>> Announcer: Live from San Francisco, celebrating 10 years of high tech coverage, it's theCUBE! Covering VMworld 2019. Brought to you by VMware and its ecosystem partners. >> Okay, welcome back everyone live CUBE coverage here in San Francisco at VMworld 2019 I'm Jon Furrier, my co-host this segment, Stu Miniman. 10 years Stu it's been a long run. A lot of CUBE alumnis around, we got two here. Honore LaBourdette Vice President go-to-market Telco Edge Cloud at VMware. And Lakshmi Mandyam, Vice President Product Manager, go-to-market Edge IoT at VMware. Great to see you, thanks for coming back. >> Thank you for having us. >> So, I think IoT's going to be a pretty big deal. 5G, jury's still out on 5G but it's looking good. Look, if Pat Gelsinger said it's going to be great, it's probably going to be great. What's new? Give us the update. >> Well, just a commentary on 5G, when you say you think it's going to be great, there is some skepticism in the marketplace because if you go back and look at all the different generations of cellular technologies, it's the odd numbers that have never been successful and the even numbers that have, from a monetary perspective for the telcos. Interesting thing about 5G is because it's such a system-oriented technology, that we do believe that it's going to enable a lot of the capabilities associated with IoT, right? So there's an interdependency between 5G and IoT and IoT and 5G that I think is going to make 5G more successful than any of its predecessors. >> All of us are nerds that geek out on RF and physics. I mean 5G has a lot of skeptics but they're deploying 5G, it's not like it's a vaporware. There are deployments going on in the United States, certainly outside of the United States. So it is real, it's actually happening. The question is what will be the impact to the network effect and what's it going to enable, which will certainly impact the industrial IoT and IoT markets. >> Well so one of the things that's happening with the deployments of 5G isn't just the innovation associated with the spectrum technology of five generations of mobile technology, right? There is an entire transformation happening with the core infrastructure of the telco network. And there's an interdependency there as well, right? So as the telco's software define the infrastructure on which they run all of their services, that then extends all the way through from the cloud to the core to the edge for all of the radio access and everything associated with 5G. >> And we're also seeing on the IoT side that there's a similar transformation going on, 'cause right now when you look at kind of example manufacturing, right? There's a real siloed infrastructure, siloed use cases and people are not able to scale and especially when you start to see the business impact that IoT's actually going to have, because most of the data that's being generated is actually being generated from the devices at the edge. And there's a viewpoint that a lot of the workloads that are actually being generated for the enterprise are actually going to be executed at the edge and when you take those things into consideration, it's really important to have an infrastructure that scales. And just like we've seen in other areas where a sprawl of infrastructure is really not going to be be effective in terms of delivering business value. That's the same problem that we see here. >> That brings up a good point. You mention systems view. I think this is interesting 'cause I think this business model innovation, as well as the architecture. I mean, you become what you're known for in the old infrastructure. You don't want that legacy to be dictating the new things, you mentioned backhaul. That's a topic that people talk about in the cellular business. You got the radios, you backhaul through a network, go to the core. But now you're getting at something different where if you're going to be backhauling, which implies moving packets around, moving data has become a really big problem or concern because the cost to move data, the physics involved, latency is a requirement. Processing at the edge becomes the new architecture. >> Yeah, I think the old paradigm was around moving data to the compute but the new paradigm is going to be moving compute to the data, especially on the edge and the IoT. And this is where managing that whole compute infrastructure is going to be really, really important. And that's what, you know, the VMware Telco Edge-- >> Well, we're going to ask Pat Gelsinger a question that riffs off what Dave asked years ago. Stu, I don't remember what year it was, 2012 or 2013, Dave Vellante asked Pat Gelsinger, "Is security a do-over?" You know Pat's very opinionated, he's like, "Absolutely a do-over." Really risky, bold take to say at that time, turns out he was right. The question I want to preview with you guys is, is the architecture a do-over? Because if you think about it, there's new capabilities, you mentioned the systems view. Is there an opportunity, not to throw it away, but like, just rethink it, get a second chance at deploying large scale edge, cloud, versus backhauling through the data center, maybe backhaul through the cloud. So, to me it's just kind of feels like a do-over. >> Well, there's very much an opportunity to, I'll say evolve rather than to do it over, right? 'Cause do-over kind of implies everybody's going to throw out everything that they have. But when you think about the beauty of software is that now we can have inherent security in all of the aspects of the software defined network all the way through the edge. So if you happened to hear Pat's keynote this morning, you know, he put up a slide of all the different security vendors across all of the different types of, the different areas of the clouds, the different cloud technologies and basically said that there is an opportunity now for us to do for security basically what we did for compute and networking and storage, by software defining that. And so that's the opportunity for security is to leverage all of what you can do with a software defined approach and have security be intrinsic to everything from the cloud to the core to the edge. And specifically for IoT. If you think about Lakshmi's comment about pushing the compute to the apps, and pushing the compute where the applications are going to be, or the user is going to be, I think there's going to be a greater requirement for security actually at the edge than even what we see in the cloud today. >> Lakshmi, you know, one of the comments we made is if you looked at the keynote this morning, the virtual machine is not the center of the the discussion. There's, you know, VMware, now plays a lot of places where that VM is not at the center. If you can bring us up to speed, when VMware looks at the edge architectures and how they're going to work with enterprises there, you know, what are the solutions that you're going to bring to bare out of the portfolio? >> Yeah so we have a, you know, when you think about IoT and there's all these things that are out there, oftentimes when someone installed it in the factory they didn't even update the factory settings, the threat surface of that is just expansive. And so, what we're doing with the product that I'm going to talk about, Pulse, we actually life cycle manage these devices, software updating, making sure that they're compliant with IT kind of security and other requirements. And so, what we see is the architecture, is we see kind of this managed infrastructure at the device level, that then feeds into kind of the thin edge, and you heard Pat talk about it this morning, right? Pulse and NSX and VeloCloud for the thin edge and that kind of, it's a continuum really. You can't define-- >> It's difficult to do. >> It's a continuum of compute ranging from very small footprint all the way up to our Dell EMC announcement. BMC on Dell EMC, sorry. >> We actually did some original research back when, you know, GE was putting together their industrial internet and one of the biggest stumbling blocks we saw is that huge gap between the IT and OT, they don't talk. You talk about the telco, that telco role doesn't tie in to the traditional data center world. It's at the edge and some expert comes in and does their piece but, you know, smashing these worlds together is a real challenge. >> What's interest-- >> Oh, I'm sorry. >> I was going to say 5G is the technology that I think is going to create the catalyst for those technologies to come together, right? So you have the enterprise edge, you have the industrial edge, and you have the telco edge. And over time, the more the telcos start pushing compute out to their edge, enterprise push compute out to their edge. And then you have all of these industrial IoT devices. The definition of the edge is going to begin to blur. >> I think this is, I think the IoT, industrial IoT, is probably the most important tech story this generation. It doesn't get as much play as AI, 'cause AI kind of sounds cooler, attracts young kids to be coders, but IoT is really the most important thing because think about the industrial IoT, the threats, cyber threats, cyber security. One hole, one hole and the attacker is in. Just to speak security and critical. >> I actually think it's beyond that because I don't know if you heard Pat talk about his definition of the edge, which is actually that merging of the digital and physical worlds. When you think about that, most of human problems can be solved by great technology, technology for good. And so you think about industries being pushed to produce more, 70% more food with just 5% extra land, or you know, carbon emissions, all of these problems which with good visibility control and management can be solved and that's really what we're trying to do-- >> Yeah, but good intentions, I understand where Pat's coming from. It's good, it's good marketing on the stage but the reality is, is when you roll out the tech to make that happen, if you don't have that security intrinsically pulled in, this means that you got to have the zero trust. But IoT is a different animal on a thin edge, than it is, say a data center. So like, it's just one of those things where we're watching 'cause it's just, there's so many, the service area is so large. >> Yeah, and in fact, one of the things that we're doing in terms of incorporating security in the management is looking at hardware Root of Trust right down to every device that's managed and being able to, you know, to attest whether something is legitimate or not. So we're rolling all of those things into our technologies. >> So, Pat brought up the telco. Earlier on, we were asking some of our guests about the business model on telco, because, you know, telcos have been struggling, they had owned infrastructure. So when you own infrastructure, it's hard to go out of business unless you actually run out of cash, but they had plenty of working capital, but they got to get their business model. You guys have any thoughts on as telco starts to modernize, whether they migrate and modernize or modernize and migrate with cloud, what's hopeful things that you can share that's showing business models for telco? Because 5G, someone's got to pay for it. It's not inexpensive to roll out 5G. >> So, what we're seeing with our telco customers is that they're finally beginning to realize that they can actually accelerate their time of revenue with new services, with a software defined infrastructure. So, I think when first we met, you know, we were in the early stages of developing the market for telco with software defined. But we've crossed the chasm now to where we have over a hundred discreet telcos that are in production on our platform. And so we have proof points that says, "Okay, now they can accelerate time to new revenue". What we're focused on now is helping them extend that out to the edge. And as you know, partners with Lakshmi, we see the telcos as a route to the enterprise market for our edge an IoT solutions. Right, so there's an opportunity for telcos to participate not just in the cloud economy but the edge economy. In terms of the business models, the change is driving the business model transformation. You know, the technology is driving business model transformation. But it's an excellent point. Its operating models are transforming, business models are transforming, and interestingly enough, commercial models are transforming as well. >> Lakshmi, you know the app side's going to be where the growth is now. Getting back to the good thing, once that infrastructure is stable, the apps can come out. So the application development, the microservices, that kind of to me connects that Kubernetes piece to it. That is an opportunity to telco providers, right? >> Yeah, absolutely. I mean again, it's all about deploying and managing applications right at the edge and so the infrastructure that we're building, with all of the announcements that you heard and the features that we're adding into the product profile is really about how do you deploy and manage these applications right down at the device level and that's really where I think it's going to transform. >> A lot of action. >> A study came out just yesterday that the edge market is targeted to be a $4.1 trillion market. >> Yeah, it's going to be huge. >> That's trillion with a T. >> Yeah, it's going to be huge. >> So, wondering what you can say about the ecosystem. Because, you know we've looked, VMware has always had ecosystems but it's many ecosystems, and you've got a cloud marketplace, and there's lots of different customers so will some of your existing partners go along with this, is it building out a new suite, you know, when you look at the edge and IoT? >> I think there will be a group of partners that come along, for sure, but, you know, IoT, especially when you think about industrial IoT, it is a new space of players and we're building that ecosystem and trying to figure out what customers want, right? Because, it's an ocean, you could boil it but that may not be the right approach. >> Yeah, I mean, it's like you said, there's a T on the TAM. It's a huge, huge TAM. It's going to be a huge application boom and IT culture's got to evolve from that perimeter-based security to a surface area that's out there, that's one light bulb on a factory, that IP enabled, could be a malware entry point. It could be something for a worm to get in there. >> Well, it's really like any device. What's that, any-- >> Any device, any application, any device, any Cloud. >> Any cloud, I think in IoT, it's anywhere. >> Anywhere, exactly. >> Totally, totally. >> And to your very accurate point about the security associated with that, right? In the telcos, actually owning that last mile. Right, so when we talk about $4.1 trillion of opportunity, and the need to develop an ecosystem that can support those edge and IoT solutions, the telcos really are in the cat seat to take advantage of that because they own that last mile of customer access, customer influence, they own the cell towers. Right, so as we push compute out to the radio access, telcos have an opportunity to participate. >> Honore, I want to get your thoughts while you're here and Lakshmi, if you can chime in, that's cool too. I'm doing a big editorial on industrial IoT national security. This all kind of leads into policy, potential regulation. You know, I mentioned tech for good, tech for bad is neutral how it's shaped. I'm assuming you guys are going to take a shape in some of those conversations. Any thoughts on regulatory things happening because with cyber security, cyber war that's happening on our digital turf, the telcos are in a prime position to assist and help shape that, you guys can do that. Any thoughts on how you see that, that conversation? Anything you'd like to add? >> So VMware is participating in consortiums associate with those very topics. And of course we are developing technology with an appreciation and understanding respect for the governing agencies across every country as it relates to privacy and security. And so I'm sure, you know and it varies from country to country. In terms of what data you have access to and how you deliver that data and what you do with that data, that's a really hot topic in Washington these days, right? >> And software helps too. >> Software does help, right? You have so much flexibility with software but at the same time you have so much risk that you have to prevent. What we've learned is, it's really about the individual's information. Whether that is a device or an industrial device or an end user or a potentially, a point of presence. It really does depend on what you do with that data, who touches the data, and where is that data going to be housed. And so each of the different countries, each of the different telcos, depending on their location are adhering to the governmental requirements for who does what with the data. >> Yeah, it's interesting, we just did a power panel in our studio, we had experts come in talking about called the "Cybergeddon" scenario, which is a hacker taking over not just malware and getting penetrated with worms and getting access to data, but actually taking over physical devices to harm people. So, this is kind of a nation threat thing. It's not so much a corporate thing, but you know, there is a shaping opportunity here when we're trying to identify where, you know, good governance, at least from a policy stand point, tech are coming together. More and more, it's happening. >> And of course, we participate very actively here in the U.S., right? Because we are a U.S. headquartered company. We try to participate where we can in some of the other countries for the regulatory agencies. And we're a part of the world economic forum. So through that vehicle, you know, through that consortium we're also trying to influence, for good, of course. We just recently, we announced this morning that we acquired Uhana and Uhana is an artificial intelligence machine learning and specific to telco, it will observe, analyze and report back on data all the way to the consumer level across a radio access network. And the one question we get asked from every telco that we do business with is, "What do you do with the data?" And of course, we don't do anything with the data. In that particular technology, we're observing it but we don't necessarily touch it. But you're exactly right, I think it's something that's going to be a hot topic for a time, awhile to come. >> It's an opportunity for tech for good. Guys, thanks for coming on, sharing your insights. Great to see you again, thanks for coming on. Great insights, a lot changing and certainly very relevant, the IoT Edge, telco, IoT's all happening, AI is a part of it. It's theCUBE, live coverage. I'm John Furrier with Stu Miniman. Be right back after this short break. (light techno music)