>> Live from Las Vegas, it's theCUBE. Covering VMworld 2018. Brought to you by VMware and its ecosystem partners. >> Welcome back, we're here at VMworld 2018. You're watching theCUBE. Two sets, three days, over 95 guests. I'm Stu Miniman, my cohost is Joep Piscaer, and we've got a little bit of news to talk about. Lots of announcements made at the show. One of them is that VMware has purchased the intent to acquire Boston-based CloudHealth Technologies and I am thrilled to have back on the program, I've had him in my Boston-area studio and seen at lots of shows, Joe Kinsella, who's the founder and CTO of CloudHealth. >> Yes, you got it. Good to see you again, Stu, good to see you, Joep. >> Absolutely. >> Just to get it out of the way, the Boston Business Journal says for about 500 million. I know you can't comment on the dollars, but this is a big deal. 200 person company, as I said, Boston-based, right down the road from us. Heck, I'll stop at, your new headquarters is opening on Thursday, which I'm stopping at on the way back from the airport. Congratulations, first of all, and tell us what's the feeling like of your firm? >> It is exciting. We certainly weren't looking to get acquired, so as you know, we raised a fairly large D round last year and we were focused on building a big public company and what we found along the way of talking about a partnership with VMware was it was just a lot of synergy. Both vision, strategy, as well as cultural synergies. I think somewhere along the way we realized this made a lot of sense, so it is a big deal, and we're very excited about it. >> Awesome, Joe, one thing I like, I see you and your company at cloud shows. >> Yes. >> This is where we have, one of the things that excited me this week is we talk about, I'm a networking guy, talk about the networking, they're talking about multi-cloud the way that Nicira was pre-acquisition. VMware talking a lot more about multi-cloud. They had Amazon up on stage, and I think the acquisition of CloudHealth Technologies is, how does VMware become more of a cloud first? For people that don't know CloudHealth Technology, tell us a little about the origin, your founding, and where you play in the ecosystem? How much of a part is VMware today versus everything else? >> Without a doubt. I founded the company six years ago and it was, I was an early pioneer in the public clouds and the 2010-2011 timeframe I was building out large-scale public cloud infrastructure. Sounds a lot less impressive when I give you the numbers now, but then it was very impressive, and in the process of doing that just realized the incredible complexity that you had to confront to actually be successful in the public cloud. Both complexity of deploying and managing efficiently, that infrastructure, but also the complexity of all the tools that surround that management. So I set out with CloudHealth to build a single SaaS platform that customers could use to, what today you might call build out a cloud center of excellence, is kind of the terminology. Which is to have one central platform where you can centralize and distribute cost management, security compliance as well as proactive governance. All the way to integrating back into your back office and your service desk and your incident management. Make the cloud just part of how you deliver your business services. That was the journey six years ago, and it's been a tremendous journey to-date. >> You were definitely a pioneer in this, so congrats what you done. Cause I remember six years ago, come on, cloud was simple, I swipe a credit card and we'll just do this and everything. Now, everybody kind of understands not only cloud but especially multi-cloud, getting my arms around how I manage all this environment. Maybe touch on how does multi-cloud fit into this whole discussion and what does CloudHealth do with VMware today versus everything else? >> When I started the company, multi-cloud was part of the vision, but let's be honest, there weren't a lot of companies really doing multi-cloud. Usually, at best, especially in the enterprise, if an enterprise was even doing cloud they were choosing a single cloud provider. They really weren't trying to actually have multiple providers. I think what's happened is in the last 24 months is enterprises went from being a single cloud to pervasive multi-cloud, is what I call it, which is their portfolio now includes dozens of SaaS products, it includes multiple public cloud providers, it includes multiple private cloud providers, and it's just a very complex heterogeneous portfolio they're managing. We were built for that. It's finally come true and I think what it does is if you think what you need to be successful in that environment, if you're going to build out a cloud center of excellence across a pervasively heterogeneous environment, you need a single platform that does that for you. Today, our product supports Amazon, Google, Azure, and it also supports VMware, so it integrates directly into vSphere, does cost management, does inventory, visibility, as well as migration recommendations to and from multiple different public clouds. It's a great synergy between what it is that VMware does across its rich, robust portfolio and CloudHealth. >> Talk a little about the new possibilities you're now opening up, being acquired by VMware. What does that mean for that multi-cloud strategy? >> I think Pat touched on it in his keynote, and I thought he did a masterful job of describing how CloudHealth the brand will be kind of a core brand of VMware and this will be a centerpiece property across integrating across various different properties across their SaaS portfolio. But I also think VMware's very aware that there's a lot of choices that customers want. They may want to choose different products for log managing, configuration management, for application performance management, and I think we're going to continue to provide that choice to customers so that it won't be just a VMware-centric product. But at the same time, you look at the richnesses of VMware portfolio, which is, you look at what they do on-premise and you look at what they do around cost management inside the data center. You look at VMware on AWS as an offering. There's just huge potential synergies between what we do and how we can extend our value proposition into those areas much faster as part of VMware. As the founder of the company, what excited me about this was this was not taking me away from my vision, it was an opportunity to accelerate my vision, which is really what kind of got me there to this idea that we would be acquired. >> How do you think your product will help VMware, for instance in the VMware cloud on AWS. Do you think you'll integrate on that level to help VMware accelerate their proposition as well? >> Yes, I believe, I'm actually very excited about VMware and AWS because I think we all know that VMware's been optimizing its stack for so many years. There's incredible efficiencies that have been built in to it that I would like to bring up to a business perspective so that our customers can understand them and take advantage of them in an easier way. I think there's great potential there. I probably don't want to get over my skies too far here on this one, but I do think it's one of the things you'll see early post-close of this deal. >> Joe, I think the timing's really good. If this acquisition had happened two years ago, we'd be talking about vCloud Air. My joke would be to say when does the update come that says all migration should push you to VMware at 99.8% of the time? (Joep and Joe laughing) VMware, it's not only AWS. We saw the VMware presence at the Google show. >> Yeah. >> You're going to do Google Cloud Show and they're trying to position themselves more in this multi-cloud world, which is where your company sits. Joe, what advice do you give to companies that, software companies out there, how do they help customers in this multi-cloud work? It's a big environment. You help with a bunch of things, but there's licensing, there's all sorts of variability out there. I say it's this giant elephant there and you might have a main course of it, but there's lots of partners you need to work with and customers have the paradox of choice out there, so how do you as a software company be successful in this space? >> I think, myself as a software company or as our customers? >> What advice to you give to your peers out there and if you were giving Pat advice as to how do we be even more successful as a multi-cloud player? >> I think their strategy is very mature. That was one of the things that got me excited about it, which is, I think there was a time at which I think companies were very territorial about how they approached the pervasive heterogeneity that we're entering now, and I think being open in the way that they are, that all of the properties that customers may choose may not be a single vendor. There's going to be lots of different vendors and lots of different choices and freedom of choice, I think, is kind of one of the fundamental tenants of a successful strategy at this point in time. I would just highly encourage that for everyone which is I think the old world is the old world, now. We've entered a new frontier, we have to think differently, we have to act differently. I think what I really love about what Pat's doing is he's harnessing the DNA and the strength of VMware, which is just, they've been a tremendous provider of great software for two decades and kind of bringing it into the next frontier of cloud. I think they've got a lot to bring that we have not seen yet. That we're going to see over the next few years. I just hope to be a part of that. >> You mentioned the new frontier. VMware's still somewhere in between the old frontier and the new, so one of the problems we've seen in the past is VMware and its relation with the service provider world. What do you think you'll add to that mix to help service providers maybe move from the old world into that new world as well? >> Now, Joep, is that, that feels like a fastball down the middle. (all laughing) I just have to tell you. The relationship with VMware started 18 months ago. It started with an SVP at VMware and was all about partners. One of the things you might not see externally from CloudHealth is that there's really two products in CloudHealth. There's our direct product that we deliver to enterprises and SMB, and then there's a separate product that we sell to service providers and it enables them to deliver managed services to their customers on top of the cloud. We built it in a way where the products are really one product that actually are sold as two separate products. I think what we're going to bring is a real strong opportunity for partners across VMware, and that's why the opportunity, the business relationship started as a potential partnership around partners and eventually evolved into where we're at today. We're excited for that. I tell people that the cloud is the single greatest threat and the single greatest opportunity for partners. The difference between which one you're going to experience over the next few years is whether or not you can figure out how to harness the disruptive potential of the cloud. >> Sounds like I've got a question for Ajay Patel tomorrow when I interview him towards the end of the show. (laughing) Because yeah, it's service providers there. I know you can't talk a lot, but give us roadmap. What sort of things, is it like, I see NSX being pervasive. Are there integrations today? Do you have visibility in CloudHealth? Is that something from the networking side that you do or would tie into? I think back, I've been in this long enough, when EMC bought VMware it was here's all the cool stuff we could do and I was in engineering like oh my God, it's going to take us five or six years to do most of this stuff. >> Yes. >> It got done, but there's long, hard engineering work. 18 months, what can you talk about that's been done and give us a little bit of what should we be looking for? >> NSX is tremendous offering and I think what you see is, I'm really looking at this as more like tier one, two, and three integrations. Tier one I think you're going to see more around the cloud properties. Probably things like VMware on AWS and you'll see the SaaS products such as Wavefront and things like that. I think there's a natural extension and a natural movement and a natural value proposition we can bring on top of those. I think tier two you'll probably see a lot more hybrid, where you're going to see us kind of take advantage of that rich portfolio in VMware and extend it and add value on top of it to our customers. I think tier 3 I'll leave quiet for now, but I think there's some really amazing potential of what it is that we can do together based on what I'm seeing exist in VMware and things that maybe are being built that are not yet public. I think there's some really great potential of what we can bring to the market around how they can manage their multi-cloud portfolios in to the future. >> Joe, last thing I wanted to ask you. Boston-based company. VMware had a strong presence in the Boston area. I know a lot of people near Cambridge facility but talk about the tech scene in Boston, being a founder, you got a new headquarters, getting acquired, I'm a bit of a homer, supporting people so that I don't necessarily have to travel across the country or across the world. Give us your viewpoint on the Boston area these days. >> You know this, which is it is incredibly vibrant, what's happening in Boston, which is the businesses being built, the entrepreneurs that are there, the entire ecosystem is working at a pace I have not seen in over two decades. They're building real meaningful businesses. When you actually lift up the cover and you look at what these entrepreneurs are building, it's going to be an important tech scene for decades to come based on just what I'm seeing happen today. I look today and a lot of people like to give the credit to the person who founded the company. There's thousands of people who touched this business. Just including the tremendous effort from every person who joined this company. There's been people like yourself and people who've added value in many, countless ways along the way. It all came, primarily, from a Boston community that was there to support me and my company as we grew up in the Boston tech scene. I've been blessed to actually be surrounded by great people in one of the best cities in the world. >> Joe, congratulations again. >> Thank you. >> If you don't know, they even have superhero stickers of this guy that they give out at conferences. (laughing) >> Joe Kinsella, CloudHealth Technologies, congratulations to you. >> Thank you. >> I'm looking forward to seeing the grand opening back in Boston when I fly back after the show. For you Piscaer, I'm Stu Miniman, thanks so much for joining us on theCUBE. Be back with lots more. >> Thank you. (electronic tones)

(upbeat techno music) >> Live, from Las Vegas, it's theCUBE covering VMworld 2018, brought to you by VMware and it's eco-system partners. >> Hello everyone and welcome back to theCUBE's live coverage day three of three days of coverage, VMworld 2018 here in Las Vegas, CUBE wall-to-wall coverage, 94 interviews, two sets, our ninth year covering VMworld, I'm John Furrier with my co-host Stuart Miniman on this segment, our next guest is Milin Desai, who is the Vice President and general manager of Cloud Services at VMware, formerly driving the NSX business, been there for multiple years, eight years. Great to see you, thanks for coming on theCUBE. >> Pleasure to be here. >> So you've seen the evolution, you've been there, you've been in the boat. NSX, on a good path, doing really well, cloud services, very clear visibility on what strategy is. >> Mm-hmm. >> Private and public, hybrid multi-cloud, validated by the leader AWS and Andy Jassy, again for the second year. So pretty clear visibility at least on what the landscape looks like. >> Mm-hmm. Multiple clouds, software driving all the value. What's the cloud services piece that you're running now? Take a minute to explain what the landscape looks like, what's your charter, what are you trying to do, and what's happening with news and announcements? >> Sure, so about two years back we started on this journey around cloud services. And the premise was that, increasingly, there are two trends taking place which is; SaaS delivered experiences for on prem. So how can we deliver SaaS experiences on prem? As well as the partnership with, you know AWS for VMware cloud on AWS. So the two things started coming together both in terms of a product opportunity, which is VMware cloud AWS. But overall delivering our capabilities as SaaS, both hybrid as well as in the public clouds. So cloud services is a portfolio that delivers VMware services from management, to security, to operations, as SaaS services to the private cloud as well as to the public cloud. >> Tom Corn, the Senior Vice President of general security projects, was just on theCUBE today as well before you came on. He said, I asked him for a prediction and I'll ask you at the end too, for a 2019 prediction, but he said, "I see the conversation starting to be "security as a service someday," and he's kind of like connecting the dots a bit. But that proves the point it's a SAS business model. The services need to be consumable and scalable. This is a key design criteria and a product guiding principal right, for you guys? >> Yes, So increasingly SaaS makes it easy. The value benefits on that is I don't need to operate, it just works and I can get the value out of what we are delivering. And that's really what's driving the adoption of SaaS. It's easy to use, it gets you to outcomes quicker, and I don't need to worry about the management elements of that and so whether it's you take our updates to cloud management, we announced Cloud Assembly, Service Broker, and Code Stream, all delivered as SaaS to our hybrid infrastructure as well as if you want to deploy workloads in AWS or Azure, same thing. AppDefense, Tom's product, is delivered as a SaaS service. VMC on AWS is a managed SaaS service. So you're seeing that come together as VMware. The idea is can we bring that experience on prem as well as in the hybrid cloud? >> Yeah, Milin really interesting topic because often what gets lost when we're talking about multi cloud is what really matters, is applications and the data that sits on top of it. Maybe walk through a little bit, my on premises vs my SASified stuff vs the cloud native and PKS. How much of the business is driven from all of these pieces? >> So the majority of our business right now, is on premise software. Where customers are building and operating the infrastructure with our software. Now the first evolution into SAS was actually with our service providers, who are using the subscription model to deliver VMware as a service to their end customers. And then the second iteration of that is VMware cloud on AWS, which is growing really well. Both in terms of adoption as well of number of customers and now you are seeing the next evolution. So I would say from a numbers standpoint it's low, but in terms of number of customers adopting it, that number is high. So whether it's cloud operations with Wavefront or the whole automations suite that was launched, AppDefense. We are starting to see the shift to SAS but I would say the majority of our customers are on on prem software with VMware cloud foundation which includes NSX, and a visualized management portfolio which has been driving the majority of the revenue. >> I got to ask you about NSX relative to the cloud services because one of the things we've been pontificating and analyzing is how multi cloud is really going to work and we always try to compare and contrast to networking because Stu and I love networking and storage and some of the infrastructure stuff but if you go back into the evolution of TCPIP and what that did for the industry and Gelsinger likes to talk about this too, is NSX the kind of enabler that TCPIP was? TCP and then you had IP, created a lot of value, in inter-networking. What does the customer challenge look like when you're doing multi-cloud? It's not trivial it's hard to do. Is there a inter-operability framework, is it NSX? What could that be? >> Great question. I think as we go from private, to public, to the edge the virtual cloud network is what connects it all together and so definitely from within the data center with now the Velo Cloud acquisition the WAN, and then layering it with analytics and observability with visualized network insight, the portfolio of NSX allows you to connect these disparate data islands and operate very seamlessly, in this hybrid cloud world. Now the same construct applies, when you go native public cloud, where you can connect into AWS or an Azure and that's where, again the Velo Cloud acquisition alongside how NSX is extending its security policy, into AWS and Azure so that you can get the same security posture on prem, at the Edge, in VMC on AWS, with our VCP providers, as well as Native AWS and native Azure. So definitely NSX is that connective tissue, that's why we call it the Virtual Cloud Network, connects the Hybrid Cloud to the Multi Cloud. >> Seamlessly? >> Seamlessly. >> One of the feedbacks I get from users is, you know multi-cloud is challenging. There's that big elephant, how do I get my arms around all of the pieces where'll my data lives? Maybe give us an update there. I did have a chat with Joe Kinsella on theCUBE yesterday. So if CloudHealth Technologies fits into that overall cloud management piece, I'm sure it does, and you can give a little bit of guidance? I'd like to understand how that fits. >> Yes, you know we talked a lot about SAS and delivering VMware services as SAS to vSphere customers but there's this other world where people are going native AWS, native Azure, native GCP. The interesting thing I tell folks is it's very easy to consume cloud but as you start consuming it, you start dealing with tens of thousands of objects, across multiple projects, hundreds of projects across thousands of users. And when you start looking at the problem statements, same things, visibility, lack of visibility, resource management, you tend to over provision to in the cloud, right? By now you're paying by the drip so there's a definite impact to the bottom line. End to end observability and then configuration compliance. Think about this, you're operating at 10X in terms of changes, the chances of making a configuration mistake like leaving an S3 bucket open, are quite high. >> We've seen examples of that, too. >> Exactly, many a CIO have been fired because of that issue. So what we've been seeing with our customers is this has become a data problem, right? So the acquisition of CloudHealth allows us to essentially provide a platform that has that data, and then deliver to our customers in the native cloud, visibility, I say cost management so using reserved instances over on demand, resource management, hey your old provision on your elastic block storage we can reduce the storage capacity and save money. I can optimize RDS better. Sequel right sizing in Azure, so resource management becomes very interesting. Returns on a typical customer with CloudHealth are upwards of 60%. When you take that into consideration with real time security configuration, Secure State was just announced in beta, this week so real time security configuration. When that mistake happens with an S3 bucket being open? Sub 10 seconds we will notify the user that there is a mis-configuration in the cloud, please go fix it. >> Yeah, I'm curious, one of the other challenges is when I have, especially using lots of different SAS providers, public cloud, private cloud, data protection is a big challenge there. I know VMware has a lot of ecosystem partners, one of the hottest things over the couple years. Is that primarily an ecosystem play? How does VMware position there? >> Yeah so in the hybrid cloud world, like you said we have a very strong ecosystem, multiple vendors here exhibiting, there will be some default elements that we bring into vSAN to help kind of the basics of data, you know back up and management but we will definitely continue to partner with our ecosystem when it comes to an aggregate stack of data management but there will be pockets of just simple back up capabilities that you'll start seeing in vSAN, I think we announced the beta of that this week. >> Talk about your organization, do the general managers, do you have a profit loss responsibility so do you have revenue? >> Yes. >> Talk about the team, how you guys are set up. How big is the team? What's the focus? >> Our team, there's two elements to my team. One is my team drives cloud service across VMware so there are folks developing services themselves. The size of the team is now 70 strong across product, marketing and engineering. And then I also work with my counterparts like Mark Lohmeyer, AJ Singh who are building services on our common platform, right? And it's an aggregate to the customer, they come to cloud.vmware.com they federate their enterprise identity, they log in, they see our catalog. It's like a Netflix-like catalog. You can subscribe to it, you get a common experience in terms of billing and essentially start using the services. So it's not only what my team builds but an aggregate what VMware is building and offering to our end users. >> And what go to market do you have? Which products are you doing that go to market for? >> It's all of our SAS based cloud services. We collectively drive the go to market for that as a team working with our corporate marketing team. >> Awesome. >> Yep. >> So that would be a combination of VMware on AWS, AppDefense, now Secure State, Wavefront, and very soon CloudHealth. >> Yeah, a lot of pressure. (laughing) >> Do the SAS product share, do they live in like the AWS marketplace, IBM, you know DOC or what? Where can they get all of them? >> Today you go to cloud.vmare.com and subscribe to them. Certain offers are starting to get into AWS Marketplace, so CloudHealth is actually in the AWS marketplace. >> Sure, sure. >> And we are looking at Wavefront, which is a hidden jewel in our portfolio is also we are thinking about how can get it into the respective marketplaces of Azure, GCP, and others. But today if you want to access any of these services, you simply go and trial it by just going to our website and starting a trial. >> So they've given you all the new stuff, make it happen. AWS, VMware, AWS, vice versa. RDS on premises, you doing that as well? >> Yes. RDS on vSphere, since the announce we've had phenomenal conversations over here. >> Yeah, it's really exciting, I think people don't understand how big this is. >> John, I had a phenomenal conversation with Yanbing and Christos from the storage and availability business who just really broke down how all of that worked in detail. >> Yes. >> Yeah. >> The customer interest is high. Someone asked me, why RDS? And they said it's such a hard problem and that was my point exactly, there is such a pain when it comes to managing databases and just like everything else, we started off the conversation, customers want a managed service. They don't want to deal with the intricacies of managing databases, they just want the outcomes from how they access databases. Amazon has solved it very elegantly with RDS, it's one of their most popular services. Why not bring it on prem? So that's been a great engineering partnership we are driving with them, and I'm really excited to bring it to market, shortly. >> Well we're looking forward to keeping in touch, we wanted to actually follow up with you on that. It's a story we're going to be following, certainly developing, it's big news, we love it. Thanks for coming on and spending the time. I got to get you to put a prediction out there for 2019. What do you see happening in 2019 that we're going to be talking about next year at VMworld? Personal prediction, could be a VMware prediction. You've seen a lot of what's going on with NSX, you see what's going on in the big picture, wholistically what is the prediction for 2019? >> It might be a boring prediction, but I fundamentally believe this notion of hybrid being bi-directional in nature. I think you'll see more of that. Even Google announced GKE on vSphere, as an example. So I think you will see more of that come through and it won't be a one way destination conversation that we keep having. And you will see VMware truly be a multicloud company. It won't matter if you're deploying the application in the native cloud, or in a vSphere based cloud. We will help the customer where they land the application. My firm belief is next year when we are here, we'll be talking about stories about how we are helping scale customers in Azure and AWS and GCP on one end, and about how we brought cloud on prem with services like RDS. >> Final question, I'm going to put you on the spot. What do you think is the biggest disruptive enabler for the next 10 years in this bi-directional multi cloud world? Can you point to one this that says, that's going to be the disruptive enabler for the next 10 to 20 years? Is there something out there you can point to, trend, technology, the standard? >> So the way I think about the world is a little bit differently in terms of I truly believe that we are getting inundated by data. I'm not talking about the data that you store in terms of running your business but in terms of the metadata that you run your operations and your infrastructure with. And I believe that the layer that will control that portion, the metadata of infrastructure and applications, we have not even begun to understand where that goes and then you apply AI and ML techniques to that? The idea of, I'll throw a term around here, self driving data centers and self optimizing applications I get really excited but it all begins with that data layer. And we are starting to put the beginning signs with CloudHealth, our private cloud assets to start that process. I'm really excited about how AI/ML meets that data layer to achieve those outcomes. >> It automates IT operations, sounds like automation's coming. Milin, thanks for coming on. Milin Desai, he's the vice president general manager of VMware's cloud services. The hottest area, it's emerging, it's got a lot of attention. We'll be following it, of course, on siliconANGLE and Wikibon and theCUBE. We're day three coverage here in the broadcast booth in Las Vegas in the VM village. I'm John Furrier, Stu Miniman, stay with us for more after this short break. (upbeat techno music)