from the cube studios in Palo Alto in Boston connecting with thought leaders all around the world this is a cube conversation hi I'm Stu minimun and welcome to the cube from our Boston area studios we've been doing a series of CXO leadership discussions talking about how everyone's dealing with the global global endemic I've been welcome program a first-time guest Katy Bullard she is the president of a tile guru of course a cloud guru a online learning company we've had on the cube many times over the years Katy thanks so much thank you so much sue for having me I really appreciate it all right so Katie I remember I saw the in I think the announce was the end of at the beginning of the year your based at the headquarters in Austin you know online you know learning is a huge topic cloud of course you know one of those mega waves that we've been walking a long time and then you know out of nowhere global pandemic you know it's striking us so you know bring us inside you know obviously you know taking a new role in a new organization as it own challenges normally it's like okay what am I going to do for the first 90 days and make that plan tell us you know how were you reacted in how the company has reacted with the koban 19 did you get a chance to look at my 90-day plan dude that was exactly where it was no well let me take you back I'll take you back to kind of why I chose to come to ECG because I think it informs actually what's happening right now as well when I when I was looking for the next opportunity what I look for is I look for two things primarily in a company one is a product that's in a market that's growing really really fast and a product that has raving customer bands and obviously ACG really you know check both of those boxes you think about this is pre Co but if you think about the cloud computing market growing you know 50 60 % a year and the number one challenge for people who are both moving to the cloud or moving to a multi cloud strategy was having enough skilled workers to to do that effectively there really wasn't a better intersection of two you know two who value propositions than what a CG offered which was serving the cloud computing market and skilling up workers in that market fast forward to February you know was interesting I actually went out to Australia offices in mid-february as this was starting to heat up came back just in time I think to not go into quarantine but we very quickly saw the impact and you know this isn't easy for anybody in in any situation but what we are hearing from our customers and from the market is that that move to the cloud is even more important now I think the latest that I saw from the the 2028 odd report said 65 percent of companies are planning a cloud migration 95 percent are of companies are employing a multi cloud strategy so that is accelerating and then of course we're all sitting at home right now and you're getting me in my in my dining room and we have the both learn online versus in person there's no longer in-person training there's no longer events for us to go to lives we're doing that online we also are seeing that you know the way that we use our time is changing so we're not spending hours anymore muting we have a lot of customers who are saying let's use that time instead of muting to learn improve ourselves improve our skills so you know everything is very unpredictable in this environment but we do feel like at ACG our fundamental mission is to help customers get through this to give them the skills that they need so that hopefully as everybody emerges from this later this year they're better positioned to take advantage of the opportunities in front of them ya know you hit on a lot of topics you know so much right now you know remote learning remote work or you know a big discussion the developer world has been looking at that for a long time and you know when I see you know the the the elementary and high school children as well as you know colleges and how they're handling distant learning I was well come on the Cronenberg's brothers you know built something in you know two or three week from your mother's basement Amazon and serverless and they framed millions of people now yeah you know good absolutely translate but it's challenging so I'm curious yes you know and you're working with the team is there anything you're doing to connect to some of the broader audience you know lessons that can be learned as I said you're you know highly scalable you know large scale and you know you have nowhere near the budget of you know these municipalities and colleges yet you do reach you know a very broad audience with some very important skill yes I mean if I think about the actual products itself and why it worked worked so well previously right why the Cronenberg brothers brought to market something that was so beloved but but more importantly why I think it's working so well now is that there was a recognition that we learn these days in bite-sized chunks right most of us don't have four hours a day or three days a week just to sit leave our job and go learn something and so from the very beginning their concept was let's break every single lesson up into these 20 minutes chunks so whether you know I'm on my commute in a previous world or whether I'm you know using some time that I used to spend on the road learning something new I can do it in very digestible forms and in a way that's really engaging to me so I think that model that they've employed from day one is even more valuable now in today's environment I think the other thing is that there was a recognition that we all have different learning styles right we all learn a little bit differently and so whether it's learning in 20 minute chunks so that's learning through video and PowerPoint or whether it's learning hands-on testing things breaking things building things the platform has evolved in a way to enable people no matter where they are in that cloud learning journey whether they're novice that's just getting started and wanting to learn kind of you know the PowerPoint basics like me when I first came on board right of the or a seasoned architect who's trying to get in and build new applications so I think those things are the things that allowed the platform to really resonate with the developer audience for so long and now as we have you know added out of the platform specifically for enterprises where previously you know is for individual developers we now have both I think that's the other thing that is really attractive to large enterprises is the fact that they now right are trying to train thousands of workers at the same time realizing again that every single one of them has a different learning style yeah Katie is as you said before there is you know a broad need or the skill set of cloud computing I'm curious have you seen anything in kind of your customer base either from the enterprise side or individuals is there are there any skill sets that are bubbling up right now that are a critical need or anything that is grown and you know we're curious we're always you know there's some people it's like oh I'm gonna come out of this you know whole experience and you know I love you know work in my home gym and you know learn new languages and become a master baker of sourdough you know me personally I've been really busy so you know I wish I had more spare time travel has definitely reduced thing but it's also given up the time that normally I was gonna you know read a book or you know catch up on raining yeah the sourdough bread is definitely not in my wheelhouse so we well we have seen some really interesting trends actually over the last few months the first one is that we've seen the percentage of our users that are logging in on a daily basis go up about 30 percent so people are taking advantage I think of a little bit of extra time to accelerate their learning the other thing that we are seeing and I was just looking at these stats last week is the kinds of courses and content that are being consumed are changing some of this was happening free covert and some of this was happening post covitz all split those up freako but what we've seen over the last order two 2/4 actually is a pretty significant increase in consumption across multi-cloud skills as you're in particular is seeing about a three times higher increase in consumption than the other two large CCS these although they're all three increasing rapidly so as we think about like the curriculum and our instructors that we're bringing on and what we're building up know historically ACG specifically had grown up in the AWS world but we are responding to that change very very late and in investing in you know a juror GCP and some of the other cloud adjacent courses so that we had been seeing happening over the last couple of quarters most recently what we're seeing is an increase in what i call our beginner or fundamental courses they think that is a direct reflection of people who are looking at this as an opportunity to rescale to set themselves up for a new career i'm so you know our introduction to AWS or introduction to Azure fundamentals or the introduction to DCP those are actually the courses that are increasing the fastest in ranking and anecdotally one of my favorite things to do is to go on LinkedIn or Twitter each day and look at you know what people are saying about ACG and over the last week especially I can't even count the number of folks who've said I'm using my lock down I'm for you know learning or I'm putting my my time and Quarantine to the best use by you know getting trained on ECG and so I think that what we are seeing there is a direct reflection of that alright yeah Katie maybe you can give us a little bit of the update on you know a cloud guru there was the Linux Academy acquisition and if you can share a little bit about this kind of the the the numbers of how many people have gone through your programmed you attract how many people actually get certifications afterwards which I know they need to go to the providers you know pay a fee for that kind of thing yeah we do yeah there's only been a few things happening over here in the last six months right I've got a small acquisition and then you know we're dealing with this now so we acquire Linux Academy in December so actually I came on board about the same time that we acquired the business one of my favorite stories is when I first started talking to Sam and team back in June a cg had about a hundred employees total by the time I was actually accepting an offer in October I think it was 200 employees in total so in a four month span the company had actually doubled we acquired Lenox Academy which was of equivalent size the ACG and so by the end of December we were a 400 person company a company that had been a hundred people know in in the middle of 2019 so 400 people now we are our biggest office is here in Austin we do have a large office in Melbourne Australia which was where the company was originally founded and where Sam is we have an office in London where Ryan is and Linux Academy was actually headquartered right outside of Fort Worth Texas so we've got an office there in Fort Worth as well so it's been amazing to see this company essentially quadruple in size over the last six months everything that goes into scaling a business like that bringing two competitors together integrating the business you know we are in the process of integrating the products and the content and the course dialogues right now so we're excited to bring that market later this year all in the midst of everyone also getting used to this very new and unprecedented environment yeah you know congratulations you know that you know always good to see great growth you know the thing I've noticed is you know ACG just as really goodwill in the community I see the orange shirts at many of the shows I you know right many of the other teams yeah we'll definitely have to get back to you about being on brain feed I was trying to coordinate with my background um one of the other things you know is some of my favorite content over the last few years that we've done the cube has been the serverless cough event so you know any discussion about you know will there be smokers to that or are we just going to need the weight or you know the physical events return before we see those so we actually have just started a new virtual event calendar actually our very first one was yesterday we had almost 3,000 people registering to attend and so it will be a series it's a series of virtual events and webinars that are done in partnership with other leading influencers and practitioners in the industry so expects if anyone's interested you can go online and register for one of the ACG webinars but we'll be having those every two week through the course of this year awesome love that and I guess the last thing Katie there's some other things you've been doing help unity in this need of the pandemic tell us a little bit about that yeah so two things in particular that we've really focused on the first one is across both the Linux Academy and the ACG platforms we have lowered permanently the price of our individual memberships so for individuals from 449 down to 379 we've seen that that has helped enable more people to be able to afford it who otherwise couldn't afford it so that's now in in market the other thing that we're really excited about that we launched this week is a free educational assistance program so we are offering 1,000 subscriptions to ACG for the year so annual subscriptions for people who have been most impacted by kovat so we have a couple of different specific criteria but if you've lost your job due to Ovid and you're in one of the the most heavily impacted industries whether that you know retail or hospitality or travel and are looking to really change careers get into the tech field get your initial certification we do now have a program for that so you go online to our website you're able to apply to that program we launched it yesterday maybe two days ago and I know we already have hundreds of applications so we're really excited to offer that all right well we'll make sure to get this out to the community is build out of that all right Katie thanks so much really pleasure to act up with you and I'm glad Congrats on all the progress thank you so much - thanks for having me alright serverless absolutely one of the topics I've been personally enjoying digging into the last couple years hope you've enjoyed I'm an attorney I'm sue minimun and as always thank you for watching thank you [Music]

[Music] hi and welcome to this cube conversation in the cube Studios in Palo Alto California I'm your host Sonia - Gauri and today we're joined by two guests Justin Warren who is the chief analyst and managing director of pivot 9 and John Troy the chief reckoner of tech reckoning John and Justin welcome to the cube Thanks thanks for having us great so Justin you're in Melbourne Australia John your local to California let's start with Justin Justin you work at pivot 9 tell us a little bit about your role and what you do so I'm the founder and chief analyst steered pivot know and so everything is my fault we we like to help customers with positioning and messaging that's what most of them come to us for so we we maintain a pretty good research focus on the market focus on enterprise infrastructure cloud and information security and our clients come to us for help with positioning into those markets that's awesome and John you're the chief reckoner at Tech reckoning so tell us more about tech reckoning and what you do sure in in a way my keep reckoner is just might know I guess I am also the bottle washer and analyst as well we work with companies that help them with their ecosystem of technologists we work community and influence and advocacy and Deverell is the term of art that people like right now but basically we work we help communities communicate with their their their the ecosystems of which that's great and you're both a host of the cube so let's go down the line John tell us how did you get into hosting the cube and how has that experience been like I was here at cube number one we we started to realize that video streaming was available in a reasonable way at events and I believe we worked we worked with John and Dave and some of the few boats who were Bill around now to bring them to VMworld over ten years ago I was also doing it home at myself with him disappear that we bought it electronic door I'm very quickly looking very welcome to have them take over a functionality for a lot of people and Justin how about you how's your experience been yeah it's been great it's a again happy accident as things started off I happen to nice to I've known him for a few years and they he was in need of submersed hosting spots at a conference that I I happen to be at anyway and I foolishly said yes and now I've done it more than once oh it's is it gets a lot easier after you've done it two or three time are there any tips and tricks you would give okay thank you so much for being on the cube and we will see you next time [Music] you [Music]

(techno music) >> Announcer: Live, from the Moscone Center it's theCUBE. Covering AWS Summit, San Francisco 2018. Brought to you by Amazon Web Services. >> Hello everyone, welcome back to theCUBE's exclusive coverage here in San Francisco, I'm John Furrier with Stu Miniman. This is Amazon Web Services, AWS Summit 2018. We got two great guests, Dave McCann the vice president general manager of AWS Marketplace and Service Catalog and Matthew Scullion is a CEO of Matillion, partner of Marketplace. Guys thanks for coming on good to see you again >> Thank you. >> Thanks for havin' us. >> Alright, so Dave, Marketplace is doing phenomenal, well, we talked with Lew Cirne from New Relic at Reinvent, and was talking about how successful they've been on the Marketplace, so clearly it's working, 170 thousand active customers on stage, we saw the keynote today, What's going on with the Marketplace? Take a minute to explain how the Marketplace is set up now and how it's evolved to this point. >> Thank you, so, great to be back. Can't believe it's four months since Reinvent. So Marketplace is a digital library, of software. You know the cloud is helping our customers innovate faster but you need to be able to innovate with the software not just with the compute and the storage, and so our purpose is to stand up a digital library of software for our customers to subscribe and launch, and we're continuing to grow on multiple dimensions. We've deployed out to all the new standard regions, so we're now up in Korea, we're clearly in LHR so in all the standard regions we've fit Marketplace. And then we continue to expand the library of software, so more and more companies, like a Matillion, publish into the library. We're over 1,300 software companies now, and we're over 4,000 different software titles and you know, our customers show up, they're typically a developer or a manager, with a project with a budget, and they're looking for the best tool that they can keep the project going on schedule. >> And just to make clarification nuances, I know it's commercial and is there a public sector version or is it all one? >> That's a really good question. We actually launched Marketplace last August in our GovCloud Region, so we do actually operate a GovCloud Region for our US government customers and we actually offer a separate Marketplace for the US intelligence agencies. So that's the library of what were doing and we continue tho grow and as Werner said this morning, bunch of new stats. >> The business, the business model obviously people see, um, two things happening. I want to get your reaction to, one is Werner Vogels laid out how services are going to be laid out all over the place and it's not, you know, monolithic as he says. They're all a bunch of services. Scale is a huge factor in enabling that, and also the business model changes are going on, we're seeing people be successful. How are your customers and partners using Marketplace today, how does it work, I mean, do they just call up and say, "Hey! Dave I want to get in the Marketplace." I mean what, I mean, obviously downloading services, enabling services makes sense. How is it working? Like what do they do? Like what's the model? >> So, let's start from the customer and walk backwards. You know Amazon talks about working backwards from the customer. So typically in a company will be a set of developers who are building on us and they'll have a set of architects very often they've a few cloud architects and across the set of software, networking, security, database, dealer analytics, BI, DevOps, all the way to business apps. There'll be a set of architects saying, "What's the best software as we move to the cloud? "Do we bring what we had, or do we buy new?" So the architects are recommending to the developers, "Hey, for your project, here's a good tool." So in the buyer, architects are recommending, and then the developer gets told you can use these vendors. On the seller side of things, software companies like Matillion have to decide "How do we reach the AWS customer?" and then they have to package up their software, put it in our library, and make a bunch of decisions that he can talk about, and then they make it available. >> Yeah Dave it's been interesting to watch kind of the maturation in the Marketplace. It's been large for a number of years but how your partners have changed how they package software, last year there was a discussion that you know, it changed how billing is done, so that Amazon can help make it just seamless for customers, whether they buy service from, you know, AWS or beyond. You know, give us, you used to talk about the customer and the partner, walk us through a little bit of that maturation and how that's that's gone. >> So, we're a six year old service and so we you know we're agile, we keep releasing features. So last year in April, at San Francisco, with Splunk we launched something called SaaS Contracts, which was a new API for SaaS vendors and now we have over 300 SaaS companies in the last year that have developed to that API. So a software vendor can decide they want to deliver as a software package or as an AMI so it could be SaaS or AMI. And we also provision APIs. So we're constantly introducing flexibility on how that vendor can price and package and the more we innovate, the more software companies use our features. >> Yeah, I'm sure you get asked, you know, what's the concern, is there concern, from some of the SaaS players that, "Oh, I'm going to go in there, "I'm going to price and package the way Amazon does, "what's to stop them from just kind of "duplicating what I'm doing and becoming a competitor?" >> You know, that question comes up a lot, and you know look, the software industry is $550 billion. It's growing at 6% a year which is $30 billion and AWS all late last year did about $18 billion. So the software industry is growing by an AWS a year, and the reality is there's so much innovation going on that whatever innovation we're doing, you know, there's lots of room for other software vendors to innovate on top of our stack, 'cause we live in an expanding universe. >> Stu and I always joke, it's like so funny, we look at the, we watch all the cloud, of your competition, you Google Microsoft and Oracle, IBM, whatever, and they all quote numbers. If you factored in the ecosystem, in your number, the cloud revenues would be, I mean trillions. So you know, you guys I know you don't include that, in the numbers and like Microsoft does put Office in there, so it's kind of apples and oranges and so you know, Matthew I want to ask you, 'cause you're a partner. You're doing business on that, so, this is the formula we've been seeing that's been working where, the ecosystem growth, rising tide floats all boats, clearly that's Amazon's strategy. And they're opening up their platform to partners. So talk about what you guys are doing. First, take a minute to explain your company and then talk about your relationship to the Marketplace, and how that's working, and the relationship, how you make money, and the business model behind it. >> Yeah sure, and thanks for the question and for having me. So first of all Matillion, we're a software company, an ISV we make cloud-native data integration technology, purpose-built for this new generation of cloud data warehouses. For us that's Amazon Redshift, it's also Snowflake, and we sell both of those products on the AWS Marketplace, So customers are using us any time when they want to compete with data, so drive product development, or service their customers better, or in fact, become more efficient in the way they run their IT infrastructure. Perhaps migrating an on-premise warehouse into the cloud. So we developed that product through 2014-15, and we were looking for a route to market. Being honest, originally we were going to set it up as a SaaS business, and I saw a pitch from one of Dave's reports, a guy called Barry Russell, talking about AWS marketplace. We're like, okay here's a platform that's going to allow me to deliver my software anywhere in the world to any AWS customer pretty much instantly. More to the point, it's going to deliver my customer a really excellent experience around doing that, from a performance point of view, my software's going to go to go into their VPC sat right next to their data sources, in their Redshift cluster. From a security point of view, that question, very important in data integration, just taken totally off the table, so inside that firewall inside their VPC and of course super convenient and simple to buy. You just access AWS Marketplace, pay with Genuine Cloud Economics by the hour and stand it up pay a few AWS bills. So a really compelling way to deliver the software. >> Was there a technical integration required on your end? I mean like, there's some clients that are born in the cloud Amazon, some are, have built their own stuff. Do you have to, I mean, where are you guys fit into that? One, are you using Amazon? If not, was there any integration piece that you had to do? And if so, what was the level of work required to integrate? >> Yeah, and to be honest, I think this is, you know, the key question on how to be successful selling in this this kind of landscape of public cloud vendor marketplaces and, and the public cloud. So, I mean we're a born on AWS and in fact are born on AWS Marketplace products, and that intersection of product engineering with the route to market, and it's not just the software, it's also the things you surround it with, like great quality content, online support portals, videos, a really great launch experience, that means you're going to be clicked to running our software, commercial-grade ETL tool in under five minutes, free for the first 14 days and then by the hour billing, you know, there's a lot of different angles that go into that and you've absolutely got to be thinking about it. Other people are being successful just kind of sticking their products on the Marketplace and using it just as a billing mechanism but I think for us one of the reasons we've been able to drive great customer resonance and growth, is having that intersection of engineering, content and the Marketplace, together. >> Matthew I wanted have you talk to me a little bit about Matillion, 'cause when I think about kind of customer acquisition, you know Data Warehousing Market's been around for a long time. Redshift's been doing phenomenal, I mean for a while it was the largest, you know, fastest growing product in the AWS you know, portfolio. Being only through the Marketplace, does that, you know, how does that help you get customers, how do they learn about you? Do you ever worry about, like, oh well they just think I'm an Amazon service? Maybe that's a good thing. You know, I'm just curious about kind of that whole go-to-market and relationship with the customers being, you know, super tight, with AWS, you said Snowflake's in there too, so yeah, I'm just curious about that dynamic. >> Yeah, I mean the, the AWS only service thing that historically was a pro and a con. So back in the day we were just Redshift. We're now a couple of other data warehouses as well, you mentioned Snowflake, that's quite right. So that's allowed us to kind of move up the value chain with our customers and give them some choice, which they wanted. Yeah, I think in terms of the go-to-market economics, I mean, we all say this, sometimes its glib, here I think it's authentic. You want to start with what's best for the customer, right. And so we're delivering with genuine cloud economics. Our product starts at $1.37 an hour and yet it'll scale to the world's largest enterprises, and if they don't like it they can turn it off. Typical SaaS products, you're actually signing up for 12 months. So you're not that focused on keeping your customer happy for 11 of those months. Me, I need to keep that customer happy 100% of the time, because he can turn it off any time he likes. >> Yeah, yeah, I always wonder sometimes as an analyst, you know, should it be called a SaaS product if I'm signed into a year or multi-year contract. >> Yeah, so really interesting dynamic of our business is our entire revenue drops by 15% Saturday, Sunday, and it's cause people are turning off dev instances. They come back on Monday morning. Now, as a CEO I could worry about that and say, "Where's my 15% gone Saturday, Sunday?" Actually I'm delighted, 'cause it means my customers are only paying for value they're getting out of the product. >> And then, so about the business model, I wanted to drive into that. I want you to explain and give some color commentary to what your choice was if you didn't have the Marketplace. Hire a sales force? That's going to cost you some money. First you got to find people. >> Yeah. >> Push it to about a thousand customers, run ad campaign. Did you guys do the analysis and say, "Whoa, this is like A,B"? >> Well, so when we launched this product, we were a 12 man company, so I'm not going to say that we rolled in a management consultancy to work that stuff out for us, being honest. But we took a view. I think there have been two big things. First of all, in those very early days when you're trying to find some product market fit, you're trying to find some customers. That global reach instantly delivered by the Marketplace is amazing. So I'm from Manchester UK, apologies for the accent, that's where a good part of our business is still based, although we have offices now in New York and Denver and Seattle as well. If you drill a vertical hole downwards from Manchester, UK, you pop out in Melbourne, Australia that's the first customer we picked up on AWS Marketplace, still a customer today. So in those early guerrilla days, >> No travel, instant global footprint. >> And they were spending money with us before we spoke to them for the first time as well. Now today, we do have a sales force, of course, but it's not a sales force that's closing big deals. They're being value-added, and additive, they are escorting customers through the buying journey, and we've got just as many pre-sales guys as we have sales guys just helping the customer 'cause that's what we want to do. They're going to use the products and consume it 'cause it's easy to do and to turn it off. >> So you focus the high-value activities with the high value employees on the right customer mix, while the rest is just kind of working through the cloud economics. >> Yeah, that's it. Hey, we have to do marketing, of course. We're here doing an event, it's going great. We were lucky enough to be mentioned in the, in the keynote this morning, so our booth's been swamped, >> And now you're on theCUBE, you're a CUBE alumni. >> Exactly. >> The world's going to see, going public next. >> One of the things we do on the marketing front, is when you come into Marketplace and you talk about how we onboard a seller, we have a whole team who we call category managers and so there's an expert over each subject area such as data analytics or networking or security and we not only give them the engineering advice on how to package, on how to onboard and by the way we didn't curate manage so we publish his AMI and he tells us what regions he wants it to go to. And so he may say, clone to Korea, but I don't want it over here, so the seller could decide geography but then we lay on a business go-to-market plan and we actually develop a joint go-to-market. And so we'll do co-marketing with our sellers, and they can choose whether it's by country, by territory, is it large enterprise, is it small business. So there's a set of business advice that we lend. >> So you apply some best practices and some market intelligence on the portfolio side. >> Exactly. >> And the sector. And then we have all the data right? We provide these guys with a real time API they're pulling data off the API every day and what's happening, and so were monitoring that data and everything's measured so this is a digital channel. And then of course the ultimate thing we do when I ran my last SaaS company, we provide the billing platform. And so the buyer comes in on the AWS account, uses the AWS account, so now we bill on behalf of, we do the collection from the buyer, and then we disperse the funds back to the vendor. >> You're making the market for 'em, and they're still doing their blocking and tackling. >> The customer gets a really good experience on their bill and then the customer spend actually becomes visible in Cost Explorer, so we've tagged everything, so we also tagged it so that it's "this is Matillion", and so the customer knows "I'm spending X much on, "X amount of dollars on Matillion on that stack." >> So you're a sales channel and you're adding more value, Matthew, if someone asks you, just say I say, "Hey Matthew, look I got a great product and it's kickin' ass, I want to get into Marketplace" what do I do, what advice would you give me, what would you say? "Oh, I'm skeptical of Amazon's Marketplace" or, "Hey, I really want it". How would you talk to those two tubes of audiences? >> Yeah, so I think the first thing, and we alluded to it earlier, is I think really hard about that 360 experience of packaging the product and how it's launched, that's engineering in the software itself. You need to think about how the customer's going to interact with it, but you also need to clothe that software with great quality content and support, and finally the right type of go-to-market motion around that. And one of the big benefits for us in terms of the AWS Marketplace has been the efficiency of the sales model. So we've got really efficient go-to-market economics and also the types of customers that we sell to and we've, for a company of our stage, you know, we're a post series B, high-growth software company, but for a company of that stage, we are, have a disproportionately high number of global 8,000 global 2,000 customers, that are because Marketplace takes away the barrier of selling into those guys. So as advice on how to be successful, I'd focus on that packaging side and advice as to why to do it, you've got instant worldwide reach into the traditional stomping ground of the the startup other tech vendors but also into the world's biggest software users. >> A virtuous circle, faster to the customers, at a lower cost structure, you still make money, everyone's happy, sounds like a, the Amazon business model. >> It is. >> Great customer experience, great selection, and you know, adoption by the customer, and then continued innovation. Another thing that we do is we have a portal where these guys are publishing new versions, so it's not a one-and-done model. So as these guys update their models, their engineers just publish into seller portal and then that new version comes in, and then we publish that new version out to the customer. So there's a refreshing of the AMI so the latest version is up there. >> And Werner's keynote today really highlighted it's not just about developers anymore, it's about the business teams coming together, pushing stuff real time to the Marketplace is now a business ops model and it's really kind of coming together with entrepreneurial traction and the footprint's a gateway to the world. You have a world footprint. >> Yes, it's 21st century software distribution and really the buyer gets the ultimate choice and you know the buyer can go for an annual contract or for by the hour, so economically, lots of choice. >> Alright, so I'll put you on the spot to end this segment. I'll be a naysayer. Dave you got competition out there, what, what's in it for me? How do you compare vis-a-vis the competition? >> Dave: You're a software vendor? >> Yeah. >> As, you're playin' the persona? >> Yeah, I'm a software guy, I'm looking at marketplaces, you know, why you guys? >> You know, you have to go where the customer is, ultimately you have to decide who your customer is. You know, Werner talked this morning about the tens of thousands of companies that are up on AWS, and so, if I've got 170 thousand buyers showing up on my marketplace, and they're intentional on their budget, and you're a software vendor you get reach, and given what Gartner says on where we are, on fulfilling share in cloud, is where the customer is. >> And if you're a service too, software service APIs, it's even better goodness there. >> Yeah we have thousands of consulting partners also use Marketplace as a library so if you're an SI, and we have tens of thousands of SIs, those SIs also view Marketplace as a good place to find software for the project. >> You've been in this business for a while. I mean, we've always talked about this on theCUBE, I want to ask you real quick, I mean more than ever now, ecosystems and communities are paramount, priority. Especially with this kind of dynamic 'cause that ecosystem is that fabric to enable, you know, go-to-markets that are seamless with economic scale, visibility into the numbers, what's your reaction when someone says that comment to you about community and an ecosystem? >> Well you know, an ecosystem is a collection of software companies that inter-operate. And the reality is that our customers are rewriting all the software. The world is rewriting its software portfolio. You know, a large customer I went to see recently has a thousand software applications. Now as they move them all to the cloud, they're either rewriting or they're modernizing, but as they rewrite them, they're going to use distributed services, they're going to use micro-services. And so they're refreshing their entire stack. >> Yeah, it's a re-platforming of the internet. >> Transformational. >> Dave McCann, who runs the Marketplace for AWS. Really kickin' butt out there. Congratulations on all your success, and I know there's a lot more to do, I wish we had more time, I'd love to do a follow-up with you and find out what's going on the Marketplace. and Matthew a partner, congratulations, hyper-growth, hittin' that trajectory. Congratulations, we'll come visit you in Manchester and then we'll drill a hole, we'll go to Melbourne right down there. Appreciate, thanks for coming on theCUBE, thanks. >> Thank you. >> I'm John Furrier and Stu Miniman. More live coverage after this short break. We are in San Francisco, live for AWS Summit 2018. We'll be right back. (techno music)

>> Narrator: Live, from Las Vegas, it's The Cube. Covering InterConnect 2017. Brought to you by IBM. >> Welcome back, everyone. Live here in Las Vegas, this is The Cube's coverage of IBM's Interconnect 2017. I'm John Furrier with my co-host Dave Vellante. Our next guest is Eric Herzog, Cube alumni, Vice President of Product Market at IBM storage. Welcome back to The Cube. Good to see you with the shirt on. You got the IBM tag there, look at that. >> I do. Well, you know, I've worn a Hawaiian shirt now, I think, ten Cubes in a row, so I got to keep the streak going. >> So, pretty sunny here in Vegas, great weather. Storage is looking up as well. Give us the update. Obviously, this is never going away, we talk about it all the time, but now cloud, more than ever, a lot of action happening with storage, and data is a big part of it. >> Yeah, the big thing with us has been around hybrid cloud. So our software portfolio, the spectrum family, Spectrum Virtualize, Spectrum Protect, our backup package, Spectrum Scale, our scale out NAS, IBM Cloud Object Storage, all will move data transparently from on-premises configurations out to multiple cloud vendors, including IBM Bluemix. But also other vendors, as well. That software's embedded on our array products, including our VersaStack. And just two weeks ago, at Cisco Live in Melbourne, Australia, we did a announcement with Cisco around our VersaStack for the hybrid cloud. >> So what's the hybrid cloud equation look like for you guys right now, because it is the hottest topic. It's almost like brute force, everywhere you see, it's hybrid cloud, that's what people want. How does it change the storage configurations? What's the solutions look like? What's different now than it was a year ago? >> I think the key thing you've got to be able to do is to make sure the data can move transparently from an on-premise location, or a private cloud, you could have started as a private cloud config and then decid it's OK to use a public cloud with the right security protocols. So, whether you've got a private cloud moving to a public cloud provider, like Bluemix, or an on-premises configuration moving to a public cloud provider, like Bluemix, the idea is they can move that data back and forth. Now, with our Cisco announcement, Cisco, with their cloud center, is also providing the capability and moving applications back and forth. We move the data layer back and forth with Spectrum Virtualize or IBM's copy data management product, Spectrum Copy Data Management, and with Cloud Center, or the ECS, Enterprise Cloud Sweep, from Cisco, you can move the application layer back and forth with that configuration on our VersaStacks. >> So this whole software-defined thing starts, it started when people realized, hey, we can run our data centers kind of the way the big hyper-scalers do. IBM pivoted hard toward software-defined. What's been the impact that you've seen with customers? Are they actually, I mean, there was a big branding announcement with Spectrum and everything a while back. What's been the business impact of that shift? >> Well, for us, it's been very strong. So if you look at the last couple quarters, according to the analysts that track the numbers, from a total storage perspective, we've moved into the number two position, and have been, now for the last two years. And for software-defined storage, we're the number one provider of software-defined storage in the world, and have been for the last three years in a row. So we've been continuing to grow that business on the software-defined side. We've got scale-up block configurations, scale-out block configurations, object storage with IBM Cloud Object Storage, and scale-out NAS and file with our IBM Spectrum Scale. So if you're file, block, or object, we've got you covered. And you can use either A, our competitor's storage, we work with all our competitor's gear, or you could go with your reseller, and have them, or your distributor provide the raw infrastructure, the servers, the storage, flash or hard drives, and then use our software on top to create essentially your own arrays. >> So when you say competitor's gear, you're talking about what used to be known as the SAN Volume Controller, and now is Spectrum Virtualize, right? Did I get that right? >> Yes, well, we still sell the SAN Volume Controller. When you buy the Spectrum Virtualize, it comes as just a piece of software. When you buy the SAN Volume Controller as well as our FlashSystem V9000, and our Storwize V7 and V5000, they come with Spectrum Virtualize pre-loaded on the array. So we have three ways where the array is pre-loaded: SAN Volume Controller, FlashSystems V9000, and then the Storwiz products, so it's pre-loaded. Or, you can buy the stand-alone software Spectrum Virtualize and put it on any hardware you want, either way. >> So, I know we're at an IBM conference, and IBM hates, they don't talk about the competition directly, but I have to ask the competitive questions. You've had a lot of changes in the business. Obviously, cloud's coming in in a big way. The Dell EMC merger has dislocated things, and you still see a zillion starups in storage, which is amazing to me, alright? Everybody says, oh, storage is dead, but then all this VC money still funneling in and all this innovation. What's happening in the storage landscape from your perspective? >> Well, I think there's a couple things. So, first of all, software-defined has got its legs, now. When you look at it from a market perspective, last quarter ended up at almost 400 million, which put it on a, let's say, a 1.6 to 2 billion dollar trajectory for calendar 2017, out of a total software market of around 16 billion. So it's gone from nothing to roughly 2 billion out of 16 billion for all storage software of all various types, so that's hot. All flash arrays are still hot. You're looking at, right now, last year, all flash arrays end up at roughly 25% of all arrays shipped. They're now in price parity, so an all-flash array is not more expensive. So you see a lot of innovation around that. You're still seeing innovation around backup, right? You've got guys trying to challenge us with our SpectrumProtect with some of these other vendors trying to challenge us, even though backup is the most mature of the storage software spaces, there's people trying to challenge that. So, I'd say storage is still a white-hot space. As you know, the overall market is flat, so it is totally a drag out, knock-down fight. You know, the MMA and the UFC guys got nothing on what goes on in the storage business. So, make sure you wear your flak jacket if you're a storage guy. >> Meaning, you got to gain share to grow, right? >> Yes, and it's all about fighting it out. This Hawaiian shirt looks Hawaiian, but just so you know, this is Kevlar. Just in case there's another storage company here at the show. >> So what are the top conversations now with storage buyers? Because we saw Candy's announcement about the object store, Flex, for the cold storage. It changes the price points. It's always going to be a price sensitive market, but they're still buying storage. What are those conversations that you're having? You mentioned moving data around, do they want to move the data around? Do they want to keep it at the edge? Is it moving the application around? What are some of those key conversations that you're involved in? >> So we've done a couple innovative things. One of the things we've done is worked with our sales team to create what we call, the conversations. You know, I've been doing this storage gig now for 31 years. Seven start-ups, IBM twice, EMC, Maxtor and Seagate- >> John: You're a hardened veteran. >> I'm a storage veteran, that's why this is a Kevlar Hawaiian shirt. But no CIO's a storage guy, I've never met one, in 31 years, ever, ever, ever met a storage guy. So what we have to do is elevate the conversation when you're talking to the customer, about why it's important for their cloud, why it's important for machine learning, for cognitive, for artificial intelligence. You know, this about it, I'm a Star Trek guy. I like Star Wars, too, but in Star Trek, Bones, of course, wands the body. So guess what that is? That's the edge device going through the cloud to a big, giant server farm. If that storage is not super resilient, the guy on the table might not make it. And if the storage isn't super fast, the guys on the table might not make it. And while Watson isn't there, yet, Watson Health, they're getting there. So, in ten years from now, I expect when I go to the doctor, he's just like in Star Trek, waving the wand, and boy, you better make sure the storage that that wand is talking to better be highly resilient and high performing. >> Define resilient, in your terms. >> So, resilient means you really can't have more than 30 seconds, 50 seconds a year of down time. Because whoever's on the table when that thing goes down has got a real problem. So you've got to be up all the time, and if you take it out of the healthcare space and look at other applications, whether you look at trading applications, data is the new gold. Data is the new diamonds. It's about data. Yes, I'd love to have a mound of gold, but you know what, if you have the right amount of data, it worth way more than a mound of gold is. >> You're right about the CIO and storage. They don't want to worry about storage. They don't want to spend a lot of time thinking about it. A CIO once said to me, "I care about storage like this, "I want it to be dirt cheap, lightning fast, and rock solid." Now, the industry has done a decent job with rock solid, I would say, but up until Flash, not really that great with lightning fast, and really not that great with dirt cheap. Price has come down for the hardware, but the management has been so expensive. So, is the industry attacking that problem? And what's IBM doing? >> Yeah, so the big thing is all about automation. So when I talk about moving to the hybrid cloud, I'm talking about transparent migration, transparent movement. That's an automation play. So you want to automate as much as you can, and we've got some things that we're not willing to disclose yet that'll make our storage even more automated whether it be from a predictive analytics perspective, self-healing storage that actually will heal itself, you know, go out and grab a code load and put the new code on because it knows there's a bug in the old code, and do that transparently so the user doesn't have to do anything. It's all about automating data movement and data activity. So we've already been doing that with the Spectrum family, and that Spectrum family ships on our storage systems and on our VersaStack, but automation is the critical key in storage. >> So I wonder, does that bring up new KPIs? Like, I presume you guys dog food your own storage internally, and your own IT. >> Eric: Yes >> Are you seeing, because it used to be, OK, the light's green on the disc drive, and you know, this is our uptime or downtime, planned downtime, you know, sort of standard metrics that we've known for 30-40 years. With automation, are we seeing a new set of metrics in KPIs emerge? You know, self-healing, percentage of problems that corrected themselves, or- >> Well, and you're also seeing things like time spent. So if you go back to the downturn of seven, eight, and nine, IT was devastated, right? And, as you know, you've seen a lot of surveys that IT spend is basically back up to '08, OK, the pre-08 crash. When you open up that envelope, they're not hiring storage guys anymore, and usually not infrastructure guys. They're hiring guys to do devops and testdev, and do cloud-based applications, which means there's not a lot of guys to run the storage. So one of the metrics we're seeing is, how much guys do I have managing my storage, or, my infrastructure? I used to have 50, now I'm a big bank, can I do it with 25? Can I do it with 20? Can I do it with 15? And then, how much time do they spend between the networking, the storage, the facilities themselves. These data center guys have to manage all of that. So there are new metrics about, what is the workload that my actual human beings are doing? How much of that is storage versus something else? And there's way less guys doing storage as a full-time job, anyway, because what happened in the downturn? And, so automation is critical to a guy running a datacenter, whether he's a cloud guy, whether he's a small shop. And clearly in the Fortune, global 2500, those guys, where they've got in-house IT, they've cut back on the infrastructure team and the storage team, so it's all about automation. So, part of the KPIs are not just about the storage itself, such as uptime, cost per Gig, cost per transaction, the bandwidth, you know, those sorts of KPIs. But it's also about how much time do I really spend managing the storage? So if I've only got five guys, now, and I used to have 15 guys, those five guys are managing, usually, three, to four, to five times more storage than they did in 2008 and 2009. So now you've got to do it with five guys instead of 15, so there's a KPI, right there. >> So, what about cloud? We heard David Kinney talk today about the object store with that funny name, and then he talked about this cloud-tiering thing, and I couldn't stay. I had to get ready for theCube. How do you work with those guys? How do you sell a hybrid story, together, because cloud is eating away at the traditional infrastructure business, but it's all sort of one big, happy family, I'm sure. But how do you work with a cloud group to really drive, to make the water level higher for IBM? >> So, all of our products from the Spectrum family, not all, but almost all our products from the Spectrum family, will automatically move data to the cloud, including IBM Bluemix/SoftLayer. So our on-premises can do it. If you buy our software only, and don't buy our storage arrays, or don't buy a Storwize, or don't buy a flash system, you still can automatically move that data to the cloud, including the IBM cloud object store. Our Spectrum Scale product, for example, ScaleOut NAS, and file system, which is very highly used in big data analytics and cognitive workloads, automatically, by policy, will tier-data to IBM cloud object storage. Spectrum Protect can be set up to automatically take data and back it up from on-premises to IBM cloud object storage. So we've automated those processes between our software and our array family, and IBM cloud object storage, and Bluemix and SoftLayer. And, by the way, in all honesty, we also work with other cloud vendors, just like they work with other storage vendors. All storage vendors can put data in Bluemix. Well, guess what, we can put data in clouds that are not Bluemix, as well. Of course, we prefer Bluemix. We all have IBM employee stock purchase, so of course we want Bluemix first, but if the customer, for whatever reason, doesn't see the light and doesn't go to Bluemix and goes with something else, then we want to make sure that customer's happy. We want to get at least some of the PO, and our Spectrum family, and our VersaStack family, and all of our array family can get that part of the PO. >> You need versatility to be on any cloud. >> Eric: We can be on any cloud. >> So my question for you is, the thing that came out of our big data, Silicon Valley event last week was, Hadoop was a great example, and that's kind of been, now, a small feature of the overall data ecosystem, is that batch and real time are coming together. So that conversation you're having, that you mentioned earlier, is about more real time than there is anything else more than ever. >> Well, and real time gets back to my examples of Bones on Star Trek wanding you over healthcare. That is real time, he's got a phaser burn, a broken leg, a this and that, and then we know how to fix the guy. But if you don't get that from the wand, then that's not real time analytics. >> Speaking of Star Trek, just how much data do you think the Enterprise was throwing off, just from an IOT standpoint? >> I'm sure that they had about a hundred petabytes. All stored on IBM Flash Systems arrays, by the way. >> Eric, thanks for coming on. Real quick, in the next 30 seconds, just give the folks a quick update on why IBM storage is compelling now more than ever. >> I think the key thing is, most people don't realize, IBM is the number two storage company in the world, and it has been for the last several years. But I think the big thing is our embracing of the hybrid cloud, our capability of automating all these processes. When they've got less guys doing storage and infrastructure in their shop, they need something that's automated, that works with the cloud. And that's what IBM storage does. >> All right, Eric Herzog, here, inside theCube, Vice President of Product Market for IBM Storage. I'm John Furrier, and Dave Velante. More live coverage from IBM InterConnect after this short break. Stay with us. (tech music)