>> From the SiliconANGLE Media office in Boston, Massachusetts, it's theCUBE. Now here's your host, Dave Vellante. >> Hello everybody and welcome to this week's CUBE Insights, powered by ETR. It is Breaking Analysis, but first I'm coming to you from the floor of Cisco Live in Barcelona, and I want to talk about storage. Storage continues to be soft but there are some bright spots. I've been reporting on this for awhile now and I want to dig in and share with you some of the reasons why, maybe give you some forecasts as to what I think is going to happen in the coming months. And of course, we want to look into some of the ETR spending data, and try to parse through that and understand who's winning, who's losing, who's got the momentum, where are the tailwinds and headwinds. So the first thing I want to show you is let's get right into it. What this slide is showing here is a storage spending snapshot of net score. Now remember, net score in the ETR parlance is an indicator of momentum or spending velocity. Essentially every quarter, what ETR does is they go out to, in this case, 1100 respondents out of the 4500 dataset, and they ask them are you spending more or are you spending less. Essentially they subtract the less from the more and that constitutes net score. It's not that simple but for this purpose, that's what we're showing. Now you can see here on the left hand side, I'm showing all respondents out of 1161. You see the January survey net scores. You've got Rubrik, Cohesity, Nutanix, and Pure, and VMware vSAN are the top five. So Rubrik and Cohesity, very strong, and interesting, Rubrik was very strong last quarter. Cohesity not as strong but really shooting up. It kind of surprised me last quarter, Cohesity being a little low but they were early into the dataset and now they're starting to show what I think is really happening in the marketplace. That's a good indicator. But you can see 75 percent, 72 percent. Nutanix still very strong at 56 percent, driving that hyperconverge piece. You see Pure Storage at 44 percent, down a little bit, talk a little bit more about that in a moment. VMware vSAN, Veeam, et cetera, down the list. The thing about the left hand side and storage in general, you can see the softness. Only about one third of the suppliers are in the green, and that's a problem. If you compare this to security, probably three quarters are in the green. It's a much hotter segment. Now, look on the right hand side. The right hand side is showing what ETR calls GPP, giant, public, and private. You can see there's an N of 403. These are the largest, the very largest public and private companies, private company being a company like Mars Candy. And they say that they are the best indicators of spending momentum in the dataset. So really isolating on some of the large companies. Look what happens here. You can see Rubrik gets even stronger as does Cohesity, they're into the 80 percent range. That's really rarefied air, so very strong. You can see Nutanix drops down. It does better in the smaller companies, it appears. They drop down to 41 percent. Pure gets stronger in the GPP at 68 percent. You can see VMware's vSAN uptick to 45 percent. Nimble gets better, HPE's Nimble, to 54 percent. Dell drops down to 4.8 percent. HPE goes up to 33 percent. HPE was red in the left hand side. You can see Veeam drops, not surprising, Veeam in the biggest companies is not going to be as prevalent. We talked about that in our Breaking Analysis segment after the acquisition of Veeam. You can see NetApp bumps up a little bit but it's still kind of in that red zone. I also want to call your attention to Actifio. They're way down on the bottom in the left hand side, which kind of surprised me. And then I started digging into it because I know Actifio does better in the larger companies. In the right hand side, they pop up to 33 percent. It's only an N of three, but what I'm seeing in the marketplace is Actifio solving some really hard problems in database and copy data management. You're starting to see those results as well. But generally speaking, this picture is not great for storage, with the exception of a few players like Rubrik and Cohesity, Pure, Nutanix. And I'm going to get into that a little bit and try to explain what's going on here. The market's bifurcated. Primary storage has been on the back burner for awhile now, and I've been talking about that. The one exception to that is really been Pure. Little bit for Dell EMC coming back, we'll dig into that a little bit more but Pure has been the stand-out. They're even moderating lately, I'll talk about that some more. Secondary storage is where the market momentum is and you can see that with Rubrik and Cohesity. Again, we'll talk about that some more. Let me dig into the primary side. Cloud, as I've talked about in many Breaking Analysis segments is siphoning off demand from on-prem spend. The second big factor in storage has been there was such an injection of flash into the marketplace, it added headroom. Customers used to buy spindles to get performance, and they don't need to do that so much anymore because so much flash was pushed into the system. The third thing is you're still seeing in primary the consolidation dynamics play out with hyperconverge. So hyperconverge is the software defined bringing together of storage, compute, and networking into a single logical managed unit. That is taking share away from traditional primary storage. You're also seeing tactical NAND pricing be problematic for storage suppliers. You saw that with Pure again this past quarter. NAND pricing comes down, which you'd think would be a good thing from a component standpoint, which it is, but it also lowers prices of the systems. So that hurt Pure's revenue. Their unit volume was pretty good but you're seeing that sort of put pressure on prices, so ASPs are down, average system prices. Let's turn our attention to the secondary market for a moment. Huge injection of venture capital, like a billion dollars, half a billion dollars over the last year, and then another five billion just spent on the acquisition of Veeam. A lot of action going on there. You're seeing big TAM expansions where companies like Rubrik and Cohesity, who have garnered much of that VC spending, are really expanding the notion of data protection from back-up into data management, into analytics, into security, and things of that nature, so a much bigger emphasis on TAM expansion, of course as I talked about the M and A. Let's dig into each of these segments. The chart that I'm showing now really digs into primary storage. You can see here the big players, Pure, Dell EMC, HPE, NetApp, and IBM. And lookit, there's only company in the green, Pure. You can see they're trending down just a little bit from previous quarters but still far and away the company with most spending momentum. Again, here I'm showing net score measure of spending velocity back to the January '18 survey. You can see Dell EMC sort of fell and then is slowly coming back up. NetApp hanging in there, Dell EMC, HP, and NetApp kind of converging, and you can see IBM. IBM announced last quarter about three percent growth. I talked about that actually in September. I predicted that IBM storage would have growth because they synchronized their DS8000 high-end mainframe announcement to the z15, so you saw a little bit of uptick in IBM. Pure, as I said, 15 percent growth. I mean, if you're flat in this market or growing at three percent, you're doing pretty well, you're probably a share gainer. We'll see what happens in February when Dell EMC, HPE, and NetApp announce earnings. We'll update you at that time. So that's what you're seeing now. Same story, Pure outpacing the others, everybody else fighting for share. Let's turn our attention now to secondary storage. What I'm showing here is net score for the secondary storage players. I can't isolate on a drill down for secondary storage, last slide I could do on storage overall, but what I can show is pure plays. What's showing here is Rubrik, Cohesity, Veeam, Commvault, and Veritas. Five pure play, you can argue Veritas isn't a pure play, but I consider it a pure play data protection vendor. Look at Rubrik and Cohesity really shooting up to the right, 75 percent and 72 percent net scores, respectively. You see Veeam hanging in there. This is again, all respondents, the full 1100 dataset. Commvault announced last quarter it beat earnings but it's not growing. You can see some pressure there, and you can see Veritas under some pressure as well. You can see a net score really deep in the red, so that's cause for some concern. We'll keep watching that, maybe dig into some of the larger accounts to see how they're doing there. But you can see clear standouts with Rubrik and Cohesity. I want to look at hyperconverge now. Again, I can't drill into hyperconverge but what I can do is show some of the pure plays. So what this slide shows is the net score for some of the pure play hyperconverge vendors led by Nutanix. The relative newcomer here is vSAN with VMware. You can see Dell EMC, VxRail, and Simplivity. I would say this. A lot of the marketing push that you hear out of Dell and out of VMware says Nutanix is in big trouble, they're dying and so forth. Our data definitely shows something different. The one caution is, you can see Nutanix and larger accounts, not as strong. And you can see both vSAN and Dell EMC stronger in those larger accounts. Maybe that's kind of their bias and their observation space, but it's something that we've got to watch. But you can see the net scores here. Everybody's in the green because overall, this is a strong market. Everybody is winning. It's taking share as I said from primary. We're watching that very closely. Nutanix continues to be strong. Watching very carefully that competitive dynamic and the dynamics within those larger companies which are a bellwether. Now the big question that I want to ask here is can storage reverse the ten-year trend of the big cloud sucking sound that we have heard for the past decade. I've been reporting with data on how cloud generally has hurt that storage spend on-prem. So what I'm showing here in this slide is the net score for the cloud spenders. Many hundreds of cloud spenders in the dataset. What we're showing here is the net score, the spending velocity over the last 10 years for the leaders. You can see Dell EMC, the number one. NetApp, right there in terms of market share, IBM as well. I didn't show HPE because the slide got too busy but they'd be up there as well. So these are the big spenders, big on-prem players and you can see, well, it's up and down. The highs are lower and the lows tend to be lower. You can see on the latest surveys, maybe there's some upticks here in some of the companies. But generally speaking, the trend has been down. That siphoning away of demand from the cloud guys. Can that be reversed, and that's something that we're going to watch, so keeping an eye on that. Let me kind of summarize and I'll make some other comments here. One of the things we're going to watch here is Dell EMC, NetApp, and HPE earnings announcements in February. That's going to be a clear indicator. We'll look for what's happening with overall demand, what the growth trajectory looks like, and very importantly, what NAND pricing looks like. As a corollary to that, we're going to be watching elasticity. I firmly believe as prices go down, that more storage is going to bought. That's always been the case. Flash is still only about 20, 25, 30 percent of the market, about 30 percent of the spending, about 20 percent of the terabytes. But as prices come down, expect people to buy more. That's always been the case. If there's an elasticity of demand, it hasn't shown up in the earning statements, and that's a bit of a concern. But we'll keep an eye on that. We're also going to watch the cloud siphoning demand from on-prem spend. Can the big players and guys like Pure and others, new start-ups maybe, reverse that trend. Multi-cloud, there's an opportunity for these guys. Multi-cloud management, TAM expansion into new areas. Actually delivering services in the cloud. You saw Pure announce block storage in the cloud. So that's kind of interesting that we'll watch. Other players may be getting into the data protection space, but as it relates to the cloud, one of the things I'm watching very closely is the TAM expansion of the cloud players. What do I mean by that. Late last year, Amazon announced a broader set of products or services really in its portfolio. Let's watch for Amazon's moves and other big cloud players into the storage space. I fully expect they're going to want to get a bigger piece of that pie. Remember, much if not most of Amazon's revenue comes from compute. They really haven't awakened to the great storage opportunity that's out there. Why is that important. You saw this play out on-prem. Servers became a really tough market. Intel made all the money. Amazon is a huge customer of Intel, and Intel's getting a big piece of Amazon's EC2 business. That's why you see, in part, Amazon getting into its own chip design. I mean, in the server business, you're talking about low gross margin business. If you're in the 20s or low 30s, you're thrilled. Pure last quarter had 70 plus percent gross margins. It's been a 60 plus percent gross margin business consistently. You're going to see the cloud guys wake up to that and try to grab even more share. It's going to be interesting to see how the traditional on-prem vendors respond to that. Coming into last decade, you saw tons of start-ups but only two companies really reached escape velocity: Nutanix and Pure. At the beginning of the century, you saw Data Domain, Isilon, Compellent, 3PAR all went public. EqualLogic and LeftHand got taken out. There are a bunch of other companies that got acquired. Storage was really a great market. Coming into this decade, mid part of the decade, you had lots of VC opportunity here. You had Fusion and Violin, Intentury went public. They all flamed out. You had a big acquisition with SolidFire, almost a billion dollars, but really Pure and Nutanix were the only ones to make it, so the question is, are you going to see anyone reach escape velocity in the next decade, and where's that going to come from. The likely players today would be Cohesity and Rubrik. Those unicorns would be the opportunity. You could argue Veeam, I guess reached it, but hard to tell because Veeam's a private company. By escape velocity, we're talking large companies who go public, have a big exit in the public market and become transparent so we really know what's going on there. Will it come from a cloud or a cloud native play. We'll see. Are there others that might emerge, like a Nebulon or a Clumio. A company like Infinidat's doing well, will they hit escape velocity and do an IPO and again, become more transparent. That's again something that we're watching, but you're clearly seeing moves up the stack where there's a lot more emphasis in spending on cloud, cloud native. We clearly saw it with hyperconverge consolidation but up the stack towards the apps, really driving digital transformations. People want to spend less on heavy lifting like storage. They're always going to need storage. But is it going to be the same type of market it has been for the last 30 or 40 years, of great investment opportunities. We're starting to see that wane but we'll keep track of it. Thank you for watching this Breaking Analysis, this is CUBE Insights powered by ETR. This is Dave Vellante. We'll see you next time.

>> From the Silicon Angle Media office in Boston Massachusetts, it's theCUBE. Now here's your host, Dave Vellante. (upbeat music) >> Hello everybody, this is Dave Vallante with Stu Miniman and we're going to take a look back at ten years of theCUBE at VMworld and look forward to see what's coming next. So, as I say, this is theCUBE's 10th year at VMworld, that's VMworld, of course 2019. And Stu, if you think about the VMware of 2010, when we first started, it's a dramatically different VMware today. Let's look back at 2010. Paul Maritz was running VMware, he set forth the vision of the software mainframe last decade, well, what does that mean, software mainframe? Highly integrated hardware and software that can run any workload, any application. That is the gauntlet that Tucci and Maritz laid down. A lot of people were skeptical. Fast forward 10 years, they've actually achieved that, I mean, essentially, it is the standard operating system, if you will, in the data center, but there's a lot more to the story. But you remember, at the time, Stu, it was a very complex environment. When something went wrong, you needed guys with lab coats to come in a figure out, you know, what was going on, the I/O blender problem, storage was a real bottleneck. So let's talk about that. >> Yeah, Dave, so much. First of all, hard to believe, 10 years, you know, think back to 2010, it was my first time being at VMworld, even though I started working with VMware back in 2002 when it was like, you know, 100, 150 person company. Remember when vMotion first launched. But that first show that we went to, Dave, was in San Francisco, and most people didn't know theCUBE, heck, we were still figuring out exactly what theCUBE will be, and we brought in a bunch of our friends that were doing the CloudCamps in Silicon Valley, and we were talking about cloud. And there was this gap that we saw between, as you said, the challenges we were solving with VMware, which was fixing infrastructure, storage and networking had been broken, and how were we going to make sure that that worked in a virtual environment even better? But there were the early thought leaders that were talking about that future of cloud computing, which, today in 2019, looks like we had a good prediction. And, of course, where VMware is today, we're talking all about cloud. So, so many different eras and pieces and research that we did, you know, hundreds and hundreds of interviews that we've done at that show, it's definitely been one of our flagship shows and one of our favorite for guests and ecosystems and so much that we got to dig into at that event. >> So Tod Nielsen, who was the President and probably COO at the time, talked about the ecosystem. For every dollar spent on a VMware license, $15 was spent on the ecosystem. VMware was a very, even though they were owned by EMC, they were very, sort of, neutral to the ecosystem. You had what we called the storage cartel. It was certainly EMC, you know, but NetApp was right there, IBM, HP, you know, Dell had purchased EqualLogic, HDS was kind of there as well. These companies were the first to get the APIs, you remember, the VASA VAAI. So, we pushed VMware at the time, saying, "Look, you guys got a storage problem." And they said, "Well, we don't have a lot of resources, "we're going to let the ecosystem solve the problem, "here's an API, you guys figure it out." Which they largely did, but it took a long time. The other big thing you had in that 2010 timeframe was storage consolidation. You had the bidding war between Dell and HP, which, ultimately, HP, under Donatelli's leadership, won that bidding war and acquired 3PAR >> Bought 3PAR >> for 2.4, 2.5 billion, it forced Dell to buy Compellent. Subsequently, Isilon was acquired, Data Domain was acquired by EMC. So you had this consolidation of the early 2000s storage startups and then, still, storage was a major problem back then. But the big sea change was, two things happened in 2012. Pat Gelsinger took over as CEO, and VMware acquired Nicira, beat Cisco to the punch. Why did that change everything? >> Yeah, Dave, we talked a lot about storage, and how, you know, the ecosystem was changing this. Nicira, we knew it was a big deal. When I, you know, I talked to my friends that were deep in networking and I talked with Nicira and was majorly impressed with what they were doing. But this heterogeneous, and what now is the multi-cloud environment, networking needs to play a critical role. You see, you know, Cisco has clearly targeted that environment and Nicira had some really smart people and some really fundamental technology underneath that would allow networking to go just beyond the virtual machine where it was before, the vSwitch. So, you know, that expansion, and actually, it took a little while for, you know, the Nicira acquisition to run into NSX and that product to gain maturity, and to gain adoption, but as Pat Gelsinger has said more recently, it is one of the key drivers for VMware, getting them beyond just the hypervisor itself. So, so much is happening, I mean, Dave, I look at the swings as, you know, you said, VMware didn't have enough resources, they were going to let the ecosystem do it. In the early days, it was, I chose a server provider, and, oh yeah, VMware kind of plays in it. So VMware really grew how much control and how much power they had in buying decisions, and we're going through more of that change now, as to, as they're partnering we're going to talk about AWS and Microsoft and Google as those pieces. And Pat driving that ship. The analogy we gave is, could Pat do for VMware what Intel had done for a long time, which is, you have a big ecosystem, and you slowly start eating away at some of that other functionality without alienating that ecosystem. And to Pat's credit, it's actually something that he's done quite well. There's been some ebbs and flows, there's pushback in the community. Those that remember things like the "vTax," when they rolled that out. You know, there's certain features that the rolled into the hypervisor that have had parts of the ecosystem gripe a little bit, but for the most part, VMware is still playing well with the ecosystem, even though, after the Dell acquisition of EMC, you know, we'll talk about this some more, that relationship between Dell and VMware is tighter than it ever was in the EMC days. >> So that led to the Software-Defined Data Center, which was the big, sort of, vision. VMware wanted to do to storage and networking what it had done to compute. And this started to set up the tension between with VMware and Cisco, which, you know, lives on today. The other big mega trend, of course, was flash storage, which was coming into play. In many ways, that whole API gymnastics was a Band-Aid. But the other big piece if it is Pat Gelsinger was much more willing to integrate, you know, some of the EMC technologies, and now Dell technologies, into the VMware sort of stack. >> Right, so Dave, you talked about all of those APIs, Vvols was a huge multi-year initiative that VMware worked on and all of the big storage players were talking about how that would allow them to deeply integrate and make it virtualization-aware storage your so tense we come out on their own and try to do that. But if you look at it, VVols was also what enabled VMware to do vSAN, and that is a little bit of how they can try to erode in some of the storage piece, because vSAN today has the most customers in the hyperconverged infrastructure space, and is keeping to grow, but they still have those storage partnerships. It didn't eliminate it, but it definitely adds some tension. >> Well it is important, because under EMC's ownership it was sort of a let 1,000 flowers bloom sort of strategy, and today you see Jeff Clarke coming in and consolidating the portfolios, saying, "Look, let's let VMware go hard with vSAN." So you're seeing a different type of governance structure, we'll talk about that. 2013 was a big year. That's the year they brought in Sanjay Poonen, they did the AirWatch acquisition, they took on what the industry called VDI, what VMware called EUC, End-User Computing. Citrix was the dominant player in that space, VMware was fumbling, frankly. Sanjay Poonen came in, the AirWatch acquisition, now, VMware is a leader in that space, so that was big. The other big thing in 2013 was, you know, the famous comment by Carl Eschenbach about, you know, if we lose to the book seller, we'll all lose. VMware came out with it's cloud strategy, vCloud Air. I was there with the Wall Street analyst that day listening to Pat explain that and we were talking afterwards to a number of the Wall Street analysts saying, "This really doesn't make a lot of sense." And then they sort of retreated on that, saying that it was going to be an accelerant, and it just was basically a failed cloud strategy. >> And Dave, that 2013 is also when they spun out Cloud Foundry and founded Pivital. So, you know, this is where they took some of the pieces from EMC, the Greenplum, and they took some of the pieces from VMware, Spring and the Cloud Foundation, and put those together. As we speak right now, there was just an SEC Filing that VMware might suck them back in. Where I look at that, back in 2013, there was a huge gap between what VMware was doing on the infrastructure side and what Cloud Foundry was doing on the application modernization standpoint, they had bought the Pivotal Labs piece to help people understand new programming models and everything along those lines. Today, in 2019, if you look at where VMware is going, the changes happening in containerization, the changes happening from the application down, they need to come together. The Achilles heel that I have seen from VMware for a long time is that VMware doesn't have enough a tie to or help build the applications. Microsoft owns the applications, Oracle owns the applications. You know, there are all the ISVs that own the applications, and Pivotal, if they bring that back into VMware it can help, but it made sense at the time to kind of spin that out because it wasn't synergies between them. >> It was what I called at the time a bunch of misfit toys. And so it was largely David Goulden's engineering of what they called The Federation. And now you're seeing some more engineering, financial engineering, of having VMware essentially buy another, you know, Dell Silver Lake asset, which, you know, drove the stock price up 77% in a day that the Dow dropped 800 points. So I guess that works, kind of funny money. The other big trend sort of in that mid-part of this decade, hyperconverged, you know, really hit. Nutanix, who was at one point a strong partner of both VMware and Dell, was sort of hitting its groove swing. Fast forward to 2019, different situation, Nutanix really doesn't have a presence there. You know, people are looking at going beyond hyperconverged. So there's sort of the VMware ecosystem, sort of friendly posture has changed, they point fingers at each other. VMware says, "Well, it's Nutanix's fault." Nutanix will say it's VMware's fault. >> Right, so Dave, I pointed out, the Achilles heel for VMware might be that they don't have the closest tie to the application, but their greatest strength is, really, they are really the data center operating system, if you will. When we wrote out our research on Server SAN was before vSAN had gotten launched. It was where Nutanix, Scale Computing, SimpliVity, you know, Pivot3, and a few others were early in that space, but we stated in our research, if Microsoft and VMware get serious about that space, they can dominate. And we've seen, VMware came in strong, they do work with their partnerships. Of course, Dell, with the VxRail is their largest solution, but all of the other server providers, you know, have offerings and can put those together. And Microsoft, just last year, they kind of rebranded some of the Azure Stack as HCI and they're going strong in that space. So, absolutely, you know, strong presence in the data center platform, and that's what they're extending into their hybrid and multi-cloud offering, the VMware Cloud Solutions. >> So I want to get to some of the trends today, but just real quick, let's go through some of this. So 2015 was the big announcement in the fall where Dell was acquiring EMC, so we entered, really, the Dell era of VMware ownership in 2016. And the other piece that happened, really 2016 in the fall, but it went GA 2017, was the announcement AWS and VMware as the preferred partnership. Yes, AWS had a partnership with IBM, they've subsequently >> VMware had a partnership >> Yeah, sorry, VMware has a partnership with IBM for their cloud, subsequently VMware has done deals with Google and Microsoft, so there's, we now have entered the multi-cloud hybrid world. VMware capitulated on cloud, smart move, cleaned up its cloud strategy, cleaned that AirWatch mess. AWS also capitulated on hybrid. It's a term that they would never use, they don't use it necessarily a lot today, but they recognize that On Prem is a viable portion of the marketplace. And so now we've entered this new era of cloud, hybrid cloud, containers is the other big trend. People said, "Containers are going to really hurt VMware." You know, the jury's still out on that, VMware sort of pushes back on that. >> And Dave, just to put a point on that, you know, everybody, including us, spent a lot of time looking at this VMware Cloud on AWS partnership, and what does it mean, especially, to the parent, you know, Dell? How do they make that environment? And you've pointed out, Dave, that while VMware gets in those environments and gives themselves a very strong cloud strategy, AWS is the key partner, but of course, as you said, Microsoft Azure, Google Cloud, and all the server providers, we have a number of them including CenturyLink and Rackspace that they're partnering with, but we have to wait a little while before Amazon, when they announced their outpost solutions, VMware is a critical software piece, and you've got two flavors of the hardware. You can run the full AWS Stack, just like what they're running in their data center, but the alternative, of course, is VMware software running on Dell hardware. And we think that if VMware hadn't come in with a strong position with Amazon and their 600,000 customers, we're not sure that Amazon would have said, "Oh yeah, hey, you can run that same software stack "that you're running, but run some different hardware." So that's a good place for Dell to get in the environment, it helps kind of close out that story of VMware, Dell, and AWS and how the pieces fit together. >> Yeah, well so, by the way, earlier this week I privately mentioned to a Dell executive that one of the things I thought they should do was fold Pivotal into VMware. By the way, I think they should go further. I think they should look at RSA and Dell Boomi and SecureWorks, make VMware the mothership of software, and then really tie in Dell's hardware to VMware. That seems to me, Stu, the direction that they're going to try to gain an advantage on the balance of the ecosystem. I think VMware now is in a position of strength with, what, 5 or 600,000 customers. It feels like it's less ecosystem friendly than it used to be. >> Yeah, Dave, there's no doubt about it. HPE and IBM, who were two of the main companies that helped with VMware's ascendancy, do a lot of other things beyond VMware. Of course, IBM bought Red Hat, it is a key counterbalance to what VMware is doing in the multi-cloud. And Dave, to your point, absolutely, if you look at Dell's cloud strategy, they're number one offering is VMware, VMware cloud on Dell. Dell as the project dimension piece. All of these pieces do line up. I'll say, some of those pieces, absolutely, I would say, make sense to kind of pull in and shell together. I know one of the reasons they keep the security pieces at arm's length is just, you know, when something goes wrong in the security space, and it's not of the question of if, it's a question of when, they do have that arm's length to be able to keep that out and be able to remediate a little bit when something happens. >> So let's look at some of the things that we're following today. I think one of the big ones is, how will containers effect customer spending on VMware? We know people are concerned about the vTax. We also know that they're concerned about lock-in. And so, containers are this major force. Can VMware make containers a tailwind, or is it a headwind for them? >> So you look at all the acquisitions that they've made lately, Dave, CloudHealth is, from a management standpoint, in the public cloud. Heptio and Bitnami, targeting that cloud native space. Pair that with Cloud Foundry and you see, VMware and Pivotal together trying to go all-in on Kubernetes. So those 600,000 customers, VMware wants to be the group that educates you on containerization, Kubernetes, you know, how to build these new environments. For, you know, a lot of customers, it's attractive for them to just stay. "I have a relationship, "I have an enterprise licensing agreement, "I'm going to stay along with that." The question I would have is, if I want to do something in a modern way, is VMware really the best partner to choose from? Do they have the cost structure? A lot of these environments set up, you know, it's open source base, or I can work with my public cloud providers there, so why would I partner with VMware? Sure, they have a lot of smart people and they have expertise and we have a relationship, but what differentiates VMware, and is it worth paying for that licensing that they have, or will I look at alternatives? But as VMware grows their hybrid and multi-cloud deployments they absolutely are on the short list of, you know, strategic partners for most customers. >> The other big thing that we're watching is multi-cloud. I have said over and over that multi-cloud has largely been a symptom of multi-vendor. It's not necessarily, to date anyway, been a strategy of customers. Having said that, issues around security, governance, compliance have forced organizations and boards to say, "You know what, we need IT more involved, "let's make multi-cloud part of our strategy, "not only for governance and compliance "and making sure it adheres to the corporate edicts, "but also to put the right workload on the right cloud." So having some kind of strategy there is important. Who are the players there? Obviously VMware, I would say, right now, is the favorite because it's coming from a position of strength in the data center. Microsoft with it's software state, Cisco coming at it from a standpoint of network strength. Google, with Anthos, that announcement earlier this year, and, of course, Red Hat with IBM. Who's the company that I didn't mention in that list? >> Well, of course, you can't talk about cloud, Dave, without talking about AWS. So, as you stated before, they don't really want to talk about hybrid, hey, come on, multi-cloud, why would you do this? But any customer that has a multi-cloud environment, they've got AWS. And the VMware-AWS partnership is really interesting to watch. It will be, you know, where will Amazon grow in this environment as they find their customers are using multiple solutions? Amazon has lots of offerings to allow you leverage Kubernetes, but, for the most part, the messaging is still, "We are the best place for you, "if you do everything on us, "you're going to get better pricing "and all of these environments." But as you've said, Dave, we never get down to that homogeneous, you know, one vendor solution. It tends to be, you know, IT has always been this heterogeneous mess and you have different groups that purchase different things for different reasons, and we have not seen, yet, public cloud solving that for a lot of customers. If anything we often have many more silos in the clouds than we had in the data center before. >> Okay. Another big story that we're following, big trend, is the battle for networking. NSX, the software networking component, and then Cisco, who's got a combination of, obviously, hardware and software with ACI. You know, Stu, I got to say, Cisco a very impressive company. You know, 60+% market share, being able to hold that share for a long time. I've seen a lot of companies try to go up against Cisco. You know, the industry's littered with failures. It feels, however, like NSX is a disruptive force that's very hard for Cisco to deal with in a number of dimensions. We talked about multi-cloud, but networking in general. Cisco's still a major player, still, you know, owns the hardware infrastructure, obviously layering in its own software-defined strategy. But that seems to be a source of tension between the two companies. What's the customer perspective? >> Yeah, so first of all, Dave, Cisco, from a hardware perspective, is still going strong. There are some big competitors. Arista has been doing quite well into getting in, especially, a high performance, high speed environments, you know, Jayshree Ullal and that team, you know, very impressive public company that's doing quite well. >> Service providers that do really well there. >> Absolutely, but, absolutely, software is eating the world and it is impacting networking. Even when you look at Cisco's overall strategy, it is in the future. Cisco is not a networking company, they are a software company. The whole DevNet, you know, group that they have there is helping customers modernize, what we were talking about with Pivotal. Cisco is going there and helping customers create those new environments. But from a customer standpoint, they want simplicity. If my VMware is a big piece of my environment, I've probably started using NSX, NSX-T, some of these environments. As I go to my service providers, as I go to multi-cloud, that NSX piece inside my VMware cloud foundation starts to grow. I remember, Dave, a few years back, you know, Pat Gelsinger got up on a stage and was like, "This is the biggest collection of network administrators that we've ever seen!" And everybody's looking around and they're like, "Where? "We're virtualization people. "Oh, wait, just because we've got vNICs and vSwitches "and things like that." It still is a gap between kind of a hardcore networking people and the software state. But just like we see on storage, Dave, it's not like vSAN, despite it's thousands and thousands of customers, it is not the dominant player in storage. It's a big player, it's a great revenue stream, and it is expanding VMware beyond their core vSphere solutions. >> Back to Cisco real quickly. One of the things I'm very impressed with Cisco is the way in which they've developed infrastructures. Code with the DevNet group, how CCIEs are learning Python, and that's a very powerful sort of trend to watch. The other thing we're watching is VMware-AWS. How will it affect spending, you know, near-term, mid-term, long-term? Clearly it's been a momentum, you know, tailwind, for VMware today, but the questions remains, long-term, where will customers place their bets? Where will the spending be? We know that cloud is growing dramatically faster than On Prem, but it appears, at least in the near- to mid-term, for one, two, maybe three more cycles, maybe indefinitely, that the VMware-AWS relationship has been a real positive for VMware. >> Yeah, Dave, I think you stated it really well. When I talked to customers, they were a bit frozen a couple of years ago. "Ah, I know I need to do more in cloud, "but I have this environment, what do I do? "Do I stay with VMware, do I have to make a big change." And what VMware did, is they really opened things up and said, "Look, no, you can embrace cloud, and we're there for you. "We will be there to help be that bridge to the future, "if you will, so take your VMware environment, "do VMware cloud in lots of places, "and we will enable that." What we know today, the stat that we hear all the time, the old 80/20 we used to talk about was 80% keeping the lights on, now the 80% we hear about is, there's only 20% of workloads that are in public cloud today. It doesn't mean that that other 80% is going to flip overnight, but if you look over the next five to ten years, it could be a flip from 80/20 to 20/80. And as that shift happens, how much of that estate will stay under VMware licenses? Because the day after AWS made the announcement of VMware cloud on AWS, they offered some migration services. So if you just want to go on natively on the public cloud, you can do that. And Microsoft, Google, everybody has migration services, so use VMware for what I need to, but I might go more native cloud for some of those other environments. So we know it is going to continue to be a mix. Multi-cloud is what customers are doing today, and multi- and hybrid-cloud is what customers will be doing five years from now. >> The other big question we're watching is Outposts. Will VMware and Outposts get a larger share of wallet as a result of that partnership at the expense of other vendors? And so, remains to be seen, Outposts grabbed a lot of attention, that whole notion of same control plane, same hardware, same software, same data plane On Prem as in the Data Center, kind of like Oracle's same-same approach, but it's seemingly a logical one. Others are responding. Your thoughts on whether or not these two companies will dominate or the industry will respond or an equilibrium. >> Right, so first of all, right, that full same-same full stack has been something we've been talking about now, feels like for 10 years, Dave, with Oracle, IBM had a strategy on that, and you see that, but one of the things with VMware has strong strength. What they have over two decades of experiences on is making sure that I can have a software stack that can actually live in heterogeneous environments. So in the future, if we talk about if Kubernetes allows me to live in a multi-cloud environment, VMware might be able to give me some flexibility so that I can move from one hardware stack to another as I move from data centers to service providers to public clouds. So, absolutely, you know, one to watch. And VMware is smart. Amazon might be their number one partner, but they're lining up everywhere. When you see Sanjay Poonen up on stage with Thomas Kurian at Google Cloud talking about how Anthos in your data center very much requires VMware. You see Sachi Nodella up on stage talking about these kind of VMware partnerships. VMware is going to make sure that they live in all of these environments, just like they lived on all of the servers in the data center in the past. >> The other last two pieces that I want to touch on, and they're related is, as a result of Dell's ownership of VMware, are customers going to spend more with Dell? And it's clear that Dell is architecting a very tight relationship. You can see, first of all, Michael Dell putting Jeff Clarke in charge of everything Dell was brilliant, because, in a way, you know, Pat was kind of elevated as this superstar. And Michael Dell is the founder, and he's the leader of the company. So basically what he's created is this team of rivals. Now, you know, Jeff and Pat, they've worked together for decades, but very interesting. We saw them up on stage together, you know, last year, well I guess at Dell Technologies World, it was kind of awkward, but so, I love it. I love that tension of, It's very clear to me that Dell wants to integrate more tightly with VMware. It's the clear strategy, and they don't really care at this point if it's at the expense of the ecosystem. Let the ecosystem figure it out themselves. So that's one thing we're watching. Related to that is long-term, are customers going to spend more of their VMware dollars in the public cloud? Come back to Dell for a second. To me, AWS is by far the number one competitor of Dell, you know, that shift to the cloud. Clearly they've got other competitors, you know, NetApp, Huawei, you know, on and on and on, but AWS is the big one. How will cloud spending effect both Dell and AWS long-term? The numbers right now suggest that cloud's going to keep growing, $35, $40 billion run-rate company growing at 40% a year, whereas On Prem stuff's growing, you know, at best, single digits. So that trend really does favor the cloud guys. I talked to a Gartner analyst who tracks all this stuff. I said, "Can AWS continue to grow? It's so big." He said, "There's no reason, they can't stop. "The market's enormous." I tend to agree, what are your thoughts? >> Yeah, first of all, on the AWS, absolutely, I agree, Dave. They are still, if you look at the overall IT spend, AWS is still a small piece. They have, that lever that they have and the influence they have on the marketplace greatly outweighs the, you know, $30, $31 billion that they're at today, and absolutely they can keep growing. The one point, I think, what we've seen, the best success that Dell is having, it is the Dell and VMware really coming together, product development, go to market, the field is tightly, tightly, tightly alligned. The VxRail was the first real big push, and if they can do the same thing with the vCloud foundation, you know, VMware cloud on Dell hardware, that could be a real tailwind for Dell to try to grow faster as an infrastructure company, to grow more like the software companies or even the cloud companies will. Because we know, when we've run the numbers, Dave, private cloud is going to get a lot of dollars, even as public cloud continues its growth. >> I think the answer comes down to a couple things. Because right now we know that 80% of the spend and stall base is On Prem, 20% in the cloud. We're entering now the cloud 2.0, which introduces hybrid-cloud, On Prem, you know, connecting to clouds, multi-cloud, Kubernetes. So what it comes down to, to me Stu, is to what degree can Dell, VMware, and the ecosystem create that cloud experience in a hybrid world, number one? And number two, how will they be able to compete from a cost-structure standpoint? Dell's cost-structure is better than anybody else's in the On Prem world. I would argue that AWS's cost-structure is better, you know, relative to Dell, but remains to be seen. But really those two things, the cloud experience and the cost-structure, can they hold on, and how long can they hold on to that 80%? >> All right, so Dave here's the question I have for you. What are we talking about when we're talking about Dell plus VMware and even add in Pivotal? It's primarily hardware plus software. Who's the biggest in that multi-cloud space? It's IBM plus Red Hat, which you've stated emphatically, "This is a services play, and IBM has, you know, "just got, you know, services in their DNA, "and that could help supercharge where Red Hat's going "and the modernization." So is that a danger for Dell? If they bring in Pivotal, do they need to really ramp up that services? How do they do that? >> Yeah, I don't think it's a zero sum game, but I also don't think there's, it's five winners. I think that the leader, VMware right now would be my favorite, I think it's going to do very well. I think Red Hat has got, you know, a lot of good market momentum, I think they've got a captive install base, you know, with IBM and its large outsourcing business, and I think they can do pretty well, and I think number three could do okay. I think the other guys struggle. But it's so early, right now, in the hybrid-cloud world and the multi-cloud world, that if I were any one of those five I'd be going hard after it. We know Google's got the dollars, we know Microsoft has the software state, so I can see Microsoft actually doing quite well in that business, and could emerge as the, maybe they're not a long-shot right now, but they could be a, you know, three to one, four to one leader that comes out as the favorite. So, all right, we got to go. Stu, thanks very much for your insights. And thank you for watching and listening. We will be at VMworld 2019. Three days of coverage on theCUBE. Thanks for watching everybody, we'll see you next time. (upbeat music)

>> Massachusetts, it's theCUBE! Covering WTG Transform 2019. Brought to you by Winslow Technology Group. >> Welcome back, I'm Stu Miniman, and we're here at WTG Transform 2019, across the Mass Pike from Fenway Park where we're hoping the rain's going to stop in time for the game tonight where we have 189 users here with Winslow Technology, digging in a lot of technology, networking with their peers, and I'm thrilled to have on another one of the ED users on the program. Plamen Dimitrov is director of Information Technology at Kiawah Island Golf Resorts coming to us from South Carolina. Thank you so much for joining us. >> Thank you for having me. >> All right, as I was actually telling you, I'm familiar with Kiawah, my father is retired down to John's Island right off of Charlestown, South Carolina. You have a beautiful golf course there, there've been professional events there, we actually have one of our Cubeos, does some PGA coverage, John Walls, so he and I have talked about Kiawah a few times, but for those of our audience that aren't as familiar, haven't been able to enjoy it, tell us a little bit about Kiawah. >> Kiawah is a beautiful island, over about 10 miles of oceanfront, side, where the Kiawah Golf Resort is spread out. We have different accommodations with a lot of different activities for all ages, starting with the Sanctuary Hotel, which is a Five Star by Forbes and a Five Diamond by AAA. Or you can choose any of our villas from one to eight bedroom villas. We have five beautiful golf courses, which one of them is ocean course, previously hosted Ryder Cup in 1991, and PGA in 2012, and we are also proud to be a host of the PGA 2021, very exciting. Apart of that, we are announced to be Tennis Resort #1 in the world by tennisresortonline.com. We have over 22 tennis course, different variations from car course to clay. On top of that, we have a lot of pools, swimming pools, water parks, a lot of recreation, kayaking. It can be a beautiful journey for any visitors. >> Yeah, so, Plamen I know some of the IT people listening to this are going to be like, "Boy, he's got a tough job there!" Sounds gorgeous, right on the ocean, so many things there, bring us a little bit inside the IT, your world, what that entails, and, boy, there's got to be some different challenges and opportunities that you face, versus the kind of traditional business IT. >> As every island, we have all of our friends, like salty water and all things like that. And besides that, I've mentioned that the company's spread out over 10 miles, we have a total of 23 locations, and all they share the same systems and applications. Our current challenges, from an IT standpoint, are things that not all of the vendors that can keep up with the current technology and the all new and moderns, so we have some, what we call, old school applications, they can't keep up, and then you have the new applications that can be hosted on the Cloud, for instance. In the same time, those applications need to somewhat work with each other and have some interfaces, so this is where we face the, these days a challenge, a little bit, and where our partnership with Winslow, were able to help us determine which is the best route for us. And we determined that having a data center on island, and they have another one off the island, is the best for us to go. They helped us go through the planning of what's the right set up to be used, and I think we're in the right direction. >> Okay, great, so you have two data centers and you're also using Cloud services, if I heard right? >> Correct. >> Okay. There's been a big discussion here, is like, all right, what is the Cloud's strategy and it is an ever changing world and there is no one right answer, so, when you look at yourselves, what is your Cloud strategy today and what makes you help determine where you'll be moving in the future? >> In one of the sessions, they mentioned it's all about checks and balance, and it's to be able to measure how to apply your cash in a way that it makes sense, and one day, maybe, for some applications makes sense to be on premise, another day makes sense to bring it on the Cloud. And I can give you an example, recently what we did was, we were looking into switching to Office 365, pretty much everybody knows about it, and there's a good study that, after you go over a certain threshold, it's much easier to, and much more cost effective, to have something on premise versus going to a Cloud version. Now, again, it depends on the size of the company, it depends on the... Your future projects and goals, for some people it may be different than us. But I think that the future more and more, things will be what's called colocating the Cloud, which is mainly by other providers, and we're going to have two called a key that you can get to those applications from anywhere. >> Plam, bring us inside a little bit that the data centers, you said you have two of them, what's your infrastructure stack look like today? >> We've been looking at the various solutions, hyper-converged, and hybrids, and with the help of Winslow, we determined that sticking to the 3-2-1 traditional solution is the way we go. We use their Compellent products, all flash erase, very flexible and very reliable, very nice speed it provides, performance-wise they're a great product. Then, after that story solution, you have two data switches and then a number of servers. We use, on top of that, the VMware as our hypervisor, along with their VDI environment called Horizon for some remote clients that they don't need much, but that's basically our setup. >> Great, and how long have you been using the Compellent solutions? >> The Compellent solutions, we've been using them for a year and a half, since I joined the company, but my relationship with Winslow goes far back, since 2013 where I used to work for another company here in Nantucket. And the very first person I worked with was John Cliffords from Winslow. Very great guy, and he introduced us to the Dell world. This is when we bought the first EqualLogic and afterwards, I went to Belmont, where we also bought (mumbles), and we just keep going along. >> All right, great, Plamen, last question I have for you, what brings you to an event like this, what were you hoping to get out of it, and how's it been going for you so far? >> Well, what brings me to an event like this, most of the time is on one side to see what Dell has to offer, and some people attend, they'll conference, but I think a place like this, where you have smaller scale conference, it's much more beneficial for me. A, from a learning experience and B, from creating connections, making connections with other users, which this is the best because sales rep can say, "Yeah, this is what you need." But then, from a user perspective, it's priceless to absorb experience. >> All right, well, Plamen Dimitrov, I really appreciate you sharing your journey, and everything that Kiawah Golf Resorts is doing, thank you so much. >> Thank you very much. >> All right, we'll be back with more coverage here from WTG Transform 2019, I'm Stu Miniman, thanks for watching theCUBE. (funky electro music)

>> Announcer: Live from Chicago, Illinois, it's theCUBE. Covering VeeamOn 2018 brought to you by Veeam. >> We're back at VeeamOn 2018, you're watching theCUBE, the leader in live tech coverage. I'm Dave Vellante with my cohost Stu Miniman. Stu, always great working with you. Bruce Shaw is here, he's the Senior Director of Global Alliances and Industry Solutions at NetApp. Great to see you, thanks for coming on theCUBE. >> Thanks for having me. >> So, I got to start out with NetApp, I mean, we've followed NetApp for decades, ya know, from the very beginning back when I was at IDC, Stu, you were probably still in your mother's womb. (laughing) But you guys are back in a big way, I mean, for a while there it looked vulnerable. You took advantage of the Dell EMC merger. You're gaining share again, you're growing, stock price is up, there's a spring in your step, what's going on? >> Well, a lot of things are going on. I think we've had a lot of leadership additions to the company, Henri Richard joined and took over as the CSO with the company. We've got a new CMO in Jean English. But more importantly, a lot of the areas that we were late to the market, and candidly we've admitted we were late. We didn't have a good Flash story a couple years ago. We've been very aggressive with Flash over the last 24 to 18 months. We're now the fastest growing Flash storage provider out in the market, and we think we'll exit this year as number one. In fact, we think that's the current course and trajectory. We're very happy with where that's going. The FlexPod partnership with Cisco was great this past year. We had a record year in Converged infrastructure, which was a down market, we picked up about 13 points a share according to IDC, so a lot of the cylinders are starting to fire, but the one that is probably the biggest and the most shocking for folks is three, four years ago, the belief was that cloud was going to kill on-prem storage for companies like NetApp. I think the one thing that they did right ahead of the curve was they embraced the cloud. They've got great partnerships with Google, Amazon, the hyperscalers, and cloud strategy and the business that drives the company there is the fastest part of the company, and Anthony Lye runs that team, and it's doing an amazing job. >> Explain how, and you're absolutely right, many, most, frankly myself at times, felt that way. Explain how cloud is a tailwind and not just a one-way street into the roach motel. >> Oh well, there isn't an enterprise today that isn't thinking about cloud in some way, shape, or form, right? Now, ya have prognosticators on either side saying it's all going to the cloud or something less than that, but the truth is when you look at a strategy like ONTAP and the ability to move your data, whether it's on-prem or to the cloud and manage it through our data fabric story, that's where NetApp really starts coming into their own. I think, again, that's where we've been able to take advantage, and it's not just having it one way or the other or being good just with the hyperscalers or good with the guys that want to be secure because most companies do a hybrid story, and they want to bit of both. >> Well, I think the one thing that I would observe about NetApp, having followed the company for many, many years, which I think gives you an advantage, is NetApp really has always had storage services in software that were largely decoupled from the hardware, and that allowed you to get into cloud early, don't ya think, Stu? >> Yeah, absolutely, and Bruce, we're here at VeeamOn, and their message sounds a lot like that to me, so maybe help explain, we were just talking to Veeam's CMO, when you hear some of the descriptions of storage services, software, multicloud, and everything, NetApp and Veeam sound alike. How are they complementary in, ya know, maybe where do they bump up against each other, yeah? >> Yeah, well, we both compete in the same market, which is storage, so of course, there's areas where we're going to compete with each other, but we are very complementary in terms of the story and the markets that we serve, right? NetApp is incredible strong in the enterprise. Veeam has great commercial channel presence, so from a route to market there's a lot of complementary stuff we do with each other. Price point, in terms of where we hit the market and the things that we go after, we have a lot of opportunity where there's not overlap to help each out to the point they're now, the relationship's evolved over the last four years where we're actually doing OEM of each other's products. We've got our E-Series we just announced yesterday that we're OEMing with these guys, which again is targeted at exactly those markets. The story between the two that we're both at our core not hardware companies, not storage companies, but data management companies really is where this starts to come together and play well. The fact that they're mutually supportive of each other makes for a really strong value proposition for the customer and the channel, especially the guys like the service providers or ya know, hybrid cloud providers, it's a big time story for them. >> So you're growing with, the partnership with Veeam is growing. >> Right. >> Ya got a combination of trends that become tailwinds, but then you've got execution. Can you explain what are those tailwinds, and what's the execution ethos with the partnership? >> We are a channel-only company for all intents and purposes. >> Dave: Oh yeah, I don't know what the number is now, but you've always been very, very high performing. >> Yeah, I know, so we look at businesses that we drive, and channel is at the core of what we do, so when you have a tailwind like, ya know, where we are with Flash and the growth there, the channel partners are making more money, the programs that are coming for them, we're not taking business that they're doing today and pushing it towards the cloud. Again, we're talking about the story that's transitory between the two, so for a lot of the channel providers that are out there getting in the market, that's a very powerful story for them. That it's not a competitive business, we're not going to try to create our own cloud service to take away from them. We want to help them as they migrate between the two. >> All right, Bruce, one of the other areas we're hearing a lot about at this show that I think lines up with NetApp is the analytics and AI, can you maybe talk about how that ties into the products? >> Yeah, I mean, you look at a lot of these markets like AI, like analytics in terms of what companies are doing, it sheds off a tremendous amount of data, right? And that data is at the heart of what they want to analyze and go through, and when they bring those things to market, the goal is how I quickly move it from where I'm capturing it to where I need it, and ONTAP does a really good job of doing that in terms of being able to take the data to where they need it, whether it's at the edge or whether it's back at the core of the company, so that you can actually do the real work with it and gain the insights that drive the business. >> Bruce, what's the resale agreement that you have with Veeam, can you explain that? >> We have Veeam on our price list. Our sales reps can sell Veeam, can be compensated for it, vice versa, they can absolutely hook in and drive away with NetApp, and now that we're getting products like E-Series where their product is embedded in ours, that only strengthens that kind of motion. So for a NetApp sales rep today, if they have an opportunity where Veeam is needed on it as part of the offering, it's absolutely in their wheelhouse to go sell it, and they get the sale level of love and attention from quote and comp standpoint that they would if it was NetApp only products. >> So this is kind of interesting innovation that Veeam, I think, has been out in front of, they, and I dunno how they do it, Stu, but I think Veeam understands the lifetime value of a customer and is willing to make, put sweat equity into a deal as part of a partnership to make it transparent to a partner sales force. >> Yeah absolutely. >> That's innovation in business model. >> Absolutely, we're very proud of our sales force and the work that they're able to do. We view ourselves as kind of the last big enterprise standalone storage company that's out there doing this, and I run strategic alliances, and some partners integrate really well with our sales guys. Others, it's more of a, ya know, it requires more work. To your point, Veeam has done a superb job at identifying how and where they play with our folks and getting together where we go to market together. >> It's interesting, we used to, ya know, several years ago now, ask the question can NetApp remain independent. We've seen all these independent storage companies kind of go away. Used to have this conversation with David Scott at 3PAR all the time, EMC itself wasn't able to maintain it, and then NetApp got to the point where it was almost too big for an acquisition, and although stock price was down, everybody, NetApp was the rumor of MNA more than any company I can think of in the storage business, but now you're seeing sort of antithetical to what most people expected, it's kind of like the cloud we were talking about before, storage companies emerged. Pure was the first one over a billion since NetApp. What are your thoughts, and what's that, I wonder what, you guys must talk in the hallways about that whole, the dynamics of the industry. It seems like it's still a viable business model to be best of breed. >> It's very viable, so I took over running the strategic alliances at the beginning of January, and my dance card's full. I can't believe the number of folks that are calling up wanting to partner. I think we've gotten much more mature in terms of how we view the market and our ability to get strategically with other companies to be successful, and there absolutely is always going to be a place out there for a best of breed story. Customers want the best technology that they can get to handle their business needs, and if we partner with great partners, whether it's Veeam or others to provide that for them, I think the viability of NetApp only gets stronger not weaker. >> It's interesting because now ya got NetApp, Pure, Nutanix, soon to be Veeam, as billion dollar independent pure play companies in the storage business. Isilon couldn't get there, Data Domain couldn't get there, Compellent couldn't get there, 3PAR couldn't get there, Lefthand couldn't get, EqualLogic, I can go down the list. They were never able to reach that escape velocity, and maybe it is cloud, maybe cloud is that weird tailwind for people who can figure out how to take advantage of cloud and hybrid cloud, your thoughts? >> Yeah, I think it is, number one. I think also the companies that you mentioned at various times, and I'm a hardware industry dinosaur, I've been around forever. A lot of those companies you talk about the difficult moment from them was hey, we're a storage company, now we want to add compute or now we want to go into this part of the market that put them at odds with the guys they were partnering with. George, our CEO, has been absolutely maniacal with his vision of our path forward is managing data, period. Whatever that form takes, we don't need to be a compute company, we don't need to be a networking company, we want to be a data company. I think how that then drives the decisions, whether it's partnering with cloud, whether it's going into new markets with HCI, even if it's things about transforming the legacy data center from traditional data center and how it's managed on-prem to something that's all Flash driven and much more efficient and much more programmable than it was in the past, so it's easier to administer, those are the areas that we can go innovate, and as long as we're partnering with the right partners out in the industry, that makes us a very good viable destination for the customer without worrying about well, do we have a compute node, are we in the server business now, are we suddenly in the switch business? Those are things that are not even on our radar. >> Yeah, I mean, you guys are in a unique position from that standpoint. You're very large now, you're the largest independent storage company, so everybody wants to work with you. You don't bump up into these adjacencies, and you can make bets, you can place your chips in areas whereas some of the startups, there's tons of innovation, but it's really hard to hit that escape. The amount of resources that you need, the money you need for promotion, the talent war that's going on out there, the go-to-market challenges, the partner challenges, so you guys are in a pretty good position right now. >> We really are, and I think we've actually done a lot of the restructuring internally to continue that and capitalize on it. Probably the biggest change, which outside the company, most folks wouldn't notice immediately, is that we moved at the beginning of this year to a three distinct business unit structure where we're focusing on three parts of the business to go forward. We've got our cloud business unit, which is driving into, as I said, the hyperscalers under Anthony Lye. We've got cloud data center, which is more of the new technologies like HCI and Converge and object storage technology like StorageGRID, and that's, right now that's an incredibly fast growing business for us. Then, of course, we've got our traditional storage software infrastructure business where we have products like E-Series and modernizing the data center, which is primarily driven with this transition to Flash. You've got three BUs now that are maniacally focused on the different areas of the market where we see here's an immediate opportunity in Flash. Here's a slightly longer opportunity in things like hybrid cloud and HCI and Converge infrastructure and a much longer term bet was how does the cloud really become a piece where we're managing between all of those. It lets us be a lot nimble between it. It's almost like three subbusinesses where we're going to market. >> Yeah, Dave, and actually that aligns perfectly with the research we've been doing for over five years from server stand and true private cloud, you've got the hyperscale, you've got the transformation locally in spanning those two, and then you've got that transition from the traditional. >> Oh, I think it's a sound strategy, and it'll serve us well in the years to come. >> There's obviously a lot of noise about artificial intelligence in the marketplace. You've got some companies trying to position to be the platform for machine intelligence or artificial intelligence, what's NetApp's point of view on that? >> Well certainly, we share some of that, but again, I think at the end of the day for us, it's much more important about fine, wherever I'm capturing that artificial intelligence is not likely the place where I'm going to do a lot of the analytics and work on it, so it really does come down to, ya know, am I moving it up to the cloud to do that work, where am I making my big insights, where am I mining through it, and then how am I relating that back, whether it's at the edge or whether it's at the core data center, and again, we think with ONTAP, with the partners that we're going to market with for AI, for ML, IoT, that's the difference maker for us at the end of the day. It's not that we're just another storage company storing the telemetry data off of a car for AI, we're putting it into a format and a form that's usable quickly, efficiently, real time, where Tesla can go make a decision on the car right now, not days, weeks, months from now. >> All right, Bruce, well hey, thanks for coming on theCUBE. Really appreciate your time and good luck. >> Enjoyed having me, thank you. >> All right, great. >> Good to see you guys. >> All right, keep it right there everybody. We'll be back with our next guest. You're watching VeeamOn 2018, this is theCUBE.

>> Announcer: Live from Washington, DC, it's the Cube covering .NEXT Conference, brought to you by Nutanix. >> Welcome back to NEXTConf everybody. This is the Cube, the leader in live tech coverage. My name is Dave Vellante and I'm with Stu Miniman. This is the president's segment. Sudheesh Nair is back. Good to see you again, Sudheesh, the president of Nutanix. And Captain Canada himself, Chad Sakac. >> Dave. >> Cube alum, good friend. >> Dave, it's good to see you. >> Good to see you again. Stu. Hey everybody, most important thing, great, you know, .NEXTConf, but look, Canada Day, July 1st, is right around the corner. So remember, everybody, go have some poutine, drink some beers and celebrate. Then there's this July 4th thing that is apparently right around that. >> Yeah, well, it's important to us, 'cause we've ended an eight-week sprint of the Cube, so. >> Isn't Chad wearing red, white and blue? I think he's, uh ... >> I actually did that on purpose. You noticed! >> Here in DC, nice job. >> I figured when in DC, you know, celebrate Americana. >> Why not? Well, there's a lot of celebration going on here. You guys have been celebrating several years now. What is it? Two and a half years of ... >> With Dell, yes. With Chad it's relatively new, so ... (all laughing) >> It's actually been about three years, and it's been a ridiculously successful partnership. You know, I think ... >> I would say face-meltingly successful, but ... >> Yeah, you know what? I agree. >> Okay, so coming into this role, did you have misconceptions about Nutanix, or was that just marketing, when you were kind of ... >> No. Nutanix basically created the HCI category. They've been at it now for seven and change years. You know, great technology, very happy customers. I'd say out of the 6,200 or so Nutanix customers, roughly around 2,500, 2,700 are XC customers, so I've gotten to know them really well. They tell me pretty clearly what they like about Nutanix and what they like about XC. >> All right, so Chad, I'm looking at my notes here, and there was a guy Chad Sakac who said, "Niche corner case for VDI only," you know, that was Nutanix. >> Love it. >> You know, you're singing a little bit of a different story than we might've heard a couple of years ago. >> You know, I would say that it's important to acknowledge when you're wrong, Stu. You know, and I think that HCI in general has moved absolutely out of any corner case segment whatsoever. I met with a customer this morning that is basically a hospital that is running the bulk of all of their mission-critical customer healthcare records, packs, all on XC. And again, you know, I don't want to get us in trouble here at the .NEXT Conference, but we have an HCI portfolio, we see customers deploying HCI for every workload under the sun at this point. And frankly, I've said it publicly now, firmly and as clearly as I can, SDS and HCI models are ready for the majority of x86 workloads. That's not just my opinion, it's the company, it's Dell Technologies' point of view overall. >> You know, Joe Tucci was the master of sort of building an ecosystem with quasi-competitors, coop-etition, whatever you want to call it, and certainly the Dell/EMC relationship of many years ago was epic, one of the, probably the most successful storage relationship ever. So and, Sudheesh, you get a lot of concerns of Wall Street, when's this going to end? You guys used to get that all the time with Cisco and VC, and yet you continue to ... >> Still do. >> Yup. >> Chad: Still do. >> Valid questions, you know, it's the obvious place for analysts, snarky analysts to go. But in retrospect ... >> Chad: Is there such a thing as a non-snarky analyst? >> There're a couple, there're a couple out there. >> They're sitting here, right here. (Chad laughs) >> It is, getting paid ... >> After the comments that I've already gotten! >> It's getting paid to be snarky. >> That's what's fantastic, by the way. That's what's like watching Charlie Rose and Bill Clinton. Hard but smooth. >> So, if I go back into history, though ... I wish Michael were here, and I'll ask Michael, I know you watch, I'll you next time I see you. I wonder if he had to do it all over again, if he knew then what he knew now, if he would've just said, "You know what? "I'm going to do better just staying with the EMC partnership, "instead of going out and buying Equallogic or Compellent, "and we would've done better for customers, "might've made more money." I wonder if you've learned anything from that experience. I mean, you were biased, 'cause you were on the EMC side of that, obviously you didn't want to see Dell end that relationship, but are there similarities here? >> You know, I think that there's similarities, but there's a notable difference. When the Dell/EMC merger occurred, and the first time I came out to visit headquarters, I mean, lots of discussions with Sudheesh and with Dheeraj. There's a core thing here that's important to understand. The market is not in a zero-sum game. So if, if there's 6,200 Nutanix customers, 2,500 XC customers, roughly 3,000 VX Real customers, roughly 8,000 VSAN customers, you know how many VNX customers there are? 300,000. Do you know how many power-edge servers there are out there? 27 million. We're on the earliest days of the software-defined and HCI journey, and frankly, that's just the first step towards building hybrid clouds on-prem and off-prem that bridge one another, which has been a big part of the announcements from this week. >> Yeah, look, I think the first part of the question you asked, you got to be honest that, you know, when you flip sometimes TV channels, let's say you come across National Geographic, right? And then there's a cheetah chasing a deer. You stop, you want to watch. You know what's going to happen, the cheetah's going to eat the deer, one way or other, that's going to happen. You know it, but you want to watch it. The way we think of our industry, status quo is the cheetah. The deer is all of us, the moment you stop innovating. That is particularly true for companies like ours, young companies. The partnership that we have is not built on anything but the fact that we are adding more value for customers than what we would individually do. That's it. The sum of the parts of this should be higher than the individual parts, right? So what we have learned, for example, last quarter, you're absolutely right, financial analysts, they'll always ask us about the Dell EMC overhang. Last quarter, for example, we for the first time publicly talked about the fact that Dell EMC business was around eight to nine percent of our overall revenue. And it is not because that didn't grow. It is growing, but the overall business we are able to keep growing. Our destiny's in our hands, and it comes down to couple of things6: our ability to really accelerate innovation, because as a younger company, more agile, we are expected to do more, and you saw this morning. Number two, make sure that we are playing fair. There are rules of engagement that we are, because we know that they have tremendous amount of portfolio, and some of them will overlap, and that's okay. But you have to clearly define the rules of engagements, and be very fair in how we treat the partner. And if you do those two things right, we know that this is a relationship that'll last long time. >> And just a quick little add, I mean, the things that we bring is extending the platform's scale and reach. There's no question that you're a younger company, there's no question that we're a larger company. The number of customers that say, "We want the better together thing," and we give them that choice, it's very important for us to do that, but also add value. So whether it's integrating data protection, whether it's what we've done around running Cloud Foundry on top of XC. Home Depot talked about it. >> Classic example, yeah. >> It's a great example, where they want this, that, all together. Now I can't emphasize enough that what we've been trying to emphasize is be transparent, be consistent about those rules of engagement, and telling our customers, you know, driving that choice and giving them that benefit is something that we have to sustain. >> And it's also important to understand that you know, if you spent this morning watching the keynote, you clearly saw that we did not talk about hyperconverged. What we talked about were two things. One is pushing that cloud intelligence to the edge, and then building a hyper-cloud experience that is totally transparent. And the second thing was about building a multi-cloud environment through Calm. We did not talk about hyperconverged. Those things are not built on a platform that is not built for ... Those things are built on a platform that is ready for web-scale architecture. So the foundation that we have built in the last seven years is on which we are building, and as long as we continue to add value like that, and partner, for example, on PCF, you know, Pivotal Cloud Foundry, that's a classic example, a Home Depot example, right? They need that same experience that they're getting from Edibus. And Edibus is not just doing IAAS. They're doing PAAS, they're doing the entire thing. To do that, there is no shame in figuring out what we do well, what we don't do well, understand their strengths and weakness, come together, and deliver something that is better for customers. >> Sudheesh, I'm curious, actually, 'cause Home Depot is a, you know, lighthouse account for Pivotal, on Google Cloud platform. Talking to them about it for the last six months. How does that fit in? We know that the Dell family is a multi-function, so I'm curious to want to hear the Nutanix piece of how that fits in. >> Look, I think the Google thing is a relatively new thing for us. We are expecting two different areas that we are going to partner with them. >> No, no, but Home Depot specifically, is that related? >> No. >> Because they're a big GCP customer, so maybe Chad needs to fill it in. >> This specific project is all on Exceed with PCS. >> The thing that I think is fascinating, and to watchers, I would say, for the intellectually curious that are willing to double-click and go a little bit further, it's a little more of a complex, nuanced story, but everyone's looking for a soundbite, whether it's in politics, as we're here in DC, or whether it's in news, or whatever. Home Depot, like a ton of customers, is using GCP. They're using XC, they're using vSphere, they're using NSX, they're using PCF. It's not like there's some singular thing. Another fascinating example is, I talked to a customer who's a fantastic ScaleIO, VxRack FLEX customer, vSphere, enormous scale and scope, and when I asked them, they want a hybrid cloud to this point. HCI is just a foundation for hybrid cloud use. When I asked them, like, what are their hybrid cloud targets, they're like, "AWS, but we use GCP because we depend on TensorFlow." It is, we live in a world which you need to expand your mind and not naturally create this, like, binary A/B thing. >> Stu: It's a multi-cloud world, Chad. >> It's a multi-stacked, multi-cloud, multi-use case world. >> An inter-genius mess in IT that we've been dealing with. >> So another thing that analysts do a lot is give unsolicited advice. (Chad laughs) So I want to do that and maybe get your reaction. So, Amazon's operating profits are roughly almost double what EMC's were, Amazon Web Services, when EMC was a public company. Massive change and disruptive force in our industry. And frankly, if it weren't for AWS, we wouldn't be where we are today as fast as we were, so I see your joint challenge as fulfilling the vision of what we call true private cloud. Substantially mimicking the cloud experience on-prem. And you're behind, and you know you're behind at that, because Amazon's by definition in the lead. So your challenge as we see it is to create that experience and create that automation and allow people to shift their labor costs to the fun stuff. >> By the way, I agree, and I accept that advice. You can answer for you, but I'll tell you, we've been trying to ... So we started with the first enterprise hybrid cloud efforts almost three and a half years ago, and they're enormous, and at the time we said, "And deploy it on anything you want." And you know what? We had very limited success with that. And the reason we had limited success wasn't because we didn't get the customer going, "Yes, I want to have a hybrid cloud, "where I can bridge and connect to "multiple different public cloud targets." That idea, dead right. The idea of you can build it any way you want? Wrong. Then we said, "Okay, you know what? "CI is a simplification." What we realized is that life cycling CI stacks along with a CMP layer, whether it's inside an integrated thing, or whether it's directly adjacent, still too complex. The latest is basically all of our hybrid cloud, whether it's destined towards enterprise IAAS or PAAS on prem, runs on HCI. When? Always. Because HCI is fundamentally orders of magnitude easier to symph, to deploy, to scale, to version, etc., etc. What I've been seeing over the last 24 hours about basically the Calm acquisition becoming part of Acropolis, is the example where Nutanix is taking it, where they're trying to build it into the Calm and Acropolis stack. I think that's a common vision between the two companies. >> What you will hear from HP or Cisco or EMC or Nutanix, the picture isn't going to change much, because we all know what the blueprint looks like. I think the real question is, how do you get there? How you do that is where the difference is going to be, and the advantage we have is that because we built every stack with that clean architecture in mind, the North Star being, we have to deliver a fully-automatable stack, we have an added advantage of building every step connect naturally to the next step. So for example, our metadata structure, our storage fabric, our virtualization fabric, AHV, our automation fabric on Calm, and how we are introducing Xi, that's a hybrid cloud service, it is all controlled from Prism. And that Prism itself and Prism Central are fully distributed. So that ability to deploy this at scale across multiple continents and manage it, that is very similar to how Amazon ... The reason why Amazon can deliver millisecond billing on Lambda stack is not because they are taking ten different products. They have technology that is built to deliver that level of granularity. >> So again, I agree, but there's an element that I disagree. Calm was an acquisition. Calm was an acquisition of people and talent to basically extend up into the IAAS, chargeback, billing, self-service portal domain. No disrespect of the decision, technology, architecture. You've done, obviously, great progress that you've shown to the market the last two days about how you're integrating that into your stack. We've been at this now for four years, and we've looked at, how do we need to keep evolving our own Dell Technologies stacks? Again, it's not an either/or. So for example, we do multi-site PCF deployments directly on top of a HCI target that has total life cycle, completely distributed stack, and the Pivotal/Google work around Kubernetes coming as part of Pivotal, which echoes a lot of the Kubernetes becoming part of your stack as well. Kubo highlights what we're all trying to do towards that target. Again, I think that the natural tendency because people like to see car races to watch for crashes, cheetahs chasing lions ... >> Or something like that. >> I think we're all striving to do what you said. The customer demand for simple-to-operate, simple-to-deploy, simple-to-scale, turnkey IAAS, PAAS, and even SAAS stacks that're a hybrid deployment model, that is a fact. How customers need to evaluate all the choices in the marketplace is again, who does it best? >> And if you don't, you're the deer, is your point. >> Chad: You're the lion or the deer. >> I wish we had more time, guys. I'll give you both the last word. Chad, you're everywhere this week, and everywhere every week, but final thoughts. >> Final thoughts, I mean, customers can know that we're committed to customer choice, we're committed to this partnership. The number of customers in revenue continues to grow. Our point of view is that we've got a portfolio approach, but no one should be confused about what that means. That means that we're committed to the partnership. Customers, I've talked to a lot of them here, they're happy. Never punch your customer in the face, and never punch yourself in the face. Simple strategy from Chad Sakac. >> Sudheesh, put a capstone on it. >> My point's very simple. I think this is a partnership that is working. The company's run by really smart people. I don't think we are interested in doing anything that is going to make our customers' decision a wrong one for them. And we are committed, we are committed to innovate, and are committed a service to join customers together. Thank you. >> Guys, you know, you guys make this job fun. Thank you so much for coming on the Cube. Really appreciate it. >> It's our pleasure, guys. Remember, Happy Canada Day! >> All right, July 1st. Love it. All right, keep it right there, everybody. We'll be back with our next guest right after this short break. (electronic music)

(upbeat music) >> Narrator: Live from Washington D.C. It's the Cube. Covering .NEXT Conference. Brought to you by Nutanix. >> Welcome back to .NEXT in D.C. everybody. My name is Dave Vellante and I'm with my co-host Stewart Miniman. This is the Cube, the leader in live tech coverage. We go out to the events and extract a signal from the know as we hear it. .NEXT, Nutanix's customer event. Two days of wall to wall coverage. Julia Palmer is here. She's a research director at Gartner. My new best friend. (laughs) Great to see you again. We had a great dinner last night. I really enjoyed the conversation. Thanks for coming on the Cube. >> Oh, my pleasure. >> So, it's a good little event here. Lot of excitement. But what's your take? You are a former practitioner, now an analyist. You were in the heart of technology at GoDaddy. You really know the market, the products. What do you make of what's going on here at .NEXT? >> You know when hyper convergence first emerged it was all about saving money. It was all about going from infrastructure that was maybe too complex and too expensive to something that maybe, based on commodity will bring lower acquisition costs. But this not the story today at all. That's what, I think my IT leaders are telling me. They're not going after acquisition costs. They're not looking at things and just comparing by the capex. They're looking at the bigger picture and how will this technology will help them to enable business. So that's I think a the biggest difference now. Going from something as simple as, is it going to to be more expensive? Less expensive? To how will it move the needle to my enterprise, to my organization? >> Dave: So that's certainly the messaging that you're hearing from, from Nutanix. As a practitioner, do you buy that? Do you believe that they're more than just an infrastructure company? That they are a transformative force in the industry. >> Julia: Yeah, I hear a lot, you know. I moderated a panel today with three customers and one of them said, you know, I'm in the health care business. I'm here to save lives. I'm not here to reinvent my own hyper converge infrastructures. So, he wants to focus on what's important for his end users. And he wants to stop manage (mumbles). That's just not a focus. And I hear it over and over again from different types of customers. >> Dave: Hmm, now you were not a Nutanix customer previously, correct? >> No. But you did see a lot of different infrastructure products? >> Julia: Absolutely. >> As a practitioner what bothered you about what the vendor community did. What were your likes and dislikes? >> Julia: Everything. Everything bothered me. >> Everything bothered you. I was part of pretty large organization and when you have a big footprint you have big problems. And one of them, for example, was that we would have an outage and we reach out to the vendor and they would tell us, you know, you hit a bug and we have a fix and we will give you the fix and you will be good to go tomorrow. Nevermind the outage that you had and impacted end users. So now a lot of vendors are using predictive analytics. Cloud based analytics, >> Right. to see if there's anything in your existing environment that's susceptible to existing bugs and proactively reach out to you to provide a fix. So I was just thinking, looking back, how many outages I could have prevented if this technology was available when I was running it. >> Stewart: Yeah, Julia, I mean we know that companies for so long, you know, infrastructure, they spent so much of their time, you know, running around, patching it, fixing it, worrying about that. Hyper converge now is trying to talk about, you know, where it fits into the whole cloud picture, which is mostly about an operational model. Where do you see along those trends. Do you believe that hyper converge really fits into a cloud strategy or is it cloud washing from a bunch of infrastructure people? You know? >> I think it has a potential. I don't think it's there today. But I think it has a great potential because when I talked to Gartner end users about, like, why hyper converge? And I actually did some total cost of ownership research, what they all told me that looking back they realized how much OpEx it saved them. And they say it was very difficult. You kind of had to take our chance on it because upfront you can't predict the outcome. Is it really going to be more simple? What does simple mean? What's key performance indicator and simple you can put. So, but looking back, the guys that implemented, they all told me that 60 percent of OpEx they saved. Meaning they didn't last with infrastructure (mumbles). How do they do this? They stop manage components. They start managing VM's. So next step is stop manage VM's, start managing applications and that's what cloud management is all about. Getting out of infrastructure management all together and deliver a business what they want. And usually, they want support for their applications. >> Dave: So, my understanding is that Gartner has analysts that service the vendor community, the executive community, and the practitioner community. You are a direct practitioner, >> Yes. Advisor. >> I deal with IT leaders. Okay, your peeps. (laughs) I think you mentioned to me last night that you've had hundreds of conversations and you've only been at Gartner, what, six months? >> Two years. >> Oh, two years, sorry. I apologize for that. Okay, so in the two years, hundreds of conversations. Is that fair? What kinds of conversations are you having with clients around infrastructure? What are the challenges that they're having? And what are you advising them? I know there are many, many, but maybe you can summarize the top ones. >> That's a very good question. I actually want to write research about it. Top five questions about hyper converse people asking so I've been thinking about it for a while. So, different types of customers, new customers are asking questions about, is it ready? Should I go for it? Why would I go for it? Why can't I keep my (mumbles) infrastructure design? What should I look for as a new key performance indicators? It's not the same way, how would you judge it here. Then existing hyper converge customer are looking for what's next step in hyper convergence. Is it ready for prime time? Is it ready for mission critical applications? Because they're looking at the boxes and they look at the commodity hardware and they still feel uncertain. Can it really run something that they're a proprietary hardware used to run. So we explore the advantages of software defined, software defined storage. Value is in the software. You know, being backed up by software defined storage, my favorite subject, is a, is a, you know abstracting and distributing data that you don't worry about us anymore. So scale out storage replacing proprietary architecture can provide you same level of uptime and performance especially with new, you know, flash options. So that's a popular question. Number three is just the, you know, we leave it to in the age of a compressed differentiation I believe my colleague Dave Russell calls it, and there's a small differences between the vendors and end users are not aware of this. And they can be critical for particular use case. So they always ask strengths, weaknesses, opportunities, threats on each and every one them. Because we have a lot of solutions on hyper converge now. A lot of vendors, prominent vendors now join the market. So end users are a little bit confused. How do I navigate through this ocean of different hyper converge solutions. >> Stewart: Yeah, so Julia, Nutanix helped really drive a lot of this awareness for the hyper converge market. Now, every company, you know, all the big players have at least one, if not multiple solutions out there. How do you see Nutanix? Are they differentiating themselves? Are they, I know they're trying move beyond kind of the hyper converge label, ya know. What are the doing good? What would you like to see them do more? >> Julia: Yeah, Nutanix is a, you know, was one of the leaders from the very beginning. And, you know, remains the leader. They obviously succeed in at least in a lot a features. And a very fast release cycle of new features. It's easy when you have one focus, you know. Other companies have so many different areas they need to focus or protect and Nutanix doesn't have this problem. And also being able to mix different hardware, I think it's an advantage, you know. Being able, the customer needs to make a choice, you know. I think the structure of the future is going to be all about choice. It's less about, ya know, this is a lock in. I want to pick my hyper visor. I want to pick my hardware and move on. >> Stewart: So one of the things I think Nutanix does best when they're not positioning themselves as a storage solution, however, cause the storage market is tremendously competitive and there's always the, you know, there's the next technology, the next wave. There's so many competitors out there. I mean, do you think things like NVMe over Fabric are going to just, you know, have the potential to disrupt everything that Nutanix is doing? You know, what are some of the big threats to, ya know, their current position? >> Actually, I just wrote a research about how NVMe and NVMe over Fabrics is going to disrupt and improve integrated and hyper converge systems. I think those technologies and it's like NVMe without NVMe over Fabric. It's like, I call it, it's like barbecue without barbecue sauce, right? So the NVMe and NVMe over Fabric has potential to boost performance of hyper converge systems on par with what a solid state, erase today do. So I think a, and it's commodity hardware, right? We're not talking about anything proprietary. So when a we going to move towards this territory when NVMe and NVME over Fabrics become mainstream maybe two years from now, three maybe years from now. I think everybody can enjoy shared distributed storage performance. And, but honestly, your question about storage, like do you need to position yourself as a storage company or not, the major difference about different hyper converge products, in my opinion, is how they do storage. Other than this, it's the same flavors of hyper visor, it's the same commodity hardware. So what do we have different? The ways you did data services. The ways you position your storage. You, you deliver the storage services. >> Stewart: So, you know what, I'm curious. When I read Wall Street stuff about Nutanix they seem to overreact to every bit of news so, you know, the Dell relationship, ya know, is challenging there for that to head win. Oh wait, the Google announcement seems to be a great tailwind, ya know, the big bump in the stock today. Do you see those partnerships as critically important or is it the vision and execution of Nutanix and what they're doing with their customers? >> I think so. I think we live in the age when a ecosystem support is everything, ya know. People not necessarily today go to the public cloud to save money. They go for ecosystem support. To expand their services and their capabilities. That's why, ya know, embracing the cloud and not trying to position yourself against is the right way to go. I think we all need to embrace cloud and find the way that will benefit the end users. >> Dave: Um hmm, so you were sharing with, you spend a fair amount of time, all Gartner analysts who do these things do on magic quadrants. They, we put a lot of effort into them. A lot of people criticize magic quadrants. I think they're unfairly criticized. I know how much work goes into them. >> Thank you. And they are fact based opinions if I could categorize them like that, right? Is that fair? So, do you do one on hyper converged infrastructure or converged? Do you separate converged from hyper converged? How do you look at the market? >> Julia: So last year magic quadrant was integrated systems, which is converged and hyper converged. But what Gartner does is actually, every year we look at the market and we adjust our inclusion criteria. We adjust market definition. So, I don't think it's a big secret that hyper conversion is leading this market right now. And, honestly, in conversion infrastructure, if you look at conversion infrastructure, it's very similar. The only difference in conversion infrastructure is how you do storage. Which storage area you are using. So it becomes less strategic to even analyze conversion infrastructure. So you will see this year, I cannot break all of the news here, but much more emphasis on software driven, hyper converged infrastructure. Not services. Not the appliances, but more software. >> Stewart: I love to hear that cause at Wikimon when we called the category "server sand" so like VM ware, major player both as a partner in Nutanix. A competitor in Nutanix. Ya know, I know there like, they don't show up on the Gartner magic quadrant because they don't fit into that environment. Also the lines between converge, hyper converge, and software defined storage seem to be blurring a lot. I mean, in some ways they're just different ways of packaging. Some of the others, they, hyper converged is a, ya know, delivery option for what they're doing, so. >> Julia: Exactly. >> Where do you see it going, ya know, it's, ya know, obviously beyond the appliance but, ya know. Say there's the Google announcement today. Where do you see, ya know, a company like Nutanix fitting into this hybrid or multi-cloud world? >> Differentiating on software, this is the name of the game, right? So, if you can have a portable software you can run on any hardware, you obviously can continue and run on any cloud as well. And this is an idea. You said it absolutely right. Like software defines storage. It's not a technology. It's a delivery option. So customer needs to be in charge of their options. Do I want to deploy on premises? Do I want to go on cloud? Do I want to have an appliance? Do I want to buy a software, bring your own hardware? All of those choices need to be given to the end user. They need to decide which way they want to go. >> Dave: So, we're going to have Chad Saccage on tomorrow and it's obviously interesting, we see Nutanix selling through Dell. We were there two years ago when that announcement was made. Great, ya know, business. Terrific. But as you were saying, converged and hyper converged and software defined, they're all coming together now. What do you expect is going to happen with EMC and Nutanix? Do you have any... I don't want to use the prediction, but any scenarios that you can see developing there? >> I think, you know I hate to speculate, but I think both of those companies are extremely user oriented. So, if there will be demand for Nutanix that will continue to support Nutanix because they will do it right by the customers. And same with Nutanix, ya know, they never want to turn someone down saying it's not their problem. Both support them in parallel as long as demand is there. >> Dave: So let me ask the question differently, cause I agree with you. EMC, customer centric. Michael Dell, there's nobody more customer centric on the planet. Clearly Nutanix is customer focused. Having said that, if the three of us were advising Dell, EMC on what to do, we would say keep doing what the customers want. Great, check. But from a product roadmap standpoint, I don't know about you Stew, but I know I would push them to look at doing more of a hyper converge, software defined, like roadmap, as opposed to kind of bolted on V-blocks. Which got it all started. Would you agree with that? Or, do you think that's a waste of R&D? Just outsource it or OEM it? >> Software defined storage is hard to do. It's hard to do it from the ground up, ya know. Products need to mature, ya know, VMware, VSEN. It's a mature product. It's a good foundation for software defined storage and for hyper converged. Building something from the ground up, just to separated from VMware, it will be very difficult. >> Dave: Okay, well okay, right. Well then double down on VMware maybe is the advice there. Or maybe they're not really inquisitive right now because they have the debt service but over time maybe bring in startups to innovate there. Or maybe not because when you look at the Dell EMC deal from previous generations, there's a very successful deal. One of the most, probably the most successful storage deal in the history >> Stewart: Talking about the partnership? >> of storage. The partnership. >> Sure. Before Dell bought Compellent, then remember, Dell buys Compellent. I would look back on that and say Dell probably would have been better off just staying with EMC. Reselling EMC. I mean you were there during those days. I don't know. Was Compellent and EqualLogic, >> EqualLogic were those successful acquisitions in your view? In retrospect. >> Stewart: In retrospect they did pretty well but you're right Dave, the EMC partnership was way more money. I think by the time Dell bought EMC the internal Dell storage, ya know, revenue had grown to almost, or a, ya know, order of magnitude, the same size of EMC and they had to put a lot more emphasis into it. So, you know, better margins, ya know, just if they continue to partner. >> Dave: So maybe it's better for Dell to continue to partner is kind of your point. >> Stewart: Yeah. >> Julia: Absolutely. >> Uh huh, okay. Very diplomatic. (laughs) >> Julia: Would you expect anything else? (laughs) >> Julia, thanks so much for coming on the Cube >> Oh, thank you guys it was a pleasure having you. >> it was my pleasure >> Julia: Thank you for having me. >> You're welcome. Alright, keep it right there everybody. We'll be back to wrap right after this short break. This is the Cube. We're live from D.C. at Nutanix .NEXT. Be right back. (electronic music) >> Narrator: Robert Hershev.