>>From the cube studios in Palo Alto, in Boston, bringing you data driven insights from the cube and ETR. This is breaking analysis with Dave ante. >>When Frank sluman took service, now public many people undervalued the company, positioning it as just a better help desk tool. You know, it turns out that the firm actually had a massive Tam expansion opportunity in it. SM customer service, HR, logistics, security marketing, and service management. Generally now stock price followed over the years, the stellar execution under Slootman and CFO, Mike scar Kelly's leadership. Now, when they took the reins at snowflake expectations were already set that they'd repeat the feet, but this time, if anything, the company was overvalued out of the gate, the thing is people didn't really better understand the market opportunity this time around, other than that, it was a bet on Salman's track record of execution and on data, pretty good bets, but folks really didn't appreciate that snowflake. Wasn't just a better data warehouse that it was building what they call a data cloud, and we've turned a data super cloud. >>Hello and welcome to this. Week's Wikibon cube insights powered by ETR in this breaking analysis, we'll do four things. First. We're gonna review the recent narrative and concerns about snowflake and its value. Second, we're gonna share survey data from ETR that will confirm precisely what the company's CFO has been telling anyone who will listen. And third, we're gonna share our view of what snowflake is building IE, trying to become the defacto standard data platform, and four convey our expectations for the upcoming snowflake summit. Next week at Caesar's palace in Las Vegas, Snowflake's most recent quarterly results they've been well covered and well documented. It basically hit its targets, which for snowflake investors was bad news wall street piled on expressing concerns about Snowflake's consumption, pricing model, slowing growth rates, lack of profitability and valuation. Given the, given the current macro market conditions, the stock dropped below its IPO offering price, which you couldn't touch on day one, by the way, as the stock opened well above that and, and certainly closed well above that price of one 20 and folks express concerns about some pretty massive insider selling throughout 2021 and early 2022, all this caused the stock price to drop quite substantially. >>And today it's down around 63% or more year to date, but the only real substantive change in the company's business is that some of its largest consumer facing companies, while still growing dialed back, their consumption this past quarter, the tone of the call was I wouldn't say contentious the earnings call, but Scarelli, I think was getting somewhat annoyed with the implication from some analyst questions that something is fundamentally wrong with Snowflake's business. So let's unpack this a bit first. I wanna talk about the consumption pricing on the earnings call. One of the analysts asked if snowflake would consider more of a subscription based model so that they could better weather such fluctuations and demand before the analyst could even finish the question, CFO Scarelli emphatically interrupted and said, no, <laugh> the analyst might as well have asked, Hey Mike, have you ever considered changing your pricing model and screwing your customers the same way most legacy SaaS companies lock their customers in? >>So you could squeeze more revenue out of them and make my forecasting life a little bit easier. <laugh> consumption pricing is one of the things that makes a company like snowflake so attractive because customers is especially large customers facing fluctuating demand can dial and their end demand can dial down usage for certain workloads that are maybe not yet revenue producing or critical. Now let's jump to insider trading. There were a lot of insider selling going on last year and into 2022 now, I mean a lot sloop and Scarelli Christine Kleinman. Mike SP several board members. They sold stock worth, you know, many, many hundreds of millions of dollars or, or more at prices in the two hundreds and three hundreds and even four hundreds. You remember the company at one point was valued at a hundred billion dollars, surpassing the value of service now, which is this stupid at this point in the company's tenure and the insider's cost basis was very often in the single digit. >>So on the one hand, I can't blame them. You know what a gift the market gave them last year. Now also famed investor, Peter Linsey famously said, insiders sell for many reasons, but they only buy for one. But I have to say there wasn't a lot of insider buying of the stock when it was in the three hundreds and above. And so yeah, this pattern is something to watch our insiders buying. Now, I'm not sure we'll keep watching snowflake. It's pretty generous with stock based compensation and insiders still own plenty of stock. So, you know, maybe not, but we'll see in future disclosures, but the bottom line is Snowflake's business. Hasn't dramatically changed with the exception of these large consumer facing companies. Now, another analyst pointed out that companies like snap, he pointed to company snap, Peloton, Netflix, and face Facebook have been cutting back. >>And Scarelli said, and what was a bit of a surprise to me? Well, I'm not gonna name the customers, but it's not the ones you mentioned. So I, I thought I would've, you know, if I were the analyst I would've follow up with, how about Walmart target visa, Amex, Expedia price line, or Uber? Any of those Mike? I, I doubt he would've answered me anything. Anyway, the one thing that Scarelli did do is update Snowflake's fiscal year 2029 outlook to emphasize the long term opportunity that the company sees. This chart shows a financial snapshot of Snowflake's current business using a combination of quarterly and full year numbers in a model of what the business will look like. According to Scarelli in Dave ante with a little bit of judgment in 2029. So this is essentially based on the company's framework. Snowflake this year will surpass 2 billion in revenues and targeting 10 billion by 2029. >>Its current growth rate is 84% and its target is 30% in the out years, which is pretty impressive. Gross margins are gonna tick up a bit, but remember Snowflake's cost a good sold they're dominated by its cloud cost. So it's got a governor. There has to pay AWS Azure and Google for its infrastructure. But high seventies is a, is a good target. It's not like the historical Microsoft, you know, 80, 90% gross margin. Not that Microsoft is there anymore, but, but snowflake, you know, was gonna be limited by how far it can, how much it can push gross margin because of that factor. It's got a tiny operating margin today and it's targeting 20% in 2029. So that would be 2 billion. And you would certainly expect it's operating leverage in the out years to enable much, much, much lower SGNA than the current 54%. I'm guessing R and D's gonna stay healthy, you know, coming in at 15% or so. >>But the real interesting number to watch is free cash flow, 16% this year for the full fiscal year growing to 25% by 2029. So 2.5 billion in free cash flow in the out years, which I believe is up from previous Scarelli forecast in that 10, you know, out year view 2029 view and expect the net revenue retention, the NRR, it's gonna moderate. It's gonna come down, but it's still gonna be well over a hundred percent. We pegged it at 130% based on some of Mike's guidance. Now today, snowflake and every other stock is well off this morning. The company had a 40 billion value would drop well below that midday, but let's stick with the 40 billion on this, this sad Friday on the stock market, we'll go to 40 billion and who knows what the stock is gonna be valued in 2029? No idea, but let's say between 40 and 200 billion and look, it could get even ugly in the market as interest rates rise. >>And if inflation stays high, you know, until we get a Paul Voker like action, which is gonna be painful from the fed share, you know, let's hope we don't have a repeat of the long drawn out 1970s stagflation, but that is a concern among investors. We're gonna try to keep it positive here and we'll do a little sensitivity analysis of snowflake based on Scarelli and Ante's 2029 projections. What we've done here is we've calculated in this chart. Today's current valuation at about 40 billion and run a CAGR through 2029 with our estimates of valuation at that time. So if it stays at 40 billion valuation, can you imagine snowflake grow into a 10 billion company with no increase in valuation by the end, by by 2029 fiscal 2029, that would be a major bummer and investors would get a, a 0% return at 50 billion, 4% Kager 60 billion, 7%. >>Kegar now 7% market return is historically not bad relative to say the S and P 500, but with that kind of revenue and profitability growth projected by snowflake combined with inflation, that would again be a, a kind of a buzzkill for investors. The picture at 75 billion valuation, isn't much brighter, but it picks up at, at a hundred billion, even with inflation that should outperform the market. And as you get to 200 billion, which would track by the way, revenue growth, you get a 30% plus return, which would be pretty good. Could snowflake beat these projections. Absolutely. Could the market perform at the optimistic end of the spectrum? Sure. It could. It could outperform these levels. Could it not perform at these levels? You bet, but hopefully this gives a little context and framework to what Scarelli was talking about and his framework, not with notwithstanding the market's unpredictability you're you're on your own. >>There. I can't help snowflake looks like it's going to continue either way in amazing run compared to other software companies historically, and whether that's reflected in the stock price. Again, I, I, I can't predict, okay. Let's look at some ETR survey data, which aligns really well with what snowflake is telling the street. This chart shows the breakdown of Snowflake's net score and net score. Remember is ETS proprietary methodology that measures the percent of customers in their survey that are adding the platform new. That's the lime green at 19% existing snowflake customers that are ex spending 6% or more on the platform relative to last year. That's the forest green that's 55%. That's a big number flat spend. That's the gray at 21% decreasing spending. That's the pinkish at 5% and churning that's the red only 1% or, or moving off the platform, tiny, tiny churn, subtract the red from the greens and you get a net score that, that, that nets out to 68%. >>That's an, a very impressive net score by ETR standards. But it's down from the highs of the seventies and mid eighties, where high seventies and mid eighties, where snowflake has been since January of 2019 note that this survey of 1500 or so organizations includes 155 snowflake customers. What was really interesting is when we cut the data by industry sector, two of Snowflake's most important verticals, our finance and healthcare, both of those sectors are holding a net score in the ETR survey at its historic range. 83%. Hasn't really moved off that, you know, 80% plus number really encouraging, but retail consumer showed a dramatic decline. This past survey from 73% in the previous quarter down to 54%, 54% in just three months time. So this data aligns almost perfectly with what CFO Scarelli has been telling the street. So I give a lot of credibility to that narrative. >>Now here's a time series chart for the net score and the provision in the data set, meaning how penetrated snowflake is in the survey. Again, net score measures, spending velocity and a specific platform and provision measures the presence in the data set. You can see the steep downward trend in net score this past quarter. Now for context note, the red dotted line on the vertical axis at 40%, that's a bit of a magic number. Anything above that is best in class in our view, snowflake still a well, well above that line, but the April survey as we reported on May 7th in quite a bit of detail shows a meaningful break in the snowflake trend as shown by ETRS call out on the bottom line. You can see a steady rise in the survey, which is a proxy for Snowflake's overall market penetration. So steadily moving up and up. >>Here's a bit of a different view on that data bringing in some of Snowflake's peers and other data platforms. This XY graph shows net score on the vertical axis and provision on the horizontal with the red dotted line. At 40%, you can see from the ETR callouts again, that snowflake while declining in net score still holds the highest net score in the survey. So of course the highest data platforms while the spending velocity on AWS and Microsoft, uh, data platforms, outperforms that have, uh, sorry, while they're spending velocity on snowflake outperforms, that of AWS and, and Microsoft data platforms, those two are still well above the 40% line with a stronger market presence in the category. That's impressive because of their size. And you can see Google cloud and Mongo DB right around the 40% line. Now we reported on Mongo last week and discussed the commentary on consumption models. >>And we referenced Ray Lenchos what we thought was, was quite thoughtful research, uh, that rewarded Mongo DB for its forecasting transparency and, and accuracy and, and less likelihood of facing consumption headwinds. And, and I'll reiterate what I said last week, that snowflake, while seeing demand fluctuations this past quarter from those large customers is, is not like a data lake where you're just gonna shove data in and figure it out later, no schema on, right. Just throw it into the pond. That's gonna be more discretionary and you can turn that stuff off. More likely. Now you, you bring data into the snowflake data cloud with the intent of driving insights, which leads to actions, which leads to value creation. And as snowflake adds capabilities and expands its platform features and innovations and its ecosystem more and more data products are gonna be developed in the snowflake data cloud and by data products. >>We mean products and services that are conceived by business users. And that can be directly monetized, not just via analytics, but through governed data sharing and direct monetization. Here's a picture of that opportunity as we see it, this is our spin on our snowflake total available market chart that we've published many, many times. The key point here goes back to our opening statements. The snowflake data cloud is evolving well beyond just being a simpler and easier to use and more elastic cloud database snowflake is building what we often refer to as a super cloud. That is an abstraction layer that companies that, that comprises rich features and leverages the underlying primitives and APIs of the cloud providers, but hides all that complexity and adds new value beyond that infrastructure that value is seen in the left example in terms of compressed cycle time, snowflake often uses the example of pharmaceutical companies compressing time to discover a drug by years. >>Great example, there are many others this, and, and then through organic development and ecosystem expansion, snowflake will accelerate feature delivery. Snowflake's data cloud vision is not about vertically integrating all the functionality into its platform. Rather it's about creating a platform and delivering secure governed and facile and powerful analytics and data sharing capabilities to its customers, partners in a broad ecosystem so they can create additional value. On top of that ecosystem is how snowflake fills the gaps in its platform by building the best cloud data platform in the world, in terms of collaboration, security, governance, developer, friendliness, machine intelligence, etcetera, snowflake believes and plans to create a defacto standard. In our view in data platforms, get your data into the data cloud and all these native capabilities will be available to you. Now, is that a walled garden? Some might say it is. It's an interesting question and <laugh>, it's a moving target. >>It's definitely proprietary in the sense that snowflake is building something that is highly differentiatable and is building a moat around it. But the more open snowflake can make its platform. The more open source it uses, the more developer friendly and the great greater likelihood people will gravitate toward snowflake. Now, my new friend Tani, she's the creator of the data mesh concept. She might bristle at this narrative in favor, a more open source version of what snowflake is trying to build, but practically speaking, I think she'd recognize that we're a long ways off from that. And I also think that the benefits of a platform that despite requiring data to be inside of the data cloud can distribute data globally, enable facile governed, and computational data sharing, and to a large degree be a self-service platform for data, product builders. So this is how we see snow, the snowflake data cloud vision evolving question is edge part of that vision on the right hand side. >>Well, again, we think that is going to be a future challenge where the ecosystem is gonna have to come to play to fill those gaps. If snowflake can tap the edge, it'll bring even more clarity as to how it can expand into what we believe is a massive 200 billion Tam. Okay, let's close on next. Week's snowflake summit in Las Vegas. The cube is very excited to be there. I'll be hosting with Lisa Martin and we'll have Frank son as well as Christian Kleinman and several other snowflake experts. Analysts are gonna be there, uh, customers. And we're gonna have a number of ecosystem partners on as well. Here's what we'll be looking for. At least some of the things, evidence that our view of Snowflake's data cloud is actually taking shape and evolving in the way that we showed on the previous chart, where we also wanna figure out where snowflake is with it. >>Streamlet acquisition. Remember streamlet is a data science play and an expansion into data, bricks, territory, data, bricks, and snowflake have been going at it for a while. Streamlet brings an open source Python library and machine learning and kind of developer friendly data science environment. We also expect to hear some discussion, hopefully a lot of discussion about developers. Snowflake has a dedicated developer conference in November. So we expect to hear more about that and how it's gonna be leveraging further leveraging snow park, which it has previously announced, including a public preview of programming for unstructured data and data monetization along the lines of what we suggested earlier that is building data products that have the bells and whistles of native snowflake and can be directly monetized by Snowflake's customers. Snowflake's already announced a new workload this past week in security, and we'll be watching for others. >>And finally, what's happening in the all important ecosystem. One of the things we noted when we covered service now, cause we use service now as, as an example because Frank Lupin and Mike Scarelli and others, you know, DNA were there and they're improving on that service. Now in his post IPO, early adult years had a very slow pace. In our view was often one of our criticism of ecosystem development, you know, ServiceNow. They had some niche SI uh, like cloud Sherpa, and eventually the big guys came in and, and, and began to really lean in. And you had some other innovators kind of circling the mothership, some smaller companies, but generally we see sluman emphasizing the ecosystem growth much, much more than with this previous company. And that is a fundamental requirement in our view of any cloud or modern cloud company now to paraphrase the crazy man, Steve bomber developers, developers, developers, cause he screamed it and ranted and ran around the stage and was sweating <laugh> ecosystem ecosystem ecosystem equals optionality for developers and that's what they want. >>And that's how we see the current and future state of snowflake. Thanks today. If you're in Vegas next week, please stop by and say hello with the cube. Thanks to my colleagues, Stephanie Chan, who sometimes helps research breaking analysis topics. Alex, my is, and OS Myerson is on production. And today Andrew Frick, Sarah hiney, Steven Conti Anderson hill Chuck all and the entire team in Palo Alto, including Christian. Sorry, didn't mean to forget you Christian writer, of course, Kristin Martin and Cheryl Knight, they helped get the word out. And Rob ho is our E IIC over at Silicon angle. Remember, all these episodes are available as podcast, wherever you listen to search breaking analysis podcast, I publish each week on wikibon.com and Silicon angle.com. You can email me directly anytime David dot Valante Silicon angle.com. If you got something interesting, I'll respond. If not, I won't or DM me@deteorcommentonmylinkedinpostsandpleasedocheckoutetr.ai for the best survey data in the enterprise tech business. This is Dave Valante for the insights powered by ETR. Thanks for watching. And we'll see you next week. I hope if not, we'll see you next time on breaking analysis.

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

>>from around the globe. It's the Cube with digital coverage of AWS Public Sector online brought to you by Amazon Web services. Oven Welcome back to the cubes. Virtual coverage of Amazon Web services. Eight. Of his public sector summit online. We couldn't be there in person, but we're doing remote interviews. I'm John Curry. Your host of the Cube got a great segment from Asia Pacific on the other side of the world from California about social impact, transforming, teaching and learning with cloud technology. Got three great guests. You go. Richard is the CEO and co founder of Guys Tech and Jean Te'o, CEO and founder of Solve Education Founders and CEOs of startups is great. This is squad was the AIPAC regional head. Education, health care, not for profit and research. Ray Ws, he head start big program Vincent. Thanks for coming on, Janine. And you go Thank you for joining. >>Thanks for having us, John. >>We're not there in person. We're doing remote interviews. I'm really glad to have this topic because now more than ever, social change is happening. Um, this next generation eyes building software and applications to solve big problems. And it's not like yesterday's problems there. Today's problems and learning and mentoring and starting companies are all happening virtually digitally and also in person. So the world's changing. So, um, I gotta ask you, Vincent, we'll start with you and Amazon. Honestly, big started builder culture. You got two great founders here. CEO is doing some great stuff. Tell us a little bit what's going on. A pack, >>A lot of >>activity. I mean, reinvent and some it's out. There are really popular. Give us an update on what's happening. >>Thank you. Thank you for the question, John. I think it's extremely exciting, especially in today's context, that we are seeing so much activities, especially in the education technology sector. One of the challenges that we saw from our education technology customers is that they are always looking for help and support in many off the innovation that they're trying to develop the second area off observation that we had waas, that they are always alone with very limited resources, and they usually do not know where to look for in terms, off support and in terms off who they can reach out to. From a community standpoint, that is actually how we started and developed this program called A W s. At START. It is a program specifically for education technology companies that are targeting delivering innovative education solutions for the education sector. And we bring specific benefits to these education technology companies when they join the program. Aws ed start. Yeah, three specific areas. First one is that we support them with technical support, which is really, really key trying to help them navigate in the various ranges off A W S services that allows them to develop innovative services. The second area is leaking them and building a community off like minded education technology founders and linking them also to investors and VCs and lastly, off course, in supporting innovation. We support them with a bit off AWS cop credits promotional credits for them so that they can go on experiment and develop innovations for their customers. >>That's great stuff. And I want to get into that program a little further because I think that's a great example of kind of benefits AWS provides actually free credits or no one is gonna turn away free credits. We'll take the free credits all the time all day long, but really it's about the innovation. Um, Jean, I want to get your thoughts. How would solve education? Born? What problems were you solving? What made you start this company and tell us your story? >>Thank you so much for the question. So, actually, my co founder was invited to speak at an African innovation forum a couple of years back on the topic that he was sharing with. How can Africa skip over the industrialization face and go direct to the knowledge economy? Onda, the discussion went towards in orderto have access to the knowledge economy, unique knowledge. And how do you get knowledge Well through education. So that's when everybody in the conference was a bit stuck right on the advice waas. In order to scale first, we need to figure out a way to not well, you know, engaging the government and schools and teachers, but not depend on them for the successful education initiated. So and that's was what pain walk away from the conference. And when we met in in Jakarta, we started talking about that also. So while I'm Singaporean, I worked in many developing countries on the problem that we're trying to solve this. It might be shocking to you, but UNESCO recently published over 600 million Children and you are not learning on. That is a big number globally right on out of all the SDG per se from U N. Education. And perhaps I'm biased because I'm a computer engineer. But I see that education is the only one that can be solved by transforming bites. But since the other stg is like, you know, poverty or hunger, right, actually require big amount of logistic coordination and so on. So we saw a very, um, interesting trend with mobile phones, particularly smartphones, becoming more and more ubiquitous. And with that, we saw a very, uh, interesting. Fortunately for us to disseminate education through about technology. So we in self education elevate people out of poverty, true, providing education and employment opportunities live urging on tech. And we our vision is to enable people to empower themselves. And what we do is that we do an open platform that provides everyone effected education. >>You could How about your company? What problem you're you saw And how did it all get started? Tell us your vision. >>Thanks, John. Well, look, it all started. We have a joke. One of the co founder, Matthew, had a has a child with severe learning disorder and dyslexia, and he made a joke one day about having another one of them that would support those those kids on Duh. I took the joke seriously, So we're starting sitting down and, you know, trying to figure out how we could make this happen. Um, so it turns out that the dyslexia is the most common learning disorder in the world, with an estimated 10 to 20% off the worldwide population with the disorder between context between 750 million, up to 1.5 billion individual. With that learning disorder on DSO, where we where we sort of try and tackle. The problem is that we've identified that there's two key things for Children with dyslexia. The first one is that knowing that it is dislikes. Yeah, many being assessed. And the second is so what? What do we do about it? And so given or expertise in data science and and I, we clearly saw, unfortunately off, sort of building something that could assess individual Children and adults with dyslexia. The big problem with the assessment is that it's very expensive. We've met parents in the U. S. Specifically who paid up to 6000 U. S. Dollars for for diagnosis within educational psychologist. On the other side, we have parents who wait 12 months before having a spot. Eso What we so clearly is that the observable symptom of dyslexia are reading and everyone has a smartphone and you're smart. Smartphone is actually really good to record your voice. Eso We started collecting order recording from Children and adults who have been diagnosed with dyslexia, and we then trying a model to recognize the likelihood of this lecture by analyzing audio recording. So in theory, it's like diagnosed dyslexic, helping other undiagnosed, dyslexic being being diagnosed. So we have now an algorithm that can take about 10 minutes, which require no priors. Training cost $20. Andi, anyone can use it. Thio assess someone's likelihood off dyslexia. >>You know, this is the kind of thing that really changes the game because you also have learning progressions that air nonlinear and different. You've got YouTube. You got videos, you have knowledge bases, you've got community. Vincent mentioned that Johnny and you mentioned, you know making the bits driver and changing technology. So Jeannine and Hugo, please take a minute to explain, Okay? You got the idea. You're kicking the tires. You're putting it together. Now you gotta actually start writing code >>for us. We know education technology is not you. Right? Um, education games about you. But before we even started, we look at what's available, and we quickly realize that the digital divide is very real. Most technology out there first are not designed for really low and devices and also not designed for people who do not have Internet at hope so way. So with just that assessment, we quickly realized we need toe do something about on board, but something that that that problem is one eyes just one part of the whole puzzle. There's two other very important things. One is advocacy. Can we prove that we can teach through mobile devices, And then the second thing is motivation it again. It's also really obvious, but and people might think that, you know, uh, marginalized communities are super motivated to learn. Well, I wouldn't say that they are not motivated, but just like all of us behavioral changes really hard right. I would love to work out every day, but, you know, I don't really get identity do that. So how do we, um, use technology to and, um, you know, to induce that behavioral change so that date, so that we can help support the motivation to learn. So those are the different things that we >>welcome? >>Yeah. And then the motivated community even more impactful because then once the flywheel gets going and it's powerful, Hugo, your reaction to you know, you got the idea you got, You got the vision you're starting to put. Take one step in front of the other. You got a W s. Take us through the progression, understand the startup. >>Yeah, sure. I mean, what Jane said is very likely Thio what we're trying to do. But for us, there's there's free key things that in order for us to be successful and help as much people as we can, that is free things. The first one is reliability. The second one is accessibility, and the other one is affordability. Eso the reliability means that we have been doing a lot of work in the scientific approach as to how we're going to make this work. And so we have. We have a couple of scientific publications on Do we have to collect data and, you know, sort of published this into I conferences and things like that. So make sure that we have scientific evidence behind us that that support us. And so what that means that we had Thio have a large amount of data >>on and >>put this to work right on the other side. The accessibility and affordability means that, Julian said. You know it needs to be on the cloud because if it's on the cloud, it's accessible for anyone with any device with an Internet connection, which is, you know, covering most of the globe, it's it's a good start on DSO the clock. The cloud obviously allow us to deliver the same experience in the same value to clients and and parent and teacher and allied health professionals around the world. Andi. That's why you know, it's it's been amazing to to be able to use the technology on the AI side as well. Obviously there is ah lot of benefit off being able to leverage the computational power off off the cloud to to make better, argue with them and better training. >>We're gonna come back to both of you on the I question. I think that's super important. Benson. I want to come back to you, though, because in Asia Pacific and that side of the world, um, you still have the old guard, the incumbents around education and learning. But there is great penetration with mobile and broadband. You have great trends as a tailwind for Amazon and these kinds of opportunity with Head Start. What trends are you seeing that are now favoring you? Because with co vid, you know the world is almost kind of like been a line in the sand is before covert and after co vid. There's more demand for learning and education and community now than ever before, not just for education, the geopolitical landscape, everything around the younger generation. There's, um, or channels more data, the more engagement. How >>are you >>looking at this? What's your vision of these trends? Can you share your thoughts on how that's impacting learning and teaching? >>So there are three things that I want to quickly touch on number one. I think government are beginning to recognize that they really need to change the way they approach solving social and economic problems. The pandemic has certainly calls into question that if you do not have a digital strategy, you can't You can find a better time, uh, to now develop and not just developed a digital strategy, but actually to put it in place. And so government are shifting very, very quickly into the cloud and adopting digital strategy and use digital strategy to address some of the key problems that they are facing. And they have to solve them in a very short period of time. Right? We will talk about speed, three agility off the cloud. That's why the cloud is so powerful for government to adult. The second thing is that we saw a lot of schools closed down across the world. UNESCO reported what 1.5 billion students out of schools. So how then do you continue teaching and learning when you don't have physical classroom open? And that's where education, technology companies and, you know, heroes like Janine's Company and others there's so many of them around our ableto come forward and offer their services and help schools go online run classrooms online continue to allow teaching and learning, you know, online and and this has really benefited the overall education system. The third thing that is happening is that I think tertiary education and maybe even catch off education model will have to change. And they recognize that, you know, again, it goes back to the digital strategy that they got to have a clear digital strategy. And the education technology companies like, what? Who we have here today, just the great partners that the education system need to look at to help them solve some of these problems and get toe addressing giving a solution very, very quickly. >>Well, I know you're being kind of polite to the old guard, but I'm not that polite. I'll just say it. There's some old technology out there and Jenny and you go, You're young enough not to know what I t means because you're born in the cloud. So that's good for you. I remember what I t is like. In fact, there's a There's a joke here in the United States that with everyone at home, the teachers have turned into the I T department, meaning they're helping the parents and the kids figure out how to go on mute and how toe configure a network adds just translation. If they're routers, don't work real problems. I mean, this was technology. Schools were operating with low tech zooms out there. You've got video conferencing, you've got all kinds of things. But now there's all that support that's involved. And so what's happening is it's highlighting the real problems of the institutional technology. So, Vincent, I'll start with you. Um, this is a big problem. So cloud solves that one. You guys have pretty much helped. I t do things that they don't want to do any more by automation. This >>is an >>opportunity not necessary. There's a problem today, but it's an opportunity tomorrow. You just quickly talk about how you see the cloud helping all this manual training and learning new tools. >>We are all now living in a cloud empowered economy. Whether we like it or not, we are touching and using services. There are powered by the cloud, and a lot of them are powered by the AWS cloud. But we don't know about it. A lot of people just don't know, right Whether you are watching Netflix, um Well, in the old days you're buying tickets and and booking hotels on Expedia or now you're actually playing games on epic entertainment, you know, playing fortnight and all those kind of games you're already using and a consumer off the cloud. And so one of the big ideas that we have is we really want to educate and create awareness off club computing for every single person. If it can be used for innovation and to bring about benefits to society, that is a common knowledge that everyone needs to happen. So the first big idea is want to make sure that everyone actually is educated on club literacy? The second thing is, for those who have not embarked on a clear cloud strategy, this is the time. Don't wait for for another pandemic toe happen because you wanna be ready. You want to be prepared for the unknown, which is what a lot of people are faced with, and you want to get ahead of the curve and so education training yourself, getting some learning done, and that's really very, very important as the next step to prepare yourself toe face the uncertainty and having programs like AWS EC start actually helps toe empower and catalyzed innovation in the education industry that our two founders have actually demonstrated. So back to you Join. >>Congratulations on the head. Start. We'll get into that real quickly. Uh, head start. But let's first get the born in the cloud generation, Janine. And you go, You guys were competing. You gotta get your APS out there. You gotta get your solutions. You're born in the cloud. You have to go compete with the existing solutions. How >>do you >>view that? What's your strategy? What's your mindset? Janine will start with you. >>So for us, way are very aware that we're solving a problem that has never been solved, right? If not, we wouldn't have so many people who are not learning. So So? So this is a very big problem. And being able to liberate on cloud technology means that we're able to just focus on what we do best. Right? How do we make sure that learning is sufficient and learning is, um, effective? And how do we keep people motivated and all those sorts of great things, um, leveraging on game mechanics, social network and incentives. And then while we do that on the outside way, can just put almost out solved everything to AWS cloud technology to help us not worry about that. And you were absolutely right. The pandemic actually woke up a lot of people and hands organizations like myself. We start to get queries from governments on brother, even big NGOs on, you know, because before cove it, we had to really do our best to convince them until our troops are dry and way, appreciate this opportunity and and also we want to help people realized that in order to buy, adopting either blended approach are a adopting technology means that you can do mass customization off learning as well. And that's what could what we could do to really push learning to the next level. So and there are a few other creative things that we've done with governments, for example, with the government off East Java on top of just using the education platform as it is andare education platform, which is education game Donald Civilization. Um, they have added in a module that teaches Cove it because, you know, there's health care system is really under a lot of strain there, right and adding this component in and the most popular um mitigate in that component is this This'll game called hopes or not? And it teaches people to identify what's fake news and what's real news. And that really went very popular and very well in that region off 25 million people. So tech became not only just boring school subjects, but it can be used to teach many different things. And following that project, we are working with the federal government off Indonesia to talk about anti something and even a very difficult topic, like sex education as well. >>Yeah, and the learning is nonlinear, horizontally scalable, its network graft so you can learn share about news. And this is contextual data is not just learning. It's everything is not like, you know, linear learning. It's a whole nother ballgame, Hugo. Um, your competitive strategy. You're out there now. You got the covert world. How are you competing? How is Amazon helping you? >>Absolutely. John, look, this is an interesting one, because the current competitors that we have, uh, educational psychologist, they're not a tech, So I wouldn't say that we're competing against a competitive per se. I would say that we're competing against the old way of doing things. The challenge for us is to, um, empower people to be comfortable. We've having a machine, you know, analyzing your kids or your recording and telling you if it's likely to be dislikes. Yeah, and in this concept, obviously, is very new. You know, we can see this in other industry with, you know, you have the app that stand Ford created to diagnose skin cancer by taking a photo of your skin. It's being done in different industry. Eso The biggest challenge for us is really about the old way of doing things. What's been really interesting for us is that, you know, education is lifelong, you know, you have a big part in school, but when you're an adult, you learn on Did you know we've been doing some very interesting work with the Justice Department where, you know, we look at inmate and you know, often when people go to jail, they have, you know, some literacy difficulty, and so we've been doing some very interesting working in this field. We're also doing some very interesting work with HR and company who want to understand their staff and put management in place so that every single person in the company are empowered to do their job and and and, you know, achieve success. So, you know, we're not competing against attack. And often when we talk to other ethnic company, we come before you know, we don't provide a learning solution. We provide a assessment solution on e assessment solution. So, really, John, what we're competing against is an old way of doing things. >>And that's exactly why clouds so successful. You change the economics, you're actually a net new benefit. And I think the cloud gives you speed and you're only challenges getting the word out because the economics air just game changing. Right, So that's how Amazon does so well, um, by the way, you could take all our recordings from the Cube, interviews all my interviews and let me know how ideo Okay, so, um, got all the got all the voice recordings from my interview. I'm sure the test will come back challenging. So take a look at that e. I wanna come back to you. But I wanna ask the two founders real quick for the folks watching. Okay on Dhere about Amazon. They know the history. They know the startups that started on Amazon that became unicorns that went public. I mean, just a long list of successes born in the cloud You get big pay when you're successful. Love that business model. But for the folks watching that were in the virtual garages, air in their houses, innovating and building out new ideas. What does Ed start mean for them? How does it work? Would you would recommend it on what are some of the learnings that you have from work with Head Start? >>But our relationship X s start is almost not like client supplier relationship. It's almost like business partners. So they not only help us with protect their providing the technology, but on top of that, they have their system architect to work with my tech team. And they have, you know, open technical hours for us to interact. And on top of that, they do many other things, like building a community where, you know, people like me and Google can meet and also other opportunities, like getting out the word out there. Right. As you know, all of their, uh, startups run on a very thin budget. So how do we not pour millions of dollars into getting out without there is another big benefit as well. So, um definitely very much recommend that start. And I think another big thing is this, right? Uh, what we know now that we have covert and we have demand coming from all over the place, including, like, even a lot of interest, Ally from the government off Gambia, you know? So how do we quickly deploy our technology right there? Or how do we deploy our technology from the the people who are demanding our solution in Nigeria? Right. With technology that is almost frameless. >>Yeah. The great enabling technology ecosystem to support you. And they got the region's too. So the region's do help. I love we call them Cube Region because we're on Amazon. We have our cloud, Hugo, um, and start your observations, experience and learnings from working with aws. >>Absolutely. Look, this is a lot to say, so I'll try and making sure for anyone, but but also for us on me personally, also as an individual and as a founder, it's really been a 365 sort of support. So like Johnny mentioned, there's the community where you can connect with existing entrepreneur you can connect with expert in different industry. You can ask technical expert and and have ah, you know office our every week. Like you said Jenny, with your tech team talking to cloud architect just to unlock any problem that you may have on day and you know, on the business side I would add something which for us has been really useful is the fact that when we when we've approached government being able to say that we have the support off AWS and that we work with them to establish data integrity, making sure everything is properly secured and all that sort of thing has been really helpful in terms off, moving forward with discussion with potential plant and and government as well. So there's also the business aspect side of things where when people see you, there's a perceived value that you know, your your entourage is smart people and and people who are capable of doing great things. So that's been also really >>helpful, you know, that's a great point. The APP SEC review process, as you do deals is a lot easier. When here on AWS. Vincent were a little bit over time with a great, great great panel here. Close us out. Share with us. What's next for you guys? You got a great startup ecosystem. You're doing some great work out there and education as well. Healthcare. Um, how's your world going on? Take a minute, Thio. Explain what's going on in your world, >>John, I'm part of the public sector Team Worldwide in AWS. We have very clear mission statements on by the first is you know, we want to bring about destructive innovation and the AWS Cloud is really the platform where so many off our techs, whether it's a text, healthtech golf text, all those who are developing solutions to help our governments and our education institutions or health care institutions to really be better at what they do, we want to bring about those disruptive innovations to the market as fast as possible. It's just an honor on a privilege for us to be working. And why is that important? It's because it's linked to our second mission, which is to really make the world a better place to really deliver. Heck, the kind of work that Hugo and Janina doing. You know, we cannot do it by ourselves. We need specialists and really people with brilliant ideas and think big vision to be able to carry out what they are doing. And so we're just honored and privileged to be part off their work And in delivering this impact to society, >>the expansion of AWS out in your area has been phenomenal growth. I've been saying to Teresa Carlson, Andy Jassy in the folks that aws for many, many years, that when you move fast with innovation, the public sector and the private partnerships come together. You're starting to see that blending. And you've got some great founders here, uh, making a social impact, transforming, teaching and learning. So congratulations, Janine and Hugo. Thank you for sharing your story on the Cube. Thanks for joining. >>Thank you. Thank >>you, John. >>I'm John Furry with the Cube. Virtual were remote. We're not in person this year because of the pandemic. You're watching a divest Public sector online summit. Thank you for watching

>> Announcer: From around the globe, it's theCUBE with digital coverage of AWS Public Sector Online brought to you by Amazon Web Services. >> Welcome back to theCUBE's Virtual coverage of Amazon Web Services, AWS Public Sector Summit Online. We couldn't be there in person, but we're doing remote interviews. I'm John Furrier, your host of the cube. We've got a great segment from Asia Pacific on the other side of the world from California, about social impact, transforming teaching and learning with Cloud technology we've got three great guests. Hugo Richard is the CEO and co-founder of Dystech and Janine Teo CEO and founder of Solve Education founders and CEOs of startups is great Vincent Quah is the APAC Regional Head of Education, Healthcare Not-For-Profit and Research for AWS. (indistinct) big program. Vincent, thanks for coming on Janine and Hugo thank you for joining. >> Thanks for having us, John. >> Thanks John So, we're not there in person. We're doing remote interviews. I'm really glad to have this topic because now more than ever social change is happening. This next generation is building software and applications to solve big problems. And it's not like yesterday's problems, they're today's problems and learning and mentoring and starting companies are all happening virtually, digitally, and also in person. So the world's changing. So I got to ask you, Vincent we'll start with you Amazon, obviously big (indistinct) culture. You got two great founders here and CEOs doing some great stuff. Tell us a little bit what's going on at APAC, a lot of activity. I mean re-invent and the summits out there are really popular. Give us an update on what's happening. >> Thank you, thank you for the question, John. I think it's extremely exciting, especially in today's context, that we are seeing so much activities, especially in the education technology sector. One of the challenges that we saw from our education technology customers is that they're always looking for help and support in many of the innovation that they're trying to develop. The second area of observation that we had was that they are always alone with very limited resources and they usually do not know where to look for in terms of support and in terms of not who they can reach out to from a community standpoint, that is actually how we started and developed this program called AWS EdStart. It is a program specifically for education technology companies that are targeting, delivering innovative education solutions for the education sector. And we bring specific benefits to these education technology companies when they joined the program, AWS EdStart. Yeah, three specific areas, one is that we support them with technical support, which is really, really key trying to help them navigate in the various ranges of AWS services that allows them to develop innovative services. The second area is leaking them and building a community of like-minded education technology founders, and linking them also to investors and VCs. And lastly, of course, in supporting innovation, we support them with a bit of AWS Cloud credits, promotional credits for them so that they can go and experiment and develop innovations for their customers. >> That's great stuff I want to get into that program a little bit further because I think, you know, that's a great example of kind of benefits AWS provides (indistinct) free credits or, no one is going to turn away free credits. We'll take the free credits all the time, all day long, but really it's about the innovation. Janine I want to get your thoughts. How was Solve Education born? What problems were you solving? What made you start this company and tell us your story. >> Thank you so much for the question. So actually my co-founder was invited to speak at an African Innovation Forum couple of years back, and the topic that he was sharing with, how can Africa skip over the industrialization phase and go direct to the knowledge economy and that discussion went towards, in order to have access to the knowledge commonly you need knowledge and how do you get knowledge well through education. So that's when everybody in the Congress was a bit stuck, right? And the advice was in order to scale fast, we need to figure out a way to not while, you know, engaging the government and schools and teachers, but not depend on them for the success of the education initiative. So, and that's was what (indistinct) walk away from the conference. And when we met in Jakarta, we started talking about that also. So while I'm Singaporean, I worked in many developing countries. And the problem that we're trying to solve is it might be shocking to you, but UNESCO recently published over 600 million children and youth are not learning. And that is a big number globally, right? And out of all the SDGs per se, from UN, education, and perhaps I'm biased, because I'm a computer engineer, but I see that education is the only one that can be solved by transforming (indistinct) versus the other SDGs like, you know, poverty or hunger, right? Actually require big amount of logistic coordination and so on. So we saw a very interesting trend with mobile phones, particularly smart phones becoming more and more ubiquitous. And with that, we saw a very interesting opportunity for us to disseminate education through mobile technology. So we in self-education elevate people on a public through providing education and employment opportunities, (indistinct) on tech. And we.. our vision is to enable people to empower themselves. And what we do is that we build an open platform that provides everyone active education. >> Hugo How about your company? What problem are you solving? How did it all get started? Tell us your vision. >> Thanks, John. Well, look, it all started with a joke, one of the co-founder, Matthew, had a, he has a child who has severe learning disorder and dyslexia, and he made a joke one day about having (indistinct) that could support those kids. And I took the joke seriously. So we started sitting down and, you know, trying to figure out how we can make this happen. So it turns out that dyslexia is the most common learning disorder in the world. We have an estimated 10 to 20% of the worldwide population with the disorder, due to in context, that's between 750 million up to 1.5 billion individuals with that learning disorder. And so where we sort of try and tackle the problem is that we've identified that there's two key things for children with dyslexia. The first one is that knowing that it is dyslexia, meaning being assessed. And the second one is, so what, what do we do about it? And so given all expertise in data science and AI, we clearly saw an opportunity of sort of building something that could assess individual children and adults with dyslexia. The big problem with the assessment is that it's very expensive. We've met parents in the U.S. specifically who paid up to 6,000 U.S. Dollars for a diagnosis with an educational psychologist. On the other side, we have parents who wait 12 months before having a spot. So what we saw clearly is that the observable symptom of dyslexia are reading, and everyone has a smartphone and (indistinct) from smartphone is actually really good to record your voice. So we started collecting audio recordings from children and adults who have been diagnosed with dyslexia. And we then try to model and to recognize the likelihood of dyslexia by analyzing audio recording. So in theory, it's like diagnosed dyslexic, helping other undiagnosed dyslexic being diagnosed. So we have now (indistinct) them. That can take about 10 minutes, which requires no prior training costs, 20 U.S. Dollar, and anyone can use it to assess someone's likelihood of dyslexia. >> You know, this is the kind of thing that really changes the game because you also have learning for questions that are nonlinear and different. You've got YouTube, you've got videos, you have knowledge bases, you've got community. Vincent mentioned that Janine, you mentioned, you know, making the bits of driver and changing technology. This is the kind of thing that seems obvious now as look at it, but now you've got to put it into action. So, you know, one of the benefits of Cloud on AWS, we'll give a plug for Vincent's company here is that you can move faster. And that's something that Andy Jassy always talks about and Teresa Carlson, being builders and moving fast, but you got to build it. So Janine and Hugo, please take a minute to explain, okay, you got the idea, you're kicking the tires, you're putting it together. Now you've got to actually start writing code. What happens next? Janine, we'll start with you. >> Well, what happens next? Okay. So for us, we know education technology is not new, right. And education games are not new, but before we even started, we look at what's available and we quickly realized that the digital divide is very real, most technology out there first are not designed for (indistinct) devices, and also not designed for people who do not have internet at home. so with just that assessment, we quickly realized we need to do something about, and that's something that problem is. One is just one part of the whole puzzle. There's two other very important things. One is advocacy. Can we prove that we can teach through mobile devices? And then the second thing is motivation. And again, it's also really obvious, but, and people might think that, you know, marginalized communities are super motivated to learn. Well, I wouldn't say that they are not motivated, but just like all of us behavioral change is really hard, right? I would love to workout everyday, but you know, I don't really do that. So how do we use technology to, you know, to induce that behavioral change so that we can help support their motivation to learn. So those are the different things that we work on, certainly with it. >> Yeah, and then a motivated community, is even more impactful because then once the flywheel gets going, then it's powerful. Hugo your reaction to, you know, you got the idea, you got the vision, you're starting to put, take one step in front of the other. You got AWS, take us through the progression on the startup. >> Yeah, sure. I mean, what Janine said is, very likely to, to what we're trying to do, but for us, there's three key things that in order for us to be successful and help as much people as we can, it is three things. The first one is reliability. The second one is accessibility and the other one is affordability. So the reliability means that we have been doing a lot of work in the scientific approach as to how are we going to make this work And so we've.. We have a couple of scientific publications and we had to collect data and, you know, sort of publish this into AI conferences and things like that. So it makes sure that we have the scientific evidence behind us that support us. And so what that means is that we have to have a large amount of data and then put this to work, right on the other side of the accessibility and affordability means that Janine said, you know, it needs to be on the Cloud because if it's on the Cloud, it's accessible for anyone with any device, with an internet connection, which is, you know, covering most of the globe. So it's a good start. And so, the Cloud obviously allow us to deliver the same experience and the same value to clients and parent and teacher and (indistinct) professional around the world. And that's why, you know, it's been amazing, to be able to use the technology on the AI side as well obviously there is a lot of benefit of being able to leverage the computational power of the Cloud, to make better algorithm and better training. >> (indistinct) to come back to both of you on the AI question. I think that's super important. Vincent I want to come back to you though, because in Asia Pacific and that side of the world, you still have the old guard, the incumbents around education and learning, but there's great penetration with mobile and broadband. You have great trends as a tailwind for Amazon and these kinds of opportunities EdStart, what trends are you seeing that are now favoring you? Because with COVID, you know, the world is almost kind of like been a line in the sand is before COVID and after COVID, there's more demand for learning and education and community now than ever before, not just for education, the geopolitical landscape, everything around the younger generation is more channels, more data, the more engagement, how are you looking at this? What's your vision of these trends? Can you share your thoughts on how that's impacting learning and teaching? >> So there're three things that I want to quickly touch on. Number one, I think governments are beginning to recognize that they really need to change the way they approach solving social and economic problems. The pandemic has certainly calls into question that if you do not have a digital strategy, you can't find a better time to now develop and not just develop a digital strategy, but actually to put it in place. And so government are shifting very, very quickly into the Cloud and adopting digital strategy and use digital strategy to address some of the key problems that they are facing. And they have to solve them in a very short period of time. Right, We will talk about speed, the agility of the Cloud, and that's why the Cloud is so powerful for government to adopt. The second thing is that we saw a lot of schools close down across the world, UNESCO reported, what 1.5 billion students out of schools. So how then do you continue teaching and learning when you don't have physical classroom open and that's where education technology companies and, you know, heroes like Janine's company and others, there are so many of them around are able to come forward and offer their services and help schools go online, run classrooms online, continue to allow teaching and learning, you know, online. And this has really benefited the overall education system. The third thing that is happening is that I think tertiary education and maybe even (indistinct) education model will have to change. And they recognize that, you know, again, it goes back to the digital strategy that they've got to have a clear digital strategy and the education technology companies like what, who we have here today. Just the great partners that the education system need to look at to help them solve some of these problems and get to addressing giving a solution very, very quickly. >> Well, I know you're being kind of polite to the old guard, but I'm not that polite. I'll just be, say it. There's some old technology out there and Janine and Hugo, you're young enough not to know what IT means because you're born in the Cloud. So that's good for you. I remember what I teach. Like in fact, there's a, there's a joke here in the United States so with everyone at home the teachers have turned into the IT department, meaning they're helping the parents and the kids figure out how to go unmute and how to configure a network address translation if their routers don't work, real problems. I mean, this was technology, schools were operating with low tech Zoom's out there. You've got video conferencing, you've got all kinds of things, but now there's all that support that's involved. And so what's happening is it's highlighting the real problems of the institutional technology. So Vincent, I'll start with you. This is a big problem. So Cloud solves that one, you guys have pretty much helped IT do things that they don't want to do anymore by automation. This is an opportunity, not necessarily.. There's a problem today, but it's an opportunity tomorrow. Could you just quickly talk about how you see the Cloud, helping all this manual training and learning new tools. >> Absolutely. So I want to say and put forth a hypothesis and that hypothesis is simply this. We are all now living in a Cloud empowered economy, whether we like it or not, we are touching and using services that are powered by the Cloud. And a lot of them are powered by the AWS Cloud, but we don't know about it. A lot of people just don't know, right? Whether you are watching Netflix, well in the old days, you're buying tickets and booking hotels on Expedia, or now you're actually playing games on Epic Entertainment, you know, playing Fortnite and all those kinds of games you're already using and a consumer of the Cloud. And so one of the big ideas that we have is we really want to educate and create awareness of top computing for every single person. If it can be used for innovation and to bring about benefits to society that is a common knowledge that everyone needs to have. And so the first big idea is, want to make sure that everyone actually is educated on Cloud literacy. The second thing is for those who have not embarked on a clear Cloud strategy, this is the time don't wait for another pandemic to happen because you want to be ready. You want to be prepared for the unknown, which is what a lot of people are faced with. And you want to get ahead of the curve. And so education, training yourself, getting some learning done. And that's really very, very important as a next step to prepare yourself to face the uncertainty and having programs like AWS EdStart actually helps to empower and catalyze innovation in the education industry that our two founders have actually demonstrated. So back to you, John. >> Congratulation on the EdStart, we'll get into that and real quickly, EdStart but let's first get the born in the Cloud generation Janine and Hugo you guys are competing, you got to get your apps out there. You've got to get your solutions. You're born in the Cloud. You have to go compete with the existing solutions. How do you view that? What's your strategy? What's your mindset, Janine, we'll start with you. >> So for us, we are very aware that we are solving a problem that has never been solved, right? If not, we wouldn't have so many people who are not learning. So this is a very big problem. And being able to leverage on Cloud technology means that we are able to just focus on what we do best, right? How do we make sure that learning is sufficient and learning is effective. And how do we get people motivated and all those sort of great things leveraging on game mechanics, social network, and incentives. And then while we do that on the Cloud side, we can just put that almost ourselves, everything to AWS Cloud technology to help us not worry about that. And you were absolutely right. The pandemic actually woke up a lot of people and has organizations like myself. We start to get queries from governments and other, even big NGOs on, you know, because before COVID we had to really do our best to convince them until (indistinct) are dry >> (indistinct) knock on doors and convince people. >> Yes. And now we don't have to do that. It's the other way around. So we are really, you know, we appreciate this opportunity and also we want to help people realize that in order to.. By adopting either a blended approach or adopting technology means that you can do mass customization of learning as well. And that's, what we could do to really push learning to the next level. So, and, there are a few other creative things that we've done with governments, for example, with the government of East Java on top of just using the education platform, as it is an educational platform, which is education (indistinct) on our civilization, they have added in a module that teaches COVID because, you know, their health care system is really under a lot of strain there, right? And adding this component in and the most popular mini game in that component is this game called Hoax Or Not. And it teaches people to identify what's fake news and what's real news. And that really went very popular and very well in that region of 25 million people. So that became not only just boring school subjects, but it can be used to teach many different things. And following that project, we are working with the Federal Government of Indonesia to talk about (indistinct) and even a very difficult topic like sex education as well. >> Yeah. And the learning is nonlinear, it's horizontally scalable, it's network graph. So you can learn, share about news. And this is contextual data. It's not just learning, it's everything. It's not like, you know, linear learning. It's a whole nother ballgame, Hugo, your competitive strategy. You're out there now, you got the COVID world. How are you competing? How's Amazon helping you? >> Absolutely John, look, this is an interesting one because the common competitor that we have are educational psychologist, they're not at tech. So I wouldn't say that we're competing against a competitor per se. I would say that we are competing against some old way of doing things. The challenge for us is to empower people, to be comfortable with having a machine, you know, analyzing your kid's audio recording and telling you if it's likely to be dyslexia. And this concept obviously is very new. You know, we can see this in other industry with AI, you know, you have the app that Stanford created to diagnose skin cancer by taking a photo of your skin. So it's being done in different industry. So the biggest challenge for us is really about the old way of doing things. What's been really interesting for us is that you know, education is lifelong, you know, you have a big pot in school, but when you're an adult you learn and, you know, we've been doing some very interesting work with the Justice Department where, you know, we look at inmate and, and, you know, often when people go to jail, they have, you know, some literacy difficulty. And so we've been doing some very interesting work in this field. We're also doing some very interesting work with HR and company who want to understand their staff and put management in place so that every single person in the company are empowered to do the job and, you know, achieve success. So, you know, we're not competing against Ed Tech. And often when we talk to other Ed Tech company, we come before, you know, we don't provide a learning solution. We provide an assessment solution, an E assessment solution. So really John, what we competing against is an old way of doing things. >> And that's exactly why the Cloud's so successful. You change the economics. You're actually a net new benefit. And I think the Cloud gives you speed. And your only challenge is getting the word out because the economics are just game changing, right? So that's how Amazon does so well, by the way, you can take all our recordings from theCUBE interviews, all my interviews and let me know how I do, okay. So got all the, got all the voice recordings for my interview. I'm sure the test will come back challenging. So take a look at that. >> Absolutely. >> Vincent I want to come back to you, but I want to ask the two founders real quick for the folks watching okay and hear about Amazon. They know the history, they know the startups that started on Amazon that became unicorns that went public. I mean, just a long list of successes born in the Cloud. You get big pay when you're successful, love that business model. But for the folks watching that are in the virtual garages or in their houses innovating and building out new ideas, what does EdStart mean for them? How does it work? Would you would recommend it? And what are some of the learnings that you have from working with EdStart? Janine We'll start with you. >> For me. So I would, for me, I would definitely highly recommend EdStart. And the reason is because EdStart, our relationship with EdStart, is almost not like a client-supplier relationship it's almost like business partners. So they not only help us with providing the technology. But on top of that, they have their system architects to work with my tech team and they have, you know, open technical hours for us to interact. And on top of that, they do many other things like building a community where, you know, people like me and Google can meet. And also other opportunities like getting out there, right? As you know, all of the startups run on a very thin budget. So how do we not pour millions of dollars into getting all that out there is another big benefit as well. So I'll definitely very much recommend EdStart. And I think another big thing is this, right? Now that we have COVID and we have demands coming from all other places including like, even (indistinct) from the Government of Gambia, you know, so how do we quickly deploy our technology right there? Or how do we deploy our technology from the people who are demanding our solution in Nigeria, right? With technology it is almost brainless. >> Yeah. The great enabling technology ecosystem to support you. I think, at the regions too. So the regions do help. I love we call them cube regions because we're on Amazon, we have our Cloud Hugo, EdStart your observations, experience and learnings from working with AWS. >> Absolutely. Look, there's a lot to say, so I'll try and make it short for anyone, but, so for us and me personally, and also as an individual and as a founder, it's really been a 365 sort of support. So like Janine mentioned, there's the community where you can connect with existing entrepreneur. You can connect with experts in different industry. You can ask technical experts and have a, you know, office hour every week. Like you said, Janine with, your tech team talking to a Cloud architect just to unlock any problem that you may have. And, you know, on the business side, I would add something which for us has been really useful is the fact that when we've approached government, being able to say that we have the support of AWS and that we work with them to establish data integrity, making sure everything is properly secured and all that sort of thing has been really helpful in terms of moving forward with discussion with potential client and government as well. So there's also the business aspect side of things, where when people see you, there's a perceived value that, you know, your entourage is smart people and people who are capable of doing great things. So that's been also really helpful. >> You know, that's a great point. The AppSec review process as you do deals is a lot easier when you're on AWS. Vincent we're a little bit over time. What a great panel here. Close us out, share with us what's next for you guys. You've got a great startup ecosystem and doing some great work out there and education as well, healthcare, how's your world going on? Take a minute to explain what's going on in your world. >> John I'm part of the public sector team worldwide in AWS, we have very clear mission statements. And the first is, you know, we want to bring about disruptive innovation. And the AWS Cloud is really the platform where so many of our Ed Techs, whether it's (indistinct) Health Tech, Gulf Tech, all those who are developing solutions to help our governments and our education institutions, our healthcare institutions to really be better at what they do. We want to bring about those disruptive innovations to the market, as fast as possible. It's just an honor and a privilege for us to be working. And why is that important? It's because it's linked to our second mission, which is to really make the world a better place to really deliver.. The kind of work that Hugo and Janine are doing. We cannot do it by ourselves. We need specialists and really people with brilliant ideas and think big vision to be able to carry out what they are doing. And so we're just honored and privileged to be part of their work. And in delivering this impact to society. >> The expansion of AWS out in your area has been phenomenal growth. I've been saying to Teresa Carlson and Andy Jassy and the folks at AWS for many, many years, that when you move fast with innovation, the public sector and the private partnerships come together, you starting to see that blending. And you've got some great founders here making a social impact, transforming teaching and learning. So congratulations, Janine and Hugo. Thank you for sharing your story on theCUBE. Thanks for joining. >> Thank you for having us >> thanks John >> Thank you, John. I'm John Furrier with theCUBE Virtual we're remote. We're not in person this year because of the pandemic you're watching AWS Public Sector Online Summit. Thank you for watching. (soft music)

>> Announcer: Live from Boston, Massachusetts, it's theCube. Covering IFS World Conference 2019. Brought to you by IFS. >> Welcome back to Boston everybody you're watching theCube, the leader in live tech coverage. This is day one of the IFS World Conference. I'm Dave Vallante with my co-host Paul Gillen. Melissa Di Donato is here, she's the CEO of SUSE and Jon Roskill is the CEO of Acumatica. Folks, welcome to theCube. >> Thank you so much. >> So you guys had the power panel today? Talking about digital transformation. I got a question for all of you. What's the difference between a business and a digital business? Melissa, I'll give you first crack. >> Before a regular old business and a digital business? Everyone's digital these days, aren't they? I was interviewing the, one of the leaders in Expedia and I said, "Are you a travel company "or are you a digital company? "Like where do you lead with?" And she said to me, "No no, we're a travel company "but we use digital." So it seems like the more and more we think about what the future means how we service our customers, customers being at the core everyone's a digital business. The way you service, the way you communicate the way you support. So whether you're a business or none you're always got to be a digital business. >> You better be a digital business and so-- >> I'm going to take a slightly different tact on that which is, we talk about digital and analog businesses and analog businesses are ones that are data silos they have a lot of systems, so they think they're digital but they're disconnected. And, you know, part of a transformation is connecting all the systems together and getting them to work like one. >> But I think the confict other common thread is data, right? A digital business maybe puts data at the core and that's how they get competitive advantage but, I want to ask you guys about your respective businesses. So SUSE, obviously you compete with the big whale RedHat, you know, the big news last year IBM $34 billion. How did that or will that in your view affect your business? >> It's already affecting our business. We've seen a big big uptake in interest in SUSE and what we're doing. You know, they say that a big part of the install based customers that RedHat and IBM currently have are unhappy about the decision to be acquired by IBM. Whether they're in conflict because we're a very big heavily channel business, right? So a lot of the channel partners are not quite happy about having one of their closest competitors now be, you know, part of the inner circle if you will. And other customers are just not happy. I mean, RedHat had fast innovation, fast pace and thought leadership and now all of a sudden they're going to be buried inside of a large conglomerate and they're not happy about that. So when we look at what's been happening for us particularly since March, we became an independent company now one of the world's largest independent open source company in the world. Since IBM has been taking over from RedHat. And, you know, big big uptake. Since March we became independent we've been getting a lot of questioning. "Where are we, where are we going, what are we doing?" And, " Hey, you know, I haven't heard about SUSE a while "what are you doing now?" So it's been really good news for us really, really good news. >> I mean, we're huge fans of RedHat. We do a lot of their events and-- >> Melissa: I'm a huge fan myself. >> But I tell you, I mean, we know from first hand IBM has this nasty habit of buying companies tripling the price. Now they say they're going to leave RedHat alone, we'll see. >> Yeah, like they said they'd leave Lotus alone and all the others. >> SPSS, you saw that, Ustream, you know one of our platforms. >> What's your view, how do you think it's going to go? >> I don't think it's about cloud I think it's about services and I think that's the piece that we don't really have great visibility on. Can IBM kind of jam OpenShift into its customers you know, businesses without them even really knowing it and that's the near-term cash flow play that they're trying to, you know, effect. >> Yeah, but it's not working for them, isn't though? Because when you look at the install base 90% of their business it's been Linux open source environment and OpenShift is a tag-along. I don't know if that's a real enabler for the future rather than, you know, an afterthought from the past. >> Well, for $34 billion it better be. >> I want to ask you about the cost of shifting because historically, you know if you were IBM, you were stuck with IBM forever. What is involved in customers moving from RedHat to SUSE presumably you're doing some of those migrations style. >> We are, we are doing them more and more in fact, we're even offering migration services ourself in some applications. It depends on the application layer. >> How simple is that? >> It depends on the application. So, we've got some telco companies is very very complex 24/7, you know, high pays, big fat enterprise applications around billing, for example. They're harder to move. >> A lot of custom code. >> A lot of custom code, really deep, really rich they need, you know, constant operation because it's billing, right? Big, fat transactions, those are a little bit more complex than say, the other applications are. Nonetheless, there is a migration path and in fact, we're one of the only open source companies in the world that provides support for not just SUSE, but actually for RedHat. So, if you're a RedHat, for or a well customer that want to get off an unsupported version of RedHat you can come over to SUSE. We'll not just support your RedHat system but actually come up with a migration plan to get you into a supported version of SUSE. >> If it's a package set of apps and you have to freeze the code it's actually not that bad-- >> It's not that bad, no. >> To migrate. All right, Jon I got to ask you, so help us understand Acumatica and IFS and the relationship you're like sister companies, you both the ERP providers. How do you work together or? >> Yeah, so we're both owned by a private equity firm called EQT. IFS is generally focused on $500 million and above company so more enterprise and we're focused on core mid-market. So say, $20 million to $500 million. And so very complementary in that way. IFS is largely direct selling we're a 100% through channels. IFS is stronger in Europe, we're stronger in North America and so they see these as very complementary assets and rather than to, perhaps what's going on with the IBM, RedHat discussion here. Slam these big things together and screw them up they're trying to actually keep us independent. So they put us in a holding company but we're trying to leverage much of each other's goodness as we can. >> Is there a migration path? I mean, for customers who reach the top end of your market can they smoothly get to IFS? >> Yeah, it's not going to be like a smooth you know, turn a switch and go. But it absolutely is a migration option for customers and we do have a set of customers that are outgrowing us you know, we have a number of customers now over a billion dollars running on Acumatica and you know, for a company, we've got one that we're actually talking to about this right now operating in 41 countries global, they need 24/7 support we're not the right company to be running their ERP system. >> On your panel today guys you were talking about, a lot about digital transformations kind of lessons learned. What are the big mistakes you see companies making and kind of what's your roadmap for success? >> I think doing too much too fast. Everyone talks about the digital innovation digital transformation. It's really a business transformation with digital being the underpinning the push forward that carries the business forward, right? And I think that we make too many mistakes with regards to doing too much, too fast, too soon, that's one. Doing and adopting technology for technology's sake. "Oh, it's ML, it's AI." And everyone loves these big buzz words, right? All the code words for what technology is? So they tend to bring it on but they don't really know the outcome. Really really important at SUSE were absolutely obsessed with our customers and during a digital transformation if you remain absolutely sick of anything about your customer at the core of every decision you make and everything you do. Particularly with regards to digital transformation you want to make sure that business outcome is focused on them. Having a clear roadmap with milestones along the journey is really important and ensuring it's really collaborative. We talked this morning about digital natives you know, we're all young, aren't we? Me in particular, but, you know I think the younger generation of digital natives think a little bit differently perhaps than we were originally thinking when we were their age. You know, I depend on that thinking I depend on that integration of that thought leadership infused into companies to help really reach customers in different ways. Our customers are buying differently our customers have different expectations they have different deliverables they require and they expect to be supported in different way. And those digital natives, that young talent can really aid in that delivery of good thought leadership for our businesses. >> So Jon, we're seeing IT spending at the macro slow down a little bit. You know, a lot of different factors going on it's not a disaster, it's not falling off the cliff but definitely pre-2018 levels and one of the theories is that you had this kind of spray-and-pray kind of like Melissa was say, deal was going too fast trying everything and now we're seeing more of a narrow focus on things that are going to give a return. Do you see that happening out there? >> Yeah, definitely some, I mean people are looking for returns even in what's been a really vibrant economy but, you know, I agree with Melissa's point there's a lot of ready, shoot, aim projects out there and, you know, the biggest thing I see is the ones that aren't, the fail that aren't the ones that aren't led by the leadership. They're sort of given off to some side team often the IT team and said, "Go lead digital transformation of the company." And digital transformation you know, Melissa said this morning it's business transformation. You've got to bring the business part of it to the table and you've got to think about, it's got to be led by the CEO or the entire senior leadership team has to be on board and if not, it's not going to be successful. >> So, pragmatism would say, okay, you get some quick hits get some wins and then you got kind of the, you know, Bezos, Michael Dell mindset go big or go home, so what's your philosophy? Moonshots or, you know, quick hits? >> I always think starting you know, you've got to understand your team's capabilities. So starting is something that you can get a gauge of that you know, particularly if you're new and you're walking into an organization, you know. Melissa, I don't know how long you've been in your role now? >> Melissa: 65 days. >> Right, so there you go. So it's probably a good person to ask what, you know, what you're finding out there but I think, you know, getting a gauge of what your resources are. I mean, one of the things you see around here is there are, you know, dozens of partner firms that are, or can be brought into, you know supplement the resources you have in your own team. So being thoughtful in that is part of the approach. And then having a roadmap for what you're trying to do. Like we talked this morning about a customer that Linda had been talking about. Have been working on for six or seven years, right? And you're saying, for an enterprise a very large enterprise company taking six or seven years to turn the battleship maybe isn't that long. >> Okay, so you got the sister company going on. Do you have a commercial relationship with IFS or you just here as kind of an outside speaker and a thought leader? >> I'm here as an outside speaker thought leader. There is talk that perhaps we can you know, work together in the future we're trying to work that out right now. >> I want to ask you about open source business models. We still see companies sort of struggling to come up with, not profitable but, you know, insanely profitable business models based on open source software. What do you see coming out of all this? Is there a model that you think is going to work in the long term? >> I think the future is open source for sure and this is coming from a person who spent 25 years in proprietary software having worked for the larger piece here in vendors. 100% of my life has been dedicated to proprietary software. So whilst that's true I came at SUSE and the open source environment in a very different way as a customer running my proprietary applications on open source Linux based systems. So I come with a little bit different of a, you know, of an approach I would say. The future's open source for sure the way that we collaborate, the innovation the borderless means of which we deliver you know, leadership within our business is much much different than proprietary software. You would think as well that, you know the wall that we hide behind an open source being able to access software anywhere in a community and be able to provide thought leadership masks and hides who the developers and engineers are and instead exacerbates the thought leadership that comes out of them. So it provides for a naturally inclusive and diverse environment which leads to really good business results. We all know the importance of diversity and inclusion. I think there is definitely a place for open source in the world it's a matter providing it in such a way that creates business value that does enable and foster that growth of the community because nothing is better than having two or three or four or five million developers hacking away at my software to deliver better business value to my customers. The commercial side is going to be around the support, right? The enterprise customers would want to know that when bump goes in the night I've got someone I can pay to support my systems. And that's really what SUSE is about protecting our install base. Ensuring that we get them live, all the time every day and keep them running frictionlessly across their IT department. >> Now there's another model, the so-called open core model that holds that, the future is actually proprietary on top of an open base. So are you saying that you don't think that's a good model? >> I don't know, jury's out. Next time that you come to our event which is going to be in March, in Dublin. We're doing our SUSECON conference. Leave that question for me and I'll have an answer for you. I'm pontificating. >> Well I did and-- >> It's a date. The 12th of March. >> It's certainly working for Amazon. I mean, you know, Amazon's criticized for bogarting open source but Redshift is built on open source I think Aurora is built on open source. They're obviously making a lot of money. Your open core model failed for cloud era. Hortonworks was pure, Hortonworks had a model like, you know, you guys and RedHat and that didn't work and now that was kind of profitless prosperity of Hadoop and maybe that was sort of an over head-- >> I think our model, the future's open-source no question. It's just what level of open source within the sack do we keep proprietary or not, it's the case maybe, right? Do we allow open source in the bottom or the top or do we put some proprietary components on top to preserve and protect like an umbrella the core of which is open source. I don't know, we're thinking about that right now. We're trynna think what our future looks like. What the model should look like in the future for the industry. How can we service our customers best. At the end of the day, it's satisfying customer needs and solving business problems. If that's going to be, pure open source or open source with a little bit of proprietary to service the customer best that's what we're all going to be after, aren't we? >> So, there's no question that the innovation model is open source. I mean, I don't think that's a debate, the hard part is. Okay, how do you make money? A bit of open source for you guys. I mean, are you using open source technologies presumable you are, everybody is but-- >> So we're very open API's, who joined three years ago. We joined openapi.org. And so we've been one of the the leading ERP companies in the industry on publishing open API's and then we do a lot of customization work with our community and all of that's going on in GitHub. And so it's all open source, it's all out there for people who want it. Not everybody wants to be messing around in the core of a transaction engine and that's where you get into you know, the sort of the core argument of, you know which pieces should be people modifying? Do you want people in the kernel? Maybe, maybe not. And, you know, this is not my area of expertise so I'll defer to Melissa. Having people would be able to extend things in an open source model. Having people be able to find a library of customizations and components that can extend Acumatica, that's obviously a good thing. >> I mean, I think you hit on it with developers. I mean, that to me is the key lever. I mean, if I were a VM where I'd hire you know, 1000, 2000 open source software developers and say, "Go build next-generation apps and tools "and give it away." And then I'd say, "Okay, Michael Dell make you a hardware "run better in our software." That's a business model, you can make a lot of money-- >> 100% and we're, you know, we're going to be very acquisitive right now, we're looking for our future, right? We're looking to make a mark right now and where do we go next? How can we help predict the outcome next step in the marketplace when it pertains to, you know, the core of applications and the delivery mechanism in which we want to offer. The ease of being able to get thousands of mainframe customers with complex enterprise applications. Let's say, for example to the cloud. And a part of that is going to be the developer network. I mean, that's a really really big important segment for us and we're looking at companies. Who can we acquire? What's the business outcome? And what the developer networks look like. >> So Cloud and Edge, here got to be two huge opportunities for you, right? Again, it's all about developers. I think that's the right strategy at the Edge. You see a lot of Edge activity where somebody trying to throw a box at the Edge with the top down, in a traditional IT model. It's really the devs up, where I think-- >> It is, it is the dev ups, you're exactly right. Exactly right. >> Yeah, I mean, Edge is fascinating. That's going to be amazing what happens in the next 10 years and we don't even know, but we ship a construction edition we've got a customer that we're working with that's instrumenting all of their construction machinery on something like a thousand construction sites and feeding the sensor data into a Acumatica and so it's a way to keep track of all the machines and what's going on with them. You know, obviously shipping logistics the opportunity to start putting things like, you know, RFID tags on everything an instrument to all of that, out at the Edge. And then the issue is you get this huge amount of data and how do you process that and get the intelligence out of it and make the right decisions. >> Well, how do you? When data is plentiful, insights, you know, aren't is-- >> Yeah, well I think that's where the machine learning breakthroughs are going to happen. I mean, we've built out a team in the last three years on machine learning, all the guys who've been talking about Amazon, Microsoft, Google are all putting out machine learning engines that companies can pick up and start building models around. So we're doing one's around, you know inventory, logistics, shipping. We just release one on expense reports. You know, that really is where the innovation is happening right now. >> Okay, so you're not an inventor of AI you're going to take those technologies apply 'em to your business. >> Yeah, we don't want to be the engine builder we want to be the guys that are building the models and putting the insight for the industry on top that's our job. >> All right Melissa, we'll give you the final word and IFS World 2019, I think, is this your first one? >> It's my first one, yeah-- >> We say bumper sticker say when your truck's are pulling away or-- (laughs) >> A bumper sticker would say, "When you think about the future of open source "think about SUSE." (laughing) >> Dave: I love it. >> I'd say in the event, I mean, I'm super-impressed I think it's the group that's here is great the customers are really enthused and you know, I have zero bias so I'm just giving you my perspective. >> Yeah, I mean the ecosystem is robust here, I have to say. I think they said 400 partners and I was pleasantly surprised when I was walking around last-- >> This is your second one, isn't it? >> It's theCubes second one, my first. >> Oh your first, all right, well done. And so what do you think? Coming back? >> I would love to come back. Especially overseas, I know you guys do a bunch of stuff over seas. >> There you go, he wants to travel. >> Dublin in March? >> March the 12th. >> Dublin is a good place for sure so you're doing at the big conference? >> Yep, the big conference center and it's-- >> That is a great venue. >> And not just because the green thing but it's actually because (laughs). >> No, that's a really nice venue, it's modern It's got, I think three or four floors. >> It does, yeah yeah, we're looking forward to it. >> And then evening events at the, you know, the Guinness Storehouse. >> There you go. >> Exactly right. So we'll look forward to hosting you there. >> All right, great, see you there. >> We'll come with our tough questions for you. (laughing) >> Thanks you guys, I really appreciate your time. >> Thanks very much. >> Thank you for watching but right back, right after this short break you're watching theCube from IFS World in Boston be right back. (upbeat music)

(electronic music) >> Live, from Washington, DC, it's theCUBE, covering AWS Public Sector Summit 2018. Brought to you by Amazon Web Services and its ecosystem partners. >> Hey, welcome back. We're here live in Washington, D.C. It's theCUBE's coverage of AWS Public Sector Summit Amazon Web Services, Public Sector Summit. It's like re:Invent but also for public sector. But it's a global public sector. I'm John Furrier with Stu Miniman. Our next guest is Vincent Quah, who's the head of education, nonprofits, and healthcare in Asia, Pacific, and Japan for AWS. Welcome to theCUBE. >> Thanks, John, Stu. Great to be able to be here. >> You know, we constantly talk about cloud in the United States here, and people use the word GovCloud, and Teresa and I always kind of jokingly say, "No, it's bigger than GovCloud. It's global public sector." You bring an international perspective covering APAC for AWS? >> Yes, absolutely. >> Public sector, okay. Outside of China, which is a different division with Amazon, you got the whole world. So Teresa and the team are looking not just at the US, it's the entire world. What's different? How's that working? Give us an update. >> I think one of the key differences that we see is that the US has really led the way in terms of the adoption of cloud technologies. We had great examples of universities that have really gone all in. What we are seeing now is that universities and education institutions in Asia, they're beginning to pick up their pace. And it's exciting to see some of the universities really coming very strongly using AWS. And we're seeing this across not just in mature countries and developed countries, but also in developing countries. And so it is a very widespread adoption of the cloud. And we're very excited by that. Tell us about the AWS Educate. Teresa Carlson on stage yesterday very highlighted much in her keynote about education, as well as some of the that they're doing with retraining and educating young people and whatnot, but really education has been a real growth area, from interest with cloud. Because old IT (laughs) okay, you look at that, okay, there's never had a lot of IT guys. (Vincent laughs) But it's really changed both technology procurement and delivery, but also the impact. >> Right. >> Talk about the AWS Educate program. >> So the AWS Educate program is a free program that all institutions can join. It comes with content from AWS, it comes with content from some of the top computer science universities in the world, as well as Cloud Credits, where individual student members, or the educator's members, they can actually get access to using the real platform that AWS provide. Now, this is really game-changing for students and for the institution. And it's game-changing because they have exactly the same access to all the 125-plus technologies that AWS provide to enterprises and now they are in the hands of students. So can you imagine, if they have the experience using some of these services, building capabilities, building solutions and services, and bringing out to the market. So now, innovation is in the hands of every single individual. And Educate is such an important program to re-skill and skill graduates to be ready for the working world. >> I love that, Vincent. I think back, most of my career, when you talked about education, you talked about research and universities. So it was a certain top-tier and a very limited amount. You're really democratizing what's happening. Wonder if you have any examples, or what sort of innovations are coming out of some of these global initiatives? One of the great example is NOVA, right. So we've announced that NOVA is now building this cloud associate degree as part of their information systems technology. >> What's NOVA again? >> The Northern Virginia Community College. >> In the keynote yesterday, not to be confused with Villanova, the basketball champs. >> Northern Virginia, got it, sorry. >> So, there's a need there that the institutions see because there's so much that the industry would need in terms of skills and graduates graduating with the right skill set. If you look at the World Economic Forum that was published in 2016, more about Internet and cloud computing are the two key technological drivers that's creating all these change in the industry. And many, many organizations are now investing into skilling and re-skilling. Educate sits so nicely to this particular part of the agenda. Apart from what NOVA has done here in the US, there are two other examples I want to quickly highlight to you. The first is, in the first week of June, we actually did an event in the Philippines. It was a large-scale student event. We had more than hundreds of students in a single location, with probably close to 100 educators. We took them through a four-day event. Two days of skills and content learning with hands-on experience. A third day on a gamified challenge that we put the students through so that they can compete with one another in groups, and thereby achieving top-notch scores in the leaderboard. And at the end of the day, they actually get to also develop a curriculum vitae, a CV, that they can actually submit to companies. And on the fourth day, we brought more than 20 companies as part of this whole event, and we got the students to actually connect with the companies, and the companies to the students, so that where the companies are looking for jobs, these are the students that are ready with skills that they have learned over the past three days, that they can apply to jobs that these company are looking for. So that's a really strong case of what we see working. Connecting skills to companies that are looking for students with the right set of skills. >> Talk about the international global landscape for a minute. You have a unique perspective in your job. What are the key things going on out there? What's the progress look like? What are some of the successes? Can you share a little bit about what's going on in Asia, Pacific, and Japan? >> Sure. There'll be two examples that I'll be sharing. The first is, we know that AWS Educate started off at the tertiary level. But then, last re:Invent is now being extended to 14 years and above. So now children at that age can learn about the cloud and be made aware of what's the potential of the cloud and what they can learn and use the cloud for. We've also begun to extend that work into the adult working workforce. One very specific example that I can share with you. There is an organization in Singapore called the National Trade Unions Congress LearningHub. They're an education service provider and they provide education services to citizens of Singapore. We have worked with them. They're using the AWS Educate content, and they develop two courses. Fundamentals in Cloud Computing and Fundamentals in IoT. They bring this pilot courses for the Fundamentals in IoT to a group of individuals age 45 to 74 years old. And they came away, the course just simply blew their mind away. They were so excited about what they have learned. How to program, actually, I have with me, an Internet of Things button. Now they can actually come up with an idea, program an activity on this button, so that it trigger off a particular reaction. And that's the excitement that these individuals 45 to 74 years old. They have the domain expertise, now they need is just an idea and a platform. >> It's also entrepreneurial too. >> Absolutely. >> They can tinker with the software, learn about the cloud at a very young age, and they can grow into it and maybe start something compelling, have a unique idea, fresh perspective. >> Correct. >> Or, someone who's retraining, to get a new job. >> Correct. And innovation is, we keep thinking of innovation as something that's really big. But actually, innovation doesn't have to be that way. It can start very small and then scale up from there. And all you need is just an idea to apply. >> All right. So Vincent, one of the themes we've been talking a lot about at the show is cybersecurity. Can you speak how that discussion plays specifically in the education markets? >> What we want to do is really raise the awareness of every individual's understanding of cloud computing. And by that I mean from 14 years to 74 years old. We want to let them know, actually, they are already interacting with cloud technologies. For example, if you have a Samsung Smart TV at home, if you have made a hotel booking through Expedia or through Airbnb, or if you have called for home delivery from McDonald's, you've already interacted with the cloud. And so what we want to do is make sure that everybody actually understand that. And then through some of these courses that are being provided by our partners, then they can go and learn about the security part of it. And help them have a much better sense of idea of, look, the cloud is actually a lot more secure. And we've heard many examples of that today and yesterday. And we want to give them that assurance that what they are doing and consuming, they can be part of that entrepreneur process to create something new and very exciting. >> Vincent, I'll give you the last word on this interview by sharing the update from Asia Pacific AWS. How many people are out there's a growing, you're hiring. What are some of the priorities you guys have. They have a big event in Singapore, I know that. We've been watching it, thinking about bringing theCUBE there. Give us some idea of the growth around the AWS people. What's the head count look like, give us some estimations. John, you know I can't really talk too much about head count, but I can say that we are definitely growing our AWS head count very, very rapidly. The needs and requirements out there in the market is so tremendous, and we want to be able to serve the customer as best as we can. We are a customer-obsessed company, and so we want to be there with the customer, work with them to really meet the objective and the goals that they have. And help them achieve that vision. And so we are just the enabler. We empower the customer to make. >> You have events out there too, right? You have the re:Invent, Summit? >> We have the AWS Summit, and this coming October we have the Public Sector Summit here in Singapore, as well as in Canberra in September. >> Right. >> And there's an education event coming domestically, too. >> And there's an education, a global education event that is happening in Seattle in August. So we're very excited about that. >> Lot of action on the AWS ecosystem. Congratulations, you guys do a great job. Thanks for coming on theCUBE, Vincent. Really appreciate it. We're here live in Washington, DC. It's theCUBE's coverage of AWS Public Sector Summit. I'm John Furrier with Stu Miniman. We've got Dave Vellante here as well, coming and joining us for some interviews. We'll be right back, stay with us for more coverage after this short break. (electronic music)

[Music] [Music] [Music] [Laughter] [Laughter] [Laughter] [Laughter] [Music] [Music] [Music] [Music] you you [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Applause] [Music] wake up feeling blessed peace you warned that Russia ain't afraid to show it I'll expose it if I dressed up riding in that Chester roasted nigga catch you slippin on myself rocks on I messed up like yes sir [Music] [Music] [Music] [Music] our program [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] you are not welcome to Red Hat summit 2018 2018 [Music] [Music] [Music] [Laughter] [Music] Wow that is truly the coolest introduction I've ever had thank you Wow I don't think I feel cool enough to follow an interaction like that Wow well welcome to the Red Hat summit this is our 14th annual event and I have to say looking out over this audience Wow it's great to see so many people here joining us this is by far our largest summit to date not only did we blow through the numbers we've had in the past we blew through our own expectations this year so I know we have a pretty packed house and I know people are still coming in so it's great to see so many people here it's great to see so many familiar faces when I had a chance to walk around earlier it's great to see so many new people here joining us for the first time I think the record attendance is an indication that more and more enterprises around the world are seeing the power of open source to help them with their challenges that they're facing due to the digital transformation that all of enterprises around the world are going through the theme for the summit this year is ideas worth exploring and we intentionally chose that because as much as we are all going through this digital disruption and the challenges associated with it one thing I think is becoming clear no one person and certainly no one company has the answers to these challenges right this isn't a problem where you can go buy a solution this is a set of capabilities that we all need to build it's a set of cultural changes that we all need to go through and that's going to require the best ideas coming from so many different places so we're not here saying we have the answers we're trying to convene the conversation right we want to serve as a catalyst bringing great minds together to share ideas so we all walk out of here at the end of the week a little wiser than when we first came here we do have an amazing agenda for you we have over 7,000 attendees we may be pushing 8,000 by the time we got through this morning we have 36 keynote speakers and we have a hundred and twenty-five breakout sessions and have to throw in one plug scheduling 325 breakout sessions is actually pretty difficult and so we used the Red Hat business optimizer which is an AI constraint solver that's new in the Red Hat decision manager to help us plan the summit because we have individuals who have a clustered set of interests and we want to make sure that when we schedule two breakout sessions we do it in a way that we don't have overlapping sessions that are really important to the same individual so we tried to use this tool and what we understand about people's interest in history of what they wanted to do to try to make sure that we spaced out different times for things of similar interests for similar people as well as for people who stood in the back of breakouts before and I know I've done that too we've also used it to try to optimize room size so hopefully we will do our best to make sure that we've appropriately sized the spaces for those as well so it's really a phenomenal tool and I know it's helped us a lot this year in addition to the 325 breakouts we have a lot of our customers on stage during the main sessions and so you'll see demos you'll hear from partners you'll hear stories from so many of our customers not on our point of view of how to use these technologies but their point of views of how they actually are using these technologies to solve their problems and you'll hear over and over again from those keynotes that it's not just about the technology it's about how people are changing how people are working to innovate to solve those problems and while we're on the subject of people I'd like to take a moment to recognize the Red Hat certified professional of the year this is known award we do every year I love this award because it truly recognizes an individual for outstanding innovation for outstanding ideas for truly standing out in how they're able to help their organization with Red Hat technologies Red Hat certifications help system administrators application developers IT architects to further their careers and help their organizations by being able to advance their skills and knowledge of Red Hat products and this year's winner really truly is a great example about how their curiosity is helped push the limits of what's possible with technology let's hear a little more about this year's winner when I was studying at the University I had computer science as one of my subjects and that's what created the passion from the very beginning they were quite a few institutions around my University who were offering Red Hat Enterprise Linux as a course and a certification paths through to become an administrator Red Hat Learning subscription has offered me a lot more than any other trainings that have done so far that gave me exposure to so many products under red hair technologies that I wasn't even aware of I started to think about the better ways of how these learnings can be put into the real life use cases and we started off with a discussion with my manager saying I have to try this product and I really want to see how it really fits in our environment and that product was Red Hat virtualization we went from deploying rave and then OpenStack and then the open shift environment we wanted to overcome some of the things that we saw as challenges to the speed and rapidity of release and code etc so it made perfect sense and we were able to do it in a really short space of time so you know we truly did use it as an Innovation Lab I think idea is everything ideas can change the way you see things an Innovation Lab was such an idea that popped into my mind one fine day and it has transformed the way we think as a team and it's given that playpen to pretty much everyone to go and test their things investigate evaluate do whatever they like in a non-critical non production environment I recruited Neha almost 10 years ago now I could see there was a spark a potential with it and you know she had a real Drive a real passion and you know here we are nearly ten years later I'm Neha Sandow I am a Red Hat certified engineer all right well everyone please walk into the states to the stage Neha [Music] [Applause] congratulations thank you [Applause] I think that - well welcome to the red has some of this is your first summit yes it is thanks so much well fantastic sure well it's great to have you here I hope you have a chance to engage and share some of your ideas and enjoy the week thank you thank you congratulations [Applause] neha mentioned that she first got interest in open source at university and it made me think red hats recently started our Red Hat Academy program that looks to programmatically infuse Red Hat technologies in universities around the world it's exploded in a way we had no idea it's grown just incredibly rapidly which i think shows the interest that there really is an open source and working in an open way at university so it's really a phenomenal program I'm also excited to announce that we're launching our newest open source story this year at Summit it's called the science of collective discovery and it looks at what happens when communities use open hardware to monitor the environment around them and really how they can make impactful change based on that technologies the rural premier that will be at 5:15 on Wednesday at McMaster Oni West and so please join us for a drink and we'll also have a number of the experts featured in that and you can have a conversation with them as well so with that let's officially start the show please welcome red hat president of products and technology Paul Cormier [Music] Wow morning you know I say it every year I'm gonna say it again I know I repeat myself it's just amazing we are so proud here to be here today too while you all week on how far we've come with opens with open source and with the products that we that we provide at Red Hat so so welcome and I hope the pride shows through so you know I told you Seven Summits ago on this stage that the future would be open and here we are just seven years later this is the 14th summit but just seven years later after that and much has happened and I think you'll see today and this week that that prediction that the world would be open was a pretty safe predict prediction but I want to take you just back a little bit to see how we started here and it's not just how Red Hat started here this is an open source in Linux based computing is now in an industry norm and I think that's what you'll you'll see in here this week you know we talked back then seven years ago when we put on our prediction about the UNIX error and how Hardware innovation with x86 was it was really the first step in a new era of open innovation you know companies like Sun Deck IBM and HP they really changed the world the computing industry with their UNIX models it was that was really the rise of computing but I think what we we really saw then was that single company innovation could only scale so far could really get so far with that these companies were very very innovative but they coupled hardware innovation with software innovation and as one company they could only solve so many problems and even which comp which even complicated things more they could only hire so many people in each of their companies Intel came on the scene back then as the new independent hardware player and you know that was really the beginning of the drive for horizontal computing power and computing this opened up a brand new vehicle for hardware innovation a new hardware ecosystem was built around this around this common hardware base shortly after that Stallman and leanness they had a vision of his of an open model that was created and they created Linux but it was built around Intel this was really the beginning of having a software based platform that could also drive innovation this kind of was the beginning of the changing of the world here that system-level innovation now having a hardware platform that was ubiquitous and a software platform that was open and ubiquitous it really changed this system level innovation and that continues to thrive today it was only possible because it was open this could not have happened in a closed environment it allowed the best ideas from anywhere from all over to come in in win only because it was the best idea that's what drove the rate of innovation at the pace you're seeing today and it which has never been seen before we at Red Hat we saw the need to bring this innovation to solve real-world problems in the enterprise and I think that's going to be the theme of the show today you're going to see us with our customers and partners talking about and showing you some of those real-world problems that we are sought solving with this open innovation we created rel back then for this for the enterprise it started it's it it wasn't successful because it's scaled it was secure and it was enterprise ready it once again changed the industry but this time through open innovation this gave the hardware ecosystem a software platform this open software platform gave the hardware ecosystem a software platform to build around it Unleashed them the hardware side to compete and thrive it enabled innovation from the OEMs new players building cheaper faster servers even new architectures from armed to power sprung up with this change we have seen an incredible amount of hardware innovation over the last 15 years that same innovation happened on the software side we saw powerful implementations of bare metal Linux distributions out in the market in fact at one point there were 300 there are over 300 distributions out in the market on the foundation of Linux powerful open-source equivalents were even developed in every area of Technology databases middleware messaging containers anything you could imagine innovation just exploded around the Linux platform in innovation it's at the core also drove virtualization both Linux and virtualization led to another area of innovation which you're hearing a lot about now public cloud innovation this innovation started to proceed at a rate that we had never seen before we had never experienced this in the past in this unprecedented speed of innovation and software was now possible because you didn't need a chip foundry in order to innovate you just needed great ideas in the open platform that was out there customers seeing this innovation in the public cloud sparked it sparked their desire to build their own linux based cloud platforms and customers are now are now bringing that cloud efficiency on-premise in their own data centers public clouds demonstrated so much efficiency the data centers and architects wanted to take advantage of it off premise on premise I'm sorry within their own we don't within their own controlled environments this really allowed companies to make the most of existing investments from data centers to hardware they also gained many new advantages from data sovereignty to new flexible agile approaches I want to bring Burr and his team up here to take a look at what building out an on-premise cloud can look like today Bure take it away I am super excited to be with all of you here at Red Hat summit I know we have some amazing things to show you throughout the week but before we dive into this demonstration I want you to take just a few seconds just a quick moment to think about that really important event your life that moment you turned on your first computer maybe it was a trs-80 listen Claire and Atari I even had an 83 b2 at one point but in my specific case I was sitting in a classroom in Hawaii and I could see all the way from Diamond Head to Pearl Harbor so just keep that in mind and I turn on an IBM PC with dual floppies I don't remember issuing my first commands writing my first level of code and I was totally hooked it was like a magical moment and I've been hooked on computers for the last 30 years so I want you to hold that image in your mind for just a moment just a second while we show you the computers we have here on stage let me turn this over to Jay fair and Dini here's our worldwide DevOps manager and he was going to show us his hardware what do you got Jay thank you BER good morning everyone and welcome to Red Hat summit we have so many cool things to show you this week I am so happy to be here and you know my favorite thing about red hat summit is our allowed to kind of share all of our stories much like bird just did we also love to you know talk about the hardware and the technology that we brought with us in fact it's become a bit of a competition so this year we said you know let's win this thing and we actually I think we might have won we brought a cloud with us so right now this is a private cloud for throughout the course of the week we're going to turn this into a very very interesting open hybrid cloud right before your eyes so everything you see here will be real and happening right on this thing right behind me here so thanks for our four incredible partners IBM Dell HP and super micro we've built a very vendor heterogeneous cloud here extra special thanks to IBM because they loaned us a power nine machine so now we actually have multiple architectures in this cloud so as you know one of the greatest benefits to running Red Hat technology is that we run on just about everything and you know I can't stress enough how powerful that is how cost-effective that is and it just makes my life easier to be honest so if you're interested the people that built this actual rack right here gonna be hanging out in the customer success zone this whole week it's on the second floor the lobby there and they'd be glad to show you exactly how they built this thing so let me show you what we actually have in this rack so contained in this rack we have 1056 physical chorus right here we have five and a half terabytes of RAM and just in case we threw 50 terabytes of storage in this thing so burr that's about two million times more powerful than that first machine you boot it up thanks to a PC we're actually capable of putting all the power needs and cooling right in this rack so there's your data center right there you know it occurred to me last night that I can actually pull the power cord on this thing and kick it up a notch we could have the world's first mobile portable hybrid cloud so I'm gonna go ahead and unplug no no no no no seriously it's not unplug the thing we got it working now well Berg gets a little nervous but next year we're rolling this thing around okay okay so to recap multiple vendors check multiple architectures check multiple public clouds plug right into this thing check and everything everywhere is running the same software from Red Hat so that is a giant check so burn Angus why don't we get the demos rolling awesome so we have totally we have some amazing hardware amazing computers on this stage but now we need to light it up and we have Angus Thomas who represents our OpenStack engineering team and he's going to show us what we can do with this awesome hardware Angus thank you Beth so this was an impressive rack of hardware to Joe has bought a pocket stage what I want to talk about today is putting it to work with OpenStack platform director we're going to turn it from a lot of potential into a flexible scalable private cloud we've been using director for a while now to take care of managing hardware and orchestrating the deployment of OpenStack what's new is that we're bringing the same capabilities for on-premise manager the deployment of OpenShift director deploying OpenShift in this way is the best of both worlds it's bare-metal performance but with an underlying infrastructure as a service that can take care of deploying in new instances and scaling out and a lot of the things that we expect from a cloud provider director is running on a virtual machine on Red Hat virtualization at the top of the rack and it's going to bring everything else under control what you can see on the screen right now is the director UI and as you see some of the hardware in the rack is already being managed at the top level we have information about the number of cores in the amount of RAM and the disks that each machine have if we dig in a bit there's information about MAC addresses and IPs and the management interface the BIOS kernel version dig a little deeper and there is information about the hard disks all of this is important because we want to be able to make sure that we put in workloads exactly where we want them Jay could you please power on the two new machines at the top of the rack sure all right thank you so when those two machines come up on the network director is going to see them see that they're new and not already under management and is it immediately going to go into the hardware inspection that populates this database and gets them ready for use so we also have profiles as you can see here profiles are the way that we match the hardware in a machine to the kind of workload that it's suited to this is how we make sure that machines that have all the discs run Seth and machines that have all the RAM when our application workouts for example there's two ways these can be set when you're dealing with a rack like this you could go in an individually tag each machine but director scales up to data centers so we have a rules matching engine which will automatically take the hardware profile of a new machine and make sure it gets tagged in exactly the right way so we can automatically discover new machines on the network and we can automatically match them to a profile that's how we streamline and scale up operations now I want to talk about deploying the software we have a set of validations we've learned over time about the Miss configurations in the underlying infrastructure which can cause the deployment of a multi node distributed application like OpenStack or OpenShift to fail if you have the wrong VLAN tags on a switch port or DHCP isn't running where it should be for example you can get into a situation which is really hard to debug a lot of our validations actually run before the deployment they look at what you're intending to deploy and they check in the environment is the way that it should be and they'll preempts problems and obviously preemption is a lot better than debugging something new that you probably have not seen before is director managing multiple deployments of different things side by side before we came out on stage we also deployed OpenStack on this rack just to keep me honest let me jump over to OpenStack very quickly a lot of our opens that customers will be familiar with this UI and the bare metal deployment of OpenStack on our rack is actually running a set of virtual machines which is running Gluster you're going to see that put to work later on during the summit Jay's gone to an awful lot effort to get this Hardware up on the stage so we're going to use it as many different ways as we can okay let's deploy OpenShift if I switch over to the deployed a deployment plan view there's a few steps first thing you need to do is make sure we have the hardware I already talked about how director manages hardware it's smart enough to make sure that it's not going to attempt to deploy into machines they're already in use it's only going to deploy on machines that have the right profile but I think with the rack that we have here we've got enough next thing is the deployment configuration this is where you get to customize exactly what's going to be deployed to make sure that it really matches your environment if they're external IPs for additional services you can set them here whatever it takes to make sure that the deployment is going to work for you as you can see on the screen we have a set of options around enable TLS for encryption network traffic if I dig a little deeper there are options around enabling ipv6 and network isolation so that different classes of traffic there are over different physical NICs okay then then we have roles now roles this is essentially about the software that's going to be put on each machine director comes with a set of roles for a lot of the software that RedHat supports and you can just use those or you can modify them a little bit if you need to add a monitoring agent or whatever it might be or you can create your own custom roles director has quite a rich syntax for custom role definition and custom Network topologies whatever it is you need in order to make it work in your environment so the rawls that we have right now are going to give us a working instance of openshift if I go ahead and click through the validations are all looking green so right now I can click the button start to the deploy and you will see things lighting up on the rack directors going to use IPMI to reboot the machines provisioned and with a trail image was the containers on them and start up the application stack okay so one last thing once the deployment is done you're going to want to keep director around director has a lot of capabilities around what we call de to operational management bringing in new Hardware scaling out deployments dealing with updates and critically doing upgrades as well so having said all of that it is time for me to switch over to an instance of openshift deployed by a director running on bare metal on our rack and I need to hand this over to our developer team so they can show what they can do it thank you that is so awesome Angus so what you've seen now is going from bare metal to the ultimate private cloud with OpenStack director make an open shift ready for our developers to build their next generation applications thank you so much guys that was totally awesome I love what you guys showed there now I have the honor now I have the honor of introducing a very special guest one of our earliest OpenShift customers who understands the necessity of the private cloud inside their organization and more importantly they're fundamentally redefining their industry please extend a warm welcome to deep mar Foster from Amadeus well good morning everyone a big thank you for having armadillos here and myself so as it was just set I'm at Mario's well first of all we are a large IT provider in the travel industry so serving essentially Airlines hotel chains this distributors like Expedia and others we indeed we started very early what was OpenShift like a bit more than three years ago and we jumped on it when when Retta teamed with Google to bring in kubernetes into this so let me quickly share a few figures about our Mario's to give you like a sense of what we are doing and the scale of our operations so some of our key KPIs one of our key metrics is what what we call passenger borders so that's the number of customers that physically board a plane over the year so through our systems it's roughly 1.6 billion people checking in taking the aircrafts on under the Amarillo systems close to 600 million travel agency bookings virtually all airlines are on the system and one figure I want to stress out a little bit is this one trillion availability requests per day that's when I read this figure my mind boggles a little bit so this means in continuous throughput more than 10 million hits per second so of course these are not traditional database transactions it's it's it's highly cached in memory and these applications are running over like more than 100,000 course so it's it's it's really big stuff so today I want to give some concrete feedback what we are doing so I have chosen two applications products of our Mario's that are currently running on production in different in different hosting environments as the theme here is of this talk hybrid cloud and so I want to give some some concrete feedback of how we architect the applications and of course it stays relatively high level so here I have taken one of our applications that is used in the hospitality environment so it's we have built this for a very large US hotel chain and it's currently in in full swing brought into production so like 30 percent of the globe or 5,000 plus hotels are on this platform not so here you can see that we use as the path of course on openshift on that's that's the most central piece of our hybrid cloud strategy on the database side we use Oracle and Couchbase Couchbase is used for the heavy duty fast access more key value store but also to replicate data across two data centers in this case it's running over to US based data centers east and west coast topology that are fit so run by Mario's that are fit with VMware on for the virtualization OpenStack on top of it and then open shift to host and welcome the applications on the right hand side you you see the kind of tools if you want to call them tools that we use these are the principal ones of course the real picture is much more complex but in essence we use terraform to map to the api's of the underlying infrastructure so they are obviously there are differences when you run on OpenStack or the Google compute engine or AWS Azure so some some tweaking is needed we use right at ansible a lot we also use puppet so you can see these are really the big the big pieces of of this sense installation and if we look to the to the topology again very high high level so these two locations basically map the data centers of our customers so they are in close proximity because the response time and the SLA is of this application is are very tight so that's an example of an application that is architectures mostly was high ability and high availability in minds not necessarily full global worldwide scaling but of course it could be scaled but here the idea is that we can swing from one data center to the unit to the other in matters of of minutes both take traffic data is fully synchronized across those data centers and while the switch back and forth is very fast the second example I have taken is what we call the shopping box this is when people go to kayak or Expedia and they're getting inspired where they want to travel to this is really the piece that shoots most of transit of the transactions into our Mario's so we architect here more for high scalability of course availability is also a key but here scaling and geographical spread is very important so in short it runs partially on-premise in our Amarillo Stata Center again on OpenStack and we we deploy it mostly in the first step on the Google compute engine and currently as we speak on Amazon on AWS and we work also together with Retta to qualify the whole show on Microsoft Azure here in this application it's it's the same building blocks there is a large swimming aspect to it so we bring Kafka into this working with records and another partner to bring Kafka on their open shift because at the end we want to use open shift to administrate the whole show so over time also databases and the topology here when you look to the physical deployment topology while it's very classical we use the the regions and the availability zone concept so this application is spread over three principal continental regions and so it's again it's a high-level view with different availability zones and in each of those availability zones we take a hit of several 10,000 transactions so that was it really in very short just to give you a glimpse on how we implement hybrid clouds I think that's the way forward it gives us a lot of freedom and it allows us to to discuss in a much more educated way with our customers that sometimes have already deals in place with one cloud provider or another so for us it's a lot of value to set two to leave them the choice basically what up that was a very quick overview of what we are doing we were together with records are based on open shift essentially here and more and more OpenStack coming into the picture hope you found this interesting thanks a lot and have a nice summer [Applause] thank you so much deeper great great solution we've worked with deep Marv and his team for a long for a long time great solution so I want to take us back a little bit I want to circle back I sort of ended talking a little bit about the public cloud so let's circle back there you know even so even though some applications need to run in various footprints on premise there's still great gains to be had that for running certain applications in the public cloud a public cloud will be as impactful to to the industry as as UNIX era was of computing was but by itself it'll have some of the same limitations and challenges that that model had today there's tremendous cloud innovation happening in the public cloud it's being driven by a handful of massive companies and much like the innovation that sundeck HP and others drove in a you in the UNIX era of community of computing many customers want to take advantage of the best innovation no matter where it comes from buddy but as they even eventually saw in the UNIX era they can't afford the best innovation at the cost of a siloed operating environment with the open community we are building a hybrid application platform that can give you access to the best innovation no matter which vendor or which cloud that it comes from letting public cloud providers innovate and services beyond what customers or anyone can one provider can do on their own such as large scale learning machine learning or artificial intelligence built on the data that's unique probably to that to that one cloud but consumed in a common way for the end customer across all applications in any environment on any footprint in in their overall IT infrastructure this is exactly what rel brought brought to our customers in the UNIX era of computing that consistency across any of those footprints obviously enterprises will have applications for all different uses some will live on premise some in the cloud hybrid cloud is the only practical way forward I think you've been hearing that from us for a long time it is the only practical way forward and it'll be as impactful as anything we've ever seen before I want to bring Byrne his team back to see a hybrid cloud deployment in action burr [Music] all right earlier you saw what we did with taking bare metal and lighting it up with OpenStack director and making it openshift ready for developers to build their next generation applications now we want to show you when those next turn and generation applications and what we've done is we take an open shift and spread it out and installed it across Asia and Amazon a true hybrid cloud so with me on stage today as Ted who's gonna walk us through an application and Brent Midwood who's our DevOps engineer who's gonna be making sure he's monitoring on the backside that we do make sure we do a good job so at this point Ted what have you got for us Thank You BER and good morning everybody this morning we are running on the stage in our private cloud an application that's providing its providing fraud detection detect serves for financial transactions and our customer base is rather large and we occasionally take extended bursts of traffic of heavy traffic load so in order to keep our latency down and keep our customers happy we've deployed extra service capacity in the public cloud so we have capacity with Microsoft Azure in Texas and with Amazon Web Services in Ohio so we use open chip container platform on all three locations because openshift makes it easy for us to deploy our containerized services wherever we want to put them but the question still remains how do we establish seamless communication across our entire enterprise and more importantly how do we balance the workload across these three locations in such a way that we efficiently use our resources and that we give our customers the best possible experience so this is where Red Hat amq interconnect comes in as you can see we've deployed a MQ interconnect alongside our fraud detection applications in all three locations and if I switch to the MQ console we'll see the topology of the app of the network that we've created here so the router inside the on stage here has made connections outbound to the public routers and AWS and Azure these connections are secured using mutual TLS authentication and encrypt and once these connections are established amq figures out the best way auda matically to route traffic to where it needs to get to so what we have right now is a distributed reliable broker list message bus that expands our entire enterprise now if you want to learn more about this make sure that you catch the a MQ breakout tomorrow at 11:45 with Jack Britton and David Ingham let's have a look at the message flow and we'll dive in and isolate the fraud detection API that we're interested in and what we see is that all the traffic is being handled in the private cloud that's what we expect because our latencies are low and they're acceptable but now if we take a little bit of a burst of increased traffic we're gonna see that an EQ is going to push a little a bi traffic out onto the out to the public cloud so as you're picking up some of the load now to keep the Layton sees down now when that subsides as your finishes up what it's doing and goes back offline now if we take a much bigger load increase you'll see two things first of all asher is going to take a bigger proportion than it did before and Amazon Web Services is going to get thrown into the fray as well now AWS is actually doing less work than I expected it to do I expected a little bit of bigger a slice there but this is a interesting illustration of what's going on for load balancing mq load balancing is sending requests to the services that have the lowest backlog and in order to keep the Layton sees as steady as possible so AWS is probably running slowly for some reason and that's causing a and Q to push less traffic its way now the other thing you're going to notice if you look carefully this graph fluctuate slightly and those fluctuations are caused by all the variances in the network we have the cloud on stage and we have clouds in in the various places across the country there's a lot of equipment locked layers of virtualization and networking in between and we're reacting in real-time to the reality on the digital street so BER what's the story with a to be less I noticed there's a problem right here right now we seem to have a little bit performance issue so guys I noticed that as well and a little bit ago I actually got an alert from red ahead of insights letting us know that there might be some potential optimizations we could make to our environment so let's take a look at insights so here's the Red Hat insights interface you can see our three OpenShift deployments so we have the set up here on stage in San Francisco we have our Azure deployment in Texas and we also have our AWS deployment in Ohio and insights is highlighting that that deployment in Ohio may have some issues that need some attention so Red Hat insights collects anonymized data from manage systems across our customer environment and that gives us visibility into things like vulnerabilities compliance configuration assessment and of course Red Hat subscription consumption all of this is presented in a SAS offering so it's really really easy to use it requires minimal infrastructure upfront and it provides an immediate return on investment what insights is showing us here is that we have some potential issues on the configuration side that may need some attention from this view I actually get a look at all the systems in our inventory including instances and containers and you can see here on the left that insights is highlighting one of those instances as needing some potential attention it might be a candidate for optimization this might be related to the issues that you were seeing just a minute ago insights uses machine learning and AI techniques to analyze all collected data so we combine collected data from not only the system's configuration but also with other systems from across the Red Hat customer base this allows us to compare ourselves to how we're doing across the entire set of industries including our own vertical in this case the financial services industry and we can compare ourselves to other customers we also get access to tailored recommendations that let us know what we can do to optimize our systems so in this particular case we're actually detecting an issue here where we are an outlier so our configuration has been compared to other configurations across the customer base and in this particular instance in this security group were misconfigured and so insights actually gives us the steps that we need to use to remediate the situation and the really neat thing here is that we actually get access to a custom ansible playbook so if we want to automate that type of a remediation we can use this inside of Red Hat ansible tower Red Hat satellite Red Hat cloud forms it's really really powerful the other thing here is that we can actually apply these recommendations right from within the Red Hat insights interface so with just a few clicks I can select all the recommendations that insights is making and using that built-in ansible automation I can apply those recommendations really really quickly across a variety of systems this type of intelligent automation is really cool it's really fast and powerful so really quickly here we're going to see the impact of those changes and so we can tell that we're doing a little better than we were a few minutes ago when compared across the customer base as well as within the financial industry and if we go back and look at the map we should see that our AWS employment in Ohio is in a much better state than it was just a few minutes ago so I'm wondering Ted if this had any effect and might be helping with some of the issues that you were seeing let's take a look looks like went green now let's see what it looks like over here yeah doesn't look like the configuration is taking effect quite yet maybe there's some delay awesome fantastic the man yeah so now we're load balancing across the three clouds very much fantastic well I have two minute Ted I truly love how we can route requests and dynamically load transactions across these three clouds a truly hybrid cloud native application you guys saw here on on stage for the first time and it's a fully portable application if you build your applications with openshift you can mover from cloud to cloud to cloud on stage private all the way out to the public said it's totally awesome we also have the application being fully managed by Red Hat insights I love having that intelligence watching over us and ensuring that we're doing everything correctly that is fundamentally awesome thank you so much for that well we actually have more to show you but you're going to wait a few minutes longer right now we'd like to welcome Paul back to the stage and we have a very special early Red Hat customer an Innovation Award winner from 2010 who's been going boldly forward with their open hybrid cloud strategy please give a warm welcome to Monty Finkelstein from Citigroup [Music] [Music] hi Marty hey Paul nice to see you thank you very much for coming so thank you for having me Oh our pleasure if you if you wanted to we sort of wanted to pick your brain a little bit about your experiences and sort of leading leading the charge in computing here so we're all talking about hybrid cloud how has the hybrid cloud strategy influenced where you are today in your computing environment so you know when we see the variable the various types of workload that we had an hour on from cloud we see the peaks we see the valleys we see the demand on the environment that we have we really determined that we have to have a much more elastic more scalable capability so we can burst and stretch our environments to multiple cloud providers these capabilities have now been proven at City and of course we consider what the data risk is as well as any regulatory requirement so how do you how do you tackle the complexity of multiple cloud environments so every cloud provider has its own unique set of capabilities they have they're own api's distributions value-added services we wanted to make sure that we could arbitrate between the different cloud providers maintain all source code and orchestration capabilities on Prem to drive those capabilities from within our platforms this requires controlling the entitlements in a cohesive fashion across our on Prem and Wolfram both for security services automation telemetry as one seamless unit can you talk a bit about how you decide when you to use your own on-premise infrastructure versus cloud resources sure so there are multiple dimensions that we take into account right so the first dimension we talk about the risk so low risk - high risk and and really that's about the data classification of the environment we're talking about so whether it's public or internal which would be considered low - ooh confidential PII restricted sensitive and so on and above which is really what would be considered a high-risk the second dimension would be would focus on demand volatility and responsiveness sensitivity so this would range from low response sensitivity and low variability of the type of workload that we have to the high response sensitivity and high variability of the workload the first combination that we focused on is the low risk and high variability and high sensitivity for response type workload of course any of the workloads we ensure that we're regulatory compliant as well as we achieve customer benefits with within this environment so how can we give developers greater control of their their infrastructure environments and still help operations maintain that consistency in compliance so the main driver is really to use the public cloud is scale speed and increased developer efficiencies as well as reducing cost as well as risk this would mean providing develop workspaces and multiple environments for our developers to quickly create products for our customers all this is done of course in a DevOps model while maintaining the source and artifacts registry on-prem this would allow our developers to test and select various middleware products another product but also ensure all the compliance activities in a centrally controlled repository so we really really appreciate you coming by and sharing that with us today Monte thank you so much for coming to the red echo thanks a lot thanks again tamati I mean you know there's these real world insight into how our products and technologies are really running the businesses today that's that's just the most exciting part so thank thanks thanks again mati no even it with as much progress as you've seen demonstrated here and you're going to continue to see all week long we're far from done so I want to just take us a little bit into the path forward and where we we go today we've talked about this a lot innovation today is driven by open source development I don't think there's any question about that certainly not in this room and even across the industry as a whole that's a long way that we've come from when we started our first summit 14 years ago with over a million open source projects out there this unit this innovation aggregates into various community platforms and it finally culminates in commercial open source based open source developed products these products run many of the mission-critical applications in business today you've heard just a couple of those today here on stage but it's everywhere it's running the world today but to make customers successful with that interact innovation to run their real-world business applications these open source products have to be able to leverage increase increasingly complex infrastructure footprints we must also ensure a common base for the developer and ultimately the application no matter which footprint they choose as you heard mati say the developers want choice here no matter which no matter which footprint they are ultimately going to run their those applications on they want that flexibility from the data center to possibly any public cloud out there in regardless of whether that application was built yesterday or has been running the business for the last 10 years and was built on 10-year old technology this is the flexibility that developers require today but what does different infrastructure we may require different pieces of the technical stack in that deployment one example of this that Effects of many things as KVM which provides the foundation for many of those use cases that require virtualization KVM offers a level of consistency from a technical perspective but rel extends that consistency to add a level of commercial and ecosystem consistency for the application across all those footprints this is very important in the enterprise but while rel and KVM formed the foundation other technologies are needed to really satisfy the functions on these different footprints traditional virtualization has requirements that are satisfied by projects like overt and products like Rev traditional traditional private cloud implementations has requirements that are satisfied on projects like OpenStack and products like Red Hat OpenStack platform and as applications begin to become more container based we are seeing many requirements driven driven natively into containers the same Linux in different forms provides this common base across these four footprints this level of compatible compatibility is critical to operators who must best utilize the infinite must better utilize secure and deploy the infrastructure that they have and they're responsible for developers on the other hand they care most about having a platform that can creates that consistency for their applications they care about their services and the services that they need to consume within those applications and they don't want limitations on where they run they want service but they want it anywhere not necessarily just from Amazon they want integration between applications no matter where they run they still want to run their Java EE now named Jakarta EE apps and bring those applications forward into containers and micro services they need able to orchestrate these frameworks and many more across all these different footprints in a consistent secure fashion this creates natural tension between development and operations frankly customers amplify this tension with organizational boundaries that are holdover from the UNIX era of computing it's really the job of our platforms to seamlessly remove these boundaries and it's the it's the goal of RedHat to seamlessly get you from the old world to the new world we're gonna show you a really cool demo demonstration now we're gonna show you how you can automate this transition first we're gonna take a Windows virtual machine from a traditional VMware deployment we're gonna convert it into a KVM based virtual machine running in a container all under the kubernetes umbrella this makes virtual machines more access more accessible to the developer this will accelerate the transformation of those virtual machines into cloud native container based form well we will work this prot we will worked as capability over the product line in the coming releases so we can strike the balance of enabling our developers to move in this direction we want to be able to do this while enabling mission-critical operations to still do their job so let's bring Byrne his team back up to show you this in action for one more thanks all right what Red Hat we recognized that large organizations large enterprises have a substantial investment and legacy virtualization technology and this is holding you back you have thousands of virtual machines that need to be modernized so what you're about to see next okay it's something very special with me here on stage we have James Lebowski he's gonna be walking us through he's represents our operations folks and he's gonna be walking us through a mass migration but also is Itamar Hine who's our lead developer of a very special application and he's gonna be modernizing container izing and optimizing our application all right so let's get started James thanks burr yeah so as you can see I have a typical VMware environment here I'm in the vSphere client I've got a number of virtual machines a handful of them that make up my one of my applications for my development environment in this case and what I want to do is migrate those over to a KVM based right at virtualization environment so what I'm gonna do is I'm gonna go to cloud forms our cloud management platform that's our first step and you know cloud forms actually already has discovered both my rev environment and my vSphere environment and understands the compute network and storage there so you'll notice one of the capabilities we built is this new capability called migrations and underneath here I could begin to there's two steps and the first thing I need to do is start to create my infrastructure mappings what this will allow me to do is map my compute networking storage between vSphere and Rev so cloud forms understands how those relate let's go ahead and create an infrastructure mapping I'll call that summit infrastructure mapping and then I'm gonna begin to map my two environments first the compute so the clusters here next the data stores so those virtual machines happen to live on datastore - in vSphere and I'll target them a datastore data to inside of my revenue Arman and finally my networks those live on network 100 so I'll map those from vSphere to rover so once my infrastructure is map the next step I need to do is actually begin to create a plan to migrate those virtual machines so I'll continue to the plan wizard here I'll select the infrastructure mapping I just created and I'll select migrate my development environment from those virtual machines to Rev and then I need to import a CSV file the CSV file is going to contain a list of all the virtual machines that I want to migrate that were there and that's it once I hit create what's going to happen cloud forms is going to begin in an automated fashion shutting down those virtual machines begin converting them taking care of all the minutia that you'd have to do manually it's gonna do that all automatically for me so I don't have to worry about all those manual interactions and no longer do I have to go manually shut them down but it's going to take care of that all for me you can see the migrations kicked off here this is the I've got the my VMs are migrating here and if I go back to the screen here you can see that we're gonna start seeing those shutdown okay awesome but as people want to know more information about this how would they dive deeper into this technology later this week yeah it's a great question so we have a workload portability session in the hybrid cloud on Wednesday if you want to see a presentation that deep dives into this topic and how some of the methodologies to migrate and then on Thursday we actually have a hands-on lab it's the IT optimization VM migration lab that you can check out and as you can see those are shutting down here yeah we see a powering off right now that's fantastic absolutely so if I go back now that's gonna take a while you got to convert all the disks and move them over but we'll notice is previously I had already run one migration of a single application that was a Windows virtual machine running and if I browse over to Red Hat virtualization I can see on the dashboard here I could browse to virtual machines I have migrated that Windows virtual machine and if I open up a tab I can now browse to my Windows virtual machine which is running our wingtip toy store application our sample application here and now my VM has been moved over from Rev to Vita from VMware to Rev and is available for Itamar all right great available to our developers all right Itamar what are you gonna do for us here well James it's great that you can save cost by moving from VMware to reddit virtualization but I want to containerize our application and with container native virtualization I can run my virtual machine on OpenShift like any other container using Huebert a kubernetes operator to run and manage virtual machines let's look at the open ship service catalog you can see we have a new virtualization section here we can import KVM or VMware virtual machines or if there are already loaded we can create new instances of them for the developer to work with just need to give named CPU memory we can do other virtualization parameters and create our virtual machines now let's see how this looks like in the openshift console the cool thing about KVM is virtual machines are just Linux processes so they can act and behave like other open shipped applications we build in more than a decade of virtualization experience with KVM reddit virtualization and OpenStack and can now benefit from kubernetes and open shift to manage and orchestrate our virtual machines since we know this virtual machine this container is actually a virtual machine we can do virtual machine stuff with it like shutdown reboot or open a remote desktop session to it but we can also see this is just a container like any other container in openshift and even though the web application is running inside a Windows virtual machine the developer can still use open shift mechanisms like services and routes let's browse our web application using the OpenShift service it's the same wingtip toys application but this time the virtual machine is running on open shift but we're not done we want to containerize our application since it's a Windows virtual machine we can open a remote desktop session to it we see we have here Visual Studio and an asp.net application let's start container izing by moving the Microsoft sequel server database from running inside the Windows virtual machine to running on Red Hat Enterprise Linux as an open shipped container we'll go back to the open shipped Service Catalog this time we'll go to the database section and just as easily we'll create a sequel server container just need to accept the EULA provide password and choose the Edition we want and create a database and again we can see the sequel server is just another container running on OpenShift now let's take let's find the connection details for our database to keep this simple we'll take the IP address of our database service go back to the web application to visual studio update the IP address in the connection string publish our application and go back to browse it through OpenShift fortunately for us the user experience team heard we're modernizing our application so they pitched in and pushed new icons to use with our containerized database to also modernize the look and feel it's still the same wingtip toys application it's running in a virtual machine on openshift but it's now using a containerized database to recap we saw that we can run virtual machines natively on openshift like any other container based application modernize and mesh them together we containerize the database but we can use the same approach to containerize any part of our application so some items here to deserve repeating one thing you saw is Red Hat Enterprise Linux burning sequel server in a container on open shift and you also saw Windows VM where the dotnet native application also running inside of open ships so tell us what's special about that that seems pretty crazy what you did there exactly burr if we take a look under the hood we can use the kubernetes commands to see the list of our containers in this case the sequel server and the virtual machine containers but since Q Bert is a kubernetes operator we can actually use kubernetes commands like cube Cpl to list our virtual machines and manage our virtual machines like any other entity in kubernetes I love that so there's your crew meta gem oh we can see the kind says virtual machine that is totally awesome now people here are gonna be very excited about what they just saw we're gonna get more information and when will this be coming well you know what can they do to dive in this will be available as part of reddit Cloud suite in tech preview later this year but we are looking for early adopters now so give us a call also come check our deep dive session introducing container native virtualization Thursday 2:00 p.m. awesome that is so incredible so we went from the old to the new from the close to the open the Red Hat way you're gonna be seeing more from our demonstration team that's coming Thursday at 8 a.m. do not be late if you like what you saw this today you're gonna see a lot more of that going forward so we got some really special things in store for you so at this point thank you so much in tomorrow thank you so much you guys are awesome yeah now we have one more special guest a very early adopter of Red Hat Enterprise Linux we've had over a 12-year partnership and relationship with this organization they've been a steadfast Linux and middleware customer for many many years now please extend a warm welcome to Raj China from the Royal Bank of Canada thank you thank you it's great to be here RBC is a large global full-service is back we have the largest bank in Canada top 10 global operate in 30 countries and run five key business segments personal commercial banking investor in Treasury services capital markets wealth management and insurance but honestly unless you're in the banking segment those five business segments that I just mentioned may not mean a lot to you but what you might appreciate is the fact that we've been around in business for over 150 years we started our digital transformation journey about four years ago and we are focused on new and innovative technologies that will help deliver the capabilities and lifestyle our clients are looking for we have a very simple vision and we often refer to it as the digitally enabled bank of the future but as you can appreciate transforming a hundred fifty year old Bank is not easy it certainly does not happen overnight to that end we had a clear unwavering vision a very strong innovation agenda and most importantly a focus towards a flawless execution today in banking business strategy and IT strategy are one in the same they are not two separate things we believe that in order to be the number one bank we have to have the number one tactic there is no question that most of today's innovations happens in the open source community RBC relies on RedHat as a key partner to help us consume these open source innovations in a manner that it meets our enterprise needs RBC was an early adopter of Linux we operate one of the largest footprints of rel in Canada same with tables we had tremendous success in driving cost out of infrastructure by partnering with rahat while at the same time delivering a world-class hosting service to your business over our 12 year partnership Red Hat has proven that they have mastered the art of working closely with the upstream open source community understanding the needs of an enterprise like us in delivering these open source innovations in a manner that we can consume and build upon we are working with red hat to help increase our agility and better leverage public and private cloud offerings we adopted virtualization ansible and containers and are excited about continuing our partnership with Red Hat in this journey throughout this journey we simply cannot replace everything we've had from the past we have to bring forward these investments of the past and improve upon them with new and emerging technologies it is about utilizing emerging technologies but at the same time focusing on the business outcome the business outcome for us is serving our clients and delivering the information that they are looking for whenever they need it and in whatever form factor they're looking for but technology improvements alone are simply not sufficient to do a digital transformation creating the right culture of change and adopting new methodologies is key we introduced agile and DevOps which has boosted the number of adult projects at RBC and increase the frequency at which we do new releases to our mobile app as a matter of fact these methodologies have enabled us to deliver apps over 20x faster than before the other point about around culture that I wanted to mention was we wanted to build an engineering culture an engineering culture is one which rewards curiosity trying new things investing in new technologies and being a leader not necessarily a follower Red Hat has been a critical partner in our journey to date as we adopt elements of open source culture in engineering culture what you seen today about red hearts focus on new technology innovations while never losing sight of helping you bring forward the investments you've already made in the past is something that makes Red Hat unique we are excited to see red arts investment in leadership in open source technologies to help bring the potential of these amazing things together thank you that's great the thing you know seeing going from the old world to the new with automation so you know the things you've seen demonstrated today they're they're they're more sophisticated than any one company could ever have done on their own certainly not by using a proprietary development model because of this it's really easy to see why open source has become the center of gravity for enterprise computing today with all the progress open-source has made we're constantly looking for new ways of accelerating that into our products so we can take that into the enterprise with customers like these that you've met what you've met today now we recently made in addition to the Red Hat family we brought in core OS to the Red Hat family and you know adding core OS has really been our latest move to accelerate that innovation into our products this will help the adoption of open shift container platform even deeper into the enterprise and as we did with the Linux core platform in 2002 this is just exactly what we did with with Linux back then today we're announcing some exciting new technology directions first we'll integrate the benefits of automated operations so for example you'll see dramatic improvements in the automated intelligence about the state of your clusters in OpenShift with the core OS additions also as part of open shift will include a new variant of rel called Red Hat core OS maintaining the consistency of rel farhat for the operation side of the house while allowing for a consumption of over-the-air updates from the kernel to kubernetes later today you'll hear how we are extending automated operations beyond customers and even out to partners all of this starting with the next release of open shift in July now all of this of course will continue in an upstream open source innovation model that includes continuing container linux for the community users today while also evolving the commercial products to bring that innovation out to the enterprise this this combination is really defining the platform of the future everything we've done for the last 16 years since we first brought rel to the commercial market because get has been to get us just to this point hybrid cloud computing is now being deployed multiple times in enterprises every single day all powered by the open source model and powered by the open source model we will continue to redefine the software industry forever no in 2002 with all of you we made Linux the choice for enterprise computing this changed the innovation model forever and I started the session today talking about our prediction of seven years ago on the future being open we've all seen so much happen in those in those seven years we at Red Hat have celebrated our 25th anniversary including 16 years of rel and the enterprise it's now 2018 open hybrid cloud is not only a reality but it is the driving model in enterprise computing today and this hybrid cloud world would not even be possible without Linux as a platform in the open source development model a build around it and while we have think we may have accomplished a lot in that time and we may think we have changed the world a lot we have but I'm telling you the best is yet to come now that Linux and open source software is firmly driving that innovation in the enterprise what we've accomplished today and up till now has just set the stage for us together to change the world once again and just as we did with rel more than 15 years ago with our partners we will make hybrid cloud the default in the enterprise and I will take that bet every single day have a great show and have fun watching the future of computing unfold right in front of your eyes see you later [Applause] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] anytime [Music]

>> Announcer: Live from Austin, Texas, It's The Cube. Covering KubeCon 2017 and CloudNativeCon 2017. Brought to you by Red Hat, The Lennox Foundation, and The Cube's ecosystem partners. >> Okay, welcome back everyone. Live here in Austin, Texas, this is The Cube's exclusive coverage of the CNCF CloudNativeCon which was yesterday, and today is KubeCon, for Kubernetes conference, and a little bit tomorrow as well, some sessions. Our next guest is Adrian Cockcroft, VP of Cloud Architecture Strategy at AWS, Amazon Web Services, and my co-host Stu Miniman. Obviously, Adrian, an industry legend on Twitter and the industry, formerly with Netflix, knows a lot about AWS, now VP of Cloud Architecture, thanks for joining us. Appreciate it. >> Thanks very much. >> This is your first time as an AWS employee on The Cube. You've been verified. >> I've been on The Cube before. >> Many times. You've been verified. What's going on now with you guys, obviously coming off a hugely successful reinvent, there's a ton of video of me ranting and raving about how you guys are winning, and there's no second place, in the rear-view mirror, certainly Amazon's doing great. But CloudNative's got the formula, here. This is a cultural shift. What is going on here that's similar to what you guys are doing architecturally, why are you guys here, are you evangelizing, are you recruiting, are you proposing anything? What's the story? >> Yeah, it's really all of those things. We've been doing CloudNative for a long time, and the key thing with AWS, we always listen to our customers, and go wherever they take us. That's a big piece of the way we've always managed to keep on top of everything. And in this case, the whole container industry, there's a whole whole market there, there's a lot of different pieces, we've been working on that for a long time, and we found more and more people interested in CNCF and Kubernetes, and really started to engage. Part of my role is to host the open source team that does outbound engagement with all the different open source communities. So I've hired a few people, I hired Arun Gupta, who's very active in CNCF earlier this year, and internally we were looking at, we need to join CNCF at some point. We got to do that eventually and venture in, let's go make it happen. So last summer we just did all the internal paperwork, and running around talking to people and got everyone on the same page. And then in August we announced, hey, we're joining. So we got that done. I'm on the board of CNCF, Arun's my alternate for the board and technical, running around, and really deeply involved in as much of the technology and everything. And then that was largely so that we could kind of get our contributions from engineering on a clear footing. We were starting to contribute to Kupernetes, like as an outsider to the whole thing. So that's why we're, what's going on here? So getting that in place was like the basis for getting the contributions in place, we start hiring, we get the teams in place, and then getting our ducks in a row, if you like. And then last week at Reinvent, we announced EKS, the EC2 Kubernete's Service. And this week, we all had to be here. Like last week after Reinvent, everyone at AWS wants to go and sleep for a week. But no, we're going to go to Austin, we're going to do this. So we have about 20 people here, we came in, I did a little keynote yesterday. I could talk through the different topics, there, but fundamentally we wanted to be here where we've got the engineering teams here, we've got the engineering managers, they're in full-on hiring mode, because we've got the basic teams in place, but there's a lot more we want to do, and we're just going out and engaging, really getting to know the customers in detail. So that's really what drives it. Customer interactions, little bit of hiring, and just being present in this community. >> Adrian, you're very well known in the open source community, everything that you've done. Netflix, when you were on the VC side, you evangelized a bunch of it, if I can use the term. Amazon, many of us from the outside looked and, trying to understand. Obviously Amazon used lots of open source, Amazon's participated in a number of open source. MXNet got a lot of attention, joining the CNCF is something, I know this community, it's been very positively received, everybody's been waiting for it. What can you tell us about how Amazon, how do they think about open source? Is that something that fits into the strategy, or is it a tactic? Obviously, you're building out your teams, that sends certain signals to market, but can you help clarify for those of us that are watching what Amazon thinks about when it comes to this space? >> I think we've been, so, we didn't really have a team focused on outbound communication of what we were doing in open source until I started building this team a year ago. I think that was the missing link. We were actually doing a lot more than most people realized. I'd summarize it as saying, we were doing more than most people expected, but less than we probably could have been given the scale of what we are, the scale that AWS is at. So part of what we're doing is unlocking some internal demand where engineering teams were going. We'd like to open source something, we don't know how to engage with the communities. We're trying to build trust with these communities, and I've hired a team, I've got several people now, who are mostly from the open source community, we were also was kind of interviewing people like crazy. That was our sourcing for this team. So we get these people in and then we kind of say, all right, we have somebody that understands how to build these communities, how to respond, how to engage with the open source community. It's a little different to a standard customer, enterprise, start up, those are different entities that you'd want to relate to. But from a customer point of view, being customer-obsessed as AWS is, how do we get AWS to listen to an open source community and work with them, and meet all their concerns. So we've been, I think, doing a better job of that now we've pretty much got the team in place. >> That's your point, is customer focus is the ethos there. The communities are your customers in this case. So you're formalizing, you're formalizing that for Amazon, which has been so busy building out, and contributing here and there, so it sounds like there was a lot of activity going on within AWS, it was just kind of like contributing, but so much work on building out cloud ... >> Well there's a lot going on, but if no one was out there telling the story, you didn't know about it. Actually one of the best analogies we have for the EKS is actually our EMR, our Hadoop service, which launched 2010 or something, 2009, we've had it forever. But from the first few years when we did EMR, it was actually in a fork. We kept just sort of building our own version of it to do things, but about three or four years ago, we started upstreaming everything, and it's a completely clean, upstreamed version of all the Hadoop and all the related projects. But you make one API call, a cluster appears. Hey, give me a Hadoop cluster. Voom, and I want Spark and I want all these other things on it. And we're basically taking Kubernetes, it's very similar, we're going to reduce that to a single API call, a cluster appears, and it's a fully upstreamed experience. So that's, in terms of an engineering relationship to open source, we've already got a pretty good success story that nobody really knew about. And we're following a very similar path. >> Adrian, can you help us kind of unpack the Amazon Kubernetes stack a little bit? One of the announcements had a lot of attention, definitely got our attention, Fargate, kind of sits underneath what Kubernetes is doing, my understanding. Where are you sitting with the service measures, kind of bring us through the Amazon stack. What does Amazon do on its own versus the open source, and how those all fit together. >> Yeah, so everyone knows Amazon is a place where you can get virtual machines. It's easy to get me a virtual machine from ten years ago, everyone gets that, right? And then about three years ago, I think it was three years ago, we announced Lambda - was that two or three years ago? I lose track of how many reinvents ago it was. But with Lambda it's like, well, just give me a function. But as a first class entity, there's a, give me a function, here's the code I want you to run. We've now added two new ways that you can deploy to, two things you can deploy to. One of them's bare metal, which is already announced, one of the many, many, many announcements last week that might have slipped by without you noticing, but Bare Metal is a service. People go, 'those machines are really big'. Yes, of course they're really big! You get the whole machine and you can be able to bring your own virtualization or run whatever you want. But you could launch, you could run Kubernetes on that if you wanted, but we don't really care what you run it on. So we had Bare Metal, and then we have container. So Fargate is container as a first class entity that you deploy to. So here's my container registry, point you at it, and run one of these for me. And you don't have to think about deploying the underlying machines it's running on, you don't have to think about what version of Lennox it is, you have to build an AMI, all of the agents and fussing around, and you can get it in much smaller chunks. So you can say you get a CPU and half a gig of ram, and have that as just a small container. So it becomes much more granular, and you can get a broader range of mixes. A lot of our instances are sort of powers of two of a ratio of CPU to memory, and with Fargate you can ask for a much broader ratio. So you can have more CPU, less memory, and go back the other way, as well. 'Cause we can mix it up more easily at the container level. So it gives you a lot more flexibility, and if you buy into this, basically you'll get to do a lot of cost reduction for the sort of smaller scale things that you're running. Maybe test environments, you could shrink them down to just the containers and not have a lot of wasted space where you're trying to, you have too many instances running that you want to put it in. So it's partly the finer grain giving you more ability to say -- >> John: Or consumption choice. >> Yeah, and the other thing that we did recently was move to per-second billing, after the first minute, it's per-second. So the granularity of Cloud is now getting to be extremely fine-grained, and Lambda is per hundred millisecond, so it's just a little bit -- >> $4.03 for your bill, I mean this is the key thing. You guys have simplified the consumption experience. Bare Metal, VM's, containers, and functions. I mean pick one. >> Or pick all of them, it's fine. And when you look at the way Fargate's deployed in ECS it's a mixture. It's not all one or all the other, you deploy a number of instances with your containers on them, plus Fargate to deploy some additional containers that maybe didn't fit those instances. Maybe you've got a fleet of GPU enhanced machines, but you want to run a bit of Logic around it, some other containers in the same execution environment, but these don't need to be on the GPU. That kind of thing, you can mix it up. The other part of the question was, so how does this play into Kubernetes, and the discussions are just that we had to release the thing first, and then we can start talking, okay, how does this fit. Parts of the model fit into Kubernetes, parts don't. So we have to expose some more functionality in Fargate for this to make sense, 'cause we've got a really minimal initial release right now, we're going to expose it and add some more features. And then we possibly have to look at ways that we mutate Kubernetes a little bit for it to fit. So the initial EKS release won't include Fargate, because we're just trying to get it out based on what everyone knows today, we'd rather get that out earlier. But we'll be doing development work in the meantime, so a subsequent release we'll have done the integration work, which will all happen in public, in discussion with the community, and we'll have a debate about, okay, this is the features Fargate needs to properly integrate into Kubernetes, and there are other similar services from other top providers that want to integrate to the same API. So it's all going to be done as a public development, how we architect this. >> I saw a tweet here, I want to hear your comments on, it's from your keynote, someone retweeted, "managing over 100,000 clusters on ACS, hashtag Fargate," integrated into ECS, your hashtag, open, ADM's open. What is that hundred thousand number. Is that the total number, is that an example? On elastic container service, what does that mean? >> So ECS is a very large scale, multi-tenant container operation service that we've had for several years. It's in production, if you compare it to Kubernetes it's running much larger clusters, and it's been running at production-grade for longer. So it's a little bit more robust and secure and all those kinds of things. So I think it's missing some Kubernetes features, and there's a few places where we want to bring in capabilities from Kubernetes and make ECS a better experience for people. Think of Kubernetes as some what optimized for the developer experience, and ECS for more the operations experience, and we're trying to bring all this together. It is operating over a hundred thousand clusters of containers, over a hundred thousand clusters. And I think the other number was hundreds of millions of new containers are launched every week, or something like that. I think it was hundreds of millions a week. So, it's a very large scale system that is already deployed, and we're running some extremely large customers on, like Expedia and Macbook. Macbook ... Mac Box. Some of these people are running tens of thousands of containers in production as a single, we have single clusters in the tens of thousands range. So it's a different beast, right? And it meets a certain need, and we're going to evolve it forwards, and Kubernetes is serving a very different purpose. If you look at our data science space, if you want exactly the same Hadoop thing, you can get that on prem, you can run EMR. But we have Athena and Red Shift and all these other ways that are more native to the way we think, where we can go iterate and build something very specific to AWS, so you blend these two together and it depends on what you're trying to achieve. >> Well Adrian, congratulations on a great opportunity, I think the world is excited to have you in your role, if you could clarify and just put the narrative around, what's actually happening in AWS, what's been happening, and what you guys are going to do forward. I'll give you the last minute to let folks know what your job is, what your objective is, what you're looking for to hire, and your philosophy in the open source for AWS. >> I think there's a couple of other projects, and we've talked, this is really all about containers. The other two key project areas that we've been looking at are deep learning frameworks, since all of the deep learning frameworks are open source. A lot of Kubernetes people are using it to run GPUs and do that kind of stuff. So Apache MXNet is another focus on my team. It went into the incubation phase last January, we're walking it through, helping it on its way. It's something where we're 30, 40% of that project is AWS contribution. So we're not dominating it, but we're one of its main sponsors, and we're working with other companies. There's joint work with, it's lots of open source projects around here. We're working with Microsoft on Gluon, we're working with Facebook and Microsoft on Onyx which is an open URL network exchange. There's a whole lot of things going on here. And I have somebody on my team who hasn't started yet, can't tell you who it is, but they're starting pretty soon, who's going to be focusing on that open source, deep learning AI space. And the final area I think is interesting is IOT, serverless, Edge, that whole space. One announcement recently is free AltOS. So again, we sort of acquired the founder of this thing, this free real-time operating system. Everything you have, you probably personally own hundreds of instances of this without knowing it, it's in everything. Just about every little thing that sits there, that runs itself, every light bulb, probably, in your house that has a processor in it, those are all free AltOS. So it's incredibly pervasive, and we did an open source announcement last week where we switched its license to be a pure MIT license, to be more friendly for the community, and announced an Amazon version of it with better Amazon integration, but also some upgrades to the open source version. So, again, we're pushing an open source platform, strategy, in the embedded and IOT space as well. >> And enabling people to build great software, take the software engineering hassles out for the application developers, while giving the software engineers more engineering opportunities to create some good stuff. Thanks for coming on The Cube and congratulations on your continued success, and looking forward to following up on the Amazon Web Services open source collaboration, contribution, and of course, innovation. The Cube doing it's part here with its open source content, three days of coverage of CloudNativeCon and KubeCon. It's our second day, I'm John Furrier, Stu Miniman, we'll be back with more live coverage in Austin, Texas, after this short break. >> Offscreen: Thank you.

>> Announcer: Live from Las Vegas, it's The Cube, covering AWS re:Invent 2017 presented by AWS, Intel, and our ecosystem of partners. >> Hey, welcome back everyone. Live here in Las Vegas, the Cube is covering exclusively the AWS re:Invent. We've got two sets. This is set one, set two behind me. We're here with a startup called Zettabytes, Rishi Yadav, Cube Alumni CEO, and Sudhir Janir, CTO. Hot new start-up, Zettabytes. Formerly, you're an entrepreneur, your other company's still going, Info Objects. Welcome back. >> Thanks for having us here. I dont know it's the seventh time, eighth time? I mean, we love Cube guys. Yes, so Info Objects is the mothership and doing really, really great, and today we are launching Zettabytes, which is our hybrid cloud, cloud integration platform. We are starting with AWS, and then it's going to have integration for the clouds. >> So start-ups are impacted, and we were talking yesterday about kind of a demarcation line between a point in time. I say 2012, maybe you can say 2014, if you were born before 2012 or 2014, you probably didn't factor the cloud as large scale as it is. But after that day, you're a new born start-up, you look at the cloud as a resource, an opportunity, so what's your perspective as an entrepreneur, a serial entrepreneur, you start a company, you look at the big beast in Amazon, opportunity, challenge, what's your view? >> So actually 2014 was an inflection point for two things. Number one is that the big data, big data, it started with the hyper scale companies, and at that time, you're talking about Facebook, and Yahoo and other places, but it was not enterprise-ready. And we suddenly saw the option. John, you have been following the big data directly from the, I think the cloud data basement days, right? So in 2014 it got a better option. And the things like security and governance, which were offered not much concern earlier, it became front and center. Another thing which happened was around 2014, 2015, timeframe, the public cloud, which were for eight, nine years, essentially AWS, that was about 70 start-ups about saving money for them. That also started getting an option, and the enterprise, and when you're talking about enterprise, there you cannot tell them that if you deploy 10 servers on AWS, it's going to save you $200,000. They would say you already have $500 million spent. We have these huge data centers, so they needed some more value than that. >> How about your company Zettabytes, so you're launching a new company, what is it, what does it do, why are you starting it? Take a minute to explain what you're doing. >> Yes, absolutely. So the Zettabytes idea came from this convergence of the big data, public cloud and IOT. And market is ripe for it, and the challenge was that we talked to a lot of customers, a lot of them have already started working in the cloud, and some of them were planning to start the journey in the cloud, and the challenge was that at the same time they also wanted to build a big data link, Andy talked about it a lot today, right, assuming the largest big data lake. So now the question was that do you really want to go the old school route in which you are using Hadoup and other services around it, and then you do lift and shift to AWS? And then you transform to PAS. So you spend one and a half, two years in doing Hadoup, and then you spend another one and a half, two years, doing the PAZ, that cloud-native transformation in a better way. And then realize that whether the clients are on AWS today, or they are going to be in one year, they need the same experience, the same cloud experience, the same AWS experience which they have on their AWS, they want on-prem. Now that includes the other cloud-native APIs, but also the agility and everything else. >> So let met ask Sudhir a question. So you're the CTO. I know you're technical too, so I have both of you. So the old days, I'm a developer, I have my local host, I'm banging away code, and then I go, okay I'm done. And I say, ship to the server for QA or whatever. And even the cloud. Businesses want that same kind of functionality on premise. They want to go to the cloud, so all the developers are changing, they want that local host like feel. They don't wanna have to write code, ship it to a server, put it through the cloud, they just want instant integration to Amazon. Is that what you're doing? >> Yeah. >> Did I get it right? 'Cause that seems what I think you're doing. >> Yes, you develop that seamless experience. So you have the same set of APIs, which you normally would do on AWS, so still use the same data, still use the same data blue CLI. Use all data blue APIs, we're accepted those APIs on this platform, build a good base, based on those APIs, now using Kubernetes, you decide where this workload will go. >> So one of the challenges of AWS though is that they release services like constantly. I think we had the announcer at the keynote today, it was like another hundred or so services that they were releasing. So how do you choose which ones? Do you support all of them, or do you focus on specific ones? >> No, first we are focusing on a few specific ones, which are mostly being used. We are starting with Lexi, for example, as three. Lamda, Kenesis, Kafka, and this bargain is DFS are there from day one also. And all of these are Lexi, we are doing Lexi, today official announcement, they have launched Kubernetes Now. Container management service. We have that flexibility from day one only. So we have that in our outlines, and using that, even for example, your workload says, some of the piece should run on that, on Lexi, on permalines. Some of the P should go to the cloud, that is also possible. >> So you're selling an appliance. >> Yeah, yeah. The one million Lexi, or Kubernetes million might run on the AWS, few of the menus might run on your uplines, you can easily Lexi's do the all the container management. >> This is model, they pay for the box, or is it a service? Or they get the box as part of a service? What's the business model? >> So we do both, so it's a (mumbles) format, as well as an appliance, so the beauty of appliances is that everything is already optimized for you, so that makes it very easy. But if a customer has a chosen hardware platform, and we can definitely deploy it on that also. And adding to the hunter services thing, I think that's a great point, that AWS has so many services now that can you really go and figure out which services are most optimized for your needs? So that's where you need a partner on prem-site, and that's what we are going to be, and another thing as Sudhir mentioned, the EKS which they announced today, Kubernetes, so you have Kubernetes on-prem, AWS is supporting Kubernetes, and we are also supporting Kubernetes, so if you want closer to that level, it's completely seamless. >> And you were saying before, your target is enterprise has been good, so the appliance delivery model and the simplicity of being able to manage a lot of different services. Clearly being able to manage things at scale is something that enterprisers are crying out for because otherwise I have to, AWS is great, if you wanna hand build everything yourself, it has all of those components that you can assemble like Lego, but if I'm an enterprise, I want to be able to do that at scale. Humans don't scale very well, so I need some technology to help with that. So it sounds like you are actually providing the leverage to get enterprise humans to be able to manage AWS. Is that a fair characterization? >> Absolutely, that is definitely a very important aspect of it, and another aspect of it is that if you do not want to have some workloads on AWS for one thing or another. IOT workloads by definition cannot be on AWS. Low intensive workloads. They cannot be on AWS. In the same way the workloads in which you need some actual level of security. So within your data center, as much as beat down the data center piece, you have your own security and governance. And you can do that, and that's coming back to your question that are we going to support all hundred services, yes, but the local execution we have only going to provide for some services, which by their very nature make more sense to learn on-prem. >> Yeah, keep the core services. >> Rishi: Core services. >> All right so how do you guys gonna sell this product, take us through the start-up situation, you're here, are you talking to customers? Why are they are buy you? What's the conversations like? When do they need you? Take us through your conversations here at re:Invent. >> Yeah, so before that, the AWS has been super successful for the green field applications. The new applications, the applications which are born in the cloud, but when it comes to transforming the existing application it becomes a big, big challenge. So a lot of customers are coming to us, they are interested in how I can seamlessly transform their-- >> John: What's an example workload? >> So the example workloads for us is going to be the big data workloads. Which we have specialized in for last so many years. So one of them can IOT. Sudhir, probably you can explain what that is. >> So that example could be for example from today's keynote, if you see Expedia case, or Lexi Goldman Sachs case, they spend a lot of time in converting their code to the AWS specific-word, right? Millions of lines, or billions of lines of code. What we are doing today, if you dealing with the application, tomorrow it could be future ready for AWS. It's more convenience, we are actually modeling your experience with AWS. >> So it's making for enterprisers to make that transition from what they're doing today across the cloud, because that's a big deal for them. >> Tomorrow when you are Lexi, then you go to AWS, your data will decide whether you want to earn your workload on our plans, or AWS. >> Okay, so your market is hybrid cloud, basically. People doing hybrid cloud should talk to you guys. >> Yeah, and code would be future proof. What you you are you developing today-- >> John: All right so is the product shipping? >> Yes, so we are in the early beta stage, we already have five beta customers. And the product is going to be ready in a week's time. >> So data now. >> Yeah, yes. >> Yeah, these guys are ready already. >> Open beta, restricted beta? >> It is going to be restricted beta for now. Then it's going to be open beta, so yes, we are going to five more customers in the next two months for the beta. >> Take a minute to explain the type of customer you're looking for. Are they all field spots, any more, you have five more spots, you said? >> Yeah, we have five more spots for the beta. >> John: Who are yo looking for out there? >> Any large enterprise which is planning to move to AWS, but are struggling with all the nitty gritties, looking at the hundred services, and how do you integrate your existing applications there. So how you could take baby steps, like so we are going to not just take that baby steps, but sprint through it, so that's what Zettabytes plans is for. >> Rishi, congratulations on the new start-up, launching here, Zettabytes, open beta, five more spots left. Check 'em out, Zettabytes, if you're doing hybrid cloud or true private cloud, they have five spots available. It's The Cube, bringing all the action, the start-up action here and also the conversations at re:Invent. I'm John Furrier, Justin Warren. We're back with more after this short break. (electronic jingle)

>> Announcer: Live from Las Vegas, it's theCUBE. Covering AWS Reinvent 2017, presented by AWS, intel, and our ecosystem of partners. >> Welcome back to theCUBE's continuing coverage of AWS Reinvent 2017. This is day two for us. Incredible day one. We had great buzz on day two. Great announcements coming out from AWS today. I'm Lisa Martin with my cohost Keith Townsend, and we're excited to be joined by CUBE alumni, Aaron Kalb, the head of product and a founder of Alation. Welcome back to the show. >> Thanks so much for having me. I'm excited to be here. >> So speaking of excitement, you can hear the buzz behind us. Interesting about Alation, the first data catalog designed for human collaboration. What gap did Alation see in the market five years ago when you started? >> That's a great question, Lisa. So, yeah, we're the first data catalog, period, and we're excited to see a lot of other people kind of using that label, I believe it validates this as a space, and I think that everybody needs, and I think our approach, as you said, was to really to approach it from the human side, to say the data might be generated by machines or stored on machines, but it's not meant to ultimately be consumed by machines. Even if there's algorithms that's pulling it in, it's to ultimately serve human interests. So the goal was to design from the human back and really think, what does this data mean? Can I trust it? Is it gonna drive the processes correctly? >> So Aaron, I have seen that term quite a bit, and data catalog, for me, means one specific thing. Can you kind of wrap that up for us? >> What is a data catalog? >> That's a really great question, Keith, and I think what's interesting is we took a lot of inspiration in the early days actually from Amazon.com, right? So Amazon is an amazing modern product catalog. You can go in, type in English and see a variety of products that match that keyword. And for each one you can see whose bought it before, how many stars did they give it? Is it good? So it helps you find, understand, and trust, and get the right product for your need. We want to do that same thing for data. How do you found a trustworthy data asset, understand what it is, and put it to use? So that's exactly the goal. >> So, a simple problem is I've worked with a ton of researchers in the Big Pharma industry, data across the world basically. And a lot of data sets, repetitive. A team in Germany is working with one set of data, team in New Jersey working with another one, how does your solution help those researchers find the data that they're looking for? >> Exactly right. So the problem is many different data sets, many different things claiming to be true. Some of them are just plain wrong. Sometimes the answer might be one thing in Germany but something else elsewhere, and they're both valid. And so you've hit the nail on the head. The way people use data contains a lot of hints about the way you should use data. So just like Amazon, again, because we're here. And it'll say, oh, customers who bought what you're about to buy also bought this, and that can help you discover something useful. We try to expose we call behavior IO. Let the past behavior of the most knowledgeable people in the organization drive the future behavior. That's a big part of what we do. So one of the things I was reading about you guys on your website and some editorials is, a lot of data lakes fail. Why is that? How is Alation different? >> That's a great question. So I think what's interesting about a data lake is it's kind of like having a huge basement, right? And it can make you adopt a hoarder mentality, you say, oh it's so cheap to store everything, we'll just store it, and then when we need it we'll figure it out then. Well, the truth is, it's not always how it goes. Often you store so many things, it's cheap to store it, but when that actual human who has an actual analytical question they want to answer or an actual business process they want to improve, goes looking for the data, all they see are all these unlabeled boxes. Right? So I think the key is to think about how do you make information searchable, discoverable, understandable, trustworthy? And what's great is a lot of people are migrating from their on-premise data lakes to the Clouds, and obviously (mumbles) a big leader in where that's going. It gives you an opportunity to ask, just like when you move houses to say, let me look at what I've got, and can I adopt an approach? You know, what do I actually need? You might keep it all, but what's gonna be in the top shelf? What's gonna be in the basement? And how do you make everything accessible? >> So Aaron, can you talk a little bit about today's announcements? A lot of machine learning, analytics announcements from AWS. However, I don't know what I already have. So how can I make use of that data? Can you help talk about how Alation helps to leverage some of these new tools from AWS? >> Absolutely. So, we've had a bunch of customers on AWS Stack already, and increasingly so. Fundamentally our customers are people who do analysis. A lot of them are using S3, Redshift, the like. And people are hosting on the Cloud increasingly. And it's exactly the problem you described. It's I know I have it somewhere, but I can't get my head around what I already have. What region is it in? >> Aaron: Exactly. >> Is it in a region, is it in my data center, where is it? >> Exactly. so whether that data is in Redshift, in S3, or somewhere else. Maybe it's, you know, in a Postgres or SQL Server or Oracle Server. (mumbles) hosted one. Whatever it is, we crawl and index everything you have, just the way Google crawls and indexes everything out on the web, and we make it searchable, and we put information about who's used it and how good it is front and center, just the way you can say, oh this is a five-star clock on Amazon, I'm gonna go click buy it now. >> So one challenge with data lakes is security around that data. So data catalog, I get meta data around the data that I have, but some of that data is sensitive. How do you guys handle security around the data catalog itself? >> Absolutely. So we respect all the security and privacy settings that exist that are on the data itself, and we just sort of surface those in the catalog. Some of our customers say, look, we want to let people know what exists so they can ask for permission. Others say, even having awareness of this data is too much for us. And you mentioned, Pharma, that'll vary by industry. >> Where do you guys get involved in the customer conversation? You said many customers of yours are already using AWS for different things, but where does Alation come into the conversation? Are you brought in by AWS? Are you brought in by customers? Where are they on this journey towards leveraging the Cloud for the things that they need, agility, the speed, and the cost reduction? >> Absolutely. So our promise is we help you find, understand, and trust your data wherever it lives and whoever you are, democratizing it. So customers choose the right infrastructure for their needs, given cost, given performance. Obviously Amazon is increasingly a part of that. But that's a choice they make, and we resolve to handle that wherever it is. And as of customers, our customers are so smart, we learn so much from them. We're meeting a bunch of CIOs, both the prospects and also talking some current customers like Expedia today here at AWS lunch with our investor Costanoa and another at dinner tonight. And folks like Chegg and Invoice2go who've been longstanding AWS customers using S3, using Redshift, and actually in Chegg's case, they have a lot of homegrown tooling that they developed on the backend, but they said Alation is the best place to surface that and have it be the central portal for business users and analysts who might not be able to otherwise access things that are just available via (mumbles) >> So how are you, Alation, and AWS helping a customer like Chegg extract ROI quickly? >> Yeah, it's a great question, so, AWS is really great for cost containment. You have all this data and all this processing, but you have peaks and you have troughs, and how do you make sure you're not overpaying (mumbles) so it's great for helping with storage and computation. And Alation helps with the human side, how do you get that upside by saying you have this data, that could effect the way you stock your shelves, the way you price your products or who you hire, what markets you go into. And that requires that last step. If you have the data but it isn't in the right hands at the right time or it's interpreted incorrectly, it has no value. So the two of them together (mumbles) end-to-end solution. >> So Aaron, with GDPR coming up quick, the enforcement of that coming up May 2018, customers have to be concerned about having data they shouldn't have. Does Alation help identify some of that data? >> Absolutely. So data catalog is fundamentally an inventory of everything you have, plus information about how it has been and could be consumed. We very much focus on the upside, potential of using that to drive better business choices and better analysis. But we have customers actually saying, oh, we can use that same information about what we have, who's using it, what's in it, to instead make sure that it's used compliantly with a regulation like GDPR to make sure that you aren't holding onto health records longer than you should or PII. And it's absolutely a very big use case for many of our customers. >> So data is touched by a lot of people in an organization. AWS has done a great job of really developing a lot of synergy with the developer community for a long time now. But we're also seeing some trends suggesting they're going up the stack. They want to get more enterprises, enterprises are at the precipice, as Andy Jassey said, of this mass migration to the Cloud. You mentioned, all of your work with AWS and the CIO events that you're having here. Where are you guys in a conversation with customers? Are you more now having to get to that C-suite as now their business are absolutely predicated upon the best use of data to identify ways to monetize new revenue streams. How influential is that C-level in this conversation. >> It's a great question. So I think what is interesting is, all companies, we sort of commoditized a basic business school, consultant, best practice knowledge. Everyone is kind of already doing that. To get to the next level our customers are recently telling us it is only by finding key insights in data that they're gonna beat out the competition and stay relevant. I mean, look what Amazon and Netflix have done to the industries that, they weren't as data driven, and have that kind of agility around data. So everybody wants to do the same thing. So CIOs, CDOs, chief data officers, we're seeing them crop up more and more and being more and more empowered in the organization. Because it's seen as central to hitting revenue targets and making an impact, which is what customers want to do. And I mentioned CISOs as well with the question that you asked, Keith, about security. >> The CISOs, the chief information security officers. >> Aaron: Yeah, absolutely. Yeah, absolutely, so I think usually often a CISO will report into a CIO, often you see it as adjacent to them, there's somebody who needs to have the confidence, as they do, in Alation's process of mirroring what's in the data source, not introducing security holes. Potentially even taking a step forward and saying, as I implement GDPR and other policies, how do I use a comprehensive automated inventory like Alations to make sure that process isn't just started but actually finished and avoid the fines and the adverse events. We absolutely see across the C-suite a lot of interest. >> So let's go one step below the CIO, and I think the CIO understands this. This data is the new oil. Very, very straightforward. But now you're getting into the enterprise architect, the VP of infrastructure, and they have to implement these technologies. What have been some of the rewards and challenges with those conversations? >> That's a great question. Right, so here at AWS Reinvent we have a very technical audience, very infrastructure minded. Those are folks that we love to engage with, but our primary audience is the business. >> Keith: Right. >> Right. And so I think what's interesting is, the problem we solve for the more infrastructure-minded executives is how do I deal with these business users? How do I turn this relationship that feels adversarial, where they're putting strain on my system, they're upset about cost overruns, we don't speak the same language with the same values. Alation can be a great bridge. Because we do all of this automated extraction and tying to the sources where they are, and kind of meet the industry people where they live, but then can communicate the value in a clean interface that demonstrates real business ROI to the business. So we can kid of be an ambassador between those sides of the customer. >> I love that, being an ambassador. Aaron, your passion for Alation, what you do, your engagement with customers is palpable. So we thank you for joining us on theCUBE, and wish you guys the best of luck with what you're doing here at AWS Reinvent. >> Lisa, thank you so much for having me. >> Lisa: Awesome. >> Keith: Great job, Aaron. >> Thank you for watching. We are live at AWS Reinvent 2017 with 42,000 other people. I'm Lisa Martin, for my cohost Keith Townsend and Aaron Kalb, stick around. We'll be right back.

(motivating electronic music) >> Hello everyone, welcome to theCUBE. I'm John Furrier, the co-host and co-founder of Silicon Angle Media. We're here for a CUBE Conversation in our studios in Palo Alto, California. Here with two great guests inside the industry, to help illuminate the cloud computing conversation, really around what's coming up with Amazon re:Invent. But more importantly, the major advances happening in the digital transformation around IT and around developers and around cloud, and how that's impacting business. Our guests are Chris Comings, who's with the Chasm Group, consult and they help people, and former industry executive at NetApp, and (mumbles) the storage company. Peter Smails, the CMO of Datos.io data, and then he's the CMO there. Now, new progressive solutions. So guys, great solution. And Peter, I know you got news. We're gonna do another segment on your big news coming out, so we're gonna hold that off. >> Cool. >> The game has changed, right? >> Mm-hmm (affirmative). >> And we talked, with Chris and I had a one on one about this. But the industry conversation, there's people that are in the know, and people who are trying to figure out what's happening and how it impacts their business. CIO, CEOs, CDOs, chief data officers, chief security officers. There's a lot of things on the plate of businesses. >> Right. >> Big time. >> Right. >> So let's unpack this, and let's illuminate what it means. So cloud computing, Peter, what's your take on this, because Datos just takes a unique approach? I love your solution. A lot of people are liking this solution, but it's nuanced, because it's cloud-- >> Yeah. >> That's driving you. >> Yeah. >> What's the big driver? >> So the big driver, you said at the top of the discussion, the big driver is digital transformation. Digital transformation. Organizations are trying to be more data-driven. Okay, this is completely throwing, throwing traditional IT amok, because we're not living in the traditional world anymore of all my data sits within a single data center, I run my traditional monolithic applications. That's changed. The world is no longer running in a traditional four wall data center, and the world's moved away from the traditional view of scale-up architectures to elastic compute, shared nothing, elastic storage environment. So what's happening is, you've got the challenge of trying to essentially support traditional transformation initiatives, and it's just throwing all the underlying infrastructure foundations that an entire generation of IT professionals has known (laughs) into disarray. So everything's a little bit caddywhompus right now. >> Mm-hmm (affirmative), Chris? >> Well, and like you said, those people all have gone from being implementers to, they're moving to being developers. >> Right. >> And it completely changes their, it has to be a big change in their mindset. And it changes the management folks, the CIOs, the CDOs, the people that you interact with on a daily basis, right? >> Absolutely. >> Because these people are all trying to kind of come up to the next generation and get there. >> So you talked about, we got re:Invent coming up in a couple of weeks and, I think reinvent's a perfect term for this entire conversation, because everybody is reinventing themselves. The customer's reinventing themselves, the IT organizations are reinventing themselves, the individual roles within organizations are changing, and the whole evolution of dev ops versus traditional roles, so it is really-- >> And the vendors are all trying to reinvent themselves, too. >> Yeah, absolutely, absolutely. >> Well there's a lot of noise, so the customer's being bombarded with pitches. And if I here one more digital transformation pitch, without substance, I still don't understand. So in the spirit of trying to understand, first of all, I believe in digital transformation, but you can't just say the word, you gotta to prove it. But there's hard to prove a new approach or they've never seen it before. It's kind of like Steve Jobs would say, "If you want a Blackberry, that's a phone, "but the iPhone's not what you've seen before." But everyone loved it, changed the industry. That dynamic's happening in the cloud where for instance, your solution, some might not have seen before, but it's highly relevant to the user behavior expectations of the new environment. Okay, so this is the issue. What is the new environment specifically around digital transformation? Because I have an investment in storage. If I'm a customer, I bought a zillion drives from NetApp and EMC. I got data domain backup and, I got a perimeter, I have all this stuff, and now I've got this cloud thing bursting, and I got some analytics running there, and then I got the hot shot young developers banging out apps, and they want to put it in the cloud and... and security, I mean, what's going on? >> You wanna take that one first? And then I'll jump in. >> Can't I just buy more storage? >> Yeah. (Men laugh) Hey, just, no John, you don't just buy more storage, you upgrade from spinning to flash. I mean, that's really, >> There you go. >> That's really, really cutting edge right there. No I think what a lot of you see what they're doing is basically saying listen, for all this secondary, tertiary, quaternary, I mean, I didn't even know what that word was. But your second, your third, your fourth cuts of that data, move that all to the cloud, get that out of my environment. I'm not gonna be submersed in dealing with all of that anymore. Then maybe I can clear out some of my headaches, so I can actually focus on that primary cut, and what do I do about that primary cut? And that's where these completely new approaches come into play, and I, Peter I don't know if you call that hybrid, or multi-aire or what? But it is basically just trying to get some of that noise out of their system, so they can focus on the thing that's most valuable. >> So the way I would make that tangible John, is sort of, to us it all rolls down to the notion of the modern IT stack, okay? So essentially, the way you respond to digital transformation which, is all about being more agile, and some of the buzzwords you hear, but they're trying to be more, customers are trying to be, vendors are trying to be, or excuse me, customers or organizations are trying to be more customer-centric. They're trying to be more business driven, more data driven, okay great. If that's their initiative-- >> That's a mission. That's a mission. >> That's a mission. >> Yep. >> What that means for IT specifically is a fundamental rearchitecture of the underlying stack, okay, along a couple vectors, which is, organizations are building these new applications. They're fundamentally rearchitecting applications. What used to be a monolithic-oriented, traditional, relational, on-prem database is now running in a microservices, highly distributed configuration. That's vector number one, implication. Implication number two is we're absolutely in the mainstream of hybrid cloud, okay? You may be running all your apps on-prem, but you're still connected in some way to the cloud, for archiving, for BI, for TASDAV, whatever the case may be. And number three is the world just moved completely to an elastic, compute, shared nothing world. So we call that the modern IT stack. So the modern IT stack, modern infrastructure today-- >> Share nothing, you said? >> Shared nothing, the cloud is-- >> Oh, shared nothing. >> Yeah, shared nothing, shared nothing storage, shared nothing compute, that's that's, those are the foundations of a cloud based architecture. >> Is that called serverless? >> You could call it serverless as well. >> Okay. >> But, if you look at the modern IT stack, so to your point, the modern IT stack, modern infrastructure today is EC2. >> Mm-hmm (affirmative). >> Modern storage is S3. It could be object prem, object storage sitting on-prem. You know, modern applications are IOT. Modern, or our customer 360, IOT. Modern databases are dynamo DB. It's MongoDB, it's the number two-- >> Right. >> database in the cloud. So to answer your question very specifically, to make it tangible, that's to us the fundamental indication is, that new modern IT stack, throws storage into disarray, it throws data management into disarray-- >> It's an operational disruption. >> It's an operational disruption. >> All right, so let's backup for a second, because I think you nailed the thread I was trying to connect on. So let's take MongoDB, your reference to that being, where'd that come from? We all know why, the LAMP stack, it was one of the drivers. But developers drove that. >> That's right. >> So it wasn't the IT department recommending Mango. >> Right (laughs). >> so the developers were driving that because of ease of use. Now there's some scalability with Mango, we all know about, but what that means is, no one gives a crap if it can scale, because you already hit your product market fit. Then you could rearchitect, so you're seeing this use case of developers driving some of the behavior. >> Yes. >> Yes. >> Mm-hmm (affirmative). >> Hence containers, docker containers, and the role of Kubernetes. >> Kubernetes, yep. >> So if that's the case, how does an enterprise customer deal with that vector? Because now the developers are dictating the stacks. >> Mm-hmm (affirmative). >> Well, I-- >> Is it a free-for-all right now? I mean, this is... >> I think both of those guys are, think of it as they used to be warring factions, dev and ops, and the fact that we say the word dev ops right now is kind of a, it's kind of an oxymoron, right? Because they don't actually know each other and actually don't naturally talk to one another, and they go, "That's the other guy who's holding me back." >> Yeah, it's the old-- >> They look at, yeah, yeah. >> Goes over the fence. >> And so now, you've got folks that are really trying to, trying to bring it together a little bit more on that front and I think that, we're starting to see some technologies where people can say, "Not only can I use that "to accelerate my developments," so meets the dev criteria, but also the ops people say, "You know what, that stuff's not so bad. "I could actually work with that." >> Right, and then there's IT going, "Uh-oh," because they're basically sitting there on the catcher's side, so to your point it's, the dev ops, it is very much of an application-led environment. The tip of the spear for the new IT stack is absolutely application-led. And IT is challenged with essentially aligning to that, collaborating with that, and keeping up with that pace of change. >> And John, on this point, I think this is where, back to re:Invent, and really the role of AWS. This all started because of that. When a developer can just say, "I don't even know who those IT people are over there, "But I can spin up my S3 instance, "and I can start working against it." They start moving down the path, they show it to somebody, someone says, "Wow, that's great stuff, I want that." >> John: Yeah, right. >> Guess what? We need to make sure that that's enterprise class and scalable and then that's where that whole thing starts, and then it becomes that pull-ya-apart, "Oh God, what did these developer people do? "I'm gonna inherit this? "What the heck am I gonna do with it?" Now it's, we've gotta move that to be more symbiotic up front. >> I remember talking to both Pat Gelsinger and Andy Jassy years ago, I think maybe five years ago, and I asked the question, "What enables developers?" What is enabling point? Does infrastructure dictate developer behavior? Or do developers dictate infrastructure behavior? This was years ago, when the dev ops was an early-on movement. Clearly the vote is there. Developers are driving infrastructure. Hence the dev ops infrastructure, >> Absolutely. >> Yeah. >> as code model, that's proven. Jassy was interesting because he looked at it that way and said, "Yeah, we saw the same thing," and they've never wavered, Amazon's stayed on the course, and they've just been running like a machine, like a, just pounding it out. I asked Pat Gelsinger, he once positioned the AWS as the developer cloud. Kinda in, I wouldn't say depositioning them, but he was basically pointing out, they have a developer cloud. Now Amazon's the enterprise cloud. >> Mm-hmm (affirmative). >> Because they've developers are now a big driver of that, and the scale with data is actually turning out to be a better security environment. >> Right. >> For cyber. >> Right, it might just-- >> So it's cloud's winning. >> Cloud is winning and just sort of just take that one step further. It's always ultimately, the winner's going to, it's Darwinism, it's like the winner's gonna be the one with the richest ecosystem. And AWS is becoming that enterprise eco. And you could argue, I mean, GCP's fighting to be in there, Oracle's not going to go quietly into that dark night. You've got multiple public cloud vendors. >> That's right. >> Yeah. >> But the reality is that he who has the biggest, he or she who has the biggest ecosystem is gonna win, and that's right now is AWS driving that bus. >> All right, so I need to see those glasses for a second, and then want to go into another line of question here. (men laugh) >> You may use those. >> Oh who's, oh you put them on, all right good, as long as he's wearing them. >> He that wear-- >> You know, on that front too, on that front too, I would think we started back where VM was the big new thing, and here we go with VM's, and then all of a sudden we're coming up and we're saying, "Yeah, now there's containers." And so now we're gonna see this move to, we want to micro-package these services, and be able to aggregate them. Well you know the average IT shop that I would be talking to out there is just still trying to figure out, how do they put together their on-prem and their AWS instance? So this notion of hybrid is where most of these large enterprises are. We see a lot of terminology out there and a lot of vendors talking about multi-cloud. But multi-cloud is really just taking an option on the future and saying, "I'm not locked into you, AWS, "even though I am locked into you 100% right now. "I don't want to be forever in the future." >> It's a value statement that they're gesturing. >> That's right. >> Good segue. >> Chris: But it's not a practical implementation piece. >> I got my nerd glasses on so-- >> Peter: Strap in for something, here we go. I got my nerd glasses, so next question, we'll go a little nerdy, because this is important one. I put out at my crowd chat for Amazon, so to crowdchat.net/awsreinvent it's open, I have a lot of questions on there. Feel free to weigh in, it's an influencer-only chat, so no consumers, so I asked the question, and this is to the value statement, because multi-cloud is basically telegraphing lock-in. We don't want lock-in. >> Right. >> But we want love choice. If you have good choice and good value, we'll go there so it's a value equation. So the question I said is, where do you, this is a question I put on crowd-chat, I'll ask you guys. Where do you see the value that cloud creates for customers in the next 24 months? #cloud So the first response was from Subbu Allamaraju, who's the CIO at Expedia. He writes, "Agility from the service "ecosystem and rapid second-order architecture "architectural changes thereby clearing technical debt." And the second one from Grant Chase, "Born on the cloud apps already here. "Next wave migrating of existing apps." And then Maddoux Tsukahara said, "Legacy SASS applications will be disrupted "by cloud microservices, serverless, "and AI and machine learning." So we start to see the pattern. Your thoughts? Value creation, in the cloud, is gonna be what? >> So I think they're hitting on the right trends. I would go back to the first one which is "How do I get this on-prem stuff "that's driving me crazy, consuming all of my resources "in terms of maintenance and upgrades? "And then optimizing my environment for that." Which ones of those are core? And which ones of those are really kind of ancillary? I've gotta have them, but I really don't want them. If I didn't have to use them, I'd get rid of them. Take all, just do that homework. Separate the two cleanly. Move ancillary to the cloud, and move on. >> Peter: Yeah, yeah. >> So service ecosystem he nailed, I love, by the way, I agree with you, that was my favorite answer. And rapid second-order architecture changes. This speaks to what datos.io is doing. Because you guys, what you're in, the tornado that you're in, kind of just a play on the Chasm group here. You guys have a solution that has got visibility into some of the real dynamics of the environmental environment. >> Check. >> People, tech, stack, et cetera. >> Yeah, yeah. >> So what are some of the things that you're seeing that point to these second or level architectural changes? >> Well you mentioned, a couple different things, which is, you mentioned the notion of technical debt, which is indirectly what you were just talking about, the ability to get rid of my technical debt. It's an easy way, it eliminates my barrier to answering to creating net new applications. So without having to sort of, I avoid the innovator's dilemma if you will, because I can build these net new applications, which are the things I have to to drive my digital transformation, et cetera. I can do that in a very cost-effective and agile way. Meanwhile, sort of ignoring the old world. Then what I'll do is I'll go back, and I'll worry about the old stuff, and I'll start migrating some of that old stuff to the cloud. So in the context of, yeah, so what we see from a Datos IO perspective, in the context of data management, is that one, applications drive the stack, like you said earlier, it's absolutely, the application's at the tip of the spear, driving the stack. Organizations are building net new applications that are cloud native, okay? And they're built on the new modern IT stack, and at the same time, they're also taking their legacy application, so I like that second answer as well which is, modern cloud applications are here. The interesting thing is, you say modern cloud apps, modern cloud apps don't have to run in the cloud. >> That's right. >> We've got customers that are running their next gen app-- >> It's an operating model. >> It's an operating model. We've got customers running 100% on-prem. Their econ number stuff runs on-prem, then you have people that run in the cloud. So it's a mindset, it's an operating model. So you've got folks absolutely deploying these cloud-native apps. >> Well, it's an architectural model too, it's how they are deploying and servicing apps. >> And ultimately, it comes down to the architectural model. That's what shifted, and that world is very infrastructure. The other thing I would add to the cloud thing is if you do it right, the cloud actually can give you architectural independence and cloud independence, but you can't be focused on the infrastructure level. You've gotta focus at the application level, because then you can be agnostic, until they're online. >> So Peter you, you guys are disrupting a very large space, backup and recovery in the cloud which you guys are doing. >> Check. >> And the application database layer is a very progressive solution. So I love your approach, but you're talking about disrupting the data domains of the world. We're talking about big whales. >> Yeah. >> Big incumbents that are built around four walls in the data center. >> Check. >> Mm-hmm (affirmative), yep. >> What are you seeing? What's the makeup? What's the personnel of the customers look like? If dev ops is happening, which we agree it is, and the the evidence is there clearly, they're not 50 year old backup and recovery guys. They're young guns, they're probably not thinking about waking up every day with their coffee, say, "Hmm, what am I gonna do with backup today?" >> Yeah. >> Mm-hmm (affirmative). >> They're waking up saying, "Hey, I'm gonna drive some more machine learning "and AI in my apps." >> Yep. >> "And I'm gonna provide workflow movement to--" >> And you said breakfast was some, you said that. >> Adopt this microservice. >> I had the craziest dream last night. It was microservices, what? >> Yeah. >> Yeah, so I can answer that two ways. There's the technology side of it. Fun little tidbit, average age of the traditional backup and recovery software architecture, about 20 years. >> Hmm. >> Architected well before the mainstream advent of the cloud or certainly modern applications. >> Hold on, the person's 20 years old? Or it's 20 years of architecture? >> No, the architecture of the software. >> Okay. >> The solutions, or come up, the point is they've been around for awhile. >> It's old. It's old. >> It's old, fair enough. >> Yeah, and 20 years-- >> So on the technology side, that's a dilemma. On the persona side, you're absolutely right as well. These are, it's the application folks that are driving the conversation, that our applications dictate the IT stack. They're building these new architectures, which have all these implications on the infrastructure. >> All right, so I'm gonna play devil's advocate, just because I want to connect the dots. And again, illuminate what I think the problem is that you have. One is, okay I'm a CIO. Hey, he's my storage guy. Who the hell are you, young gun? Complaining about your backup and recovery. He recommends all flash arrays in the data center provisioned in a VSAN environment, whatever that's going on. Who are you? You're just nothing to me. You don't make that decision. >> I'm the guy that can give you all the visibility to your data to make you smarter and more agile as a company. I can save you money. I can make this company more market-- >> So what do I need to do differently? If I'm the CIO, I don't want to make these, or these architectural calls based upon old dogma or old reporting lines. This is an example. I go to him, he's my storage guy. Who are you? I already built you the dev ops environment. He runs storage and so, you're impacted as a developer. So how do you guys talk to that guy? What does the CXO have to do differently to adapt to the new environment? >> I'll take that and then you can-- >> Please. >> You know, jump in. So I think what you see is, you see the proliferation of new personas. Like you see chief transformation officers, you see chief digital officers. You see system architects and DBAs getting a more prominent role in the conversation. So the successful CIOs and technology officers are the ones that are essentially gonna get the cowboys and the Indians to collaborate more closely, because they have to, because the folks that were over in the corner that used to get laughed at, building these, oh mangos and these new applications and such, they're the ones holding the keys to the future. So the successful technologists are gonna be the ones that marry those personas from the application side of the house with the traditional storage, infrastructure folks as well. You successfully do that, then you can be more, then you can move more quickly forward. >> Yeah, that's right. >> What do you think? >> Well I think some of it's gonna come back down to economics, too. And I agree with that move which is, I talked to over a hundred CIOs and their staff in the last year. I had one conversation where the person said, "You know what? "The chief complaint about me as CIO "is I'm not spending enough money." And I thought to myself, "Sounds like a company that I should put some bucks into, "because they must be doing really, really well." Everybody else is looking at it saying, "You know what? "I'm under pressure to adopt the cloud, "because there's a belief out there "that the cloud is gonna be so much less expensive "than what they've done in the past." And then I think they find that it's not, that it's not just the one size fits all answer to that. >> Right. >> And so as a consequence, you're gonna have people say, Listen, this money printing operation, or this funnel out the door to, whether it's EMC or NetApp 4, or whatever it may be, whatever storage vendor for backup architecture, they've got to stop that funnel. Because they've got to take what they were spending there and move it to the things that are going to make money for them, not just gonna hold on to it, and de-risk their enterprise. >> I'm here with two industry leaders, Chris Comings and Peter Smails, talking about the impact of infrastructure technologies, and app development in the cloud for businesses. It's a great conversation, and our final point, I wanna just get to, I know we're running on some time here but we wanna go a little further. I think this is awesome. That's for taking the time to share it out. >> It's great. >> One of my other questions I put on my crowd chat was, a true or false and comment question. Here's the statement: Serverless computing will become mainstream, will come to mainstream private cloud, true or false, comment. Subbu said, "False, adoption and success "of serverless patterns depend almost entirely "on the strength of the ecosystem "that the data center lacks." Interesting comment. I was kinda leaning, I go, "I was leaning towards true." But I don't have enough insight on this, because I'm waffling between true or false. I love serverless, I love the idea of, notion of resources that are just programmable. But what is the state of serverless? I mean, is he right? Is that that there's not enough ecosystem in the data center areas or... >> You wanna go first? >> Well, I'd just say that I would, I would just call out two things on that front. One is, I think you need a lot more germination of microservices that are out there in order to be able to put that all together. That's one aspect. We're seeing that growth come rapidly. The other thing is, now your security is beholden to the lowest common denominator. The security of that individual microservice. So I think you're gonna have some fits and starts here as we move down that path because, boy oh boy, the last thing I wanna do is get all modern but at the same time, put myself at a greater amount of risk. >> I thought the comment at the end was, I think it's true. I thought it was interesting what he said at the end. He said, "The ecosystem that the data center lacks." I would contend that potentially, the ecosystem that the cloud has would support that. >> Yeah. >> Because the cloud, by definition is, it's a shared-nothing world. >> Right. >> You know? >> So, he also comments, someone said, Lambda, "My Expedia is that Lambda's growth "is almost entirely due to the power "of the ecosystem of services, "which is one of the key points," and he points to his blog post. Stu Miniman, our Wikibon analyst weighed in, because Stu's on this big time. "Service will definitely be used for edge applications. "Currently don't see use case for general data center usage." >> Mm-hmm (affirmative). >> So edge of the network. Again, good point? This edge of the network thing helps you, because most people are using cloud for edge. >> Peter: Right. >> So this IOT, which is, an iterative things, is an edge of the network. >> Yeah, yeah. >> Whether it's devices, sensors, industrial equipment, or people's devices on their bodies. >> Yeah. >> It's a huge data source. >> Absolutely. >> Cloud's rolling that up. Or a cloud-like infrastructure. >> Well but it's not necessarily rolling it up. It's just connecting all the dots as to where you can put storage and you can put compute where the data is. Or you can move the data to where the storage and the compute is. So it's not, I mean, yes there's core and edge, that's absolutely true, but the notion of rollup isn't necessarily true. It's not necessarily the cloud enables me to do all this colossal aggregation. It's I basically distribute my compute, I distribute my storage. >> Well, when I say rollup, I'm assuming there's some sort of architectural thing. >> Okay, fair. >> But this fits into your wheelhouse, I think. But I just connecting the dots. That's why it's a question for you is, it would make sense for a solution like DATOS to be there because, That's a application so you-- >> Absolutely. >> You back up IOT? >> Oh absolutely. We backup IOT, but we basically backup any modern cloud application. And by definition, what does that mean? >> So IOT's and app for you. >> IOT, absolutely IOT's-- >> Not necessarily a-- >> So the technically where we plug in is, we plugin at the database level. And the databases basically, are the underlying infrastructure that support the applications. So in the case of IOT, those are typically very highly distributed across GIOS, absolutely we protect them. >> So we were just talking earlier about the words flexibility, manageability, agility. That's kind of vanilla words that everyone uses these days. But in essence, you're actually really doing it. Right, so. >> Thanks for that setup. Yes, we actually do all those buzz words. >> So Chris recommends, I recommend that you call it, hyper flexibility. >> Yeah. >> Or microflexibility. >> Or ultra. >> Or ultra flexibility. >> Or go mega. Just go mega right now. Or uber and steal a little of that, although that's kind of out of favor right now. >> Not, uber is-- >> Uber we wanna let that one kind of fly by. >> But remember we also talked before, we thought we were spot on with our product being branded RecoverX. We thought we were really in the spot with the whole, you know. >> Your name is awesome. RecoverX is a great brand. >> So we're gonna stick with that for now before we-- >> Good branding, RecoverX, Data IOS. Chris, thanks for coming on. Final comment, any words on the storage industry as it evolved? You mentioned earlier, just call it flash. Certainly, all flash arrays are doing well. Pure Storage went public. Flash is a standard. >> Yeah. >> It has benefits. Where does the flash storage go with all this cloud value coming over the top? >> Well I think, you know, there's gonna be a couple. I have one comment on that which is, we see what flash is doing at the array level, and now we're gonna see what NVME does at the cash layer, for allowing this access to information. You think about, I want to run a singular query, but some of that data is here, there, everywhere, but I've gotta have a level of performance that allows me to actually run it, and get an answer from it. And so that's where that comes into play. I think we're gonna see a whole host of folks flooding into that space, to try and improve performance, but not only improve performance, but enable that whole distribution model. >> Yeah, and I would just pick up on more persona-centric thing which is, the message to the traditional IT shops is it is all about collaboration. The folks over in the corner, the application folks, it is absolutely all about getting more closely aligned, because cloud is here. >> Yeah. >> Multicloud, hybrid cloud, call it whatever you want, is here. The traditional IT stack is absolutely being disrupted, and it's all about embracing this application-centric, data-driven view of the world. That's the future, traditional IT's got to align with that, and collaborate and drive that whole thing forward. >> That's a great, I agree 100% what you guys just said, great comment. I would just say Wikibon calls it unigrid, which is, I'll rename it hypergrid, meaning it's just one system, to your point. Private, public, it's all cloud-like. >> Absolutely. >> Yeah, it doesn't matter where it goes. Okay guys, thanks for the thought leadership. Peter Smails and Chris Cummings here, breaking down the industry landscape on storage infrastructure, application developers, in context the cloud. This is theCUBE conversation. I'm John Furrier, thanks for watching. (motivating electronic music)

>> Hey welcome back everybody, Jeff Frick here with theCUBE. We are in downtown San Francisco at the Mission Bay Convention Center at Node Summit 2017. We've been coming to Node Summit off and on for a number of years. And it's pretty amazing, the growth of this application for development. It really seems to take off. There's about 800 or 900 people here. It's kind of the limits of the facility here at Mission Bay. But we're really excited to be here. And it's not surprising to have me see Intel is here in full force. Our first guest is Monica Ene-Pietrosanu. And she is the Director of Software Engineering for Intel, welcome. >> Thank you, hello, and thank you very much for inviting me. It's definitely exciting to be here. Node is this dynamic community that grows in one year, like others can. So it's always exciting to be part one of these events. And present about the work we are doing for Node. >> So you're on a panel later on Taking Benchmarking to the Next Level. So what is that all about? >> That is part of the work we are doing for Node. And I want to mention here the word stewardship. Intel is a long time contributor in the open source communities. And has assumed a performance leadership in many of these communities. We are doing the same for Node. We are driving, we are trying to be a steward for the performance in OJS. And what this means, is we are watching to make sure that every check in that happens, doesn't impact performance. We are also optimizing Nodes, so it give the best of the hardware, Node runs best on the newest hardware that we have. And also, we are developing, right now new measures, new benchmarks which better reflect the reality of the data center use cases. The way your Node is getting used in the Cloud. The way Node is getting used in the data center. There are very few ways to measure that today. And with this fast development of the ecosystem, my team has also taken this role of working with the industry partners and coming up with realistic measures for the performance. >> Right, so these new benchmarks that you're defining around the capabilities of Node. Or are you using old benchmarks? Or how are you kind of addressing that challenge? >> We started by running what was available. And most of the benchmarks were quite, let's say, isolated. They were focused on single Node, one operation, not realistic in terms of what the measurements were being done for the data center. Especially, in the data center everything is evolving. So nothing is just running with one single computer. Everything is impacted by network latencies. We have a significant number of servers out there. We have multiple software components interacting. So it's way more complex. And then you have containers coming into the picture. And everything makes it harder and harder to evaluate from the performance perspective. And I think Node is doing a pretty good job from the performance perspective. But who's watching that it stays the same? I think performance is one of those things that you value when you don't have it, right? Otherwise you just take it as granted, like it's there. So, my team at Intel is focused on top tier scripting languages. We are part of this larger software organization called Software and Services Group. And we are, right now, optimizing and writing the performance for Python, No-gs, PHP HHVM, and for some of the top tier languages used in the data centers. So Node is actually our interesting story in terms of evolution. Because we've seen, also, an extraordinary growth. We've seen, it's probably the one who's doubled for the past three years. The community has doubled. Everything has doubled for Node, right? Even, the number of commits, it depends on which statuses you look-- >> They're all up and to the right, very steep. >> Yeah, so then it's a very fast progress which we need to keep pace with. And one thing that is important for us is to make sure that we expose the best of our hardware to the software. With Node that is taking an interesting approach. Because Node is one of, what we called CPU front end bounce. It's having a large footprint. It's one of the largest footprint applications that we've seen. And for this we want to make sure that the newest CPUs we bring to market are able to handle it. >> I was just going to say, they have Trevor Livingston on it from HomeAway. Kicked off things today. We're talking about the growth. He said a year ago, they had one Node JS project. And this is a big site that competes with, like, Air B&B. That's now owned by Expedia. Now they say, he said, they had, "15 projects in production. "22 almost in production, and 75 other internal projects." In one year, from one. So that shows pretty amazing growth and the power of the application. And from Intel's point of view, you guys are all in on cloud. You're all in on data centers. You've all seen all the adds. So you guys are really, aggressively taking on the optimization, for the unique challenges and special environment that is Cloud. Which is computing everywhere, computing nowhere. But at the end of the day, it's got to sit on somebody's servers. And there's got to be a CPU in the background. So you look at all these different languages. Why do you think Node has gone so crazy? >> I think there are several reasons. And my background is a C++ developer, coming and security. So coming into the Node space, one thing amazed me. Like, only 2% of the code is yours, when you write an application. So that is like-- >> Jeff: 2%? >> So where is the other 98% coming from? Or it's already pre developed. It's an ecosystem, you just pull in those libraries. So that's what brings, in addition to the security risks you have. It brings a fantastic time to market. So it enables you as the developer to launch an application in a matter of days, instead of months or a year. So time to market is an unbeatable proposition. And I think that's what drives this space. When you need to launch new applications faster and faster, and upgrade. For us, that's also an interesting challenge. Because we have, our super road maps are not days, right? Are years? So what we want to make sure is that we feed back into the CPU road map the developments we are seeing into this space. I have on my team, I have several principal engineers who are working with the CPU architects to make sure that we are continuously providing this information back. One thing I wanted to mention is, as you probably know, since you've been talking to other Intel people, we've been launching recently, the latest generation server, Skylake. And on this latest generation Nodes. So all the Node workloads we've been optimizing and measuring. So one point five x performance improvement, from the prior generation. So this is a fantastic boost. And this doesn't happen only from hardware. It happens from a combination of hardware and software. And we are continuing to work now with the CPU architects to make sure that the future generation also keeps space with the developments. >> It's interesting, kind of the three horsemen of computing, if you will, right? There's compute, there's store, and there's IO. And now we're working, and it's interesting that Ryan Dahl, it's funny, they brought up Ryan Dahl. We interviewed him back at the Node JS, I think back in 2011? Still one of our most popular segments on theCUBE. We do thousands of interviews a year. He's still one of the most popular. But to really rethink the IO problem, in this asynchronous form, seems to be just another real breakthrough that opens up all types of capacity in compute and store. When you don't have to sit and wait. So that must be another thing that you guys have addressed from coming from the hardware and the software perspective? >> You are right on spot, because I think Node, comparing to other scripting languages brings more into the picture, the whole platform. So it's not only a CPU. It's also a networking. It's also related to storage. Also, it makes the entire platform to shine if it's optimized to the right capability. And we've been investing a lot into this. We have all our work is made available is open source. All our contributions are up-streamed back into the mainstream. We also started an effort to work with the industry in developing these new workloads. So last year at Node Interactive, we launched one new workload, benchmark, for Node. Which we called Node DC. With his first use case, which is an employee information system, simulating what a large data center distributed application will be doing. This year, now at Node Summit, we will be presenting the updated version of that, one point zero, this time. It was version zero point nine, last time. Where we added support for containers. We included several capabilities to be able to run, in a configural manner, in as many configurations as needed. And we are also contributing this back. We submitted it to the Node Foundation. So it becomes an official benchmark for the Node Foundation. Which means, every night, after the build system runs, this will be run as part of the regressions. To make sure that the performance doesn't degrade. So that's part of our work. And that's also continuing an effort we started with what we call the languages performance portal. If you go to languagesperformance.intel.com we have an entire lab behind that portal, in which every night we build this top tier scripting languages. Including Python, including Node, including PHP, and we run performance regressions on the latest Intel architecture. So we are contributing the results back into the open source community, to make sure that the community is aware if any regression happens. And we have a team of engineers who jumps on those regression center root causes and analyzes it. So to figure it out. >> So Monica, but we're almost out of time. But before I let you go, we talked before we got started, I love Kim Stevenson, I've interviewed her a bunch of times. And one of the conversations that we had was about Moore's Law. And that Moore's Law's really an attitude. And it's kind of a way to do things more than hitting the physical limitations on chips, which I think is a silly conversation. You're in a constantly, the role of constantly optimizing. And making things better, faster, cheaper. As you sit back and look at, kind of, what you've done to date, and looking forward, do you see any slowdown in this ability to continue to tweak, optimize, tweak, optimize? And just get more and more performance out of some of these new technologies? >> I wouldn't see slow down. At least from where I sit on the software side. I'm seeing only acceleration. So, the hardware brings a 30%, 40% improvement. We add, on top of that, the software optimizations. Which bring 10%, 20% improvements as well. So that continuously is going on. And I am not seeing it improving. I'm seeing it becoming more, there is a need for customization. So that's where when we design the workloads, we need to make them customizable. Because there are different use cases across the data center customers. So they are used differently. And we want to make sure that we reflect the reality. That's how they're in the world. And that's how our customers, our partners can also leverage them, to measure something that's meaningful for them. So in terms of speed, now, we want to make sure that we fully utilize our CPU. And we grow to more and more cores and increase frequency. We also grow to more capabilities. And our focus is also to make the entire platform to shine. And when we talk about platform we talk about networking. We talk about non volatile memory. We talk about storage as well as CPU. >> So Gordon's safe. You're safe, Gordon Moore. Your law's still solid. Monica, thanks for taking a few minutes out of your day and good luck on your panel later this afternoon. >> Thank you very much for having me here. It was pleasure. >> Absolutely, all right, Jeff Frick checking in from Node Summit 2017 in San Francisco. We'll be right back after this short break. Thanks for watching. (upbeat music)

>> Announcer: Live from San Francisco, it's The Cube. Covering Spark Summit 2017. Brought to you by Databricks. >> The Cube is live once again from Spark Summit 2017, I'm David Goad, your host, here with George Gilbert, and we are interviewing many of the speakers that we saw on stage this morning at the keynote. Happy to introduce our next guest on the show, his name is Matt Fryer, Matt, how're you doing? >> Matt: Very well. >> You're the chief, Chief Data Science Officer, I don't see many CDSOs out there, is that a common-- >> I think to say, it's a newer title, and it's coming, I think, where companies that feel the use of data, data science and algorithms, are fundamental to their, their futures. They're creating both the mix of commercial, technical, and algorithmic skill sets, this one team, and to execute together, and that's where the title came from. There's more coming, there's a number of-- Facebook have a few, that's one for example, but it's a newer title, I think it's going to become larger and larger, as time goes on. >> David: So, the CDSO for Hotels.com, something else we learned about you that you may not want me to reveal, but I heard you were the inspiration for Captain Obvious, is that true? >> Uh, that's not true. (laughter) I think Captain Obvious is only an expression of my brand, so there's an awesome brand team, at our office in Dallas. (crosstalk) We all love the captain, he has some good humorous moments, and he keeps us all kind of happy. >> Oh, yeah, he states the obvious, we're going to talk about some of the obvious, and maybe some of the not-so obvious here in this interview. So let's talk a little bit about company culture, because you talked a lot on the stage this morning about customer-first kind of approach, rather than a, "Ooh, look what I can do with the technology." Talk a little bit more about the culture at Hotels.com. >> And that's important, and I think, we're a very data-driven culture, I think most tech companies, and travel, technology companies have that kind of ethos. But fundamentally, the focus and the reason we exist is for the customer. So we want to bring, and actually-- in even better ways than that, I think it's the people. So whether it's the focus on the customer, if we did the right thing by the customer, we fundamentally want you to use our platform time and time again. Whatever need you have, booking, lodging and travel, please use our platform. That's the crucial win. So, to do that, we have to always delight you in every experience you have with us. And equally about people, it's about the team, so we have an internal concept called being supportive. So the whole part of our team culture, is that everybody helps everybody else out, we don't single things out, we're all part of the same team, and we all win if all of us pull together. That makes it a great place, a fun place to work, we're going to play with some new technologies, tech is important to us, but actually the people are even more important to us. >> In part why you love the Spark Summit then, huh? Same kind of spirit here, right? >> It's great, I think it's my third Spark Summit, my second time over in San Francisco, and the size of it is very impressive now. I just love meeting other people learning about some of the things they're up to, how we can apply those back to our business, and hopefully sharing a little bit of what we're up to. >> David: Let's dive into how you're applying it to your business, you talked about this evolution toward becoming an algorithm business, what does that mean and what part does Spark play in that? >> Matt: I think what it is, is about how do you, if you think about a bit of the journey, historically, a lot of the opportunity came in building new features, constantly building it, it's almost like a semi arms race, about how to build more and more features. The crucial thing I think going forward, and particularly with mobile devices now, we have over half our traffic, comes from people using smartphones, on both the app and mobile web. That bringing together means that, be more targeted, in understanding your journey, and people are, last on to time, speed is much more important, people expect things to be right there when they need it, relevance is much more important to people, so we need to bring all those things together to offer a much more targeted experience, and a much more real-time experience. People expect you to have understood what they did milliseconds ago, and respond to that. The only way you can do that is using data science and algorithms. You balance out on a business operation side, just how do you scale? The analogy I use with, say, anomaly detection, which is a crucial feature for enterprises. Used to have a large business intelligence, lots of reports, pages of paper, now people have things like Tablo, Power BI, those are great and you need those to start with, but really as a business leader, you want to know, "Tell me what's broken, tell me what's changed, "because if it's changed something caused the change, "tell me why it's slowly moving, and most importantly, "tell me where the opportunity is." And that transforms the conversation where algorithms can really surface that to users, and it's about organic intelligence, it's not about artificial intelligence, it's about how would you bring together the people, and the advance in technology to really do a great job for customers. >> David: Well, you mentioned AI, you made a big bold claim about AI, I'm going to ask George to weigh in on this in just a moment, you said AI was going to be the next big thing in the travel industry, can you explain? >> One of the next big things, I think. Yeah, I think it's already happening, in fact, our chairman, Mr. Diller made that statement very recently, also backed up by both the CEO and the brand president, where it's... If you think about 20 years ago, one of the things both Expedia and Hotels.com, and travel online space did, were democratize price information, and made it transparent to users. So previously, the power was with the travel agents, that power moved to the user, they had the information. And that's evolved over time, and what we feel with artificial intelligence, particularly organic intelligence, enablers like mobile, messaging and having conversations, have a machine learning how to make this happen, that you can turn the screen around and actually empower users always with the second revolution. They actually have the advice, and the benefits you had a number of years ago from travel agents: A, they had the price transparency, they have the other part now, which is the content, advice, and what's the most relevant to help them. And you can listen to what they're saying to you, as a customer, and actually we can now replay the perfect information back to them, or increasingly perfect as time goes on. (crosstalk) >> That is fascinating, 'cause in the way you broke that out, with--it wasn't actually only travel, but over the last couple decades, price transparency became an issue for many industries, but what you're saying now is, by giving the content to surprise and delight the customer, as long as you're collecting the data breadcrumbs to help you do that, you're not giving up control, you're actually creating stickiness. >> Matt: We're empowering, is the language I use. And if you empower the user, the more likely to come back to use your service in the future, and that's really what we want, we want happy customers. >> George: Tell us a little bit, at the risk of dropping a little in the wait, tell us a little bit about how you empower, in other words, how do you know what type of content to serve up, and how do you measure how they engage with it? >> It's a great question, and I think it's quite embryonic, part of the world right now. I don't think anybody's-- have we made some great developments? I said it was a long journey we have, but it's a lot about how do you, and this is true across data science machine learning, great data science is fundamental to having great feedback loops. So, there's lots of different techniques and tactics around how you might discover those feedback loops, and customers demand that you use their data to help them. So, we need to get faster, and streaming is one way, that's becoming feasible, and the advances in streaming and it's great Databricks are working on that, but the advances in streaming allows it to feed that loop, to take that much--those real-time signals, as well as previous signals, to really help figure out what you're trying to do today, what content-- interesting thing is, Netflix and Amazon were some pioneers in this space, where if you use Netflix service, often you go, "How the hell did they know "this video was going to be right for me?" And, some of the comments, and you can say, well, what they're actually doing is they're looking at microsegments, so previously everyone talked about custom segments as these very large groups, and they have their place, but increasing machine learning allows you to build microsegments. What I can start to do is actually discover from the behavior of others, things you likely-- very relevant things that you're going to be very interested in, and actually help inspire you and discover things you didn't even know existed. And by filling that gap and using those microsegments as well as put truly personal, personalization, I can bring that together to offer you a much more enhanced service. >> George: And so, help make that concrete in terms of, what would I as a potential--I want to plan a vacation for the summer, I have my five and a half inch or, five-seven iPhone, and that's my primary device. And in banking, it's moved from tying everything to the checking account, to tying every interaction to your mobile device. So what would you show me on my mobile device, that would get me really engaged about going to some location? >> So I think a lot of it is about where you are in that journey. So, you think, there's so many different routes customers can take, through that buying decision. And depends on the trip type, whether it's a leisure trip, seeing your family and friends, how much knowledge you may have about them, have you been there before? We look for all those signals, to try and help inspire. So a great example might be, if you stayed in a hotel on our site before, and you liked that hotel, and you come back and do a search again, we try and make it easy to continue by putting that hotel at the top. Trying to make it easy to task-complete. We have a trip planner capability you'll see on the home screen, which allows you to record and play back some of your previous searches, so you can quickly see and compare where you've been, and what's interesting for you. But on top of that, we can then use the signals, and increasingly, we have a very advanced filter list, and that's a key, and we're looking in stuff, how we do conversations in the chatbox, is this sort of future, how to have a conversation to say, "Hey, here's a list of hotels, which we used a mix of your, "the types of preferences understood about you, "and the wider thing, where you are in the world, "what's going on, what time of day." We take hundreds of different signals to try and figure out what the right list is for you, and from that list, the great thing is most people interact with that list and give us more signals, exactly what you wanted. We can hone and hone and hone, and repeat, 'cause I said at the start, for example, those majority of customers will do multiple searches. They want to understand what the market is, they may not be interested in one particular place, they may have a sweeter place there instead. Even now, where we've moved further up the funnel, investing behind, how can you figure out what destination you're interested in? So you may not even know what destination you're interested in, or there might be other destinations that you didn't know--with a very relevant for your use case, particularly if you're going on vacation, we can help inspire you to find that hidden gem, that hidden great prize, you may not even know it existed. Being the much better job, but to show you how busy the market is, to how fast you should be looking to book there, if it's a very compressed, busy market, you need to get in there quick to lock your price in, and we're now providing that information to help you make a better decision. And we can mine all that data, to empower you to make smart decisions with smart data. >> I want to clarify something I saw in your demonstration this morning, you were talking about detecting the differences between photos and user-generated content, so do you have users actually posting their own photos of the hotel, right next to the photoshopped pictures of the hotel? >> Matt: We do, yeah. >> David: What are the ramifications of that? >> So it's an interesting advancement we've made, so we've... In the last of the year, we now offer and asking users to submit their photos, to help other users. I think one of the crucial things is about how to be authentic. Over the years, we've had tens of millions of testimonial reviews, text reviews, and we can see they're really, crucially important to users, and their buying decisions. >> David: It scares the hotel owners to death though, doesn't it? >> Matt: Well, I think it does, but I think the testimony of the customer, could be one of the key things we call them, as we have verified reviews, so to leave a review on our site, you've had to stay in that hotel. We think that's a crucial step in really helping to say, "These are your customers." In recent times, we've taken that product further, to now when you actually arrive at the hotel within a few hours, We'll ask you what your first impressions were. We would ask if you want to share that with the hotel owner. To get the hotel owner a chance to actually rectify any early challenges, so you can have a great stay. And one of the crucial things we have is that, what's really, really important, is that users and customers have a great stay, that reflects on our Net Promoter score, and their view of us, and we need to fill that cycle and make sure we have happy users. So that real-time review is super crucial, in basing how can hotels--if they want happy users and customers as well, it helps them to cut a course correct, if there's an issue, and we can step in as well to help the user if it's a really deep issue. And then with the photos, the key to think is how to navigate and understand what the photo is, so the user helps us by tagging that, which is great, but how we-- >> David: Possibly mistagging it. >> Possibly mistagging it on occasion, that's something we've, we've built in some skill as you've heard, on how to tackle that, but the crucial thing is how to bring these together, if you're on a mobile device, you've got to scan through each photo, and in places around the world have limited bandwidth, a limited time to go through them, so what we're now working on is how to assess the quality of those photos, to try and make sure we authentically--what we want to do, is get the customer the most lively experience they will have. As I said before, we're on the customer's kind of focus, we want to make sure they get the best photos, the most realistic of what's going to happen, and doing the most diverse. You want to see three photos, exactly the same, and we're working on the moment, you can swipe left and swipe right, we're working on how that display evolves over time, but it's exciting. >> David: Very exciting, fascinating stuff. Sorry that we're up against a hard break, coming here in just a moment, but I wanted to give you just 30 seconds to kind of sum up, maybe the next big technical challenge you're looking at that involves Spark, and we'll close with that. >> Cool, it's a great question. I think I talked a little about that in the keynote, totally caught the kind of out challenge. How to scale a mountain, which has been-- there's been great advance on how to stream data into platforms, Spark is a core part of that, and the platforms that we've been building, both internally, and partnering with Databricks and using their platform, has really given us a large boost going forwards, but how you turn those algorithms and that competitive algorithmic advantage, into a live production environment, whether it's marketplaces, Adtech marketplaces or websites, or in call centers, or in social media, wherever the platform needs to go, that's a hard problem right now. Or, I think it's too hard a problem right now. And I'd love to see--and we're going to invest behind that, a transformation, that hopefully this time next year, that is no longer a problem, and is actually an asset. >> David: Well I hope I'm not Captain Obvious to say, I know you're up to the challenge. Thank you so much, Matt Fryer, we appreciate you being on the show, thank you for sharing what's going on at Hotels.com. And thank you all for watching The Cube, we'll be back in a few moments with our next guest, here at Spark Summit 2017. (electronic music) (wind blowing)

(upbeat electronic music) >> Announcer: Live from Santa Clara, California, it's theCUBE covering Open Networking Summit 2017. Brought to you by The Linux Foundation. >> Hey, welcome back, everybody, Jeff Frick here with theCUBE. We are in Santa Clara, California at the Open Networking Summit 2017. Really happy to be joined by my co-host for the next couple of days, Scott Raynovich. And we've been talking to a lot of providers and technical people, but now we want to talk to customers. We love talking to customers, and we're really excited to have Rashesh Jethi. He's the SVP, Head of R&D for the Americas for Amadeus, which is a big travel company. Welcome. >> Thank you so much, Jeff. Thank you, Scott. >> So like I said, we'd love to talk to a practitioner. So you're out on the frontlines, you're seeing all this talk of software-defined and software-defined networking. From your point of view, how real is it, where are we on this journey? What do you see from your point of view? >> Super real. Have you searched for a flight lately? >> I have searched for a flight. >> Excellent. I'm proud to tell you that your flight search very likely was powered by Amadeus, and it's running on a software-defined data center completely. So this stuff is real. We are, I believe, one of the first companies who have actually taken this from what was a very strong academic kind of research project onto this start-up ecosystem, but we're actually out there deploying it, running real world business, using a very purposeful and deliberate software-defined strategy. >> And it's interesting because you said before we got on camera that you guys are actually very active participants in the open source movement and development of this stuff. You're not just kind of a participant waiting in the wings for this stuff to get developed. >> I mean absolutely, and to me, that's one of the reasons which if you're serious about open source, you have to use it. You can't just talk about it. You can't just say it looks like a nice idea. You have to get out there and get your hands dirty and do it. But the other thing also is you have to contribute back. I think that's a big tenet of the open source community. And we all and certainly the company, we grew up and we've seen tech evolve through the ages. And a big part, especially in the last 10 years or so, has been the open source movement, and it's contributing back. It's one of the reasons I'm here. It's one of the reasons the conference organizers invited me, is to actually talk about how we use open source and software-defined strategy for our technology. >> That's cool. So where do you run this software? You run it in private cloud, public cloud? Do you guys build your own data centers? How do you run it? >> Quick history lesson and our quick history-- >> Let's back up. First off, where is Amadeus today for people that aren't familiar with the company? >> We are actually a 30-year-old company. We are celebrating our 30th birthday this year. The company was started in the late '80s as a consortium between four leading European airlines, Lufthansa, Air France, Iberia, and Scandinavian. So we started off, which was very typical at that time, as a mainframe shop, and that's where a lot of our core systems were built. We're a big provider of technology in general to the travel industry even though we were founded by airlines. So to put it in perspective, we carry about 95% of the world's scheduled commercial seats, airline seats, on our platform. >> 95%. >> 95%, so we work with the world's-- >> Are available to purchase. Obviously, 95% of the purchases don't go through your system. >> Right. They are available. They are used by over 90,000 travel agents, retail travel agents, corporate travel, online travel. And we work with over, like I said, 700 airlines, work for their inventory. So chances are if you travel on an airplane, very good chances that our software was used to make the reservation. We also have airline ID systems and hotel ID systems, and we work with the airports. And this is where we do departure control, flight management, baggage reconciliation, a lot of the back end processes. And we started the company, essentially runs as we write our own software. We are offered as a service from day one, so we are one of the oldest software service providers in the industry. And obviously, when we got started to do that, you had to own your own infrastructure. So we are pretty good at it. We have very strong kind of technical chops. We have a large data center outside Munich Airport and a bunch of smaller data centers all over the world. And what we're doing now is really very deliberately making the journey towards a cloud, both our private cloud, so taking our own infrastructure, virtualizing it, and making it available as a service for our own applications, and then where it makes sense, to leverage public cloud infrastructures where they are available. >> So different apps in different clouds, is that-- >> Different apps in different clouds based on customer preferences. The core reservation booking engines, they are in our own private cloud because we do have a lot of regulatory security, privacy considerations. So that stuff, we keep kind of close where we can keep a very watchful eye on it, but there are a lot of transactions we are also talking about. The volume of searches has grown up, right? Obviously, Google has seen a lot of search volume. If you look at our business, it used to be when you wanted to book a flight, you'd go to a travel agent and be able to look at a bunch of flight options and you'd pick one. About 20 years ago, you call it the look to book ratios. You'd look at 10 to 20 options and you'd book one. You want to guess what it is today? >> The look to book ratio was 20 to one. That's got to be way higher. That's got to be 80 to one. >> It's more like 1,000 to one. >> 1,000 to one. >> 1,000 to one. It's partly people like you and I who have a spare moment and have a vacation in mind, and we are looking at options. But keep in mind, anything that you search, it has to come into our systems. We have to configure the journey. We have to price it. We have to make sure it's available before we offer it up to you, right? So it's very transaction and computing intensive even before it touches any of the back ends where we do core kind of booking and passenger processing. And so to handle that scale, those are the kind of very logical applications that make sense for the public cloud. And those are the ones that we've looked to move. Certainly, for customers, we are a global company. We have customers all over the world. Some customers want to have some of these systems closer to their geographic location. So we look at all use cases kind of. >> That's amazing to think of. These things have so changed behavior and the way that we interact. I assume that 20 to one was a function because you would sit down. Now you sit down at your desk, time to book that flight, and maybe you don't get it done that day. You come back two or three times. But as you said, now it's grabbing little bits of time throughout the day whenever we can. But do you get paid on a regular subscription, or do you get paid on the transaction? Has that just increased your overhead, whatever the ratio 20 to 1,000 is? >> Absolutely, no, our business model has been very consistent from day one. We get paid on the number of bookings we make and the number of people that board aircraft, I mean roughly speaking. There are smaller lines of businesses, but those are our two main revenue drivers. So we see a lot of transaction volume upfront, but it doesn't translate to a booking which logically, it won't. Yes, that's noise or revenue for us, but we still have to service that volume because that's eventually, the funnels just gotten wider. And so it makes sense to do that in the most cost efficient manner but without compromising quality, without compromising speed. I mean if you're like me, if you have to wait for more than two or three seconds, you're like, "Ah, I'm moving on." >> Oh, two seconds. It's milliseconds, isn't it? >> Absolutely. >> And by the way, I still don't always find the flight I want. So where are those extra flights? Can you provide those for your service? >> Jeff: That extra 5% those are under. >> That's very different. It's got nothing to do with open source and kind of what we're talking about here, but a lot of what you're doing in there from an engineering perspective is just looking at, for example, machine learning algorithms. And what you said is actually a very common complaint, is how do I find kind of the right sort of flights. And more importantly, if you have certain preferences with airports or airlines or loyalty programs or time of day, how do I provide you context-sensitive results? We are doing a lot of kind of core R&D work for that, but our customers are doing amazing work as well. KAYAK is one of our customers, very close to our offices in the Boston area, and they do pretty amazing work in terms of getting their context right and then applying machine learning technologies and artificial intelligence. It's very, very early days but very exciting, very promising. >> One of the cool features I like are these fare alerts. I don't know if you use them. It tells you, it predicts this is going to go up. You better book now, wait. Do you guys do that sort of thing too? >> Our customers do that. We have a very simple model. Our customers are travel agencies, online, American Express, Expedia, metasearches like KAYAK, Skyscanner, et cetera, the airlines themselves whose products we host in our system and we sell. So a lot of our engineering work is learning to offering kind of core innovation so that they can offer products for people like you and me, their customers, the best products out there. So we focus on enabling them. And then at an operational level, we try to do it in the most efficient manner and the most future proof that we can think of. >> What about security? I mean it sounds like a lot of sensitive data changing hands here, right, where are people going to sit on an airplane, where are they going. You must have incredible security demands on your data now. >> Yes. (Jeff and Scott laugh) I mean you understand, obviously, it's paramount to us. And the good news is, look, we've been in this business for 30 years. We have really deep domain expertise in that. And also, you'll understand why I wouldn't want to talk too much about what we do and how we do it, but absolutely, that's one of the-- >> Scott: You just lock it down. >> Prime drivers of everything we think all the way from application design to things like the infrastructure planning and design to the physical level. I mean everything you can think of and probably a couple of things you may not think of. >> Hopefully a few things we didn't think of. So where do you go next? It sounds like you're enabling a lot of the innovation on your partner's side. You just mentioned KAYAK and people writing some of the machine learning and AI algorithms to help the end traveler find what they're looking for. Where are you guys concentrating? You said you've been at it for 30 years. What are some of the next big hurdles that you're looking to take down? >> It's wonderful, I think, being close to our customers. And one of the reasons I'm in Boston, we are a European company. We are actually headquartered in Madrid. Our core engineering team, our central engineering team is in France. The reason I'm in Boston and my team is in Boston is we've started doing a lot of business here in North America, and we try to stay very close to our customers. And when you listen carefully, and that's why we have two ears and one mouth is to hopefully try to listen a lot, you do see their pain points, you do see where they are going with kind of their business. And it gives us a chance to have a front row seat in designing new products that they can use. So to me, it's kind of two pronged. One is we want to offer the best technology we can to our customers at the best price point we can. And obviously, by now, you've figured out it's mission critical stuff has to always be on. Keeping those kind of boundary conditions in mind, you want to be the best technology provider, and then we want to innovate. So one of the things I'm seeing at this conference, there's a lot of friends from the service providers who are talking about 5G technology. And so with connected cars, with virtual reality, I mean these are all trends that are going to impact us as travelers in a positive way. And so we have a dedicated innovation team across all our business lines. We do a lot of work with academic institutions, with ETH in Zurich, with MIT here, close to my office in Boston. And there's just a chockfull of possibilities in terms of what can be done. >> All right, I'll give you the last word, impressions on the show. What do you get out of a show like this? Why is it important for you to come? >> It's amazing. I mean this morning, Martin Casado was there. He's called kind of the grand daddy of software-defined networking (mumbles). >> He's not that old yet, but he's going to like seeing that clip. (laughs) >> It's true. I read that at The Guardian. It was on one of the newspapers. But the fact is we used NSX for virtualization in our entire data center, and we have close to 20,000 infrastructure devices. All our computers are virtualized, 100% of it, and it's all using NSX from VMware, right? Now this was a sort of brilliant idea by an extremely intelligent and persuasive graduate student at Stanford 15 years ago that is, as he announced this morning, is a billion-dollar business today, right? And we are actually using the technology, and it's very real, to process all of this. So it's great to be able to see what people like him, I mean from Google, he's a great partner of ours. We use Kubernetes for kind of the container deployment strategy for our cloud network. We hear him speak about what they're thinking about in terms of investments and how the network is going to essentially drive the movement of data analytics. It's just phenomenal to get the top leadership. I'm obviously very honored and privileged to be presenting to this audience and to share our thoughts and what we're doing and just to see a lot of the buzz around here and what wonderful ideas are happening in the Valley. There's so much action, as always, going on. >> Great, great, great summary. Well, glad you could take a few minutes to stop by theCUBE. >> Completely my pleasure. Thank you very much. Great meeting you, and have a great rest of the show. >> All right. He's Rashesh, he's Scott, I'm Jeff. You're watching theCUBE from Open Networking Summit 2017 in Santa Clara. We'll be back after this short break. Thanks for watching. (upbeat electronic music) >> Announcer: Robert Herjavec. >> People obviously know you from Shark Tank, but The Herjavec Group has been really laser focused on cybersecurity. >> I actually helped to bring upon Checkpoint to (mumbles) firewalls, URL filtering, that kind of stuff. >> But you're also...