>> From Las Vegas, it's theCUBE. Covering Open Systems, the future is crystal clear with security and SD-WAN. Brought to you by Open Systems >> Hello everyone, welcome to theCUBE, We're here in Las Vegas again for another awesome set of conversations. CUBE coverage here at the Cosmopolitan hotel at the Chandelier Bar. We're here covering Open Systems having a special event in conjunction with a lot of the conference going on, Gardner has a big symposium, lot of things happening, we're here with M.K. Palmore whose the head of the FBI'S cyber security, San Francisco branch of the FBI, great to have you thanks for spending time. >> Thanks for having me, John. Much appreciated >> Chandelier Bar, everyone's having a good time, you guys had a lot of sessions today, conversations. You gave a speech today during a session around info sec and culture. >> Info sec risk and leadership. >> Okay talk about that, what will you, what was your main theme. >> Yeah, so I've over the past five years or so had the opportunity to go out and speak a lot about the cyber threat landscape. Going into this year, because the message is getting a little stayed and old, I think I want to concentrate on those issues that I think can help move the ball down the field a little bit. So, talking about cyber security risks as an enterprise risk, discussing it as a matter of an enterprises responsibility to address cyber securities as an enterprise risk is an important message to carry, and I like to add in topics and subjects about leadership, and tie all of those in because in my view, information security professionals have to be leaders as well, because we're all venturing into space that's not known to us. >> That's a great point, leadership also has to take into the new environment, your dealing with you know, a decentralized threat landscape, distributed, decentralized. >> Global. >> Back in the old days when I was in college, you get a pager, you get a new one, now you get flip phones and you can swap em out, now you're everywhere, you got social media, the ability to dodge the authorities, is easier, almost easier than ever before, requires you guys to be on your toes, to catch the bad guys, you need cutting edge technology, but you got to have a mindset in a management culture of leadership, to empower people at the edges. How are you guys thinking about, cause this is like one of the main cyber topics is, setting that system up to be nimble, reactive, used data, >> Right. >> What's your thoughts? >> Yeah so I mean, frankly the FBI is learning in new ways to approach this cyber security problem. We understand that we have to hire the right people with the right talent and that we as an organization we're used, frankly we're used to fighting you know, bad guys in the streets, are now taking this fight to the networked environment and we have to come up with new ways of tackling the problem. One of the biggest problems that we face and you touched on it, is that near 100% anonymity that criminals enjoy operating in the network environment, that ability to conduct transactions, that ability to essentially go unnoticed for long periods of time, without anyone knowing your true identity, creates a huge obstacle for law enforcement, but the good thing is that frankly it's something that we're very good at in terms of identifying whose on the other end of the keyboard, but it takes a lot of work. >> You know I'm old enough to have some friends that have graduated from you know, criminal justice majors when I was in college, I was a CS major, they went DEA, FBI, so a lot of friends and it's evolved a lot from having that branch office >> Yes. >> Focus, you now have digital, and one comment that always kind of resonated from my friends that were in the law enforcement area goes, John it's like putting the puzzle together, and you got to get the puzzle pieces to put it all together >> Right. >> Now you have a sea of puzzle pieces, it's almost like a three dimensional puzzle, because you have to get the data, you got to understand the landscape now and multiple dimensions >> Right. >> That you just mentioned. How do you guys keep up with putting that puzzle together, before it changes? >> We get a lot of help, right, so what we're used to doing is using the FBI'S special agent as the main tool of our investigations, in the cyber world we've had to add some pieces to that, not only is there specific training now for cyber agents, those agents that are charged with investigating intrusions, we have computer scientists, we have data analysts, we have folks that we bring to bear, in any one particular investigation, who add talents and tools that every, you know it's like, everyone is at the table on these investigations bringing different aspects of the investigation together and it is like you said, multiple data points and as any investigation is, lots of pieces being brought together to tell a story that we ultimately have to, you know convince the judge of, in terms of judge and a jury sometimes, of the validity of what it is that we've found. >> So timing is very important as well. >> Timing's huge, as we like to say, we want to be involved in intrusion matters as quickly, and as often as we can. Part of the challenge that we face is that there's a little bit of tug and pull between us and the private sector, and we aren't always brought in as early in a breach investigation as we would like to be, and those, it's valuable, valuable minutes, valuable days that are lost sometimes in that, in that transactional process. >> I interviewed Christine Halverson, I don't even, I'm sorry I didn't interview her, I watched her give a presentation amazon reinvent last week, she gave a key, one of the key notes during a public sector summit, Teresa Carlson's breakfast that she had, and she said something very fascinating she said, we are in a data crisis at the FBI, meaning that they have to put the puzzle pieces together and get it done quick, it was something along those lines, but she said that the FBI has been very progressive in adopting new technology, you guys are moving very very fast and she said she's excited by that but she said we need the data, whether that's being called in quickly, >> Right. >> And or getting access to other data bases, right, so it's like the data is out there, so you guys need access to that, how do you guys, how do you, how's the FBI evolving with that, architectural cloud and what not, and how are you enabling the tools for the field agents, and the people in the trenches? >> So the data analytics is an interesting area to dive deeply into, I mean we face the same challenges as any private organization, in terms of how we intake the data, how the data's organized, how it is that we then retrieve the data, look at it, how it relates to the different data points relate to one another, we face all of those same challenges and we have the added challenge, I think in the environment that we're in, in terms of how we're able to adopt private sector products that are out there that might meet our needs, I mean I've been in government now for over 30 years, it's a bit of a challenge being able to acquire the types of platforms and products that you, that you would want to have as quickly as you would like to have them, but eventually we do get down those roads, we do adopt platforms that are useful to us, and again like everyone else, we're trying to move as quickly as we possibly can in this environment to keep up with the bad guys. >> And you guys do a great job moving those antiquated inadequate systems to more real time, >> We try. >> State of the art. >> We try. >> So I interviewed General Keith Alexander once, and we talked about identity and private sector, public sector collaboration. Can you share your thoughts on that, because this is something that's become a bigger trend recently in the past five to 10 years, past three years in particular where it's a sharing culture it's not just, well I'm not going to call the FBI they're going to come in, it's no no we're going to bring them in early, whether it's a breach you think, or someone hiding, I mean the Marriot thing they didn't even know they were there! So, you guys are now spending more time collaborating with the enterprises and businesses, how has that changed your approach, your posture, how you look at the data, can you give some insight into that? >> Yeah so I mean a lot of it's about relationship building, I will tell you that, in the San Francisco division one of the priorities we have within our cyber branch, is to ensure that we have a certain level of rapport, not just with the big tech giants in the valley, but also with the medium size enterprises and the small enterprises, we spend a fair amount of time putting ourselves in front of the C-Suites, boards of directors and talking to them about one, what capabilities the FBI brings to the table, we open the lines of communication with them and we build a rapport, in such a way that it allows them the trust to then bring problems to us and we then begin an exchange of information. The point you made about, public, private collaboration, it's an absolute must, there's no way we get through this tough period that we're in, without both sides sitting down at the table, establishing some trust, and then moving together to solve these problems. >> The other thing I'd observe and you may or may not want to comment on this, love to see if you would comment, but the notion of agility, especially with data and systems and cloud computing. CIA, the Department of Defense, are moving to systems that can be as reactive and accurate as possible, and this is a changing of relationship to the suppliers! >> Right. >> You know, and the government, oh multiple suppliers, we got to do five different things, >> Right. >> But if the systems don't talk to each other, you guys can't be fast. This is seat change and the mindset. >> The whole government I think is beginning to understand that in this world, technology, we need to be much more agile in terms of our adoption of new products that will allow us to combat crime, and frankly the threat from the national security sector that we're responsible for responding to. So we understand that there's a certain level of agility historically not present, that we need to move the marker to get towards. >> Let me ask you a question, does the FBI have an app store? (John laughs) >> So what, we have secured telephones that we utilize and we certainly have an approved list of apps that we're allowed to have on our phones, so we do. The short answer to that is yes, it's a very truncated list of apps that we have available to us, but they're helpful. >> Well we were joking. Well we were joking at reinvent and all these cloud conferences because, the developer now, building a right new software apps is faster, so this whole dev ops ethos of cloud computing >> Secure DevOps yeah. >> And so secure DevOps is really interesting because now you don't have to, you can free up the data in the infrastructure and yes infrastructure is code, your going to see a renaissance of new applications, so the joke was, you know you made it when you have an app store inside the FBI, there's an app for that. Okay, final question for you, as you guys do your thing and I know you get called in a lot to mentor and also collaborate with enterprises, what's your advice on the info sec landscape? Do you talk to CSO's and CXO's, CSO's in particular are under a lot of pressure, >> Right. >> Board level kind of responsibility, not part of IT anymore they are now a critical piece of building out these teams, what's your advice to them in terms of either, whether there's observation's our best practice that you've seen, that they can think about? >> So a couple of the points that I typically hit on in my talks, that I hit on today, one is this idea of looking at cyber security as an enterprise risk which you just talked about. We need to get away from the old school thought process of cyber being an IT function, right? It's an enterprise risk, it needs to be talked about in terms of risk, the language of risk management, with the C-Suite, with the boards of directors, because when you talk in a language of the likelihood of an event happening, the impact to the organization and what that means in terms of, daily revenue, daily dollars to the business, that's a language that business owners and business leaders understand. So the oweness is on information security leaders to adopt this language, so that we can communicate our needs to our colleagues in the C-Suite and the boards of directors. It's a seat change for information security professionals because this is not a language that they are typically used to speaking. >> And they got to level up there too because this is the reality. >> Absolutely. >> Alright, final final question, what's the most exciting thing that you're working on and or you're seeing happening around you, that you get up in the morning and say, man I'm so excited to work on that. Or trend or technology. >> I'll tell you when you work for an organization like the FBI, which I've done for almost 22 years, at the end of the day it's getting exposure to people who are engaged in trying to achieve the FBI's mission on a day to day basis and at the end of the day, I don't care how much technology you have around you, I don't care how much policy you have in place, having the right people in place who are dedicated to what we're trying to accomplish, that's the thing I get the most juice out of on a day to day basis, we get to actually, in this portion of my career, really work with some of the most talented people that the FBI has. >> And their being empowered more than ever right now in this technology >> Absolutely. >> M.K. Palmore thanks for coming on theCUBE appreciate it. Head of the FBI cyber security in San Francisco. It's theCUBE here in Las Vegas at the Chandelier Bar in the Cosmopolitan, breaking it down. Part of Open Systems private event, they just had a lot of stuff going on with Gardner, lot of events happening here in Vegas, I'm John Furrier, thanks for watching. (modern music)

(upbeat music) >> Hey, welcome back everybody. Jeff Frick here with the CUBE's 2018, a new year. I think this is actually my first interview of the year. I'm pretty excited. I have a CUBE conversation here in the Palo Alto studios to talk about a pretty interesting topic. It's been growing over time but it's getting more and more sophisticated and a much bigger reach. And that's dynamic pricing. It's not just stick the sticker on the item like it used to be back in the day. And that's the price and it's much more complicated. Much more sophisticated. And we're excited to have Alex Shartsis. He's the CEO of Perfect Price. Alex, good to see ya. >> Thanks for having me. >> So, dynamic pricing, right. We've saw it. I guess probably the airlines are maybe the first ones to do it. Or you know, Priceline.com was kind of the first one to talk about. You know, hotels have rooms they can't get rid of. But it's moved a lot further down the path than that. I mean now the Giants I think have have flex pricing. Whether it's the Dodgers on a Friday night or it's Toronto on a Tuesday. >> Yeah, I think it's kind of just a really interesting subject, cause everybody's experienced it, right? I mean, you may not know you've experienced it. But everybody. Whether you've taken an Uber, taken a flight, stayed in a hotel. Even at this point going to an A's game or a Giants game. You've been dynamically priced. And I think what people don't realize is a lot of times they benefit from it. You're able to get that flight for a little bit less. You're able to get the Uber for a little bit less, especially than a taxi. And yeah sometimes there's surge pricing. There's last minute fares. There's things that are more expensive but it's something that every consumer has dealt with. And I think a lot of us think about pricing from a consumer standpoint cause we're all consumers. But from a business standpoint there's nothing more impactful than dynamic pricing. >> Yea, and pricing in and of itself is such a complicated issue. You go through some of the stuff on your website. You know are you coming at it from a cost point of view? Is it a cost plus kind of a model? Or is it a value model? So there's a lot of factors, right? There is no kind of perfect price. You don't want a price at the top of the market. You know, then you're giving up some volume. So what are some of the factors when you talk to people as the pricing evolution is happening from kind of what they used to do to what they're trying to do now with dynamic pricing and how you can help them? >> Yeah, so I think if you think about sort of pricing evolving from. Cost plus was kind of the beginning. Like I bought the potato from the farmer for five bucks a pound. And I'm going to sell it for 10 bucks a pound. That covers my cost of shipping it. Having a stall at the Bazaar, whatever. I think, you know today, a lot of companies still do that. Which still shocks me. But there's you know, there became this sort of in the middle of the last century. Which is kind of weird to say. Value based pricing became a thing. So it wasn't that I would sell them for 10 bucks a pound cause it was just double what I paid for them. It's people are willing to pay 10 bucks a pound and then if I try and sell them for 12 nobody buys them. Or a lot fewer people buy them and if I sell them for seven I run out. And I could have made a lot more money. So what value based pricing was is really like what is my customer willing to pay? And the Bazaar was a great place. You have a conversation. You know, Alex, how much do you really need this potato? How much do you really want this thing? Oh, you're like wearing a nice suit. I think I'm going to charge you more for this. And that obviously went away when the department store was invented. And people would walk around and see a tag on the item. And so what we do and I think what our customers are really benefiting from is this notion of really accurately figuring out what that. Not only the value the customer's getting but also factoring in all the other business related costs and fixed costs and things like that. That should or should not be part of that equation. So that the company can sometimes sell maybe at a loss on that one unit. But you know, in the case of a travel business like an airline or hotel. Loss is a very subjective thing. And you're able to make money by lowering the price for a certain segment. Or for a certain time or for a certain origin, destination. Whatever that combination is. And increase your overall profitability by doing so. Plus bring in some customers that wouldn't have been able to buy from you before. >> So, that's an interesting point of view right. Cause always what are you optimizing for? Are you optimizing for the single transaction? Or are you optimizing for the bucket of transactions? And then that can get you to very different places. So as you seen it kind of evolve what are some of the key factors that tell one of your customers you've got a great opportunity to increase profitability. Increase revenue, increase client satisfaction. Again, what are you measuring? What are you optimizing for by incorporating a dynamic pricing and how did it get started? >> Right, those are great questions. So we went into this thinking there are a lot of businesses that are stuck in cost plus pricing. And they would benefit the most from dynamic pricing. Or from using AI to price things because they're doing such a bad job of it today. And it turns out they liked doing a bad job of it for whatever reason. And we have now been successful at convincing them that maybe there's a better way to do it. But the companies that already have a lot of people and a lot invested in pricing in some fashion. Some companies call it revenue management. Those companies are the ones that really benefit and the reason is they've already seen an impact. So one of the key things for us as you. One of the first questions we ask people is why are we talking about pricing? Did you do something? Did something change in your business? Did you notice it had an impact? And everyone of our customers has been able to say yes to that. Somebody made a mistake and they changed the price and they saw a huge swing in their business. And they realize maybe we should think about it this time. >> It's usually some kind of mistake that undercuts. >> Not usually but more than once it has happened. And sometimes it's like we should do software here or not. And not let people fat finger things in. But for the more sophisticated companies. They've already seen. Some of the companies we've worked with have had pricing teams since the 70's. And so they are constantly improving and they see using AI to do dynamic pricing is the next evolution. And they don't want to get left behind. They know know it's a core of their business. And just as Enterprise Software is moving to the Cloud. Machine learning people are starting to use or have been using the graphics core for a while. You can't ignore that trend if it's a core to their business. >> So that's interesting so and we didn't really kind of talk about the impact of AI. And just really AI. Or intelligence to do a better job of optimization because as you said if you've already invested in pricing it's a complicated thing. There's so many factors and another thing about. Kind of Amazon and the Amazon pricing strategy. Or the vendors within Amazon even. And then how do you factor in convenience? How do you factor in prime? I mean there's these other things that have absolutely nothing to do with the physical price that can enable you. You know as you said, get more revenue. Get more profitability in these factors. So now we have AI. We have these crazy big machines. We have Cloud computing and big data. Huge disrupter to this marketplace and then really new opportunities to bring a lot more power to bare I would imagine. >> So I think Amazon is a great example. Cause people have really experienced dynamic pricing with Amazon. Just cause you put something in your cart the next day it changes by five cents. And Amazon's January pricing is really interesting because Bezos is being very vocal about being consumer centric. And so they're looking at what the market is doing and what things are priced elsewhere. And they're always trying to be competitive and give you value because they recognize. You said earlier. What are you trying to optimize for? Is it revenue, is is profit? There are other things you can optimize for that actually improve both of those numbers. Like how frequently you come back to that as a customer. Do I go to Amazon or do I look at Target or Walmart first. That is a huge impact in Amazon's profitability. And you may do that because of price that one time or over your experience with Amazon as a retailer. So I think what's interesting about AI is that it enables us to go. Just like the ad industry did. Went from having a lot of humans. Trying to solve a problem that really wasn't solvable by humans. So taking a lot of shortcuts. Doing what they could. It actually solves a problem. So if you think about the ad industry. If you're spending 10 million dollars on ads which I'm sure some of your listeners would be. And you're running a campaign. You probably have an agency. They probably have 10 people managing your campaign. They're looking at the 30 or 40 creatives. They have a 1,000 publishers it's running on. But pretty soon the numbers get big. I'm not going to do it right now on camera. But you multiply it out. You're talking about billions. >> And they're all multi varied right. So there's all the different. >> Right, well is the purple creative doing well on the female focus websites for 20 to 30. But not for 40 to 50 and at some point you can't keep track of all the permutation. And one of the weird twists I learned working in that industry is that. When you get down to people who actually click and convert. That's a very small number. So you might have millions or tens of millions of impressions. But you might only have a thousand or two thousand customers that ended up out of it. So you're trying to back out. Okay, that was a customer. Where did they start? And that becomes a very, very thin line to draw. And 10 years ago that was all people. You know, you had your agency. You had literally thousands of people that we traffic those campaigns. And today 78% of those ads are served by AI. Those decisions aren't made by humans anymore. And I think if you think about dynamic pricing for businesses that are very large and have really complex businesses. Like rental car companies, hotels, airlines. Transportation trucking where you're dealing with thousands of different factors. Why would you trust that to people if you don't have to? >> Yeah, as long as you have the data right. And the sophistication gets pretty interesting. You guys have a better appeal to people that already understand the value of dynamic pricing. Which you're really offering them is a new way to do it. An AI based way to do it. A Cloud based way to do it. >> The one place where we found a lot of interest that haven't had sophisticated solutions in the past. The companies that don't have a lot of direct competition. Cause a lot of, at least in travel, a huge part of the revenue manager function is what are the Jones' doing? Right, find the Hilton. What's the Marriot around the corner selling their rooms for? And for better or for worse I think there's a place for it. But it don't think it's quite the same place it's just easy for a human to go to your boss and say well boss. The Marriot around the corner is at 250 a night so we're at 260 cause I think our rooms are nicer. And yet in your data is actually the optimal price. If you look at your data. You can actually get to that price. Maybe you set some rules or you put some limits on the AI. So if the Marriot is at 300 you're not at a 1,000. Maybe you should be, right. You should maybe think about that a little bit if that's what the AI is thinking. But if you don't have that crutch. If you don't have a direct competitor around the corner from you. Then it becomes really hard. And that's why Uber started doing this in the first place. Because they knew taxi pricing was wrong. But to Travis and Ryan and the people who started Uber. The key part of it. The value proposition was always being able to get a car. And so the only way you could do that is basically by pressing people out of the market when you don't have enough cars. And then that one person who really needs to go to the hospital. Or is in DC and needs to go to a New Year's party. Whatever it is. They can pay the $200 to get to that thing they really need to cause there still is a car as opposed to not having a car. >> So you bring up a whole other kind of layer of complexity and that's the third party provider. And it just fascinates me that everyday it seems like there's a new Trivago or Kayak. Or God knows how many other kind of secondary marketplaces there are. So how does that factor in when you not only are worrying about your own pricing? Vis-a-vis your competition around the street or kind of your classic set of competitors. But now you've got this whole other layer of distribution that's kind of outside of your direct control with a whole different type of a pricing structure I would imagine. In terms of supporting. Are you seeing that expand to other places or is travel such a unique thing because of the perishability of the assets? >> So I think it will expand to other places. We think transportation in general, also trucking. I mean everything that has these sort of high operating leverage models. Where you have a lot of vehicles or distribution centers or things. The more accurately you fit your pricing to your demand the more money you'll make. The better run your business will be. The more time you save. It has a lot of implications. One of the things that's really interesting about the different channels is traditionally they have played a roll. You know you think about Nordstrom Rack or TJ Max or Priceline. Hotwire, right. You as the Hilton don't want to ruin your brand by renting your rooms for 50 bucks a night even though you know they're going to be empty. So you give them to Hotwire or you give them to Priceline. That always going to play a roll. A lot of these other places are drawing from the same inventory. So it's just yet another front door for you as a hotel or airline or a rental car company to get business from. What's interesting is because of software. Because of legal agreements and also because of software. There isn't a lot of variation in price. Even though every travel site says cheapest prices or best price guaranteed or whatever. They're all getting their pricing data from the same place. It is the same price. And so it's sort of. Unless it is run in inventory. Unless it is Hotwire where it's opaque. Where you don't know what you're getting. If you're getting a room at a Hilton. You could pretty positive that where ever you book that room Hilton's going to be the same price. >> So it's just pure marketing when they're trying to compete. Because ultimately the system kicks out what that third party available price is or is that even dynamically? >> Well, if you think about. I worked in the travel industry for a while so I don't want to share things that I shouldn't share but if you just think about. If you were the company that powered all these different sites. And had your own big consumer facing website. Would you be okay if Hilton rented its rooms for 50 or a 100 bucks less on its website? Then it lets you rent them for it. >> Probably not. >> Alex: Probably not. (laughing) >> So before we run out of time. So what are the key kind of attributes to the business that really lend itself to having an opportunity to increase profitability and revenue with dynamic pricing? >> So the biggest one is that you've seen. You've had some experience. It could be how ever trivial. And you've seen an impact. Pricing did impact your business. The second one is having a significant number of things that you sell. So if your ring and you sell doorbells and you have one product. Dynamically pricing the product is going to cause a lot more problems than it solves. But if you're a rental car company with thousands of cars. An hotel company with thousands of rooms. Anything where's there's either a lot of variation over a small number of products or a large number of products with a lot of variation. And finally to us it seems like there's this. That you're already a data focused company. Other people have written about this but you know that there's value in their data. You haven't figured out how to get it out of there yet. Or maybe you're doing some things with it. But you are committed to running your business more efficiently. I guess the marketers would call it a psycho graphic profile but that kind of attitude. You know not being content with. Hey, we've done this for four years this way and its worked great. But really wanted to leverage your data and knowing that there is enough data there. Those are the three things that really give us. >> And we don't really worry about price protection I guess. Nobody goes back once they buy their item their like. This is what I wanted. This is perfect. So and I just wondered too. What industries are people not thinking about maybe that you're starting to see get more involved in dynamic pricing. I mean obviously we know travel and those types. You've mentioned cars a number of times. Talked about kind of some of the crazy stuff that goes on Amazon. But is there other kind of ones that people might never think about? >> I mean I think the two big ones are the transportation trucking industry. There a ton of permutation there and they kind of got left out and went web 1.0. And so I think there's a lot to be done there. The other one is event ticketing. You mentioned the A's and the Giants but they're kind of the exceptions. I think there's a lot of ink that's been spilled over price gouging and scalpers and things like that. And I think that if that is you take a hard look at pricing their products more effectively. Everybody would be better off. Consumers and the promoters and the venues themselves. >> Yes, in the Boss' Letter he likes to talk a lot about the concert industry. Alright well Alex Shartsis. CEO of Perfect Price. Thanks for taking a few minutes our of your day and sharing the story. >> Thank you. >> Alrighty, he's Alex. I'm Jeff you're watching the CUBE from our Palo Alto studios. Happy New Year everybody. See you next time. (upbeat music) Welcome back everybody Jeff Frick here with the CUBE. It's 2018, a new year. I think this is actually my first interview of the year. I'm pretty excited to have a CUBE conversation here in the Palo Alto studios to talk about a pretty interesting topic. It's been growing over time but it's getting more and more Sophisticated in a much bigger region. That's dynamic pricing. It's not just stick the sticker on the item like it used to be back in the day. And that's the price and it's much more complicated. Much more sophisticated and we're excited to have Alex Shartsis. He is the CEO of Perfect Price. Alex, good to see you. >> Thanks for having me. So dynamic pricing, right. We've saw it I guess probably the airlines maybe the first ones to do it. Or Priceline.com was kind of the first one to talk about. Hotels have rooms they can't get rid of. But it's moved a lot further down the path in that. I mean now even the Giants I think have flex pricing whether its the Dodgers on a Friday night. Or it's Toronto on a Tuesday. >> Yeah, I think it's king of a really interesting subject cause everybody has experienced it, right. I mean you may not know you've experienced it but everybody whether you've taken an Uber or taken a flight. Stayed in a hotel. Even at this point gone to an A's game or Giant's game. You've been dynamically priced. And what I think that people don't realize is a lot of times they benefit from it. They're able to get that flight for a little bit less. You're able to get the Uber for a little bit less especially than a taxi. And yeah, sometimes there's surge pricing.

>> Narrator: From the Computer History Museum in the heart of Silicon Valley it's the Cube, covering Food IT: Fork to Farm brought to you by Western digital. >> Hi welcome back to the Cube. We are at the fourth annual Food IT: Fork to Farm event at the Computer History Museum. I'm Lisa Martin with my cohost Jeff Frick Very excited to to welcome our next guest, Paul Noglows, who is the executive producer of the Forbes AgTech Summit. Paul, welcome to the Cube. >> Thank you >> So we're in the heart of Silicon Valley right now, but you are the creator of the Forbes AgTech Summit, which happens tomorrow, June 28th and 29th in Salinas, the salad bowl of America. Talk to us about this event that you've created. What was the genesis of this, and why Salinas? >> We were doing a series at Forbes in 2014 called reinventing America, and we were going around cities mostly in the midwest, but we were mostly looking at industries that were really reinventing themselves and remaking themselves, so we focused on advanced manufacturing in Chicago, we focused on healthcare in Indianapolis, then we went up to Detroit and we focused on reinventing the workforce. So we did a series of five shows over 15 months. And the last one, we thought we were going to reinvent the farm, and we thought we were going to do it somewhere in the Midwest. But we got a proposal from the city of Salinas and they said, why don't you come out and see what we got here, and it's the salad bowl of the world, and I knew Monterey pretty well from having lived out here, and we used to take our kids down to the Monterey Aquarium, but I never really knew Salinas or the Salinas valley. So I got a tour from the former mayor, Dennis Donohue, and it was just we were blown away by how much was going on, and really, it's become the epicenter of AgTech innovation. We're just thrilled at Forbes that we were able to be part of that and to support it. And the summit has grown dramatically over the three years, and so we're really looking forward to a terrific show. >> Tell us about the growth that you've achieved in this summit. The opportunities, the types of people that are there, and what they are going to be able to see and discuss. >> Yeah, We started out with about 400 participants in the summer of 2015, we had 20 startups, but it's really mushroomed from there. This year, we're have 650 participants, we'll have 50 companies in the innovation showcase, we've expanded the field demos and the plant tours to a full day. About a good third of our audience are farmers, and that's really been the secret sauce for us. Is that we've priced the summit right. There's a lot of summits out there, and people are starting to get big numbers for an afternoon at the Marriot Marquee. Ours is really different, we've kept the rate low enough so that farmers can participate, and we love to have everyone outside. We do it all under giant white tent right out in front of the Taylor building on main street in Salinas, and we also have people out at the local processing plants and the local fields. We go out to Hartnell's Alisal campus and we use the USDA test field. >> Its interesting because Salinas has been at the forefront of Ag Innovation a long time ago. It was one of the first refrigerated rail cars to try to get fresh lettuce for salad to Chicago. I remember reading about that numerous times, and the first couple didn't work that well. >> Well it's really amazing. It's been such a privilege to deal with folks Bruce Taylor. It was Bruce's father and grandfather who really were the pioneers of iceburg lettuce. The more you get into it, you know, I've gotten really passionate about it and the history and everything else. You see the continuation today, and with the developments. And, even if it's a Taylor farm putting a startup's robotics, putting them in their processing plants. This is really the cutting edge of AgTech innovation. >> So I'm curious, we cover a lot of big tech events, usually more on the infrastructure side, this is really on the application side. So as you look at cloud, and edge computing, and big data, and mobile, and some of these big trends. What if you can just highlight some of the ones that really jump out to you that have enabled some of these innovations, autonomous vehicles obviously drones, we're seeing so much of it, but now they're putting it to work. >> Yeah, I think you're absolutely right. I mean, there's so much going on. We look in field robotics, we look at precision automation, precision agriculture, and the use of big data, and the ability to harness that and to really apply it, it's changed a lot of things. It's changed the way we can grow. It's also changing consumer's tastes in what consumers want. And that's a lot of what we're talking about here today. So it really has been revolutionary. I think we need the industry, we need to industry to really agriculture itself to get really get together. I think sometimes there still this is looked at as competitive advantage, so what I, we, find interesting is are we going to move beyond competitive advantage and what's good for your plant or your farm. Is there going a collective effort to really start applying this across the agricultural system. >> What are the interesting things that they talked about this morning in the general session was and the theme of the event. We're so used to farm to table, farm to fork, and I looked at that and fork to farm? The consumer is so empowered, very demanding. Right, we want cage free, we want organic, we want hormone free, we want, we've changed the distribution model. How are, but also there's this paradox of the consumer not wanting factory farms. How are farmers, you said quite a bit of the attendees are farmers, how are they embracing this consumer demand with technologies like big data, cloud computing, block chain? >> Well I think it's really the key. It's that you have different farmers and different processors. There's a wide spectrum in terms of adoption and in terms of innovation. But they are putting it to work, and that's why there's so much interest in the startups, and there's so much interest in how can we do this more efficiently, how can we do this better. I think it used to be that you basically needed to have a crisis, like the ecoli crisis, for things to really change in the industry. But hopefully, we've moved beyond that. In that it's not going to take a crisis for folks to really start embracing these new technologies. >> So then in the other trend that has come up in a number of times in doing some background in this show is that there's not only kind of the very organic, cage free specialty demands in the customer. On the other hand, the population is growing, and we got to feed 10 billion people, I think number is projected by 2050. There's no new dirt being created last time I checked, except in Hawaii. How are the farmers embracing that challenge specifically cause, it's kind of this bipolar thing, one you want to increase specialization, on the other hand you got to get yields way way up at massive scale. >> Well, and that's it, and it's really looking at how do you increase yield. This is a lot of the interest. This is a lot of the interest in genetics and everything else and looking at the real science of growing. But it's also interesting in this is a little bit more further afield, but I was talking to Bruce Taylor even about kale. You know 10 years ago kale was considered a throwaway crop. >> Right >> Paul: It wasn't even harvested. And now you look at the impact kale is having on the American diet and you know you have a crop that represented really nothing probably as recently as five years ago. >> Jeff: Right >> Now it's an important crop. So there's all sorts of innovation, all sorts of different ways of looking at things, but I do think for the most part that's the reason we have those things. We've always been adamant that we don't want to get people together to talk about 2050, we're not futurist. We're looking at near term solutions to current problems. So what we're really interested in, you know, what is the farm of 2020 look, not the farm of 2050. >> Jeff: Right, right >> As we look at California that's just come out of this severe drought, the event being hosted in the salad bowl of the, really, the world, what are some of the challenges that are really common across farms, across the heartland of America? Water, planting inefficiencies, harvesting or supply chains, are you seeing a lot of commonalities? >> There are a lot of commonalities. I think there's a mistake. We actually have a conversation tomorrow. I kind of feel like the assumption is all the water problems are over, and the water problems are not over. They maybe over for a short period of time, but I am fully convinced that this is going to be. Two years ago this was the topic du jour at our conference. I'd say this year probably the major topic is labor. And labor, you see, having tremendous impact. You have, across the country. And so, you have the issues of immigration, you've got issues of minimum wage, that certain farms are saying we don't know how we are going to do this. >> Lisa: Right >> We don't know how to make this work. But the major pressures, things like that water, labor, those haven't gone away, and those haven't been solved. But that's why we're all getting together. That's why we're here today, and that's why we're going to be down in Salinas Wednesday and Thursday. >> And on the labor front, it's that you've talked about the Californian minimum wage is going up quite considerably. But it's also things like an aging farming population, and there's, you can see the value there from a big data perspective to be able to capture, to facilitate some automation and drive the next generation of >> Paul: Well >> Lisa: the farmers. >> And one of the ways we're going to close our conference on Thursday afternoon is I'm going to moderate a discussion on farmers of the future. Because we've all heard it, we've all heard it time and time again. The average of the American farmer, I think it's pushing 70 years old, and there's no succession planning and that no body gets into this business unless they're basically born into it or forced into it in some way, and what we're finding is that it's not really true. We're putting up four young farmers, who are really making a difference, and who are applying innovation to be able to build their farms. And so, we think that it's actually more hopeful, and more interesting than may at first blush. So yeah, we do think there is a future for farming, and we're determined to explore it to its fullest. >> That's fantastic. Aught to be a fly on the wall on that conversation. Well Paul, thank you so much for joining us on the Cube, and we wish you the best of luck in your third annual Forbes AgTech Summit in the salad bowl. If you haven't been to Salinas, as Paul said, it's worth a drive down there, it's incredible. Roll down the window, take a nice breath in, and it's a beautiful place. And again, we wish you the best of luck at that summit, and we look forward to hearing about some of the great things that come out of that. >> Paul: Thank you >> And we want to thank you at the Cube at the Food IT: Fork to Farm event, I'm Lisa Martin with my cohost Jeff Frick. Stick around, we're going to be right back.