(upbeat music) >> From New York City, it's theCUBE. Covering "Welcome To The New Edge." Brought to you by Pensando Systems. >> Hey, welcome back here ready. Jeff Frick here with theCUBE. We are high atop Goldman Sachs in downtown Manhattan, I think it's 43 floors, for a really special event. It's the Pensando launch. It's really called welcome to the new edge and we talked about technology. We had some of the founders on but, these type of opportunities are really special to talk to some really senior leaders and we're excited to have John Chambers back on, who as you know, historic CEO of Cisco for many, many years. Has left that, is doing his own ventures he's writing books, he's investing and he's, happens to be chairman of the board of Pensando. So John, thanks for taking a few minutes with us. >> Well, more than a few minutes, I think what we talked about today is a major industry change and so to focus on that and focus about the implications will be a lot of fun. >> So let's jump into it. So, one of the things you led with earlier today was kind of these 10 year cycles and they're not exactly 10 years, but you outlined a series of them from mainframe, mini client server everybody knows kind of the sequence. What do you think it is about the 10 year kind of cycle besides the fact that it's easy and convenient for us to remember, that, kind of paces these big disruptions? >> Well, I think it has to do with once a company takes off they tend to, dominate that segment of the industry for so long that even if a creative idea came up they were just overpowering. And then toward the end of a 10 year cycle they quit reinventing themselves. And we talked earlier about the innovator's dilemma and the implications for it. Or an architecture that was designed that suddenly can't go to the next level. So I think it's probably a combination of three or four different factors, including the original incumbent who broke the glass, disrupted others, not disrupting themselves. >> Right, but you also talked about a story where you had to shift focus based on some customer feedback and you ran Cisco for a lot longer than 10 years. So how do you as a leader kind of keep your ears open to something that's a disruptive change that's not your regular best customer and your regular best salesman asking for a little bit faster, a little bit cheaper, a little bit of more the same versus the significant disruptive transformational shift? >> Well this goes back to one of my most basic views in life is I think we learn more from our setbacks or setbacks we were part of, or even the missteps or mistakes than you ever do your successes. Everybody loves to talk about successes and I'm no different there. But when you watched a great state like West Virginia that was the chemical center of the world and the coal mining center of the world, the 125,000 coal mines, six miners very well paid, 6,000 of the top engineers in the world, it was the Silicon Valley of the chemical industry and those just disappear. And because our state did not reinvent itself, because the education system didn't change, because we didn't distract attract a new set of businesses in we just kept doing the right thing too long, we got left behind. Then I went to Boston, it was the Silicon Valley of the world. And Route 128 around Boston was symbolic with the Silicon Valley and I-101 and 280 around it. And we had the top university at that time. Much like Stanford today, but MIT generating new companies. We had great companies, DEC, Wang, Data General. Probably a million jobs in the area and because we got stuck in a segment of the market, quit listening to our customers and missed the transitions, not only did we lose probably 1.2 million jobs on it, 100,000 out of DEC, 32,000 out of Wang, etc, we did not catch the next generation of technology changes. So I understand the implications if you don't disrupt yourself. But I also learned, that if you're not regularly reinventing yourself, you get left behind as a leader. And one of my toughest competitors came up to me and said, "John, I love the way you're reinventing Cisco "and how you've done that multiple times." And then I turned and I said "That's why a CEO has got to be in the job "for more than four or five years" and he said, "Now we disagree again." Which we usually did and he said, "Most people can't reinvent themselves." And he said "I'm an example." "I'm a pretty good CEO" he's actually a very good CEO, but he said, "After I've been there three or four years "I've made the changes, that I know "I've got to go somewhere else." And he could see I didn't buy-in and then he said, "How many of your top 100 people "you've been happy with once they've been "in the job for more than five years?" I hesitated and I said "Only one." And he's right, you've got to move people around, you've got to get people comfortable with disruption on it and, the hardest one to disrupt are the companies or the leaders who've been most successful and yet, that's when you got to think about disruption. >> Right, so to pivot on that a little bit in terms of kind of the government's role in jobs, specifically. >> Yes. >> We're in this really strange period of time. We have record low unemployment, right, tiny, tiny unemployment, and yet, we see automation coming in aggressively with autonomous vehicles and this and that and just to pick truck drivers as a category, everyone can clearly see that autonomous vehicles are going to knock them out in the not too distant future. That said, there's more demand for truck drivers today than there's every been and they can't fill the positions So, with this weird thing where we're going to have a bunch of new jobs that are created by technology, we're going to have a bunch of old jobs that get displaced by technology, but those people aren't necessarily the same people that can leave the one and go to the other. So as you look at that challenge, and I know you work with a lot of government leaders, how should they be thinking about taking on this challenge? >> Well, I think you've got to take it on very squarely and let's use the U.S. as an example and then I'll parallel what France is doing and what India is doing that is actually much more creative that what we are, from countries you wouldn't have anticipated. In the U.S. we know that 50% of the Fortune 500 will probably not exist in 10 years, 12 at the most. We know that the large companies will not incrementally hire people over this next decade and they've often been one of the best sources of hiring because of AI and automation will change that. So, it's not just a question of being schooled in one area and move to another, those jobs will disappear within the companies. If we don't have new jobs in startups and if we don't have the startups running at about three to four times the current volumes, we've got a real problem looking out five to 10 years. And the startups where everyone thinks we're doing a good job, the app user, third to a half of what they were two decades ago. And so if you need 25 million jobs over this next decade and your startups are at a level more like they were in the 90s, that's going to be a challenge. And so I think we've got to think from the government perspective of how we become a startup nation again, how we think about long-term job creation, how we think about job creation not taking money out of one pocket and give it to another. People want a real job, they want to have a meaningful job. We got to change our K through 12 education system which is broken, we've got to change our university system to generate the jobs for where people are going and then we've got to retrain people. That is very doable, if you got at it with a total plan and approach it from a scale perspective. That was lacking. And one of the disappointing things in the debate last night, and while I'm a republican I really want who's going to really lead us well both at the presidential level, but also within the senate, the house. Is, there was a complete lack of any vision on what the country should look like 10 years from now, and how we're going to create 25 million jobs and how we're going to create 10 million more that are going to be displaced and how we're going to re-educate people for it. It was a lot of finger pointing and transactional, but no overall plan. Modi did the reverse in India, and actually Macron, in all places, in France. Where they looked at GDP growth, job creation, startups, education changes, etc, and they executed to an overall approach. So, I'm looking for our government really to change the approach and to really say how are we going to generate jobs and how are we going to deal with the issues that are coming at us. It's a combination of all the the above. >> Yep. Let's shift gears a little bit about the education system and you're very involved and you talked about MIT. Obviously, I think Stanford and Cal are such big drivers of innovation in the Bay area because smart people go there and they don't leave. And then there's a lot of good buzz now happening in Atlanta as an investment really piggy-backing on Georgia Tech, which also creates a lot of great engineers. As you look at education, I don't want to go through K through 12, but more higher education, how do you see that evolving in today's world? It's super expensive, there's tremendous debt for the kids coming out, it doesn't necessarily train them for the new jobs. >> Where the jobs are. >> How do you see, kind of the role of higher education and that evolving into kind of this new world in which we're headed? >> Well, the good news and bad news about when I look at successful startups around the world, they're always centered around a innovative university and it isn't just about the raw horse power of the kids, It starts with the CEO of the university, the president of the university, their curriculum, their entrepreneurial approach, do they knock down the barriers across the various groups from engineering to business to law, etc? And are they thinking out of box? And if you watch, there is a huge missing piece between, Georgia Tech more of an exception, but still not running at the level they need to. And the Northeast around Boston and New York and Silicon Valley, The rest of the country's being left behind. So I'm looking for universities to completely redo their curriculum. I'm looking for it really breaking down the silos within the groups and focus on the outcomes. And much like Steve Case has done a very good job on focusing, about the Rust Belt and how do you do startups? I'm going to learn from what I saw in France at Polytechnique and the ITs in India, and what occurred in Stanford and MIT used to occur is, you've got to get the universities to be the core and that's where they kids want to stay close to, and we've got to generate a whole different curriculum, if you will, in the universities, including, continuous learning for their graduates, to be able to come back virtually and say how do I learn about re-skilling myself? >> Yeah. >> The current model is just not >> the right model >> It's broken. >> For the, for going forward. >> K through 12 is >> hopelessly broken >> Yeah. >> and the universities, while were still better than anywhere else in the world, we're still teaching, and some of the teachers and some of the books are what I could have used in college. >> Right, right >> So, we got to rethink the whole curriculum >> darn papers on the inside >> disrupt, disrupt >> So, shifting gears a little bit, you, played with lots of companies in your CEO role you guys did a ton of M&A, you're very famous for the successful M&A that you did over a number of years, but in an investor role, J2 now, you're looking at a more early stage. And you said you made a number of investments which is exciting. So, as you evaluate opportunities A. In teams that come to pitch to you >> Yeah. >> B. What are the key things you look for? >> In the sequence you've raised them, first in my prior world, I was really happy to do 180 acquisitions, in my current world, I'm reversed, I want them to go IPO. Because you add 76% of your headcount after an IPO, or after you've become a unicorn. When companies are bought, including what I bought in my prior role, their headcount growth is pretty well done. We'd add engineers after that, but would blow them through our sales channel, services, finance, etc. So, I want to see many more of these companies go public, and this goes back to national agenda about getting IPO's, not back to where they were during the 90's when it was almost two to three times, what you've seen over the last decade. But probably double, even that number the 90's, to generate the jobs we want. So, I'm very interested now about companies going public in direction. To the second part of your question, on what do I look for in startups and why, if I can bridge it, to am I so faired up about Pensando? If I look for my startups and, it's like I do acquisitions, I develop a playbook, I run that playbook faster and faster, it's how I do digitization of countries, etc. And so for a area I'm going to invest in and bet on, first thing I look at, is their market, technology transition, and business model transition occurring at the same time. That was Amazon of 15 years ago as an example. The second thing I look at, is the CEO and ideally, the whole founding team but it's usually just the CEO. The third thing I look for, is what are the customers really say about them? There's only one Steve Jobs, and it took him seven years. So, I go to the customers and say "What do you really think of this company?" Fourth thing I look for, is how close to an inflection point are they. The fifth thing I look for, is what they have in their ecosystem. Are they partnering? Things of that type. So, if I were to look at Pensando, Which is really the topic about can they bring to the market the new edge in a way that will be a market leading force for a whole decade? Through a ecosystem of partners that will change business dramatically and perhaps become the next major tech icon. It's how well you do that. Their vision in terms of market transitions, and business transitions 100% right. We've talked about it, 5G, IOT, internet of things, going from 15 billion devices to 500 billion devices in probably seven years. And, with the movement to the edge the business models will also change. And this is where, democratization, the cloud, and people able to share that power, where every technology company becomes a business becomes a, every business company becomes a technology company. >> Right. >> The other thing I look at is, the team. This is a team of six people, myself being a part of it, that thinks like one. That is so unusual, If you're lucky, you get a CEO and maybe a founder, a co-founder. This team, you've got six people who've worked together for over 20 years who think alike. The customers, you heard the discussions today. >> Right. >> And we've not talked to a single cloud player, a single enterprise company, a single insurance provider, or major technology company who doesn't say "This is very unique, let's talk about "how we work together on it." The inflection point, it's now you saw that today. >> Nobody told them it's young mans game obviously, they got the twenty-something mixed up >> No, actually were redefining (laughs) twenty-something, (laughs) but it does say, age is more perspective on how you think. >> Right, right. >> And Shimone Peres, who, passed away unfortunately, two years ago, was a very good friend. He basically said "You've got all your life "to think like a teenager, "and to really think and dream out of box." And he did it remarkably well. So, I think leaders, whether their twenty-something, or twenty-some years of experience working you've got to think that way. >> Right. So I'm curious, your take on how this has evolved, because, there was data and there was compute. And networking brought those two thing together, and you were at the heart of that. >> Mm-hmm. Now, it's getting so much more complex with edge, to get your take on edge. But, also more importantly exponential growth. You've talked about going from, how ever many millions the devices that were connected, to the billions of devices that are connected now. How do you stay? How do you help yourself think along exponential curves? Because that is not easy, and it's not human. But you have to, if you're going to try to get ahead of that next wave. >> Completely agree. And this is not just for me, how do I do it? I'm sharing it more that other people can learn and think about it perhaps the same way. The first thing is, it's always good to think of the positive, You can change the world here, the positive things, But I've also seen the negatives we talked about earlier. If you don't think that way, if you don't think that way as a leader of your company, leader of your country, or the leader of a venture group you're going to get left behind. The implications for it are really bad. The second is, you've got to say how do you catch and get a replicable playbook? The neat thing about what were talking about, whether it's by country in France, or India or the U.S., we've got replicable playbooks we know what to run. The third element is, you've got to have the courage to get outside your comfort zone. And I love change when it happens to you, I don't like it when it happens to me And I know that, So, I've got to get people around me who push me outside my comfort zone on that. And then, you've got to be able to dream and think like that teenager we talked about before. But that's what we were just with a group of customers, who were at this event. And they were asking "How do we get "this innovation into our company?" "How do we get the ability to innovate, through not just strategic partnerships with other large companies or partnerships with startups?" But "How do we build that internally?" It's comes down to the leader has to create that image and that approach. Modi's done it for 1.3 billion people in India. A vision, of the future on GDP growth. A digital country, startups, etc. If they can do it for 1.3 billion, tell me why the U.S. can not do it? (laughs) And why even small states here, can't do it. >> Yeah. Shifting gears a little bit, >> All right. >> A lot of black eyes in Silicon Valley right now, a lot of negativity going on, a lot of problems with privacy and trading data for currency and, it's been a rough road. You're way into tech for good and as you said, you can use technology for good you can use technology for bad. What are some things you're doing on the tech for good side? Because I don't think it gets the spotlight that it probably should, because it doesn't sell papers. >> Well, actually the press has been pretty good we just need to do it more on scale. Going back to Cisco days, we never had any major issues with governments. Even though there was a Snowden issue, there were a lot of implications about the power of the internet. Because we work with governments and citizens to say "What are the legitimate needs so that everybody benefits from this?" And where the things that we might have considered doing that, governments felt strongly about or the citizens wouldn't prosper from we just didn't do it. And we work with democrats and republicans alike and 90% of our nation believed tech was for good. But we worked hard on that. And today, I think you got to have more companies doing this and then, what, were doing uniquely in JC2, is were literally partnering with France on tech is for good and I'm Macron's, global tech ambassador and we focus about job creation and inclusion. Not just in Paris, or around Station F but throughout all the various regions in the country. Same thing within India, across 26 different states with Modi on how do you drive it through? And then if we can do it in France or India why can't we do it in each state in the U.S.? Partnering with West Virginia, with a very creative, president of the university there West Virginia University. With the democrats and republicans in their national senate, but also within the governor and speaker of the house and the president and senate within West Virginia, and really saying were going to change it together. And getting a model that you can then cookie cut across the U.S. if you change the curriculum, to your earlier comments. If you begin to focus on outcomes, not being an expert in one area, which is liable not to have a job >> Right. >> Ten years later. So, I'm a dreamer within that, but I think you owe an obligation to giving back, and I think they're all within our grasps >> Right >> And I think you can do, the both together. I think at JC2 we can create a billion dollar company with less than 10 people. I think you can change the world and also make a very good profit. And I think technology companies have to get back to that, you got to create more jobs than you destroy. And you can't be destroying jobs, then telling other people how to live their lives and what their politics should be. >> Yeah. >> That just doesn't work in terms of the environment. >> Well John, again, thanks for your time. Give you the last word on >> Sure >> Account of what happened here today, I mean you're here, and Tony O'Neary was here or at the headquarters of Goldman. A flagship launch customer, for the people that weren't here today why should they be paying attention? >> Well, if we've got this market transition right, the technology and business model, the next transition will be everything goes to the edge. And as every company or every government, or every person has to be both good in their "Area of expertise." or their vertical their in, they've got to also be good in technology. What happened today was a leveling of the playing field as it relates to cloud. In terms of everyone should have choice, democratization there, but also in architecture that allows people to really change their business models, as everything moves to the edge where 75% of all transactions, all data will be had and it might even be higher than that. Secondly, you saw a historic first never has anybody ever emerged from stealth after only two and a half years of existing as a company, with this type of powerhouse behind them. And you saw the players where you have a customer, Goldman Sachs, in one of the most leading edge areas, of industry change which is obviously finance leading as the customer who's driven our direction from the very beginning. And a company like NetApp, that understood the implication on storage, from two and a half years ago and drove our direction from the very beginning. A company like HP Enterprise's, who understood this could go across their whole company in terms of the implications, and the unique opportunity to really change and focus on, how do they evolve their company to provide their customer experience in a very unique way? How do you really begin to think about Equinix in terms of how they changed entirely from a source matter prospective, what they have to do in terms of the direction and capabilities? And then Lightspeed, one of the most creative intra capital that really understands this transition saying "I want to be a part of this." Including being on the board and changing the world one more time. So, what happened today? If we're right, I think this was the beginning of a major inflection point as everything moves to the edge. And how ecosystem players, with Pensando at the heart of that ecosystem, can take on the giants but also really use this technology to give everybody choice, and how they really make a difference in the future. As well as, perhaps give back to society. >> Love it. Thank you John >> My pleasure, that was fun. >> Appreciate it. You're John, I'm Jeff you're watching theCUBE. Thanks for watching, we'll see you next time. (upbeat music)

>> from the Silicon Angle Media Office in Boston, Massachusetts. It's the cue now Here's your host Day Volonte. >> Hi, buddy. Welcome to the Special Cube conversation. My name is David Dante, and this is our series on partners. How partners and the Channel is adding value to help customers create business capabilities in this digital world. I'm here with John Barker, and he is the co founder and CEO of a company called Versatile Local New England partner of H P Ease. This is sponsored by HP and versatile John. Welcome to the Cube. Thanks for coming >> on. Well, thanks, David. Appreciate you having me here today. >> So tell us more about versatile. You've been business for a couple of decades. Plus, you have, ah, deep background. Tell us about versatile and your background. >> Your, uh, be happy to do that versa was found in 25 years ago. Said 25th anniversary and I probably would be lying if I didn't tell you. I probably would've been out of this business 25 years later, but it's a great business. It was fun about my partner and I, Kevin Meaney, like a lot of those stories have started on a picnic bench in a basement. Actually, so we've grown the company over the years. I think one of the things that's important, I have something important to our customers always had a great basin infrastructure. We've always had a great deal of engineering support from our company. From a company perspective, we feel like it was 25 years ago today. Making sure you've got a complete infrastructure in place for our customers is very important that you can layer on top of those applications that those customs need to run their business. >> Well, you've seen the waves. I mean, we kind of started in the business around the same time, and we sort of we watched that PC era when everything was PC centric. It was all about personal productivity. And we saw the Internet wave. And obviously, now you know, the cloud has been this huge disrupter. And now we've got this digital wave. What are the big trends that you're seeing in the marketplace with your customer? >> Well, clearly, you know, Cloud is not new in anywhere. It has certainly been here for several years now, but in a lot of cases, they're they're they're certainly companies were born in the clown who have gone there 100% right out of the gate. But in a lot of cases are more traditional business. A lot of our customers are taking steps to get there or to build further down there, take advantage of what can be some certainly cost saving opportunities, some convenience aspects associated with the cloud. But I think from a customer's perspective, there's a lot of new technology out there, and not that it wasn't true 10 years ago. But there's so much to understand and understand what makes the most sense for my firm. Might my operation. Can I securely move to the club, right? Can I can I adequately support all of my customers? And I think that's really where a lot of customers are at. They're really looking for guidance. They're trying to understand what all the choices are. How do I move there and who can help me get there? >> Yeah, and the pendulum swings. I mean, after the you know the dot com bust, everybody was focused on cutting costs. You know, the post wide to K of situation. It feels like now people are trying to figure out. How do I get competitive advantage? They C i t. And data a differentiator, and they don't want to get disrupted. They don't want to get uber rise. That's kind of the bromide. Presumably, you see that as well. How our customers looking at that cloud, both public cloud and hybrid cloud as a differentiator. Are they looking at it to cut costs? Are they looking at it, too? Support new APS and be more agile. What are you saying? >> I think it's a lot of those things, you know, I think throughout our history it was all about putting that kind of base infrastructure together and storing a lot of data in a lot of places, making sure it's secure to have a have a proper disaster recovery plan in place. There wasn't a whole lot of thought back then. What is all this data we're storing and how do we take advantage of it? That clearly is changing, right. So with the advent of analytics, we happen to a lot of work in the health care space, which really there's a treasure trove of data out there to kind of help in that space. I think It's from a health care perspective. Technology will be the savior. Despite the fact that I think most doctors certainly conditions that you would talk to you today, almost look at this a burden and that needs to change needs to move forward. >> Well, health care is a real challenge. I mean, obviously you have, you know, hippa considerations. You've got all its highly regulated industry. As you point out, docks have never really embraced technology in a big way. But now you've got you got machine to machine intelligence. You got all kinds of embedded stuff and medical devices, and I think doctors are realizing that while machines can actually help us make better diagnoses, and it's an industry that's ripe for disruption, it really hasn't been heavily disrupted yet. But it's coming, isn't it? >> Definitely is coming on Dhe and again, she only at the hospital level. I think that they're a little bit ahead of the game in terms of how they manage their resource. Is the data the applications down the clinician level? You know much like yourself. I'm sure if you had to visit it, I had an issue related to some kind of elements or injury. A lot of it's not going to hospitals anymore. We're going to clinics. Minute clinics were going to see our doctors and a lot of cases. Those facilities haven't necessarily benefited by technology refreshes over over the last several years. And so they're really right to come into the kind of the 21st century here, along with things like Tele Medicine. So you talk about from a physician standpoint who struggled with just any HR application, which continues to be somewhat of a burden for a lot of folks. Now they've got compliancy issues they need to worry about. They've got to be offering new service is to their customers into their patients like telemedicine creates. Even Maur issues on the back end. From a data perspective, storage perspective, compliance, accessibility and ease of use don't necessarily go together, right? Tough balance, right? And so I think that, you know, from an enforcement perspective, it's only really starting to start in the health care space where is maybe the commercial? Certainly the financial markets have had no choice over the last 10 to 12 years to really hard down their facilities, their applications and their access to data. This is a whole new challenge for the health care space to tackle here. Going forward. >> So versatile are experts at at infrastructure and architecture and architectures obviously changed a lot over the past 25 years, right? Usedto have a nap. And you, you'd put down infrastructure might have been, you know, Unix or a V M s or whatever it was. You build a hardened system around that security and boom. There was your your stovepipe. It worked. It was rock solid. How are architectures, you know, changing today? How would you describe that today? Today's architecture? >> Well, way we do a lot of work with Hewlett Packard Enterprise. We've been a platinum partner. There's for close to 20 years. And so we certainly gotten very engaged with them on their product sets around how they could manage data and certainly in the storage space around their intelligence data platform, which makes ah great deal of sense for us for our customers. We do several things in terms of how we manage data. We also do private cloud hosting for medical applications use. You know as well as we obviously put together solutions for our customers to be in the club, and so making sure that we're securing those those platforms in >> putting the proper >> infrastructure in place from storage perspective from a compute perspective than honesty from a network accessibility perspective is really, really quite important. I think in a lot of cases, both commercial and in the healthcare space especially there are so many new technologies that can saved customers money and provide better security over what they may have been doing in the past and sometimes in health care is not alone. Some of those changes are taking longer than they probably should. And that kind of the promise of what technique you can do to get to deliver to those verticals is here. It just takes a great deal of time to some degree to sit down on. The customers have to understand what your options are. What makes the most sense get them comfortable, obviously that the decisions they make the date is gonna be available, it's gonna be secure. It's gonna be easily accessible. >> So you guys come in with a holistic whole house view, obviously, so you're trying to help a customer achieve an outcome. So my question is what are you looking for? From, Ah, storage system partner. What? What's the ideal storage infrastructure? What do you need from storage? >> Sure. I mean, really, I think Intelligent analytics, which is really obviously something that Hewlett Packard enterprise has been, has really come on strong with especially were initially engaged with that animal product line. Which is to say that the machine itself is starting to take care of a lot of the things you would expect for your I t. Folks to have tea, either worry about or manage on. I think, part of the problem for all our customers. There's so many data points now. We talked a little bit earlier about the fact that the coyote is everywhere, whether it's commercial or in health care. You've got all sorts of devices. Now they're on the network that are providing some level of data back somewhere. How do you manage all that? And I think with info site tools from from HP Enterprise in the storage side, you're starting to get some analysts that they're taking it a much more proactive look at what the infrastructure is doing. Potential issues where you can make intelligent changes to improve performance obviously keep things secure. Those kinds of technologies really are gonna be the I think that a bit of the hope for if you will, whether it's health care, commercial, the amount of one I t cost I t personnel, they're very expensive. Obviously those resource is. And so if you could get intelligent deployments of solution, she's like that, then it can kind of take a huge bird. Enough of the I T department. They could go about working on project worked to a to a man to a woman. All the customers that we work with always feel like they're spending too much time kind of managing their infrastructure on. I do think that we're finally getting to the point where we've got tools that can help us really do that and reduce the amount of effort and somewhat costs that goes into that. ONDA also allow those resource is to start to work in the more strategic projects for the company's right. You know where the activity should be spent trying to either improve patient care and the health care side improved profitability in the commercial space. This is really you know, this is groundbreaking kind of tools that we just haven't seen in this industry. >> Yeah, this is key. I mean, 10 years ago, people were afraid a lot of this automation, I often joke, but it's really not a joke. If your expertise is managing lungs, you probably want to rethink your career. And so but But again, 10 years ago, people were afraid that that the automation was gonna take their jobs. We think today they realized, Wow, this train of digital transformation is left the station, and they want to shift their activities from things that air, not adding value to the business to your point, things that are more strategic. So from an infrastructure standpoint, how are you helping customers? You achieve those outcomes? >> I think from our perspective, we take a very consultative approach, right? And often times I think sometimes you can't see the forest through the trees. And a lot of these organizations, right? The too busy in their day to day jobs, trying to manage the day to day efforts to actually take a strategic view of you know what I got here? How do I improve all this? What kinds of technology should I really be? looking at, I think it's almost impossible, right? You know, we had a lot of very high end engineers who a lot of cases, wouldn't be comfortable going to a small or medium business to spend their career there because it would be that only set of infrastructure they would set up and then manage right. It becomes boring for those guys. A lot of cases, a lot of the ways that we've been able to retain our talents because we're looking at noon challenges every day. New companies with new challenges for for, for their corporations, for their health care organizations to kind of understand one of the issues. How do we come up with some solutions? How to implement a phased approach to get them where they need to be? >> You're talking really about your partnership with HP Previously, HP What is it about that partnership that is unique? How do you guys differentiate in the marketplace on why HP? >> Well, I think for us it was an easy decision. You know, HP Enterprise has always been very partner friendly, which is important. We've worked together for about 20 years on dhe, certainly from a technology perspective and I think for our customers there's a bit of leapfrogging that goes all of all of these vendors, right? So to some degree of somebody might have the best d'oh gizmo for this year, and someone's gonna have something six months later. But there's consistency there. The strategic kind of view of of how they see the world unraveling and how we how we support I t going forward is really, I think, a notch above some of their competitors. I think hybrid is very important. Everybody you know, I mentioned early there, some certainly some companies that make sense that could really almost go completely club. But in most cases, it's just not possible several several certainly of our customer base. That is not gonna be comfortable ever to some degree putting everything in the cloud, but the ability to take advantage of the cloud and keep their their some of their I p, if you will locally to them make some sense. And so I think, you know, for for hybrid cloud in hybrid storage and compute HPD really got advance HB Well, >> in a lot of that to John, I think, is bringing the cloud operating model to your data wherever it exists, especially in health care. People aren't just gonna throw all the healthcare data into the cloud. I mean, there's so many issues they're not, not the least of which is. There's a lot of data on Prem that you just don't want to move into the clouds. Too expensive is too time consuming. So then to me and I look youto comment on this, a lot of that is around the simplicity of managing that infrastructure and three part kind of years ago said a gold standard on simplicity. And now Nimble comes in with a lot of intelligent automation. Your thoughts on being able to bring that cloud model to on Prem or in a hybrid situation, Is that a sort of valid way to think about? >> Oh, absolutely, I think it is. And I think again I go back to health care a little bit. But every 18 months there's storage requirements double on top of that because of compliancy issues, they have to hang on to the data indefinitely. I mean, that's gotta be a frightening aspect for any storage manager who's trying to manage Ah health care organization, a large health care organization. I need to hang on absolutely everything. Email all my files. It's not 10 years, 15 years, it's indefinitely. So that's a a major, a major undertaking in terms of Hattaway. Manage all that, right? So So H P certainly got an array of ways. Thio help with that, whether it's all flash right for the applications that require that kind of speed, this multi multi layers of storage of deployment, backup solutions, right and D r options that obviously a lot to take advantage of cloud where it makes a lot of sense. So there's a multitude of things that they need to think about on. I do believe HP is addressing those quite well. >> How are you changing the way in which you're hiring people today versus you know of 10 15 years ago? What's the skill set profile today? >> It really has changed and, you know, as we talked about earlier, we've been in business for 25 years, and and I think our ability to stay in business for that long has really been our ability to adapt and change on your right. You are hiring practices and who we hire is very different than it was maybe even five years ago. Where I've got to get cloud level architects involved. Expensive but very worthwhile resource is to be able to help customers with all of this. I do think what we get to deliver to our customers, the fact that we've got a multitude hundreds and hundreds of customers and experiences that go along with that that we could bring to the table it just couldn't possibly do in their own. It's quite impossible mission in the largest of the largest organizations. You're not going to expose the kinds of challenges in putting together kinds of solutions that gonna solve customers problems without doing that. So it's been quite a different higher than it has been in the past. >> My last question for you. Think of a healthcare use case or any any customer. So they're struggling. They've got, you know, everybody's got budget constraints. The market's moving super fast. You got this cloud thing coming, Adam The edge I ot you know, machine intelligence A. I a same time they they've got an existing business to runner and 80% of their time, and their investment is on keeping the lights on. We hear that all the time. What's your advice to the customer? I'm sure this is a common story. They want to go from point A to point B transformed their business. They don't want to go broke doing it. They might not have. The resource is so what do you D'oh, How would you advise them? >> Well, look, I think and we struggle like a lot of use. A lot of partners in this world in this country, right? Even in this region. And so trying to differentiate yourself. And we like to think that we're better than everybody else and so does the other two or 3000. Probably surrounded here in the 50 mile radius is really do need to find a trusted advisor that can help you through that. I think one of the places that we start there are there's opportunity to get some fairly immediate return on investment. I think that's important because to your point there were challenges, their their budget constraints. How am I gonna do all that? That those two things kind of go in two different directions. But there are many of our customers, really, Whether it's in health care and even the commercial side who may be doing some old things, some old I t. Things that could be replaced, including the cloud in terms of how they may be. They may be using an old disaster recovery of method, right that you're paying a lot of money for lease lines. It's really kind of a cold site, you know. They might go there once a year to try to see if they can recreate all their applications and get the thing up and running. There's clearly a cloud opportunity in there to save them. >> A lot of money >> reinvest that. Maybe not sit on idle equipment that obviously costs money is under some kind of maintenance, and you need to obviously resource to sport that. So I think that's a good conversation. When you guys get in with a customer and start to talk about Look, there's probably some areas here. We could save you money. So, yes, we're gonna charge you some money to get there. But the return on that is gonna be gonna be much better than where you want today. >> I love that answer. So look, look for quick hits. Try to demonstrate some some savings and generate some cash. If you will think like a business person, use that as a gain share approach. Maybe go to the CFO and say, Hey, if we can save this money can be reinvested in innovation. Drive more business value than you get that flywheel effect and you can build up credibility in your organization. And that's how you get from Point A to point B. Without going broke, he actually can make money for the organization that >> absolutely it's a very good point because, you know, we talked about earlier. You know, I t has been under constraint for quite a while, right? And so again, back to the ability for those people to think and have enough time to get into shitty strategic conversations all by themselves. It's difficult, if not impossible. So they need. They need help, They need consultants and they need trusted advisors. But obviously you need to prove your worth. I do think if you could start someplace where you can demonstrate Look, we could save you some real money here over the next year. 18 months, Two years is a great place to start. >> John, thanks so much for coming in and sharing your insights and best of luck out there. >> Well, thank you. I appreciate it very much. >> You're welcome. All right. Thank you for watching everybody. This is Dave Volante with the Cube. Will see you next time.

live from Las Vegas it's the queue covering del technology's world 2019 brought to you by Dell technologies and it's ecosystem partners hey welcome back everyone cubes live coverage day three of three days of wall-to-wall coverage got two sets exploding the content out there the cube can and we've been calling it so much content coming in I'm John Fourier your host with mykos de Villante we're Tom sweet is the CFO of Dell Technologies he's the man who's making it all happen all the numbers are starting to come in we're starting to see some real big numbers and more welcome to the Q thanks for spending the time hey I'm happy to be here it's great to see you guys again and it's been a great three days here at Deltek world so I'm very excited about what we're seeing all of the enthusiasm by with our customers and partners and the receptivity to what we're doing as a company and the capabilities we're driving is pretty exciting it's kind of like the postgame show I guess the show's going to end today but I've been watching you and the analysts giving all the presentations you're what we call a Czech athlete you got a you got to hold the ship down make the numbers work you got a lot of great puzzle pieces that you know you guys have laid out here at the show across the portfolio aggressive new architecture around end-to-end operations a lot of moving parts being integrated in and the numbers are looking really good a scoreboard looks good give it take us through the highlights of inside the numbers up into the right give us the highlights well you know thank you for that but it's been we had a great fiscal 19 as you guys know by now right so 90 over 91 billion dollars of non-gaap revenue we added 11 billion dollars of revenue in the year or so if you think about that that's the equivalent of a couple of Fortune 500 companies coming into the company you know took share in all the categories that were focused on you know we took over 320 basis points of share and storage I mean over 200 basis points of share and main stream server revenue you know our PC client commercial clients you took over I think a couple hundred basis points this year so we're very pleased with the progress but I think what's most exciting as we think about value creation we're headed as a company is some of the things that we announced this week around the cloud platform and what you're beginning to see is the fill in of the capabilities and the tie together of the companies that are coming together with integrated solutions and capabilities and so you know I've been with the analyst and as you referenced and they had lots of good questions on how does this all fit together how does it then what's the acceleration point if you will how does this take off from here and you know so work and so we went through that in terms of let's put the platform out there let's begin to build on it you know customers are asking for that multi cloud capability this is what this does for them it ties this together and one single pane of glass from an orchestration and management perspective so we're really excited and then you know you saw Jeff introduce a bunch of new products the new latitude line some of the new server capabilities new storage arrays that are coming and so you know customer the buzz here is pretty strong so it's been pretty exciting this we congratulations on just a shareholder value I know from a numbers standpoint it's really been successful congratulations the question I want to ask you going back I remember the conversation you know HPE got smaller HP Enterprise got smaller Dell was getting bigger and the conversation at that time was scale as a competitive advantage and we were talking about how cloud was showing the way that scale actually has these synergies as you look back now and as the evolution started you guys start executing we was the the first sign of wow this is gonna be awesome well probably Michael was more optimistic about it than I was figure out how to pay for it come on that's a lot of money you know so but look I mean I think what we saw when we when we came together as with Dell and EMC was the fact that he come we needed each other right we had capabilities that didn't overlap they gave us great presence and technology in the data center and clearly they have brought VMware and pivotal with them we brought scale we brought maybe an execution framework and a focus and the combination of the has been pretty powerful and look I mean it's taken a couple of years of heavy lifting right but and we're not done and there's lots to go do but I think we're pretty excited about how this started to accelerate on us you know or pick up momentum I should say you know middle last year does it margin expansion or is it to go to market efficiency or supply chain all three I think it's all three right if you listen to us over the last couple years we talked about hey we needed to invest we had to invest in new capabilities from a solution perspective we had to invest in go to market coverage you know so we've spent a fair amount of investment dollars putting you know putting the pieces in place and so then it takes time for that to come together and coalesce and I think we're early innings on that you know you know lots of competition out there but we're excited about the positioning right now so the numbers are pretty remarkable I mean to be a 90 billion dollar company growing it you know 14 percent it's pretty amazing however you know this if you take VMware's market cap to multiply it by 0.8 which is your share subtract out your core debt you know subtract out your market cap you're left with like a billion dollars is that really how we should think about the core Danelle is worth about about a billion dollars you know it's you're now getting to where I spent all my last year talking about valuation right but look I we obviously think differently about the value of the core company you just think about free cash flow coming out of the core which is over you know two and a half to three and a half billion dollars sort of three and a half billion dollar range I mean how quo the valuation framework in some instances doesn't make a lot of sense we understand that you know we're a large-scale tech company and tech investors in general haven't been you know exposed to companies with tech companies with a lot of debt right and we have more debt than the average I think it's very manageable because what's the opposite side of of you know the other side of the conversation on debt is what your EBIT are right so you think about moldable and and so look we think look I can't art I can't win those arguments as you know right around I think what we have to do is continue to go execute the business over time and I think you've you know that will demonstrate the value creation opportunity that exists here and you know people will decide whether they want to invest in us and come along with it or not well I've said it's a really cheap way to own VMware I mean if you really look at no way don't do the EM we're so there is that play one of the things that I've been really impressed with this week is your emphasis on growth but profitable growth you're not just going for market share for market share sake you got but but you are going hard for market share it's an interesting balance how do you balance those two oh it's sort of this constant juggle right because look I mean you think about where we compete PC server external storage we can talk Software Defined and some of the other dynamics that are going on but those mark those areas are generally not double-digit growth areas right and so if you're going to grow you're generally taking share from somebody right and so we had this philosophy in these types of areas we got to grow and it's got to be profitable to your point and in these spaces you can go out and get a lot of market share that's doable but you can also spend a lot of money doing that right you can you can rent share so to speak if you want it and so there's this balance of pushing the team's on go grow I want it to be the right kind of growth which means what does that mean it means you go acquire customers that have a value stream associated with them and yes you may be aggressive to go get them but over time you build that cape you build the ecosystem around them in terms of the other solutions and capabilities they're buying and so it's this constant balance you know and so that's what we're we're trying to make sure we get right if you will yeah one more CFL question if I may and then we can talk about more fun stuff so it talks about the debt yeah I think you got that covered you've managing that very well you know we talked about the valuation fine one of the areas that that I have some concerns about I'd like your responses just the PC business itself it's a very important business for you guys yeah it's it's about half the revenue maybe it's not as profitable we know that but it also absorbs a lot of overhead of the company so big shifts in that business would have tectonic effects I would think on your business how do you think about that how do you manage that I wonder if I haven't heard much talk about that and I just wonder if you could you know educate CSG business which is our PC business we've got forty three billion dollar business last year so you're right it provides us great scale by the way and great supply chain scale but if you if you think about what's driving the PC Renaissance right now there's a Windows 10 refresh going on as you both know and you know Microsoft's estimate would be hey you got to probably another year or so that left and then you got through most of that refresh cycle and then the question I always get to your point is what's next yeah and then I'm good some let me pivot the conversation which is if you think about what's next is the feedback we're now getting when you think about the workforce and the generation that's in the workforce now wants good technology and so the days of let me give all of my employees and team members these $400 $500 thick pcs that wait eight nine ten pounds are gone companies want employees want technology that they can carry that they like that's usable you know the whole flexible workforce dynamic and so there's a whole conversation around workforce transformation that's happening the other thing is you you hear us talk about edge to quarter cloud that edge computing dynamic which is will include both data you know infrastructure and hard PC hardware at the edges an interesting dynamic so we think the evolution continues to evolve and the PC business stays healthy for us but yes you're right it's a big business but it's a great cash flow built at the same time if that if John if that edge becomes a tailwind for you guys I mean essentially there's an oligopoly Michael Michael is all Michael was saying the edges where the games going to be in ten years I would just iterate add one thing to your comment about the client businesses I think one i 100% agree I think the Alienware booth here is a canary in the coal mine if you talk to any of the younger generation gamers they have this phrase called pcmr which stands for PC master-race there's a shift back to the PC because of gaming mm-hm and they all want their rigs and they want horsepower they're into the tap yeah so the ease of use and simplifying the tech they want the best graph they want rate racing they want I mean they want all these new things so I think there's a whole nother generation to your point anyway back to my question on this a business model issue is that Michaels on yesterday said we're not in the headline in Silicon angle right now says we're not a conglomerate Michael Dell savers the integrated pieces of his growing company so I gotta ask you you know in in the intersection of innovation strategy business model innovation and financial and strategy you gotta have a financial strategy at overlays innovation strategy as well as the business model how would you describe the financial strategy of Dell technologies and how does that overlay directly on top of the innovation strategy and the business model look alright smile to man job is to help Michael to build his vision and fulfill his vision the subset of that is what's the job of a what what does a company do it's all about creating value and shareholder value so the overall a financial strategy and framework is shareholder value creation right and you step down from that you say how do you create value you create value these would be better capabilities better products and solutions how do you do that then you get into a capital allocation conversation on how much am I going to allocate of my capital to innovation to R&D how much a value creation is going to come through debt pay down to your point you know if you look at the levers we're pulling right now and how and simplified capital structures I should also say so the leaveners we're pulling right now are all those levers right we're pulling a let me build the innovation the integrated capabilities this concept of it we've got great capabilities across the family of Dell technologies how do we integrate them how do I create solutions that you customers want at the same point in time I'm pricing those effectively I'm creating cash generation that allows me to reinvest in the business and also pay down debt that ultimately drives shareholder value right yeah and this conglomerate come I thought was relevant because I don't see you as a conglomerate if you look at the success of say Amazon Web Services as part of Amazon almost half their revenues now that's one large distributed computer basically I mean it's integrated parts of a lot of things as an operating environment operating system so you've said on the cube that is a model you guys have a similar approach you're looking at the holistic picture of Dell technologies as an operating model with synergies and systems not this divisions pumping out all this cash they're siloed it's the integrations of key part comment on that piece yeah look I mean you know I've we've been we've been having this pushing on this conglomerate thing now for awhile right in the sense up we've got certain investors in certain analysts and that think about well you've got all these piece parts in you but these piece parts don't run independently they're integrated what we're using joint selling activity joint solution capability and development to sell to we sell technology right I'm not selling engines and lightbulbs and appliances right I'm selling technology to a set of buyers that are consuming that technology in an integrated fashion and that's how we're going to market and that's how we're building solutions to them and so look we're gonna you're going to continue to hear us push on that theme because I think it's an important theme that people need to understand about what we're trying to do but you know and so work that drives evaluation conversation which has been you know Andy jassie CEO of Amazon told me once on the queue you gotta be able to myth being misunderstood for a while before people figure it out but what's your free cash flow down to three billion you're throwing off what's the number there a lot of cash yeah I mean you're you're it's higher than that but when you throw in VMware thrown beware your your cash flow from ops is roughly riding around seven billion dollars right so you can't go on a business if you don't run out of cash all right that's why we talk about cash no word we're good but you know we're also thing about cash right so look I mean I think we're just going to continue to run the business right we've got to go execute the business it's a challenging you know it's always a competitive environment out there but you know that's our job is to go execute the business macro questions so I think I heard from you Tom this week that IDC has the IT market growing at 2x GDP and I'm thinking about the same hmm how is that you know are people gonna start spending more on AI technology as a percentage of revenue maybe but then I'm thinking what they're spending a lot today on labor yeah and I think what's happening is they're shifting a lot of those labor into technology and they're eliminating some of those labor costs and with that shift is that a plausible premise yeah I think I think it is but I also think that companies are thinking about their business model now and you've seen and you guys know this you're in the middle of all this you've seen a generational shift on IT used to be in the background that said hey go you know go roll up the numbers and pay the people and Peyton you know pay the bills and don't think about the business you know that's a simplification but now it's about how is technology used to differentiate my business model to capture new customers to give you a new experience to give you a competitive advantage and what's interesting for us is that these conversations are not just with CIOs there were Co CF CEO CFOs and so this investment cycle that's here is pretty interesting for us right and so look you asked me about the macro you know it's not a year ago what were we all talking about global synchronous growth right remember that a course we're not really talking about that right now there's you know there's pressure points around the globe depending upon where you are and and it's just a different environment so it is a bit choppier out there I mean I think the macro thing is to me is yeah I'm not as in the weeds as much you guys are but you got consolidation value creation and you guys saw with that big plan and then you got an exploding data ai business happening in the marketplace that's showing customers that they could actually reinvest and do new things drive new revenue source model expansions on the customer side as well as a massive tailwind of course cloud computing you could do it faster so between all these things that's a nice pop for you guys well the technology trends are clearly headed our way right you know there's data being created everywhere you got to do something with that data you got to store it you got to compute it if you want to get analytics and insight and so all of these things are sort of lining up now look I don't want to oversell that because we all know this this business is you know you got to go out and compete every day and to win but it's it's an interesting time are you increasing your spend on technology as a percentage of revenue or you know you know if you're talking about the R&D spend it's rough about four-and-a-half percent of my revenue right now so his revenues going up we're spending more money in IIT oh okay and might in my own tech we're up we're up right as a percentage yes okay digital transformation your premise is people are going to spend more as a percentage on tech because the return is higher but being a good CFO I'm also squeezing my guys in other you keep them in line right congratulations again on you your team Michael creating great shareholder value I still Dave still thinks it's undervalued he'll continue and I think he's right on that thanks for coming on spend your very valuable time sharing this summary of what's going on here at the Dell technology world thanks for being here guys and it's always fun to talk to you thanks great car tops we CFO chief financial officer of Dell technologies getting inside the numbers talking about the strategy how it all relates to customer impacts the cue bringing you all the action day three of coverage we'll be right back after this short break I'm sure for a devil on thing [Music]

>> Live from Las Vegas, it's theCUBE, covering Dell Technologies World 2019. Brought to you by Dell Technologies and it's ecosystem partners. >> Welcome to Vegas! Lisa Martin with John Furrier. You're watching us on theCUBE live. The end of Day One of our three days of coverage of Dell Technologies World. Can you hear the music? The party's already getting started. We have more content to bring you. Please welcome a couple of guests from DXE Technology, Kevin Johnston, Chief Sales and Revenue Officer, Cloud and Platform Service. Kevin, it's great to have you. >> Thank you very much. Glad to be here. >> Our pleasure. We've got Graham Stringer, Managing Director of Workplace and Mobility for DXE Americas. >> Thank you. Good to be here as well. >> Yeah, you waited just in time for the concert, guys! >> We did. >> Just in time. Here we go. >> All right, so, Kevin, let's go ahead and start with you. Give our audience and understanding of DXE. What you guys do, who you are, all that good stuff. >> Yeah, okay. That's great. So DXE was formed two years ago as a result of the merger of legacy HP Enterprise Services Business and CSC. DXE was formed really for the purpose of helping our large enterprise clients accelerate their digital transformation. So we're about a $22 billion IT services company, really aligned with our partners helping our clients transform digitally. >> And you guys were on the cloud early, too. There's a lot of devops going on. >> Yep. >> You guys had your hands in all the clouds. >> We have. >> What's your take on, here at Dell Technologies World, Microsoft's partnering with VMware? >> Yeah, so we would share a lot of beliefs with Dell Technology and VMware in particular, in that multi-cloud is a real thing. And we see multi-cloud, especially for the large enterprise clients, really being an answer for quite some number of years to come. We also believe that a large percentage of application portfolios will migrate to cloud. Whether it's private clouds or public clouds, and that there's a lot of work to be done to transform those applications to really take advantage of cloud native features. >> So last year's theme of Dell Technologies World was Make It Real, 'It' being digital transformation, security transformation, IT transformation, and workforce workplace automation. Graham, I'd love to get your perspectives on workplace mobility and some of the things that were announced this morning with Unified Workspace, Workspace ONE, and recognizing, hey, for our customers to transform digitally successfully, we've got to make sure that their are people are successful, and their people are highly distributed. What are some of the things that you heard this morning that are exciting, aligning with some of the trends that you're seeing in the workplace? >> Well the big trend that we're seeing is the role that HR is now playing in digital transformation of the workplace. If you go back two, three, four years, it was very IT centric. Conversations were predominantly with the CIO. We're now seeing 30, 40% of organizations or more engaging at the HR level. We did a recent project with one of the big retailers in the industry and right out of the bat, this chief HR officer was engaged right from the get-go. They want to know that their employees are going to experience work very differently. So that's one of the big trends we're seeing emerging. >> When did this shift happen? When was this going on? Past year, two years? Because this is a shift. >> I would say the shift has definitely happened the last couple of years. Millennials are having a huge impact. You're getting quite the cross-pollination of a lot of different generations. Millennials are now having an enormous impact. If you look at outlets like Glassdoor, millennials want to know when they go to an organization can I bring my own device? Am I going to have a great workplace experience? And you can't stick with a very traditional, legacy way of delivering IT where everything was shift left and you got to a point where everybody hated each other. >> That's a problem for productivity. >> Yes, a very big problem for productivity, absolutely. >> Talk about some of the challenges that customers have overcome with digital transformation, as it starts to become less of a buzz word and actually more of a reality and strategic imperative that has some visibility at the unit economics and value. >> Yeah, I think every large enterprise client we talk to has a digital transformation agenda of some sort and at some varying place along the path to trying to adopt a new business model or adapt to a different business process, so the challenges that we see with these clients in general is how do we scale? So I have legacy IT that won't disappear overnight and I have all the possibilities of digitally enabling or bringing new digital technologies that enable these processes or models. So this is a challenge: how to enable digital at scale where traditional and digital have to live together for some period of time. >> And it's not just a tech challenge, it's culture, too. How far has tech come because you've mentioned containers with legacy? That has been a great message to IT is I can put a container around it and hold onto it for a little while longer, I don't have to kill it, and make the changes to cloud-native. >> For the tech guys, there's been a lot of fun things and containers probably is the bridge for legacy apps into cloud for sure. For the rest of the folks, for the normal people, the way work gets done and the way to rethink how to do work in the mix of IT or technology into business is just different. >> Graham's point is beautiful because the expectation of the employee or the worker whether they're in the firm or outside the firm, outside in or inside out, however they look at it, is the new experience they want. So the expectations are changing. What's the biggest thing, we saw some stats on stage about remote working, three places, two places, I mean, hell, I'm always on the road. What is some of the expectations that you're seeing? Obviously millennials and some of the older folks. >> They want to see IT delivered in the way they want to receive it. That's one of the biggest trends we're seeing. So for Millennials, my son's kind of in that age category, right, they love to text. To pick up a phone for a younger generation is a little bit foreign. You go and deal with baby boomers, they want to be dealt with in a much different manner. So you've got that whole change, and then you've got the whole notion now of work is changing; where do I work, the ability to basically work 24/7, wherever I want, however I want, using whatever device that I want. And that of course is now creating a whole new set of challenges for IT, particularly around security. >> But employee experience is absolutely fundamental to a business' success; their ability to delight costumers, their ability to deliver outcome, so it's really pretty core. Talk to us about those conversations that you're having with customers. Are they understanding how significant that employee experience is to bottom line business outcomes differentiation? >> Very much so. We're working right now with a large manufacturing firm and they're doing not just an inside out, but outside in, so they're actually coming to watch. It's part of a workplace strategy to look at it from the outside as well. In other words, how can our client take innovation to their suppliers, their customers, to demonstrate that they understand it? So that's extremely exciting when we see that they're not just focused on their own employees and the experience germane to them. >> One thing I might add is that maybe less so from a user experience per say, but the individuals as an employee. So the shift to digital and the skill shift that's required to go with that is really probably the most monumental change that all of us technology companies and the business part of our large enterprise clients is dealing with. Whether it's a skills gap or whether it's a culture gap, this idea of just simply waterfall to agile and the way to think about that or silo versus end-to-end as just simple ways to think differently about how to go faster. So the experience, how you recruit, whose going to make it, who can be trained, and then where you need to be able to source the new talent from as well. >> I totally agree with you. We do hundreds of shows a year, this is our tenth year doing theCUBE, that is the number one things that we hear over and over again from practitioners and customers and from people working. It's not the check, you can always get a check solution, it's the cultural and the skills gap. Both are huge problems. >> And this is part of the digital at scale point. So we'll hire something in the neighborhood of six to eight thousand digital skills people. We're just about to close on active position of Luxoft, an agile devops digital company. We'll bring another 13,000 in. But if you think about the normal large enterprise and what you need to do to be able to have the university networks and to be able to really source that scale in order to effect the transformations that business need to make to stay competitive. >> And the other point, the engagements have changed too. I'm sure you guys have seen your end but every IT or CIO we talk to says, "I outsourced everything decades ago and now I've got a couple guys running the show. Now I need to have a hundred x more people coding and building core competency." That's still going to need to engage people in the channel or our service providers but they need to build core talent in house. It's swinging back and they don't know what to do. (laughter) Is that why they call you guys? Is that how you guys get involved? >> We'll help train. We'll help clients think through what does an IT or business organization need to look like profile wise, skill wise, operating model wise, and in many cases it's I have my digital model but I still have my traditional model that needs to coexist with it and then here's where the opportunities are for people to develop career paths and progress. >> Kevin, talk about the sweet spot of your engagements that you're doing right now. Where's the heart of your business? Is it someone whose really hurting, needs an aspirin, they've got a headache, is it a problem? Is it an opportunity? Is it a growth issue? Where do you see the spectrum of your engagements? >> We kind of find clients in one of three spots normally. "Hey, I know I need to do something but I'm not sure what it is, can you help me figure out to get started?" So more design thinking, problem solving. We have other clients at the other end of the spectrum who are, "Hey, I've got this figured out. I need a partner to help me execute it's scale. And I know the model that I want to do, I know the business reason for doing it." And then we have a lot of folks that are in the middle, which is, "I've started, I've got a few hundred AWS accounts. I got private clouds sitting idle. Someone help me." Or, "I've got security issues, compliance issues." >> So they're in the middle of the journey and they just need a little reboot or a kickstart. >> They need help scaling. >> They ran out of gas. (laughter) >> And how are you working with Dell Technologies and their companies, Dell EMC, if they were to do that? >> The partnership with Dell Technologies, VMware, are really center to how we go to market. DXE is one of the top few partners largest in the ecosystem. The breadth of our portfolios are extremely complementary, whether it's things like device as a service or multi- and hybrid cloud, or pivotal and devops. So the breadth of the portfolios max up really well which makes it the impact potential for our clients even more important. Dell Technology broadly is really one of the few partners that we're shoulder-to-shoulder going with to the market as well. >> Awesome. Great stuff. What's the biggest learnings you guys can share with the audience that you gathered over your multiple engagements holistically across your client base? That's learnings, that could be a best practice, or just either some scar tissue or revelations or epiphanies. Share some experience here. >> I think one of the big learnings we're seeing is the shift now to very much business outcome driven decision making. If you go back to your point about the big ITO outsourcing days, that was all about just strictly driving cost out, and that's why you got to that point where everybody was left hating each other. Now it's about business outcomes. You've got the impact of Millennials, you've got organizations wanting to create a new and better experience for the employees and they're coming to us to say, "How do we accomplish that?" We've got an organization we're working with right now, they're trying to elevate themselves to be one of the top 50 best places to work for in the US. How do they arrive at that? For them, that's their barometer and so it's not about driving costs out, it's really achieving that overall experience and enhance a business outcome. >> So they're betting on productivity gains from morale and happy workers. >> Right. And also they're recognizing the downstream impact on their customers, productivity, the level of employee engagement, right? I mean those are the things that the organization knows that if they hit on those, I mean the sky's the limit. >> Right. Anything on your end? Learnings? >> Yeah, I would say the "don't understand the talent" challenge. The ability to pivot from here's the way we all know and are familiar with doing things to the new way. There will be a big talent challenge. The other thing is the operating model from an IT standpoint. Traditional IT operating model operates at a particular speed, cloud operates at a different speed. And the tools, the talents, the skills that go with that are just completely different. And then I think the last thing is just it seems maybe surprising, but compliance at scale and at speed. So security and regulatory compliance, we see that falling over all the time. >> Great practice you guys. I've been following you guys for many years, you've got a great organization, lots of smart people there we've interviewed many times. My final question is a tech question: what technologies do you guys like that you think is ready for prime time or almost ready for prime time worth having customer keep focusing on and which one's a little more over hyped and out of reach at the moment? >> I'll take a stab at that. If you look at today's Wall Street Journal, Deloitte talks to I believe the figure they quoted was roughly 25% of organizations are doing AI in some form already, PoC or at least are committing to it in terms of strategy. We're seeing that inside DXE as well. AI is now being incorporated into our workplace offerings. The potential for that is enormous, it's real. The technology in the last couple of years, particularly with cloud computing, has really enabled it. When you look at platforms like Watson, these are capabilities that just weren't there 10, 12, 15 years ago, and now the impact that it can have on the workplace, help lines, chats, chatbots, and so forth, is enormous and it's real. Five, 10 years ago it definitely was not in it's maturity. >> Okay, over hyped. >> What's over hyped? I don't know, what comes to mind for you? >> Or maybe I'll rephrase it differently: not yet ready for prime time, but looks good on the fairway but not yet known. . . >> I think for me through workplace, IoT has still got a ways to go. AI and analytics is definitely there. IoT I would say is a little bit behind. I'm sure that Kevin has cloud and platform thoughts. >> Yeah, I would say from an over hyped standpoint, we've seen a lot of companies, large enterprises, legacy application portfolios think they're going to refactor all their applications and cloud native everything. So it feels that people are now kind of getting past that point, but we still see that idea a lot. I think the opportunity that is really in front of us, and you kind of called out, containers. Legacy applications into cloud feel like a remaining frontier for the large enterprise. We think containers and the idea of autonomous, continue optimization, financial performance, is a way to make apps run in cloud financially and performance wise in a way that we don't see a lot of companies fully solving for that yet. >> Awesome. >> A lot of work to do, a lot of opportunity. Kevin, Graham, thank you so much for sharing some of your time and thoughts and insights with John and me on theCUBE this afternoon. >> Very good. >> Thank you. >> We appreciate it. For John Furrier, I'm Lisa Martin, and you've been watching theCUBE live from Vegas. Day One of our coverage of Dell Technologies World is now in the books. Thanks for watching. (upbeat techno music)

(upbeat music) >> Live from Madrid, Spain, it's theCUBE. Covering HPE Discover Madrid 2017, brought to you by Hewlett Packard Enterprise. >> We're back in Madrid, everybody. This is theCUBE, the leader in live tech coverage. My name is Dave Vellante. I'm here with my co-host Peter Burris. And many-time Cube guest Xavier Poisson is back. He's the vice president of Cloud28+ and service providers worldwide for Hewlett Packard Enterprise. And he's joined by Eugene Viskovic, who is the chief business officer at Veon, a Cloud28+ partner. Gentlemen, welcome to theCUBE. Welcome back, Xavier, it's good to see you again. >> Thank you, hi. >> Hi. So give us the update on Cloud 28. It started out as sort of this focused European effort. It has exploded now globally. What's the update? >> So I don't remember, I don't know if you remember it. It was last year, the same event. We were in London, I believe. And we were saying, "Okay, we are 300. "How many will be next year?" I took that back. It will be 700. We are 700. >> Dave: Wow, congratulations. >> 700 members. We have been expanding in the different geographies. So also in Europe, Middle East, and Africa, but we expanded in North America, in A-Pac, Latin America, and Caribbean. So now we are present in 60 countries. We are proposing 24,000 cloud services, so the catalog has been expanding dramatically. We are offering capabilities, data center capabilities from all partners in 33 countries. And we can offer from 400 data centers already. So average we have 40,000 hits per month on the platform, acquiring members and so on. And, yes, it has been a delight to launch that everywhere. It's really taking off very, very quickly. >> And the basic value proposition, you are essentially enabling cloud partners to create cloud-like business capabilities. >> Yeah, so what we do is, first of all, we enable the partners to get known on the market on this side, to publish all their services built and consume also. So it's not only IaaS, PaaS, SaaS, but also integration services as well because it's a comprehensive value chain. Then, what we do, we're not a marketplace where people go and leave. In the center, they can speak everyday. So they publish articles, full leadership articles around security, big data, manufacturing, and so on and so on. This year, only this year, they have published 600 articles. So when you're a customer, you go to this platform. You can see the offering, but you can see how the vendor is positioning himself around the market, his value-add, and what they are doing. So digital marketing a lot, also for them. We have been increasing the value on the market of many of our partners with social media because we are very good activity in this area, and also lead-generation engine because now we have so much offerings that we can target specific campaigns for our partners in specific geographies and generate a lot of leads on the market. Last, but not least, the market is evolving. We have a lot of partners, so we create platform-connected offerings. Example we have done is a specific cloud-in-a-box for manufacturing for plants where, in six clicks, you can provision from Cloud28+ all your information system for a plant. So this is also the kind of things that we do. >> Great, okay, Eugene, tell us about Veon. Why are you in business? What's your story? >> Okay, yes. Just talk a few minutes about Veon because it's not a very well-known name around the world, and don't be ashamed if you don't know Veon because it still is the seventh largest mobile operator in the world. It's significant. We are, today, around 42,000 employees, over 12 different countries. I have to say, very unusual countries. Not the type of countries you may choose to go for holidays, but it would be a shame because, honestly, some of them are good like, you know, all Eurasia, Kyrgyzstan, Tajikistan, Armenia, Tajikistan, Kazakhstan, Georgia, Russia. We have also emerging market, Pakistan, Bangladesh, Algeria, and one, only one European market, which is Italy with WIND, WIND Three. Which means it's a very large region. We are dealing with 10, more than 10% of the total population of the globe, 235 million customers, which is significant. And within this organization, there is an enterprise division, which I'm leading, which is around 4,500 people dedicated for enterprise and wholesales. Full revenue around $3 billion, just to give you a scale on who we are. Again, not very well-known, but definitely within our footprint we are the number one in this particular region of the world. >> It's sizable, substantial business. >> Eugene: Exactly, yes. >> So what's driving your business today? Obviously mobile is exploding. >> Yes, it's clear we came from the mobile business. We are number one mobile operator in the majority of these countries. We are what we call some fixed business. And since the last two, three years when I joined the organization, we completely reorganized our business model and moving more into the what we call value added services, ICT services. And one of the components, definitely, was to try to find a partner for our cloud proposition. You need to understand that we're in a very emerging market for this type of subject. We are sitting in a very traditional way, you know, how enterprise operating. They own the infrastructure, they own data center, they own the servers, the management platform, and their own people. And they have not yet shifted to this new model, which is to try to outsource some of the infrastructure. And this is where we came into the game as a global provider in order to have enterprise really to operate the shift. There is also another interesting situation is every time we bid a cloud proposition, usually we try to centerize it and have different country. In our part of the world is not possible. We have to set up a cloud platform in every single of our countries for regulatory constraints, which is not very economical, but definitely it's an opportunity for us to lead this market especially with HP Enterprise. >> Well, it allows you to differentiate, as well, from some of the mega-cloud providers that everybody knows, everybody talks about. So is that a primary way in which you compete? >> Oh, completely. It's clear the big players today are not very well-implemented in this part of the world because of this particular constraint, outside of Italy which is a little bit different game. But it's clear in Russia and Eurasia, yes. Today there is a opportunity. We believe that we want to be the single provider within this region operating across different market segments because we're covering from SO up to multinational accounts, even government. And having a set of value propositions we can offer across every single of our countries. >> Xavier, is it common that, amongst the Cloud28+ partners, there's that theme of local presence, of course, but is there also a differential in terms of what the partners will do, the types of work they'll do, customizations? >> Yeah, typically the case of Veon is very specific because they address very specific markets. Some other players will ask different things. But what is very important in the case of Veon is, first of all, to have a ready-to-deploy solution that you can industrialize in different countries. So this is the reason why we played with one of the technology partners of Cloud28+, with Ormuco, who has a cloud-in-a-box solution that can be deployed and managed remotely if needed. But that was fitting the needs of the market. Then, what we need to do is really to engage locally. So, in this particular case, what we're going to do is to engage with the HP organization in order that when we have the needs for our customers to go for cloud computing kind of workloads, we say, "Okay, we have the solution. "We have a partner, a Cloud28+ partner, "who took the decision to go with us, "and we trust each other. "So you, Mr. Customer, you want to do "backup as a service, disaster recovery "as a service, compute, storage as a service, "or security as a service, Veon is there." And the good point is Veon is there on very qualified hardware of HP synergy with a very good solution, which is one of the solution ready for service providers of HPE and operated by a very serious tech operator with the number six on the market, this is Veon. And we go together. So in this particular case, what was interesting was to have a solution that can be deployed everywhere the same with workloads that may fit with the different expectations of the market, engage the HP people to play with and, then, we market and with Cloud28+ we'll amplify their message. We will be able to drive lead generation campaigns. We'll be able to onboard our resellers because one thing I believe is that in this kind of regions, people don't go, as you say, Eugene, directly to the cloud. They continue to go to their resellers and, "What do I need to do?" And here, you know that we have the largest reseller network in the industry. So we will introduce this solution to our resellers in order that when a reseller of HPE is in front of such a case, it can have the mind to say, "Okay, let's engage with Veon." So this is the way we are going to operate. >> So when I think of many of the Akistan countries, I think of natural resources, challenging topography, challenging terrain. How does the physical reality and the industries that typify that region impact the way you're providing cloud services? >> It's clear, we're talking sometime a very, very large geography in terms of country size. When you take only in Russia. >> Mountainous. >> Eleven time zones you have in one single country. And when we operate, yes we have to spread our capability in order to be able to touch every single country, including in some infrastructure. Especially as a carrier, I like to imagine how much we need to pull fiber, cable, across the country and have these different set up of infrastructure, cloud propositions, to make sure we can serve better in term latency especially when we're talking about financial sections and so on, which brings some level of complexity and, as I said earlier, also some level of efficiency in term investment because we are not in a perfect world, especially when we talk about the regulatory constraints, which, yes, we need to find some middle way. How we can have a better, being still competitive, but as sometimes still delivering the expected quality. But you are right. This particular part of the world require a lot of work in term of physical infrastructure and also in our team. Our people are spread across these different countries, and for that reason yes, it's not an easy situation. >> Does it drive, are you likely to see a higher demand? HPE talks about the intelligent edge. Are you likely to see a higher demand for things like the intelligent edge because of the nature of the natural resource industry's petrochemical, et cetera, mountainous regions and a lot of communities that you serve, is that going to be a driver of new services or is it going to be something else? What do you think? >> Well, I think there would be two aspects. The first one, there is, definitely, a requirement driven, very often, by very large, multinational corporations. You'll be surprised how this multinational corporations are covering this part of the world. You have natural resources. All the western industry is present. And because they are present, they need to bring their standard in term of infrastructure they are using within this particular country. That the reason, yes, the demand is coming from there. At the same time, you have the rest of the market in term of large, local businesses where it's clear. They are moving. If you're looking in our part of the world, we are exactly where we were 10 years ago in Europe, in North America, and in Asia. We are really into emerging in face, in adopting this type of infrastructure. It's clear it's going to go much more quicker because, on top of that, enterprises have big pressure to reduce costs, but at the same time not to sacrifice the quality, what they're looking. Which, again, together we're capable and we can demonstrate they can get better for less. And this is a big work, and that's the reason when Xavier was mentioning about working together in each of the countries, this was one of the critical element in choosing with HP Enterprise because I'm a mobile operator and fixed. I'm not yet organized as an ICT services or cloud. It was very important for me, if we wanted to go very quickly to associate a brand with a leading organization like HP. And I have to say, I have tested several times. Every time we say, "Okay, we are in "partnership with HP Enterprise. "We are partnered with Cloud28+." This ring immediately the bell of the enterprise we are meeting, and it's easier for us to move quicker. But, definitely, I think we have a big, big opportunity. Large market to address, but definitely something interesting to go after. >> And it's early days, it's only been two years now, what do you want from Hewlett Packard Enterprise, and what are you guys going to deliver? Let's talk road map a little bit. First, from the partner/customer. What are you driving HPE and Xavier to deliver? >> For me there would be three axes in term of development. The first one in term of value proposition. We want to be able, over the next 12, 18 months to be able to offer to the market a full set of propositions, as you mentioned earlier. But Xavier, in term of public, private, hybrid cloud, and moving to different solution, we're talking about security. And, also, we're moving into more vertical market approach. We're talking about IUT where will also be some direction. This is the first ax. The second one, it's in term of countries. We're not going to launch a platform in every single, as I said earlier. We need to do it country by country. We are starting with Russia, Ukraine, Pakistan will come behind, Algeria. Very quickly, over the next 12 months, we are going to launch one by one these different countries. And the last element for us, which is also very key, is market segment. We are organized, as I said, by market segment. SO, small-medium enterprise, large key account, multinational corporation, and government. And each of these segments have different requirements. And we need to customize our approach. This is where where working with HP and Ormuco, we want to have a very customized, bi-market segment from highly customized to off-the-shelf type proposition. But, for me, these would be the three key axes in term of development working with HP Enterprise. >> And Xavier, how does that align with your roadmap? >> Well, you know, it's fully alligned in the sense that, first of all, we are expanding a lot the value prop of Cloud28+ with ISV software vendors. And the problems of telcos and service providers moving to the cloud, that's correct there is ICT branding, and there we can help. But this is the content because one day or another, they will face what the others have been facing, even in these countries, meaning yes is not enough. So if you have a portfolio of applications, verticals, horizontal applications, that they can use to continue to satisfy the demand of the market, so it will be great for them, and we are investing a lot in this order. The other thing is today I believe that we have now reached a maturity on digital marketing with Cloud28+, which is impressive. We had a big event yesterday. I will not give to you the number of impression we had only in four hours. It has been massive. If we take that, we put this at the disposal of this partner in every single country, we will speed them on the market. So these are the two big elements. The third element is what I said about this platform connected solutions because the more we go, the more we see that our outside-in approach with Cloud28+, thinking customers first, is excellent. We need to continue on that. But, as you were mentioning, the move to the edge, we see more and more solutions for energy, for manufacturing, oil and gas, environment, that we need pure hybrid because you cannot put everything into a cloud. And where we are lucky with Veon is that they have the network. So you can imagine, they have their big cloud in a country that they could deploy also some private cloud very, very quickly in specific area within an oil and gas land or I don't know where in energy, mining, or where you have not that. And you cannot, because of latency issues you cannot go directly to the cloud, but you need to handle at the edge, send back to the cloud for analytics or AI or so on, and this will be at the disposal for them. And I believe the combination of the two for that will be for the benefit of the customer. So this is my opinion. >> I completely agree. I think they approach, in term of the partnership, as I said, I think when we're going to deal with very large organizations is going to be very infrastructure-type discussion driven. But when we're going to cool down, it's purely, definitely Sowasis, content. I want to be able to address, for example, the marketing department, how we can help them to understand the behavior of a consumer by using data, big data, you know, analytics. In term of delivery for an organization, using fleet management. In term of manufacturing, using more IUT. But when you look at these different solutions, what is below is a type of infrastructure. Is to have a cloud infrastructure where we can rely on a strong partnership, bringing this solution, and offering to our customer definitely a very cost-effective but also agile, very, you know, able to move with the market demand in a very vertical way, but definitely this is a way we want to work together. >> Excellent. All right, we have to leave it there, gentlemen. Cloud is exploding. Cloud is going to be local. We've talked about this a lot. Hybrid IT, intelligence edge with a local flavor. Gentlemen, thanks very much for coming. >> Thank you very much. >> Thank you. >> And congratulations for all the success. All right, keep it right there, everybody. We'll be back with our next guest. This is theCUBE. We're live from HPE Discover Madrid 2017. Be right back. (upbeat music)

>> Announcer: Live from Las Vegas it's theCUBE covering VMWorld 2017. Brought to you by VMware and its ecosystem partners. >> Okay, welcome back everyone. Live CUBE coverage here at VMWorld 2017. Three days, we're on our third day of VMWorld, always a great tradition, our eighth year. I'm John Furrier with theCUBE co-hosted by Dave Vellante of Wikibon and our next guest is Keegan Riley, vice president and general manager of North American storage at HP Enterprise. Welcome to theCUBE. >> Thank you, thanks for having me. >> Thanks for coming on, love the pin, as always wearin' that with flair. Love the logo, always comment on that when I, first I was skeptical on it, but now I love it, but, HP doing great in storage with acquisitions of SimpliVity and Nimble where you had a good run there. >> Keegan: Absolutely. >> We just had a former HPE entrepreneur now on doing a storage startup, so we're familiar with he HPE storage. Good story. What's the update now, you got Discover in the books, now you got the Madrid coming up event. Software to find storage that pony's going to run for a while. What's the update? >> Yeah, so appreciate the time, appreciate you having me on. You know, the way that we're thinking about HPE's storage it's interesting, it's the company is so different, and mentioned to you guys when we were talking before that I actually left HP to come to Nimble, so in some ways I'm approaching the gold pin for a 10 year anniversary at HP. But the-- >> And they retro that so you get that grand floated in. >> Oh, absolutely, absolutely, vacation time carries over it's beautiful. But the HPE storage that I'm now leading is in some ways very different from the HP storage that I left sic years ago and the vision behind HPE's storage is well aligned with the overall vision of Hewlett-Packard Enterprise, which is we make hybrid IT simple, we power the intelligent edge, and we deliver the services to empower organizations to do this. And the things that we were thinking about at Nimble and the things that we're thinking about as kind of a part of HPE are well aligned with this. So, our belief is everyone at this conference cares about whether it's software defined, whether it's hybrid converge, whether it's all flash so on and so forth, but in the real world what clients tend to care about is kind of their experience and we've seen this really fundamental shift in how consumers think about interacting with IT in general. The example I always give is you know I've been in sales my whole career, I've traveled a lot and historically 15 years ago when I would go to a new city, you know, I would land and I would jump on a airport shuttle to go rent a car and then I would pull out a Thomas Guide and I would go to cell C3 and map out my route to the client and things like that. And so I just expected that if I had a meeting at 2:00 p.m., I needed to land at 10:00 a.m., to make my way to, that was just my experience. Cut to today, you know, I land and I immediately pull out my iPhone and hail an Uber and you know reserve an Airbnb when I get there and I, for a 2:00 p.m. meeting I can land at 1:15 and I know Waze is going to route me around traffic to get there. So, my experience as a consumer has fundamentally changed and that's true of IT organizations and consumers within those organizations. So, IT departments have to adapt to that, right? And so a kind of powering this hybrid IT experience and servicing clients that expect immediacy is what we're all about. >> Okay, so I love that analogy. In fact when we were at HP Discover we kind of had this conversation, so as you hailed that Uber, IT wants self driving storage. >> Keegan: Absolutely. >> So, bring that, tie that back, things that we talk a lot about in kind of a colorful joking way, but that is the automation goal of storage is to be available. We talk about edge, unstructured data, moving compute to the edge, it's nuanced now, storage and compute all this where they go through software. Self driving storage means something, and it's kind of a joke on one hand, but what does it actually mean for an IT guy? >> No, that's a great question and this is exactly the way that we think about it. An the self driving car analogy is a really powerful one, right? And so the way we think about this, we're delivering a predictive cloud platform overall and notice that's not a predictive cloud storage conversation and it's a big part of why it made a ton of sense for Nimble storage to become a part of HPE. We brought to bear a product called InfoSight that you might be familiar with. The idea behind InfoSight is in a cloud connected world the client should never know about what's going on in their infrastructure than we do. So, we view every system as being at the edge of our network and for about seven years now we've been collecting a massive amount of information about infrastructure, about 70 million telemetry points per day per system that's coming back to us. So, we have a massive anonymized dataset about infrastructure. So, we've been collecting all of the sensor data in the same way that say Uber or Tesla has been collecting sensor data from cars, right, and the next step kind of the next wave of innovation, if you will, is, okay it's great that you've collected this sensor data, now what do you do with it? Right? And so we're starting to think about how do you put actuators in place so that you can have an actual self managing data center. How can you apply a machine learning and global kind of corelation in a way that actually applies artificial intelligence to the data center and makes it truly touchless and self managing and self healing and so on and so forth. >> So, that vision alone is when, well, I'm sure when you pitched that to Meg, she was like,"Okay, that sounds good, "let's buy the company." But as well, there was another factor, which was the success that Nimble was having. A major shift in the storage market and you can see it walking around here is that over the last five, seven years there's been a shift from the storage specialist expert at managing LUNs and deploying and tuning, to the sort of generalist because people realize, look, there's no competitive advantage. So, talk about that and how the person to whom you've sold and your career has changed. >> Yeah, no, absolutely, it's a great point. And I think it's in a lot of ways it goes to, you're right, obviously Meg and Antonio saw a lot of value in Nimble Storage. The value that we saw as Nimble Storage is as a standalone storage company with kind of one product to sell. You know there's a saying in sales that if you're a hammer everything looks like a nail, right. And so, it's really cool that we could go get on a whiteboard and explain why the Castle file system is revolutionary and delivers superior IOPs and so on and so forth, but the conversation is shifting to more of a solutions conversation. It moves to how do I deliver actual value and how do I help organizations drive revenue and help them distinguish themselves from their competitors leveraging digital transformation. So, being a part of a company that has a wide portfolio and applying a solutions sales approach it's game changing, right. Our ability to go in and say, "I don't want to tell you about the Nimble OS, "I want to hear from you what your challenges are "and then I'm going to come back to you with a proposal "to help you solve those challenges." It's exciting for our sales teams, frankly, because it changes our conversations that makes us more consultative. >> Alright, talk about the some of the-- >> Value conversations. >> Talk about the sales engagement dynamic with the buyer of storage, especially you mentioned in the old days, now new days. A new dynamic's emerging we've identified on theCUBE past couple days and I'll just kind of lay it out for you and I want you to get a reaction. I'm the storage buyer of old, now I'm the modern guy, I got to know all the ins and outs of speeds and feeds against all the competitors, but now there's a new overlay on top of which is a broader picture across the organization that has compute, that has edge, so I feel more, not deluded from storage, but more holistic around other things, so I have to balance both worlds. I got to balance the, I got to know and nail the storage equation. >> Yeah. >> Okay, at well as know the connection points with how it all works, kind of almost as an OS. How do you engage in that conversation? 'Cause it's hard, right? 'Cause storage you go right into the weeds, speeds and feeds under the hood, see our numbers, we're great, we do all this stuff. But now you got to say wait a minute, but in a VM environment it's this, in a cloud it's like this and there's a little bit of bigger picture, HCI or whatever that is. How do you deal with that? >> No, absolutely, and I think that's well said. I mean, I think the storage market historically has always been sort of, alright, do you want Granny Smith apples or red delicious apples? It always sort of looked the same and it was just about I can deliver x number of IOPs and it became a speeds and feeds conversation. Today, it's not just not apples to apples, it's like you prefer apples, pineapples, or vacuum cleaners. Like, there's so many different ways to solve these challenges and so you have to take the conversation to a higher level, right. It has to be a conversation about how do you deliver value to businesses? And I think, I hear-- >> It gets confusing to the buyers, too, because they're being bombarded with a lot of fudd and they still got to check the boxes on all the under the hood stuff, the engine's got to work. >> And they come to VMWorld and every year there's 92 new companies that haven't heard of before that are pitching them on, hey, I solve your problems. I think what I'm hearing from clients a lot is they don't necessarily want to think about the storage, they don't want to think about do I provision RAID 10 or RAID five and do I manage this aggregate in this way or that way, they don't want to think about, right. So, I think this is why you're seeing the success of these next generation platforms that are radically simple to implement, right, and in some ways at Nimble, wen we were talking to some of these clients to have sort of a legacy approach to storage where you got like a primary LUN administrator, there's nothing wrong with that job, it's a great job and I have friends who do that job, but a lot of companies are now shifting to more of a generalist, I manage applications and I manage you know-- >> John: You manage a dashboard console. >> Exactly, yeah, so you have to make it simple and you have to make it you don't have to think about those things anymore. >> So, in thinking about your relationship over the years with VMware, as HP, you are part of the cartel I call it, the inner circle, you got all the APIs early, all the, you know, the CDKs or SDKs early. You know, you were one of the few. You, of course EMC, NetApp, all the big storage players, couple of IBM, couple others. Okay, and then you go to Nimble, you're a little guy, and it's like c'mon hey let's partner! Okay and so much has changed now that you're back at HPE, how has that, how is it VMware evolved from a ecosystem partner standpoint and then specifically where you are today with HPE? >> That's a great question and I remember the early days at Nimble when you know we were knocking on the door and they were like, "Who are you again? "Nimble who?" And we're really proud of sort of the reputation that we've earned inside of VMware, they're a great partner and they've built such a massive ecosystem, and I mean this show is incredible, right. They're such a core part of our business. At Nimble I feel like we earned sort of a seat at that table in some ways through technology differentiation and just grit and hustle, right. We kind of edged our way into those conversations. >> Dave: Performance. >> And performance. And we started to get interesting to them from a strategic perspective as just Nimble Storage. Now, as a part of HPE, HPE was, and in some ways as a part of HPE you're like, "Oh, that was cute." We thought we were strategic to VMware, now we actually are very strategic to VMware and the things that we're doing with them. From an innovation perspective it's like just throwing fuel on the fire, right. So, we're doubling down on some of the things we're doing around like VM Vision and InfoSight, our partnership with Visa and on ProLiant servers, things like that, it's a great partnership. And I think the things that VMware's announced this week are really exciting. >> Thank you, great to see you, and great to have you on theCUBE. >> Thank you so much. >> I'll give you the last word. What's coming up for you guys and HP storage as the vice president general manager, you're out there pounding the pavement, what should customers look for from you guys? >> No, I appreciate that. There's a couple things. So, first and foremost are R&D budget just got a lot bigger specifically around InfoSight. So, you'll see InfoSight come to other HPE products, 3PAR, ProLiant servers so on and so forth and InfoSight will become a much more interesting cloud based management tool for proactive wellness in the infrastructure. Second, you'll see us double down on our channel, right. So, the channel Nimble's always 100% channel, SimpliVity was 100% channel, HPE Storage is going to get very serious about embracing the channel. And third, we're going to ensure that the client experience remains top notch. The NPS score of 85 that Nimble delivered we're really proud of that and we're going to make sure we don't mess that up for our clients. >> You know it's so funny, just an observation, but I worked at HP for nine years in the late '80s, early '90s and then I watched and been covering theCUBE for over seven years now, storage is always like the power engine of HPE and no matter what's happening it comes back down to storage, I mean, the earnings, the results, the client engagements, storage has moved from this corner kind of function to really strategic. And it continues that way. Congratulations. >> Thank you so much. Appreciate the time. >> Alright, it's theCUBE. Coming up Pat Gelsinger on theCUBE at one o'clock. Stay with us. Got all the great guests and alumni and also executives from VMware coming on theCUBE. I'm John Furrier, Dave Vellante. We'll be right back with more live coverage after this short break.

>> Announcer: Live! From Las Vegas. It's theCUBE. Covering HPE Discover 2017. Brought to you by Hewlett Packard Enterprise. >> Welcome back everyone. We are here live in Las Vegas for SiliconANGLE's Cube exclusive coverage of three days of wall to wall interviews here at HPE Discover 2017. I'm John Furrier, your host with Dave Vellante, cohost. And our next two guest is Rod Bagg, VP of Analytics, Customer Support, Data Center, Infrastructure, HPE, formerly Nimble now HPE. and Paul Sabin, Senior Network and Infrastructure Manager at Baker Botts LLP. Guys, thanks for joining on theCUBE. >> Male Voices: Thanks for having us. >> So we talked before we came on camera about all the great stories Nimble obviously part of the fold here at HP Enterprise. Your customer stories. Let's get right into it. Tell your story about how Nimble put you out of a job. That's my favorite one. Go. >> Okay, so when I started or when we bought Nimble Storage, I was the senior storage engineer. So we purchased it, we brought it in-house. It was up within, within an hour, I was already starting carve out LUNs. At that point, I'm using the restful APIs to carve out the rest of the 200 LUNS that we needed. Presenting it to the hosts. And by the end of it, it ran itself. Between InfoSight and the fact that the product just is so easily automated, I kid you not, true story, at the end of the year when we were doing our self evaluations, my evaluation said, and congratulations, you don't need me anymore. My position is obsolete. And the management came back and said, Paul, you're absolutely right. We agree that we don't need this position anymore so we're going to promote you to the senior network infrastructure team. (John laughs) So I manage that now. >> So you got promoted. But this is a trend in automation. This is the DevOps, this is the programmable infrastructure world we're moving into with hybrid. >> Exactly. Rod, this is big deal. >> Yeah, yeah exactly. InfoSight as we see it plays a big role in that. Really the product is simple and being able to automate that. But InfoSight giving our customers sort of visibility at a very deep level into how the systems are performing. And what we do on the backend to drive availability really takes a lot of pain off of our customers. Not sure that we put everybody out of work but we certainly make life easier. So that they can focus on the business aspect. >> And you automate those tasks the way that really should be automated and that's a cool thing. >> Yup. >> Take a minute. I'll like you to take a minute just to explain what the product is and what you guys are doing. Just so we can get that out there as context. And then jump into some more stories. >> Yeah so from an InfoSight perspective? >> John: Yeah. >> So InfoSight is our predictive cloud analytics platform that uses machine learning to predict and prevent problems from occurring to our customers. So we're not disrupting their business. And so we collect somewhere in the order of, about maybe 25 million pieces of information from every array and the virtual environment. Everyday from every single array. All of that gets into a galactic database, where we have a team of data scientists working with our support engineers and our product engineers to build wellness rules. We have about eight hundred health checks that are really looking out at every part of the infrastructure for our customers and really avoiding issues for them. >> So you take the data across your entire install base. >> Rod: Yup. >> I'm sure you take care of the data so it's not all-- >> Rod: Oh yeah, it's all secure. >> Secure and nanomized. And then use that as predictive to prescribe or both or how are you-- >> Yeah both. So our real goal there is that if we know of an issue, that's either we found in our labs or maybe one customer has experienced it. Really, we're doing everything we possibly can to analyze that issue across the entire install base. So we're learning from peers. >> Male Voice: Yup. >> And applying those learnings across the install base and preventing other customers from hitting that issue. >> The system is autodidactic in this sense. It learns and then applies, is that right? >> Yeah. So we do machine learning. Semi-supervised in a lot of cases. So where we've seen and issue and we can train the models. And then it will look out for those sort of issue across the entire install. >> John: I like the notion of wellness. >> Yup. >> Brings some of the people we relate to. We also heard terms like self-driving storage. >> Yup. >> Layoff testers. >> Yeah. >> But this is again, the trend that really is needed. Share other stories that you have because this is really where IT is going as it moves to a different kind of application and consumption model for you guys. >> Right so, well, kind of touching about what he was talking about, when you're as a storage guy, what's the number one thing that us storage guys have to do, is we have to prove that it's not the storage that's the problem. So usually, what happened was, in the old world, I would produce some statistics of, okay, and here's the IOPS that we're producing and here's the latency during this time. So based on this, it wasn't me, I don't know who it was. I'm just going to tell you it's not me. In the new world-- [John] That was the finger pointing world. >> Yes it was! >> The other guy got it. >> But with InfoSight, it's like hey, I can tell you but you're also welcome to go here as well. But let me show you VMM site where it's going to show you, not only what was happening at the storage. But let me take you all the way down to the host and then the VM and we're going to find this problem. And yeah, turns out sometimes it's going to be the VM that's all of a sudden taking whatever reason adding a huge amount of latency. And that, is something that, there's no more finger pointing in it anymore. All of a sudden, we're in the same team, it's like this kumbaya thing. >> That's awesome. It's good for the cohesiveness as a team. But also it's time savers too. When you reduce the steps to do things, you get your weekends back as you guys say before you came on camera. Tell the story about how you had to do all this work on the provisioning on the replication side, >> Sure. When we deployed the arrays, we decided it was business decision to go ahead and put the production arrays into our production data center and then we would do the DR at a later time. So I've got all of my data live, on production. And they say, okay, we're adding our Nimble storage at our DR site. Paul, how much replication bandwidth do we need? And so, same story. In the old world, you go and you pull your statistics from your replication technology, you put it in excel spreadsheet, you figure out, okay, here's my peaks and I just want to say, if we fall behind just a little bit, this is what we can do. And so usually what happens is, I say, guys, in my best guess, based on what I can see from my limited scope because my eyes are bleeding at this point. >> From the spreadsheet. You're in a spreadsheet right now. >> Paul: Yes, exactly. >> You're in spreadsheet hell. >> I'm in spreadsheet hell. And so what I do is, after about a weekend's worth of work, I put in this recommendation and I usually fluff it because I could be wrong in my statistics and so this is what I end up creating. >> You don't want to be under. You want to be over. >> Exactly, I'm always trying to do that. So the firm, I'm, hopefully this is, nobody's watching at the office, but sometimes they maybe overpaying for something because I just don't want to make that chance. In the new world, this is actually the coolest thing ever. So I'm on InfoSight and I go to this little dropdown, it's like the tool planner, okay, what's that? Where it's going to tell you what you need for bandwidth based on your actual real data. So then I'm pulling, like okay, based on this time, what is the replication if I want to do it every hour. And what if I want to do it every two hours? So then I just take that and I turn it into this report that I got to present to the executive team and they're like, oh my goodness, you have certainly stepped up. How many weekends did you use on this one? And you know, I'm not going to tell them it took me five minutes in InfoSight (John laughs) to be able to create this report. >> Now that they. >> But now they know. >> Cat's out, but you already got promoted. >> Oh that's true. >> Hey Rod, can you talk about the decision to acquire Nimble. What was the genesis. Obviously there's a portfolio component, tuck-ins, fill in some gaps. But there's this other sort of IP piece. Maybe take us back. >> Yeah, so certainly, there was the portfolio fit with the storage platform. So that was obviously a big part of it. I think the other obviously big part was InfoSight. So the idea that what we're doing there with our customers and approving the availability of the systems and the operational performance of the system and keeping a close eye on that to make sure it's optimized. So all that value prop around InfoSight was a big part of the decision I think. We are working on extending InfoSight into the HP product line. Starting with 3PAR so we are working already with that engineering team. To be able to bring some of these features out as quickly as we can into the 3PAR world as well. >> So what is that, from an engineering standpoint, is that sort of the requirement there is to point InfoSight at the data, the 3PAR data? >> Yeah exactly. So 3PAR does collect a lot of data already. >> Yeah sure do. >> So really, we're just pulling that data into our pipelines and so on within InfoSight and taking advantage of some of the machine learning and algorithms and so on that we already do. Things like DMVision, would be possible and so on in that environment as well if you're a 3PAR customer. >> It's interesting. Back in, maybe 10 years ago, 3PAR was sort of the gold standard of what we used to call the hero report. >> Rod: That's right, yup, yeah. People love that. >> Thin provisioning. What impact it was. >> Rod: Yup. How much you save, et cetera. And then that predated the whole big data analytics years right? >> Rod: Yeah, exactly. >> So when Nimble started, they could have started with that premise. Right around that time. >> Yeah, yup. >> I remember when I first saw it, I was like wow this is magic. >> Yeah exactly. That was the premise, was to really apply data science to all of that data that was coming in. Really transform the support experience for Nimble. And I think that's the other big element for HP as well. There's lots of that we do in our support organization that, to be honest, it's quite enviable, by a lot of storage and high tech vendors. >> You guys took a different approach. I think what's really notable for me, which I'm impressed with is, everyone talks about this but very few put into action, is making the user experience center, >> Rod: Yeah exactly. >> Of the value. I mean all of the things you talk about, the benefits, is really centered around your experience right. Saving you time, making your life easier, shifting the automation, that could be automated with the right things. And moving into higher value things. So Paul, what's your thoughts on this as it goes forward. This world is evolving. We're hearing the message here, simplifying, hybrid IT, you got cloud right on the doorstep, multiple clouds are going to be the endgame, we'll know all this, so all said and done. Whole new infrastructure is going to be out there. What's your view of how that user experience for the practitioners will evolve. What's your vision. How do you see it playing out. >> Rod: Be out of a job again. (Paul laughs) >> No, true story. The firm decided that they were going to bring us some people to help us look into what cloud we should, or how we should utilize the cloud because even from us, we're trying to keep ourselves agile as a law firm. Because if we can provide our services in a better, more meaningful and faster way, that gives us a competitive edge. So we brought in this team and they went over all of our IOPS and at the time it was under the different storage system so it took at least 20, 30 hours of my time to get all these numbers that they wanted. And then they created this report for us. Which I thought was really meaningful and valuable. The last line was, you should do cloud work, cloud makes sense. So that was it. Solid advice you know. Money well spent. (laughs) >> And that's what Meg's basically saying in the key note. The right mix of cloud versus on-prem. Certainly law firms have proprietary information and they want it secure. I guess my question really is, fundamentally is, a provocative one, I'd love to get your thoughts on. Serious question, you can laugh at at it a little bit but with AI bots coming, you can almost see these kinds of legal tasks being automated away. So, you might be, next promotion is taking over the firm. That's where big data can in. So how are you guys looking at that as a firm because I'm sure the lawyers are saying, hey you know what, I can shift my value to higher yield activities >> Paul: Exactly. >> Where that makes sense. You guys talk about that at all? >> We do. And I actually use the example of NASA. I really love NASA, I'm a huge fan. And NASA decide, they declared, we're going to go to Mars. We're going to do this. How are we going to do this? We have to let go of our operational stuff. We have to let go, I mean we can launch the shuttle all day long, we're comfortable with that. We can go into the space station, we're comfortable with that. But now, we've got to go new. And the way we have to do that is, we have to drop this stuff. Let's let other people do this. Let's let the InfoSight team start handling a lot of that work for me. And now, I'm asking my team, guys, I want you to start dreaming. Get out of the operational work. Start dreaming out loud. Let's figure out ways we can deliver value to our attorneys. >> Exactly. >> To free them. And let's let them just, again, take that same freedom, with the business intelligence and the machine learning, you're right that they're document management, which is their bread and butter, is their document production. Even that's getting scrutinized or transformed through this machine learning. And so, you could take this as a, as a way of saying no, there goes my job. Or you can say no, now I've got the opportunity to do something even better and cooler and really bring the value. >> And stretching. That's the whole stretch goal. Having that moonshot, in this case Mars. >> Paul: Mars right. >> It's the stretch and leverage right. >> Paul: Yes. >> That's the concept. How do you apply that to storage because now HP's got the composability, they got synergy. >> Paul: Yeah, yup. >> They have all kinds of. Now glue layer's kind of developing. We heard Antonio Neri in the press and analyst queue. We heard Meg Whitman talk about, you know, most her acquisitions have been in software, except for maybe one or two, over the past couple years, have been software. >> Paul: Yup. >> So, hardware, software kind of blending. >> Yeah. I think so, from the storage perspective certainly, I think that's happening. I think from the InfoSight perspective, where we see that going, is again, today when we put a lot of effort into our recommendation models. And that's an area that's very much in the deep data sciences realm. So when we come up with those recommendations, >> John: Umhmm. >> you know, we do things where we can prevent people from hitting issues and not just sort of happen automatically but some of these things are, something needs changing in their environment. So maybe, maybe there's a QoS policy that should be applied on the array to optimize performance because of some peak workload during Christmas, something of that nature. So that's still a last mile problem for us because you've got a human at the other end that's got to go in there and fix it and hopefully do it right and not ignore it and everything else. >> I can see the headline now, storage wellness coming to HP. >> Rod: Yeah exactly. >> But this is really interesting, comes with self-healing right. >> So that's where we want to go with that. That is really the thing we're working towards in the vision is, how do go and do that, change those QoS policies for the customer where we could inject, let's say, a change control within their change management system. They can go hit a button which we orchestrate that change for them. It's all documented and well controlled. >> It's not just storing the data, it's being data driven for the data being stored in the self crafting storage. >> Rod: Exactly, yeah, exactly. >> Rod, Paul thanks so much for sharing the stories and congratulations on the promotion. >> Thank you. >> And congratulations on InfoSight. You guys got great story there. >> But I never get promoted. (everyone laughs) >> Come in theCUBE, >> great story right. >> get promoted. >> Birds of a feather. >> Appreciate it. >> Thanks for having us. More live coverage here from theCUBE. Here at HP Discover 2017 after this short break. I'm John Furrier with Dave Vellante. We'll be right back. (lively music)

>> Announcer: Live, from Las Vegas, it's theCUBE covering Dell EMC World 2017. Brought to you by Dell EMC. >> Okay, welcome back everyone, we're live here, day three of three days of coverage of theCUBE at Dell EMC World 2017. I'm John Furrier with my co-host Paul Gillin and special guest on our day-three opening, Peter Burris, head of research of SiliconANGLE Media, general manager of wikibon.com research. Guys, good to see you on day three. We're goin' strong. I mean, I think I feel great, a lot of activity. So many story lines to talk about. Obviously the big one is the combination, not merger, I slipped yesterday, or acquisition, the combination of equals, Dell, EMC. Some will question did EMC acquire Dell or Dell acquire EMC? Certainly Michael Dell's still captain of the ship. But that's the top story. But a lot of product line conversations. Not a lot of overlap. Peter, you've been at all the analyst sessions. We had David Furrier on yesterday, teasing it up, but I'd like to get you, your perspective and reaction to your thoughts as you look at the giants in the industry. Michael Dell bought EMC for a record 60 billion plus. You've been around the block. You've seen many waves. You've analyzed many generations of the computer industry. What does this actually mean. Where are they, what's your thoughts and reaction? >> So John, I'll give you three different story lines here, right? The meta-picture, the good, and the what the hell's goin' on kind of picture. The first one, the meta-picture is, and SiliconANGLE said this, it was a really well written article, you might have even written it Paul, that there has never really been a successful mega-merger in the tech industry. And historically I think that's because, well here's the bottom line. This one may actually work. And it may actually work nicely. And the reason is is that most of the other mergers or combinations were companies with problems and companies that didn't have problems. Or companies with problems and companies with problems. And if you take a look at Dell and EMC, neither of them had problems. They weren't buying each other's problems. It was a nice combination and complimentary in that EMC had a great consumer business, great channel business, and had a pretty strong financial position. And EMC had a great enterprise business, great, you know-- >> Sales organizations. >> Great sales organization. And they had, they were strong in where the industry's going around how do you handle data and how do you handle storage. So it's got, what we're seeing here is everybody singing out of the same hymnal. I'm not seeing any tension. And that is an indication that this one may actually go well. I think it's a very, very good early sign. >> Paul, you and I were talking on the day one open and also, we kind of hit it a little bit yesterday with David Furrier, talking about this mega-merger. Compare and contrast that to HBE, which is been kind of, being de-positioned by some of the Dell executives. They don't actually call 'em out by name, but HP Enterprise is taking a different approach. They're taking a, you know, smaller is better approach. Obviously, Michael Dell has a complete different philosophy. We're still going to analyze that as well. We've got HPE Discover coming up as well. Thoughts on the compare and contrast, guys, reaction to the strategies of HPE, smaller, faster, as they say. Or Dell, bigger, more powerful. >> I think both are viable strategies. It's just a matter of if they can pull it off. I mean, HP, you talk about bad mergers, Peter, I mean you think of HP Compact, HP Autonomy, this is a company that has had a terrible track record of big mergers. Although they've had some successful ones certainly. >> By the Meg Whitman inherited those. >> Yes. >> Prior to Meg Whitman coming on board. >> Oh she was a board member for some of them. >> Okay, so she was at the table. Now, we don't know, okay but your thoughts, continue. >> But Dell, clearly going the other direction. They, I mean, they're building sort of an IBM-like model, the way IBM was in the '80s when it dominated every market that it played in. And it played at even more markets than Dell does now. So I think that the model makes sense. I think Peter's absolutely right, I'm not sensing any tension at this conference. There seems to be, the most important thing is there seems to be a lot of communication going on. The executives are spending a lot of time with each other and they're talking a lot to the people. And when you look back, and I live, and Peter, you remember the DEC, you know, the fiasco with DEC being purchased by Compaq. That was clearly a takeover. And that was Compaq came in, took over the company and didn't tell anybody anything. And the DEC people were living in the dark and it was clear that they had no value to the acquiring company. That, clearly, they're not making those mistakes here. >> For the younger, for the younger audience, DEC is Digital Equipment Corporation which was a behemoth winner in the micro, mini-computer era and then now defunct company. >> Except the one, one thing I'd add to that, Paul, is that, and this is why, it's why this first sign is so important. That they are seem to be, that executives here seem to be collaborating and working together. DEC had been one of those mini-computer companies dominated by an OEM business, which means you had a common set of components and then everybody was competing for customers with how you put those components together. So there was, it was a, it was a maelstrom of internal competition at DEC. When Compaq got ahold of DEC, that DEC sense of internal competition took over Compaq. And then when Compaq, when HP acquired Compaq, that maelstrom and internal competition took over HP. >> They didn't know what they were getting into. >> We used to call it the red-blue wars and it was ugly. And that's not happening here. That's a first sign. >> Yeah, I would agree Peter. I want to get your thoughts to all that. I would agree that this is, I've been tryin' to sniff out where the wind's blowin' on this for a year and to my knowledge, and my insight and sources, it's not going bad at all. It's going great. The numbers are performing, they're winning some deals, but let's compare to HP because I asked Mark Heard at their Oracle media event last week, cause they were touting number one in every market. So I said, "Well, there's a digital transformation "going on, a whole new way to do business "for the next 33 years, "not looking back at the past 33 years." Which metrics are you using? Everyone's claiming to be number one at something. So, the question is, maybe HP does have it right. Maybe their strategy will work. What are the, what are going to be those metrics for this next generation? If cloud becomes the connective tissue to data, value of data, and that apps are going to be very agile. Maybe this decentralized approach from HP might be a better strategy for the growth. Thoughts. >> Well, look, let's, so let's, I want to get back to the, what's good about what we're seeing and some other things that probably need to be worked on, but, but here's what I'd say, John. And this is what Wikibon believes. That customers is always going to be the most important metric. So, the first metric is, is HP gaining customers? Is HP losing customers? Is Dell gaining customers? Or is Dell losing customers? That's the number one most important metric. Always will be as far as I'm concerned. But the second one is, and this, and I'll pre-say something I'm going to talk about in a little bit. The second one is, I'll call it data under management. If we think about, if we think about this notion of data as an asset, data as a source of value, how much does HP, through it's customers, how much data does, does HP have under management? How much data does Dell/EMC have under management? And I think that's going to be an important way of thinking about the intensity of the relationships, which relationships are going to steer towards which types of environments. Is it going to be a procurement relationship or a real strategic relationship? By procurement, I mean, it's fundamentally focused on driving cost out of the deal. Strategic, I mean it's fundamentally focused by jointly creating value. So this notion of data under management, to me, is going to be something we're going to be talking about in five years. >> So, Bill Schmarzo, friend of both of ours, was, came by the set before we came on here and he's the dean of big data as coined by theCUBE but now he's takin' on it his own, like he's actually a dean now teaching big data. We are talking about some of the research that you're doing and taking a stand on, it's important, I want to put a plug in for the Wikibon research team that you're leading, is the business value of data. >> Peter: Oh absolutely. >> And that you're looking at data as a valuation mechanism, not an accounting, compliance thing. And this is something, I think, is way ahead of the curve. So props to you guys for puttin' the stake in the ground. To your point, the new metric might just be the valuation of how they use data, whether that's customer data, product services data, application development concepts to reconfiguring how they do business. >> And it's the reconfigure that's the smart, that's the absolutely right word. So, from our perspective John, the difference between a business and a digital business is a business uses data one way, a digital business uses data another way. A business uses data as an, something to just handle coordination and administration. >> Paul: Bookkeeping. >> Yeah, exactly. A digital business uses data as a strategic asset to differentiate how to engage to markets. That's where the industry's going, and that's what we want to talk about. >> And by the way, in previous business constructs or business books people have, might have read over the years certainly, you know, the Peter Druckers and so on, management consultants, never actually factored data into the value chains of-- >> Oh they did, they did, they did. They just didn't actually, so Drucker, for example did. >> John: Digital data? >> Oh, he talked about information and the role that information played. >> John: I stand corrected. >> Herbert Simon talked about this kind of stuff 50 years. Unfortunately it all got lost when we went through things like, jeez, you know, there was a very famous economist who said in the late 80s, "Information technology "shows up everywhere but in the productivity numbers." So, you old guys would-- >> I remember that, I remember that quote. >> So, the idea ultimately is we now have to get very discrete and very specific about what that means. And that's a challenge. But let's come back to, let's come back to at least what we think is really working here, if I may. >> John: Absolutely, go ahead. >> So the first thing is, at a more tactical level, number one is the Hyperconvert story is exciting. And it's starting to come together. And again, I'm not, we're not seeing tension between the folks that are selling servers and the folks that are doing Hyperconversion. Both are introducing new technology that are going to create new opportunities for customers, and they're not as, as, as your good friend Michael Dell said, a couple times over the past year, here in theCUBE, "We are not going to "artificially constrain any of our businesses." And, as Amazon said at re:Invent, "If you're going to do it at scale, "eventually you're going to put in hardware." And he wants to demonstrate that all this great software stuff that's happening, that ultimately Dell's going to be the leader at designing these new capabilities into the hardware and he wants to show how that's going to show up in all his product lines. >> That's a great point. I think the most interesting dynamic I've been seeing out of the interviews we've been doing the last two days is that the problem Dell has to struggle with now, and it'll be interesting to watch how they, how they figure this out, is all of their, used to be called the Federation, now they're called the Strategic Business Alliances I think. The, you know, the VMwares, the RSAs, the Pivotals, how are they going to make sense of those in the context of this bigger whole? On the one hand, they've got some competing priorities here. Dell has a very strong relationship with Microsoft, VMware is a competitor to Microsoft. So you got to figure out how to get those, how to make sense of those different alliances. Pivotal is potentially a competitor to Microsoft. >> Potentially? >> Well, Microsoft is in the pass business, yeah. >> No, it is yeah, it's going to compete. >> So you've got a, you've got some paradoxes here in the businesses that Dell has acquired. They really still, I sense they still haven't made sense of what they're going to do with them. >> Yeah, great point. I mean, first of all, you guys are pros and we have a historical view here of the collective intelligence of all of us old guys here. We've seen a lot of ways. But Rob Hof wrote an article on SiliconANGLE, our Editor-in-Chief Rob Hof, who's also an industry veteran and journalist himself. After the Oracle media event, and the headline reads, "In Oracle's Cloud Pitch to Enterprises, "an Echo of a Bygone Tech Era." And his point with this story is, I want to get your reaction to this, cause I think we're seeing a trend here, you guys are teasing out here. We're kind of going back down to the old tech days. You were the Editor-in-Chief of Computerworld back in the day with the mainframe world and then the minis. Seeing Marius Haas on here using words like "Single pain of glass." "One throat to choke." "End to end." We're almost seeing the bygone era coming back again where maybe they might have the rights to it. Certainly Oracle saying, "Hey, you know, "reorganize our sales force." So the question. Is the cloud the de-centralized mainframe. Is it now the new centralized, with edge, intelligent edge, is that, are we going back to the old ways, in a way, not fully but, unifying the sales forces. >> So, the computing industry-- >> Thoughts. >> Has been been on an inexorable march to greater utilization of public infrastructure. What an economist would say is we've always found ways to reduce asset specificities. I buy something, and I apply it to one purpose. I can't apply it to another purpose. Software changes that. Commodity pricing and hardware changes that. Public infrastructure changes that. So we're going to continue to see that inexorable march to the use of public infrastructure or somethin' that looks like public infrastructure. And that's going to continue. And the industry's always been very, very good at that. That does not mean, however, that we're going to have one supplier. So what we're seeing is a lot of FUD right now. Amazon FUD, Dell FUD, Oracle FUD. There is a real tension in the model and the real tension is, more than likely, the future is going to be composites of services operating on multiple different cloud-like instances, including on premise. And who's going to offer the best end-to-end control plane? >> Paul, I want to get your thoughts. Cause you remember goin' back to the days, IBM had SNA network stack, DEC had DECnet, we had, they had propietary stacks. Cloud, Azure stack, this stack, that. Are we seeing this again? Your thoughts. >> Well I think Peter's absolutely right but the variable, and you're right, we are seeing this again. We're seeing a trend of return to simplicity. Because what IT organizations have been wrestling with for the last 20 years is everything is just getting more complex. There's more vendors, there's more piece parts, and they've got to fit them all together, and it sucks. And so they want someone to simplify this. Now, cloud vendors simplify it on one level. But software-defined, on another level. We've been talking here about software defined storage, about software-defined networking, massive virtualization. And that's on an open source or at least an open API-based model. Which I think is the twist here. Are we going back to the days of IBM? Yeah. But IBM, But the IBM may actually be software-defined. >> Or five different companies that look like IBM. >> I know what you're saying Paul, and I'm not going to disagree with you. But here's the opposite-- >> But you disagree with him. >> No, no, but no I'm not going to, I'm going to put a slightly different spin on it. It used to be that the most valuable asset in an IT organization was the mainframe. And the entire organization was organized and the interactions with the business were organized and put in place to handle the value of that mainframe. We are not going back to a day where the IT organization, the way business uses IT is organized around the mainframe as an asset. Or even around the provision of infrastructure as an asset. We are going to start seeing organization and frameworks that are fundamentally built around this idea of data as an asset. And that is going to be a lot more complex with a lot more buyers and a lot more opportunities for differentiation creating value. So we will see more complexity in IT at the software and the use case level, less complexity at the infrastructure levels. >> Which is why machine learning and automation gets a lot of hype, but to Paul, I'm going to get your point and tie Peter's point together and introduce Jeff Bezos' comment last week on NDC. He mentioned that most things take 10 years to bake out in terms of getting things right. Ten year kind of horizon. Kind of an order of magnitude. But he says, "All these startups say they have "disruptive technology, it's not their technology that's "disruptive, it's what's the customer is disrupted." So we're talkin' about customers being disrupted. It's not some company having disruptive technologies. >> And disrupting. >> So are we saying that customers are being disrupted by reconfiguring their businesses, hence with the mainframe disrupted, a new way to do things, we're seeing clouded-data as a new way to do things. So, that's causing some reconfiguration and disruption, allows them to say, "Shit, just when I thought it was simple "it got more complex." >> But the disruptive element is the data as Peter says. >> I mean the machines are becoming, the machines are already a commodity. The, with open source, the platforms are a commodity. What's disruptive is how you use the data in different ways. And to your point Peter, yes, it's going to be a much more complex world. >> Peter: Much more. >> Because there's a lot more data and there's a lot more things we can do with data. >> And data can, that's exactly right. We can do so much more with data. So again, let's go back to the fundamental metric that at least I suggested. Who gets more customers? There are going to be more buyers of this stuff in five years than there are today. More buyers in the sense that within an organization, there's going to be more people involved in the decision and there's going to be more businesses. Because if this stuff actually works, the transaction costs are going to go down and you can then organize your businesses, institutionalize how you do work differently so you can have more partnerships. All that means that fundamentally, what we're talkin' about here is going to lead to greater complexity in business, greater opportunity therefore, but what I've always said, and I don't know if you've heard this Paul, but I know you have John, and I've said it on theCUBE. That the fundamental demarcation is that the first 50 years of this industry featured known process, unknown technology. And what do you we focus on? The technology. What's the next 50 years? Unknown process, known technology. What are we going to focus on? How to build that software, how to handle those data assets. What are we going to focus less attention on? The technology. What does everybody want to talk about at this show? >> The technology. >> Technology. That's a disconnect. So going to one of the things that we now have to think about from a DELL/EMC standpoint is where's the story about how Dell is going to appreciate the value of your data assets over time. We need more of that. >> And let me point out, you now, you didn't mention IBM but one company that is doing that well right now, they aren't getting the business benefit for it yet, is IBM. Where they are really taking, they are not technology, I mean they don't talk about power aid anymore. They talk about Watson, they talk about what you can do with analytics, they talk about a smarter planet. They haven't been able to turn this into a successful business yet but they're doing, I think, exactly what you're talking about. >> Well the product, they have some product challenges. I mean, so let's get back down to the customer thing. I like that angle. You got to have the customer, you got to have the products that customers will be buying. That's the value, exchange that customers will value and then hence by your service or product. Andy Jassy and Pat Gelsinger, when they did the Amazon deal, VMware. Jassy, Andy Jassy CEO of AWS said to me, "We are customer focused." So I believe that you're right on this 100%. Whoever can get the customers. And this is not about who's the better stack, if the customers like it, they're going to buy it. >> And very importantly, John, they are going to invest in it to make it valuable in their business. And that's what you want. You want to see your customers become a centerpiece of value-creation in your ecosystem. >> And I think Amazon Web Services proves that the dark horse could come out of nowhere and be the behemoth that they are because they served the customers. >> So that's the second thing that I'm missing at this show. And I know, I think I know why, is where is the additional details, even a little bit more, about VMware and AWS. Now, I know that they're going to wait for the VMware World, that's the story. >> They showed a little preview in the keynote, it's still baking out. >> Yeah, but it would be nice to have a little bit more. >> That's one of those tough relationships they need to manage, right? >> Yeah, exactly right. >> I mean VMware and IBM also have an alliance. They are allied with their foes now through the acquisition. The point about, about the value of data, you know, I think Amazon has done a good job of building platforms that are very flexible for customers to use but they abstract a lot of the underlying complexity. >> Alright, so with the data, I want to just double-down on that for a second and get your reaction, thoughts on, obviously, one of the themes here is IOT and we heard Michael Dell saying it's going to be centralized, pushed out to the edge, you got in research from Wikibon intellegent edge. You and David Floy and the rest of the team doing some real amazing work at Wikibon.com. Check it out, subscription required. What's the edge strategy? What does that actually mean for IT practitioners out there? It's, certainly we heard from Bask Iyer, who's the CIO of Dell said, "Most CIOs are conservative "and don't usually jump on these waves." They missed mobile, they missed some other waves. His mandate was, CIOs, don't miss the IOT wave. So what is the IOT, this edge of the network thing mean for a CIO. >> Well, the first thing is in hardcore circumstances, many CIOs aren't even involved in the edge. So if you take a look, if you go into where a lot of the edged domains are really crucial, you see a plant manager that's more responsible for what's going on in the edge than the CIO. The CIO is handling the corporate systems. The plant manager is handling what's actually happening at the edge. The operational technology stuff. So the first thing is we're going to see a slow circling of the IT and OT organizations about who's going to win-- >> OT meaning Operational Technology. >> Operational Technology. Just as we saw a slow circling back in the 1990s when TCPIP came in, and blew away DEC and blew away everybody, and started blowing away the TELECOM divisions, or TELECOM's functions within side large enterprises. >> So you think that IOT is going to be as disruptive as TCPIP was in standardizing in the network layer. >> Oh absolutely, absolutely. It's going to be, it's going to have an enormous impact because there's so many new sources. The data is going to have, how to think about it, and that was the second point I was going to make, John, is we do not currently have architectural standards in place for thinking about how this stuff is going to come together. And it's something that David Furrier and I and the Wikibon team are working on and I hope to come up with, I hope to come out with some research, actually probably next month, on what we call automation zones or data zones or probably edge zones. Which is, how do, just we think about security zones today, how do we think about edge zones. Where the edge zone is defined by a moment, an automation moment, cannot have data outside of that zone. And that needs to become an architectural principle where OT and IT can work together and say, "What data has to be in that zone? "I'll make sure my data gets there, "you make sure you're data gets there. "We'll figure out how control happens, "and that's how we drive this thing forward." >> Well, just to give you a prop here on theCUBE here is, Wikibon was right about Flash, they were right about Hyperconvergence and convergent infrastructure. Big bets early on that were kind of like, people were like, "What?" And certainly Vstand, ServiceStand although some people will disagree with this. >> They were right about the edge. >> Now you're right about, I think you're right on, way right on the edge and you're way right on value of data. >> Yeah. >> I think those are two stands that you're taking that will be-- >> And let's give great props to David Furrier who was a catalyst for thinking many of these things through. >> Alright Paul, final word from you. Obviously, you know, as a veteran, you've covered it all. Okay, what's your take? I mean, what's the, how's the wind blowing, what's your instinct tell you of what's happening. >> I think it's generally good, but it's hard to tell from conferences. As you know John, the reason most conferences are so boring is that there's no tension, there's no conflict. It's all good, it's all everybody's happy and everybody's doin' a great job. That's the very same thing that we're seeing here. >> Rah rah, Kool-aid injection. >> One thing I can't help notice is on the keynote, if you look at the keynote agenda for the three days, there's not a single customer on the, on the keynote agenda. Which I think is a problem. Or I don't think that says good things about where Dell is really focusing it's message right now. You want to have, at most big company conferences, there's lots and lots of customers who come up on stage. I think Dell is still thinking about, I mean it's a technology-focused company. They're thinking about technology integration right now. >> So speeds and feeds. >> Yeah, you hear a lot of speeds and feeds. >> Everybody wants to be the most important thing in the enterprise, and they still want hardware to be the most important thing. >> Well, I think I mean, I would agree with you 100%, but I just think, just, in this acquisition, I mean, sorry, merger of equals, they have a lot of herding cats going on right now. There's a lot of herding of portfolio and not a lot of overlap but I can see them kind of making room on the stage for that. But I do agree, I mean, customers do tell the best story. >> And in the long run, that's, as Peter said, that is what is going to make the difference. Are the customers happy? >> Guys, amazing exchange. Thanks so much, Peter, for comin' out and takin' some time out of your busy schedule to come on theCUBE and share your insight. The daily on-cue Paul, as always, we're havin' another three days. Third day of our three days of coverage here on theCUBE. Great commentary, great analysis, more live coverage from day three of Dell/EMC World 2017. We'll be right back, stay with us, we'll be right back after this short break.

why from the mandalay bay convention center in las vegas it's the cues covering vmworld 2016 rock you buy vmware and its ecosystem sponsors we are here live in las vegas at mandalay bay in the hang space at vmworld 2016 this is the cube silicon angles flagship program where we go out to the events that extract the signal from noise i'm john for my host John Tory with tech reckoning our next guest is vegetable Shan who is the senior director of product management at HP storage HPE storage EP enterprise welcome back to the cube good to see you hey John good to see you you guys obviously a big partner with VMware in the ecosystem is the update men all flash all the time it's a flash crazy world now yeah if you want to talk about flash you know so to your earlier comment about vmware partnerships we work with them vmware community across many different areas right flash storage being one of them key one just because many of these virtualized environments today depend so heavily on the storage and flash makes it a very very attractive option for four people running virtualized environments so talk about where it's all fitting in with vmware for you guys after you you know the three par success story dave vellante always raves about the best knowledge is HP's ever done is a gift that keeps on giving as he always says now with the all-flash side of it how is it impacting the data storage data protection all the integrated stuff that the customers are looking for is to change the game a bit or what's just i think you know if I if I may there's the core of an all-flash offering right and if you brought down the core you can say it's about performance it's about affordability right and clearly when all flash started performance was the key then there was the affordability wave and then there's even now what you would call data services way it's right where the ability to do snapshots or quality of service so I would mark those as the core then you could ask other table stakes sorry those are those tables say say you go thank you table stakes yeah and then some other question is if we look outside the core because the core is pretty much understood today right there's still lots of things outside of the core so for example how do you protect the flash array right how do you do data protection in a bit of a flash because the considerations are different your performance is different your application characteristics at difference so what I do a data protection that's one aspect the other aspect is your infrastructure right your host connectivity you know your bottleneck used to be storage you'll eliminate that bottleneck where is the bottleneck now is it on your host pipes and then the third thing I'd say sort of outside the core would be you know there are new environments coming up containerized environments are an interesting place where you may develop on one environment and choose to deploy in another in these cloud native apps again how does a flash array operate in those kinds of environments so outside of the main court a lot very interesting areas to look at about HP enterprises and specifically don't want the flash the data protection in the host side connectivity not so much the storage or talk about the difference of those areas and now they all work together yeah so let's look at the data protection first right and so what are the attributes of data protection that matter in a flash environment first of all how often are you taking your data protection snaps for example are you using snapshots do you go direct to a backup device what is the latency impact in taking the backup what happens to your backup windows how do you restore quickly if you are snapping every hour on the hour do you go back with the full backup apply incrementals can you do synthetic folds so lots of different elements here and I think the point of view is you could take back up from a point of view I've got to back up my entire environment I vmc array of IBM arrays of HP arrays have a whole environment here to backup right or you can say hey in my flash environment how do I ensure it's optimized just like what veem did with you know virtualize backups right they took a very specific approach not the same thing can be said with data protection and flash do you see so put the story for primary storage yeah how do you distort change then as you're backing up to another flash device RP are you saying that look in the field so so that's interesting you say that because you have different choice points now right so i could have to prime arrays replicating each other that I could be backing up the secondary array to addy duplicating device that's one option the other options I could be having my primary array backing up to a deduplication device and replicating the deduplication level or the device level here or I could be replicating at the host level so I think there are different choice points question is how do you choose one versus the other and their trade offs right there sort of pros and cons um and and you want to be able to offer the customers that choice as well as the guidance as to when you would do one versus the other I love the way you're talking about generations we've gotten to this one this core system now of this generation of solid say yes but there's all these other technologies coming down the pipe we talk a lot about nvme and connectivity and we talk a lot about 3dx point and that's going to change everything where do those fit into the this framework that you that you've been talking about so you go back down into the core and look at performance right because there's got to be a performance next that's our industry it never stays the same right things always move and so the key to looking through those technologies that you asked about John is to look at sort of the n to n path of an i/o and it starts from an application it traverses some kind of fabric it gets to what I would call a controller fabric on the storage side and then from that control of fabric weather data is processed dee doop compress for example it gets written to back-end right and so you have to look at that end-to-end path so some of the technologies that we've been talking about talks about the different points here so nvme as a back-end connectivity for back-end media to the controllers that significantly cuts the lengthy down now but if you look at the latency envelope today the lion's share of the length C is not with the SAS protocol back end its with the media right and so if you did nvme you want to pair it up with storage class memory to get the benefit of that latency and then you want to ensure as well that you are talking say nvme over fabric to your host so that the protocol delays there go away and so again here you can see how envy me impacts choice of media choice of host connectivity so you get that end to niño optimization talk about what's next for flash performance specifically across the host fabric controller fabric and the media back-end fabric yeah so I think you have to then figure out now as in all emerging technologies there's probably going to be different choice points right so we look at a host to front end storage port connectivity that traditionally has been fibre channel we are seeing a rise of I skazhi and ethernet so the question is what does that do with when 25 Giggy 25k Ethan it comes to play right do we see a shift there a tip there maybe I don't know I think again you want to be able to offer choice points and if you can reduce that whole plane see using Ethernet technologies I think that's going to be a segment of the market that's gonna be very attracted to it we've been diving down deep into the technology stack I'm curious if you're seeing the buying center shift as we get to more integrated virtualization teams cloud teams do you have to talk about these technologies down to them and to understand how to buy storage so yeah so that's a very interesting point because there is a segment of the market that says hey I am looking at a vm level or an application level right and I and I don't want to associate all the different component metrics so I think that's the growing trend and hyper convergence for example is a perfect example of that where people want to look at the vm level or even at the application level and you know as we get more and more entrenched in two lines of businesses wanting to develop key competitive capabilities we need to be able to do what exactly what you just said what's the hpe story now that now that you're HPE storage is an important component of what you what you all are doing us I mean in relation to what John was asking what's the future what's the future looking like it you guys talking about in terms of your storage platform so the opportunity for us is to bring you know the collection of different technologies to bear on our customers and I and I view it as two things so job one is for us to be the best storage vet out there in the world if i took that storage myopic view of things right but we're not a small company where a large company and so that's a job to that says how do we the storage and the server and the networking and the compute play together right so we've got to bring the one plus one plus one equals five story and that means the opportunity HP can bring right whether it's things like composable infrastructure where you can say look i have one set of infrastructure for mission-critical applications one set for my cloud native applications why should i have two infrastructures for that i should have one infrastructure that allows me to compose the elements as I see fit for those environments some of them have different attributes I shouldn't have to have different sets of infrastructure to do both nothing to me that's a great opportunity we can bring to our customers about HP Enterprise now and storage give us the update was going on in the business office of the vmware ecosystem thin strategic you guys again like you mentioned been there for a very long time been a big big big partner of vmware but how's business in general at HP enterprise storage business what's the update what's the shiny new toy what's the where's the meat and Wiz what's going on you accepting yeah so so from an HP storage perspective clearly all flashes one of the rock stars there we're doing great with all flash good traction we're seeing a lot of interests around software-defined storage and hyper convergence and you know it's interesting on the software-defined side we've taken the same approach as we as well take on the primary side because we offer now what we call a common data fabric where you can deploy software either in a running on a proliant server or blade server you can deploy that same software as an appliance if that's how you want to consume it you can deploy it as part of a hyper converge packet we even offer it's part of our Helion OpenStack cloud distribution private cloud distribution so again bringing one technology one offering that can span multiple shape and form factors help make it simple for the customer otherwise they're going to do or deploy 13 different things so final question fish as a veteran of the tech business industry hace storage is your focus here at vml what are you taking back with you home as a key walk away item from vmworld share with the folks what you're learning what's that what's the vibe what's what's what are you going to take home with you as a walk away pretty much vehicles always been a great show right it's probably the one place where you know it's got such a rich ecosystem of vendors such a rich ecosystem some offering both complimentary and competitive so you know we have the stone we called frenemy right you're a friend in some places an enemy in others which is great because it just gives you places to collaborate and give new capability to your customers the vibes great at vmworld very rich ecosystem they're doing a lot of great technology innovations in cloud and software-defined we partner in Maine spaces we compete in some yeah but hey that's just the way the cookie crumbles and customers one choice fish thanks so much for sharing your inside the cube great to see you see at HP discover coming up in London in December yes right i think it's december or is that it's quite not much of a neighbor okay and yeah right yeah so big events european version of hpe discover which we just had an amazing set of interviews the cube was there could still get an angle website web site com or youtube com still gonna go check out the HP Enterprise discover videos tons of storage videos with all the big dogs on there thanks we spending the time now here I am world thank you if we are live at the mandalay bay in the hang space at vmworld 2016 john free with john schuer with tech reckoning we write back you're watching the cube

fly from the mandalay bay convention center in las vegas it's the q's covering via world 2016 rock you buy vmware and its ecosystem sponsors now here's your host John furrier hey welcome back everybody live here in Las Vegas the Mandalay Bay it to hang space at vmworld 2016 here in Las Vegas I'm John for John Truett tech reckoning you watching the cube our next guest is Patrick Osborne with HPE Enterprise HP Enterprise welcome back to the cube thank you yeah always great to be back here on the cube gotta love the energy day to rock and tonight's going to be the big night but you know day three and last night what coverage big unless that's just a opening night you know it is if one sees each other great show here vm roll out see the open ecosystem number one message we heard out of michael dell's mouth pat kelson is banging hard cross cloud which has been an HP strategy quite frankly for multiple years yeah see you guys in the middle with all the storage talk about your view on that ecosystem what's going on yeah i mean it's a huge very important ecosystem for us at HP we've been a partner of vmware for i think we're going on 16 17 years at this point right so we are definitely one of the the largest infrastructure partners for vmware and it's part of from a storage perspective it's a huge part of our ecosystem so everything from software-defined hyper converge 3par all flash all the data protection offerings a lot of that sits within the vmware ecosystem so huge partner for us and i don't see that changing okay so give us the update on the storage world obviously with the keynotes today you saw v san is exploding with depth vmworld urine product management so you have to kind of set the roadmap any changes errors has there been a lot of movement on the roadmap relative to the key features that cuz one obviously flashes Q you see that but what's going on in the product management side because it's kind of a moving train it seems to be gravitating around software for virtualized storage or storage as a service but what's the main points on that you're seeing the ships and where is it settling yeah so I from from my perspective from a product management view you know we were more of a software development organization in storage than we ever have been so the days of bending sheet metal and qualifying parts and making you know custom hardware is that's not the focus right the focus is in the software so you know when they talk about hyper converge the values in the software even when we talk about great operating systems and platforms like 3par all the value that is in the software so from us you know we gotta keep pace with some of the innovations there and it's clear that you know customers want the option of storage co-located with their compute and you know we do that through partnerships with vmware we have our own intellectual property on our own offerings around storevirtual and some of the hyper converged offerings we have so for me that from a product management standpoint that is definitely shifting into software very quickly talk a little more about storevirtual I'm very fascinated by the hyper converged market how it's developing the kind of customers that are that are you're seeing out there what are you seeing as the target market in the end the road map here that that we're seeing in front of us for hyper convergence original particular store virtual is a key component of that roadmap going forward for us we use it as an enabling technology for a number of form factors which is really important for us it's not just a virtual storage appliance that you bring your the software and then you bring your own x86 servers with different kind of media we use it for for example like two weeks ago we just launched a an arm-based I'll callable I scuzzy and fibre channel array right that's based on store virtual we can take that same intellectual property you can build your own software-defined hyper converge platform with that same IP we actually take that and embed it in appliances so we we have our own hyper converge offerings like the HD 380 so for us it's like this core piece of our software defined strategy that has a bunch of different formats that you know meet different use cases for customers in terms of the appliance kind of that market how are you seeing what what is the market for that who what kind of customers are you saying for that kind of um so storevirtual has been around for for some time we've got a number of deployments in different incantations we probably had over 250,000 deployments of that technology in the field and what we see is that some customers who have gone and let's say built their own hyper converge right so they're aggregating storage across multiple servers for virtualized storage that takes a degree of work to do that on your own right so some people like to do that some people don't and then they move to an appliance experience which for the HD 380 for example you can have that thing up and running and provisioning VMS in 15 minutes so having the ability to deliver from the factory a track scale a number of hyper converge appliances for folks that are doing at that scales it's pretty important right so we see customers who want that ease of use that simplicity you don't get as many knobs right in customization right but at the end of day do you really need that right so the 15 minute no nerd knob thing how important is that to you in terms of product management is that the future of the direction um for some customers yes right so it depends on which kind of custom you're talking about and which segment right if I'm let's say a smaller customer or i'd say like or even a remote office you know that doesn't have a lot of trained IT staff and they really know for example vmware right you want to make it as simple as possible you don't want to break context out of the UI that you use the most going to be they'll do all those tasks there so from a simplicity standpoint that's what you need when you need scale right and you need to be able to tune things for specific workloads then you want knobs right and to be able to provide both those form factors it's kind of unique for store virtual how do you guys approach now the vmware ecosystem has its as its evolving with the cloud you saw IBM cloud on stage sales scores on there today obviously very open open ecosystem is what they're really really working on what areas are you guys tweakin with vmware going forward with the key key intersection point so for us I you know we want to provide customers choice on the platforms so you know you're very you know well aware of our compute line right we've sell a dl 380 every time a baby's born and so you know we want to make sure that for our customers who are choosing vmware our infrastructure is the first of choice right servers networking storage and we want to put as much context into the VMware management plane you know to make that very simple for them to use and stand up in terms of strategy around some of the areas of plug it's Ron the management so being able to plug in to our one view infrastructure management plane and being able to support all those functions within VMware's it's pretty important to us in terms of the VMware ecosystem and training and ableman buying center are you as a product manager having to direct more of your attention again to the to the virtualization admin versus the maybe 10 years ago it was the storage admin absolutely so the days of dedicated storage admin especially a dedicated backup you know data protection admin even some of the folks on the networking side now right you have to be able to provide context within a virtualized world so a lot of that stuff is moving to other areas where you have I and screen capture in different places then you would break context and go into you know a storage widget or a networking widget or even go to your you know your favorite backup software so what we're seeing at HP is that we cus tomers are coming to us buying more vertically integrated systems so the whole kit and caboodle oh say I want a vertically orient you know integrated system from HP I want to buy another one from a you know another portfolio vendor and for us from a product management standpoint making all of those pieces work together seamlessly is the challenge right you want to drive as much complexity out of that it's possible where I don't have to rack servers I don't have to worry about fibre channel or I skazhi networking or VLAN tagging or all the things that go along with deploying a complex three-tiered architecture so for a from a product manager standpoint it's my goal to get those reduce those clicks you know keep the eyeballs focused on one simple Chris you you I that's that's the that's the Holy Grail about the customer environment right now what are the top conversations you're having with customers you can boil them down and what's the pattern that you're seeing is it changing is the narrative changed out so you guys have a great story with composable infrastructure love that messaging I came out of HP discover this year what so what are some of the substantive conversations can you rank them stack rank amor yeah they oh yeah hold the pattern people right so i need to you know i need to do more with less from an FTE perspective so i need to manage a in order of magnitude more infrastructure per FTE than i was doing three years ago that's you know that's a big one the second one is time to value so the days of entering a service ticket to get you know a full application stack to test you know your app your middle where your database and your storage that can't take 47 days anymore right you want to be able to submit that ticket and have an environment for your developers up and running within hours if not you know instantaneously because that's what they expect from the cloud right so that's a challenge for us we're getting some tweets here shop direct message one is I think this guy plays the Jazz so question is did playing jazz help your career in storage actually so yes very much so two on two fronts oh I play a lot of music so I'm up on stage a lot right so you better be able to bring it right when you got to bring the heat you got to bring the heat right and then you know from for jazz it's definitely you know you learn the changes right you learn the melody but you have to improvise right so at the end of the day you know and up in front of customers and obviously with two heavyweights like yourself you got to be able to do some tap dancing that's awesome well hey you know what and the cube is like a jazz band you're doing great step up in the big games it's always good to sit in you know it's kind of riff and see where the conversation goes up some style after you know go with the changes no real agenda just kind of get down yeah it's a good it's a good opportunity and it's good to see you congratulations all your success love seeing in person Patrick thanks for clearing the insights and storage final word what's your takeaway from vmworld just share with the folks what you're going to walk away with this year from the show every year I come here I think what L could you possibly do right you know you've seen it all but you every year I come here and it's you know whether it's a take on some older architectures like server-side caching with you know a company like de Triomphe or example or you see you know a high-end storage or reincarnated you always see some new stuff and people are doing new things where you didn't think there would be any space for any more innovation in this so that's for me as a kind of a nerd and a product manager and a tech geek like that I love that just seeing the new stuff every year yeah they definitely it's definitely a geek culture here at vmworld for sure that's why I love it and we are here breaking it down inside the cube at the in the Hang space on day two of vmworld 2016 I'm John forage for you be back with more you're watching the cube

>> Voiceover: Live from Las Vegas, it's theCUBE, covering Discover 2016, Las Vegas. Brought to you by Hewlett Packard Enterprise. Now, here are your hosts, John Furrier and Dave Vellante. >> Okay, welcome back everyone. We are here live in Las Vegas for SiliconANGLE Media's theCUBE. It's our flagship program, we go out to the events to extract the signal from the noise, we're your exclusive coverage of HP Enterprise, Discover 2016, I'm John Furrier with my co-host, Dave Vellante, extracting the signals from the noise with two great guests, Dr. Tom Bradicich, VP and General Manager of the servers and IoT systems, and Eric Starkloff, the EVP of Global Sales and Marketing at National Instruments, welcome back to theCUBE. >> Thank you. >> John: Welcome for the first time Cube alumni, welcome to theCUBE. >> Thank you. >> So we are seeing a real interesting historic announcement from HP, because not only is there an IoT announcement this morning that you are the architect of, but the twist that you're taking with IoT, is very cutting edge, kind of like I just had Google IO, and at these big conferences they always have some sort of sexy demo, that's to kind of show the customers the future, like AI, or you know, Oculus Rift goggles as the future of their application, but you actually don't have something that's futuristic, it's reality, you have a new product, around IoT, at the Edge, Edgeline, the announcements are all online. Tom, but you guys did something different. And Eric's here for a reason, we'll get to that in a second, but the announcement represents a significant bet. That you're making, and HP's making, on the future of IoT. Please share the vision, and the importance of this event. >> Well thank you, and it's great to be back here with you guys. We've looked around and we could not find anything that existed today, if you will, to satisfy the needs of this industry and our customers. So we had to create not only a new product, but a new product category. A category of products that didn't exist before, and the new Edgeline1000, and the Edgeline4000 are the first entrance into this new product category. Now, what's a new product category? Well, whoever invented the first automobile, there was not a category of automobiles. When the first automobile was invented, it created a new product category called automobiles, and today everybody has a new entry into that as well. So we're creating a new product category, called converged IoT systems. Converged IoT systems are needed to deliver the real-time insights, real-time response, and advance the business outcomes, or the engineering outcomes, or the scientific outcomes, depending on the situation of our customers. They're needed to do that. Now when you have a name, converged, that means somewhat, a synonym is integration, what did we integrate? Now, I want to tell you the three major things we integrated, one of which comes from Eric, and the fine National Instruments company, that makes this technology that we actually put in, to the single box. And I can't wait to tell you more about it, but that's what we did, a new product category, not just two new products. >> So, you guys are bringing two industries together, again, that's not only just point technologies or platforms, in tooling, you're bringing disparate kind of players together. >> Yes. >> But it's not just a partnership, it's not like shaking hands and doing a strategic partnership, so there's real meat on the bone here. Eric, talk about one, the importance of this integration of two industries, basically, coming together, converged category if you will, or industry, and what specifically is in the box or in the technology. >> Yeah, I think you hit it exactly right. I mean, everyone talks about the convergence of OT, or operational technology, and IT. And we're actually doing it together. I represent the OT side, National Instruments is a global leader. >> John: OT, it means, just for the audience? >> Operational Technology, it's basically industrial equipment, measurement equipment, the thing that is connected to the real world. Taking data and controlling the thing that is in the internet of things, or the industrial internet of things as we play. And we've been doing internet of... >> And IT is Information Technologies, we know what that is, OT is... >> I figured that one you knew, OT is Operational Technology. We've been doing IoT before it was a buzzword. Doing measurement and control systems on industrial equipment. So when we say we're making it real, this Edgeline system actually incorporates in National Instruments technology, on an industry standard called PXI. And it is a measurement and control standard that's ubiquitous in the industry, and it's used to connect to the real world, to connect to sensors, actuators, to take in image data, and temperature data and all of those things, to instrument the world, and take in huge amounts of analog data, and then apply the compute power of an Edgeline system onto that application. >> We don't talk a lot about analog data in the IT world. >> Yeah. >> Why is analog data so important, I mean it's prevalent obviously in your world. Talk a little bit more about that. >> It's the largest source of data in the world, as Tom says it's the oldest as well. Analog, of course if you think about it, the analog world is literally infinite. And it's only limited by how many things we want to measure, and how fast we measure them. And the trend in technology is more measurement points and faster. Let me give you a couple of examples of the world we live in. Our customers have acquired over the years, approximately 22 exabytes of data. We don't deal with exabytes that often, I'll give an analogy. It's streaming high definition video, continuously, for a million years, produces 22 exabytes of data. Customers like CERN, that do the Large Hadron Collider, they're a customer of ours, they take huge amounts of analog data. Every time they do an experiment, it's the equivalent of 14 million images, photographs, that they take per second. They create 25 petabytes of data each year. The importance of this and the importance of Edgeline, and we'll get into this some, is that when you have that quantity of data, you need to push processing, and compute technology, towards the edge. For two main reasons. One, is the quantity of data, doesn't lend itself, or takes up too much bandwidth, to be streaming all of it back to central, to cloud, or centralized storage locations. The other one that's very, very important is latency. In the applications that we serve, you often need to make a decision in microseconds. And that means that the processing needs to be done, literally the speed of light is a limiting factor, the processing must be done on the edge, at the thing itself. >> So basically you need a data center at the edge. >> A great way to say it. >> A great way to say it. And this data, or big analog data as we love to call it, is things like particulates, motion, acceleration, voltage, light, sound, location, such as GPS, as well as many other things like vibration and moisture. That is the data that is pent up in things. In the internet of things. And Eric's company National Instruments, can extract that data, digitize it, make it ones and zeroes, and put it into the IT world where we can compute it and gain these insights and actions. So we really have a seminal moment here. We really have the OT industry represented by Eric, connecting with the IT industry, in the same box, literally in the same product in the box, not just a partnership as you pointed out. In fact it's quite a moment, I think we should have a photo op here, shaking hands, two industries coming together. >> So you talk about this new product category. What are the parameters of a new product category? You gave an example of an automobile, okay, but nobody had ever seen one before, but now you're bringing together sort of two worlds. What defines the parameters of a product category, such that it warrants a new category? >> Well, in general, never been done before, and accomplishes something that's not been done before, so that would be more general. But very specifically, this new product, EL1000 and EL4000, creates a new product category because this is an industry first. Never before have we taken data acquisition and capture technology from National Instruments, and data control technology from National Instruments, put that in the same box as deep compute. Deep x86 compute. What do I mean by deep? 64 xeon cores. As you said, a piece of the data center. But that's not all we converged. We took Enterprise Class systems management, something that HP has done very well for many, many years. We've taken the Hewlett Packard Enterprise iLo lights-out technology, converged that as well. In addition we put storage in there. 10s of terabytes of storage can be at the edge. So by this combination of things, that did exist before, the elements of course, by that combination of things, we've created this new product category. >> And is there a data store out there as well? A database? >> Oh yes, now since we have, this is the profundity of what I said, lies in the fact that because we have so many cores, so close to the acquisition of the data, from National Instruments, we can run virtually any application that runs on an x86 server. So, and I'm not exaggerating, thousands. Thousands of databases. Machine learning. Manageability, insight, visualization of data. Data capture tools, that all run on servers and workstations, now run at the edge. Again, that's never been done before, in the sense that at the edge today, are very weak processing. Very weak, and you can't just run an unmodified app, at that level. >> And in terms of the value chain, National Instruments is a supplier to this new product category? Is that the right way to think about it? >> An ingredient, a solution ingredient but just like we are, number one, but we are both reselling the product together. >> Dave: Okay. >> So we've jointly, collaboratively, developed this together. >> So it's engineers and engineers getting together, building the product. >> Exactly. His engineers, mine, we worked extremely close, and produced this beauty. >> We had a conversation yesterday, argument about the iPhone, I was saying hey, this was a game-changing category, if you will, because it was a computer that had software that could make phone calls. Versus the other guys, who had a phone, that could do text messages and do email. With a browser. >> Tom: With that converged product. >> So this would be similar, if I may, and you can correct me if I'm wrong, I want you to correct me and clarify, what you're saying is, you guys essentially looked at the edge differently, saying let's build the data center, at the edge, in theory or in concept here, in a little concept, but in theory, the power of a data center, that happens to do edge stuff. >> Tom: That's right. >> Is that accurate? >> I think it's very accurate. Let me make a point and let you respond. >> Okay. >> Neapolitan ice cream has three flavors. Chocolate, vanilla, strawberry, all in one box. That's what we did with this Edgeline. What's the value of that? Well, you can carry it, you can store it, you can serve it more conveniently, with everything together. You could have separate boxes, of chocolate, vanilla, and strawberry, that existed, right, but coming together, that convergence is key. We did that with deep compute, with data capture and control, and then systems management and Enterprise class device and systems management. And I'd like to explain why this is a product. Why would you use this product, you know, as well. Before I continue though, I want to get to the seven reasons why you would use this. And we'll go fast. But seven reasons why. But would you like to add anything about the definition of the conversion? >> Yeah, I was going to just give a little perspective, from an OT and an industrial OT kind of perspective. This world has generally lived in a silo away from IT. >> Mm-hmm. >> It's been proprietary networking standards, not been connected to the rest of the enterprise. That's the huge opportunity when we talk about the IoT, or the industrial IT, is connecting that to the rest of the enterprise. Let me give you an example. One of our customers is Duke Energy. They've implemented an online monitoring system for all of their power generation plants. They have 2,000 of our devices called CompactRIO, that connect to 30,000 sensors across all of their generation plants, getting real-time monitoring, predictive analytics, predictive failure, and it needs to have processing close to the edge, that latency issue I mentioned? They need to basically be able to do deep processing and potentially shut down a machine. Immediately if it's an a condition that warrants so. The importance here is that as those things are brought online, into IT infrastructure, the importance of deep compute, and the importance of the security and the capability that HPE has, becomes critical to our customers in the industrial internet of things. >> Well, I want to push back and just kind of play devil's advocate, and kind of poke holes in your thesis, if I can. >> Eric: Sure thing. >> So you got the probes and all the sensors and all the analog stuff that's been going on for you know, years and years, powering and instrumentation. You've got the box. So okay, I'm a customer. I have other stuff I might put in there, so I don't want to just rely on just your two stuff. Your technologies. So how do you deal with the corner case of I might have my own different devices, it's connected through IT, is that just a requirement on your end, or is that... How do you deal with the multi-vendor thing? >> It has to be an open standard. And there's two elements of open standard in this product, I'll let Tom come in on one, but one of them is, the actual IO standard, that connects to the physical world, we said it's something called PXI. National Instruments is a major vendor within this PXI market, but it is an open standard, there are 70 different vendors, thousands of products, so that part of it in connecting to the physical world, is built on an open standard, and the rest of the platform is as well. >> Indeed. Can I go back to your metaphor of the smartphone that you held up? There are times even today, but it's getting less and less, that people still carry around a camera. Or a second phone. Or a music player. Or the Beats headphones, et cetera, right? There's still time for that. So to answer your question, it's not a replacement for everything. But very frankly, the vision is over time, just like the smartphone, and the app store, more and more will get converged into this platform. So it's an introduction of a platform, we've done the inaugural convergence of the aforementioned data capture, high compute, management, storage, and we'll continue to add more and more, again, just like the smartphone analogy. And there will still be peripheral solutions around, to address your point. >> But your multi-vendor strategy if I get this right, doesn't prevent you, doesn't foreclose the customer's benefits in any way, so they connect through IT, they're connected into the box and benefits. You changed, they're just not converged inside the box. >> At this point. But I'm getting calls regularly, and you may too, Eric, of other vendors saying, I want in. I would like to relate that conceptually to the app store. Third party apps are being produced all the time that go onto this platform. And it's pretty exciting. >> And before you get to your seven killer attributes, what's the business model? So you guys have jointly engineered this product, you're jointly selling it through your channels, >> Eric: Yes. >> If you have a large customer like GE for example, who just sort of made the public commitment to HPE infrastructure. How will you guys "split the booty," so to speak? (laughter) >> Well we are actually, as Tom said we are doing reselling, we'll be reselling this through our channel, but I think one of the key things is bringing together our mutual expertise. Because when we talk about convergence of OT and IT, it's also bringing together the engineering expertise of our two companies. We really understand acquiring data from the real world, controlling industrial systems. HPE is the world leader in IT technology. And so, we'll be working together and mutually with customers to bring those two perspectives together, and we see huge opportunity in that. >> Yeah, okay so it's engineering. You guys are primarily a channel company anyway, so. >> Actually, I can make it frankly real simple, knowing that if we go back to the Neapolitan ice cream, and we reference National Instruments as chocolate, they have all the contact with the chocolate vendor, the chocolate customers if you will. We have all the vanilla. So we can go in and then pull each other that way, and then go in and pull this way, right? So that's one way as this market develops. And that's going to very powerful because indeed, the more we talk about when it used to be separated, before today, the more we're expressing that also separate customers. That the other guy does not know. And that's the key here in this relationship. >> So talk about the trend we're hearing here at the show, I mean it's been around in IT for a long time. But more now with the agility, the DevOps and cloud and everything. End to end management. Because that seems to be the table stakes. Do you address any of that in the announcement, is it part, does it fit right in? >> Absolutely, because, when we take, and we shift left, this is one of our monikers, we shift left. The data center and the cloud is on the right, and we're shifting left the data center class capabilities, out to the edge. That's why we call it shift left. And we meet, our partner National Instruments is already there, and an expert and a leader. As we shift left, we're also shifting with it, the manageability capabilities and the software that runs the management. Whether it be infrastructure, I mean I can do virtualization at the edge now, with a very popular virtualization package, I can do remote desktops like the Citrix company, the VMware company, these technologies and databases that come from our own Vertica database, that come from PTC, a great partner, with again, operations technology. Things that were running already in the data center now, get to run there. >> So you bring the benefit to the IT guy, out to the edge, to management, and Eric, you get the benefit of connecting into IT, to bring that data benefits into the business processes. >> Exactly. And as the industrial internet of things scales to billions of machines that have monitoring, and online monitoring capability, that's critical. Right, it has to be manageable. You have to be able to have these IT capabilities in order to manage such a diverse set of assets. >> Well, the big data group can basically validate that, and the whole big data thesis is, moving data where it needs to be, and having data about physical analog stuff, assets, can come in and surface more insight. >> Exactly. The biggest data of all. >> And vice versa. >> Yup. >> All right, we've got to get to the significant seven, we only have a few minutes left. >> All right. Oh yeah. >> Hit us. >> Yeah, yeah. And we're cliffhanging here on that one. But let me go through them real quick. So the question is, why wouldn't I just, you know, rudimentary collect the data, do some rudimentary analytics, send it all up to the cloud. In fact you hear that today a lot, pop-up. Censored cloud, censored cloud. Who doesn't have a cloud today? Every time you turn around, somebody's got a cloud, please send me all your data. We do that, and we do that well. We have Helion, we have the Microsoft Azure IoT cloud, we do that well. But my point is, there's a world out there. And it can be as high as 40 to 50 percent of the market, IDC is quoted as suggesting 40 percent of the data collected at the edge, by for example National Instruments, will be processed at the edge. Not sent, necessarily back to the data center or cloud, okay. With that background, there are seven reasons to not send all the data, back to the cloud. That doesn't mean you can't or you shouldn't, it just means you don't have to. There are seven reasons to compute at the edge. With an Edgeline system. Ready? >> Dave: Ready. >> We're going to go fast. And there'll be a test on this, so. >> I'm writing it down. >> Number one is latency, Eric already talked about that. How fast do you want your turnaround time? How fast would you like to know your asset's going to catch on fire? How fast would you like to know when the future autonomous car, that there's a little girl playing in the road, as opposed to a plastic bag being blown against the road, and are you going to rely on the latency of going all the way to the cloud and back, which by the way may be dropped, it's not only slow, but you ever try to make a phone call recently, and it not work, right? So you get that point. So that's latency one. You need to time to incite, time to response. Number one of seven, I'll go real quick. Number two of seven is bandwidth. If you're going to send all this big analog data, the oldest, the fastest, and the biggest of all big data, all back, you need tremendous bandwidth. And sometimes it doesn't exist, or, as some of our mutual customers tell us, it exists but I don't want to use it all for edge data coming back. That's two of seven. Three of seven is cost. If you're going to use the bandwidth, you've got to pay for it. Even if you have money to pay for it, you might not want to, so again that's three, let's go to four. (coughs) Excuse me. Number four of seven is threats. If you're going to send all the data across sites, you have threats. It doesn't mean we can't handle the threats, in fact we have the best security in the industry, with our Aruba security, ClearPass, we have ArcSight, we have Volt. We have several things. But the point is, again, it just exposes it to more threats. I've had customers say, we don't want it exposed. Anyway, that's four. Let's move on to five, is duplication. If you're going to collect all the data, and then send it all back, you're going to duplicate at the edge, you're going to duplicate not all things, but some things, both. All right, so duplication. And here we're coming up to number six. Number six is corruption. Not hostile corruption, but just package dropped. Data gets corrupt. The longer you have it in motion, e.g. back to the cloud, right, the longer it is as well. So you have corruption, you can avoid. And number three, I'm sorry, number seven, here we go with number seven. Not to send all the data back, is what we call policies and compliance, geo-fencing, I've had a customer say, I am not allowed to send all the data to these data centers or to my data scientists, because I can't leave country borders. I can't go over the ocean, as well. Now again, all these seven, create a market for us, so we can solve these seven, or at least significantly ameliorate the issues by computing at the edge with the Edgeline systems. >> Great. Eric, I want to get your final thoughts here, and as we wind down the segment. You're from the ops side, ops technologies, this is your world, it's not new to you, this edge stuff, it's been there, been there, done that, it is IoT for you, right? So you've seen the evolution of your industry. For the folks that are in IT, that HP is going to be approaching with this new category, and this new shift left, what does it mean? Share your color behind, and reasoning and reality check, on the viability. >> Sure. >> And relevance. >> Yeah, I think that there are some significant things that are driving this change. The rise of software capability, connecting these previously siloed, unconnected assets to the rest of the world, is a fundamental shift. And the cost point of acquisition technology has come down the point where we literally have a better, more compelling economic case to be made, for the online monitoring of more and more machine-type data. That example I gave of Duke Energy? Ten years ago they evaluated online monitoring, and it wasn't economical, to implement that type of a system. Today it is, and it's actually very, very compelling to their business, in terms of scheduled downtime, maintenance cost, it's a compelling value proposition. And the final one is as we deliver more analytics capability to the edge, I believe that's going to create opportunity that we don't even really, completely envision yet. And this deep computing, that the Edgeline systems have, is going to enable us to do an analysis at the edge, that we've previously never done. And I think that's going to create whole new opportunities. >> So based on your expert opinion, talk to the IT guys watching, viability, and ability to do this, what's the... Because some people are a little nervous, will the parachute open? I mean, it's a huge endeavor for an IT company to instrument the edge of their business, it's the cutting, bleeding edge, literally. What's the viability, the outcome, is it possible? >> It's here now. It is here now, I mean this announcement kind of codifies it in a new product category, but it's here now, and it's inevitable. >> Final word, your thoughts. >> Tom: I agree. >> Proud papa, you're like a proud papa now, you got your baby out there. >> It's great. But the more I tell you how wonderful the EL1000, EL4000 is, it's like my mother calling me handsome. Therefore I want to point the audience to Flowserve. F-L-O-W, S-E-R-V-E. They're one of our customers using Edgeline, and National Instruments equipment, so you can find that video online as well. They'll tell us about really the value here, and it's really powerful to hear from a customer. >> John: And availability is... >> Right now we have EL1000s and EL4000s in the hands of our customers, doing evaluations, at the end of the summer... >> John: Pre-announcement, not general availability. >> Right, general availability is not yet, but we'll have that at the end of the summer, and we can do limited availability as we call it, depending on the demand, and how we roll it out, so. >> How big the customer base is, in relevance to the... Now, is this the old boon shot box, just a quick final question. >> Tom: It is not, no. >> Really? >> We are leveraging some high-performance, low-power technology, that Intel has just announced, I'd like to shout out to that partner. They just announced and launched... Diane Bryant did her keynote to launch the new xeon, E3, low-power high-performance xeon, and it was streamed, her keynote, on the Edgeline compute engine. That's actually going into the Edgeline, that compute blade is going into the Edgeline. She streamed with it, we're pretty excited about that as well. >> Tom and Eric, thanks so much for sharing the big news, and of course congratulations, new category. >> Thank you. >> Let's see how this plays out, we'll be watching, got to get the draft picks in for this new sports league, we're calling it, like IoT, the edge, of course we're theCUBE, we're living at the edge, all the time, we're at the edge of HPE Discovery. Have one more day tomorrow, but again, three days of coverage. You're watching theCUBE, I'm John Furrier with Dave Vellante, we'll be right back. (electronic music)

live from the sands convention center las vegas nevada extracting a signal from the noise it's the cube covering HP discover 2015 brought to you by HP and now your host dave vellante welcome back to HP discover everybody this is dave vellante check out HP discovered on social for all the social streams the video the content the special access patrick osborne is here from HP cube alum and he's joined by Bill Walker of 20th Century Fox gents welcome to the cube good thank you yeah thanks for having us discovering another discover a little different this year Patrick we got Meg talking about business outcomes and absolutely uber and their yeah all the kinds of some shit models are very different I mean obviously you come out here every year for the past number of years and you know it's all about the technology i'm always wowed by the broad you know portfolio that we have but really at the end of the day I think some of the messaging to the customers is you know we're here to help you solve your problems and parts of that is technology part of its services so this hot sort of new high-level messaging around transformation and helping people achieve these business outcomes I think it's a good fresh start yes so bill your business going through some interesting transformations yes today to talk about the high level the drivers in your business the yet new competitors you got you got huge opportunities to go into this digital transformation you've sort of early on in that so maybe talk about some of the drivers in your business sure absolutely I think for us you know you really hit the nail on the head in the sense that it's really been about the physical to digital transformation that the industry is you know kind of going through and also Fox is and you know on the infrastructure side and the IT side we're trying to support that you know as best we can and you know the name of the game lately has been speed to market right so we partnered very tightly with HP on not only the hardware but the software side in you know building out kind of a brand new digital supply chain environment in Las Vegas actually right here and one of our major data centers where we deliver all of our digital content to all of our providers so EST VOD providers like amazon and itunes as well as you know major broadcasters so you've got a facility out here that is essentially your your cloud yes yes we do that that's our primary place where we deliver everything out of its it's great we're using all HP hardware and software there so we're customers across the board in the sense that we have blades we've got three par we're using store once as well as the HP software stack like cloud system on top of that that part is part of a super nap yes yes so yeah we we're facility we're in super net we love it it's a great facility we moved there like a little over two years ago and it's it's been awesome experience that made it into the any of the movies no it must hey I know well they it's impressive on the outside and the inside right yeah was it the old member the robocop oh yeah they have that storagetek tape library way magnet yeah they were great at four days these impressive data centers look amazing so so talk a little bit more about the you called it the digital supply chain that's a powerful concept what's behind that yeah so you know we we've obviously been in the physical supply chain business for a while on the home entertainment side so thank DVDs you know blu-rays that kind of thing but as we transition from people buying physical media to digital media a lot of the workflows and you know the supply chain aspect of it is still there but now we're talking digital and not physical so one of the things we've done at Fox is we've you know we've created what we call our digital supply chain so you've got you know they not only you know things like content delivery in there but you've got you know watermarking you know all the all the hallmarks of what you would need in a in a digital environment to deliver that customer you know quality product from end to end and protect your IP yeah exactly where T is a big one so we'll talk about more about security data maybe there's a general topic and then let's go to dig deeper every good for sure I mean security is obviously one of our big drivers I mean obviously with everything that's been in the news lately we're no different in the sense that we take it very very seriously you know on the data protection front like I said we're big store wants customers we love the product we're using it heavily in our in our data center to protect our content as well as our data so how much time let's unpack that a little bit what's it what's it look like laughs so you said a bunch of different you know HP products can you can you help us to understand how much you know storage kind of servers what kind of apps paint a picture of your your infrastructure for sure so we've got you know a lot actually several racks of gear 3par like I said we're big three part customers so we have several racks a three part that we're using kind of across the board a lot on the database side you know and heiio scenarios storeonce is kind of that underpinning piece that everything funnels back to that provides you know data deduplication backup archival that kind of thing okay so can we talk more about sort of your objectives of protecting data I mean obviously don't lose it but there's you know time to recover there's data loss how are you approaching that yep so we we've got you know our primary facility at switch as well as a dr facility off-site we're using store once we r you know we've got them in both places we're doing replication both ways to ensure you know if we were to have a vent at one facility or we didn't have data available we can quickly recover from the other you know rtly is it's been a great success for us because we've moved from tape-based you know back up and i really didn't mention that but you know where we came from you know two two and a half years ago you know from our LA and chandler data centers we have very very heavy investment in tape infrastructure and one of the things we into decided when we went to this new you know environment in Las Vegas is we wanted it to be completely tapeless you know to be flexible right in that environment and you know we pick store once we went all disk-based and you know RTO wise is fantastic because you know as opposed to tape if you have an event if you happen to not have the tape on site your RT 0 is dictated you know kind of by when you can get the tape back with the exit yes yes fast as you can get here right with the store once though it's just there we can we can you know bring it back in minutes and in fact we actually had a kind of not funny but but interesting incident happened early on where you know we kind of had an hoops incident where somebody deleted a vm and you know with store once we already had it had it there we were able to recover it in minutes and have it working again which is not something we were able to do in in previous iteration so it's really RTO is your primary supposed to RP oh yeah and Patrick I'm sure you see it all over the board with with customers right i mean yeah absolutely i mean it is the whole environment is based on this digital content that it's the lifeblood of you know what they're doing as a business and what they're delivering you know to your customers so that what we're seeing in the data protection standpoint is that more apps are mission critical right they're moving from business-critical the mission-critical the RTOS and our feos are definitely more aggressive you know month by month quarter-by-quarter people are moving from days two hours to minutes and we want to have more they won't have access to more data that's near line and online for so you can basically restore that right away so we're seeing people architecting solutions for store ones where they'd want a couple weeks maybe a couple months of data stored on that from a vaca perspective now we're talking having conversations about three to five years seven years 10 years right so definitely a paradigm shift in terms of data protection and the clouds change that a lot absolutely how so talk about that I think you know because the cloud there's not really a concept of tape per se I mean I know you know some providers have a delayed you know a kind of recovery type mechanism but I think in general people are assuming you've got the data on disk or you know available somewhere and you're able to recall it right and you know almost any cloud provider I think today is structured that way and has some kind of object storage where you can back up to but it's an online situation right and I think that's kind of become the new the new standard for the expectation of you know it's dumping it into an object store an able to recover from that yeah i like to say backup is one thing recoveries everything so there's a software component that that's the good that and what about tape you using I mean you must be used tape in your business right we do still have tape but I think where it makes sense we're trying to get rid of it you know we obviously there's a lot of physical nature with tape you know for us it's also manpower you have to have you know it's a lot of manpower involved in just managing tape and whatnot so where we can especially strategically in our data centers we're trying to get out out of using tape and using you know just a long-term archiving long-term retention with your digital assets obviously you would take for that we definitely have scenarios at the studio where it's still used for sure yeah but not obviously not for backup no yeah yeah I think you know with my team we're starting to think of the the notion of backup maybe in the traditional sense it's kind of going away because I think what people think of backup they think tape they think these scenarios and I think it's you know it's changing to more of a you know having having various generations on disk so you have the concept of you know okay being able to go back in time but near real-time recovery a time machine for the enterprise yeah yeah we talk when we talk to customers it's usually around the areas of application data protection or a service data protection and then long term preservation of assets as opposed to backup and archive right so there because they have a very different business processes around them and you can apply different technologies to the two of them so in some some technologies are appropriate for one some are appropriate for the others so we're you know we're seeing a lot of customers really focus on day one of how I'm going to protect that data how I'm going to make data protection an automatic part of the infrastructure so I don't have to have separate backup team and separate you know specific processes this whole area of things being sort of automatically protected as part of the infrastructure is it's definitely worth a lot but I think that's a really important point to make data protection has historically been a bolt on right uh we got to protect the data yep and so you're saying that you're finally seeing customers integrate data protection as part of the fundamental solution absolutely the two things so the two things that now I'm seeing it from a fundamental part of the initial solution bill that is data protections built in right so you're seeing the techniques of snapshot and replication being melded with you know backup techniques like policy management indexing and all that kind of stuff right and then the other sort of conversation we're having with people who put infrastructure in place is how am I going to get off this in five years five to seven years right so because the amount the size of the data sets are becoming so big that replicating data data migrations migrating your backup data are there they're difficult the difficult task so people are doing a lot more planning ahead to understand how am I going to protect this data now right from a different set of scenarios and how am I going to start do some hardware lifecycle management from an infrastructure standpoint underneath that data as I go into the future are you a data protector customer what do you use not not currently although we are you know we are looking at it for sure yeah today we're actually net back up yeah yeah okay I mean it's a lot of ways to skin that kappa yeah that's still not in your group is it nope nice meg just make it but they have a saying this for a decade the data protect there should be a part of the storage solution I mean it's anyway we work with them every day fantastic I got a tight relationship yeah yeah I'm still get paid for it do get paid for it that's good okay well that's a start yeah yeah awesome alright let's see what else uh what's going on the show this year with you Oh lots of stuff of the show so obviously you you heard about flash right yeah we've heard a lot of flashes fam yeah it's great mokin fast yeah so there's a in it's funny there's a lot of implications to flash even on data protection right so this is a big area for us obviously is huge in the market the media and the speed in what flash brings to the table allows you to do some different things from Dave protection standpoint as well right so this concept of copy data management you've heard this in terms of now i can take copies of databases copies of data sets serve them up to uat test development environment so you know your speed of development by having access to copies of that you know of that original production data set is being enabled by media like flash no flash you can do lots of random i/o you can with with modern architectures like three par for example it's multi-tenant right you have quality of service on there so now we're in the past you'd have to clone a number of data sets copy them off restore them from backups for the purposes of having a you know a test data set now you can run all that on the same infrastructure so flash is great from a performance standpoint for you know speeding up your transactions feeding of your database your workflow but there's a lot of other things that allows us to do to help the overall speed of development which is kind of cool so the copy data management things interesting I mean yeah so active feos obviously popularizing it Dell fixes another one yeah the problem is they want me to rip out or not use my might reap are snapshots and I love my three parts don't want to put in a whole new infrastructure around it so is there I mean the opportunity you got a catalog in in-store wants maybe I could use that somehow that technology so that's what we're doing right so we're taking these techniques that you've had in traditional backup for years and then things you have on primary storage right snapshots and replication but with the with the advantages of flash now you're able to do a lot more with it and bringing those two techniques together we're doing it with software we're doing it with sort of extensible protocols and SD SDKs on the infrastructure itself so we're not introducing any sort of sand virtualization techniques or you know in line fibre channel you know type of virtualization technology we're allowing you do that as a part of the infrastructure itself so you know we're combining things like three par with Recovery Manager central and store ones to provide those type of experience I think the killer app they're Jews potentially is test dev right i mean if you can take copies that are more current give it to the especially with flash give it to the developers but they're not working on you know n minus three copies absolutely yeah and they're way more productive I know what kind of discussions are you having internal how do you service the developer community are they what kind of pressures are they putting on you bill yeah it's that probably the same things you've heard I mean you know agility speed I know for us you know because we're we're big on the cloud journey right now in terms of delivering you know private cloud services for our customers inside Fox one of the areas where we're actively really striving for is to do you know some deeper integration with some of the dev teams where they've got you know kind of closed loop cycles you know DevOps type cycles that they're developing with you know familiar tooling which you know is in the market that out there the Jenkins etc you know my team we're definitely working on trying to integrate a lot of the automation we're doing around cloud with what they're doing on the test dev site to kind of create a nice you know cohesive whole so you know rather than delivering just a server to them we can deliver an entire in a build environment and tear it down you know build it up and tear down dynamic flames so you mentioned a store once customer talked about RTO being really on the primary metric that you're trying to optimize waiting sir patrick comes out to California you know hits the beach makes a quick sales call writes it off wait what do you want to know from him yeah okay Oh with you that the time so what kind of discussions do you have with with Patrick around where you want to where you want to go what you want out of the product when I roadmap to the club yeah I think one of the things you know we're as I said before you know we're three par and store wants customers and I think we're where we see you know things headed in the future we'd love to see even deeper integration with three par and store once and you know we're actually having a discussion my team before this and one of the things they threw out there like hey why can't we just combine them into one product you know and I know right now they're separate but sure maybe maybe in the near future you know the the notion of having this this external device it's separate from 3par that you're you know moving to you know maybe maybe some of that gets melded together and what does that do for you it minimizes the need to manage another appliance absolutely right so it simplifies your your infrastructure tighter integration yep so better reliability and yeah I mean you know we're like a lot of technology shops in the sense that well we're trying to squeeze you know as much as we can you know with the team that we have in terms of Technology and still deliver a lot of services so you know we're always looking to if we can take two and make it one or you know that kind of scenario for simplification that's what we want to do too and more with less but no so let me ask you a question when you do more with less and you've dropped money to the CFO's bottom line today they carve off the you get a lick off that cone or they say hey they'll nice job here's a little you know we'll take twenty percent of that savings and give it back yeah it's I for us it's just the you know the slap on the back the handshake that we did it what are you seeing without me from our mothers hear from our product portfolio standpoint we're simplifying right we want to have I think we're in a unique position in terms of we want to be the best storage division inside of HP Enterprise right we don't want to be the best storage division standalone right so that affords us a lot of experiences for that we can bring to the customer when you bring in you know the blades and compute and networking and storage I mean what you see up on stage with one view and all of our element managers you know it's it doesn't sound sexy at the end of the day but basically having a same look and feel the same taxonomy that you use for all of our products is like a huge simplification for customers not having to you know learn new you is and why not so we have other competitors who you know they're bringing 7 10 12 you know different architectures for a primary storage the table right we're consolidating that and providing customers that the ability to they can go in a cost optimized software to find you know deployment model you can have appliances that are tuned in high performance same look and feel same CLI same utilities same data services so we want choice but it has to be simple because too much so what do you think about that whole software-defined mean is that the future is it this Patrick sort of implying sort of the the lower-cost sort of software only model what do you guys say yeah well we're big believers in software to find you know like I said we're we're kind of in it on you know on the whole stack in the sense that we know not only a part where we have software with HP we're also doing a lot with the team around Helion OpenStack right now and you know one of the big bets we're making is we think openstax going to be big we you know I know internally when we've talked with you know a lot of the development teams the idea of API defined infrastructure that's more malleable is tremendously exciting so what are you in with OpenStack well so right now we're actually we're kind of in that you know early stage entire ya des you know trying to trying to get a feel for it cuz you know one of the things I always say you know right now with OpenStack is it's kind of a two-way street you know there's the infrastructure part of it that my team has to deliver but the the other side of it is really the developers you know getting their hands around it getting a feel for it you know maybe even doing some platform-as-a-service with Cloud Foundry you know that kind of thing and they're really developing for that platform and getting the most out of it because you know in a lot of cases you know you're coming from a traditional environment where you know you had physical servers you put virtualization on top of it everybody's kind of used to that maybe a single VM kind of scenario but when you move to something like OpenStack you kind of got to rethink how you approach application building just think all right gents we're out of time going to leave it there but Patrick last last word for you why HP why HP I think we've got some exciting times ahead of us this year right so unlocking some velocity and value for for everyone with HP Enterprise kind of like just to echo what I said before about you know we're a portfolio company that brings a lot of technology services to our customers and at the end of the day my bet is that standalone companies that focus on one thing like storage or one thing like network or specifically compute I don't see a path forward for that over time right customers are buying solutions and systems and converged art you know infrastructure how you see this you know hyper converge theme right HP is one of the few companies that can bring all those elements to our customers as part of the equation so that for me that's why I stay here and why we've got such a great technology path forward yeah the 80s and 90s are about disintegration of IT and creating those silos and now we're seeing the reintegration so Patrick a bill thanks very much for coming on the cube absolutely thank you so much to have you guys here all right all right keep it right to everybody will be back with our next guest right after this short break you