(lively music) >> Narrator: Live, from San Francisco, celebrating 10 years of high tech coverage, it's theCUBE, covering VMworld 2019! Brought to you by VMware and its ecosystem partners. >> Okay, welcome back to theCUBE's live coverage in VMworld 2019. We're in San Francisco. We're in Moscone North Lobby. I'm John Frer, my co Stu Miniman, here covering all the action of VMworld, two sets for theCUBE, our tenth year, Stu. Keeping it going. Two great guests, John Fanelli, CUBE Alumni, Vice President of Product, Virtual GPUs at NVIDIA Kevin Gray, Director of Product Marketing, Dell EMC. Thanks for coming back on. Good to see you. >> Awesome. >> Good to see you guys, too. >> NVIDIA, big news, we saw your CEO up on the keynote videoing in. Two big announcements. You got some stats on some Windows stats to talk about. Let's talk about the news first, get the news out of the way. >> Sure, at this show, NVIDIA announced our new product called NVIDIA Virtual Compute Server. So for the very first time anywhere, we're able to virtualize artificial intelligence, deep learning, machine learning, and data analytics. Of course, we did that in conjunction with our partner, VMware. This runs on top of vSphere and also in conjunction with our partner at Dell. All of this Virtual Compute Server runs on Dell VxRail, as well. >> What's the impact going to be for that? What does that mean for the customers? >> For customers, it's really going to be the on-ramp for Enterprise AI. A lot of customers, let's say they have a team of maybe eight data scientists are doing data analytics, if they want to move through GPU today, they have to buy eight GPUs. However, with our new solution, maybe they start with two GPUs and put four users on a GPU. Then as their models get bigger and their data gets bigger, they move to one user per GPU. Then ultimately, because we support multiple GPUs now as part of this, they move to a VM that has maybe four GPUs in it. We allow the enterprise to start to move on to AI and deep learning, in particular, machine learning for data analytics very easily. >> GPUs are in high demand. My son always wants the next NVIDIA, in part told me to get some GPUs from you when you came on. Ask the NVIDIA guy to get some for his gaming rig. Kidding aside, now in the enterprise, really important around some of the data crunching, this has really been a great use case. Talk about how that's changed, how people think about it, and how it's impacted traditional enterprise. >> From a data analytics perspective, the data scientists will ingest data, they'll run some machine learning on it, they'll create an inference model that they run to drive predictive business decisions. What we've done is we've GPU-accelerated the key libraries, the technologies, like PyTorch, XGBoost to use a GPU. The first announcement is about how they can now use Virtual Compute Server to do that. The second announcement is that workflow is, as I mentioned, they'll start small, and then they'll do bigger models, and eventually they want to train that scale. So what they want to do is they want to move to the cloud so they can have hundreds or thousands of GPUs. The second announcement is that NVIDIA and VMware are bringing Virtual Compute Server to VMware Cloud running on AWS with our T4 GPUs. So now I can scale virtually starting with fractional GPU to single GPU to multi GPU, and push a button with HCX and move it directly into AWS T4 accelerated cloud. >> That's the roadmap so you can get in, get the work done, scale up, that's the benefit of that. Availability, timing, when all of this is going to hit in-- >> So Virtual Compute Server is available on Friday, the 29th. We're looking at mid next year for the full suite of VMware Cloud on top of Aws T4. >> Kevin, you guys are supplier here at Dell EMC. What's the positioning there with you guys? >> We're working very closely with NVIDIA in general on all of their efforts around both AI as well as VDI too. We'll work quite a bit, most recently on the VDI front as well. We look to drive things like qualifying the devices. There's both VDI or analytics applications. >> Kevin, bring us up-to-date 'cause it's funny we were talking about this is our 10th year here at the show. I remember sitting across Howard Street here in 2010 and Dell, and HP, and IBM all claiming who had the lowest dollar per desktop as to what they were doing in VDI. It's a way different discussion here in 2019. >> Absolutely. Go ahead. >> One of the things that we've learned with NVIDIA is that it's really about the user experience. It's funny we're at a transition point now from Windows 7 to Windows 10. The last transition was Windows XP to Windows 7. What we did then is we took Windows 7, we tore everything out of it we possibly could, we made it look like XP, and we shoved it out. 10 years later, that doesn't work. Everyone's got their iPhones, their iOS devices, their Android devices. Microsoft's done a great job on Windows 10 being immersive. Now we're focused on user experience. When the VDI environment, as you move to Windows 10, you may not be aware of this, but from Windows 7 to Windows 10, it uses 50% more CPU, and you don't even get that great of a user experience. You pop a GPU in there, and you're good. Most of our customers together are working on a five-year life cycle. That means over the next five years, they're going to get 10 updates of Windows 10, and they're going to get like 60 updates of their Office applications. That means that they want to be future-proof now by putting the GPUs in to guarantee a great user experience. >> On the performance side too, obviously. In auto updates, this is the push notification world we live in. This has to built in from day one. >> Absolutely, and if you look at what Dell's doing, we really built this into both our VxRails and our VxBlocks. GPUs are just now part of it. We do these fully qualified. It stacks specifically for VDI environments as well. We're working a lot with the n-vector tools from VM which makes sure we're-- >> VDI finally made it! >> qualifying user experience. >> All these years. >> Yes, yes. In fact, we have this user experience tool called n-vector, which actually, without getting super technical for the audience, it allows you to look at the user experience based on frame-rate, latency, and image quality. We put this tool together, but Dell has really been taking a lead on testing it and promoting it to the users to really drive the cost-effectiveness. It still is about the dollar per desktop, but it's the dollar per dazzling desktop. (laughing) >> Kevin, I hear the frame-rate in there, and I've got all the remote workers, and you're saying how do I make sure that's not the gaming platform they're using because I know how important that is. >> Absolutely. There's a ton of customers that are out there that we're using. We look at folks like Guillevin as like the example of a company that's worked with us and NVIDIA to truly drive types of applications that are essential to VDI. These types of power workers doing applications like Autodesk, that user experience and that ability to support multiple users. If you look at Pat, he talked a little bit about any cloud, any application, any device. In VDI, that's really what it's about, allowing those workers to come together. >> I think the thing that the two of you mentioned, and Stu you pointed out brilliantly was that VDI is not just an IT thing anymore. It really is the expectation now that my rig, if I'm a gamer, or a young person, the younger kids, if you're under 25, if you don't have a kick-ass rig, (laughs) that's what they call it. Multiple monitors, that's the expectation, again, mobility. Work experience, workspace. >> Exactly, along those same lines, by the way. >> This is the whole category. It's not just like a VDI, this thing over here that used to be talked about as an IT thing. >> It's about the workflow. So it's how do I get my job done. We used to use words like "business worker" and "knowledge worker." It's just I'm a worker. Everybody today uses their phone that's mobile. They use their computer at home, they use their computer at work. They're all running with dual monitors. Dual monitors, sometimes dual 4K monitors. That really benefits as well from having a GPU. I know we're on TV so hopefully some of you guys are watching VDI on your GPU-accelerated. It's things like Skype, WebEX, Zoom, all the collaboration to 'em, Microsoft Teams, they all benefit from our joint solution, like the GPU. >> These new subsystems like GPUs become so critical. They're not just subsystem, they are the main part because the offload is now part of the new operating environment. >> We optimized together jointly using the n-vector tool. We optimized the server and operating environment, so that if you run into GPU, you can right-size your CPU in terms of cores, speed, etc., so that you get the best user experience at a most cost effective way. >> Also, the gaming world helps bring in the new kind of cool visualization. That's going to move into just the workflow of workers. You start to see this immersive experience, VR, ARs obviously around the corner. It's only going to get more complex, more needs for GPUs. >> Yes, in fact, we're seeing more, I think, requirements for AR and VR from business than we are actually for gaming. Don't you want to go into your auto showroom at your house and feel the fine Corinthian leather? >> We got to upgrade our CUBE game, get more GPU focused and get some tracing in there. >> Kevin, I know I've seen things from the Dell family on levering VR in the enterprise space. >> Oh, absolutely. If you look at a lot of the things that we're doing with some of the telcos around 5G. They're very interested in VR and AR. Those are areas that'll continue to use things like GPUs to help accelerate those types of applications. It really does come down to having that scalable infrastructure that's easy to manage and easy to operate. That's where I think the partnership with NVIDIA really comes together. >> Deep learning and all this stuff around data. Michael Dell always comes on theCUBE, talks about it. He sees data as the biggest opportunity and challenge. In whatever applications coming in, you got to be able to pound into that data. That's where AI's really shown... Machine learning has kind of shown that that's helping heavy lifting a lot of things that were either manual. >> Exactly. The one thing that's really great about data analytics that are GPU-accelerated is we can take a job that used to take days and bring it down to hours. Obviously, doing something faster is great, but if I take a job that used to take a week and I can do it in one day, that means I have four more days to do other things. It's almost like I'm hiring people for free because I get four more extra work days. The other thing that's really interesting as our joint solution is you can leverage that same virtual GPU technology. You can do VDI by day and at night, you run Compute. So when your users aren't at work, you migrate them off, you spin up your VMs that are doing your data analytics using our RAPIDS technology, and then you're able to get that platform running 24 by seven. >> Productivity gains just from an infrastructure. Even the user too, up and down, the productivity gains are significant. So I'll get three monitors now. I'm going to get one of those Alienware curved monitors. >> Just the difference we had, we have a suite here at the show, and just the difference, you can see such a difference when you insert the GPUs into the platform. It's just makes all the difference. >> John, I got to ask you a personal question. How many times have people asked you for a GPU? You must get that all the time? >> We do. I have a NVIDIA backpack. When I walk around, there's a lot of people that only know NVIDIA for games. So random people will always ask for that. >> I've got two sons and two daughters and they just nerd out on the GPUs. >> I think he's trying to get me to commit on camera on giving him a GPU. (laughing) I think I'm in trouble here. >> Yeah, they get the latest and greatest. Any new stuff, they're going to be happy to be the first on the block to get the GPU. It's certainly impacted on the infrastructure side, the components, the operating environment, Windows 10. Any other data you guys have to share that you think is notable around how all this is coming together working from user experience around Windows and VDI? >> I think one piece of data, again, going back to your first comment about cost per desktop. We're seeing a lot of migration to Windows 10. Customers are buying our joint solution from Dell which includes our hardware and software. They're buying that five-year life cycle, so we actually put a program in place to really drive down the cost. It's literally like $3 per month to have a GPU-accelerated virtual desktop. It's really great Value for the customers besides the great productivity. >> If you look at doing some of these workloads on premises, some of the costs can come down. We had a recent study around the VxBlock as an example. We showed that running GPUs and VDI can be up as much as 45% less on a VxBlock at scale. When you talk about the whole hybrid cloud, multi-cloud strategy, there's pluses and minuses to both. Certainly, if we look at some of the ability to start small and scale out, whether you're going HCI or you're going CI, I think there's a VDI solution there that can really drive the economics. >> The intense workloads. Is there any industries that are key for you guys in terms of verticals? >> Absolutely. So we're definitely looking at a lot of the CAD/CAM industries. We just did a certification on our platforms with Dassault's CATIA system. That's an area that we'll continue to explore as we move forward. >> I think in the workstation side of things, it's all the standard, it's automotive, it's manufacturing. Architecture is interesting. Architecture is one of those companies that has kind of an S and B profile. They have lots of offices, but they have enterprise requirements for all the hard work that they do. Then with VDI, we're very strong in financial services as well as healthcare. In fact, if you haven't seen, you should come by. We have a Bloomberg demo for financial services about the impact for traders. I have a virtualized GPU desktop. >> The speed is critical for them. Final question. Take-aways from the show this year, 2019 VMworld, Stu, we got 10 years to look back, but guys, take-aways from the show that you're going to take back from this week. >> I think there's still a lot of interest and enthusiasm. Surprisingly, there's still a lot of customers that haven't finished there migration to Windows 10 and they're coming to us saying, Oh my gosh, I only have until January, what can you do to help me? (laughing) >> Get some GPUs. Thoughts from the show. >> The multi-cloud world continues to evolve, the continued partnerships that emerge as part of this is just pretty amazing in how that's changing in things like virtual GPUs and accelerators. That experience that people have come to expect from the cloud is something, for me is a take-away. >> John Fanelli, NVIDIA, thanks for coming on. Congratulations on all the success. Kevin, Dell EMC, thanks for coming on. >> Thank you. >> Thanks for the insights. Here on theCUBE, Vmworld 2019. John Furrier, Stu Miniman, stay with us for more live coverage after this short break. (lively music)

>> Announcer: Live from San Francisco, celebrating ten years of high-tech coverage, it's theCUBE! Covering VMworld, 2019. Brought to you by VMware and its ecosystem partners. >> Kay welcome back everyone, live CUBE coverage here at VMworld 2019 in San Francisco, we're in Moscone North lobby, I'm John Furrier. My cohost Stu Miniman. We're here with two great guests, David Appel, Vice President C2 Space and Intelligence and Defense, Civil Solutions at Raytheon, and Gil Shneorson, who's the senior vice president general manager of VxRail, of Dell EMC, great to have Raytheon, anything with space Stu and I get jacked up for that. Thanks for coming on. >> Yeah I appreciate it, thank you, I'm glad to be here. >> Gil, VxRail, got a customer here, impressive role out. Talk about the story. >> Well I think it starts with the fact that we have recently announced our support for Pivotal community services over VMware Cloud Foundation over VxRail which has actually the only Q-rated automated stacking industry that allows people to leverage containers and infrastructure as a service on one stack and we've been doing this for about three years now in a different way called Pivotal Ready Architecture and Raytheon has actually adopted that architecture to help their customer, the air force. And that's why we're here today together to talk about you know. >> Seriously modernization couldn't be a more important conversation in government solutions, you guys are a big provider, Raytheon, known for the tech chops, known for having good engineering. Talk about the solution, what you guys did, what's the use case, talk about the deployment. >> Yes with what's going on with the federal government for a while is the acquisition processes and what's taking sometimes years or decades to get software in the field is causing a lot of unmet requirements and needs of the ultimate user, the war fighters out in the field, to be met. So we've been on a journey for the last two years with Pivotal and Dell of how to help the air force, modernize the air force has gone under a transformation and a program called Kessel Run which is where we've deployed the Pivotal Ready Architecture to allow us to quickly deploy an infrastructure and allow us to focus on the end users and develop the capabilities that they need worldwide. And what took years and to now months and days so it's been a fantastic journey. >> Tell us what that means for the folks that might not know the pace of the procurement process. I mean some of this stuff is like 1995 procurement rules. I mean modernization these days is such an important part of it because the impact is significantly relevant. Share some color into the process. >> If you think about in the commercial world today where hundreds of applications be deployed overnight and updates on the what, hourly basis. In the government space it can literally take years to define a requirement, then you have to go through a budgeting cycle all the way up through congress and then you have to go through an acquisition cycle that could take a year to complete and so by the time you're actually fielding capability it is literally five years or more by the time the need was actually identified. And in that five years the technology probably changed which means your solution has probably changed from what's currently available. So shortening the cycles is what it's all about. >> And that's really about having the right product at the right time, not the old product five years ago. How fast things change, it's pretty important to have that nailed down. >> It's pretty amazing and you know I think you look at transformation and there's usually a trade off. What we have been working on and what we're announcing but really what we've been leaving over the last four years is a way to transform but stay close to your core. In other words transformation without trade offs. And so if you can get your VMware stack now running containers in a fully managed automated stack you don't have to change your skill set and you can do all of that and start innovating while staying very close to your core competency. You know you transform but you don't have to go too far and I think the story what Raytheon did is fairly amazing because they turned, you know, what did you tell me, a 50-year-old process, you know in like in less than half a year you turned automated systems that you know saves the US air force a lot of money. >> And lives too, are saved. I mean you're talking about people in the field, this is about people's lives too, I mean this is the money making. >> And it's been about transforming the culture of the way the DoD does software and the first example that Gil is mentioning was tanker planning which was the ability for the air force to refuel flight missions in the air, would typically take over eight hours to plan. And it was done by a white board. It was done manually. And in order to automate that and shrink the time, again that would have gone to that five year procurement cycle. We were able to deploy new applications using the Pivotal-ready architecture within 150 days and get those out worldwide to the field. That's done two things. It's from a financial perspective it's saving over $200,000 a day in just fuel costs from optimizing the tanker planning. But more importantly it's actually more efficient and protecting the safety of those flight crews. They're not in the air as long, they might not be in a hostile environment as long, so the security of the air force is even more important. >> As Pivotal always says they're outcome driven and that's pretty good outcome. I mean talk about the impact that you've had on everyone else around you because I'm sure there's some blockers in your way, people's feathers got ruffled, but then people see success they want to come copy it, right? So that's a pattern you see in a lot of government work. Hey there's a new way to do it, modern way. >> Yeah so our hindsight we're seeing it in two ways. One from a broader DoD perspective. The air force was out front here. They established this and from a DoD perspective what they're calling their Kessel Run initiative is really taking off. You're seeing other Kessel Run like programs being stood up like a program called Kobayashi Maru and Rogue Blue and a few others across DoD. So it's proliferating out across the DoD from a customer perspective, DoD customer perspective. From an industry perspective you know our competitors are quickly trying to catch up to us and they're trying to, you know, copy our playbook but we're continuing to innovate and continue on this journey so we're moving ahead with Pivotal and Dell. >> First of all David I think Pat Gelsinger must have been talking to your team because you're mashing up Star Wars and Star Trek with Kessel Run and Kobayashi there. But talk about mashing up, the stack that you're putting together, VxRail was really built around simplicity. It delivers that, that's what hyperconverged infrastructure does. You start talking about VCF and containers and PKS on that, Kubernetes nobody says is simple, but you know help us walk through, you know, how simple is it for you to leverage and deploy this. You've got organizational challenges and other things, so, you know, where is the solution, it sounds like you use the ready node, and where directionally is it headed? >> Yeah let me answer from this perspective. So we started this journey with Pivotal and the air force about two years ago. And at that time we started with a group of probably a dozen or less folks that actually even understood the technology or the products and the solutions that Dell and Pivotal bring forward. In those two years we're now up to over 100 people. Fully embracing the technology. It's creating an environment where it's easier for us to recruit and retain people because it's modern, it's not the old ways we used to do business. And we're finding that it's been very easy to deploy, very easy to train people up and very easy to operate. So from that perspective it's just been fantastic from not just the technology perspective but also the cultural transformation perspective. >> Yeah Gil I'd love you to comment on that because you know remember gosh when CI and HCI first rolled out you know the people that had those jobs were worried we were going to take their jobs away. Now when I hear your customer talking about, you know, it's easy to train them and even easier for me to recruit and retain, a powerful story. Are you hearing that across your customer base? >> Yeah I'll tell you what's a little different. In the past we have simplified things and we've made work somewhat go away but there was no alternative work. Today every developer, every IT person, they can't wait to go and be a dev ops person, right? So for IT when we come in and we say we're going to take this off your plate so you can free up your time, it really means something now, 'cause they know exactly what they want to do. They want to go and they want to be dev ops, they want to develop new apps, they want to move forward. And so it's very syngergistic in a way that we offload some of the burden from them and they actually do free up to do cooler stuff and then they like it. >> And they get to keep their traditional apps, with containers, gives them great capabilities. Not the throwaway. >> And that's a great point I think as I said before and it's really important to convey this, the transformation without trade offs is a big deal because they can keep the application. They can run the same environment. Right in our case they can do it you know at ease and in remote locations all over the world with less management. And at the same time they can innovate and manage those environments. And I think as long as we can keep that up we'll make a lot of people productive. >> Well I got to ask David the security question because one of the things that comes up all the time obviously Department of Defense, security's top of mind. Industrial IOT are now not just malware getting in for credit card information, you're talking about actual equipment, you're talking about flights in the air, hacking with physical things is a concern and it's a big IOT kind of conversation. You're in the middle of that, this is your world. What's your thoughts on the security? >> You know so we've obviously had to go through that in order to get authority to operate to push things into theater and one of the strongest benefits we've seen is the dev ops process and the platforms has all that security built in and all the testing as we're going through it. So the thousands of tests that are running as new threats are identified, the platform is updating with the latest patches or whatever it may be, so. >> John: On the automation stuff? >> On the automation side of it. So we're actually seeing a lot of the security, I don't want to call it risks go away, but our ability to mitigate them is being built into the software itself. So we haven't seen an issue yet where we haven't been able to get things authority to operate and push it out to the field, so. >> There's a high bar there too, obviously. >> It's a very high bar, very high bar, and that was part of the also the challenge of getting systems fielded in months and days versus years because of the ability to get that operations. >> Now this is a really big story I think. First of all Raytheon's a well-known brand, but, the modernization of getting stuff into theater and or into your production theater, military operations, that's a big deal, I mean, I think people don't really understand that aren't in government how fast this happens. I think that's a real testament to the solution, so I mean. >> Well the powerful thing to it is the national defense strategy is all about capability at the speed of relevance, and that's all about technology. Future wars aren't going to be decided by the size of your army or the size of your arsenal. It's going to be about how do you get data to decision makers faster and how do they can act faster. And that's where software and this infrastructure we're putting in place and putting capabilities in the hands of people that need it faster. That's what it's all about. >> And you know Secretary Matthis who was former Secretary of Defense said 48% of all the casualties are usually frontline war fighters. And that's where the technology edges so to speak. So again this is such a cutting edge topic, talk about it for days. How do you feel about this? This is pretty exciting. >> I'm just happy that every time I come into theCUBE, this is the second time I do it with a customer, you give me the opportunity to learn, you know, have a deeper relationship with one of my of probably now 7,000 customers. Which you know is really hard to keep up with these days and so you know we make technologies for people to use and when you see it in the field doing good it's a great thing. >> Well it's a transformation story. It's really a great transformation story. They have to, making a difference. >> Great, David, would love to hear, you know, what's on your ask for your partners that are deploying. Kind of give us a look forward roadmap that you can share. >> Yeah again I go back to everything we're about right now is speed and and getting capability faster. Currently in our marketplace right now we're fully embracing agile dev ops and everything it takes to deploy software from that perspective. Moving into things like artificial intelligence and machine learning and autonomy are the big things that are on our horizon from a technology perspective. And as our partners are in those areas and can help us bring more capability in that, that's going to help our end customer, the DoD, faster as well, so. >> What's the big takeaway from VMworld this year for you guys? What's the big observation? >> I'll be honest this is my first time at VMware. I'm amazed, I was at Dell Technology World a few months ago, I've really enjoyed it, I think it's a great event. And I'm just enjoying learning all the technologies so, it's, I've enjoyed the day. >> Gil what's your big takeaway? >> Well I'm part of the family. So I'm a little more familiar and even for me-- >> Whoever: You were briefed. >> No, no, even for me the rate of innovation that Vmworld puts out there is amazing. Right and you see how everything plugs together and you see how the vision keeps being, you know, completed, right, and we're in a good spot in the sense that we actually have what people need right now. And we do it better than everybody else. And you'd think that being number one in almost every category you'd be sitting there complacent and no, you know, we keep pushing the envelope, doing more innovating, more integrating more, so it's very exciting to see what's happening. >> Well great story here, Raytheon congratulations for your success I think it's super important to have a prepared military, certaintly, and saving lives and doing it in a modern way is kind of of a miracle these days in government, so congratulations. >> And I thank our partners for continuing to innovate 'cause that's helping us so. >> All right, great story, CUBE coverage here, Vmworld 2019, I'm John Furrier with Stu Miniman. We'll be back with more after this short break. (upbeat electronic music)

>> Voiceover: Live from San Francisco, celebrating 10 years of high tech coverage, it's theCUBE. Covering VMworld 2019. Brought to you by VMware and its ecosystem partners. >> Welcome back, everyone, CUBE's live coverage for VMworld 2019 in Moscone North, in San Francisco, California. I'm John Furrier with Dave Vellante. Dave, our 10 years, we have Eric Herzog, the CMO and vice president of Global Storage Channels at IBM. CUBE alum, this is his 11th appearance on theCUBE at VMworld. That's the number one position. >> Dave: It's just at VMworld. >> Congratulations, welcome back. >> Well, thank you very much. Always love to come to theCUBE. >> John: Sporting the nice shirt and the IBM badge, well done. >> Thank you, thank you. >> What's going on with IBM in VMworld? First, get the news out. What's happening for you guys here? >> So for us, we just had a big launch actually in July. That was all about big data, storage for big data and AI, and also storage for cyber-resiliency. So we just had a big launch in July, so we're just sort of continuing that momentum. We have some exciting things coming out on September 12th in the high end of our storage product line, and then some additional things very heavily around containers at the end of October. >> So the open shift is the first question I have that pops into my head. You know, I think of IBM, I think of IBM Storage, I think of Red Hat, the acquisition, OpenShift's been very successful. Pat Gelsinger was talking containers, Kubernetes-- >> Eric: Right. >> OpenShift has been a big part of Red Hat's offering, now part of IBM. Has that Red Shift, I mean OpenShift's come in, to your world, and how do you guys view that? I mean, it's containers, obviously, is there any impact there at all? >> So from a storage perspective, no. IBM storage has been working with Red Hat for over 15 years, way before the company ever thought about buying them. So we went to the old Red Hat Summits, it was two guys, a dog, and a note, and IBM was there. So we've been supporting Red Hat for years, and years, and years. So for the storage division, it's probably one of the least changes to the direction, compared to the rest of IBM 'cause we were already doing so much with Red Hat. >> You guys were present at the creation of the whole Red Hat movement. >> Yeah, I mean we were-- >> We've seen the summits, but I was kind of teeing up the question, but legitimately though, now that you have that relationship under your belt-- >> Eric: Right. >> And IBM's into creating OpenShift in all the services, you're starting to see Red Hat being an integral part across IBM-- >> Eric: Right. >> Does that impact you guys at all? >> So we've already talked about our support for Red Hat OpenShift. We do support it. We also support any sort of container environment. So we've made sure that if it's not OpenShift and someone's going to leverage something else, that our storage will work with it. We've had support for containers now for two and half years. We also support the CSI Standard. We publicly announced that earlier in the year, that we'd be having products at the end of the year and into the next year around the CSI specification. So, we're working on that as well. And then, IBM also came out with a thing that are called the Cloud Paks. These Cloud Paks are built around Red Hat. These are add-ons that across multiple divisions, and from that perspective, we're positioned as, you know, really that ideal rock solid foundation underneath any of those Cloud Paks with our support for Red Hat and the container world. >> How about protecting containers? I mean, you guys obviously have a lot of history in data protection of containers. They're more complicated. There's lots of them. You spin 'em up, spin 'em down. If they don't spin 'em down, they're an attack point. What are your thoughts on that? >> Well, first thing I'd say is stay tuned for the 22nd of October 'cause we will be doing a big announcement around what we're doing for modern data protection in the container space. We've already publicly stated we would be doing stuff. Right, already said we'd be having stuff either the end of this year in Q4 or in Q1. So, we'll be doing actually our formal launch on the 22nd of October from Prague. And we'll be talking much more detail about what we're doing for modern data protection in the container space. >> Now, why Prague? What's your thinking? >> Oh, IBM has a big event called TechU, it's a Technical University, and there'll be about 2,000 people there. So, we'll be doing our launch as part of the TechU process. So, Ed Walsh, who you both know well and myself will be doing a joint keynote at that event on the 22nd. >> So, talk a little bit more about multi-cloud. You hear all kinds of stuff on multi-cloud here, and we've been talkin' on theCUBE for a while. It's like you got IBM Red Hat, you got Google, CISCO's throwin' a hat in the ring. Obviously, VMware has designs on it. You guys are an arms dealer, but of course, you're, at the same time, IBM. IBM just bought Red Hat so what are your thoughts on multi-cloud? First, how real is it? Sizeable opportunity, and from a storage perspective, storage divisions perspective, what's your strategy there? >> Well, from our strategy, we've already been takin' hybrid multi-cloud for several years. In fact, we came to Wikibon, your sister entity, and actually, Ed and I did a presentation to you in July of 2017. I looked it up, the title says hybrid multi-cloud. (Dave laughs) Storage for hybrid multi-cloud. So, before IBM started talkin' about it, as a company, which now is, of course, our official line hybrid multi-cloud, the IBM storage division was supporting that. So, we've been supporting all sorts of cloud now for several years. What we have called transparent cloud tiering where we basically just see cloud as a tier. Just the way Flash would see hard drive or tape as a tier, we now see cloud as a tier, and our spectrum virtualized for cloud sits in a VM either in Amazon or in IBM Cloud, and then, several of our software products the Spectrum line, Spectrum Protect, Spectrum Scale, are available on the AWS Marketplace as well as the IBM Cloud Marketplace. So, for us, we see multi-cloud from a software perspective where the cloud providers offer it on their marketplaces, our solutions, and we have several, got some stuff with Google as well. So, we don't really care what cloud, and it's all about choice, and customers are going to make that choice. There's been surveys done. You know, you guys have talked about it that certainly in the enterprise space, you're not going to use one cloud. You use multiple clouds, three, four, five, seven, so we're not going to care what cloud you use, whether it be the big four, right? Google, IBM, Amazon, or Azure. Could it be NTT in Japan? We have over 400 small and medium cloud providers that use our Spectrum Protect as the engine for their backup as a service. We love all 400 of them. By the way, there's another 400 we'd like to start selling Spectrum Protect as a service. So, from our perspective, we will work with any cloud provider, big, medium, and small, and believe that that's where the end users are going is to use not just one cloud provider but several. So, we want to be the storage connected. >> That's a good bet, and again, you bring up a good point, which I'll just highlight for everyone watching, you guys have made really good bets early, kind of like we were just talking to Pat Gelsinger. He was making some great bets. You guys have made some, the right calls on a lot of things. Sometimes, you know, Dave's critical of things in there that I don't really have visibility in the storage analyst he is, but generally speaking, you, Red Hat, software, the systems group made it software. How would you describe the benefits of those bets paying off today for customers? You mentioned versatility, all these different partners. Why is IBM relevant now, and from those bets that you've made, what's the benefit to the customers? How would you talk about that? Because it's kind of a big message. You got a lot going on at IBM Storage, but you've made some good bets that turned out to be on the right side of tech history. What are those bets? And what are they materializing into? >> Sure, well, the key thing is you know I always wear a Hawaiian shirt on theCUBE. I think once maybe I haven't. >> You were forced to wear a white shirt. You were forced to wear the-- >> Yes, an IBM white shirt, and once, I actually had a shirt from when I used to work for Pat at the EMC, but in general, Hawaiian shirt, and why? Because you don't fight the wave, you ride the wave, and we've been riding the wave of technology. First, it was all about AI and automation inside of storage. Our easy tier product automatically tiers. You don't have, all you do is set it up once, and after that, it automatically moves data back and forth, not only to our arrays, but over 450 arrays that aren't ours, and the data that's hottest goes to the fastest tier. If you have 15,000 RPM drives, that's your fastest, it automatically knows that and moves data back and forth between hot, fast, and cold. So, one was putting AI and automation in storage. Second wave we've been following was clearly Flash. It's all about Flash. We create our own Flash, we buy raw Flash, create our own modules. They are in the industry standard form factor, but we do things, for example, like embed encryption with no performance hit into the Flash. Latency as low as 20 microseconds, things that we can do because we take the Flash and customize it, although it is in industry standard form factor. The other one is clearly storage software and software-defined storage. All of our arrays come with software. We don't sell hardware. We sell a storage solution. They either come with Spectrum Virtualize or Spectrum Scale, but those packages are also available stand-alone. If you want to go to your reseller or your distributor and buy off-the-shelf white-box componentry, storage-rich servers, you can create your own array with Spectrum Virtualize for block, Spectrum Scale for File, IBM Object Storage for Cloud. So, if someone wants to buy software only, just the way Pat was talking about software-defined networking, we'll sell 'em software for file blocker object, and they don't buy any infrastructure from us. They only buy the software, so-- >> So, is that why you have a large customer base? Is that why there's so much, diverse set of implementations? >> Well, we've got our customers that are system-oriented, right, some you have Flash system. Got other customers that say, "Look, I just want to buy Spectrum Scale. "I don't want to buy your infrastructure. "Just I'll build my own," and we're fine with that. And the other aspect we have, of course, is we've got the modern data protection with Spectrum Protect. So, you've got a lot of vendors out on the floor. They only sell backup. That's all they sell, and you got other people on the floor, they only sell an array. They have nice little arrays, but they can't do an array and software-defined storage and modern data protection one throat to choke, one tech support, entity to deal with one set of business partners to deal with, and we can do that, which is why it's so diverse. We have people who don't have any of IBM storage at all, but they back up everything with Spectrum Protect. We have other customers who have Flash systems, but they use backup from one of our competitors, and that's okay 'cause we'll always get a PO one way or another, right? >> So, you want the choice as factor. >> Right. >> Question on the ecosystem and your relationship with VMware. As John said, 10th year at VMworld, if you go back 10 years, storage, VMware storage was limited. They had very few resources. They were throwin' out APIs to the storage industry and sayin' here, you guys, fix this problem, and you had this cartel, you know, it was EMC, IBM was certainly in there, and NetApp, a couple others, HPE, HP at the time, Dell, I don't know, I'm not sure if Dell was there. They probably were, but you had the big Cos that actually got the SDK early, and then, you'd go off and try to sell all the storage problems. Of course, EMC at the time was sort of puttin' the brakes on VMware. Now, it's totally different. You've got, actually similar cartel. Although, you've got different ownership structure with Dell, EMC, and you got (mumbles) VMwware's doin' its own software finally. The cuffs are off. So, your thoughts on the changes that have gone on in the ecosystem. IBM's sort of position and your relationship with VMware, how that's evolved. >> So, the relationship for us is very tight. Whether it be the old days of VASA, VAAI, V-center op support, right, then-- >> Dave: V-Vault, yeah yeah. >> Now, V-Vault two so we've been there every single time, and again, we don't fight the wave, we ride the wave. Virtualization's a wave. It's swept the industry. It swept the end users. It's swept every aspect of compute. We just were riding that wave and making sure our storage always worked with it with VMware, as well as other hypervisors as well, but we always supported VMware first. VMware also has a strong relationship with the cloud division, as you know, they've now solved all kinds of different things with IBM Cloud so we're making sure that we stay there with them and are always up front and center. We are riding all the waves that they start. We're not fighting it. We ride it. >> You got the Hawaiian shirt. You're riding the waves. You're hanging 10, as you used to say. Toes on the nose, as the expression goes. As Pat Gelsinger says, ride the new wave, you're a driftwood. Eric, great to see you, CMO of IBM Storage, great to have you all these years and interviewing you, and gettin' the knowledge. You're a walking storage encyclopedia, Wikipedia, thanks for comin' on. >> Great, thank you. >> All right, it's more CUBE coverage here live in San Francisco. I'm John Furrier for Dave Vellante, stay with us. I got Sanjay Putin coming up, and we have all the big executives who run the different divisions. We're going to dig into them. We're going to get the data, share with you. We'll be right back. (upbeat music)

>> Announcer: Live, from San Francisco, celebrating 10 years of high-tech coverage, it's theCUBE. Covering VMworld 2019. Bought to you by VMware and its ecosystem partners. >> Welcome back to theCUBE's live coverage here at Vmworld 2019, San Francisco, California. We're in Moscone North Lobby. I'm John Furrier, with my co-host Dave Vellante. Dave, 10 years of covering VMworld. This is our 10th year. Pat, you've been on every year since 2010. We have photos. >> That's sort of scary. >> You had a goatee back then. (Pat laughs) We've heard your rap going way back. Welcome back, good to see you. >> Oh man, scary. You guys probably got some dirt on me. Boy, I better be careful. >> John: Pat Gelsinger, the CEO of VMware on theCUBE. Thanks for coming on this evening. >> Oh, always a pleasure to be on with you guys, love it. >> Don't end up as driftwood. Security is a do over. We're going to talk about all that. >> We're going to spend the entire segment just talking about Pat Gelsinger's predictions. We'll recycle some of them, but let's get into the core news here, VMworld. You've done such an amazing job. We've given you a lot of props on theCUBE over the years, but still continuing, even in the market climate that's swinging up and down right now, VMware still producing great results. The team is executing. Their transition since October 2016 when you kind of made that move, cloud is it, clear vision, a lot's been falling into place. Pivotal has dropped on your lap, and you got the engineering stuff coming out on top of vSphere and a bunch of other things. Great stuff, I mean, you must be geeking out. >> Well, thank you. At the US gymnastics finals, Simone Biles did a triple double. First time ever in competition. And I think of our last week as a triple double, right, two major acquisitions, an earnings call, and now VMworld and all the announcements as part of it. It's like wow. >> John: You stick the landing, you stick the landing. >> That's right, we did yesterday morning. We stuck the landing and Ray did that today as well. So super proud of the team in bringing these across the line. And I think certainly meeting with many of the customers and the partners here everybody's sort of going wow. And I was excited about VMware before I got here. Now I'm just euphoric, and it's really-- >> I'm told Ray did an exceptional job. I'm going to talk to him later today on theCUBE. Today in his keynote he was great. He repeated the messages over and over again, but he nailed the tech piece. I got to ask you, as the engine of VMware is continuing to be put together and expand it's like a new turbo engine gets pulled in here. There's a lot of really good engineering going on. What are you most excited about? How would you describe all the action going on? If someone says, "Pat, what's the underlying engine here?" What's being built? What's going to be the outcome of all this? >> Well, I think it sort of boils down to, right, these two phrases that you heard from me yesterday. We're going to engineer for good, the tech for good stuff, we're going to do good engineering. And doing both of those is just okay. And you sort of say, "Hmm, we got vSAN," right? We're not being able to optimize the performance because big blocks, little blocks, latency, buffer size, all this other kind of stuff, so now we're doing Magna, right? And when you see that demonstration there, it's like we're going to do it automatically for you to be a fine-grain optimizing your storage. Wow, that's pretty cool, and it's intelligence, right? It's sort of saying, "Wow, this is really cool." So let's go automatically produce an understanding of the underlying network, understand what's going on, give you the rules that we recommend, and allow you to simulate them, which is super cool, right? Within minutes, we will give the network engineer more understanding of what's really going on in our applications, and then allow them to see it in real time and then apply it. Every one of these, and it's just 10 or 15 tremendous engineers who are doing these little innovations that are fundamentally changing the industries that they're in, in addition to the big stuff. It's just thrilling. >> Dave did a survey before coming into VMworld with customers with a panel. 41% said they're not going to change their spending habits with VMware so creating the-- >> Dave: They said they're going to increase-- >> Increase. >> In the second half, only 7% said they're going to decrease. >> So great customer loyalty, and remember, VMware's moving so fast and transit. Customers aren't moving as fast as you guys are, and you've talked about that before. What are you hearing from customers as they look at it and say, "Wow, is it too much new stuff?" 'Cause they want to continue to operate, but they also want to enable the developer piece. Because remember, DevOps means dev and ops. You guys got the ops piece down. You're adding stuff to it. There's always concerns there making sure it's smooth and you guys work on that. The dev piece becomes super critical. That's where Amazon really shined with public cloud. So hybrid cloud's here. What is the DevOps equation for hybrid? I mean Kubernetes is a good start. Where do you see it going? >> Yeah, and that's really the center. To me, that is the most important news of VMworld this year is the entire Tanzu message, the coming together of Pivotal, the coming together of Pacific, coming together with Mission Control, so really leveraging VMware in the run layer, leveraging Pivotal in the build, and Heptio in the manage, right, and those coming together into Tanzu. I think that's the most important thing that we're doing. And I think for operators, which is really the center of our audience here at VMworld, they've always struggled with those crazy developers. They do this cool new stuff. It's not operational, it's not secure. But in bringing those together, the magic formula for that is Kubernetes. And that's why we're making these big bets. The move with Pivotal, obviously the Heptio guys, I mean Joe Beda and Craig, they're just the rock stars of that community because they really are solving in an industry-consensual standard way. That's really the magic of Kubernetes. This ain't a VMware thing, this is an industry thing. >> Is Kubernetes the technology enabler? I mean, TCP/IP was that in the old networking days. It enabled a lot of shifts in the industry. You were part of that wave. Is Kubernetes that disruptive enabler? >> Yeah, I really see it as one of those key transition points in the industry. And as I sort of joked, if my name was Scott, and we were 20 years ago, I'd be banging the table calling it Java. And Java defined enterprise software development for two decades. By the way, Scott's my neighbor. He's down the hill, so I look down on Mr. McNealy. I always sort of like that. (everybody laughs) >> He looks up to you. >> But it changed how people did enterprise software development for the last two decades. And Kubernetes has that same kind of transformative effect, but maybe even more important, it's not just development but also operations. And I think that's what we're uniquely bringing together with Project Pacific, really being able to bridge those two worlds together. And if we deliver on this, I think the next decade or two will be the center of innovation for us, how we bridge those two roles together and really give developers what they need and make it operator friendly out of the box, cross the history to the future. This is pretty powerful. >> So that does lead to the big question. You just mentioned developers. And when you look out the VMworld audience, it's not comprised of huge developers. I know you're thinking about this, so what's your plan to attract those developers? You're giving them platform now, and the technologies. but those builders, what are you going to do for them? Is it build community, more events, more training? What's the plan there? >> Yeah, and I'd say I think about it in a couple of different context. One is if we were here six years ago, and you would have asked me about open source, right? I mean, VMware's reputation in the open source community wasn't good, right? We hired Dirk, we started to build momentum, make contributions. One of the litmus tests for Joe and Craig on Heptio, 'cause remember, a lot of people could have bought Heptio. Because some was who's going to be the buyer, but also will they be a willing seller. And their litmus test was are you really serious about open source, right? Are you really committed to the open source, Kubernetes tree and development and cloud-native computing foundation? Are you really there? 'Cause they were also looking do I want to be bought by you? Do I want to be part of the VMware family? And we passed the test. That's why Heptio's part of the team. Clearly, this has been central to Pivotal and their views. So we have to be open-source credible. We also have to be developer credible, and those two are tightly linked. And that's why we noted on stage Pivotal, particularly the Java community, is three-plus million developers. Bitnami is two million-ish developers. We now have high volume connections to the developer community, and you're going to see us show up in dramatically more profound ways at places like Kubicon and SpringOne is coming up, just start to be in the developer spaces. And ultimately, you got to do stuff that they care about. At the end of the day, winning developers has nothing to do with great marketing, even though that's important. You have to do great code, right, and bring them value to their development assignments. And we think with the assets that we're lining up, that's why we did Pivotal, Bitnami, Heptio, some of our organic things, Dirk's leadership here. I believe that a year or two from now VMware could be seen as the most developer and open source enterprise company in the industry. And that's the goal that I'm on. >> Well, I have an idea for you. Allocate 1,000 engineers to open source and start having them build new applications, new workloads, give it away to the open source community, and then sell your products and services to them. That would get you in fast. >> Well, by the way, we now have hundreds of engineers who are committed to open source, who their full-time job is open source contributions. So I'm not to 1,000 yet, but I'm now several hundred that their day job, night job, weekend job is open source contribution. So we're becoming very credible, and as you heard me say in the keynote, we are now top three contributor to Kubernetes. This is big, and some areas like the networking area we're clearly the leader in a number of the key networking open source technologies, and you'll see us do more of those kind of projects. >> One of the things you mentioned, I mean you mentioned about open source six years ago, you might have rolled your eyes, or you might not have had an opinion on it 'cause the timing of where VMware was. But one thing you've been banging the drum on since 2012 is hybrid cloud. And so you see certain things early. You see those waves. That's what you're known for, in my opinion. You're really good about it. You see blockchain as a great wave, but as a headline I'm reading on Fortune it says, "VMware CEO Pat Gelsinger, "Bitcoin is bad for humanity." >> Sold all my bitcoin (laughs). >> Okay, so now are you implying then, and blockchain is a lot of open source components there. It's evolving, you've a lot of blockchain projects. So is that an indictment on the unregulated currency market or is it the underlying infrastructure? And are you excited about blockchain as an underlying? Is it one of those hybrid cloud moments for you, or is it more of we'll see how it develops? What's your thoughts? And explain the bitcoin comment too. >> Yeah, the idea of distributed ledger technology, immutable distributed trust, I've said I think of that and blockchain as the underlying technology as almost like public private key encryption, right? If we go back 40 years before RSA or Vashumi and Ari, it's that important. This is breakthrough, innovative technology in how you do distributed secure trust. That's powerful, so we are huge believers, strongly committed to blockchain and distributed leverager technology. Now, why do I make my comments like I do on bitcoin? So bitcoin, as it's implemented, and implementation of blockchain and distributed ledger, I assert is bad. It's bad for two reasons. One is it's an environmental crisis, right? A single ledger, if you and I transacted a penny, right, I would consume enough energy to power your house for half a day. I mean, it's incredible, and I mean, that's why you have these crazy bitfarms being built and people finding GPUs. >> So you think from a sustainability standpoint. >> Absolutely. >> That's where you came from. >> Climate sustainability, right, this is a terrible implementation of blockchain. Secondly, the way it's also done as well in this totally unregulated environment, almost all of its uses are for illicit and criminal purposes. That's who's trading in bitcoin as well. So its purpose is almost all illicit, right, and it's environmental crisis. I say bad. Now, I'm not saying that blockchain is bad. I think this is revolutionizing. >> I want to make sure we clarify that because obviously unregulated outside the United States has been a big problem. We see it in the SEC crackdown, and results are-- >> Studies have shown over 95% of the use of bitcoin is criminal, so say bad. Let's go make it good, and that's what I mean these two phrases, do good engineering, and engineer for good. How do we make blockchain, and this is part of the reason, we had just announced on Sunday a partnership with Australian Stock Exchange and Data Asset, that they're leveraging the VMware distributed ledger technology, right, as part of their go-forward strategy for the stock exchange of Australia. Well, that's good, right? We're making it suitable for enterprises, meeting the regulatory requirements and-- >> John: Are you happy with the progress of where the blockchain is for you guys? >> Absolutely, and we're order-plus magnitude better in terms of performance and energy consumption. So yeah, and we're just getting started. >> And it's consensus-based, which is great. A quick question for you on multicloud. So hybrid cloud you said in 2012, I challenged you on it, and you've been banging the drum since 2012. It's a couple years into it, and hybrid cloud is pretty much standard. People see it, recognize it as the cloud 2.0. Multicloud is all the buzz and all the rage. I hear it everywhere. What does it actually mean is a different debate, so I want to get your thoughts on defining what multicloud is and is it going to have that same gestation period of the same kind of years? 'Cause if it's seven years to get or six years to get hybrid cloud mainstream, is multicloud going to have a similar trajectory? >> Yeah, so let's try to be very crisp with the definition. Multicloud is simply that. Customers using multiple clouds for different business purposes. And what we said is is that we're going to help them manage. That's the center point of cloud health, right? Help customers manage, cost optimize, secure in a multicloud environment where the underlying infrastructure is dissimilar, not compatible, right? And in that sense, you sort of say you can have consistent operations if we do our job well with cloud health, but you're not going to have consistent infrastructure, meaning I can't VMotion between these things, I can't have higher these things. So that's the multicloud. Now a proper subset of multicloud is hybrid cloud. And hybrid cloud is where you have both consistent operations and consistent infrastructure. And that's when we can do things like you saw on the demo today, right? We're running a VMware stack on Azure. We're moving Azure running workloads in real time, right, without stunning them, pausing them, to an Amazon VMC instead of moving workloads from Amazon VMC onto an Azure instance. That's the hybrid cloud, and that's the power at work, from private data centers to multiple different targets in the public cloud where you can be optimizing the location of work nodes based on the proper business requirements. And that might be governance. That might be performance. It might be latency. It might be the time of the day of the week when you have capacity available, right? And that's really what we're saying. Consistent operations and consistent infrastructure, proper subset of multicloud. >> I have a question on something you said yesterday. You said, "Strength lies in differences not similarities." True, I buy that. There's a number of difference between you and your preferred public cloud partner. AWS doesn't use the term multicloud. They say you shouldn't say security's not broken. And there are a number. You want to be the best infrastructure and developer software company. They want to be that platform. They want to be the security cloud, on and on and on. So I see this impending collision course, maybe not tomorrow, but what are your thoughts on the differences and the good or bad that does for the industry? >> Yeah, well, we appreciate Amazon, the investments that we're making. We've both bet big with each other, and they've been a great partner. And in fact, I'm going to talk to Andy before the end of the week, update some of the announcements and some of the things. Great partner, we have regular cadence of our activities with each other. And as we said, they're our preferred public cloud partner. And with it, it's preferred in two senses. It's a go to market and how we position that, but it's also an R&D statement, right? This is where we're doing a lot of core engineering, and that will flow into private cloud embodiments, flow into our other public cloud and our cloud-verified partners. But that's the point of the arrow in terms of the innovations, the go to market, and the R&D aspects of the partnership. And I expect we're going to be here five years from now and we're going to have this conversation, and I'm going to answer it exactly the same way. >> That'll be our CUBE's 15th anniversary, and so we'll be excited for that. It's our 10 year, so I want to last question put you on the spot, looking back over 10 years, pick the moments that you think were key inflection points. What were key notable good things that happened, bad things that happened, or things that didn't happen, right? And then going forward 10 years, you laid out a few of them with Kubernetes. Just past 10 years, could be CUBE memories, but in VMware's world, you were at EMC first, then became CEO, a lot's changed. Paul Maritz laid out the original vision. And where we are today, what's your key moments? >> Yeah, well, I think if you go all the way back, obviously, hey when the first WSX, right, people could run Linux and Windows on their client. Wow, right? The first VMotion, right, oh my gosh, and that sort of ushered in ESX. Obviously the transition from Diane to Paul, the public offering, boy, that was a pretty tumultuous time. And from Paul to Pat was very much we lay it out pretty much this any cloud vision, and that model, it was formative and we're sort of bringing it together. It was get rid of some assets, bring together, so sort of that transition was challenging for the company. But then we've started to sort of systematically say build from the core. What do we have? What do we need as we started to build these layers in the concentric circles? The Nicira acquisition, boom, that was the shot that changed the world of networking. And obviously, that doesn't change quickly, but we have a multibillion dollar networking business, Avi Networks, VeloCloud, we're building that set of assets. >> Software-defined data centers. The Core engine, that was a key point. >> Dave: That was a total game changer. >> You cannot build a software-defined data center if you don't address the networking. It's just that simple, and that's why I was so passionate about that. Obviously, the HCI move with vSAN. Joe Tucci was so pissed off at me, right? (everybody laugh) What are you doing? It's operative. It's part of the ingredients of the data center, Joe. I got to do it, wait. >> John: Just being a software company. >> Yeah, yeah, right, so that was a pretty tense moment. The period of the Dell EMC merger, a tough period, right, as well, and just where the company's going to go. And within a week, right, I'm going to be fired. I'm going to be spun out, right? I'm going to be the new CEO of Dell, right? I mean, it was going to be HP. >> John: All the rumor. >> Stock is 40, obviously the Amazon moment, when we did that partnership. vCloud Air, hey, we had the right idea. We didn't implement it properly, and then we did it right with the Amazon partnership, and that just changed the cloud industry. And I think we're going to look at today, this week, and the moves with Heptio, Kubernetes, Pivotal, those pieces coming together, and to this audience Project Pacific, right, it's just like okay, wow, everyone of them will become Kubernetes enabled. 20,000 selfies with Joe Beda, right, have now been ushered because it is that game changing, we believe. This is the biggest free architecture of the Core platform in a decade, so. >> My favorite quote from you was if you're not out on that next wave, you're driftwood. You said that on the QA, I forget which year it was. >> And mine's security's the do over. (Pat laughs) >> You're doing it over, you're doing it, Mr. Gelsinger. >> Next 10 years, what's the big wave everyone should be on? What's the wave that you identify? You've seen many waves, you've created waves, you've been part of waves. What's the wave for the next 10 years that people should pay attention to, that they need to be on? >> Well, if they're not on the networking wave, get on it, right? They got to be on this multicloud hybrid wave. Could it be louder? The Kubernetes one is the one, right? That's the one I'm going to put at the front of the list. And this move in security, I am just passionate about this, and as I've said to my team, if this is the last thing I do in my career is I want to change security. We just not are satisfying our customers. They shouldn't put more stuff on our platforms if they can't-- >> John: National defense issues, huge problems. >> It was just terrible. And I said if it kills me, right, I'm going to get this done. And they says, "It might kill you, Pat." >> Mount Kilimanjaro right there. Pat, thank you for all your commentary, and great look back 10 years. You've been one of our favorite guests coming on theCUBE, bringing A game, you're bringing the tech chops, the historian aspect, also you're running one of the most valuable open source companies in the cloud. (Pat and John laugh) >> Love you guys, thanks so much. >> Thanks, Pat. Pat Gelsinger here inside theCUBE. Our 10th year, VM's looking good off the tee right now, middle of the fairway, as they say, for the next 10 years. I'm John Furrier, Dave Vallante, thanks for watching. (upbeat music)

(funky music) >> Announcer: Live from San Francisco celebrating 10 years of high tech coverage it's "theCUBE" covering Vmworld 2019 brought to you by VMware and its ecosystem partners >> John: Hey welcome back everyone its "theCUBE" live coverage here of VMworld 2019. We're in Moscone North in San Francisco, California. I'm John Furrier, Dave Vellante. Our tenth year covering VMworlds. The last show that's still around since "theCUBE" started. EMC World's now a part of Dell Technology World so VMworld was our first show of "theCUBE" in 2010 and we're here with then the Senior Director now the CMO of VMware Robin Matlock. Great to have you. Thanks for coming. 10 years ago we were across the street at the South. The first ever "CUBE", now 10 years later, what a run. Thanks for coming on. Appreciate it. >> Robin: Well how 'about the fact that this is number 11 VMworld for me so I think we're on, like, number 16 or so for VMworld so, yeah, we've driving been this ship for a while and it's still going strong. >> John: And, you know, when you came in the studio we did a little preview video and one of the things we talked about and you jumped on was this notion of resiliency around VMware. I want to get into that because the keynote this year I thought really used some of his primetime real estate to highlight Tech for Good and really some of the efforts around that so 1. Shareholder value, you guys have been doing great. Stock prices up. But in this era of, you know, corporate responsibility and accountability, this Tech for Good message is real. You guys have been doing it for a while. It's not new, it's not like you're doing it for fashion, it's the real deal and it was a big part of the keynote. >> Robin: It was. In fact, it was really a highlight for part of the keynote for me personally. I mean, I think when it's in our DNA, and that is consistent with our values, and we've been at that for some time. We have values that are all about, you know, customer and community and that's who we are. We also have very high aspirations that of course we have to be performant. We have to perform well as a business and deliver shareholder value but that isn't enough. You know, I do think that Pat leads this narrative that we as a company have to think about giving back more than we take. And it's not just PowerPoint slides, it's real. We empower our employees. I hope you enjoyed the story about Callum Eade swimming the English Channel all for a cause that he chose. He raised the money, he drove that and VMware just opens up those opportunities to allow our employees to do that so I think, we think it's a really important topic, we tried to give it a lot of air time, and give a way for the attendees to connect with it and see what they could take action against. >> John: And also, you guys are also voted one of the best places to work. Your campus in Palo Alto, beautiful and it is a great place to work. But this is the ethos, but it's still competitive and had Carl Eschenbach recently in our studios in Palo Alto and he made a comment he's like, "You know, I've been at VMware "for many, many years", now he's a VC at Sequoia Capital, and Carl said, "You know, everyone's been "trying to kill VMware. This is going to VMware, "that's going to kill virtuals." The resiliency just around the staying power of the product and technology leadership happens. This year it's containers, the attendees are excited by it, the numbers are up, 20,000 people here. Still evolution on the technology side, still great community. >> Robin: Yeah, I mean I think, you know resiliency is in the fabric of VMware but I think innovation is what is the secret sauce and we know in Silicon Valley you better innovate and keep moving forward or you're going to find yourself kind of, left out and, you know, Pat's been an incredible visionary. He's got a team of leaders that are very confident, strong technological disrupters. I mean some of the big acquisitions that we announced just last Thursday at earnings that we are educating folks here about, the intent to acquire Pivotal, the intent to acquire Carbon Black, you know, further that we'll either do it organically or we will acquire interesting combinations of companies to drive unique value to our customers. So I think there was a whole bunch of that today. >> Dave: We were talking in "theCUBE" earlier, Robin, about how now it's a post-virtual machine world and if we go back to 2009, which was my first VMworld as well, Paul Maritz at the time said we're building this software mainframe. Now, of course, you got promoted and I'm sure killed that mainframe from all marketing but (laughs) so well done but you kind of evolved the software-defined data center vision. But one of the takeaways for me from the keynote was this notion of any workload, any app , which was kind of the vision back then and now in a cloud which the cloud wasn't as prominent then. And so from a marketing standpoint you've really, the vision has been consistent but now with all these acquisitions you're making you're really embracing a much broader vision and your marketing message has to evolve as well. >> Robin: To support that, I think the fact that our vision has been incredibly consistent for many years now, I mean, that's Pat's leadership kind of setting that foundation for the company. My job as a marketer is to help find the way to articulate that in a way that's consumable and people understand. But what's happened over the years is we deliver on that vision 'cause, you know, a vision it's not all perfect, we don't have every piece of it or it's not all optimized. All of these moves year after year are just validating and supporting the delivery of that vision to our customers and I think the big moves this year are no different, whether it's Tanzu for Kubernetes, whether it's the Carbon Black acquisition idea, whether it's Pivotal, these are just steps along a journey that's going to deliver on our vision which is delivering any application on any cloud consumed by any device, all with security intrinsically built in the fabric. >> Dave: Well and the gauntlet that you lay down this year in talking to your practitioner audience was that technologists who master multi-cloud will own the next decade. Okay. That kind of says it all, right? And that is a strong message that you're sending to your buyers, to your practitioners so. >> Robin: Yeah, and I think the people that are right here at VMworld, these are the kinds of technologists that have that opportunity in front of them. That's why this whole notion of make your mark it's like, lean into this opportunity. Betting on VMware, building your career on virtualization has opened up many opportunities. It went from compute to storage to networking. It's now into multi-cloud. These are incredible opportunities and these technologists are the ones that can deliver this value for their enterprises. >> Dave: And there's diversity in the messages, you know, all the major cloud players say, "Well no. Just our cloud." You guys are pushing in a new direction. I mean that's what leaders are supposed to do, right? >> Robin: Our strategy has always been about choice, you know, we've really been advocates of letting customers choose the path that's right for them and we know in this cloud war that we're all a part of that customers they are choosing. Some are leaning into AWS, some are leaning into Azure, some are biased towards IBM. Our job is really to enable them to have a rich, powerful experience without friction, efficiently, and operate those workloads in any of those environments. >> John: Have you seen any demographic shift in your primary audience because obviously the operating side, even with Kubernetes, they love it, containers, a messaging channel that's in and of itself but still containers seems to be that next step function with Kubernetes that VM's brought to computing. But when you bring in the dev and the ops that's where it starts to get magical when the operating's got to meet up with the developers. That's been the theme. cloud-Native. All this enablement's coming in. Has there been a shift in demographics to your audience? >> Robin: Well it is an evolving journey, if you will, and yes but it's still, I think we have a long ways to go. We are largely still have an infrastructure audience here, there's a mobility crowd here, there's a cloud architect crowd here. The new audiences are going to be the platform architects that dev/ops community and we do have shifts in that but I would say that's part of the value as we bring Pivotal into the family, we can now merge these audiences and, I think, do a much formidable job at that. >> John: It's interesting, Telco will have them on later. 5G was a big part of the keynote as well >> Robin: Yeah. >> John: A new opportunity, a new affinity group there. >> Robin: Without a doubt, I mean, the whole Edge and Telco clouds are really opening up new entirely new markets. The Telco, the 5G, we do think that's going to be a very significant wave and is going to create new opportunity for new application types, new fundamental architectures that we can now merge between Telco and Enterprise so we think it's really a rich ground for innovation. >> John: You mentioned Pivotal, I think that's more of they were already in the fold, now they're officially in the fold with Dell Technologies but your other acquisitions, there's a lot of them. You got to kind of bring them into the fold so is there the marketing playbook do you have an off-site meeting and you just give them the playbook? How do you handle all the integrations? 'Cause that's always a big challenge. IT integration, messaging integration, again it helps if they're on the fault line of the value proposition but >> Yeah. >> John: What's your strategy to integrate all these companies? >> Robin: Well, you know, any time you're doing a lot of mergers and acquisitions you definitely have to think very strategically about integration and then sometimes you want to integrate fully, right away and sometimes you want to let an acquired company be stand-alone for a little while. Got to get used to the culture a bit-- >> John: Like Velocloud? >> Robin: Velocloud is kind of independent-- >> John: They've got their own building. >> Robin: within the networking team. AirWatch was held very independent for a couple of years. Some other ones are just tuck-ins. You just bring 'em right into the family, you just merge 'em in, it just depends on the size, the scope, the culture and the strategy. I think we take a very purposeful approach to M&A integration and we don't really have a one-size-fits-all strategy. Depends on the circumstances. >> Dave: So follow up on that because clearly there's an engineering culture here at VMware and take the Carbon Black example for instance you talked about how you guys have sort of pretested it with AppDefense but from your standpoint, how do you think about the architecture of the marketing and the messaging? I think you answered it in part. It was sometimes it makes sense to keep it separate sometimes but when you think about the vision do you look at it and say, "Okay this plugs nicely into the vision "and so here's what I'm going to do?" How integrated is it with the rest of the sort of decision-making process? >> Robin: Well, you know, I would take the position that all these acquisitions are plugging into the vision. They are that's why we're buying them because they are very aligned to our strategy and vision. Now I have the challenge as a marketer to deal with a lot of different brands that are coming into the family. I mean, how and when do I consolidate and kind of unite the brands and that is a journey that we're going to be on. We'll take some time to do that. You don't want to rush things in that regard. I think it's very important that the market sees one VMware, one vision and strategy, you know, if it's delivered in a product and it's through an acquisition as a different brand that's okay, we can work on that over time but as long as we're laying out one strategy and vision to the marketplace and just showing these are evidence of proof points of that journey. >> John: Yeah. I mean, you guys, you're pretty clear. Your strategy is to evaluate, understand where they are in the value chain of what you're trying to do. Unlike others like IBM which brings companies in quickly, makes them IBM, you guys are a little bit different, You'll play with whatever the market will give you. That's pretty much what I hear you're saying. >> Robin: Well for example, Carbon Black, experts in security, you know. I think we want to capitalize on that expertise. We want to protect that expertise. They've already been partnering with AppDefense now for some period of time rather than, you know, it's like which one is >> Right. >> Robin: consuming the other (laughing) so our strategy is let's combine AppDefense with Carbon Black and then start working with Patrick and Carbon Black to merge that into the-- >> Yeah. >> Dave: Organizationally, I think that's, at least what I read >> Yeah. >> Dave: was you can set up essentially a cloud security division, right, that Patrick is going to >> That Patrick is going to run. >> Dave: run, so >> That's right. >> John: Okay so VMworld 2019, what's the update here? Give us some factoids, some of the exciting things happening here. We're in the meadow, there's birds chirping here. This is Moscone North, nice build-out, always good build-outs here. Moscone, we're back in from Vegas but what's going on? Labs, activities-- >> Robin: We've got it >> Give the-- >> Robin: all, John >> Give us the highlights. >> Dave: Klingons >> That's right. >> Robin: First of all you've got two great days of keynotes, right, those are really important highlights. Tomorrow we're going to do some really interesting things, demo, technical, deep dive. Great guest celebrity speakers, right, We're going with the sports theme this year and elite athletes and what they're giving back to the world with Lindsey Vonn and Steve Young. But here for the program we have the Hands-On Labs are on fire. They broke records on Sunday so I know they've been really well-attended and consumed. We have over 600 break-outs, so many it's mind-boggling. We have 230 sponsors in the Solutions Exchange and that's probably a place where you can go not just to get the VMware stuff but get that good exposure and lay of the land of the entire ecosystem. And they're all showcasing their innovation. What's new, what's the latest. So I think those give people a really good quick snapshot in one week, you can pretty much get an overview of the entire industry. >> John: Are there any must-sees in your opinion? >> Robin: (breathing in) Oh-- >> John: Or that people are talking about? >> Robin: I think for sure you got to get into this Kubernetes stuff. If you don't come out of this week of VMworld with a good handle on what is Tanzu, what's Tanzu Mission Control, what are we doing with the Heptio acquisition, what is PKS evolution happening, I think you would be missing something if you don't really grok that. Project Pacific work, Kubernetes in vSphere, tightly integrated, so that's a must-do. I think there's a lot happening in the networking space, right. Pat was pretty bold up there about, you know, what is the opportunity relative to network virtualization and the time is now so I think you've really got to get into that from the data center to the Edge to the cloud. Network transformation's hot. And then of course I think the cloud and I think we're really clear on hybrid-cloud and multi-cloud and how to really think about those environments and how, if you're architecting cloud for your company, what you want to be thinking about, what are we doing across multi-cloud, and, you know, I think all that hybrid-cloud stuff, it's all there. >> Dave: As we move to this, you know, this post-VMworld, VMware world how do you-- >> Robin: Is there a post-VMware world? >> Dave: What role, post-virtual-- >> John: Oh look at that, there we go. (laughing) >> Robin: I don't think there's a post-VMware world. >> Dave: Post-VM. I mean virtual machines. >> Robin: Virtualization. >> John: Are you changing the name to container world? >> Robin: No. (laughing) >> Dave: Right, exactly. So what (laughing) yeah what specifically are you guys doing to sort of educate folks, I mean, obviously you've got a lot of Kubernetes sessions, et cetera but just in terms of helping people sort of transform their skill sets into infrastructures of code, being able to take advantage of Kubernetes, you know, we've seen some things in the industry at events like this where you know, guys learn how to program in Python or, you know, whatever it is >> Right. >> Dave: Are there specific plans to do that? Is that actually happening at the event or? >> Robin: Well that's part of what all this content is about, I mean, you know, 600 break-out sessions aren't about, you know, compute virtualization. You can find those but this is about all these different dimensions, right? Whether it's what is Kubernetes, fundamentals, how you think about that in what kind of environment you're running. And I think that's the spirit of what VMworld is about. It's about hands-on, it's about meet the experts, it's about sessions, it's about the ecosystem, it's about having that all at your disposal in one week. >> You forgot something. >> Oh did I? >> The parties. >> The party? >> Everyone >> Well that's not helping your technical-- >> Everyone >> Aptitude >> Everyone knows VMworld has great parties at night and that's where all the action, you guys work hard/play hard one of the ethos of VMware culture. >> Robin: That's right, that's right. Well, we do work hard/play hard because this is intense, right? These guys are trying to jam as much as they can into four days and so we got to let off a little steam and OneRepublic is on stage on Wednesday night. We're going to have a great time. But I do think it's on the back drop of them here they are just like sponges trying to absorb this information. >> John: My final question is, and you guys brought it up in the keynote, around the tech industry good, bad, and Pat says neutral, it's how you shape the technology. Really a call to action and a strategic imperative to be more proactive in accountability and driving change for good. So I got to ask you about the word trust. I've seen a lot of marketing around companies always try to market around trust. Now more than ever the trust, whether it's fake news, company responsibility to security, which is a big part of what you guys do. How do you see that a marketer and what's the conscience of VMware because trust is certainly a big part of what you guys do. Is that a marketing, going to be a marketing ethos? Is it built into everything? Just curious how you personally feel about the word trust. >> Robin: Yeah, well first of all, I think it's foundational to doing good, healthy business. I think you got to be very careful as a marketer to market trust. I think you need to demonstrate your trustworthiness. You need to be consistent. You need to be credible. You need to be there when the times are tough. You need to be, you know, not always asking for something in return and if you earn trust you don't really have to say it. I believe we can position our validity and our credibility proven, you know, having customers say that we're trustworthy, having customers articulate >> Yeah >> Robin: why they depend on us, I believe that's more effective for our customers and, at the end of the day, probably more authentic. >> John: Yeah, and I think people, yeah that tends to be the track record of people who say it maybe haven't earned it, right, earning it's the better marketing strategy-- Yeah, I think these 20,000 (laughing) people are saying it as they show up here with their time and energy and investment. And I think our customers, you heard from a lot of customers on stage today. Gap, Freddie Mac, Verizon, there'll be more tomorrow. You know, I think there's over 100 customers in these sessions here and they're here advocating because they trust VMware. >> John: Well they run their business on you guys. Dave had a survey hey did, just published it yesterday, the spend is not going down. I mean the cloud impacts your business, you're getting into the cloud so that's pretty obvious but just overall the business is healthy >> Oh very >> John: for VMware (laughing) >> Robin: Very healthy. And you know we do that by really trying to have a balanced approach. It is about shareholder value but it's about tech as a force for good, we're passionate about that and ultimately we put customers at the center of our thinking, of our decisions, of our behaviors, and I think that ultimately keeps rewarding us. >> John: Well, Robin, it's been great to work with you over the past 10 years. Continue on. I think you guys have earned the trust, certainly the proof is in the results, and, you know, it is what it is, and the community votes with their wallet on the product and their participation so congratulations. >> Robin: Well if that's an indicator, I think we're getting a pretty good report card. >> John: Thanks, yeah. (laughing) >> Thanks for inviting me. Love being here, guys. Take care. >> John: Alright, Robin Matlock, CMO of VMware here inside "theCUBE" for our 10th year but also as VMware goes to the next level step function with virtualization to containers, Kubernetes, big theme here, I'm John with Dave Vallente, stay with us for more coverage after this short break. (funky music)

>> Announcer: Live from San Francisco, celebrating 10 years of high tech coverage, it's theCUBE! Covering VMworld 2019. Brought to you by VMware and its ecosystem partners. >> Welcome back, I'm Stu Miniman with my co-host, Justin Warren, and this is theCUBE, live from the lobby of Moscone North here in San Francisco. The 10th year we've had theCUBE and happy to bring back two CUBE alums. Which, of course, in 2010 we didn't even have the idea of a CUBE alum, we were just gathering some friends, some industry experts. To my right is Jaspreet Singh, who's the founder and CEO of Druva. Sitting next to him is Kit Colbert, who's the Vice President CTO of the Cloud Platform Business Unit at VMware. Gentleman, thanks so much for joining us. >> Good morning. >> Thanks for having us. >> All right, so Jaspreet, I remember talking to you when Druva was a new company and cloud native wasn't the thing that came to mind when we were talking about it. We've known for a long time how important data is, and protecting that and managing that, of course, is something the industry's been looking at a long time. But give us the update on kind of Druva and you brought along Kit, so we're going to be talking about some of the cool, cloud native multi-cloud modernization type things, how that fits in your world. >> Absolutely. If you think about the world, right? In 1998, say for a start, they would create a whole notion of size and no software and the whole picture, right? Since then applications went in size, then came developer tools which were in size, and now it's all about infrastructure and first your management which is getting to be a cloud native, public cloud orientated size world. To where Druva comes in. As the world gets more and more fragmented, the data gets more and more fragmented. The multiple versions of cloud are different parts of strategy. Data management has to get more and more centralized. Which is where Druva comes in and which is where me and Kit are together. I think as VMware build a strategy for multi-cloud. Pulling the whole VMC approach to multiple versions of public cloud. Druva is a great partner, to sort of bring the data management together. A single control plane to manage multiple versions of cloud deployment on a single plane. >> All right, great so Kit it sounds like VMC is the kind of key component work together. 'cause when I think at Druva, a lot of what I think of is SaaS. And SaaS isn't necessarily the first thing that I think of when I think of VMware, so... >> We're tryin' to get there, tryin' to get there Stu. >> Yeah, no but pull it together as to where your customers intersect. >> Yeah absolutely, so it's a great partnership and definitely really focused on rallying around VMware Cloud and native AWS. And the core idea there was that we could deliver a cloud service to our customers of our VMware infrastructure, right? And we'll become a SaaS company, transforming into that. And that's something that we've been very focused on strategically, right? And so VMware Cloud and AWS is really the first offering. But there's many more coming. So just earlier today we announced the availability of VMware Cloud on Dell EMC. This idea of bringing our cloud service, STDC as a service on premises, to customer data centers, to customer edge locations. And the cool part about it, as Jaspreet mentioned, is that this world is becoming more and more distributed and we're seeing that with just the number of STDCs and how they're proliferating everywhere and you do need that centralization in terms, from a management perspective in order to handle all that diversity. And so, that's the big focus for us, in terms of the infrastructure, kind of just the core compute, source, network but you then have to up-level and say, how do you think about the data? And that's really where this partnership comes in. >> Right, so Jaspreet so if I understand that correctly, what you're trying to do here is to provide one data management method, no matter where the data lives. So, I don't have to go and find one tiny thing for, oh okay, I've got this other weird bit in the corner here, that I need a special, dedicated data protection thing for, 'cause that's always difficult. Data protection is hard enough. I really don't need to have, oh how am I going to deal out of this particular thing? Oh, now I've got to go and get another tool. And learn how to use it, maintain it, keep everyone skilled in it. Well actually, I can just pick Druva and then I've solved that problem. >> That's right. I think we are more forward-looking, than backward-looking. So, what we're doing is, any new application comes into an enterprise. Think about, from a point of view of a new cloud, like a VMC, AWS deployment. If you're deploying, you know, a lot of new edge location or data centers or new cloud services, Druva's a perfect partner to bring data management, along with it. For a legacy application that you always had, you can keep your legacy vendor with you. Where it has a con wall, you can keep them as they remain in your enterprise. Bring Druva for the new applications at hence. All the new workload that are more cloud bound workload, is our core focus, hence the VMC partnership. >> Right, so does that mean I'll be able to use Druva wherever VMC is available? >> That's right. >> Yeah. >> Because you're expanding how many places I can get VMC now, I've noticed. >> Yeah, very exciting. >> That's very interesting >> It is, yeah, and I think that's again, the beauty of the partnership, is that we're doing a ton of work to deliver VMC to more and more locations. We've partnered with AWS, and now we've got global coverage, almost all the regions by the end of this calendar year. And now with VMware Cloud on Dell EMC , we can go wherever the customer is. They essentially give us a street address, and we can deliver hardware there and then operate it remotely and they can take advantage of that. And the cool thing about it, that all comes up to this control plan that we have running in the cloud and this is how we can interact with Druva. They can have a few simple APIs they can manage via us to access all those workloads that are distributed all over the place. >> Think of public cloud. Public cloud is nothing but Amazon's, initially was a concept of Amazon applying retail to IT. You can buy a resource anywhere in the globe at a fixed price point at certain SLA. That's the promise of, public cloud promise of VMC to get same VMware experience wherever you go across the world same price point. Same promise with Druva . The same data you put anywhere, can be managed, predicted end-to-end, same policy, same price point across the globe. >> And people often forget that part of it, that we're technologists. So people like to look at that the speeds and feeds and what does the technology do but there's, when you're running a business is actually a lot more to it and pricing models and things that technologists sometimes find boring. I love a good spreadsheet but something as, a simple pricing model where I can understand it and I know what it's going to do for me, was when I spin up a brand new application and I understand how am I going to manage this over the long term, how am I going to protect it, and what's it going to do for the the ROI on that? And what's that going to look like in three years' time? Not just turning up the brand new project. What is the operational cost of that going to look like? These are the kinds of things that people, I think are starting to get a lot more used to now that they particularly with cloud it's a much more operational model. It's not a build model. It's, yes build is one part of it, but you also need to be able to run and manage it >> And think of what we call the world of two ransomwares. There is a ransomware when you're worried about a data breach or data loss and there's another ransomware we have to, your data production vendor or your hardware vendors say is, you know, give me five years of money up front with the promise to manage the data eventually. So in the public cloud world, it's pay-as-you-go on demand. You need a new application you spin up a new workload in VMC in AWS. You need data protection spin up right there and then, no pre-planning, pre-positioning, architecture reviews needed. >> And I think like, the great thing about Druva and what we're talking about here in this consistency of operations. How you're managing data, really goes into the whole strategy that VMware has around driving consistency across infrastructure as well. I think one of the big value propositions that we can help with is taking a lot of this very heterogeneous infrastructure with different capabilities, different hardware form factors and layering on our virtual infrastructure which simplifies a lot of that and delivering that consistent experience. And of course data management as we said is a key part of that experience. >> Yeah, you mentioned kind of the move of VMware towards being more of a SaaS player and working in those environments. One of the flags along that journey is VMware's always had a robust ecosystem. But in the cloud my understanding is you've released now a VMware Cloud Marketplace. Reminds me a little bit of a certain cloud provider that has a very well-known marketplace. Give us a little bit about it, and Jaspreet'll, of course tell us about the Druva piece of that. >> Yeah, absolutely. We're kind of really evolving our strategic aims. Historically we've looked at how do we really virtualize an entire data center? This concept of the software-defined data center. Really automating all that and driving great speed efficiency increases. And now as we've been talking about, we're in this world where you kind of have STDCs everywhere. On Prem, in the cloud, different public clouds. And so how do you really manage across all those? These are things we've been talking about. So the cloud marketplace fits into that whole concept in the sense that now we can give people one place to go to get easy access to both software and solutions from our partners as well as open source solutions, and these are things that come from the Bitnami acquisition that we recently did. So, the idea here is that we cannot make it super simple for customers to become aware of the different solutions to draw those consistent operations that exists on top of our platform and with our partners and then make it really easy for them to consume those as well >> And Druva's part of it. We were day one launch partner on the marketplace. Marketplace serves predominantly two purposes. One is, the ease of E-commerce, you can drive through a marketplace. Second, is the ease of integration. You have a prepackaged solution, which comes along with it. It's a whole beauty of cloud, exactly as I mentioned. We see cloud beyond technology. It's an E-commerce model most companies should adapt to. And as the part of the progress, our commitment is to be in marketplace day one. Druva is right now number one ISP globabally for AWS. So we understand the whole landscape of how E-commerce gets done on public cloud very very well, and we are super thrilled to be a partnership with VMC on the marketplace, the VMC Marketplace. >> It's another one of those important indicators. I think about VMware's Cloud journey. Cloud isn't a destination, it's not a location. It's a way of doing things-- >> Kit: It's a model, yep. >> So having this this marketplace way of consuming software and becoming far more like as you say, it's STDC, but with that software as a service on Earth. You can have STDC as a service. That's probably too many letters in that. >> We use that internally, yes the STDC, AAS (laughs). >> Seeing those features coming to VMware and the partners that you bring in to that ecosystem. And Stu and I we spoke before, it's like VMware is always been a great partner for everyone in that ecosystem and it does have a real ecosystem and we see it again this year at the show. That you have these partners who come in, and you're finding ways to make it easier for those integrations to happen in a nice, easy to consume way and customers like that. So the enterprise is a heterogeneous environment. If you just do one acquisition and all of a sudden, I've got two different ways of doing the same thing. So being able to have known trusted solutions to do that, where I don't have to spend ages and ages figuring out how to, how do I configure this? I don't actually make this do what I need it to do. It's like I'm trying to solve a customer problem. I'm not trying to build technology for its own sake for most of the customers. I just want something that works, and particular with data protection, I just want it to work. >> The owners aren't producing more back abutments. >> No, which, I don't think it should. it's kind of a shame. I used to be a back out man but we don't need anymore of those >> I think this is the idea. You talked in the beginning about this notion of service delivery and how can we take all these STDC's that we have out there that customers are running, and enhance their value and enhance the value to the customer's business by adding on these value-added services. So, I think that's one of the beauties of cloud marketplace is that they can very easily extend what they, customers can extend what they already have with these additional services. >> Jaspreet, VMware's been going through a lot of change. They've made acquisitions. I saw a number of announcements today, that I don't think I would have seen back in the EMC days of you know, some of the data protection solutions being baked into the platform. Tell us what it means to be a VMware partner today. >> I think it's great to see VMware innovating and making strong progress. I think in this world of constant change it can either be in the front end of, you can never never over-innovate. You can be in the front end of, being in the edge, driving change, driving Innovation, driving chain industry or taking a back seat and then be in HPE. So I think I love to see VMware what they're doing and making all the progress and great to be a partner in this change, in this journey to see as a strong partner. >> Yeah, I mean, we're not standing still and it's funny like. So one of the biggest announcements today in my mind is Project Pacific, this re-architecture of vSphere to building Kubernetes into the fabric of what vSphere is. And it's funny when you start looking at that because I think folks have a concept in their mind, of what vSphere is, right? It's VM-based and I have worked with it in certain ways. It's got a certain API or interface and we're fundamentally changing all that. We're rethinking, as I mentioned how we deliver our STDC's, our customers consume them. And so I think that notion of being at the forefront, we're very committed to that >> Kit, I'm glad you broke it up 'cause I'm still having a little trouble thinking through it. Now on the one hand, every company is going through this, we're going to containerize everything, we're going to make it microservices, every infrastructure component, now has that fundamental building block. Docker had a ripple effect on what happens, similar to what VMware had a decade before. But I look at Project Pacific and I'm like well, when Cloud Foundry was originally created, it was, we want back then we called it Paz, but I want a thin layer, and I don't want to pull VMware along for that necessarily. It might fit underneath it, but it might not. So help us understand as to like, how is this not like, a lock into what, you're going to use vSphere and you're going to have your license agreement with us every year and now you're going to be locked into this because this is your Kubernetes platform. >> Yeah, that's a good question. So look, I actually think it drives more openness because Kubernetes is an open platform and we're integrating that in, and we're leveraging the Kubernetes API. And so, the vSphere will have two northbound APIs, one of which is based on the existing VM-based one and the other one which is Kubernetes. And so partially, it's we're actually opening it up. The cool thing about what we can do with Pacific is that we have what, 300, 400000 customers running vSphere. They have an aggregate around 70 million workloads. We're able to take that massive footprint and move it forward almost overnight by building Kubernetes into vSphere. And so the way I look at it, is this is a huge force multiplier for our customers, this ability to move their fleet of applications forward at basically, zero cost, very little cost. And while leveraging all the tools and technologies, they already have. This is another good thing, that our partnership with Druva as well, is that because the way we've architected this, all the tools that use vSphere today and the vSphere's APIs, those APIs will see the Kubernetes pods and things that are provisioned and those tools can operate on those pods just like they can on VMs. And those things just work out of the box. So like if a customer gets specific and uses Druva, and they start provisioning some pods, into Kubernetes on vSphere, Druva will see those they can manage the data, it's all automatic. And of course, Druva can do extra cool things, like even get deeper integration there. But the point is that we've got, you know thousands of partners again who's out of the box that stuff will work. Now is that lock in? No, I actually think that because people are switching over to Kubernetes, they now have the ability to move that to a different Kubernetes environment if they so see fit. Anyway, so that's my quick answer >> Think about the world. Virtualization is practically free right now. What you pay for is the enterprise, once you pay for abstraction level, remove complexity, make my scale happen, and this is where you pay for the whole VMware stack. When the customer start deploying containers, they haven't seen the complexity they would see at scale. When you see the complexity in management and data plane and insecurity plane, then they would need the ecosystem of providers to solve those complexities at scale but as we're a think if Kubernetes takes off and production application, right now it's mostly dev and test, it goes to a production application, the world would need something which is a much more robust sort of control planes to manage it end-to-end >> Yeah, I mean, we solved a lot of the hard problems around running applications in production. And I think what we're doing with Pacific, is enabling all those cool innovations to work not just for existing apps but for new Kubernetes-based apps as well. >> All right, well Kit and Jaspreet, thank you so much. A lot of new things for everybody to dig into and I always appreciate both of you and your teams are very responsive and dig in. Be looking forward to more blog posts and more podcasts from your team and the like, to go into it more. For Justin Warren, I'm Stu Miniman. We have tons more coverage here at VMworld 2019. Thank you so much for watching theCUBE. (upbeat music)

(upbeat instrumental music) >> From our studios in the heart of Silicon Valley, Palo Alto, California. This is a CUBE Conversation. >> Hey, welcome back everybody. Jeff Frick here with theCUBE. We're in our Palo Alto studios for a CUBE Conversation. It's just a couple of days until RSA kicks off a huge security conference. I think the biggest security conference in the industry. And we've got a security expert here in the house and we're excited to have him stop by. It's Manish Gupta, the Founder and CEO of ShipLeft. Manish, great to see you. >> Yeah, great to see you too, thank you. >> Welcome. So you must be really busy getting everything buttoned up for next week. >> Oh yeah, absolutely ready to go. >> Alright so for the people that aren't familiar with ShiftLeft, give us kind of the basic overview. >> Yeah of course. So ShiftLeft about a two and a half year old company. We started with the problem of you know, the software's driving innovation all around us, right? I mean, we see it in autonomous cars, IoTs, increasingly SwaaS software in the cloud. And all of the software needs to be figured out, how are we going to protect it. And so it's a big problem, and we've been working on it for about two and a half years now. Raised our Series A and most recently in the last two weeks, we announced our Series B of 20 Million. >> Congratulations. >> Amazing team, yeah! >> So, you've been in the security space for a long time. >> Correct. >> And RSA's a giant conference. I don't know what the numbers will be this year. I'm sure it'll be north of 40 thousand people. Moscone North, South and West will be full. Every hotel is full. But it kind of begs a question, like, haven't we got some of the security thing figured out? It's just a never-ending kind of startup opportunities as there's new ways to approach this kind of fundamental problem which is, how do we keep the bad guys out. How do we keep them from doing bad things while the surface area expands exponentially. The attack surface expands. And we hear every day that people are getting breached and breached and breached. So the whole ecosystem, and kind of approach has completely changed over the time that you've been involved in this business. >> Indeed, as you said, I've been in cybersecurity for a long time. I like to say the last 15 years, first part of my career, I was focused on detecting viruses. Then it became worms. Then most recently at FireEye, we were detecting advanced malware nation-state attacks like APT1s and APT3s. But it was then that sort of, it dawned on me that, look about 80% of security money gets spent on detecting bad stuff, right? And that's reactive. Essentially what that means is we are letting the bad guy shoot first and then we are trying to figure out, okay what are we going to do now. >> We're waiting like 150 days right, down from 230 days, before we even-- >> Exactly. >> know that he's shootin' at us. >> That's right. Now couple that with as you said, the attack surface is ever increasing, right. Because we're using software in every which way which means all of this stuff needs to be protected. And so that's why we were wanted to start with a fresh perspective which is to say, let's not worry about attacks. Because that is not in our control. That's in the bad guys' control. What can we control? Which is our software. And so, that is why what we do at ShiftLeft is to understand the software very quickly, extract its attack surface in minutes, and then allow you to fix whatever you want to, whatever you can during the time frame you have available. And here comes the next innovation which is, if you don't fix anything, which is almost always the case, we will protect the application in production. Now the key is, we protect the application in production against its vulnerabilities. So we never ever react to threats. We don't care. >> So you have like a wrapper around the known vulnerabilities within the code. Is that a good desciption? >> Yes, you could absolutely, that's a good way of thinking about it is you know, let's say a million lines of code. We find 10 vulnerabilities in it. So it's only in 10 specific instances of the application. Now we also know what vulnerabilities exist on line 100 and line 200 and so on. And with that knowledge, we can very precisely protect each vulnerability. >> It's a really interesting approach. You know, one of the things I find fascinating with security is it's kind of like insurance. >> Mm hmm. >> In theory, you could spend 110% of all your revenue budget >> Correct. >> on security, but you can't so you have to make trade off decisions. You have to make business value decisions and you have to prioritize. So this is a really different approach, that you're offering an option either to fix the known, and/or just to protect the known, so that there's some variability in the kind of the degree of investment that the customer wants to spend. >> You summed it up well, Jeff. I think the fundamental challenge with security has been that. Is that ya know, 15 years ago we've asked our customers to buy antivirus. Then we asked them to buy intrusion detection. Then we asked them to buy nation-state or malware protection. Now we're asking them to buy machine learning based mechanisms to detect more threats, right? And so the funnel is like this, right, but it never goes down to zero. And so tomorrow some other approach will come up to detect the 0.1% of the malware. And guess what? The sys-os really don't have a choice right? Because they have to protect their organization. So they have to buy that tool also. Now in this entire process, you never get better, right? Notice that you never get better. All you're doing is just reacting. And because a virus from 15 years ago theoretically could still come and attack you, you can't throw away that too either. Right, and so that is precisely why I'm so passionate about work we're doing at ShiftLeft is we will protect you from, in sort of in bad continuous improvement for the first time in security. Find the vulnerabilities, fix them. But if you can't fix them, we will protect you. >> Now, what about another kind of big shift in the way software is delivered, is everything is an API to someone else's software. And oftentimes there's many many components that are being pulled in from many many places that contribute to, but aren't software that I control personally. >> Correct. >> So how do you guys deal with those types of challenges? >> Great question, great question. And you know, the popular saying is we are becoming an API economy. >> Right, right. >> And what we exchange on our APIs is increasingly a lot of data. And you're right. If you think about historical approaches, we will now have to break open the API on a network, to find out what it contains. And for various reasons, super hard to do, lots of operational efficiencies, inefficiencies, excuse me. And this is again where the ShiftLeft approach is rather unique. See because we go down to the very foundation. It's hard work right, but we go down to the very foundation, what is the source code of the API. So we will understand, okay, well this is what you should be putting in the API, right? But then I see that a variable called Personally Identifiable Information is being put into that API. I can now tell you before this becomes a problem that'll embarrass you in the newspapers. I, we will tell you, hey look, you are writing PII to a third party API without encryption, right. So you get to fix the problem at the very root where it starts. >> So but, can you wrap the known vulnerability in a partner piece of software? >> Absolutely we can. >> As it interfaces with my software? >> Correct. So, there are two aspects to it right. The first is what are you putting into that API, right, that is completely in your control. >> Right. >> Right, we don't really need to understand the API for that matter. So that is one particular use case we can absolutely protect you there, right. The second is when the API, when integrated into your application, makes your application vulnerable. Right, so I'll give you an example. This happened to one our our customers. This is a 3,500 person technical, technology company based here in Santa Clara. They were using a third party API. Very popular one. That third party API in turn was using a Jackson databind library, just an open source library. Now, as a company when we decide to use that API, we don't really worry about, we don't have visibility into like what all is it hurting. >> Downstream. >> Exactly. >> And how many feeds are in that one particular one. >> That's right. And so this is the supply chain of software. Right? Multiple components are now being brought together very quickly to create the functionality that you want to deliver to your users, to your customers. But in this pace of execution, we need tools like ShiftLeft to tell us hey what are we hurting. And whatever we are hurting, how is that impacting the security of our application. >> Right, right. Pretty interesting stuff, you got another component of something that's really important today that wasn't necessarily when you started this adventure. And that's the open source play. >> Yes. >> So as I understand it, you guys started really from more of an open source play and then ShiftLeft grew out of kind of commercializing what was that open source project. I wonder if can explain a little bit more. >> Yeah, I would love to. So the foundation of what we do is a technology called Core Property Graph. So, this is an invention of our chief scientist, Dr. Fabian Yamaguchi, one of the foremost authorities in the world, in the area of understanding code, right. And so as part of his PhD thesis, he came up with this technology and decided to open source a tool called Joern. >> Joern. J-O-E-R-N. >> That's right. >> Not easy to figure out, Joern yes. (laughing) >> Exactly. And it's actually his friend's name so that's how he named it. >> Ah, is that right? >> So he open sourced it and several organizations around the world have since used it to find very hard to find vulnerabilities. Right so as an example, this is a IEEE paper where this technology was used by Fabian to find 18 zero-day vulnerabilities in the main line Linux code, right. So arguably one of the most complex pieces of code on the planet, 15 million lines of code. Arguably one of the most analyzed pieces of code on the planet. And as recently as 2015, he finds 18 zero-days. And no false positives. Every single vulnerabilty has been acknowledged and fixed by the Linux community. That's the power. And so we use that as the foundation. So you write that as open source but since then we've done a lot of incremental work on enhancing it to make it enterprise ready. And that is a product we offer. as call this Ocular. Where we give you, think about it as my best analogy, is just like Google Maps for your source code. >> Yeah, I think it's a good analogy and he goes through that in one of his videos kind of explaining the mapping. >> Correct. >> Of different layers of kind of visibility into how you should look at software code. >> Indeed. >> Yeah alright, well before we let ya go, you got some exciting things happening next week beyond just the regular activities at RSA. You guys have been invited to participate in a special activity. I wonder if you can share a little bit and give a plug and maybe we can send some fans up to, I dunno if it's going to be audience participation in the judging. >> Yes. >> Go ahead and let us know what you're doing. >> Thank you for giving me that opportunity. Yeah super, super excited about, so we've been selected as one of the top 10 finalists for the RSA Innovation Sandbox. As you mentioned in your opening, RSA is the biggest security trade show in the world. And so now this has become the most seminal way of highlighting innovative work being done in the security industry. So I get three minutes to pitch ShiftLeft in front of an audience of about 1,500 to 2,000 people. Really looking forward to that. >> Well I dunno if you can speed this up to only three minutes (laughing) but I'm sure you'll be able to nail it. >> I will try. >> Alright well Manish, thanks for taking a few minutes of your day and I'm sure we'll see you in San Francisco next week. >> Thank you very much, thank you. >> Alright, It's Manish, I'm Jeff. You're watching theCUBE. We're having a CUBE Conversation in our Palo Alto studios. Thanks for watchin' and we'll see ya next time. (upbeat music)

>> Live from San Francisco, it's theCUBE covering IBM Think 2019. Brought to you by IBM. >> Welcome back, we're here at Moscone North. You're watching theCUBE, the leader in live tech coverage. This is day four of our wall to wall coverage of IBM the Think. The second annual IBM Think, first year at Moscone. Dave Vellante here with Stu Miniman. Eric Herzog is here, he's the CMO of IBM Storage and Sam Werner is the VP of Offering Management for Storage Software at IBM. Guys welcome back to theCUBE. Always good to see ya both. >> Thanks >> Thank you. >> So we were joking yesterday and today, of course multi cloud, the clouds opened, it's been raining, it's been sunny today, so multi cloud is all the rage. Evidently you guys have done some work in multi cloud. Some research that you can share with us. >> Yeah, so couple things. First of all, the storage vision in multi cloud at IBM for years. We work with all the cloud providers including IBM cloud, but we work with Amazon and we work with Azure, we work with Google cloud and in fact our Spectrum Protect, modern data protection product, has about 350 small and medium cloud providers across the world that use it for the engine for their back up as a service. So we've been doing that for a long time, but I think what you're getting is, what we found in a survey multi cloud and I actually had had a panel yesterday and all three of my panelists, including Aetna, use a minimum of five different public cloud providers. So what we're seeing is hybrid is a subset of that, right? On and off, but even if someone is saying, I'm using cloud providers, they're using between five and 10, not counting software as a service because many of the people in the survey didn't realize software as a service is theoretically a type of cloud deployment, right? >> So that's obviously not just the big three or the big five, we're talking about a lot of small guys. Some of the guys maybe you could have used in your Spectrum Protect for back up, local cloud providers, right? And then add sas to that, you could probably double or triple it, right? >> Right, well we've have been very successful with sas providers so for example, one of people on the panel, a company called Follett, they're a privately held, in the mid close to a billion dollars, they provide services to universities and school districts and they have a software package for universities for the bookstores to manage the textbooks and another software as a service for school districts across the United States. They have 1,500 and it's all software service. No on prem licensing and that's an example. That's in my mind, that's a cloud deployment, right? >> Ginni talked Tuesday about chapter two how chapter one was kind of, I call it commodity cloud, but you know, apps that are customer facing, chapter two, a lot of chapter two anyways, is going to be about hybrid and multi cloud. I feel like to date it's largely been, not necessarily a purposeful strategy to go multi cloud, it's just we're multi vendor. Do you see customers actually starting to think about a multi cloud strategy? If so, what's behind that and then more specifically, what are you guys doing from a software stand point to support that? >> Yeah, so in the storage space where we are, we find customers are now trying to come up with a data management strategy in a multi cloud model, especially as they want to bring all their data together to come up with insights. So as they start wanting to build an AI strategy and extend what they're doing with analytics and try to figure out how to get value out of the data they're building a model that's able to consolidate the data, allow them to ingest it and then actually build out AI models that can gain insights from it. So for our software portfolio, we're working with the different types of service providers. We're working closely with all the big cloud providers and getting our software out there and giving our customers flexible ways to move and manage their data between the clouds and also have clear visibility into all the data so they can bring it together. >> You know, I wonder sort of what the catalyst is there? I wrote an article that's going up on SiliconANGLE later and I talked about how the first phase was kind of tire kicking of cloud and then when the down turn hit, people went from capex to opex. It was sort of a CFO mandate and then coming out of the down turn, the lines of business were like, whoa agility, I love this. So shadow IT and then IT sort of bought in and said, "we got to clean up this mess." and that seems to be why, at least one catalyst, for companies saying, "hey, we want a single data management strategy." Are you seeing that or is there more to it? >> Well I think first of all, we're absolutely seeing it and there's a lot of drivers behind it There's absolutely IT realizing they need to get control over this again. >> Governance, compliance, security, edix >> And think about all the new regulations. GDPR's had a huge impact. All a sudden, these IT organizations need to really track the data and be able to take action on it and now you have all these new roles in organizations, like data scientists who want to get their hands on data. How do you make sure that you have governance models around that data to ensure you're not handing them things like pi? So they realized very quickly that they need to have much better control. The other thing you've seen is, the rise of the vulnerabilities. You see much more public attacks on data. You've seen C level executives lose their jobs over this. So there's a lot more stress about how we're keeping all this data safe. >> You're right. Boards are gettin' flipped and it's a big, big risk these days >> Well the other thing you're seeing is legal issues. Canada, the data has to stay in Canada. So if you're multi national and you're a Japanese company, all your Canadian offices, the data has to be some cloud of ours got an office in Canada. So if you're a Japanese headquarter company, using NTT cloud, then you got to use IBM or Amazon or Azure, 'cause you have to have a data center inside the country just to have the cloud data. You also have shier maturity in the market. I would argue, the cloud used to be called the web and before it was the web, it was called the internet and so now that you're doing that, what happens in the bigger companies, procurement is involved, just the way they've been involved in storage servers and networking for a long time. Great you're using CISCO for the network. You did get a quote from HP or using IBM storage, but make sure you get at least one other quote so as that influences aside from definitely getting the control is when procurement get involved, everything goes out for RFP or RFQ or at ten dure, as they say in Europe and you have to have multiple vendors and you sometimes may end up for purely, we need the way to club 'em on price so we need IBM cloud and Microsoft so we can keep 'em honest. So when everyone rushed the cloud, they didn't necessarily do that, but now that it's maturing >> Yeah, it's a sign of maturity. >> It's a sign of maturity that people want to control pricing. >> Alright, so one of the other big themes we've been talking a lot about this week is AI. So Eric talks about, when we roll back the clock, I think back to the storage world, we've been talking about intelligence in storage for longer than my career. So Sam, maybe you can tell us what's different about AI in storage than the intelligence we've been talking and what's the latest about how AI fits into the portfolio? >> Yeah, that's a great question and actually a lot of times we talk about AI and how storage is really important to make the data available for AI, but we're also embedding AI in our storage products. If you think about it, if you have a problem with your storage product, you don't just take down one application. You can take down an entire company, so you've got to make sure your storage is really resilient. So we're building AI in that can actually predict failures before they happen so that our storage never takes any outages or has any down time. We can also predict by looking at behavior out in the network, we can predict or identify issues that a host might be causing on the network and proactively tell a customer before they get the call that the applications are slowing down and we can point out exactly which host is causing the problem. So we're actually proactively finding problems out on the storage network before they become an issue. >> Yeah and Eric, what is it about the storage portfolio that IBM has that makes it a good solution for customers that are deploying AI as an application in use cases? >> Yeah so we look at all, so one is AI, in the box if you will, in the array and we've done a ton of work there, but the other is as the underlying foundation for AI workloads and applications so a couple things. Clearly, AI often is performance dependent and we're focused on all flash. Second thing as Sam already put it out, resilience and availability. If you're going to use AI in an automotive factory to control the supply chain and to control the actual factory floor, you can't have it go down because they could be out tens of millions, hundreds of millions of year just for that day of building Mercedes or Toyotas or whatever they're building if you have an automated factory. The other areas we've created what we call, the data pipeline and it involves three, four members of our storage software family. Our Spectrum Scale, a highly parallel file system that allows incredible performance for AI. Our Spectrum Discover which allows you to use meta data which is information about the data to more accurately plan and the AI software from any vendor can use an API and go in and see this meta data information to make the AI software more efficient that they would use. Our IBM Cloud Object Storage and our Spectrum Archive, you have to archive the data, but easily bring it back because AI is like a human. We are, smart humans are learning non-stop, whether you're five, whether you're 25, or whether you're 75, you're always learning. You read the newspaper, you see of course theCUBE and you learn new things, but you're always comparing that to what you used to know. Are the Russians our friends or our enemies? It depends on your point in time. Do we love what's going on in Germany? It depends on your point in time. In 1944, I'd say probably not. Today you'd say, what a great Democratic country, but you have to learn and so this data pipeline, this loop, our software is on our storage arrays and allows it to be used. We'll even sell the software without our storage arrays for use on any AI server platform, so that softwares really the huge differentiator for us. >> So can you, as a follow up to that, can you address the programmability of your portfolio? Whether it's through software or maybe the infrastructure as well. Infrastructure, I'm thinking infrastructure's code. You mentioned you know API's. You mentioned the ability to go into like Spectrum Discover for example, access meta data. How programmable is your infrastructure and how are you enabling that? >> I mean across our entire portfolio, we build restful API's to make our infrastructure completely extensible. We find that more and more enterprises are looking to automate the deployment of the infrastructure and so we provide API's for programming and deploying that. We're also moving towards containerizing most of our storage products so that as enterprises move towards cubernetes type clusters, we work with both Red Hat and with our own ICP and as customers move towards those deployment models and automate the deployment of their clusters, we're making all of our storage's available to be deployed within those environments. >> So do you see an evolution of the role of a storage admin, from one that's sort of provisioning luns to one that's actually becoming a coder, maybe learning Python, learning how to interact through API's, maybe even at some point developing applications for automation? Is that happening? >> I think there's absolutely a shift in the skills. I think you've got skills going in two directions. One, in the way of somebody else to administer hardware and replace parts as they fail. So you have lower skilled jobs on that side and then I believe that yes, people who are managing the infrastructure have to move up and move towards coding and automating the infrastructure. As the amount of data grows, it becomes too difficult to manage it in the old manual ways of doing it. You need automation and intelligence in the storage infrastructure that can identify problems and readjust. For example, in our storage infrastructure, we have automated data placement that puts it on the correct tier. That use to be something a storage administrator had to do manually and figure out how to place data. Now the storage can do it themselves, so now they need to move up into the automation stack. >> Yeah, so we've been talking about automation and storage also for a lot of years. Eric, how are enterprises getting over that fear that either I'm going to lose my job or you know, this is my business we're talking about here. How do I let go and trust? I love, I saw downstairs, there was a in the automation booth for IBM, it was free the humans, so we understand that we need to go there. We can't not put automation with the scale and how things are moving, but what's the reality out in the field? >> So I think that the big difference is and this is going to sound funny, but the economic down turn of seven, eight and nine, when downturn hit and certainly was all over the IT press, layoff, layoff, layoff, layoff, layoffs, so we also know that storage is growing exponentially, so for example, if I'm Fortune 500 company x and I had 100 people doing storage across the planet. If I laid off 50 of them and now I'm recovered. I'm making tons of money, my IT budget is back up. I didn't go to the CIO and say, you can hire the 50 storage people back. You can hire 50 people back, but no more than five or six can be storage people. Everything else has to be dev ops or something else. So what that means is, they are managing an un-Godly amounts of more storage every year with essentially the same people they had in 2008 or maybe a tiny bit more. So what matters is, you don't manage a peta bite or in the old days, half a peta bite. Now, one storage admin or back up admin or anyone in that space, they want you to manage 20 peta bites and if you don't have automation, that will never happen. >> Stu and I were interviewing Steven Hill from KPMG yesterday and he was talking about the macro numbers show we're not (stutters) as globally and even in the US, we're not seeing productivity gains. I'm saying yeah, you're not looking at the storage business you know, right? Because if you look at anybody who's running storage, they're doing way more with much less, to your point. >> Which is why, so for example when Sam talked about our easy tier, we can tier, not only as AI base. So in the old days, when you guys weren't even born yet, when I was doing it. >> Well I don't know about that >> What was it? It was move the data after 90, so first it was manual movement, then it was set up something, a policy. Remember policy automation was the big deal 10 years ago? Automatically move the data when its 90, 60, or 30 days old. AI based, what we have an easy tier, automatically will determine what tier it should go on, whether when the data's hot or when the data's cold and on top of that, because we can tier over 440 arrays that are not IBM logo'd, multi vendor tiering, we can tier from our box to an EMC box. So if you have a flash array, you've got an old or all hard drive that you've moved into your back up in archive tier, we can automatically tier to that. We can tier from the EMC array out to the Cloud, but it's all done automatically. The admin doesn't do anything, it just says source and target and the AI does all the work. That's how you get the productivity that you're talking about, that you need in storage and back ups even worse because you got to keep everything now, which Sam mentioned GDPR, all these new regulations and the Federal Government its like keep the data forever. >> But in that case, the machine can determine whether or not it's okay to put it in the Cloud, if it's in Canada or Germany or wherever, the machine can adjudicate and make those decisions. >> And that's what the AI, so in that case you're using AI inside of the storage system versus what we talked about with our other software that makes our storage systems a great platform for other AI workloads that are not, if you will, AI for storage. AI for everything else, cars or hospitals or resume analysis. That's what the platform can, but we put all this AI inside of the system 'cause there aren't that big, giant, global, Fortune 500 has 55 storage admins and in 2007 or eight, they had 100, but they've quintupled the amount of storage easily if not 10x'd it, so who's going to manage that? Automation. >> Guys, good discussion. Not everyday, boring, old storage. It's talking about intelligence, real intelligence this time. Eric, Sam, thanks very much for coming to theCUBE. Great to see you guys again. >> Thank you. >> Thank you. >> You're welcome. Alright, keep it right there everybody. Stu and I will be back with our next guest shortly, right after this break. John Furrier is also here. IBM Think, Day four, you're watching theCUBE. Be right back. (tech music)

>> Live from San Francisco, it's theCUBE! Covering IBM Think 2019, brought to you by IBM. >> Welcome back to intermittently sunny San Francisco, this is theCUBE, the leader in live tech coverage. We're here at day four at IBM Think. My name is Dave Vellante. I am here with Stu Miniman. John Furrier is also here. Wall to wall coverage Stu. The second Think, first big show really of the year at Moscone. The new Moscone, Armando Ortiz is here. He is the vice president and partner from Mobile & Extended Reality Leader at IBM iX. An interesting part of IBM that you may not know about. Armando, welcome to theCUBE, thanks for coming on. >> Thanks for having me. >> So tell us a little bit about iX. >> So IBM iX is a part of IBM services. We focus on user experiences, whether it's a consumer experience or an employee experience. And the we look at user experience it really kind of sticks together and allow you to unlock the value of all the technology investments that companies are making. >> So, you guys are not making headsets, or are you? >> No we don't make hardware, we just put hardware to work. >> So talk a little bit about the sort of state of whether its augmented reality or extended reality. Lay out the terminology for us if you would. >> Sure, sure. As part of the role I have I lead our mobile practice as well as the extended reality practice and this kind of all related together. We use the term extended reality to kind of encompass all of the different technologies along that spectrum from augmented reality to mixed reality to virtual reality. Of course there are a lot of technologies whether it's the glasses on your face like the wearables or it's in your hand as a lot of mobile platforms today like Apple's ARKit and Google's ARCore allow you to have AR experienced within your mobile apps. >> Yeah, I wonder if you can expand a little bit on that? We're all ready for the role out of 5G and that's going, holds the promise at least for a lot more band width and a lot more applications and that's one of the lynch pins we understand kind of make your world more of a reality. When do we see that role out? What devices are going to happen? You got a preview of the next iPhone for us? >> I certainly don't have a preview of the next iPhone, even though I do lead the Apple partnership for us in North America, the Apple IBM partnership. When you look at 5G, obviously some of the use cases for extended reality in enterprise are around field services and 5G will have an amazing impact on the ability. Not only because of the band width but also the low latency that you have for 5G. So we're excited to see that role out in the different markets around the world and you know the pilots and things that are starting this year. There are going to be a lot of great devices and I think for handsets all the way to the wearables. It'll really allow us to put more use cases on these devices. >> Can you walk us through some of those use cases? Any specific customer examples you have that may make our audience understand a little bit more what's really available today. Sure, I mean in the XR space or in the extended reality space there's a lot that we learned through what we've done in mobile for years. I mean, even our Apple partnership for the past five years and things we've done across the 16 industries we work on. But the initial sort of wave one use cases that we're really seeing today kind of follow along these categories of work related use cases that are like in field services, training related use cases that go all the way from virtual reality immersive training like teaching someone how to do something in a dangerous situation where you want to simulate that. All the way to on the job sort of training and step-by-step guidance that you can get with AR. Step one attach the cable here. Step two, check this over here. Those kind of use cases and then into use cases related to shopping and retail. If you look at what augmented reality is going to do for shopping and retail allow people to assess sort of fit and purpose of something they want to buy. Does it fit in my home? Does it fit in my life? And then also even in the stores as people in retail sort of navigate a store they can use AR to help understand. Add all that metadata to the in store experience that we're gotten used to in our online experiences. And the last broad category we sort of call it share ideas or sharing of ideas, which kind of expands the game from collaboration to even having AR brochures and augmented realty tools to help people understand a product or a service that you're offering. Imagine that we can just kind of expand a piece of equipment here on the table, walk through it and help understand how that piece of equipment is going to help your business. >> You're giving me flashbacks. I remember IBM had a huge initiative in like Second Life and it was like come build an island and we're going to do recruiting and things like that. So, tell us why this generation is, going to be better for business and not have everyone put some money in and have it stolen by you know. >> Not as goofy. >> It's funny you should ask that, the Second Life topic actually came up with someone I was speaking to yesterday. It's come up before. I think there is a significant difference between what Second Life was trying to be and what extended reality is going to be and it already is. I mean when you look at extended reality today, I think one important thing to think about this is not future tech, this is not some sort of dream of sort of Ready Player One type of situation. But more, it's looking at real enterprise use cases that are already driving a value; time savings on inspections, productivity enhancements for people assembling, consistency and increase safety. All the key performance indicators and value drivers we have for mobile. So there's a real path to business value and the uses are much clearer than it might have been in the days of Second Life. >> Less mistakes, less rework. Armando, what kind of infrastructure would a consumer need? You gave the example of retail for instance, what kind of infrastructure would I need? Am I just, is it just my mobile home? Am I going to wear headsets, what does that look like? >> So when we talk about extended reality, we tend to keep one foot in today and one foot in the future cause its changing so fast. When you talk about retail there is a sale associate side of things that might be helping you decide an automotive. Maybe you're looking at configuring a car right in front of you or in a retail store maybe you're looking to look at a piece of furniture or something that's not on the show room floor. Now those experiences can start today with tablets and iPhones and other devices. But we see also as well devices that people be wearing wearables that are available today and that trend moving that glass kind of from your hand to your face is going to be something that is really going to be accelerated. >> So, this is maybe how a piece of clothing will fit or what a couch might look like in a particular room, is that right? >> Yeah. >> And you would envision that people will purchase this infrastructure for a variety of uses. Not only to see how things look but maybe there's gaming. So it's a multi-use kind of environment or not necessarily? Is it more specialized to use it? >> No absolutely, it's important, it's a good thing that you brought up sort of gaming as well. Because, obviously we all know that gaming has been kind of at the fore front for virtual reality but when you look at gaming and entertainment those are also going to include many use cases. When we look at the enterprise side we're kind of focused on those other wave one use cases. But I also expect in the sort of share ideas category I spoke of marketing and sales activities will also include AR experienced to help people understand the product or service that you're positioning. >> What's the state of adoption? We always joke about google glass. Remember the movie The Jerk with the Opti-Grab and the guy was cross-eyed? So that didn't take off but what's the state of hardware and hardware adoption today? >> So I think what's unique about this technology and what's happening now, the technology we already all have in our hands on our mobile phones is already there and that's where you're going to see it happen first. I think the numbers by next year are like 3.4 billion phones will have an AR capability so the technology is already with us. The next sort of technology set that we're talking about is getting to the wearables and of course we see things today in the VR space that's much more available in the consumer side, things like the oculus go. In the enterprise space you also have headsets from many manufacturers that maybe grew up doing things in the military that are now more commercially available. Things like someone trying to repair something that needs to be hand free. We're seeing those technologies readily available in the enterprise. >> Tell about how AI fits into this new world? >> That's a great question. If you think about it its really kind of a really great combination. You take XR, extended reality, so whether its AR or VR and you add AI to it you can kind of give AI the ability to kind of enter the 3D space. So as you think about AI solutions that we had in the mobile world where you might be using AI to solve a problem, diagnose a problem, visual diagnostics, acoustic detection AI can kind of give sort of super powers to an employee. At the same time we see that the experiences that we have in the extended reality space get really enhanced because you now have the ability to democratize expertize with AI. You take all of the expertize of your organization and that one technician whose only been there for 10 days now has the power of your entire collective knowledge. >> What about privacy? Anytime you hear some of these and I think about you can have wearables out there, there is concern about you know with facial recognition is going to be everywhere my privacy is going to be invaded. What's IBM positioning? Where does that fit in this whole environment? >> Of course we take privacy very seriously. When we talk about our AI and Watson you know your data is your data. If you look at some of the things, I mean, you'll make decisions, enterprises will make decisions on the same way they do with mobile devices. Is it okay to have a camera in this environment? And if I do have a camera in this environment, what's my cloud strategy and where am I going to host this data to make sure that I have not just privacy but also IP concerns, considered? All of the same things we've learned in the mobile world are going to apply to this and it'll get even a little more important as you think of the different types of sensors that are required to make these experiences happen. >> I wonder if you could help us understand about the pre-requisites to do things like technician actually trouble shooting a problem. Many of us have seen, we put on the glasses you walk around a show floor and you look at a new system or something and its really very cool. You can look inside and inspect the different layers. What has to be done, I'm inferring from what you're saying that a technician would be able to inspect live, real time a device and identify problems on that device. So what has be done? It has to be instrumented? It has to have cameras installed? What does the infrastructure build out look like? >> Sure, when you look at. Lets take the technician scenario for a moment and unpack that. When you look at that there are a couple of things that are already happening like a lot of major pieces of equipment are instrumented. So you have the internet of things data, sort of the data streams coming off of that. How do you make that available to that technician in the moment, sort of the vital signs of that piece of equipment that you might be operating on? So, having all that information like temperature and all the things from an IOT perspective, that's one angle of it. The other side of it really is when you think of failure of equipment usually at some point there's a situation that technician may not have encountered before but maybe someone else has. Maybe you've already had a bunch of closed tickets on that three years ago. So having all that information available and using cognitive processing to kind of navigate that unstructured data, that will let you navigate that. Voice will be part of this interface as well. I think voice is an important part because you're going to be hands free and you're going to be having a dialogue with Watson, let's say to help diagnose a problem. >> How about healthcare? It's not something we've really talked about a lot. Just in terms of applications, whether its for the operating room of the future, remote guidance from doctor, training. Do you see those kind of use cases emerging? >> Yeah absolutely, all the way from training through execution of surgery and other things. This is where the 5G topic really comes into play because low latency is really required if you're talking about surgery and things like that. >> Give me a few minutes. >> You get that round trip of that signal going back and forth. I think when you think about the VR side of things for training is immensely powerful. The AR side for during execution of procedures will also be powerful as well and it comes back to that general theme od democratizing expertize. One expert that's physically on this part of the world can serve many people that need their services around the world. >> It sounds like there are a lot of uncertainties in terms of how this is going to evolve. First of all od the a fair statement? Given that, not withstanding that can you give us a sense of expectations for how it will evolve and the adoption levels that you expect over the next two to five years. >> Five years is a long horizon for this technology. >> Too long, too long perhaps so what's more fair, 18 months? >> Lets talk more immediate. I think when you look at, there may be some uncertainty in terms of which use cases will drive the most value but there are already many use cases that companies are probably sharing information out. Like some companies, especially inspection use cases, you know there is a company that published 96% savings on time because really you are using AR to document. Okay inspect this point, this point, this point, this point. Assembly use cases, diagnostics with AI and AR are working together. All of these are already happening, so what I think is going to happen is enterprises are going to be able to more and more easily justify the spend to make these investments because the RY is rapid. Just like the RY in mobile was rapid for enterprise, the RY in XR will be extremely rapid. >> Armando for people who didn't come to IBM Think, give them a little taste of what they missed from an iX stand point. Some of the conversations that you've been having. >> Yeah, when we look at, I mean iX across the IBM Think we've had a lot of conversations and a lot of sessions around how experience is really driving the business value and also around marketing technologies and marketing services and all of the things that relate to experience on the consumer side and the employee side. We're really enjoyed some great show casing of our client stories and the works we've done. Everything from mobile to commerce to marketing platforms to sales floors across everything we do in the IBM services part that we're in. >> How long has this been around? >> IBM iX? >> Yeah. >> IBM iX has been a part of IBM originally since the 96 Olympics in Atlanta. I've been with IBM about 25 years and this space is kind of like really evolved in terms of the position of user experience and design. IBM has become really a design focused company and you look at enterprise design thinking in everything we do so this is really a part of our business that's really become focal point as companies start thinking more about design. >> Wow, it's been a long time but it's certainly not mature but it's a revenue generating business obviously. >> Yeah and a very high growth part of the company. >> Awesome, well Armando thanks so much for sharing this part of IBM that's not well known. Really exciting futures and I really appreciate you coming on theCUBE. >> Thank you very much, I appreciate being here. >> Alright, keep it right there everyone. Stu and I will be back. Day four, IBM Think, we're at Moscone. Stop by, we're at Moscone North. I'm Dave Vellante, Stu Miniman and John Furrier is here. We'll be right back, you're watching theCUBE. (techno music)

>> Live from San Francisco, it's theCUBE. Covering IBM Think 2019, brought to you by IBM. >> Hello everyone welcome back to theCUBE's live coverage here at IBM Think 2019 in San Francisco, our exclusive coverage, day four, four days of coverage events winding down, I'm John Furrier with Stu Miniman, our next guest, Eric Herzog, CUBE alumni, CMO of IBM storage and VP of storage channels, Eric great to see you wearing the Hawaiian shirt as usual. >> Great, I can't come to theCUBE and not wear the Hawaiian shirt. You guys give me too much of a heart attack. >> Love getting you on to get down and dirty on storage and the impact of Cloud and infrastructure. First, you gave a great talk yesterday to a packed house, I saw that on social media, great response, what's going on for you at the show, tell us. >> So the big focuses for us are around four key initiatives. One is multi-cloud particularly from a hybrid perspective and in fact, I had three presenters with me, panelists and users, all of them were using multiple public cloud providers and all of them had a private cloud. One of them also was a software as a service vendor, so clearly they're really monetizing it. So that's one, the second one is around AI, both AI that we use inside of our storage to make it more efficient and more cost effective for the end user, but also as the platform for AI work loads and applications. Cyber resiliency is our other big theme, we've got all kinds of security, yes everyone is used to of course the Great Wall of China protecting you and then of course chasing the bad guy down when they breach you, but when they breach you it'd sure be nice if everything had data at rest encryption, or when you tiered out to the cloud you knew that it was being backed up or tiered out fully encrypted or how about something that can help you with ransomware and malware. So we have that, and that's a storage product not a regular, you know what you think of from a security vendor. So those are the big things that we've been harking on at the show. >> One of the things that I've observed, you've been very active out in the field, we've seen you at a lot of different events, Cisco Live, others, you guys have had an interesting storage product portfolio, very broad and specific leadership categories, but you also have the ability to work with other partners. This has been a big part of your strategy, you get the channels. What is, how would you summarize the current story around IBM storage and systems, because it's now an ingredient part of other people's infrastructure with cloud storage then becomes a key equation, how would you describe the IBM storage posture, product portfolio, what are the key things? >> So I think the key thing from a portfolio perspective, while it looks broad it's really four things. Software defined storage which we also happened to have bet on on array so theoretically that's one product line, same exact software. Other vendors don't do that, they have an array pack and you buy the array but if you buy their software defined storage it's actually different software, for us it's the same software. Then we have modern data protection and then we have management playing. That's kind of it. I do think one of the big differentiator for us, is even though we're part of IBM, we have already been working with everyone any way. So as we talked about at Cisco Live, for Spectrum Protect alone, our modern data protection platform, we have 400 small and medium cloud service providers all over the world that their back up service is based on it, so even though IBM Cloud has their own cloud division theoretically, we're enabling the competition but we've had that story at IBM storage now for four years. >> So storage anywhere basically is the theme here, AI anywhere storage anywhere, I mean it's not the official tagline but that's the philosophy with software. >> And that's yeah, so even if you think look at AI. We have an AI reference architecture with the power product line, we also have an AI reference architecture with the Nvidia product line, and we're working on a third one right now with another major server vendor because we want our storage to be anywhere there's AI and anywhere there's a cloud, big medium or small. >> Alright, Eric let's tease that out a little bit because I had a great conversation with an IBM fellow yesterday and we think back ten years ago, when you talked about hybrid and multi cloud, when you talked about an application it's "Am I spanning between environments? "Am I bursting between environments?" And architectures just didn't work that way. Today microservices architecture, there's pieces of the solution that can live in lots of environments, Compute I can spin up almost anywhere at any time, data doesn't move and I need to worry about my data, I need to worry about security so there's certain things that multi cloud like data protection, cyber resiliency, those kind of ones need to live everywhere, but when I talk about storage, I'm not moving my storage and my persistent database all over the place. So help us kind of tease out as to what is the multi everywhere and what is the you know the data that the Compute's going to actually move to that data, help us squint through that a little bit. >> So let's do the storage part first. So most applications, workloads, and use cases that are either business critical or mission critical are going to stay on prem, doesn't mean you can't use a public cloud provider for overflow whether that be IBM or Amazon or Microsoft or like I said the 400 cloud providers that we sell to that are not IBM, so but you're still going to have this hybridness where the data is partially on prem and off prem, in that case you're going to be using the public cloud provider, and by the way we did a survey, IBM did, and when you're looking enterprise, so let's say companies that are three or four billion US and up, anywhere in the world, you're seeing that most of them are using five or six different public clouds, whether that be salesforce.com which really is sales enablement software as a service. We have a startup that we work with who uses IBM's flash system and they do cyber security as a service, that's their whole business. So all of this software vendors that now deliver not on prem but you know over the cloud. Then you've got regular public cloud providers for file, block, and object for example we not only support IBM Cloud object storage protocol, but S3. So we have customers that put data out in S3, we have customers that put it out on other clouds because as you know S3's become the de facto standard so all the mid to small cloud providers use it. So I think what you've got is hybrid cloud is a sort of a subset of multi cloud and then multi cloud what you're seeing is because of software as service could even be geographic issues, we have a lot of data centers at IBM Cloud so do the three major cloud providers, but we are not in all 212 countries so if you have the law like in Canada where the data has to physically stay within the premises of Canada, now we all happen to have data centers that are big enough, but that doesn't mean we have data centers in every country, so you have legal issues, you have applications what applications are good, that make sense, what about pricing, and as you know some big companies still buy regionally. >> Eric, one of the things I'd love to get your perspective on is the SAS providers because if we look at the storage market in many ways, you know there was like the threat of public cloud, but really you got to follow the application, follow the data and as SAS proliferation happens, your data is going to go with that, you know you have them as customers in a lot of environments, what are you seeing from the SAS providers, how do they choose what offerings they have and how do they look at their data center versus public cloud mix? >> So when you look at a SAS provider, they've got a couple of different parameters that they look at which is why we've been very successful. One is performance, they already know their subject to the vicissitudes of the cloud so you can't have any bottle neck in your core data center because you're serving that app up, and if it's too slow or it doesn't work right, then of course the end user will go buy a different piece of software from another SAS provider. Second one is availability, because you have no idea when wiki bomb theCUBE is going to turn on that service, it could be the middle of the night right? If you guys expand to Asia, you guys will be asleep but your guy in Australia will be using that software, so it can't ever go down, so availability. Resiliency, can it handle pounding. If CUBE wiki bomb becomes ginormous, and you buy all these other analyst firms and the next thing you know the biggest analyst firm in the world, if you have thousands of people guess what now you're hammering on that software, so it's got to be able to take that workload abuse, right? And that's the kind of thing, so they look for that. >> That's scale basically, scale is critical. >> Right, they cannot have any issues of resiliency or availability and performance so A: they're usually going all flash, some of them will buy like a tape or the older all hard drive arrays as a backup store, ideal for IBM cloud object storage but again the main thing they focus on is flash because they're serving up that software. >> Let me ask you a question, so I know you've been in this business for a long time, storage you know everything about the speeds and fees but also you've been a historian too, you're on the front edge. IBM has got a killer strategy with cloud private, doing very well with Openshift and Redhat acquisition, you're now poised to essentially bring cloud scale across multiple clouds and with AI, it really puts storage at the center of the action. How is storage now positioned and how should customers think about storage, because scale is table stakes, enabling developers to program infrastructure as code, how does storage and how has it changed and how are you guys positioned to take advantage of that? How would you kind of explain that to a customer? >> Yeah so I think there's a couple of changes, first of all you're looking for a storage vendor which should be us, but you're looking for a storage vendor that is always making sure, for example when micro services first came out and containers, okay great except when containers came out and it's still a problem, you don't have storage consistency whereas in a VM ware or a hyper V or you know KVM environment, you do. So when you move things around, you don't lose the dataset, well we have persistency storage. So the key thing that you want to look for is a storage vendor that will stay on that leading edge as you move. Our copy data manager has an API so the developers can spit up their own environments but use real data, so as you guys know well from your pasts that the last thing you want to do is have the dev ops guy be developing things on faux datasets, try to put it in production, and then the real dataset doesn't work, at the same time if they put it out to a public cloud provider you could have a legal or security breach, right? So by being able to take modern data protection, as an example, and not just to have grandfather, father son back up, we all remember that I remember it better than you guys since I'm older, but that's back up right? It's not back up any more, it's modern data protection. You need to be able to take the snapshot, the replica or the back up dataset and use it for development, so you want a storage vendor that's going to be on the leading edge of that. We've done that at IBM on the Kenner side, the modern data protection side, and we'll continue to the do that. The whole multi cloud thing, IBM as you know is now all about multi cloud, what Redhat's been in, the storage division of IBM has been working with Redhat for 15 years. Going to the Redhat summit every year, I know you guys do theCUBE from there sometimes. >> You're on, but this is software defined so at the end of the day a software defined bet with arrays have paid off. >> Yes. >> You'd say that would be kind of a key linchpin. >> I would argue that, while there's some hardware aspects to it, so for example our flash core modules give us a big differentiator from a flash perspective, in general the number one differentiator for a strong, powerful array vendor is actually the underlying software code. The RAID stack, what you can wrap around it, file block and object support, what could you enhance, our Spectrum discover, allowing you to use metadata about unstructured data whether that be in the file space of the object store. That allows the data scientist to dramatically reduce the time it takes to prep the data when they're doing either AI or an analytic workload, so we just saved them money but we're really a storage company that came up with something that a data scientist could use because we understand how storage is at the central foundation and how you could literally use the metadata for something actually valuable, not to a storage person because a data scientist is not the storage guy of course. >> Yeah and Eric I would love to get your feedback, what are some of those key discussions you're having with customers here at the show? We've been talking a lot this week digital transformation, AI into everything there, are those some of the themes? What are the struggles that really the enterprises of today are facing and how your group's helping them? >> So one of the big things is understanding that it's going to be multi cloud and so because we've already been the Switzerland of the storage industry and working with every cloud provider, all the big ones, including ones that compete with our own sister division, but all the little small ones too, right? And all the software as service vendors we work with that we're the safe bet, you don't have to worry about it. Because whoever you pick, or for a big enterprise, in fact I had Aetna on stage with me and he said he's using seven different clouds, one of which is their private cloud and then six different cloud providers they use, and he said not counting salesforce.com and I forgot the other name, so really if you count the softwares there, she really got like nine clouds. She said I use IBM cause I know it's going to work with whoever, and you're not going to say oh I don't work with this one or that one. So that's been obviously making sure everyone realizes that, the whole company is embracing it as you saw and what we're going to do obviously with Redhat and continue for them to participate with all of their existing customer base that they've been doing for years. >> So you see multi cloud and sweet spot, that highlights your value proposition, would you say that to be true? >> I would say that and then the second one is around AI. All the storage vendors including us have had AI sort of inside, what I'll call inside of the box, inside of the array and use that to make the array better, but now with AI being ubiquitous from a work load perspective, you have to have the right foundation underneath that, again performance resiliency availability, if you're going to use AI in a giant car factory, and it's going to run all of those machines, you better make sure the thing never fails because then the assembly line goes down and those things are hundreds of millions of dollars of build every day. So that's the kind of thing you got to look for, so AI's got to have the right platform underneath it as well. >> Eric you have some reporting from the field as you're out in the, doing a lot of talks a lot of customers, give it a couple of anecdotal examples of where the leading edge is in storage and where are use cases that would be a good tell sign of where this kind of multi cloud is going. Can you just give some examples of the use cases, situation, and kind of why is that relevant for where everyone will be going? Where is the puck going to be, so I can skate to where the puck is, as they say. >> So from a multi cloud perspective, A: you've got to deal with how your company is structured, if you have a divisionalized company or one that really lets the regions make their own buy decisions, then you may have NTT Cloud in Japan, you may have Ali Baba in China, you may have IBM Cloud Australia, and then you might have Amazon in Latin America. And as IT guys you got to make sure you're dealing with that, and embrace it. One of the things I think from an IT perspective is why I'm wearing the Hawaiian shirt, you don't fight the wave, you ride the wave. And that's what everyone's got to realize so, they're going to use multi cloud, and remember the cloud was the web was the internet, it's actually all the same stuff from a long time ago, the mid 90's, which also means now procurement's involved and when procurement's involved, what are they going to say to you? Did you get a bid from IBM Cloud, did you see that bid from Amazon and Microsoft? So it's changed the whole thing of, I can just go to any cloud I want to, now procurement's involved that even mid-size companies procurement says you did get another bid right, did you not? Which for server, storage, and network vendors that's been the way it's been for 35, 40 years. >> The bids are changing too, so what are the requirements now? Amazon has a cloud, they have storage, you have storage, but people have on premise they have multiple environments. If the world is one big data center, with multiple regions and locations, this is the resilience you spoke of, what's the new requirements as procurement gets involved because procurement isn't dictating the requirements, they're getting the requirements from the application work loads and the infrastructure, so what are the new requirements that you see? >> So I think the thing you're seeing is if you take cloud just a couple years ago, I'm going to put my storage out there, okay great, I need this kind of availability, ooh that's extra money, sorry Mr. Wikibomb, Mr. CUBE we got to charge you a little extra for that. Oh we need a certain amount of performance, oh that's a little extra. And then for heavy transactional work loads the data's constantly moving back and forth, oh we forgot to tell you that we're charging you every time you move the data in and every time you move the data out. So as you're putting together these RFPs you needs to be aware of that. >> Those are hidden costs. >> Those are hidden costs that are, I think the reason you're seeing such the ride of the hybrid is people went to public cloud and then someone in finance, or maybe even in the IT group sat down with a spread sheet and said "Oh my god, we could've just bought an IBM array "or someone else's array" and actually had less money even counting support, because all every time we're moving the data, but for archive, for back up we don't move the data around a lot, it's a great solution for anything. Then you have the whole factoring of software as a service, so part of that is the software itself, if you're going to go up against salesforce.com then whoever does, they better make sure the software's good, then on top of that again you negotiate with the software vendor, I need it globally, okay what's the fee for that? So I think the IT guys need to understand that with the ubiquity of the cloud, you've got to ask way more questions, in the storage array business, everyone's got five nines and almost everybody's got six nines, well way back when it was four nines then it was five and now it's six, so you don't ask anymore because you know it just changes right? And the cloud is still new enough and the whole software as a service is a different angle, and a lot of people don't even realize software as a service is cloud, but when you say that they go, what are you talking about, it's just I'm getting it over a service. Where do you think it comes from? A cloud data center. >> Well the trend is software defined, you guys are on that early. Congratulations, and don't forget the hardware, the high performance hardware as well, arrays and what not. So great job. Eric thanks for coming on, appreciate it. >> Great, thank you very much. >> CUBE coverage here, I'm John Furrier, Stu Miniman. Day four of our live coverage here in Moscone North, in San Francisco for IBM Think 2019. Great packed house here at IBM Think, back for more coverage after this short break. (electronic outro music)

>> Live from San Francisco, it's TheCUBE. Covering IBM Think 2019. Brought to you by IBM. >> Welcome back to Moscone North at IBM Think 2019 I'm Stu Miniman, and my cohost for this segment is Dave Vellante. Happy to welcome two IBMers from the Z Group, we have Michael Jordan, distinguished engineer, everybody I'm sure in your family calls you the Michael Jordan? >> Nah, no, no >> Not the other one? >> I won't get into what they call me. >> Rohit Badlaney, who's a director of IBM Z as a service. So Rohit, we have to start there. We're very familiar with Z, you know, all the different pieces of it, but Z as a service, something new for this week, maybe help explain what the news is and-- >> Absolutely, so my mission in life is around Z and cloud. And this week you heard Jenny talk about Hyper Protect, and Hyper Protect is a family of services built in our IBM Cloud, on a cloud-ready systems, which are the ZR1 systems, in a multi-zone platform factor, so it provides the high availability disaster recovery. There are really four key services that we're announcing at this conference. One's around crypto and key management, provides the highest levels of security for our cloud. The second's around data as a service, which does traditionally really well on the platform, as a data-serving platform. The third's virtual servers, the fourth's containers that's going to be tied in to our Kubernetes Service. So we're bringing the breadth of our Z to our cloud. >> Yeah, you know, Michael, I show my age in the industry, I remember when we talked about security was, you know, lock the door on that rack that was in, or that mainframe that sat in the corner, we knew that that was secure. It's a little bit different when we talk about security and Z these days, it's cloud, it's global, >> Sure. >> It's all over the place. >> So-- >> But in fairness, right, I mean RACF was the gold standard of security, you know, before all this distributed systems stuff. You knew, you had full visibility on who did what, when, where, you know, very very detailed. Have you been able to carry that level of transparency and rigor into the cloud? >> Yeah, so some of this is what's old is new again, so one of the key areas that is a big focus for security in the cloud is encryption, right? You know encryption is going to a central part of being able to move data to the cloud, and the concepts of being able to bring your own key, is absolutely essential, and some of the capabilities that we've had on the Z platform for a very long time actually lend themselves extremely well to a cloud environment so for example, our cryptographic hardware can be virtualized, right? So each server can have 16 cryptographic cards, with 85 virtual domains per card, so you multiply that out it's, really serves cloud scale very well. And in addition to that, the cryptographic hardware is designed to meet the highest level of security certification standards, so a combination of security, and that virtualization really lends itself to offering a set of cloud services. >> If I think about the workloads that are running on Z, clearly there's no business case to move them off Z, into some commodity cloud, that would make no sense. You'd put your business at risk if you did that. But what's the business case of Hyper Protect, and Z as a service, could you talk about that a little bit? >> Yeah, so today our focus is primarily to elevate the security of our core and our cloud. If you look at what we are doing, it's around our Linux systems and not our traditional z/OS systems, and we're really focusing on where Z differentiates. It's around, you know Mike talked about key management, and key protection. It's around data protection, it's around scale. So the workloads, to your point, that do really well on the platform, are workloads that need that level of infrastructure characteristics. And it's not a well-known fact, but actually our Blockchain platform, and all the success IBM's had on Blockchain, has been running in our cloud, on our Z systems, over the last two years with 500 plus clients. Right, so those are the kind of workloads that benefit from the hardware characteristics, as well as the security characteristics. >> Just double-click on that, so you think Blockchain, often times you're thinking about distributed apps, you know, you think about transaction limits, et cetera et cetera, so what are the attributes of Z that lend itself well to those workloads? >> Oh that's a great question, so, several attributes, right? Definitely the key protection, and the data protection on Z, the sheer TPS, you know it's funny, I was actually with our BC doing a session today, and they were talking about the transaction per second they get by just running on Z versus commodity hardware. And they've had tremendous success, right? So those two, combined with you know, our Blockchain technology in our cloud runs on something called a Secure Services Container, which is an absolutely locked down container that no one can get access to. And those are the characteristics that, if you think about permissioned blockchain, that's where Z excels. So that's. >> One of the discussions we've been having is that, in a multi-cloud world I have different skillsets for the different environments. Can you give me a little compare/contrast how security fits in Z versus you know, x86, Linux, and public clouds? And also, how do I, as a customer, manage across those environments from a security standpoint? >> Sure, so a couple points on there. You know, one is, one of the benefits that we have with Z is we control a large portion of the stack, right? So we're able to integrate security into multiple layers of the stack. So Rohit mentioned the Secure Service Container, and that combines a number of capabilities that we've built in from the hardware, the firmware, the operating system, end to end. So for example, the Secure Service Container by default, all of the code and data associated with with one of these Secure Service Containers is encrypted. You don't have to do anything, it's, you deploy an application in of these containers, everything gets encrypted, in flight and at rest. And there's no configuration, no set up for that, it happens automatically. We validate, digitally sign and validate all of the firmware, the operating system, the application, and the entire package that gets loaded into one of these environments, to protect against introducing malware to that environment, and lastly is we block and restrict administrative access to prevent administrators from having uncontrolled access to the file system. So looking at that, right, since we own that stack and we can really integrate those security capabilities vertically through that stack to give the true value and the capabilities that you need in the cloud to protect both the application and the data. >> And that's always been the strength of the mainframe, is like you said, security's not a bolt-on, it's designed in from the very beginning. I mean when I started in the business, whatever IBM did with the 390, or whatever it was at the time-- >> You're dating yourself. >> Yeah, that's true. But the whole industry would focus on that. And then, frankly, IBM in the early '90s kind of lost it's way because it had that sort of install base, and it didn't really have to innovate. That's not the case today, you guys, well you have an install base who eats up, sort of every new cycle of Z. You've had to innovate, you've had to really invest in the roadmap, and stay current. Whether it's, you mentioned Blockchain, certainly Linux, et cetera. Now infusing AI as a service, so I wonder if you could talk a little bit about the sort of roadmap that you and your colleagues are on. Without obviously divulging futures, but there's a legacy there that you've invested in, and had to keep really current with some of the major industry trends to keep your clients happy. >> Yeah, and I'll weigh in and then Mike can jump in. I mean, the legacy of Z has always been scale, performance, hyper security, for the most regulated industries, for the most compliant industries, and our biggest enterprises. And that's going to continue, and the next generation of Z's going to continue down that theme. We are very focused on making Z part of the cloud. And so, there's a breadth of announcements, and I know we talked about Hyper Protect and the public cloud, but we're also expanding the Kubernetes orchestration on-premise with our IBM Cloud private product being supported fully on LinuxOne, and expanding it to Linux workloads, and z/OS workloads. And that is, you know, the cloudification of the platform is, I think, the next big step for us. >> But, so what's the real business driver for clients there? Is it just the notion of pay by the drink, and as a service? I mean obviously mainframe invented virtualization, and simplified management, and was always a key part of it, a key tenet. What's the real business driver for people to move to the cloud? >> I mean, in my view guys, it's the speed that they need to move at, right? I mean, you look at why we are standardizing on PaaS platforms, whether it's on the cloud or on-premise. The teams are constantly getting pushed to move faster, DevOps, now there's a new concept of DevSecOps, right? It's all about speed that's driving the need for the cloudification of the platform. The other reason is skills, right? Can I work with the mainframe in a way that I'm abstracting away the special skills needed, but I could still move with that speed in the DevOps cycle, right? So I think it's a combination of those both that's really driving this. >> And from a security perspective, I think a couple of the key points are looking ahead we're really focused on the data, right? How do we allow organizations, 'cause it's going to happen, right? Organizations will need to move data, whether it's temporarily, or longer term. They're going to need to move data to the cloud, that's just, it's a fact of life. So, how do we leverage and harness the capabilities that we have, that we've been talking about with the Z platform to enable clients to securely move their applications, pieces of applications, and data to the cloud so they can take advantage of the capabilities that Rohit was doing, with confidence that their data is not going to be compromised. And that includes a data-centric approach to protection of data, as well as protecting encryption keys and leveraging and taking advantage of the capabilities that we have on the platform for key protection, which is already a key part of the solution that we're bringing to market today. >> So the Z customer that bets his or her business on your platform, I mean, it's embedded, it's fundamental. What's the reaction been to Hyper Protect, you know, kind of feedback that you've had from clients? >> You know, everyone wants to be cloud today, right? So the reaction is actually been really positive. You know we've been working with our biggest Z clients, through what we call the Z Design Council, you know, validating the story. Because we want to help them on this enterprise-out journey. And the reaction has been good. Now, it's, it really depends on where they are on their cloud journey as well, right? Some are very much still want to be an on-premise shop, and some are aggressively moving to the public cloud. So our goal's really to intercept them wherever they are on that cloud journey. >> Yeah well many of them have a cloud mandate, right? >> Absolutely. >> Well, and I have clients come up to me on almost a continuous basis. When they look at what we, the capabilities that we've delivered with our z14 machine, and the cryptographic horsepower that we have with that machine, they're looking at it and saying hey, how do I harness this as a, you know, a crypto as a service for our enterprise? Which is kind of the precursor to what we're doing with the Hyper Protect services, but there is a keen interest from organizations to have a secure, performant, secure, stable environment for cryptographic services because, encryption is becoming ubiquitous, so providing that capability I think is significant. >> Yeah, and our goal, like Mike said, is really to make security easy, right? Whether it's in the public cloud and the enterprise developers don't have to worry about it. Can they get the levels of security that they need for their enterprises, or their enterprise workloads, but in an easy, cloud-native consumption model? That's really what Hyper Protect is. >> Yeah, I guess so final question is, what's the pricing implications of this new offering, and how do customers get started? Is this ready, shipping today? >> It's shipping in March. It's available today, that's the beauty of cloud, right? We went through what we call the experimental services, it's available in beta today. You could go to our IBM Cloud Catalog, access it, get it, try it. >> Great, give you a final word and takeaways you want people to have when it comes to security in the Z space. >> Yeah, so I think the main thing is that Z has a very proud tradition of security leadership and innovation, and what we're bringing to the market here is just another example of that security leadership and innovation. >> All right, well Michael and Rohit, thank you so much for bringing us the update-- >> Thanks, guys. >> Congratulations, on bringing the product to market. >> Thank you. >> Look forward to-- >> Good luck with it. >> Thank you. >> Thank you guys so much. >> All right, for Dave Vellante, I'm Stu Miniman, we'll be back to wrap up our day three of four days live, wall-to-wall coverage here, from Moscone North, IBM Think 2019, thanks for watching TheCube. (energetic techno music)

>> Live from San Francisco, it's theCUBE covering IBM Think 2019, brought to you by IBM. >> Hey, welcome back everyone. We're here live at theCUBE in Moscone North in San Francisco, for IBM Think 2019. I'm John Furrier with Stu Miniman, talking to all the top executives, top people here at IBM, getting the scoop on cloud and AI. Our next guest, Jason Gardner, Vice President of Worldwide Sales for Hybrid Cloud at IBM, manages key product, which is part of the IBM Cloud Private, big part of the announcements, big Cloud story here. It's multi-cloud, it's hybrid. Welcome back. >> It's hybrid multi-cloud. Thank you, for having me back. >> CUBE Alumni been on as early, going back as 2012. Now, one big event. >> I can't believe it's been that long. But yeah, I'm happy to be back and I can't believe I've been on theCUBE for so long. >> Talk about your new role, and you had previous roles within IBM dealing with the kind of clients and integration. Your role now is worldwide sales. You're taking this Cloud Private offering, bringing the customers, being as the linchpin for integration. Talk about what you do and some of the engagements you have. >> Yeah, previously, I was really focused in on development and offering management on, point products and how they help clients move to the Cloud. Things such as our Pure Business, our Spare Business, and now I've actually been able to move into a much more horizontal role, where I have the portfolio across the Hybrid Cloud integration side, so everything from our Websphere family, which includes IBM Cloud Private, straight to the integration challenges that that brings as well as our digital business automation portfolio. >> Yeah, I have a personal joy. Stu knows I'm fanatic about Kubernetes, and when I heard Ginni Rometty say Kubernetes twice in a CNBC interview you know it's made it. >> Yes. >> Kubernetes is a big part of cloud native containers, really now has created the connective tissue to make cloud and multi cloud viable. This is a key part of it. I want you to talk about the context of these trends and unpack this Cloud Private offering. Because it's instrumental in seems in the news. >> It is, it is. >> What is it about? >> It is, it really creates that ubiquitous layer I think that we've all been searching for. That next generation of virtualization and connective tissue as you call it. And as you begin to unpack that it really kind of starts with the rise of microservices and the need to be able to pack them very tightly into containers. That's really the birth of Kubernetes, was the ability to orchestrate those containers. So Kubernetes becomes that ubiquitous layer in there. But, IBM Cloud Private takes that and takes it to the next level, right. And, really what it is, it's the services on top of that, the cloud services which enable those containers to work together. And, it is a lot of open source capabilities such as Helm, Prometheus, Kibana and some of those core services that those microservices require in order to be able to run efficiently. >> So, Jason, we know it's a multicloud world. Everybody out there would love to say, oh yes, there's one cloud, I can simplify it. I'd like to get to a nice scalable model that's simple. But, the reality is customers choose lots of different solutions because they have different needs. The Private Cloud piece is not really well understood. I'd love you to take us inside your users. Because they say okay, I'm using Amazon, I'm using Microsoft Business Services. There are certain data things that Google has. IBM has AI and business productivity and database offerings. That Cloud Private, what are the services, what are the use cases, what are the reasons why I'm buying this and being part of my overall portfolio. >> Yeah, Ginni called it Cloud 2.0, right. 1.0 was about lifting shift, it was about cloud native, and that really got us about 20% of the way there. It's at 80%, that's the real challenge, that's really where the complication comes into play. That's really what Private Cloud is about. Because not everybody can be able to take their applications, throw them away, build cloud native, or lift and shift them. If you think of big regulated industries like banking, insurance, healthcare, government. They really need to be able to have that level of security and assurances that they need within there. And, that's really where private cloud comes into play, is those really tough, challenging problems in the industry. >> Yeah, I love that. A trend I've heard from a number of customers, you talk about them getting to containerization and multifactor services, is, step one is, I've got to modernize the platform-- >> Absolutely. >> Then I can modernize the applications on top it. Is that the trend you're seeing? >> Yeah, definitely. We've been building on microservices and modernization, it's a journey right, and it's a journey of discovery I think for a lot of clients out there. And, we'd all love to be able to say, OK this is my platform and now I'm going to work on the applications. But really, sometimes the starting point may be one or the another, and it usually comes in a space of a digital requirement, and so they begin to out modernize the application and then realize, jeez! I need to be able to manage all of this, I need to be able to deploy it all, and that's when the platform comes into play and all the other services, I should say, that come along with it. >> Stu, I think you coined the term Private Cloud. I think wasn't it? >> The true private cloud. >> True private cloud. So the private cloud, again, it's all cloud operations, so I kind of disagree on this whole point about one cloud or multi-cloud. Because I think, yes multi-cloud, but you see people use cloud for workloads, right? So pick the right cloud for the right application. So this basically says, okay, if you want to use Amazon, use Amazon if that's what you want, but if you are going to use 365, maybe use Azure. >> Yep. >> If you are going to use G Suite, use Google. You guys kind of have the business apps nailed down. >> Right. >> So If you're going to use your business apps, maybe IBM. This is your opportunity. >> This is our opportunity. >> Talk about specifically the kinds of apps that you guys will power with your cloud, because multi-cloud certainly makes sense for you guys. It's multi-cloud, you won't that portability and interoperability, but the apps that you're going to power with IBM Cloud. Talk about what they are, how-- >> Yeah, if you look at, from a language perspective over the last, jeez it's been 23 years I think, since the rise of Java, right? And 1995, when the first app servers came out. Those app servers, that is really where ore applications really run on top of. And, it's those core Java applications, that are now needing that facelift, right? They need to be able to be injected with new forms of AI, new types of integrations, new types of personalization of that digital transformation that's driving it, and that's really the core suite, right? And if I look at that core suite in there, and then what do you do to modernize a Java application, and what kind of tools are available to you. How do you then manage, how do you distribute, and how do you scale those applications. It's very important. >> What is the adoption of the private cloud or the Cloud Private product. >> Yeah. >> Talk about some of the trends, how is it being used, be specific on how customers are using it. What are some of the use cases? >> Yeah, so the primary use case is to increase the agility, lower cost on the overall managing of them. But it's the increase in the agility, which is really hard to measure. Because clients want to be able to react very fast to it. And so as they build up microservices, microservices then become independent with one another. You can then update ones, very quickly and easily. They manage and they run independently, and they scale independently, and so Cloud Private provides you with all those services to able to run those microservices as containers, but then be able to tie them together in a much more comprehensive enterprise suite. You know, a core technology like Helm, I'm waiting for Ginni to say that one on stage. But a core technology like Helm, really provides that robust, enterprise class distribution for scalability and high availability of a microservice based application. >> Jason, can you bring us inside the organization of the customers your selling to? It used to be, it was the refresh cycle. It's like OK, my X86 refresh, or you know, the budget cycles that I had. Cloud is quite a bit different. >> It is. >> Private Cloud is kind of straddling between the old world and the new world. What are the dynamics you're seeing as to who controls the purse strings? Are they moving faster to that opex model. >> You know, there's no one person who owns the purse strings on it, but it does float between the infrastructure team, knows that they need to do something different, the developers or the application development team, and really the strategy, the Chief Strategy Officer, in that IT organization is really where it's coming together. Because one thing I think that we've all learned is that developers will find the easiest, fastest way to do something. No matter what rules or policies we put down. And this is about providing them with an environment that has guardrails, for them to be able to innovate as fast as they want, use the tools that they want, that their most comfortable with. Really, it's a grass roots kind of movement into these microservices, led by the developers. But the purse strings are still held at the CTO side. >> That's always a fascinating interest, because the developers they're going to go do it, but they're not usually the ones with the budget. >> That's right. >> But when do the ops people get involved, the business people, to make sure that IT manages it, gets rid of like stealth IT? >> And a lot of clients have learned to listen to the developers, because the early days of cloud, they didn't, and developers found ways through it, no matter what. And so that's really what it's about. It's like a game of bumper cars, right? You got to make sure they stay within the ring of what's safe. And, especially in this day and age of the security requirements that are out there, it's more important today than ever before. >> Jason, can you share some data around some observations that you've noticed on trends around industry uptake or is there any patterns in terms of the customer base? Obviously, people aren't going to going to cloud operations. Just, Ginni mentioned 60/40, 80/20, the ratios. What does that all mean? And, just share the trend data around adoption and patterns? >> Probably the biggest onE in there, is the 80/20, right? That there's still 80% of the applications left in the world are still locked behind the brick and mortar. That's probably our biggest piece of our opportunity, and providing clients with a way to lift them up and be able to modernize them. I think is where the huge opportunity is. But then looking at where do they land, it's not all going to public cloud, right. So private cloud it's a huge business. I think a lot of us underestimated how large that business really is, and depending on the industry, you'll see 50/50, 60/40, 40/60 split, depending on the regulations within that industry, that country, the geography, of where they really want to go to. And, a lot of our clients are asking us for solutions around that private side, but yet be able to have the flexibility to be able to-- >> So you're seeing friction on the public cloud, mainly that's inherent from either regulatory compliance, or just technical challenges. Is that kind of the vibe? >> That's probably the first one. I think there's still that regulatory requirements of data residency, and how do I get my data to application. I can build all the applications I want in the cloud, but how do I get my data there? How do I synchronize it? My lineage of my data. So they really challenged her on that. But, then on the other side of it, is around the cost, right. And, if you wanted to rebuild all of your applications, as true cloud native, from scratch. It will take you a very long time and be very, very expensive. And so, there's also a cost element and speed. You can modernize something much more quickly, and be able to get it to that same level of service, without having to start over. >> We had Arvind on earlier, yesterday, and I want to get your thoughts on the impact of the Red Hat acquisition news, because if you look at what Open Shift is doing with Cloud Private. Arvind was saying yesterday that, Arvind Krishna, he's like, this is really enabling a lot of the acceleration for the modernization of the new cloud stuff, and keeping the legacy stuff and/or transition out on different timetables. Your thought on that? >> Absolutely right, Open Shift is going to be a critical component for our overall hybrid strategy. I'm very excited about it and really looking forward to it. And, Cloud Private and the services that I talked about, run in Open Shift today. That was part of our partnership agreement. I think that you guys were at, that Arvind talked about at that time. But, it provides the platform, for all of those traditional applications, which we've modernized. And the interesting thing is that we've actually modernized ourselves. We've modernized our middle-ware. We've modernized some of those products that are you know, 10, 20 years old. Everything from WebSphere, to MQ, to BPM. They've all been modernized in that same fashion. >> Yeah, Jason, speaking of modernization. Bring us inside you're sales force a little bit. How do they keep up, and what's the skill set that you're looking for, on your team to sell on this. You know, they need to understand Helm and Kubernetes, and all these microservice architecture, where five years ago, it was a totally different world. >> Absolutely, you know I think that if I look at a, it's not a skill, it's passion, right? It's that never give up type of mentality, I think that we look for, in a sales force and I never give up attitude really provides you with that foundation, for never stop learning, right. If anything that you've guys have noticed here over the last ten years in your guys' journey, is that this industry just changes so repidly, all the time. And, so as a sales force, you can't just acquire skills. You don't go out and hire skills. You hire people and you hire passion, and you hire people with that never give up attitude. I've been going around. We've been doing our sales kick-offs. I've done two out of the three now, so far. I tell you they are energized. They love it. They are energized about the Red Hat Acquisition. It shows that IBM really gets it. They've been telling me, does IBM really get it? And now they're like wow, we really do get it? And, they're really energized, because all of the pieces are falling into place, around this modernization, and clients, and we're hitting the timeing. >> It's time to hit that pedal to the metal, put the gas on-- >> They always say, there's no speed limit on sales. >> (laughs) Exactly. OK, first of all great, great conversation, and thanks for waiting out our journey. Stu, I would say that the salespeople got to watch all theCube videos, because all of the best content is coming out of theCube here, and great to have you on. But, quick plug, I'll give you the last word. What's the pitch, share the pitch for the Hybrid Cloud, what your team is offering? What's the, the core pitch for your customers, when you go to them? >> I think the core pitch is around modernization. It's the journey that clients are on, from application development, to how you build your apps, and how you build the microservices. How you integrate those applications, what's your API strategy, how do you move that data around securely, and then how do you manage all of those pieces together in that new modern world. And then, really looking your overall processes, and can you modernize your overall processes, add AI capabilities into that. So, it's that modernization journey. That's really what I talk to them about, and you don't have to do everything, right? Start small, start as a pinpointed piece, and we'll help you along that journey. And it becomes a journey of self-discovery, but we're there the whole way. We're a partner, that's really what it's about. >> Jason Gardner, Vice President of Worldwide Sales with Hybrid Cloud at IBM. TheCube, bringing all the data here, from IBM Think 2019. This is day three, of four days of coverage, here in Moscone live in San Francisco. We'll be right back with more, after this short break. (upbeat music)

>> Live from San Francisco it's the Cube, covering IBM Think 2019. Brought to you by IBM. >> Welcome back to Moscone North. You're watching the Cube's live coverage of IBM Think 2019. This is day three of four days of coverage. I'm Stu Miniman, my cohost is Dave Velante. We've been talking so much about multi Cloud this week that a pineapple express has hit San Francisco, heavy winds and rains but we're safe and dry inside. They're handing out ponchos and making sure that everybody can still at all the information that they have. Happy to welcome back to the program Bala Rajaraman, who's an IBM fellow and vice president with the IBM Cloud Group. Bala, thanks so much for joining us. >> Very nice to meet you. Very nice to meet you guys and thank you again. Very good to see you guys. So, it's always, and I mean this, an honor to be able to talk to the IBM Fellows. I've had the pleasure of working with a number of IBM Fellows, and, of course, we've had many of them on the Cube. It is not just an honorific. It means you've done the work, you've been with IBM for more years than we'll mention on camera. >> (chuckles loudly) >> I did protect you there. But, Bala, we had you on the program a year ago, I think. Give us the update as to what you've been working on and, as we're speaking right now, the IBM research, the key note is going on and I love the connection between what happens at IBM in some of the, you know the pure research, what happens at universities and that funnel of innovation that happens through the company. >> Oh, that's a great question. I'm glad to be back here and it's been a fairly eventful year as you guys know. I worked on our public cloud, we worked with a lot of clients, and we looked at kind of the dynamics of the market, and what is the transition to take advantage of Cloud technologies and there was certain, not just barriers, but certain opportunities in terms of looking at things like private cloud, and you guys have done some really good work on some of the research there. So, private Clouds became a point of focus for me and over the last year, working with a lot of clients the notion of hybrid became really important. And hybrid is not just a Cloud structure it is how you actually build applications on top of it. So, when you look at some of the announcements around things like Watson everywhere it is not driven by just having Watson in different places but the use cases it addresses. So, things like manufacturing where you're bringing more intelligence to the edge, to the manufacturing floor, but you take advantage of big data analytics on the Cloud. How does that work together? How do you address a lot of the technical movements of data, etc. And so that was really the great opportunity and insights that we saw and that drove our multi Cloud and public Cloud strategy. >> You bring up a really good point. I mean, the application is, you know, it's the reason why infrastructure existed, is to run the application and the data's important and I think back 10 years ago, it was like, well, am I going to burst applications? Are they going to stretch between them? And the dialogue has changed quite a bit. It's now with micro services architectures. It's not that my application's spread, it's that pieces of applications could live different places. They can live in a multi Cloud, I sometimes might be splitting it up into geography or time. So, IBM has strong ties, it has lots of applications that deliver, and working in all of these developer micro services environment. Tell us where the work's happening and what you're hearing from users? >> You know, it's a really good question. So, I think we really see three movements here. We accept the fact and the market has validated it in terms of hybrid Cloud, which is, you got pieces running on Prime, you have pieces running on the Edge, you got pieces running on one or more Cloud providers. So the hybrid multi Cloud landscape is really a preferred architecture. But that architecture also brings complexity, and the three dimensions of complexity that I see are one, around programming models and integration. How do all of these components integrate together from a programming perspective? Because you choosing different Clouds for different reasons and how do those capabilities integrate together? The second element is data. You got data moving to different Clouds, you got compute moving to data. How does data governance, how does data integration work? And Rob Thomas talked a lot about some of our different shaders there. The third element is managing the environment from a security perspective, from a compliance perspective, from a configurational consistency perspective, from an upgrade perspective, from an availability and monitoring per... These three dimensions and the amount of work we're doing in that context, not just in terms of the existing portfolio around integration, but when you look at the complexity of micro services, a number of entities, you really start bringing in elements of AI into the discussion. So, how do you enable operations with AI? How do you enable data placement, categorization, governance with AI? So, it is, even thought it might seem like different technologies, I think bringing them together just to solve this problem is perhaps one of the most exciting things that we can provide to the market. >> So, Bala, when it was becoming clear that public Cloud was going to be a force, way back when, people with large estates on Prime started talking about Hybrid, we use that term now, maybe they didn't use it then, but the notion, as Stu was describing, that you'd have some parts of the workload in public, some parts in private, maybe there's bursting. This was long before Edge and the ascendancy of micro services and Docker and Core OS and the like, and then it became pretty obvious to a lot of users, wow, this is really complicated and the use cases just don't warrant the business case. So, these things have changed. We've seen the ascendancy of these other services. You just laid out three complexities, the programming models, the data movement, which is huge, and then, how do you manage all that? So, how are the use cases evolving? Is the business case more compelling now, today, than it was, say 10, 12 years ago? >> Yes, and I think that's a really, really good question because it takes the problem to the next level. The need for Hybrid always existed. It was impractical to look at very, very large complex workloads, transactional needs, to say that there is a one solution fits it all, I can move it somewhere. I think expanding and taking advantage of different Cloud capabilities is much more of a realistic scenario and a more pragmatic, cost effective, and it meets many of the business cases. >> And that's how we got to the 20 percent though-- >> Exactly. >> Which (mumbles) would call a chapter one. >> Yep. So, now we have chapter two. Now, why is chapter two realistic? Your question was very apropos, meaning that there's complexity, and when you open up the aperture to more choices the complexity expands exponentially. What has been really central to it, has been the notion of what degree of consistency can I get across all of these elements? And open source, the emergence of things like containers and Kubernetes, not just from a run time perspective, but from a manageability and orchestration perspective, and giving you a foundation against which the consistency that it can take advantage of, is been the fundamental revolution over the last two years, which has made that intractable problem that we had with multiple choices and the complexity therein to become much more feasible. And so, if you look at our strategy underpinning those three dimensions of programming models and integration, data and management, which are not complexities but realistic needs for enterprises to take things into production. The notion of an underlying open, multi Cloud hybrid platform based on technologies like containers and Kubernetes and orchestrating across that is the fundamental transformation that has happened. And that is the exciting part. If it's open you create an ecosystem, you really address enterprise concerns from how do I build stuff in a consistent way and leverage skills in the market to all the way, how can I manage it to production goals and security goals. I think we are on the cusp of something that can really transform the way enterprises build applications, and that's what Jenny was mentioning when she said that we are very well positioned to take advantage of the Hybrid transformation and the markets behind it. That is the technical underpinnings of why we think we can do it. >> I'm glad you brought up ecosystem because it's vitally important and you've got a few larger companies, I mean wouldn't it be nice if we just say, "Oh, I'll just use one cloud?" well, that's not going to happen. That's not practical. You'd love it to be IBM's cloud, Amazon would love it to be their cloud. It's just not going to happen. So, you have this complexity. Ecosystem is critical. You've only got a few companies that really have the resources to deliver what you described and to attract the ecosystem. So, specifically, can you talk about the ecosystem and how that's evolving, from IBM's perspective? >> So, we're just peeling the onion, and I think we're going through a good progression. When you look at development of an ecosystem, the ability to provide choice to an enterprise, and the foundations on which the ecosystem is built is very critical. Now, if you look at the history of ecosystems it's been built on certain standard programming models, a certain APIs, so, Arvind keeps talking about things like TCPIP was the foundation of why the internet became a platform. So, in a similar vein, when you look at things like Kubernetes, the open standards around it, the ability through all of these orchestration and run time capabilities to create a variety of choice, and the set of choices work together and can be managed together. That is going to create an immense ecos... We are already seeing pieces of it, right? I mean, Kubernetes is becoming a model in which many providers are providing the same component across different clouds. You see the the adaption of Kubernetes across different clouds. So, rather than looking at an individual part of the ecosystem, it is how can we create a broad ecosystem based on open standards, open capabilities, interoperable standards, whether they are formal standards or they are de facto standards. That is what is exciting about this environment. >> And you're essentially saying that Kubernetes is sort of that analog to old reliable TCPIP here, or is that-- >> Yes, to a certain extent. I mean, I think if I combine TCPIP, HTTP, DNS, how things work together, how things can be managed together, you're moving up to the next level of coherent standards across every provider. And that set of standards, the things that made the internet work, Kubernetes makes applications work. So, networks work together, now applications work together and data works together, which is really nice. >> That a rat hole, Stu, but those are largely government funded standards, which, after a while, dried up because people said, "Okay, hey, we're there," and now you got open source as the sort of new-- >> Open source is the engine for innovation, and I think it's a circuitous way to get to that pithy phrase that says, "Open source is the engine of innovation." but that is really the progressive logic that gets you to the fact that it's important. So, Bala, if we have a solid foundational layer one of the things, if I think back in my career 10 years or even 20 years, things like automation and intelligence in my environment, we've been talking about it for a long time. Can you explain why now, 2019 is different and how some of these are actually coming to reality more than some of the efforts we've done in the past? >> That's a great point because there are two interesting trends that are happening. One of them is, the ability to build intelligent systems at scale is being enabled by the cloud. You have the emergence of standard platforms. Now it becomes an application game, which is how can I leverage the scale, the availability and the models of innovation to solve really tricky problems? Whether it is supply chains that are globally distributed or enterprises that need survivability in different ways, all the way from the Clouds to the Edge, what other new architecture is possible? But this distribution's also caused complexity, and when you have complexity you have to bring some of these new technologies into play, like AI and so on and so forth, and so, the combination of these three events, Cloud, the emergence of open standards that span multiple Clouds, and the complexity it creates, but the answer's that complexity that also have emerged, to me, is a very critical point for innovation. I think the landscape is going to look completely different going forward. >> And I don't think you had the business case for automation, right? Do you remember people were afraid of automation. It's like, "Well, why should we really do this? "We can handle this manually," but today, with digital transformation, data, machine intelligence and the Cloud you can actually make a significant business case to transform your business and drive competitive advantage that you couldn't make 20 years ago. >> You have no choice but to look at automation-- >> I think that. >> Because the scale and that everything's there. >> And go back to the notion of micro services. You're taking something that you could fence and you could apply certain prescriptive measures to keep it under control, now you have micro services, you have SAS systems, you have data that is being dispersed, you have computing that's being dispersed. The only way to take advantage of that agility is to create a different level of being able to understand the systems, secure the systems, and that is going to be driven by new technologies, completely new technologies. >> Alright, so, Bala, you mentioned one of my favorite words, innovation, so what are you seeing in the cloud, both from IBM, from your customers, from your partners, where is that incubation for some of those next trends, you and I, if we were prepped from this, thinking about Bell Lev back in the day or the space race, where do we get those ancillary innovations that help transform industries? How will Cloud impact that? >> I think there's two interesting questions there. One is how will cloud impact innovation, but more importantly, how will innovation impact cloud? Right, and both of these directions are important. So, Cloud really gives you the ability to Cloud, and, again I look at Cloud as, kind of in quotes "Cloud" because it includes a variety of easy access to resources, the open source innovation, the ecosystem that gets built, all of them are drivers of innovation. And it gives a way to easily exploit that innovation. I see that as the fundamental value of Cloud. Now, the interesting part is there's a bunch of other innovations, whether you look at the Debater from Watson, or you look at quantum technologies, you look at some of the Watson capabilities around conversation. How do those start transforming existing processes? So, when you look at, for example, to me one of the exciting things about Debater is when you can process incredible amounts of information, not only to provide insight but to provide rational insights and rationalizable insights. It is a tremendous innovation. Can that be applied to topics like why is my network having a problem? And can you actually debate with a system to isolate the problem? The amount of possibilities, when you look at those, how they transform, how you run your Clouds, how you run applications in the Cloud, how you work across the ecosystem, I think there's a tremendous amount of potential. And I think obviously, with things like quantum solving a different class of problems, making it easily accessible, solving different kinds of security issues, the potential is... The accessibility to innovation, with the innovation, and how it impacts the foundation that delivers that innovation. I think there's a great marriage right there. >> Bala, I want to give you the final word, lots going on here at IBM, we'd seen a year ago, we were five or six different shows pulled together, we're here at the renovated Moscone Center, thousands of people walking around, going to so many different sessions, diversity. Give us a key take away that you want people to have when they walk away from IBM Think 2019. >> So, to me, the two key take aways are one, your observation that everything is coming together is really symptomatic of the change in IBM. We are bringing things together to address complexity, make complexity simple for our clients, to bring innovation to our clients. So that's number one. And that has to be done in an open, in an ecosystem across, not just providers, but across a whole, not only a partnership but a resource ecosystem, a open source ecosystem, and the drivers of innovation that we are participating in and how we are going to influence that is something that I look forward to as well. So that's the combination. >> And it's got to be done through code. I mean, it can't just be services and I know IBM knows this, right? >> Oh, yes. >> It's built this company, this recent chapter on top of services, but that's a huge opportunity for IBM, to take its deep industry expertise, codify it through software and code, and deliver on that vision. This is an enormous opportunity. >> Exactly, and the opportunities for code are great because now it's really transforming what new code, what is the potential of code in this ecosystem. >> Well, Bala, really appreciate you coming back, sharing your body of effort that's happening to help pull together and help simplify this multi hybrid Cloud environment. >> Great, thank you very much, guys. >> Great to have you again. >> Thanks. Alright, and we're here for another two days helping to break down all the complexities, go through the nuances, speak to the thought leaders, the customers, the partners. Dave Velante is my cohost for this segment. John Furrier's here, Lisa Martin's here and I'm Stu Miniman, and as always thank you for watching the Cube. (music)

>> Live from San Francisco, it's theCUBE. Covering IBM Think 2019. Brought to you by IBM. >> Welcome back to Moscone North, this is IBM Think 2019. You're watching theCUBE, I'm Stu Miniman, and we're going to dig into a segment talking about the cognitive enterprise. And helping me through that, I have one returning guest and one new guest to theCUBE, so furthest away from me, the returning guest is Jesus Mantas, who is the managing partner strategy for the digital platforms and innovation in the IBM Global business services. Jesus, welcome back. >> Thank you >> A little bit of a mouthful on the title. And Mani Dasgupta, CMO of the same group, the IBM Global business services. Thanks so much both for joining us. Alright, so cognitive enterprise. We're going to play a little game here first. Buzzword Bingo here, you know, can we talk about, what cognitive is, where you can't say AI, ML, platform, or enterprise in there. So do we start with the CMO first? >> Sure, I can go. Cognitive enterprise, those are two bing bing right there. What's your core competitive advantage, is what I would say. As a company, do you know why you exist? And once you get to that, how do you then take it to your clients, in a way that would help you grow, and sustain growth in the future. That truly is the future of a smart business, what we call the cognitive enterprise. >> So, Jesus, data is something we talk about a lot, at all the shows, we hear all the tropes about it's the new oil, the rocket fuel that are going to drive companies. You've got strategy and innovation in your title, I'd love you to build off as to where this cognitive enterprise fits in to those big trends of AI that we were talking about. Jinny was just on the keynote stage, talking about Watson, talking about all those pieces, so where does that fit with some of these megawaves that we're talking about. >> I think it's the way that we define this new, smarter organizations that use data to the fullest extent. And I think the way that we define it is, one is this reuse of data, your own data, the external data, and the way you aggregate it, the way that you apply AI or other things to use that. But the technology itself is a means to an end, it's not the end, so these organizations change the way the work flows, and they also train people to make sure that they understand how to operate in a world where they have more information and they can make better decisions with that data that they could before. All of that is what we are labeling. It's more than digital, it's more than AI. It is this concept of a cognitive enterprise. It's a smarter way to do what a company does. >> Okay, I'd love if you could give us a little bit of a compare, contrast. You know, the wave of big data was, there's massive amounts of data, we're going to allow the business practitioner, to be able to leverage that data. Was a great goal, unfortunately when we did research, at least half the time it wasn't really panning out there. Doesn't mean we didn't learn good things, and there weren't lots of great tools and business value generated out there. So, give us, you know, what's the same and what's different, as to this new wave. >> This is how do you make that data work for you, really. It is about, when you talk of data, you think of data that's out there, but 80% of the data today, is owned by you. And by you, I mean a business, right, you own your customers' data, you know your customer better than anybody else. So what do you really do with it? And we are at an inflection point right now, where these technologies that you just talked about, be it blockchain, be it internet of things, be it AI. You can truly bring the power of these technologies, to start making sense of that data that you own, and use it to create, what we call, your competitive advantage, your business platform. So, think about it, I can break it down. Would you just be a retailer of clothes? Or, would you be a fashion expert? And which one would have long-term success for you? Or if you think of a completely different industry, would you be an insurance provider, you sell insurance products, or would you be a risk management expert? That decision to be who you want to be, is really at the heart of the cognitive enterprise, and what we are proposing to the clients here. >> Alright, help frame for us your group, where that fits in. IBM sells hardware, software, has a huge services organization. What are the deliverables and the services and products involved in your group? >> Sure, we are the services organization of IBM, and one of the core reasons why we exist is to help our clients solve their toughest business problems. And so, if you think about it, you think about it as different puzzle pieces, but they don't quite always fit together. We exist to sharpen the edges, to sometimes round the edges, make it customized, make it right for you, so that at the end of the day, you're able to deliver results for your customers and be closer to them than ever before. >> The balance we look at in this multi-cloud world, it'd be nice if you have a little bit more standardization, but of course we know when we talk with businesses, every company is different and is challenging. So, where are the architectural engagements? What are the design criteria? Where is some of the hard work your group gets involved in? >> Yeah, I think we've been spending a lot of work and a lot of time on understanding how to get clients, most clients have done a lot of experimentation. But they rarely figured out how to get that experimentation into real production, at scale, with impact. So that's where we've spent a lot of the time. Fundamentally it has to do with, not only understanding Agile as a method, but being able to combine that with taking that journey all the way through to production, actually integrating with compliance requirements that, if you're in a regulated industry, you have to do, and do that in a way that doesn't become a digital island. I think what we have learned is, when companies see this big divide between, that's the legacy world and that's the new world you can never put those two together. So we came up with this concept of IBM Garage, which is the way in which our team, the services side, can actually bring it all together, and it gets massively enhanced and improved, with technology like containers, like Kubernetes, because now you can actually open up architectures, without reinventing them, and connect them with new technology, and do that synchronously. So you can basically be modernizing your legacy, you can be creating new innovation, in the form of new platforms, but you can do it at the same time, and as you do that through cycles, you also change the skillsets that you have in your company, because if you don't change that skillset, you're always going to have a problem scaling. That's what we do, that's what we help the clients do. >> Yeah, skillsets are so critical. Something we've been hearing over and over is, that whole digital transformation, this isn't some 18 to 24 month going to deploy some software, bring in a lot of consultants, they go and do it, hopefully it works and then they walk away. We're talking about much faster time frames, usually agile methodology, talk about skillset-changing. How do we help customers move fast and accelerate, because that's really the faster, faster, faster, it's just one of those driving things we hear. >> I was talking to one of the clients this morning, and what she said is, it's so helpful to have a framework, just to know where to start, and also to know, sometimes it's there in their mind, but they want to see it in front of them, how to break a problem down into smaller components, so that you can get to value faster, so we have actually a seven-step process, of the cognitive enterprise. So we start with, what is your core platform? In fact, Jesus coined this term, he calls it the digital Darwinism. Do you want to talk about the digital Darwinism, Jesus? >> Yeah, I think it reflects very well this urgency. In the analog world when most businesses are based on how clients choose you based on proximity, based on convenience, based on brand, based on trust, based on price. Even if you're not great at it, you have enough friction in an analog world, that the clients will keep coming. All of us and more of our things that we do every day, are in our phone, and they are digitally accessible, all of that friction disappears, and what happens then is, the people that are very good at something becomes, everybody goes to them, and the people that are not the best. I call it, they either thrive or they die very quickly. So in the digital world, being really good at something is a lot more important than in the analog world. You can survive being average in the analog world. Once you get to the digital world, it's transparent. Everyone will know, you're the best, you're not the best, and nobody would pick you if you're not the best, so it's really important to reconfigure yourself, and understand the trust and your brand, understand how digitally you translate what you are, and then make sure that your clients will keep choosing you in a digital world as much as they were choosing you in an analog world. >> I tell you, that resonates really well with me. The old line you used to hear is, if you want to get something done, give it to someone who's really busy, because they will usually figure out a way to do it. I spent a handful of years in my career doing operations, and what I did when I was in operations, when I talked to people in IT, is tell me next quarter and next year, do you think you're going to have more or less work more data to deal with, more thing thing, and of course the answer is, we all know that pace of change is the only thing that's constant in this industry. So, if I don't figure out how I automate, change, or get rid of the stuff that I'm not good at, we're just going to continue to be buried. Are there commonalities that you see, as success factors or how do you help measure, what are some key KPIs that customers walk out of, when they go through an engagement like this? >> Yeah, just carrying on from where Jesus left off, the second step is very close to what you were just saying. It's about the data and how you're using that data. So some of the key success factors would be, what is the output of it, and it's not in the proof of concept phase anymore. It is real-time, it is big, people are doing it at a grand scale. I think, Jesus, maybe we take it through the seven steps, and then the key success criteria comes right at you, right after that. So after you do the workflow, after you do the data for internal competitive advantage, we go to the next step, which is all about workflows. You want to talk a bit about that? >> Yeah, I think one of the advantages that artificial intelligence brings to companies is, the fact that you can now, I mean as a human, there is only so much data that you can ingest. There is a limit, and most businesses try to optimize what that is and how you make decisions. But, artificial intelligence becomes this aid that will read and summarize things for you. So now you can take into account, into workflows, massive amounts of information, to optimize, or even not having to do things you had to do before, at a scale that, as a human you cannot do. This idea of inserting AI into workflows is the real idea. I think we talk a lot about AI as a technology, but that's just a means to an end. The end is a workflow that is embedded with blockchain, with AI, with IOT, and then people that are trained to engage with those workflows, so you actually change the output. And I think that's the big idea, that step of, it is workflow that is embedded with AI, it's not just about the technology, it's the combination of the main industry, and the technology that actually creates that >> And where does it sit, right? Where does it sit? Your tech choices, the architecture choices are also important. And we joked about this, like if you really like Netflix, and you're watching something and something is coming up after three seconds, how does it know what you really like? But it does, but think about this. This wouldn't be possible on a 1950s television set. So you've got to think about what's your tech platform of choice, how do you upgrade that, and what's the architecture look like? >> I want to give you both the final word. Lots of users here at the show. What are you most excited about? Give us an insight on some of the conversations you've been having already. >> Amazing conversations so far. The really aha-moment was, people really like to share within their peer set, so this morning I was at the business exchange, and people were having conversations, but just to bounce it off someone, who is facing the same issues that you do, across different industries, was a really aha-moment, and we have the IBM Garage actually right behind us on the other side of Moscone. We set it up so that clients can come in, and unpack their problems, and we helped them think it through, used design thinking, help them think it through. We are hoping in the next couple of days, we get lots of brilliant ideas, come from the sessions like that, and really putting the customer at the core of what you want to do. >> It's a recurring theme of all the client conversations, this idea of, they all want the speed and agility of a startup at the strength and scale of an enterprise. That's what they're asking us, as the services organization of IBM, to do is, help us not just experiment, that was good before, not good enough now. Help us do that with agility, with new technologies, but we want it to mean something at scale, globally implement it, create an impact. And I think again, the way in which hybrid multi-cloud can play into that, the way in which IBM Garage can combine the legacy world with the new world and moving people into new platforms is a really exciting method and approach that is resonating a lot with clients. >> Really appreciate you both sharing updates and absolutely as you painted a picture, just as in 1950 we didn't have the tools to run Netflix, now in 2019, we have the tools for customers to be able to help build the cognitive enterprise and not only test but get into real-world deployment at a speed that was really unheralded before today. Thanks so much for joining. We'll be back with more coverage here from IBM Think 2019. I'm Stu Miniman, and thanks for watching theCUBE. (upbeat techno music)

>> Live from San Francisco, it's theCUBE. Covering IBM Think 2019. Brought to you by IBM. >> Hey everyone, welcome back to the live coverage here in Moscone North in San Francisco for IBM Think. This is theCUBE's coverage. I'm here with Dave Vellante. I've got two great guests here, Carlos Guevara, chief data officer, Claro Columbia, and Carlo Appugliese- Appugliese? >> Appugliese, yeah, good. That's good. >> Engagement Manager, IBM's Data Science Elite Team, customer of IBM, conversation around data science. Welcome to theCube, thanks for joining us. >> Thanks for having us. >> Thank you. >> So we're here the streets are shut down. AI Anywhere is a big theme, Multi-Cloud, but it's all about the data everywhere. People trying to put end-to-end solutions together to solve real business problems. Data's at the heart of all this. Moving data around from cloud to cloud, using AI and technology to get insights out of that. So, take a minute to explain your situation, what you guys are trying to do. >> Okay, okay, perfect. Right now we're working a lot about the business theme, because we need to use the machine learning models or the artificial intelligence, to take best decisions for the company. We were working with Carlo and Sean Muller in order to know how can we divide the customers who leave the company. Because, for us, it's very important, to maintain our customer, to know how their behavior is from them, and their artificial intelligence is an excellent way to do it. We have a lot of challenge about that, because, you know, we have a lot of data, different systems that are running the data, but we need to put all the information together to run the models. The Elite Team that Carlo is leading right now is helping us a lot because, we know how to handle data, we know how to clean the data, we know how to do the right governance for the data and the IBM Equinix is very compromised with us in order to do that. Sofie, that is one of the engineers that is very close to us right now. She was working a lot with my team in order to run the models. Susan, she was doing a lot for our middleware, FITON, and right now we are trained to do it in over the Hadoop system, running the spark, and that is the good way that we are thinking that it's going to get the goal for us We need to maintain our customers. >> So you guys are the largest telecommunications piece, Claro in Mexico for voice and home services-- >> Yeah. >> Is that the segments you guys are targeting? >> Yeah, yeah. >> And the scope size of, how big is that? >> Claro is the largest company in Columbia for telecommunications. We have maybe 50 million customers in Columbia, more than 50% of their market share. Also, where we have many, maybe 2.5 millions of homes in Columbia, that is more than the 50% of the customers for home services. And you know that is a big challenge for us because the competitors are all the time trying to take our customers and the churn, it also adds to us, and how to avoid that and how to do the artificial intelligence to do it, machine learning is a very good way to do that. >> So, classic problem in telecommunications is churn, right, so it's a data problem, so how did it all come about? So these guys came to you and-- >> Yeah, so they came to us, and we got together, we talked about the problem, and churn was at the top, right, these guys have a ton of data. So what we did was, the team got together, we had, really the way the Data Science Elite Team works is we really help clients in three areas. It's all about the right skills, the right people, the right tools, and then the right process. So we put together a team, we put together some Agile approaches, and what we're going to do, and then we started by spinning up an environment, we took some data in, we took their, and there as a lot of data, it as a terabytes of data. We took their user data, we took their users' usage data, which is like how many texts, cellphone, and then billing data, we pulled all that together in an environment, then the data scientists, alongside with Carlos' team, really worked on the problem. And they addressed it with machine learning obviously, targeting churn, they tried a variety of models, but XGBoost ended up being one of the better approaches. And we came up with pretty good accuracy, about 90, 92% precision on the model. >> On predicting-- >> On predicting churn-- >> Yeah, churn, and also, what did you do with that data? >> That is a very good question because, the company is preparing to handle that. I have a funny history, I say to the business people, okay these customers are going to leave the company, and I forget about that, and two months later, I was asking okay, what happened, they say okay, your model is very good, all the customers goes. Oh my God, what is happening with that? They weren't working with information, that is the reason we're thinking that the good ways to think from the right to the left, because which is the purpose, the purpose is to maintain our customers, and in that case we lose 50,000 customers because we didn't do nothing. We are close in the circle, we are taking care about that, prescriptive models to have helped for us to do it. And okay, maybe that is an invoice problem, we need to correct them, to fix the problem, in order to avoid that, but the first part is to predict, to get in a score, for the churn, and to handle that with the people. Obviously, working also, at the root cause analysis, because we need the churn to fix from the root. >> Carlos, what goes through the scope of, like, just the project because, this is a concern we see in the industry, I got a lot of data, how do I attack it, what's the scope? You just come in, ingest it into a data lake, how do you get to the value of these insights quickly, because obviously they are starving for insights, take us through that quick process. >> Well, you know, every problem's a little different, we help hundreds of clients in different ways, but this particular problem, it was a big data problem, we knew we had a lot of data, they had a Hadoop environment, but some of the data wasn't there. So what we did was, is we spun up a separate environment, we pulled some of the big data in there, we also pulled some of the other data together, and we started to do our analysis on that, kind of separately in the cloud, which was a little different, but we're working now to push that down into their Hadoop data lake, because not all the data's there, but some of the data is there, and we want to use some of that computing network to-- >> So you had to almost do an audit on those, figure out what you want to pull in first, >> Absolutely. >> Tie it to the business, on the business side, what were you guys like? Waiting for the answers, or like, what was some of the, on your side of the process, how did it go down? >> Thinking about our business, we were talking a little bit about that, about the architecture to handle that, ICP for Data within that is a very good solution for that, because we need infrastructure to help us, in order to get the answers because finally, we have a question, we have questions, why the customers are leaving us. And, the answer was the data, and the data was handled in a good way, with governance, with data cleaning, with the right models to do that, and right now, our concern is business action, and business offer, because the solution for the company is that we, obviously new products are coming from the data. >> So 10 years ago, you probably didn't have a Hadoop cluster to solve this problem, the data was, maybe it was in a data warehouse, maybe it wasn't, and you probably weren't a chief data officer back then, you know, that role kind of didn't exit. So a lot has changed, in the last 10 years. My question is, do you, first of all, I'd be interested in your comment on that, but then, do you see a point in which you can now take remedial action, or maybe even automate some of that remedial action using machine intelligence and that data cloud, or however else you do it, to actually take action on behalf of the brand, before humans, or without even human involvement, did you foresee the day? >> Yeah, so, just a comment on your thought about the times you know, I've been doing technology for 20 something years, and you know, data science is something that's been around but it's kind of evolved in software development. My thought is, you know, we have these roles of data scientist, but a lot of the feature engineer and data prep does require traditional people that were DBAs and now data engineers, and a variety of skills come together, and that's what try to do in every project. Just to add to that comment. As far as predicting ahead of time, like I think you were trying to say, what data, help me understand your question. >> So you've got 93% accuracy, okay, so, I presume you take that, you give it to the business, business says okay, let's maybe, you know, reach out to them, maybe do a little incentive, or, what kind of action can the machines take action on behalf of your brand, do you foresee a day when that could happen? >> Ah. >> Ah, okay. >> Yeah, so my thought is, for Claro Columbia and Carlos, but obviously this is, to me, remain, is the predictive models we've built will obviously be deployed, and then it would interact with their digital mobile applications, so in real time it'll react for the customers. And then, obviously, you know you want to make sure that Claro and company trust that, and it's making accurate predictions, and that's where a lot more, you know we have to do some model of validation, and evaluation of that, so they can begin to trust those predictions. I think is where we're-- >> Guys. I want to get your thoughts on this because you're doing a lot of learnings here. So can you guys each take a minute and explain the key learnings from this, as you go through the process, certainly in the business side, this is a big imperative to do this. You want to have a business outcome that keeps your users there. But what did you learn, what was some of the learnings you guys got from the project? >> The most important learning from the company was cleaning the data, that sounds funny but, as we say in analysis, garbage in, garbage out. And that was very important for us, one of the things that we learned, that we need to put cleaning data or the system. Also, the governance. Many people forget about the governance, the governance of the data. And right now we're working, again with IBM, in order to put that governance soon. >> So data quality problem. >> Yeah, data quality. >> And, do you report into I guess, COO or the CIO, are you a peer of the CIO, how does that work? >> Oh, okay, that's another funny history because, because the company is, right now I'm working for planning. Yes, it's strange, we're working for planning for the company-- >> For business planning. >> Yeah, for business planning. >> I was coming for an engineer, engineering, and right now I'm working for planning, and trying to make money for the company. You know, that is an engineer thinking how to get more money for the company. I was talking about some kind of analytics that is geospatial analytics, and I went to see that engineer to know how their network's handling, how the quality of the network and right now introducing the same software, the same knowledge, to know which is the better points to do sales. It's a good combination where finally I'm working for planning, and my boss, the planning chief, is working for the CEO. And I hear about different organizations, somebody's in financial, the CDO's in financial, or the CDO for IT, it's different, it depends on the company. Right now, I'm working for planning, how to handle the things, how to make more money for the company, how to handle the churn, and it's interesting because all the knowledge that I have from engineering is perfect to do it. >> Well, I would argue that's the job of a CDO, is to figure out how to make money with data, or save money, right? >> Yeah. >> Yeah, absolutely. >> So it's number one, anyway, is start there. >> Yeah, the thing we always talk about it is, is really proving value, it starts with that use case, identify where the real value is, and then we can, you know, the technology can come and the development can work after that. So I agree 100% with that, is what we're seeing across the board. >> Carlos, thanks for coming in, largest telecommunications in Columbia, great customer reference. >> Carlo, take a minute to explain, real quick, get a plug in for your Data Science Elite Team. What do you guys do, how do you engage, what are some of the projects you work on? >> Right, yeah, so we're a team of about 100 data scientists worldwide, we work side by side with clients, and our job is to really understand the problem from end to end and help in all areas, from skills, tools, and technique. And we roll and prototype, in a three Agile sprints, we use an Agile methodology, about six to eight weeks, and we kind of develop a real, we call it a proof of value. It's not a MVP just yet, or POC, but at the end of the day we prove out that we can get a model, we can do some prediction, we get a certain accuracy, and it's going to add value to the organization. >> It's not a freebie, right? >> It actually is-- >> Sorry, I'm sorry. It's not a four page service, it's a freebie, right? >> Yeah, it's no cost. >> But you got to-- >> We don't like to use free, that's what-- >> But, you got to be saying-- >> It's a good lead. >> Good to discuss that-- >> Well, we don't charge, but >> Largely. >> But it, but it, it's something that clients can take advantage of, if they've got an interesting problem, they're potentially going to do some business with you guys. >> Absolutely. >> If you're the largest telecommunication provider in the country, you get a freebie, and then, the key is, you guys dig in. >> We dig in, it's practitioners, real practitioners, with the right skills, >> Yeah. >> Working on problems. >> Great sales model. >> By the way, Claro Columbia's team, they were amazing in Columbia, we had a really good time, six to eight weeks, you know, working on a problem, and those guys all loved it too, they were-- >> Thank you. >> Before they knew it, they were coding in Python and R, and they had already knew a lot of this stuff, but they're digging in with the team, and it came well together. >> This is the secret to modernization of digital transformation-- >> Yeah. >> Is having the sales process is getting, co-creating together-- >> Absolutely. >> You guys do a great job, and I think this is a trend we'll see more of, of course, TheCUBE is bringing you live coverage here in San Francisco, at Mascone North, that's where our set is. They're shutting down the streets for IBM Think 2019, here in San Francisco. More CUBE coverage after this short break, be right back. (energetic music)