >> Okay, we hope they do. Probably just want to make one final point is that you guys are actually publishing all your code on GitHub ahead of the ICO, right? That kind of makes you unique in a very difficult space. >> It, unfortunately, does make us unique. I wish more projects did do that. But, yes, we are publishing our code in advance of the token sale. PolySwarm, if you're familiar with the conversation between securities and utility tokens, PolySwarm is very much a utility token. People will grade Nectar, which is the name of our Token, for threat intelligence. And part of that is we want to have a usable ecosystem on day one when people buy tokens. We want to make sure that you're not investing in some future thing. Obviously we're going to improve on it, but it will be usable from day one (missing audio). >> Alright, fantastic, so thank you, Paul. I appreciate you coming in. Alright, well thanks, everyone. Thank you for watching. This is Donald Klein with CUBE Conversations coming to you from Palo Alto, California. Thank you for watching. (digital music)

>> Announcer: Live from Madrid, Spain. It's theCube covering HPE Discover Madrid 2017. Brought to you by Hewlett-Packard Enterprise. >> And we're back at HPE Discover Madrid 2018. This is theCube, the leader in live tech coverage. I'm Dave Vellante, with my co-host Peter Burris. This is day two of the event. Johannes Koch is here, he's the Vice President and Managing Director of Central Eastern Europe, Middle East and Africa for Hewlett-Packard Enterprise, and he's joined by Ali Saleh, he's the Senior Vice President and Chief Commercial Officer at GE Digital for Middle East and Africa. Gentlemen, thanks so much for coming to theCube. >> Appreciate it. Thank you. >> Thank you for having us. >> Johannes, let's start off with you. GE, HPE, what are you guys all about, what are you doing together? Talk about the partnership and the alliance. >> So, you know, it started actually one month ago, I suppose and it was meetings that we had with General Electric to understand the customer requirements in cybersecurity, and what we figured is in this world of IoT, Internet of Things there is an increased requirement for security. And there was, from our perspective, lots of solutions out there but it's quite difficult for customers to understand the landscape and who to turn to. And we also figured that in this world, nobody can serve every requirement of a customer, so this is how we figured out with GED that we have a joint interest here, to serve in the Central/Eastern European and then mainly in the Middle East and Africa part our customer base. And this is how it started and I think what I can say is it has accelerated incredibly during the last two months since we signed the joint agreement. We've been building a channel, we've been having lots of meetings with customers and built a really nice pipeline in the meantime, also I think here the show reflects an incredible interest by our customers. So I think we are in a very good state at the moment having a lot of interest, probably all the key customers in our region having this on their agenda. >> Ali, maybe you could just describe the situation, the industrial expansion if you will in Middle East and Africa, what you guys are seeing in terms of the big trends, and what the opportunity looks like. >> Well thank you. You know, GE has been in the Middle East, Africa, for over 80 years in some countries, and we have deep relationships on industrial side, whether it's power, oil and gas, aviation, healthcare and others. And our customers are thinking a lot about cost, quality, and access, and productivity is top of mind, and they've discovered that their industrial assets are smart and capable but the data are not being collected. So when we collaborate with ecosystem of partners, and we fetch the data and get connected, and get insights from the machine to make them able to make the right decision at the right time and then it drives optimization. This is top of mind. They want to see how they can do better for less. >> Okay, so the customers at GE Digital, the customers are going digital, they have all these devices, instruments, machines, and they're moving in a new direction you guys are trying to lead in. What are the challenges that they're facing, what are they asking your help on, what are the big problems that they're trying to solve? >> So, everyone wants to talk about productivity and calls out. The challenge is that not everyone is ready for digital transformation. Some do not feel there is a burning platform, and those that are ready when they feel there is a burning platform, they don't have a plan, they don't have a playbook. So it's important that we collaborate and help our partners and customers understand their current state and heat map and desired state and pinpoint to quick wins so that they get it and they see incremental improvement. And asset performance management has been an easy way for us to say, "Your asset is underutilized "compared to your industrial entitlement "you can do 10x better," and this gets their attention, and this is where we see the power of one in the industrial age is relevant, one percent. In our market, in the world free market, when we talk to them about one or two percent productivity they laugh at us. They say, "Talk to us about ten or twenty." Because there has been a lot of gap in productivity and efficiency. >> Are you able to, I mean, it's only been nine months, but are you able to start to see any kind of customer results at this point? Do you have some examples even early wins with customers? >> So to be exact, the start of the relationship in a formal way-- >> Was it, what'd you say? >> --is two months. >> I thought I heard nine months. >> No, no, we started our first conversations and until it was over, it came to the agreement-- >> So it was brand new, in terms of... >> It is really brand new and I think what we can say is, I think we have 180 partners already engaged. We have probably more than 500 customer contacts in the region already so with large accounts. And we have a pipeline that is multi-million dollar in size. So we're expecting the first close within our first quarter, which ends at January 2018. I think there's no question that there is a big market opportunity out there, right? And I think the show here, I think for me, even accelerated things, because I think in the past, digital transformation was sort of limited to a few industries, we always give travel industry, we take banking sometimes but here, I think what became transparent to many of the customers that we had here, that there is no industry that is sort of immune against what is happening out there and specifically also that the sensors and the devices out there require special attention. And I think with the, specifically on the OT side, we have a solution now with GED that we can basically roll out across our territory. >> So I wanna talk about three things very quickly, I'm gonna lay this out and ask you if in fact this is going to catalyze that much more attention. Number one is a lot of the industry in the Middle East and Africa are natural resource industries, where the historical ways of doing things have been relatively inefficient. So there's a lot of opportunity to use IoT and related things to bring more efficiency, better practices, overall resource management. Number two is, that the technology's now capable of doing that in places where you don't necessarily have the best infrastructure. Aruba technology, for wireless, some of the other things are now possible, that adds to it. And number three, we've seen some recent steps in liberalizing some of the countries that have the most opportunity to do some things differently. You know, Robert Mugabe, no longer in Zimbabwe, the new prince in Saudi Arabia talking about liberalizing things. Are you seeing these come together in a way that would encourage people to think new ways, do new things, use information perhaps differently than it did before? What do you think, is this a confluence, is this a moment? >> Well I agree with you, and absolutely. Today, our customers and partners in region are more ready than before, and they're pulling hard. And when we put our act together as an ecosystem of partners we make it easier on them to make the right decision. When we talk productivity, productivity comes from people, from process operation, from industrial entitlement. And when we talk about the digital thread that brings it all together whether we look at the culture and vision and mission and people utilization, look at the process defined or not, and how we can optimize it, look at the industrial entitlement, and tell them, "Compared to your peers, "this is where you can be." We have their attention. And with the push from the government for productivity and utilization and do more for less, this is becoming top of mind, everyone is talking about it. So, when we partner together and we say, "This is the playbook, this is how you can start, "and this is the edge to cloud solution in a secure way." And we link it to the industrial entitlement, and let's underline industrial, because when we speak the healthcare language and the power language and the oil and gas language we get their attention. >> Excellent, so there's an increasing interest, and you anticipate that there's going to be new action with their pocketbooks. >> Johannes: Yes. And I would add, I think we, this is not an easy marketplace but you can have some outstanding projects. And we have, in the region, you may have heard about, there was in the private investment fund, when the crown prince did announce the NEOM project. Or, we have in Dubai Smart City as a project, with the city of Dubai which are all projects that probably would not happen in Western Europe. So there is potential, there are bigger things happening, and I think there is also an understanding that this is a way how to leapfrog, to your point, to leapfrog technology. And I think that is what can happen. What we need to be careful of is where to invest, because there are lots of ideas out there, and to understand what are the real things, and what are the things that we need to make happen. This is, I think, the challenge. >> And they wouldn't happen in Western Europe because, what? The maturity of the infrastructure, the space limitations, the appetite? >> Johannes: I think, to give the example of Smart City. >> Dave: Yeah. >> So I think we have a lot of, in my remit we have lots of discussion on Smart City. But it's usually you have to find the city that is willing to pay a POC. >> Pete: 12 layers of bureaucracy. >> And exactly. And you need to talk to each and every city individually, whereas here, if you have a decision maker to say, "Yes, we do this." >> Pete: Yep. >> Dave: Right. >> And then we do it. >> Dave: You cut the line. >> And the answer is about readiness. When you go to a large enterprise that's very successful, you meet the CEO and you quickly conclude whether they're ready for digital transformation or not, are they gonna make this top of mind for them? Are they gonna give you time? Are they gonna talk about productivity? Or is this going to be an IT discussion, and they're gonna treat you as a supplier? Those that are ready, we roll up our sleeves, and we put in our dedicated resources to help them look at the transformation. When the government official is pushing and mandating for calls out, then obviously everyone wants to copy and talk about it. And this makes it easier for us to execute. >> You're talking, again, big numbers. Not one percent, ten percent, so that's the nirvana. How confident are you that you can actually have that type of impact? >> So we've got data points, right? If you look at healthcare in the Saudi Ministry of Health, we've been collaborating on looking at operating room optimization or emergency room optimization, without touching digitization. Looking at the process and utilization of appointments, no-show, and the way the clinical governance is taking place, we're showing 40 percent improvement. If you look at, the factory of the future with Obeikan in Saudi Arabia, we've got asset performance improvement project, and they already yielded a 12 percent improvement, and the entitlement is up to 20, that we're working on. When you transform something, it's iterative, right? When you transform something that you have not pushed for efficiency before it's easy for the first iteration to show an incremental change. >> Pete: Yup. >> That challenge will be for the change to last. And this is where digitization makes it last and makes it impactful. And when we look at the HPE relationship with the MOH on the electronic medical record, we've got right now two active projects with two hospitals, and it's all powered by Predix, and HP peripherals are being deployed to the site. And if we go to the Saudi Electricity Company, we've got a project now on asset performance management across all their assets and again HPE peripherals are also deployed and it's all about GE ecosystem of Predix-enabled solutions. >> So I've had the pleasure and honor of speaking in front of a relatively large group of CIOs a couple times in Africa in the past few years. And I always was surprised by the degree to which they suggested that the necessity of change in this region, and the fact that a little bit of technology can have an enormous impact, the degree to which we might actually see some leadership technology come out of this region. What do you think, are the types of issues, the types of problems that could be solved with this technology in Africa, the types of problems that solving them there could actually start driving the industry in different directions? Solving new classes, whole new classes of problems. Do you think that this type of technology can have a transformative effect, not only in Africa but more broadly? >> Absolutely, this is a way for systems to leapfrog. If you look at Kenya right now, they've got a transformation project for 98 hospitals. And they've got massive shortage of radiologists. So right now, we're replacing equipment in 98 hospitals but tele-radiology is the answer for the shortage of radiologists. If you look to South African Discovery, what Discovery is doing is best in class, and I haven't seen any other insurance company looking at the ecosystem the way they do it. So, absolutely, we're seeing pockets of excellence in Africa, and this can be a way to leapfrog. >> You said you started the conversations around security. >> Johannes: Cybersecurity. >> What was that conversation like? Why was that the starting point? I mean, obviously it's important, but why? >> To be honest, I would have to leave this to you, but I think it was because mainly there was we saw the customer interest. >> Yeah. >> And I would say, probably a year or two years ago, you would have not seen this as a very typical HPE alliance. We were technology people. We were software or hardware people. What you see in, and I mentioned in the beginning, in the world of IoT, things are blurring a bit. What is happening on the edge is very much in the business of General Electric. So I think this builds automatically the new ecosystem. When you look here at Discovery, the alliance has become more and more industrial companies. It's linked to industrial 4.0, car industries and all that. Everywhere where data is being created, we need to have the partnership because and that is because the data that is being created at the edge also needs to be computed at the edge. If we want to be successful, we gotta say, "We cannot limit ourselves to the "data centers the rest is the others." And this is where I think we find the very good connection point because now we have software that actually can operate at the edge. I think you have good examples on that. >> Yeah absolutely, if you look at the pain point in Middle East, Africa, majority of our partners and customers are government entities and for them top of mind securing their large industrial assets is important. And in the operations space there hasn't been much done on security, where you can go into a hospital and simulate light flickering with a voltmeter. And you can take over the temperature and play with it. Today there's a lot of smart sensors out there, but we're securing the IT firewall, but within the hospital, or within the plant, we can do a lot of crazy stuff. And we owe it to our partners to show our capability. That's what we do within our factories, and our platform is designed around security for operations. So the easier interlock with HPE is our ability to get closer to the edge and peripherals, and ensure the operation is secure and that's the first experiment but then, obviously, we're expanding beyond that to other opportunities. >> Dave: Excellent. Alright, gentlemen, we have to leave it there. Thanks so much for coming to theCube. >> Johannes: Thank you very much. >> Sharing your story, good luck with the partnership. >> Thank you. >> Dave: Hope you can come back, maybe in Las Vegas or maybe next year at this event, give us the update. >> For sure. Thank you very much. >> Thank you. Appreciate it. >> Dave: Okay. Keep it right there, everybody. We'll be back with our next guest. Dave Vellante, Peter Burris, this is theCube live from Madrid HPE Discover 2017. (upbeat music)

>> Narrator: New York City, it's the Cube covering CyberConnect 2017 brought to you by Centrify and the Institute for Critical Infrastructure Technology. >> Welcome back, everyone. This is the Cube's live coverage in New York City's Grand Hyatt Ballroom for CyberConnect 2017 presented by Centrify. I'm John Furrier, the co-host of the Cube with my co-host this week is Dave Vellante, my partner and co-founder and co-CEO with me in SiliconAngle Media in the Cube. Our next guest is James Scott who is the co-founder and senior fellow at ICIT. Welcome to the Cube. >> Thanks for having me. >> You guys are putting on this event, really putting the content together. Centrify, just so everyone knows, is underwriting the event but this is not a Centrify event. You guys are the key content partner, developing the content agenda. It's been phenomenal. It's an inaugural event so it's the first of its kind bringing in industry, government, and practitioners all together, kind of up leveling from the normal and good events like Black Hat and other events like RSA which go into deep dives. Here it's a little bit different. Explain. >> Yeah, it is. We're growing. We're a newer think tank. We're less than five years old. The objective is to stay smaller. We have organizations, like Centrify, that came out of nowhere in D.C. so we deal, most of what we've done up until now has been purely federal and on the Hill so what I do, I work in the intelligence community. I specialize in social engineering and then I advise in the Senate for the most part, some in the House. We're able to take these organizations into the Pentagon or wherever and when we get a good read on them and when senators are like, "hey, can you bring them back in to brief us?" That's when we know we have a winner so we started really creating a relationship with Tom Kemp, who's the CEO and founder over there, and Greg Cranley, who heads the federal division. They're aggressively trying to be different as opposed to trying to be like everyone else, which makes it easy. If someone wants to do something, they have to be a fellow for us to do it, but if they want to do it, just like if they want to commission a paper, we just basically say, "okay, you can pay for it but we run it." Centrify has just been excellent. >> They get the community model. They get the relationship that you have with your constituents in the community. Trust matters, so you guys are happy to do this but more importantly, the content. You're held to a standard in your community. This is new, not to go in a different direction for a second but this is what the community marketing model is. Stay true to your audience and trust. You're relied upon so that's some balance that you guys have to do. >> The thing is we deal with cylance and others. Cylance, for example, was the first to introduce machine learning artificial intelligence to get passed that mutating hash for endpoint security. They fit in really well in the intelligence community. The great thing about working with Centrify is they let us take the lead and they're very flexible and we just make sure they come out on top each time. The content, it's very content driven. In D.C., we have at our cocktail receptions, they're CIA, NSA, DARPA, NASA. >> You guys are the poster child of be big, think small. >> Exactly. Intimate. >> You say Centrify is doing things differently. They're not falling in line like a lemming. What do you mean by that? What is everybody doing that these guys are doing differently? >> I think in the federal space, I think commercial too, but you have to be willing to take a big risk to be different so you have to be willing to pay a premium. If people work with us, they know they're going to pay a premium but we make sure they come out on top. What they do is, they'll tell us, Centrify will be like, "look, we're going to put x amount of dollars into a lunch. "Here are the types of pedigree individuals "that we need there." Maybe they're not executives. Maybe they're the actual practitioners at DHS or whatever. The one thing that they do different is they're aggressively trying to deviate from the prototype. That's what I mean. >> Like a vendor trying to sell stuff. >> Yeah and the thing is, that's why when someone goes to a Centrify event, I don't work for Centrify (mumbles). That's how they're able to attract. If you see, we have General Alexander. We've got major players here because of the content, because it's been different and then the other players want to be on the stage with other players, you know what I mean. It almost becomes a competition for "hey, I was asked to come to an ICIT thing" you know, that sort of thing. That's what I mean. >> It's reputation. You guys have a reputation and you stay true to that. That's what I was saying. To me, I think this is the future of how things get done. When you have a community model, you're held to a standard with your community. If you cross the line on that standard, you head fake your community, that's the algorithm that brings you a balance so you bring good stuff to the table and you vet everyone else on the other side so it's just more of a collaboration, if you will. >> The themes here, what you'll see is within critical infrastructure, we try to gear this a little more towards the financial sector. We brought, from Aetna, he set up the FS ISAC. Now he's with the health sector ISAC. For this particular geography in New York, we're trying to have it focus more around health sector and financial critical infrastructure. You'll see that. >> Alright, James, I've got to ask you. You're a senior fellow. You're on the front lines with a great Rolodex, great relationships in D.C., and you're adivising and leaned upon by people making policy, looking at the world and the general layout in which, the reality is shit's happening differently now so the world's got to change. Take us through a day in the life of some of the things you guys are seeing and what's the outlook? I mean, it's like a perfect storm of chaos, yet opportunity. >> It really depends. Each federal agency, we look at it from a Hill perspective, it comes down to really educating them. When I'm in advising in the House, I know I'm going to be working with a different policy pedigree than a Senate committee policy expert, you know what I mean. You have to gauge the conversation depending on how new the office is, House, Senate, are they minority side, and then what we try to do is bring the issues that the private sector is having while simultaneously hitting the issues that the federal agency space is. Usually, we'll have a needs list from the CSWEP at the different federal agencies for a particular topic like the Chinese APTs or the Russian APT. What we'll do is, we'll break down what the issue is. With Russia, for example, it's a combination of two types of exploits that are happening. You have the technical exploit, the malicious payload and vulnerability in a critical infrastructure network and then profiling those actors. We also have another problem, the influence operations, which is why we started the Center for Cyber Influence Operations Studies. We've been asked repeatedly since the elections last year by the intelligence community to tell us, explain this new propaganda. The interesting thing is the synergies between the two sides are exploiting and weaponizing the same vectors. While on the technical side, you're exploiting a vulnerability in a network with a technical exploit, with a payload, a compiled payload with a bunch of tools. On the influence operations side, they're weaponizing the same social media platforms that you would use to distribute a payload here but only the... >> Contest payload. Either way you have critical infrastructure. The payload being content, fake content or whatever content, has an underpinning that gamification call it virality, network effect and user psychology around they don't really open up the Facebook post, they just read the headline and picture. There's a dissonance campaign, or whatever they're running, that might not be critical to national security at that time but it's also a post. >> It shifts the conversation in a way where they can use, for example, right now all the rage with nation states is to use metadata, put it into big data analytics, come up with a psychographic algorithm, and go after critical infrastructure executives with elevated privileges. You can do anything with those guys. You can spearfish them. The Russian modus operandi is to call and act like a recruiter, have that first touch of contact be the phone call, which they're not expecting. "Hey, I got this job. "Keep it on the down low. Don't tell anybody. "I'm going to send you the job description. "Here's the PDF." Take it from there. >> How should we think about the different nation state actors? You mentioned Russia, China, there's Iran, North Korea. Lay it out for us. >> Each geography has a different vibe to their hacking. With Russia you have this stealth and sophistication and their hacking is just like their espionage. It's like playing chess. They're really good at making pawns feel like they're kings on the chessboard so they're really good at recruiting insider threats. Bill Evanina is the head of counterintel. He's a bulldog. I know him personally. He's exactly what we need in that position. The Chinese hacking style is more smash and grab, very unsophisticated. They'll use a payload over and over again so forensically, it's easy to... >> Dave: Signatures. >> Yeah, it is. >> More shearing on the tooling or whatever. >> They'll use code to the point of redundancy so it's like alright, the only reason they got in... Chinese get into a network, not because of sophistication, but because the network is not protected. Then you have the mercenary element which is where China really thrives. Chinese PLA will hack for the nation state during the day, but they'll moonlight at night to North Korea so North Korea, they have people who may consider themselves hackers but they're not code writers. They outsource. >> They're brokers, like general contractors. >> They're not sophisticated enough to carry out a real nation state attack. What they'll do is outsource to Chinese PLA members. Chinese PLA members will be like, "okay well, here's what I need for this job." Typically, what the Chinese will do, their loyalties are different than in the west, during the day they'll discover a vulnerability or an O day. They won't tell their boss right away. They'll capitalize off of it for a week. You do that, you go to jail over here. Russia, they'll kill you. China, somehow this is an accepted thing. They don't like it but it just happens. Then you have the eastern European nations and Russia still uses mercenary elements out of Moscow and St. Petersburg so what they'll do is they will freelance, as well. That's when you get the sophisticated, carbonic style hack where they'll go into the financial sector. They'll monitor the situation. Learn the ins and outs of everything having to do with that particular swift or bank or whatever. They go in and those are the guys that are making millions of dollars on a breach. Hacking in general is a grind. It's a lot of vulnerabilities work, but few work for long. Everybody is always thinking there's this omega code that they have. >> It's just brute force. You just pound it all day long. >> That's it and it's a grind. You might have something that you worked on for six months. You're ready to monetize. >> What about South America? What's the vibe down there? Anything happening in there? >> Not really. There is nothing of substance that really affects us here. Again, if an organization is completely unprotected. >> John: Russia? China? >> Russia and China. >> What about our allies? >> GCHQ. >> Israel? What's the collaboration, coordination, snooping? What's the dynamic like there? >> We deal, mostly, with NATO and Five Eyes. I actually had dinner with NATO last night. Five Eyes is important because we share signals intelligence and most of the communications will go through Five Eyes which is California, United States, Australia, New Zealand, and the UK. Those are our five most important allies and then NATO after that, as far as I'm concerned, for cyber. You have the whole weaponization of space going on with SATCOM interception. We're dealing with that with NASA, DARPA. Not a lot is happening down in South America. The next big thing that we have to look at is the cyber caliphate. You have the Muslim brotherhood that funds it. Their influence operations domestically are extremely strong. They have a lot of contacts on the Hill which is a problem. You have ANTIFA. So there's two sides to this. You have the technical exploit but then the information warfare exploit. >> What about the bitcoin underbelly that started with the silk roads and you've seen a lot of bitcoin. Money laundering is a big deal, know your customer. Now regulation is part of big ICOs going on. Are you seeing any activity from those? Are they pulling from previous mercenary groups or are they arbitraging just more free? >> For updating bitcoin? >> The whole bitcoin networks. There's been an effort to commercialize (mumbles) so there's been a legitimate track to bring that on but yet there's still a lot of actors. >> I think bitcoin is important to keep and if you look at the more black ops type hacking or payment stuff, bitcoin is an important element just as tor is an important element, just as encryption is an important element. >> John: It's fundamental, actually. >> It's a necessity so when I hear people on the Hill, I have my researcher, I'm like, "any time you hear somebody trying to have "weakened encryption, back door encryption" the first thing, we add them to the briefing schedule and I'm like, "look, here's what you're proposing. "You're proposing that you outlaw math. "So what? Two plus two doesn't equal four. "What is it? Three and a half? "Where's the logic?" When you break it down for them like that, on the Hill in particular, they begin to get it. They're like, "well how do we get the intelligence community "or the FBI, for example, to get into this iphone?" Civil liberties, you've got to take that into consideration. >> I got to ask you a question. I interviewed a guy, I won't say his name. He actually commented off the record, but he said to me, "you won't believe how dumb some of these state actors are "when it comes to cyber. "There's some super smart ones. "Specifically Iran and the Middle East, "they're really not that bright." He used an example, I don't know if it's true or not, that stuxnet, I forget which one it was, there was a test and it got out of control and they couldn't pull it back and it revealed their hand but it could've been something worse. His point was they actually screwed up their entire operation because they're doing some QA on their thing. >> I can't talk about stuxnet but it's easy to get... >> In terms of how you test them, how do you QA your work? >> James: How do you review malware? (mumbles) >> You can't comment on the accuracy of Zero Days, the documentary? >> Next question. Here's what you find. Some of these nation state actors, they saw what happened with our elections so they're like, "we have a really crappy offensive cyber program "but maybe we can thrive in influence operations "in propaganda and whatever." We're getting hit by everybody and 2020 is going to be, I don't even want to imagine. >> John: You think it's going to be out of control? >> It's going to be. >> I've got to ask this question, this came up. You're bringing up a really good point I think a lot of people aren't talking about but we've brought up a few times. I want to keep on getting it out there. In the old days, state on state actors used to do things, espionage, and everyone knew who they were and it was very important not to bring their queen out, if you will, too early, or reveal their moves. Now with Wikileaks and public domain, a lot of these tools are being democratized so that they can covertly put stuff out in the open for enemies of our country to just attack us at will. Is that happening? I hear about it, meaning that I might be Russia or I might be someone else. I don't want to reveal my hand but hey, you ISIS guys out there, all you guys in the Middle East might want to use this great hack and put it out in the open. >> I think yeah. The new world order, I guess. The order of things, the power positions are completely flipped, B side, counter, whatever. It's completely not what the establishment was thinking it would be. What's happening is Facebook is no more relevant, I mean Facebook is more relevant than the UN. Wikileaks has more information pulsating out of it than a CIA analyst, whatever. >> John: There's a democratization of the information? >> The thing is we're no longer a world that's divided by geographic lines in the sand that were drawn by these two guys that fought and lost a war 50 years ago. We're now in a tribal chieftain digital society and we're separated by ideological variation and so you have tribe members here in the US who have fellow tribe members in Israel, Russia, whatever. Look at Anonymous. Anonymous, I think everyone understands that's the biggest law enforcement honeypot there is, but you look at the ideological variation and it's hashtags and it's keywords and it's forums. That's the Senate. That's congress. >> John: This is a new reality. >> This is reality. >> How do you explain that to senators? I was watching that on TV where they're trying to grasp what Facebook is and Twitter. (mumbles) Certainly Facebook knew what was going on. They're trying to play policy and they're new. They're newbies when it comes to policy. They don't have any experience on the Hill, now it's ramping up and they've had some help but tech has never been an actor on the stage of policy formulation. >> We have a real problem. We're looking at outside threats as our national security threats, which is incorrect. You have dragnet surveillance capitalists. Here's the biggest threats we have. The weaponization of Facebook, twitter, youtube, google, and search engines like comcast. They all have a censorship algorithm, which is how they monetize your traffic. It's censorship. You're signing your rights away and your free will when you use google. You're not getting the right answer, you're getting the answer that coincides with an algorithm that they're meant to monetize and capitalize on. It's complete censorship. What's happening is, we had something that just passed SJ res 34 which no resistance whatsoever, blew my mind. What that allows is for a new actor, the ISPs to curate metadata on their users and charge them their monthly fee as well. It's completely corrupt. These dragnet surveillance capitalists have become dragnet surveillance censorists. Is that a word? Censorists? I'll make it one. Now they've become dragnet surveillance propagandists. That's why 2020 is up for grabs. >> (mumbles) We come from the same school here on this one, but here's the question. The younger generation, I asked a gentleman in the hallway on his way out, I said, "where's the cyber west point? "We're the Navy SEALS in this new digital culture." He said, "oh yeah, some things." We're talking about the younger generation, the kids playing Call of Duty Destiny. These are the guys out there, young kids coming up that will probably end up having multiple disciplinary skills. Where are they going to come from? So the question is, are we going to have a counterculture? We're almost feeling like what the 60s were to the 50s. Vietnam. I kind of feel like maybe the security stuff doesn't get taken care of, a revolt is coming. You talk about dragnet censorship. You're talking about the lack of control and privacy. I don't mind giving Facebook my data to connect with my friends and see my thanksgiving photos or whatever but now I don't want fake news jammed down my throat. Anti-Trump and Anti-Hillary spew. I didn't buy into that. I don't want that anymore. >> I think millennials, I have a 19 year old son, my researchers, they're right out of grad school. >> John: What's the profile like? >> They have no trust whatsoever in the government and they laugh at legislation. They don't care any more about having their face on their Facebook page and all their most intimate details of last night's date and tomorrow's date with two different, whatever. They just don't... They loathe the traditional way of things. You got to talk to General Alexander today. We have a really good relationship with him, Hayden, Mike Rogers. There is a counterculture in the works but it's not going to happen overnight because we have a tech deficit here where we need foreign tech people just to make up for the deficit. >> Bill Mann and I were talking, I heard the general basically, this is my interpretation, "if we don't get our shit together, "this is going to be an f'd up situation." That's what I heard him basically say. You guys don't come together so what Bill talked about was two scenarios. If industry and government don't share and come together, they're going to have stuff mandated on them by the government. Do you agree? >> I do. >> What's going to happen? >> The argument for regulation on the Hill is they don't want to stifle innovation, which makes sense but then ISPs don't innovate at all. They're using 1980s technology, so why did you pass SJ res 34? >> John: For access? >> I don't know because nation states just look at that as, "oh wow another treasure trove of metadata "that we can weaponize. "Let's start psychographically charging alt-left "and alt-right, you know what I mean?" >> Hacks are inevitable. That seems to be the trend. >> You talked before, James, about threats. You mentioned weaponization of social. >> James: Social media. >> You mentioned another in terms of ISPs I think. >> James: Dragnet. >> What are the big threats? Weaponization of social. ISP metadata, obviously. >> Metadata, it really depends and that's the thing. That's what makes the advisory so difficult because you have to go between influence operations and the exploit because the vectors are used for different things in different variations. >> John: Integrated model. >> It really is and so with a question like that I'm like okay so my biggest concern is the propaganda, political warfare, the information warfare. >> People are underestimating the value of how big that is, aren't they? They're oversimplifying the impact of info campaigns. >> Yeah because your reality is based off of... It's like this, influence operations. Traditional media, everybody is all about the narrative and controlling the narrative. What Russia understands is to control the narrative, the most embryo state of the narrative is the meme. Control the meme, control the idea. If you control the idea, you control the belief system. Control the belief system, you control the narrative. Control the narrative, you control the population. No guns were fired, see what I'm saying? >> I was explaining to a friend on Facebook, I was getting into a rant on this. I used a very simple example. In the advertising world, they run millions of dollars of ad campaigns on car companies for post car purchase cognitive dissonance campaigns. Just to make you feel good about your purchase. In a way, that's what's going on and explains what's going on on Facebook. This constant reinforcement of these beliefs whether its for Trump or Hillary, all this stuff was happening. I saw it firsthand. That's just one small nuance but it's across a spectrum of memes. >> You have all these people, you have nation states, you have mercenaries, but the most potent force in this space, the most hyperevolving in influence operations, is the special interest group. The well-funded special interests. That's going to be a problem. 2020, I keep hitting that because I was doing an interview earlier. 2020 is going to be a tug of war for the psychological core of the population and it's free game. Dragnet surveillance capitalists will absolutely be dragnet surveillance propagandists. They will have the candidates that they're going to push. Now that can also work against them because mainstream media, twitter, Facebook were completely against trump, for example, and that worked in his advantage. >> We've seen this before. I'm a little bit older, but we are the same generation. Remember when they were going to open up sealex? Remember the last mile for connectivity? That battle was won before it was even fought. What you're saying, if I get this right, the war and tug of war going on now is a big game. If it's not played in one now, this jerry rigging, gerrymandering of stuff could happen so when people wake up and realize what's happened the game has already been won. >> Yeah, your universe as you know it, your belief systems, what you hold to be true and self evident. Again, the embryo. If you look back to the embryo introduction of that concept, whatever concept it is, to your mind it came from somewhere else. There are very few things that you believe that you came up with yourself. The digital space expedites that process and that's dangerous because now it's being weaponized. >> Back to the, who fixes this. Who's the watchdog on this? These ideas you're talking about, some of them, you're like, "man that guy has lost it, he's crazy." Actually, I don't think you're crazy at all. I think it's right on. Is there a media outlet watching it? Who's reporting on it? What even can grasp what you're saying? What's going on in D.C.? Can you share that perspective? >> Yeah, the people that get this are the intelligence community, okay? The problem is the way we advise is I will go in with one of the silos in the NSA and explain what's happening and how to do it. They'll turn around their computer and say, "show me how to do it. "How do you do a multi vector campaign "with this meme and make it viral in 30 minutes." You have to be able to show them how to do it. >> John: We can do that. Actually we can't. >> That sort of thing, you have to be able to show them because there's not enough practitioners, we call them operators. When you're going in here, you're teaching them. >> The thing is if they have the metadata to your treasure trove, this is how they do it. I'll explain here. If they have the metadata, they know where the touch points are. It's a network effect mole, just distributive mole. They can put content in certain subnetworks that they know have a reaction to the metadata so they have the knowledge going in. It's not like they're scanning the whole world. They're monitoring pockets like a drone, right? Once they get over the territory, then they do the acquired deeper targets and then go viral. That's basically how fake news works. >> See the problem is, you look at something like alt-right and ANTIFA. ANTIFA, just like Black Lives Matter, the initiatives may have started out with righteous intentions just like take a knee. These initiatives, first stage is if it causes chaos, chaos is the op for a nation state in the US. That's the op. Chaos. That's the beginning and the end of an op. What happens is they will say, "oh okay look, this is ticking off all these other people "so let's fan the flame of this take a knee thing "hurt the NFL." Who cares? I don't watch football anyway but you know, take a knee. It's causing all this chaos. >> John: It's called trolling. >> What will happen is Russia and China, China has got their 13 five year plan, Russia has their foreign influence operations. They will fan that flame to exhaustion. Now what happens to the ANTIFA guy when he's a self-radicalized wound collector with a mental disorder? Maybe he's bipolar. Now with ANTIFA, he's experienced a heightened more extreme variation of that particular ideology so who steps in next? Cyber caliphate and Muslim brotherhood. That's why we're going to have an epidemic. I can't believe, you know, ANTIFA is a domestic terrorist organization. It's shocking that the FBI is not taking this more serious. What's happening now is Muslim brotherhood funds basically the cyber caliphate. The whole point of cyber caliphate is to create awareness, instill the illusion of rampant xenophobia for recruiting. They have self-radicalized wound collectors with ANTIFA that are already extremists anyway. They're just looking for a reason to take that up a notch. That's when, cyber caliphate, they hook up with them with a hashtag. They respond and they create a relationship. >> John: They get the fly wheel going. >> They take them to a deep web forum, dark web forum, and start showing them how it works. You can do this. You can be part of something. This guy who was never even muslim now is going under the ISIS moniker and he acts. He drives people over in New York. >> They fossilized their belief system. >> The whole point to the cyber caliphate is to find actors that are already in the self-radicalization phase but what does it take psychologically and from a mentoring perspective, to get them to act? That's the cyber caliphate. >> This is the value of data and context in real time using the current events to use that data, refuel their operation. It's data driven terrorism. >> What's the prescription that you're advising? >> I'm not a regulations kind of guy, but any time you're curating metadata like we're just talking about right now. Any time you have organizations like google, like Facebook, that have become so big, they are like their own nation state. That's a dangerous thing. The metadata curation. >> John: The value of the data is very big. That's the point. >> It is because what's happening... >> John: There's always a vulnerability. >> There's always a vulnerability and it will be exploited and all that metadata, it's unscrubbed. I'm not worried about them selling metadata that's scrubbed. I'm worried about the nation state or the sophisticated actor that already has a remote access Trojan on the network and is exfiltrating in real time. That's the guy that I'm worried about because he can just say, "forget it, I'm going to target people that are at this phase." He knows how to write algorithms, comes up with a good psychographic algorithm, puts the data in there, and now he's like, "look I'm only going to promote this concept, "two people at this particular stage of self-radicalization "or sympathetic to the kremlin." We have a big problem on the college campuses with IP theft because of the Chinese Students Scholar Associations which are directly run by the Chinese communist party. >> I heard a rumor that Equifax's franchising strategy had partners on the VPN that were state sponsored. They weren't even hacking, they had full access. >> There's a reason that the Chinese are buying hotels. They bought the Waldorf Astoria. We do stuff with the UN and NATO, you can't even stay there anymore. I think it's still under construction but it's a no-no to stay there anymore. I mean western nations and allies because they'll have bugs in the rooms. The WiFi that you use... >> Has fake certificates. >> Or there's a vulnerability that's left in that network so the information for executives who have IP or PII or electronic health records, you know what I mean? You go to these places to stay overnight, as an executive, and you're compromised. >> Look what happened with Eugene Kaspersky. I don't know the real story. I don't know if you can comment, but someone sees that and says, "this guy used to have high level meetings "at the Pentagon weekly, monthly." Now he's persona non grata. >> He fell out of favor, I guess, right? It happens. >> James, great conversation. Thanks for coming on the Cube. Congratulations on the great work you guys are doing here at the event. I know the content has been well received. Certainly the key notes we saw were awesome. CSOs, view from the government, from industry, congratulations. James Scott who is the co founder and senior fellow of ICIT, Internet Critical Infrastructure Technology. >> James: Institute of Critical Infrastructure Technology. >> T is for tech. >> And the Center for Cyber Influence Operations Studies. >> Good stuff. A lot of stuff going on (mumbles), exploits, infrastructure, it's all mainstream. It's the crisis of our generation. There's a radical shift happening and the answers are all going to come from industry and government coming together. This is the Cube bringing the data, I'm John Furrier with Dave Vellante. Thanks for watching. More live coverage after this short break. (music)

>> Live from Midtown Manhattan, it's the CUBE. Covering Big Data New York City 2017. Brought to you by SiliconANGLE Media and its ecosystem sponsors. >> Fifth year of coverage of our own event Big Data NYC where we cover all the action in New York City. For this week in big data, in conjunction with Strata Data which was originally Hadoop World in 2010. We've been covering it for eight years. It became Strata Conference, Strata Hadoop, now called Strata Data. Will probably called Strata AI tomorrow. Who knows, but certainly the trends are going in that direction. I'm John Furrier, your co-host. Our next guest here in New York City is Sergei Rabotai, who is the Head of Business Development at InData Labs from Belarus. In town, doing some biz dev in the big data ecosystem. Welcome to theCUBE. >> Yeah. Good morning. >> Great to have you. So, obviously Belarus is becoming known as the Silicon Valley of Eastern Europe. A lot of great talent. We're seeing that really explode. A lot of great stuff going on globally, even though there's a lot of stuff, you know GDPR and all these other things happening. It's clearly a global economy with tech. Silicon Valley still is magical. I live there in Palo Alto but you're starting to see peering points within these ecosystems of entrepreneurship and now big companies are taking advantage of it as well. What do you guys do? I mean you're in the middle of that. What is InData Labs do in context of all this? >> Well, InData Labs is a full stack data science company. Which means that we provide professional services for data strategy, big data engineering and the data science. So, yeah, like you just said, we are based - my team is based in Minsk, Belarus. We are about 40 people strong at the moment. And in our recent years we have been very successful starting this business and we have been getting customers from all over the world, including United States, Great Britain, and European Union. The company was launched about four years ago and very important thing, that it was launched by two tech leaders who come from very data-driven industries. Our CEO, Ilya Kirillov, has been running several EdTech companies for many years. Our second founder, Marat Karpeko, has been holding C-Level positions in one of the most successful gaming companies in the world. >> John: So they know data. They're data guys. >> Yeah they're data guys. They know data from different aspects and that brings synergy to our business. >> You guys bring that expertise now into professional services for us. Give me an example of some of the things someone might want to call you up on, because the thing we're hearing here in New York City this week is look, we need more data sciences and they got to be more productive. They're spending way too much time wrangling and doing stuff that they shouldn't be doing. In the old days, sysadmins were built to let people be productive and they ran the infrastructure. That's not what data scientists should be doing. They're the users. There's a level of setting things up and then there's a level of provisioning, it's actually data assets, but then the data scientists just want to do their job. How do you help companies do that? >> Well I would probably, if I take all of our activities, I would split them into two big parts. First of all, we are helping big companies, who already have a lot of data. We help them in managing this data more effectively. We help them with predictive analytics. We help them with, helping them build the churn prediction and user segmentation solutions. We have been recently involved into several natural language processing projects. In one of our successful key studies we helped one of the largest gaming companies to automate their customer feedback processing. So, like, a couple years ago they were working manually with their customer feedback and we built them a tool that allows them to instantly get the sentiment of what the user says. It's kind of like a voice of a customer, which means they can be more effective in developing new things for their games. So, we-- >> So what would someone engage? I'm just trying to peg a order of magnitude of the levels of engagements you do. Startups come in? Is it big companies? What kind of size scoped work do you do? >> So I would say at the moment we work with startups, but it's a bit of a different approach than we have with big or well-established companies. When startups typically approach us with asking to help them implement some brand new technologies like neural networks or deep learning. So they want to be effective from the start. They want to use the cutting edge technology to be more attractive, to provide a better value on the market and just to be effective and to be a successful business from the start. The other part, the well-established companies, who already have the data but they understand that so far their data might not be used that effectively as it should have been used. Therefore, they approach us with a request to help them to get more insights out of the data. Let's say, implement some machine learning that can help them. >> How about larger companies? What kind of projects do you work for them? >> It could be a typical project like churn prediction, that is very actual for the companies who have got a lot of customer data. Then it could be companies from such industries like betting industry, where churn is a very big issue. And, the same probably applies to companies who do trading. >> So is scale one of the things you differentiate around? It sounds like your founders have an EdTech background obviously must be a larger, large data set. Is your profile of engagements large scale? Is it ... I'm just trying to get a handle of if someone's watching who, what is the kind of engagements people should be calling you for? Give us an example of that. >> Like, let's say there is a company who has got a lot of customer data, has got some products and they have a problem of churn, or they have a problem of segmenting their customers so they can later address the specific segments of the customers with the right offers at the right time and through the right marketing channel. Then it could be customers or requests where natural text processing is required where we have to automate some understanding of the written or spoken text. Then I should say that we have been getting recently some requests where computer vision skills are required. I think the first stage of AI being really intelligent was the speech recognition and I think nowadays we manage to reach to the level of what we earlier saw in fantastic movies or sci-fi movies. Computer vision is going to be the next leap in all that AI buzz we're having at the moment. >> So you solve, the problem that you solve for customers is data problems. If they're swimming in a lot of data, you can help them. >> Sergei: Yep. >> If they actually want to make that data do things that are cutting edge, you guys can help them. >> Sergei: Yeah. That's-- >> Alright, so here's a question for you. I mean, Belarus has obviously got good things going on. I've heard the press that you guys have been getting, the whole area, and you guys in particular. So I'm a buyer, one of the questions I might ask is "Hey Sergei, how do I know that you'll keep that talent because the churn is always a big problem. I've dealt with outsourcing before and in the US it's hard to keep talent but I've heard there's a churn." How do you guys keep the talent in the country? How do you keep talent on the projects? Is there certain economic rules over there? What's happening in Belarus? Give us the economical. >> Yeah, so, basically what you're saying. The churn problem has always been known for companies who have their development teams in Asian regions. That's a known problem because I have a lot of meetings with clients in the UK and the US, potential prospects, I would say. So they say it is a problem for them. With Belarus, I don't think we have that because from what I know, we have an average churn of under 10 percent. That's the figures across the industry. In smaller companies, the churn is even less and there are specific reasons for that. First of all, that due to Belarusian mentality, we always try to keep to a job that we're having. Yeah? So we do not-- >> John: That's a cultural thing. >> That's just the cultural thing. We do not ... >> You honor, you honor a code, if you will. >> Yeah. >> Okay. >> So, that's one of the things. Another thing is that Belarusian IT industry is very small. We have, I would say, no more than 40 thousand people being involved in different IT companies. The community is very small, so if somebody is hopping jobs from one job to another, it is going to be known and this person is not likely to have like, a good career. >> So job hoppers is kind of like a code of community, honor. Silicon Valley works that way too, by the way. >> Yeah. >> You get identified, that's who you are. >> Yeah. And so nowadays-- >> Economic tax breaks going on over there? What's the government to get involved? >> One of the key things is, the special tax and legal regulations that Belarus has got at the moment. I can definitely say that there is no country in the world that has got the same tax preferences, and the same support from the government. If a Belarusian company, IT company, becomes a part of Belarusian High Tech Park it means the company becomes automatically exempt from BET tax, corporate income tax. The employees of that company having the reliefs on their income, personal income tax rate, and there are a lot more reliefs that make the talent stay in the country. Having this relief for the IT business allows the companies to provide better working conditions for the employees and stop the people from migrating to other parts of the world. That's what we have. >> Sort of created an environment where there's not a lot of migration out of the area. The tech community kind of does it's own policing of behavior for innovation. >> Yeah but I think before those initiatives were adopted there was a certain percentage of people migrating but I think that nowadays even if it happens, yes, you're right, it's not that substantial. >> Great. Tell us ... Great overview of the company and congratulations, it's a good opportunity for folks watching to explore new areas of talent, especially ones that have the work ethic and knowledge you guys have over there. New York here, there's codes here too. Get the job done. Be on time. What's your experience like in New York here? What's your goal this week? What's some of the meetings you're having? Share with the folks kind of your game plan for Big Data NYC. >> Well, yeah, I've really enjoyed my stay here. It, so far, has been a very enjoyable experience. From the business perspective, I had over 10 meetings with the prospective customers. And we are likely to have follow-ups coming in the next couple of weeks. I can definitely say there is a great demand for professional services. You can see that if you go to whichever center you can see there's a lot of jobs being posted on the job boards. It means that there is lack of knowledge here in the US, yeah? One more important thing that I wanted to share with you from my personal observations that USA, UK and maybe Nordic countries, they have very, very strong background for creating the business ideas but Eastern Europe or Eastern European countries and Belarus in particular, they are very strong in actually implementing those ideas. >> Building them. >> Yes, building them. I think we have lots of synergies and we can ... we can ... >> John: Great. >> We can work together. I also got some meetings with our existing customers here in the US and so far we had good experiences. I can see that New York is moving fast. I travel a lot. I've been to over 40 countries in the previous five years and I just ... New York is different. >> It's fun. >> Different. Even different from many other cities in the US. >> Lot of banks are here. Lot of business in New York. New York is a great town. Love New York City. It's one of my favorites. Love coming here as I grew up right across the river in New Jersey. >> Yeah. But, great town, obviously California, Palo Alto, >> Yeah. >> Is a little more softer in terms of weather, but they have a culture there too. Sounds a lot like what's going on in Belarus, so congratulations. If we get some business for you, should we give them theCUBE discount, tell them John sent you and you get 10 percent off? Alright? >> Alright, yes. Sounds great. We can make it a good deal. (laughter) >> Tell them John sent you, you get 10% off. No I'm only kidding because it's services. Congratulations. Final question. What's the number one thing that people are buying for service from you guys? Number one thing. What's the most requested service you provide? >> The most requested services ... First of all, many customers they understand that they have got a lot of data. They want to do something with their data. But before you actually do some implementation you have to do a lot of discovery or preparatory work. I would say, no matter how we end up with a customer, this stage is basically ... The idea of that stage is to identify the ways data science can be implemented and can provide benefits to the business. That's the most important. I think that, like, 95 percent of the customers they approach us with this thing in the first place. And based on the results of that preparatory stage we can then advise the customers. What can they do? Or how they can actually benefit from the existing data? Or what other things they should collect in order to make their business more effective. >> Sergei, thanks for coming on. Belarus has got a lot of builders there. Check 'em out. >> Thanks a lot. >> Builders are critical in this new world. Lots of them with clout, a lot of great opportunities. A lot of builders in Belarus. This is theCUBE, bringing you all the action from New York City. More after this short break. We'll be right back. (theme music) (no audio) >> Hi, I'm John Furrier, the co-founder of SiliconANGLE Media and co-host of theCUBE. I've been in the tech ...