>> Illustrator: From around the globe, it's the cube with digital coverage of PagerDuty summit 2020. Brought to you by pagerduty. >> Welcome to the cubes coverage of PagerDuty Summit 2020, the virtual edition. I'm Lisa Martin, and I'm pleased to welcome the Senior Vice President of Product for PagerDuty. Jonathan Rendy. Jonathan, welcome back to the cube. Thank you, Lisa. It's great to be here. So this is our virtual cube, virtual summit 2020. But one of the things that I know from talking with Jennifer yesterday 6is that this is the opportunity to reach way more people because there's, you know, no travel restrictions and budget and things like that. But one of the things that is quite impressive is that you're going to be in your keynote talking about a lot of changes and enhancements to the products the biggest release in pagerduty's History During COVID-19 really impressive. Talk to us about why this is such an exciting time. >> Well, it's it's exciting for a lot of reasons. And great to be here, although I'm getting so tired of working from home these days. But be that as it may, yeah, we we do have the biggest set of releases and investments and innovation that we're unleashing in the history of the company, which in these times is is no small feat. I want to thank all the teams have done a wonderful job. But we're using our summit event, as you know, to to talk about that to bring that out to discuss and we have some very high profile speakers coming. Joining us at the event. We have Andy Jassy, we have Eric Diwan, Stewart Butterfield and more. So it'll be a fantastic event, for executives and for practitioners alike. So sharing what we're doing new with all of this, these leaders joining us is going to be a great thing. >> One of the things that's become so critical in the last six months is digital services. And I think so many of us don't realize or don't think about the folks under, I don't want to say under the hood, but behind the scenes really, that are critical for you mentioned, the CEOs of AWS and zoom, and Slack, which are all essential. I mean, zoom is a household name, right? My mom even uses zoom, she's 75 that's pretty cool. But all of the criticality under the hood to ensure that these services continue because we're all now even more dependent on them than we ever have been before. >> Yeah, it's really interesting, I was thinking about this the other day, there were so many casual services that we all relied on, you know, pre March pre February, that now have become just mission critical and, and to everything that we do professionally and personally. And to your point, whether you're working out at home with, you know, your peloton, or whether you're in the two dimensional world with zoom all the time, we just expect all these services to be up and running and be available for us. And behind all those services that we expect to be there is a an amazing amount of complexity and dependencies. And behind all those complexity and dependencies our people and and that's a big part of what PagerDuty focuses on which is engaging people on the right issues at the right time. And of course, allowing them not just to be engaged but complete the work work, major issues, unexpected work, unplanned work, and complete all that in when moments and seconds and microseconds matters. So Pedro duty has a unique place in that whole ecosystem of what's considered crucial and critical now. >> We'll we've been hearing the term essential workers for since March right and thinking of them in a traditional sense of doctors and nurses and firemen and obviously grocery workers and, and deliver companies. But looking at it from pages through your lens, it's this the whole like digital frontline, the DevOps folks, the IT folks, the customer support folks who are really on the front lines of helping that brand be protected. Now it's, you know, the fact that everything is real time that now is now more important than ever is never been more important. So talk to us about sort of this switch to this digital default and what that means for operations. >> Yeah, as we were just saying, to your point, it's never been the services have never been more important and more essential to everything that we do. So it just makes perfect sense that all of the individuals who are responsible for building and delivering and supporting those services are essential. Now also and as a part of that we talk a lot about going from what everybody knows as DevOps to digital ops. And while it may sound like a marketing phrase, words matter, and it really means going from being responsive to being proactive and predictive. And that's so important for these individuals. To get ahead of this, we've seen super interesting data, when we look at our platform where there 13,000 customers of how life has changed for all of those customers and those half a million users of our platform today, pre COVID. And now that we're in the middle of this with, again, reflecting how important services are the increased use of those, and then the rise in issues. And what's the great news is that individuals and companies using the platform are actually getting better at addressing them than they were pre COVID. So with the bad news, there's, there's good news, too. >> I agree, there are always silver linings, I was looking at my notes here. And one of the things when PagerDuty evaluated your platform, and as we mentioned over 13,000 customers, during COVID, seeing an increase in traffic and demand for digital services, more than a 38% increase in incidence compared to the prior period. But you also talked about how the big impact that pager duty is helping your customers make and resolving those incidents faster. And I guess maybe sorting through the noise, and a better more automated way. >> Exactly. And a lot of it has to do with what we've been doing. And then another piece is our new releases. And so again, we've looked at our data to your point. And we've seen this over a third rise, in the number of issues, that organizations are running into across the board. And with our new releases, we're able to reduce interruptions by over 65%. So it's great news that again, with with the rising use and the rise in interruptions and people having to context switch from what they're doing to you know, firefight and jump in the middle one and collaborate across organizations that there's light on the horizon, the light at the end of the tunnel, I should say, and then things are going to get better. And our new releases are going to help in a big way. >> Okay, I'm assuming you have a crystal ball, which is great. So I'm going to be looking for some more predictions, but talking to your customers. And you know, I can imagine now there's more noise. You mentioned this switch from DevOps to digital ops and this now this digital default that I know, Jennifer has talked about, and it's this probably going to be one of the things that that shapes the winners and the losers of tomorrow in every industry. But tell me a little bit about how you're helping how you're using, you know, the traditional buzzwords, AI, machine learning, and putting them really effectively to work so that it's now not just a buzzword that companies in any industry should be thinking about, but it's actually machine learning is going to be critical to sorting through this increased volume of data and helping resolve incidents faster to not just, you know, prevent customer churn, but also to make sure that your folks on the digital front lines aren't burned out. >> Well, with the transition that we were talking about before, you know, everybody realizes that they have to be all in now, there's no, we're migrating to the cloud. And there's reasons for that, moving from on prem systems to to the public cloud, in many ways, we've seen that massively accelerate. And with that comes and how the systems are, have to be built and managed and delivered there, you see this increasing complexity. And going back to what we were talking before, individuals are behind all of that complexity. And so it's so important that in our new releases, we really up the bar, we've really raised the game, so to speak on what we're doing to take advantage of our data that we capture. And also this increase in information that's coming in, we refer to it a lot of times as telemetry when you, you know, start to refactor and rebuild your systems in the public cloud, and you have all those dependencies and you have more information, more data flowing to you, which can translate to more interruptions. And very easy, It's very easy for organizations and teams to get overwhelmed by that. And so our new releases, focus on making sense of that we talked about the reduction in interruptions and the reduction in noise. But we've also focused equally, on helping folks with context with information when something goes south, when something is different than what a team expected. How do you fix that once you engage the right people, they're so big part of our releases also been about applying machine learning to add context to speed up fixing and resolving and finding the root cause of these issues in a big way. And we do that through a number of different ways in our in our products, in our PagerDuty platform, event intelligence, and also our analytics, again, to draw these relationships around service dependencies and our analytics, we've included a recommendation engine. So now we can show organizations and teams predict. If you make these changes, you will see these improvements. And this will be your returns and using our data combined with the data that's coming in, That's a big part of what the PagerDuty platform is all about. >> well that analytics piece is, critical as as the machine learning because the volumes of data are getting bigger and bigger and bigger such that it can't be can't depend on just humans. There's something that I'm curious about, too, is with the rise in incidents, how can PagerDuty help customers kind of sort through the noise and maybe Park things that might be able to be resolved on their own without having to escalate? >> It's a great question. And we do it through a couple of ways. One, we've applied machine learning so many times when, when interruptions when issues alerts come in, and they can look different, but they're all related to the same thing. So we're applying machine learning to better group and intelligently organize and group all of those informations into the singular incidents that really matter that you really need to pull teams together on which is important. The next thing we're doing is we're using machine learning to say, Hmm, okay, it looks like these, these issues, these incidents are happening on different services that teams own. And what we're also using the machine learning to do now is to show the dependencies between those services. So we often see situations where you can have a couple of teams in your organization, working on issues that are delivered to them, not knowing that they're related. And in some ways they can be working against each other. So having information to know that one issue is upstream. And the other issue is downstream allows one team to step forward and the other team to step back. And we're using our machine learning for that, to give that additional context and help pinpoint where the issues are. So it's the most effective use of these teams when they come in, Nothing's more frustrating by the way than being interrupted, whether it's the middle of the day or the middle of the night, only to find out that either you're being unproductive or you didn't need to be there in the first place. >> Oh, absolutely, yes. And I'm seeing some stats that people are the folks on the digital front lines are working an average of 10 hours more a week. And so many more of those interruptions are happening and when you'd like to be off on the weekends and the middle of the night. But one of the things that that you took context, absolutely critical, but also collaboration, different teams that need to be to your point, are we working on the same thing, and we don't know, the collaboration now that work is distributed is even more critical than ever? What are some of the things that you're hearing from customers about what PagerDuty is doing to facilitate that collaboration so that things just run much more smoothly, and the demanding consumer on the other end is satisfied? >> Well, to your point, one of the most critical things, since we're talking about not just a technology issue, we're talking about a people issue is communication, and collaborating. And that is so important, not only in general, but in these moments that matter. And so one of the things we've done in the new platform is we're introducing industry firsts, video war rooms, with our partners and customers zoom, as well as Microsoft Teams. And so we're also updating our slack integrations as well. But as we live in this two dimensional world, those responders, those teams that have to come together to fix issues with the single click of a button, now they can participate in those issues, in a video sense, in a video war room, but not just engage in that way. We've also added the ability to manage the issue through zoom through Microsoft Teams as a part of PagerDuty. So individual don't need to context switch from one product to another, they can do everything they need to do from from that world. So a big part of that collaboration and communication is all about the in the moment, you know, teams working together in those forums. But there's another side of communication collaboration in these major events. That's critical as well. And that has to do with what I always think of as the ripple effect. There's there are the teams working the issues. And then there are all the teams adjacent to that, whether they're business stakeholders, whether they're customer service teams, that also need to take action. They may not be fixing the issue, but they have to engage and they have worked to do they have actions they need to take equally, that are different. And so for those other organizations, it's we've increased the scalability of our stakeholder notification into the 10s of thousands. So those folks can keep in touch in tight alignment to what's happening to an issue being fixed, which, again, in today's world, this effect, affects everyone in an organization, not just the teams tasked with addressing the problems. >> Right. And of course, the demanding consumer on the other end isn't considering the fact that the customer support person that they're talking to might not have access to everything they need. And it's critical. It's business critical for any type of organization to understand that, even their customer support folks, and I shouldn't say even those guys and girls are on the digital front lines. And brand reputation hangs on the data that they have the context that they have, and their ability to resolve a customer issue because we were more demanding as consumers before COVID. And now I think even more than other because we're dependent on it. We're dependent on zoom, or dependent on Slack, we're dependent on Amazon and AWS, and so many other digital services. And we don't get what we want as consumers, right, we're going to go I'm going to go find someone else who's going to be able to respond to this in in one second, because I'm only going to give it a half a second. So last question, Jonathan for you so much announced this PagerDuty Summit 2020, unique in that way unique in the virtual asset. But what are some of the things that you see on the horizon, say, the next six months, because I'm pretty sure you have a crystal ball, let's open that up. >> Well, I see a couple of things. And while I never said that I'm Nostradamus, I see a couple of things. And one is that there is a material, seismic shift towards full service ownership. and so teams, and this was happening before as a part of DevOps. But when I was talking previously about moving to digital Ops, we're seeing large organizations have major initiatives around this notion of the frontline teams have to be empowered to work directly on these issues. And we always call that this phrase, full service ownership, which means you build it, you ship it, you own it. And that's both for development and IT organizations. And I think you brought up a really interesting point before, in this trend that I see happening and only accelerating, it's happening because people want to innovate faster. And those individuals, those teams, whether you're, again, in Dev, it Ops, or even in customer service, it's important that you're empowered to do this to help in that innovation. So I see that as the first seismic shift. And actually, as a part of that. The other big part of our announcements is where we're at summit, announcing PagerDuty for customer service. It's a curated product, just for customer service teams, because they're part of that big triangle with Dev and IT teams that they need to be in the loop, they need to be empowered with the same types of tools, they need to be able to act as a, essentially an incident commander, they have cases that come in, and they need to be able to engage the right individuals to provide that customer service to what you were saying before. And they need to have a direct link to everything that's happening in Dev and it so they can be proactive and get ahead of customer cases also. So again, to your question of, like, what do I see? I think that shift is brought on by people being all in, you know, with with their, their cloud migrations and refactoring. And then full service ownership being something that empowering individuals on the front lines, democratizing, you know, decision making and empowering those teams. I see that as the biggest shift happening overall. >> Excellent, Jonathan, thanks for sharing what you are unpacking at summit 20 and the opportunities that had a lot of silver linings. We appreciate your time. >> Thank you, Lisa. It's been a pleasure being here. >> For Jonathan Randy. I'm Lisa Martin. You're watching the cube (upbeat music)

live from Las Vegas it's the cube covering AWS reinvent 2018 brought to you by Amazon Web Services Intel and their ecosystem partners okay welcome back and we're live here in Las Vegas day three last interview of the day three days of wall-to-wall coverage two sets here at AWS reinvent 2018 our sixth year we've been at every reinvent except for the first one and it's been great to watch the rise I'm Jeff we're with Dean Volante we're here with Andy Jesse the CEO of AWS started this as it working backwards document years ago twelve years ago 12 half year zine years ago was when the document was written and we've launched 12 and a half years ago great to see you thanks for spending time I know you're super busy congratulations we met last week you couldn't really talk about it but boy there was so much more payload in the announcements than they were before are you happy with the results certainly three our keynote was taxing what's good impression when the keynote was over but ya know we're thrilled with it and most importantly the reason we're thrilled is because our customers are thrilled I think they just couldn't believe how much we delivered this week you know well over 100 capabilities and they were super excited about you know the storage announced was the thing is when you have millions of customers any announcement you make is going to be popular with thousands of customers so some people walked up to me and said oh I know it's not sexy but I love the storage announcements I needed the file systems I wanted that glacier deep archive some customers love the database releases with lots of customers that were excited about the machine learning piece and you know the another unsexy one where the enterprise abstractions just to make it so much easier for that type of builder who wants more prescriptive guidance to be able to get started quicker and then you know people are pretty excited that outpost too so it has you a question I'll talk Amazon speak now what what areas of the show do you feel you raise the bar this year on what was that what would you point to bar raising moments announcements well you know I think each year one of the things I like about reinvent and that we work hard on is we'd like to have we don't really want it to be a corporate event we wanted to be quirky and we want it to be authentic and we want you know we want our community to fit to have fun here while they also learn so you know Midnight Madness is for instance something we do every you know we've done the last couple years and we try radically different things and so I thought that Tatanka eating contest raised the bar is again this year was the second year in a row that we said again as political World Records and you know I thought I really liked Peter De Santis --is and Myrna Vogel's keynotes on Monday and today respectively I thought they both were fantastic and you know keep raising the bar are you over a year and you know so they're you know we're hoping I too will be something that people feel like raise the bar year over year what the house band synchronicity was quite good too you know yeah I tell you that that fan is terrific and you know and I think that again all those things I mentioned are part of what we you know think makes the event fun and quirky and different but the most important thing by far is the learning of the education and then our customers excited about not just the platform but we launched so many things do they feel like it helps them do their job better well while we're on the raising bar we've got a prop here this is the the deep racer deep the deep racer machine learning it's a toy for testing and the question comes up how old do you have to be to use this and I said hey if your kid can code machine learning good for them but talk about this because this is kind of interesting because it's fun but where'd this come from you know it came from last year when we release sage maker and we were making machine learning so much easier for everyday developers of scientists we said what can we do to give people hands-on experience because you learn things better if you actually try it and so we tried to help developers get more experience to computer vision by having a deep lens you know video camera and that was wildly popular and so as we were thinking about this year making reinforcement learning available as easily as we are in sage maker which we think is a huge potential game-changer grant Forsman learning the team kept thinking about it's great but nobody knows enforcement learning and nobody has experienced with it how can we give them experience what are ways they can get hands-on experience and that's how the deep racer car came up which is really making it simple where they can just give us a reward function with a line of Python strip and then Sage Maker will automatically train an RL algorithm and then they get to play it to the car and then race against one another and when we watched how competitive it was getting inside our own house on these RL infused cars racing each other we figured other people might find a compelling as well and I couldn't believe how many people participate yesterday yeah and then I don't know if you saw it three burners right before burners keynote the finals were really exciting to like the fact that there were some imperfections were actually made it more compelling to watch and so we had a racer Cup coming up - I met play 19 competitive yes that's going to happen yeah today was the accelerated version of the first ever deep racer League championship Cup but next year will be a full season at our 20 AWS summits the top winners in the in the deep racers you see bracer League races at each of those summits plus the top 10 vote getters in points from those summits will come here and compete for the championship Cup now you and I talked about a new persona last week when we met but now the announcements pretty clear now why this points to a whole new persona developer you got eSports on the twitch side booming heat sports is changing the game and in the whole digital sports category robotics space you got a satellite announcement this is a genre changed in digital culture and you see the AI stuff and machine learning how does the web services stack play in this new world where AI is now a service it's a whole nother paradigm shift what's your thoughts on all that well you know I mean all those areas that were continuing to expand into our areas that our customers are asking us to help them with and where there are huge opportunities for customers but where it's hard I mean if you look at space as an example if you've to interact with a satellite it's it's expensive to have to have all those satellites set up you know and those drown ground antennas set up and then you have to program them and then and you actually have to pay this fixed price instead of on-demand customers so why can't you give us access those satellites the way we consume AWS and then if you can have the ground antennas where when the data comes down from the satellite it's basically on the same premises as your AWS region so we can store the data and process the data analyze it and take action that is very compelling so that that just felt like a natural fit you know and the same thing with robotics I think that robotics is one of the most underrated areas of Technology I think robots will do all kinds of things for us at work and in a home and the tools out there to make it easy to build robotic applications and to do the simulation to deploy them and then have them work with the rest of your applications and infrastructure have been pretty primitive and so robot maker is I agree with you I think you look at the younger generation too even at the high school elementary level people are gravitating towards robotics robotics clubs are booming that maker culture goes through a whole nother level with robotic congratulation you know it's funny we had the youngest person to ever pass the AWS certification exam is a kid named Karthik nine years old passed and he was here this week actually and I got a chance to meet with him today and I said well after the certification what are you doing he said well I'm building a robot you know I'm feeling Ruben he said now with your launch of deep racer I want to try and find a way to to have the deep racer car be the eyes and the camera and the reinforcement learning for my robot nine years old yes it's gonna be a different generation with what they build John and I were talking this morning Andy at our open about you're making it harder for the critics used to be self-service only it criticized your open source contributions the hybrid strategy your turn a tick in the box is on all those outpost was I think surprised a lot of people it didn't so much surprise us that you were moving in that direction but I wonder if you could sort of talk about some of those key initiatives I know it's customer driven but wow the the TAM expansion the the customer value that you're bringing it's like a whole new era that you're entering yeah you know everything we build is you guys know we talk about all the time it's just it's driven by what customers want and so we just started over the last six months you know and really by virtue of having this partnership with VMware where we have a lot of enterprise engagement as they're moving to the cloud using VMware cloud and AWS we had a bunch of customers say it's really great I'm moving most my application of the cloud but there's some that aren't moving for a while because they got to be close to selling on-premises and I want to use AWS for this I don't want a different environment can you just find a way to put some services like compute and storage on-premises and hardware but I want to actually use the same control plan I'm going to use for the rest of AWS and I wanted to easily connect with the rest of my applications in AWS and we had you know we didn't like as you and I talked about a week or two ago we just have not like the model that's been out there so far to do this because it's you know the control plane is different the api's are different the tools are different the hardware is different the functionality is different and customers don't like it's why it's not getting much traction and we didn't want to pursue it if we didn't think it was going to be useful but we had this concept we were working on with a couple customers where they wanted compute and storage on-premises but they wanted to have that connect with all the other applications in the AWS cloud and so we have this idea that maybe this local set of compute and storage would be like a far zone from an availability zone they were using and we started thinking about that and we thought there was much more generalized idea which became outposts and so the thing that I think people are gonna love about that is for the applications that can't move easily because they need to be close slang on-premises you get AWS like real AWS compute real AWS Storage Analytics database sage maker will be in there as well but it's the same api's same control playing the same tools the same hardware we use in our data centers and it will easily connect through the same control plane to the rest of AWS the rest of the services and the rest of their applications there so and it provides a platform for a whole host of new services down I mean every customer meeting I've had in the last we made the announcement people are excited about I want to ask you guys are talking about all the innovation and new areas and we're seeing an expansion of the AWS distinct brand and things like TV advertising statcast I wonder what's behind that can you address that yeah it's a good question I mean there's kind of two different types of I'll call it TV advert Swartz we're doing one is straight-up advertising one is less so which is you know the one that less so is that a number of the sports leagues are really interested in and actually pretty sophisticated in using cloud computing and analytics and machine learning if you look at Major League Baseball now NFL and Formula One and they want to make the user experience and the viewer experience so much better and so they're building on top of AWS and then we like the ability of helping them showcase the capabilities that they're you know both the customer experience and the ml and AI capabilities then there's just a straight-up advertising them that we've been trying we tried a little bit of it last q4 and you know it's always very difficult to quantitatively measure tvf but we have a lot of ways that we try to triangulate that and we were really surprised and what looked like the positive numbers we saw for both TV as well as the outdoor media and things like in the airports and things like that and so we decided we would try it again this q4 and you know I think I would call us right now still experimenting yeah and it's very much kind of what Amazon does which is we try different things to see what resonates the see Whitefield says so so far so good and we expect to keep experimenting I I think that's a good call because the brand lift is probably there I'll see impressions get reach vehicle but you guys are in a rising tide market we're hearing co-creation VMware co-creating deep meaningful partnerships you always talk about that so it's kind of this success model of innovation to reimagine the satellite Lockheed Martin a partnership this seems to be a new way to do business in this rising tide how are you guys getting the word out education people want to know more this is a big kind of movement yeah well you know I think that if you looked at the first several years of AWS I was always surprised when I would go see enterprises and they would have no idea that Amazon was doing anything in the cloud even though we had the only cloud offering at the time so I think if you compare where we were a few years ago to today there's you know gigantic awareness relatively speaking but I still think that there are so many majority of workloads still live on premises I mean we have a twenty seven billion dollar revenue run rate business it's growing forty six percent year-over-year and yet we're still at the early stages of the meet of enterprise of public sector adoption in the u.s. you go outside the US where there twelve to thirty six months behind depending on the country in the industry and sometimes it feels like you know like Groundhog's Day well you guys are doing regions out there Italy as was announced yeah you're expanding very fast globally can you talk about that real quick yeah it's it's a you know we've had customers from 192 countries using AWS for many many years but they've been using AWS in regions outside of their country usually because there are a lot of workloads that could stand that latency and where the data doesn't have to be on natural soil but increasingly if you want to help customers get done what they want to and serve the broader array of their applications you have to have regions in their country both so that they have lower latency to their end users and because the data sovereignty laws which are getting really more rigid rather than more flexible let me ask you a question about competition you you said I can't members on the cube or in person there's no compression reach out gorilla for experience and time elastic economies with scale when you have copycat people trying to copy Amazon how do you talk about some of those things that are those diseconomies of scale what are the points that customers should look at when they say okay I got someone else is talking cloud Amazon's got years of experience ahead of the competition more services what do you talk about what do you point to you it's not about slimming the competition but what is the diseconomy of scale to try to match the trajectory of Amazon yeah it's it's a bunch of things you know first of all it's operational performance you know a lot of the hardest lessons you learn and operating of scale only happen when you get to that level of scale and you know there's some events that we see sometimes elsewhere we look at that and then we read the post-mortem we say oh yeah 2011 you know we remember they went through that I don't wish it on anybody but when you have a business at several times larger than the next or providers combined you just said a different level of scale and you've learned lessons earlier I also think that the reason that we continue to have both so much more functionality and innovate at a faster clip and seem to get capabilities that customers want is because we have so many more customers than anybody else you know a lot of times and this is happening all week to where customers will say to me I can't believe that you knew that I wanted that and I always say it's because you told us yeah it's not like we're Nostradamus you've told us that and so when you have so many more customers and when they feel free to give you feedback and when you've built good mechanisms like we have to get that feedback from the field to the product builders it means there's this real flywheel of getting you know getting more customers leads to more feedback leads to more features leads to better functionality where there's a network effect from being on the platform with all those other customers and all those industries I wonder if you could add some color to a premise that we've put forth on your edge strategy so what you guys you know we do a lot of these shows and a lot of the IOT and edge strategies that we've seen from traditional IT players what you call the old guard have fallen flat in our opinion because it's a top-down approach it reminds us of the Windows Phone it just didn't work and it's not going to work as their operations technologies people we see what you've announced here as a Bottoms Up approach you developing an application platform to build secure and manage apps for those folks right at the edge I wonder if you could add some color to that and some thoughts on your edge strategy yeah I mean again for us if we don't have some top-down strategy that you know that I think is grandiose it's just what customers want and so we have so many customers who have all these devices at the edge and all these assets at the edge and they said to us well the first problem I have I want to get this data into the cloud and then I want to do analytics item we say ok well how can we help they say well the first thing is I don't even know how to translate this data from the device protocol to just being able to operate in the cloud so that's the first problem we go solve well then people say ok now I can get it in but I actually I need security like you know if you look at the amount of security options for these edge devices it's a new field you know let that dine attack that took a lot of the internet down a couple years ago came from you know a device on the edge and so that's why you know we built you know a security capability and people say well okay now you've made it so I can run devices but if I'm gonna run thousands of devices I need a way to manage all those devices of scale and we build telling to manage two devices and people say well ok it's great that I can do it and device is big enough that have a CPU but what about when they don't have a CPU you know they have just a microcontroller and that's why we built the our toss piece and you know the list kind of keeps going people so this is great now that I get all this data in the cloud I can take all these analytics actions but on my device sometimes I don't want to make the round trip to the cloud so can you give me a way to use the same programming model and and pick which triggers I want to take action with cloud versus those that want to take on the device itself which was what green grass was so all of those pieces is not some kind of top-down master plan as much as we know that customers have all these devices the edge that they want to use that data analyze that data take action on that data and send it back in multiple ways and you have you have the cloud platform to give them the services to make the tools the right tools for the right job yeah that's the main team yeah so I got to ask you about one of the big controversies that we don't think that's that controversial but the chips that you announced new Amazon Web Services front microprocessors the chips yeah do two of them talk about them and Intel's also a partner a lot of people are talking about this in the press yeah Intel Amazon chips well that annapurna acquisition is Norton they bear fruit was 2015 I think yeah early it really the annapurna team is fantastic and they've added a huge amount of value to AWS and Amazon as a whole you know the first thing I would say is that Intel is a very deep partner of AWS and will be for a long time I mean that that's not changing and we've been a long thought that they were gonna be lots of different processors out there and and different ones that did different things at different price points and so like a lot of other companies we've been interested in arm for a long time and for a while it wasn't mature enough and the technology is matured and we found a way in in building our own ARM chip with graviton where we think we can allow customers to run a lot of their scale out generalize were close but up to 45 percent less expensively and so when you find a value proposition that compelling for customers you need to do it and you know as I mentioned in the keynote yesterday when we were talking about inference we feel like a lot of the world has been solvent for training and not solvent as much for inference yet and we've made training so much easier with the things that we've built in AWS over the last couple years but inferences where most of the cost is gonna be and so elastic inference we think it you know will allow people to be much more efficient in how they use them for use and how they spend money but when you've got the type of workloads at scale and productions that use whole GPUs or that need that low latency where you need it on the hardware of a chip that's optimized for inference they is faster that's more cost effective that's high throughput we can get hundreds of tops on it and thousands to you ban them together he's gonna totally change the game for imprison and so that was something that wasn't easy for us to find elsewhere and when we have team fortunately they could build it and it's the combination of the elastic service of inference with the chip that makes the difference it specialism there so it's not like I mean you can use each on their own and we expect they'll be a bunch of customers who will use each on their own but there will be an opportunity to use those in combination that will be very powerful it comes down to really deeply understanding the customer problem again at night training versus inference and everybody talks about the training right the the technical challenge you got a child is the internet and tells gonna make a lot of money as it stands expanding market banding so they'll get their share the chips get taped out their con a couple year to three year life cycles and everything starts anew every time somebody's building a new chip so I think it's actually great for customers of all sorts that there's multiple processors that are possible but we will have a deep relationship with Intel forever I think so I want to talk about one of the cool demos you did on stage not a lot you did customer did f1 that was a super cool I love that imagery because it said an analogy of high performance competitive racing that can be applied to this play sports anything and the level of accuracy that they need in the real time time series kind of encapsulates a lot of the cloud value talk about the f1 analytic thing are you guys gonna sponsor these events there's a relationship there give us what the picture of what's going on there you have a deep relationship with Formula One where they're using our platform to to do their all their digital properties as well as their analytics and machine learning and it was super cool to see Ross demo the way that they're changing the user experience for for viewers and you know it's it's it's an amazing sport you know it's not watched as much maybe in the US but outside the US that is the motorsport and the way that they're changing the experience the way that they're able to assess what's happening with drivers and with cars and then predict what's actually happening and make the viewer feel like they're actually either in the cockpit or actually in the pit itself with it with the crew is it's really exciting and it's non err to be a partner so you do some events they'll get the cube they're these these big time again there's a tech angle now and everything it's a plug for you to be at the they have one event cloud demócrata you're hitting now new industries I mean this is the thing right I mean it's disrupting every industry I mean what aren't you disrupting I mean what areas do you see that yet aren't coming online to the cloud I don't see industry segments at this point that aren't moving to the cloud I would have told you 18 to 24 months ago that I felt like financial services was moving a lot more slowly than then I thought they should or you know probably healthcare also was a little bit slower but both of those industry segments are moving very aggressively well it's taking longer they're high-risk industries and the digital transformation has it occurred fast enough but it's coming and there's regulatory pieces that they legitimately have to sort through and you know we have just if you look at financial services as an example we have a pretty significant team that does nothing but work with our partners to help them with the regulatory bodies because what we find is when we go with a customer to a regulator and show them a real use case and then how it will be done in a DOP is the regulator says oh well that's more secure that you do on-premises and so it's just an education process and you know I think that's been helpful in it and I'll get final questions for you what have you observed here at reinvent Houston glad people talking so you get a lot of feedback actually to clopped two-part question because I was asked the final final question so I'll just get it out front what are people missing of all the announcements you've had a lot of signal in there a lot of a lot of announcements what are what is something that you've observed that you think should be amplified that people might have not overlooked but like you feel like it's more important to sign the light on we'll start with that one well you know it's a little hard for me to tell this moment just because there have been so many in such a short amount of time and and if we just look a little bit at the coverage it seems and if I take just as inputs they comments and and the questions from customers it's been pretty broadly understood and people are pretty excited and as I said different segments have kind of their favorite areas but I feel like people are pretty excited by the breadth of capabilities you know I think that if I pick two in particular I would say that people are still in the machine learning space people are blown away by how much we provided are all three layers of the stack I think people are still getting their heads around which layer of the stack am I gonna participate at you know I mean the one that probably has the most potential for most companies is that middle layer because most companies have gobs of data and there are jewels in that data and if you can enable their developers their everyday developers to be able to build models and get at the predictive value and add value that has huge impact for companies moving forward but most modern companies with technology functions will use all three layers of the stack and so just getting their arms around which layers of the stack they should take advantage of first and having the personnel to be able to do it and we're making that much easier with things like sage maker and then you know I think if you look at the blockchain space I think that that is just one of those spaces that has a huge amount of buzz people talk a lot about it exactly sure sometimes what they're gonna do but but I also think that a lot of people said to us that breaking those into those two real customer jobs to be done and then having a great solution that does each of those jobs really well is not only something that AWS does all the time that makes it easier for them but it also made it easier for a lot of them to understand that a lot of customers said to us you know that qld be that ledger database with a single trust of central authority for my supply chain that's what I need for my supply chain I don't need all the complexity of a blockchain framework and then there were a lot of other people said oh yeah that is what I want I wanted to decentralize trust between peers but I just needed a way easier way to manage hyper ledger fabric and etherium so I think those are two that people like are so interested and still figuring out how to use as expansively as I think they hope they will Andy thanks so much for your time and I want to just say watching you guys in the past six years has been a fun journey together but watching the execution you guys have done an amazing job of keeping your eye on the ball and being humble but being proud and loud at the same time so congratulations and you know guns blaring in 2019 what's your top pray all right besides listening to the customers what's your top 20 19 we know you listen to cut oh my gosh we have so many things that we're doing in 2019 but you know we have a lot of delivery in front and in front of us I mean as much as we launched 140 unique things over the last six to eight business days and yet I tell you to stay tuned the rest of 2018 we have more coming and then in nineteen you'll you should expect to see more few capabilities more database capabilities more machine learning capabilities more analytics capability look a lot I could spend all night John we don't need it we don't need a post reinvent post you know traumatic announcements syndrome because just to digest it all yeah it's a lot of work looking forward to seeing how enterprises continue to make to to kind of manage their hybrid approach as they're as they're making this trend transition from on-premises to the cloud how many continue to jump on to VMware cloud an AWS how many jump onto outpost so I think that that transition and helping customers do that easily is something on here of course we'll be commentating and pontificating on that for the next year thanks for your time I really should have me and I appreciate that you guys come at regular pay our pleasure okay winding down that's the last interview here wall to wall covers two cents 110 interviews in the books we'll have 500 video assets total blog post on Sylvia angle calm that's reinvent closing down 2018 thanks for watching [Music]

(uptempo orchestral music) >> Welcome to theCubeConversations here in Palo Alto, California. theCube Studios, I'm John Furrier. The co-host of theCube, and co-founder of SiliconANGLE Media. Junaid Islam is the present CTO of Vidder that supports the public sector as well as the defense community as well as other criminalist oriented security paradigms. Expert in the field. Also part of coming Vidder that's doing a lot of work in the area. Thanks for sharing your time here with us. >> Well thanks for having me. >> We had a segment earlier on cybersecurity and the government. So that was phenomenal and also, we talked on the impact of hacking on business. So the number one issue on the boardroom agenda is security. Data, security, it's a big data problem. It's an AI opportunity, some things that are coming out. Embryonic, it's an early shift. Security is a challenge. The old model, the firewall, a moot, doors, access, you get in then you're done. It's over, it's a criminalist world. People can get access to these networks. Security is screwed right now. And we generally feels that. So the question for you is the Enterprise and in business as we're looking to show up security. Isn't it a do-over? >> Yeah, yeah, I think like other industries. Whether you talk about the PBS. Yes, yes, where you talk about computers shifting to the data center and then the cloud. I think last year or this year, Gartner said 100 billion will be spent on security. I cannot believe anybody who was involved in that 100 billion dollar expenditure is happy. In fact we have something interesting. Security expenditure has risen consistently over the past five or six years, and cyber attacks have also risen consistently. So that's not the kind of correlation you want. >> And they're buying anything that moves basically, they're desperate so it seems like they're like drunken sailors. Just like give me something. They're thirsty for solutions. So they're groping for something. >> Yeah and what we're seeing is a couple of things. One is the attackers have gotten much more sophisticated. And they basically can bypass all of the existing security appliances. So what we need is a new approach or a new security stack that really fits both the architectural environment of American companies where they use Clouds and data centers, and they have employees and contractors. But also cyber attacks which have gone much more sophisticated. The classic cyber attack used to be connecting to the Server remotely or stealing a password. We still have the classics but we have some new ones where we have malware that can actually go from the user's device to inside the network. And you find that existing security products just don't work well in this environment. >> What are some of the do over ideas? >> Absolutely malware, we see it ransomware, super hot, the HBO example recently. They didn't given, who knows what they actually did. They weren't public about it but actually they maybe get a little bit in but these are organized businesses. They're targeting with the Sony hacks well documented but again businesses, I'm not always funded this. And then you got the move to the clouds. Couple dynamics. Cloud computing. Amazon has done extremely well, they're leading. Now getting a lot more of the Enterprise. They won the CIA deal a few years ago over IBM. And you see a lot of government Cloud rocking and rolling, and then you've got the on premise data center challenges. That's the situation of the customer then now you have potentially an understaffed security force. >> Well actually so, I think let's start with that point. In terms of our theme of a do over. Talk about that first and then let's talk the techno part. I think one do over that America needs is security has to move out of the IT department, and become a stand alone department reporting ideally to the executive staff and not being on it. I think one of the unfortunate things is because security is a cost center within IT, it competes with other IT expenditures such as new applications, which are revenue generating. It's very hard to be a cost center asking for money when there's a guy sitting next to you who's doing something to make money. But unfortunately, unless security is properly funded and staffed, it never happens. And this unfortunately is a chronic issue through all US companies. One of the things we've seen that has worked for example in the financial world is most financial institutions, probably all now security is a pure organization to IT, that helps a lot. This is actually not a new idea, this was something the intelligence community probably started-- >> Cost structures, it's just the cost structures. Reduce the cost is the optimization behavior. What you're saying is just like applications are tied to top line in revenue, which gives them top line mojo. You got to think of security as a money saving table stake. >> That's right. >> People are losing money. The cost are now becoming obvious, in some cases crippling. >> Yeah so I think people need to think of security as fundamental to the life of a company, number one. I think the other thing that needs to happen from a security perspective. Now that we've broken off this entity is it security needs to become a threat based or risk based. Too much of security in the United States is based on compliance models. Unfortunately cyber attackers do not follow that model when they want to attack us. They basically work outside the model and come up with creative ways to get inside of organizations. >> Basically blindside. >> That's right. >> The company. >> I can't tell you how many meetings probably all where I meet the security team and they're totally busy just going through the list of 20 or 50 things that they're are supposed to do. So when you talk about attack vectors. They say you know that's really great and I know it's important but we can't get to it. So this is another important shift organizationally. First you break it out. Second, get focus on something that's important. once we have that we get to the next part which is technologies. And right now what happens is people buy a security point product for different networks. One for data center or one for Cloud. And this doesn't work so I think we have to move to security solutions that can work across hybrid environments, and can also work across different roles. I think that is critical and unless we get that in technically. >> Yeah, this is the thing with Cloud and (indistinct talking). I want to bring this up. I had multiple change to sit down with Andy Jassy. The CEO of Amazon web services. Fantastic executive, built a great business there. On his mind, what's been important for him for many years has been security, and Amazon has done an amazing job with security. But that's in the Cloud. Now Andy Jassy and Amazon thinks everyone should be in the public Cloud. Now they have a deal with VMware but they're just powering VMware's on prem in their Cloud. It's not really a VMware issue but Amazon's world is raising the public Cloud. But they've done really, really good on security, but yet most of the buyers would say hey, the Cloud is unsecure I can't trust it. So you have the dynamic between the data center on premise resource. So people default to the behavior of and leaving here with the on premise. Or I'll put a little bit in the cloud, a little bit of workloads here. A little bit in the Microsoft. Google's got some, I'll keep the tire on Google. But they never really leaving the home base of the data center. But yet some are arguing and Dave Vellante, my co-host on theCube talks about this all the time. There's actually more scale in the Cloud. More data sharing going in the cloud and that the cloud actually got better security. So how do you see that resolving because this is a key architectural opportunity and challenge for Enterprise. >> Actually I think there's an optimal model which is if you think about what the data center gives you. It gives you a lot of visibility and physical control as in with your hands. The problem is when you put everything in the data center. You don't have enough people to manage it all properly. The Cloud on the other hand gives you a lot of scale but you can't actually touch the Cloud. So the optimal mix is imagine your encryption and access control solutions live in your data center. But what they control access to is to Cloud resources. So you can actually, if you're just open your mind conceptually. >> So it's like saying, it's like segmenting a network. You're segmenting feasibility. >> That's right, so now you don't need a gigantic data center because what's in your data center which can be a lot smaller now are things like your identity-based access management solutions. You can keep your cryptographic elements. You can have your HSM, things that generate random numbers and search there. But now this is actually can be very tiny. It can just be a rack of gear. But through that rack of gear, you can have very fine control of people accessing Cloud resources. And I think this idea of building, it's not so much a hybrid network, but it's a notion that a small physically locked down asset can control a lot of virtual assets. It's gaining mind share in the banking world. In fact, just this summer, there was bank that implemented such an architecture where the control elements were the Cloud were their FFIC data center. And it include, it basically managed access to Amazon VPC and it worked well. >> So interlocking is a strategy. I can see that, by the way I see that playing out pretty well. So I got to ask the next question which comes to mind is that sounds great on paper. Or actually in certain situations it might perfect. But what about the geo-political landscape? because Amazon has people that develop on the Cloud that aren't US citizens. So the government might say wait a minute, you got to only employ Americans so they got to carve out and do some whatever weird doings with the numbers to get that certification. But they need data centers in Germany because the German government wants certain things. So you have geo-political issues now on the companies. How does that affect security? Because now a Cloud like Amazon or a multinational company has two things going on. I have multiple offices and I'm operating in multiple geo-political landscapes with these regional centers. The regional clouds, or at Amazon they're called regions. >> So actually Amazon has actually done a great job. They basically have their global market, but they also have data centers now which are only opened to US persons in US companies like Globe Cloud. As well as well as they support the C2S which is the intelligence communities Black Cloud, which is basically off net so I think now-- >> John: So they're doing a good job? >> Yeah, they're doing a good job but the key thing is how you use that resource is really still up to the enterprise. And that's where enterprises have to get good at creating the architecture and policies to be able to harness Amazon's compute capacity. Amazon, is the foundation but you really have to finish off the solution and the other thing going back full circle to your first question. Unless the security team has their freedom and the mandate to do that, they'll actually never get there. >> So it's staffing and architecture. >> That's right. >> Well they both architecture. It's one's organizational architecture. Debt funding and one is more of a hardcore virtual and physical touching. >> And you know what I put in the middle? I'd say know your risks and develop counter measures to them. because if you go to that security team and you say you have to build a counter measure for every attack. That's not going to work either. A company has to be realistic is what is really important? Maybe it's the data of our customers. >> So the answer to the first question then obviously is yes a security do over is needed. But there is no silver bullet and you can't buy an application, it's an architectural framework holistically >> Junaid: That's right. >> That everyone has to do, okay cool. So the question I have on the Amazon, I want to get your thoughts 'cause it's a debate we have all the time on theCube is. And certainly Amazon has competitors that say, Amazon is really not winning in the enterprise. They've got thousand of Enterprise customers. They are winning in the Enterprise so Oracle is catching up, barely in fourth place. But trying to get there and they're actually making that transformation. Looking pretty good, what more now assume that Oracle will (indistinct talking). But Amazon has one great gov Cloud deals. So they're convinced the government that they could do it. >> Junaid: Yeah. >> So to me that's, my argument is if the government is winning with Amazon. It should be a no brainer for the Enterprises so this comes back down to the number one question that's been holding back Cloud growth. Whoa, security, I don't want to put it in the Cloud. How real is that objection now? 'Cause the knee jerk reaction is you know what, I got an on prem, I don't trust the Cloud. But it seems like the Cloud is getting more trust. What's your thoughts on that objection? >> So one of the things as even though when we use the word Cloud, generically or Amazon generically. Amazon has evolved a lot in the last three to four years that I've been working on it. The number of embedded tools in Amazon is vast now. If we were having this conversation two years ago. The notion that granular encryption modules would be there and Amazon is apart of an offering. It would have been science fiction or the fact that-- >> More that S3 and AC2, what else could there be? >> That's right or they have things like virtual HSM. They have embedded identity and access control tools all there so I think first of all. All of the building blocks that you would want are there. Now unfortunately there's no short cuts. Amazon is not going to do the work for you, you still need a staff that knows how to use digital certificates. You still need your own identity based access control system to manage access of your employees and contractors and people in India to these assets in the Cloud. But having said that, we now actually have a model that is much cheaper than the classic data center model. That's basically usable. >> I'm smirking some people think I'm an Amazon web services fan boy but besides the fact that I love the company. They've done well and there's so many new services, and they literally have been skating rings around the competition. If you look at the complexity that they have been dealing with and the innovations. So the outputs put that out there. I'm a little biased 'cause I think they're doing a great job. But now, the game start to shift as Amazon continues to add more services. Welcome to the big leagues called the Enterprise and government, which they're doing some business in now. So the question is besides Amazon, those other guys. Verizon, the Telecos have really trying to figure out what to do with over the top for years. Now they're also powering a lot of multi tenet workloads as well, including their own stuff. So telecos and service providers out there, what are they doing because they're still critical infrastructure around the world. >> Actually, I think if we just use Amazon as a reference point or example. Amazon initially didn't worry about security but then over the last few years, worked hard to integrate security into their offering. We're now in the early stages of seeing that from for example carriers like Verizon. Where in the past Verizon was saying first secure yourself then in the last two years. Version okay, here's some products and services you can buy. But now where we're heading is they're trying to make the network inherently secure. A lot of the basic components like device matching to identity matching basically making that apart of the underlying fabric. So I think the good news is as-- >> So they're making advances there. They have networks. They know networking. >> So the good news is as bleak as it all seems as we are making significant progress as an industry and as a country. Having said that, my only and warning is you still need an executive team. A security team that knows how to leverage all of these components and pull them together. And that goes back to having a risk based approach and protecting the most important things. I think you can do that, I think the tool set that's come out now is actually pretty sophisticated. >> So final question, I want to get your thoughts and we can end the segment and then we'll take a little bit about Vidder, your company. But I asked Pat Gelsinger, CEO of VMware at VM World just recently about the security duo 'cause Dave Vellante asked him years ago. He said absolutely it's going to be (indistinct talking) so Pat Gelsinger has it right again. The guy is like Nostradamus when it comes to tech trend. He's a wave guy from Intel, so he gets the waves. But I asked him about that question again this year and I'll send the tip out on Twitter. I'll put it out on Twitter, I'll make a link to it. He said that 5G is going to be the big kahuna of the next 30 years. He thinks that as 5G starts to get out, it's going to develop 10X number of antennas, 100X of bandwidth, new spectrum allocations, 100X new devices, they're all going to be connected as well. As you mentioned we're a connected world. This brings up the edges of the network where he says, "Next thirty years is going to be massive build out." So okay, 5G is coming. Industrial IoT, IoT internet of things is happening. How is this going to change a security game because now you have networking and you see VMware. We're doing NSX and Cisco has been trying to the Enterprise figuring out the virtualization of network level. Everything comes back down to the network. Is that where the action is because it seems to me that the network guys have to figure this out. And that seems to be the point of reference in terms of opportunity. Or is it a challenge or is it moving up the stack. How does all the networking changes happen? >> So for IoT, we really need two things to happen. I think one is we actually don't have a security standard for IoT devices. And specifically the issue is malware. IoT devices and softwares made worldwide and I think one of the biggest policy weaknesses we have right now is there's no minimum standard. This needs to be solved, otherwise we're in a lot of problem but in parallel to that. There is a lot of technical development. One of the things that's happening in the networking world is for the past 20 years. We were driven by what's called a network VPN of Layer 3 VPN, it's your classic VPN, that connects a device to a server. The problem with that is if you have malware on the device it gets through. So there's this new kind of VPN which is an application VPN or we call it a Layer 4, which is basically a softer process in the device tool. A softer process in a server. So that's the new model, which is-- >> They're making them as dumb as possible and go up the stat. >> Not so much-- >> There were guys that are going to roll-- >> I could have used different terms. I could have say make the app network application aware so that it only lets the applications get through. Not any kind of connection, so I think that is something. >> Well the networks have to smarter and enable the smartness. >> So smarter networks are happening and it's an area that I worked in. It's very excited. >> John: I don't mean to offend you by saying dumb network-- >> But the application but to be clear though that's just one piece of the puzzle. The other piece of the puzzle which unfortunately is a little bit lacking is there's no standards for IoT software today. And unless we have concepts like secure boot, that is the software can't be tampered with. I think I've unfortunately there's a bit of risk but I'm hopeful-- >> And then IoT for folks watching, there might be any inside baseball. It's a surface area problem. There's more points of attack vectors, so we talk about the compliance thing. >> Not only are there more attacks, by and large IoT devices are made outside of the United States. Physically they are made in China and a lot of the software comes from India. And there's nothing wrong with that, but the global supply chain provides plenty of opportunities for cyber attackers to inject in their code. And this is something we need to watch very carefully and then like I said-- >> So this is actually one of those weird derivative results of outsourcing that American companies have realized that's a problem. >> Yeah so. >> Is that right? >> Yeah so it's something we need to watch carefully. >> Okay, thanks for coming on the theCube. Really appreciate you sharing your perspectives. Talk about Vidder, you're the president and CTO. You guys in the security business. Obviously you're an expert with (indistinct talking). We'll have you back and multiple times. I'd love to get your company as we follow all the security trends. We have a cyber connect conference with Centrified coming up in New York. We're covering gov Cloud AWS and other players out there. What's Vidder doing? What's the company do for products? How do you guys sell? Who's your customers and what are the cool things you're doing? >> We've developed a access control solution based on a new standard called software defined parameter. And there's two things that are unique about it. First with technology like software defined parameter. We work in the Cloud in the data center, but more importantly, we're able to stop existing attacks and emerging attacks. So things like password theft, credential theft of server exploitation we stop because we don't want to allow connections from unknown devices or people. The other thing is say you're known, and you connect with server. We basically look inside your laptop and only allow the authorized process to connect to the server. So if there's malware on the device, it can't actually make it through. >> John: So it shuts down the malware. >> That's right. >> John: So you're trying sneak through. >> That's right, the malware. We can't stop the malware from getting on the device, but we can make sure it doesn't get to the other side. >> So it doesn't cross pollinate. It doesn't go viral. >> That right so a lot of the stuff we do is very important. We work with a range of-- >> You have government, obviously contracts. I'm sure you have that can't talk about but you do right? >> Yeah we do a little bit of work with the government and we're just start working with Verizon, which is public. Where they wish to create services where malware actually can't go through the connections. So we're doing exciting stuff and we're-- >> Enterprise customers at all? >> Yeah, yeah we have banks. >> Who are on high alert. >> That's right. >> You guys do tier one or it's the houses are burning down, you're there. So we do banks and we're just started doing some work in a hospital were again it's (indistinct talking) compliant, and they need to make sure that data doesn't leave the hospital. >> So what's the number one thing that you guys have as ransomware something that you solve. What areas do you guys being called in? What's the big fire bell, if you will? They ring the bell when do you come in? What the thing, just in general? >> Our number one reason for existing is stopping attacks on application servers or service that old data. That's our focus. So if you have data or an application that someone is after. We will make sure nobody gets to that data. In fact, we'll even make sure if there's a spy, or insider attack, who comes into your organization. They'll only be able to what their allowed to do and won't be able to do anything else. >> So on the weekly Fox that was big. Would you guys have helped there is they were a customer or is that just different thing? >> I know we could have helped because one of the things that happened is they used their server exploit to basically propagate through their data center. So we probably wouldn't have done much on the initial exploit, but we would have kept it from going deeper into the system. >> And they hid for four months and they were poking around so you would have detected. >> Yeah and we certainly would have stopped all the poking around. Because we basically, you can think of us as an identity based access control mechanism. So based on your identity, you can only do very specific things. And in their case, they had the identity of the user. We wouldn't have let them do anything except maybe just go to one website. >> Yeah you would have shut them down. They should have been doing business with Vidder. Jay thank you for coming on theCube here for theCubeConversation in Palo Alto, California. I'm Jon Furrier with theCubeConversation. Thanks for watching. (slow orchestral music)

(the Cube jingle) >> Hello, welcome to the CUBEConversation here in Palo Alto, California in theCUBE Studios. I'm John Furrier, the co-host of the CUBE and co-founder of SiliconANGLE Media. Junaid Islam is president and CTO of Vidder, supports the public sector as well as the defense community as well as other perimeterless oriented security paradigms, expert in the field, also part of up and coming Vidder that's doing a lot of work in the area. Thanks for sharing your time here with us. >> Well thanks for having me. >> We had a segment earlier on cyber security in the government so that was phenomenal but also we talked about the impact of hacking on business. So the number one issue on the board room agenda is security. >> Yeah. >> Data, security, it's all, it's a big data problem, it's a AI opportunity. Some things that are coming out is embryonic early shifts. Security is a challenge. The old model of the firewall, a mode, doors, access, you get in, then you're done. It's over, it's a perimeterless world. People can get access to these networks. Security is screwed right now. Everyone kind of generally feels that. So the question for you is in the enterprise and in businesses who are looking to sure up security, is it a do-over? >> Yeah, yeah, I think, like other industries, whether you talk about-- >> Yeah, so that's a yes? >> The PBS-- Yes, yes. >> Yes, it's a do-over. >> This is where you're talking about computers shifting to the data center and then the cloud, I think last year, or I think this year, Gardner said 100 billion will be spent on security. I cannot believe anybody who is involved in that 100 billion dollar expenditure is happy. In fact, we have something interesting. Security expenditure has risen consistently over the past five or six years. And cyber attacks have also risen consistently. That's not the kind of correlation you want. >> Yeah, they'll buy anything that moves basically. They're desperate-- >> That's correct. >> So it seems like they're like drunken sailors. Just like, "Give me something." They're like thirsty for solution so they're groping for something. >> Yeah, what we're seeing is a couple of things. One is the attackers have gotten much more sophisticated and they basically can by-pass all of the existing security appliances. So what we need is a new approach or a new security stack that really fits both the architectural environment of American companies where they use clouds and data centers, and they have employees and contractors, but also cyber attacks which have gotten much more sophisticated. And the classic cyber attack used to be connecting to the server remotely or stealing a password. We still have the classics but we have some new ones where we have malware that can actually go from the users device to inside the network. And you find that existing security products just don't work well in this environment. And so it'-- >> So what is in the do-over ideas. Obviously malware, we see it. Ransomware is super hot, the HBO example recently. They didn't give in, who knows what they actually did. They weren't public about it but I'm sure they did maybe give a little bit in. But these are organized businesses. >> Yeah. >> Right? They're targeting... The Sony hack's well documented, but again, businesses have not always funded this. And then you got the move to the clouds. Couple dynamics. Cloud computing. Amazon's done extremely well, they're leading now getting a lot more in the enterprise. They won the CIA deal a few years ago over IBM. >> Yeah. >> And you've seen a lot, GovCloud rockin' and rollin'. And then you got the on-premise data center challenges. So that's the situation of the customer. But then now you have potentially an understaffed security force. >> Well, actually it's so. I think let's start with that point in terms of our theme of a do-over. Talk about that first-- >> Yeah, all right. >> Then let's talk the techno part. I think one do-over that America needs is security has to move out of the IT department and become a standalone department reporting ideally to the executive staff, if not being on it. I think one of the unfortunate things is because security is a cost center within IT it competes with other IT expenditures such as new applications which are revenue generating. It's very hard to be a cost center asking for money when there's a guy sitting next to you who's doing something to make money. But unfortunately, unless security is properly funded and staffed, it never happens. And this unfortunately is a chronic issue through all U.S. companies. One of the things we've seen that has worked, for example, in the financial world, is most financial institution, probably all, now security is a pure organization to IT and that helps a lot. This is actually not a new idea. This was something the intelligence community probably started 15 years ago. >> And the cost structure-- >> Yeah. >> Is just a cost structure. >> Reduce the cost as-- >> Yeah. >> As the optimization behavior. What you're saying is just like Apple cases are tied to top line revenue, which gives them power-- >> Yeah. >> And mojo, you got-- >> Security. >> You got to think of security as a money saving table stake. >> That's right. >> People are losing money. The costs are now becoming obvious. >> Yeah. >> And in some cases crippling. >> Yes, so I think people need to think of security as fundamental to the life of a company, number one. I think the other thing that needs to happen from a security perspective, now that we've broken off this entity, is that security needs to become threat based or risk based. Too much of a merit security in the United States is based on compliance models. Unfortunately cyber attackers do not follow that model when they want to attack us. They basically work outside the model and come up with creative ways to get inside-- >> Yeah. >> Of organization. >> And basically blindside-- >> That's right. >> bleeding the companies. >> Yeah, so I can't tell you how many meetings, probably all, where I meet the security team and they're totally busy just going through this list of 20 or 50 things they're supposed to do. So when you talk about attack vectors, they say, "You know that's really great and I know "it's important but we can't "get to it." So this is another important shift organizationally. First break it out, second get focus on something that's important. >> Yeah. >> Once we have that, we get to the next part, which is technologies, and right now what happens is people buy a security point product for different networks; one for data center, one for cloud, and this doesn't work. So I think we have to move to security solutions that can work across hybrid environments and can also work across different roles. I think that is kind of critical. Unless we get that in technically, I-- (laughs) >> Yeah, and this is the dynamic with cloud and the data center. I want to bring this up. I had a multiple chance to sit down with Andy Jassy who's the CEO of Amazon Web services. Fantastic executive, built a great business there. What's on his mind and what's been important for him for many years has been security. And Amazon has done an amazing job with security. But that's in the cloud. Now, Andy Jassy and Amazon thinks everyone should be in the public cloud. >> Yeah. >> Now they have a deal with VMware but they're just powering VMware's OnPrem in their cloud. It's not really their... VMware issue, but Amazon's world is everything's in the public cloud. But they've done really, really good on security. But yet most of the buyers would say, "Hey, the cloud "is unsecure, I can't trust it." So you have the dynamic between the data center on premise resource. So people kind of default to the behavior of I'm leaving everything on premise or I'm only putting a little on the cloud, a little bit of work loads here, a little bit in the Microsoft. Google's got some, I'll keep the tires on Google. But they're never really leaving the home base of the data center. >> Yeah. >> But yet some are arguing, and Dave Vellante my co-host on theCUBE talks about this all the time, there's actually more scale in the cloud, more data sharing going on in the cloud-- >> Yeah. >> And that the cloud actually has got better security. >> Yeah. >> So how do you see that resolving because this is a key architectural opportunity and challenge for enterprises. >> So I actually, I think there's an optimal model which is if you think about what the data center gives you, it gives you a lot of visibility and physical control, as in with your hands. The problem is when you put everything in the data center you don't have enough people to manage it all properly. The cloud on other hand gives you a lot of skill but you can't actually touch the cloud. So the optimal mix is, imagine your encryption and access control solutions live in your data center but what they control access to is to cloud resources. So you can actually... If you just open your mind conceptually, as-- >> So instead of saying... It's like segmenting a network, you're segmenting capability. >> That's right. So now you don't need a gigantic data center because what's in your data center which can be a lot smaller now, are things like your identity based access management solution, you can keep your cryptographic elements, you can have your HSM, things that generate random numbers and certs there. But now this is, actually can be very tiny. It could just be a rack of year. >> Yeah. >> But through that rack of year, you can have very fine control of people accessing cloud resources. And I think this idea of building, it's not so much a hybrid network, but it's a notion that a small physically locked down asset can control a lot of virtual assets is gaining a mind share in the banking world. In fact, just this summer there was a bank that implemented such an architecture where the control elements for the cloud when their FFIAC data center and it include... It basically managed access to Amazon DPCs and it worked well. >> So interlocking is a strategy, I can see that playing-- >> Yeah. >> And by the way I can see that playing very well. So I got to ask the next question which kind of comes to mind as, that sounds great-- >> Yeah. >> On paper, or actually in certain situations, it might be perfect. But what about the geopolitical landscape because Amazon has people that develop on the cloud that aren't U.S. citizens. >> Yeah. >> So the government might say, "Wait a minute. "You got to only employ Americans." So they got to carve out and do some whatever weird things with the numbers to get the certification. But they need data centers in Germany because the German government wants certain things. So you have geopolitical issues now on the companies. How does that affect security because now a cloud like Amazon or a multi-national company has two things going on. I had multiple offices and I've been operating in multiple geopolitical landscapes with these regional centers, the regional cloud, or on Amazon they're called regions. >> Yeah. >> Or zones. >> So actually Amazon actually has done a great job. They basically have their global market but they also have data centers now which are only open to U.S. persons and U.S. companies like GovCloud as well as the support C2S which is the intelligence community's black cloud, which is basically off net. So I think now-- >> So they're doing a good job, you think? >> Yeah, they're doing a good job. But the key thing is how you use that resource is really still up to the enterprise. And that's where enterprises have to get good at creating the architecture and policies to be able to harness Amazon's kind of compute capacity. Amazon can, it's kind of the foundation but you really have to finish off the solution. And the other thing, going back full circle to your first question, unless the security team has the freedom and the mandate to do that, they'll actually never get there. >> So it's staffing and architecture-- >> That's right. >> Well they're both architectural. It's just one's organizational architecture and funding and one is more of a hard core virtual and physical touching and understanding. >> Yeah, and you know what I'd put in the middle? I'd say know your risks and then develop counter measures to them. Because if you go to that security team and you say you have to build a counter measure for every attack, that's not going to work either. A company has to be realistic is what is really important (laughs) and maybe it's the data of our customers. (laughs) >> So the answer to the first question then, obviously is yes. >> Yeah. >> A security do-over is needed but there's no silver bullet. You can't buy an application. It's an architectural framework, wholistically. >> That's right. >> That everyone has to do. Okay, cool. So the question I have on the Amazon, I want to get your thoughts on this because the debate we have all the time on theCUBE is, and certainly Amazon has competitors that say, "Oh, Amazon's really not winning in the enterprise." They got thousands of enterprise customers. They are winning in the enterprise so Oracle's catching up, barely in fourth place, but trying to get there. And they're actually making that transformation, looking pretty good, we'll have more analysis on that Oracle open role. But Amazon has won great GovCloud deals. >> Yes. >> So they've kind of convinced the government that they could do it. >> Yeah. >> To me that's... My argument is if the government's winning with Amazon, it should be a no brainer (laughs) for the enterprises. So this comes back down to the number one question that's been, quote, holding back cloud growth. Whoa, security, I don't want to put it in the cloud. How real is that objection now? 'Cause knee jerk reaction is, "You know what, "I got it OnPrem, I don't trust the cloud." But it seems like the cloud is getting more trust. What's your thoughts on that on changing? >> Yeah, actually, so one of the things is even though we use the word cloud kind of generically or Amazon generically, Amazon has evolved a lot in the last three to four years that I've been working on it. The number of embedded tools on Amazon is vast now. If we were having this conversation two years ago the notion that granular encryption modules would be there in Amazon as a part of an offering, it would've been science fiction. Or the fact that-- >> More than S3 and EC2. What else could they do? (laughs) >> That's right, or they have things like virtual HSM, they have embedded identity access control tools all there. So I think, first of all, all of the building blocks that you would want are there. Now unfortunately there's no short cuts. Amazon's not going to do the work for you. You still need a staff that knows how to use digital certificates. You still need your own identity based access control system to manage access of your employees and contractors and people in India to these assets in the cloud. But having said that, we now actually have a model that is much cheaper than the classic data center model that's basically usable. >> I'm smirking because some people think I'm an Amazon Web services fan boy but besides the fact that I love the company, they've done well and there's so many new services. >> Yeah. >> And they've literally been skating rings around the competition. >> Yeah. >> If you look at the complexity that they've been dealing with and the innovation, so I'll put that out there, a little bit biased because I think they're doing a great job, but now the game starts to shift. As Amazon continues to add more services welcome to the big leagues called the enterprise in government which they're doing some business in now. So the question is, besides Amazon, there's other guys. >> Yeah. >> Verizon, the Telco's have been really trying to figure out what to do with over the top for years. (laughs) Now they're also powering a lot of multi-tenant workloads as well including their own stuff. >> Yeah. >> So Telco and service providers out there, what are they doing because they're still critical infrastructure around the world? >> So actually I think if we just use Amazon as a reference point or example, Amazon initially didn't worry about security but then over the last few years, worked hard to integrate security into their offering. We're now in the early stages of seeing that from, for example carriers like Verizon, where in the past Verizon was saying first secure yourself then in the last two years, Verizon said, "Okay, here's "some products and services you can buy." Now where we're heading is what they're trying to make the network inherently secure. A lot of the basic components like device matching to identity matching, basically-- >> Yeah. >> Making that a part of the underlying fabric. So I think the good news is as-- >> So they're making advances there? >> Yeah. >> Well they have networks. >> Yeah. >> They know networking. >> Yeah, so the good news is as bleak as this all seems, we are making significant progress as an industry and as a country. Having said that, my only warning is you still need an executive team, a security team that knows how to leverage all of these components and pull them together. And that goes back to having a risk based approach and protecting the most important things. And I think if you can do that, I think the tool set that's come out now is actually pretty sophisticated. >> So final question, I want to get your thoughts and we can end this segment and then we'll talk a little bit about Vidder and your company. But I asked Pat Gelsinger, CEO of VMware, at VMworld just recently about the security do-over. Because Dave Vellante asked him years ago. >> Yeah. >> He said, "Absolutely, there's going to be a do-over!" So Pat Gelsinger is right again. The guy's like Nostradamus when it comes to tech trends. He's a wave guy from Intel so he gets the waves. But I asked him about that question again this year and I'll send the clip on Twitter. I'll put it out on Twitter, I'll make a link to it. He said that 5G is going to be the big kahuna of the next 30 years and he thinks that 5G starts to get out it's going to deliver 10 X number of antennas, 100 extra bandwidth, new spectrum allocations, 100 X new devices, that are all going to be connected as well. As you mentioned we're a connected world. This brings up the edge of the network he says, "Next five years is going to... "Next 30 years is going to be a massive build out." >> Yeah. >> So okay, 5G is coming. Industrial IOT, IOT, the Internet of Things is happening. How is this going to change the security game? Because now you have networking and you see VMware doing NSX and Cisco's been trying to get to the enterprise figuring out the virtualization on a network level. Everything comes back down to the network. Is that where the action is because it seems to me that the network guys have to figure this out and that seems to be the point of reference of the terms of opportunity or is it a challenge or is it moving up the stack? How does all the networking changes happen? >> So for IOT we really need two things to happen. I think one is we actually don't have a security standard for IOT devices and specifically the issue is malware. IOT devices and their software is made worldwide. And I think one of the biggest policy weaknesses we have right now is there's no minimum standard. This needs to be solved otherwise we're in a lot problem. But in parallel to that, there is a lot of technical development. One of the things that's happening in the networking world is for the past 20 years we were driven by what's called a network VPN, or layer three VPN, it's your classic VPN that connects a device to a server. The problem with that is if you have malware on the device it gets through. So there's this new kind of VPN which is an application VPN, or we call it a layer four, which is basically a softer process in the device to a softer process in a server. So that's kind of the new model which is-- >> So make the network as dumb as possible and go up the stack and attack it? >> Yeah, well not so much-- >> Well I'm over simplifying-- >> Or reaction-- >> The network guys are going to roll in the-- >> I was going to use a different term. I was going to say make the-- >> The dumb pipes. >> Make the network application aware so that it only lets applications get through not any kind of connection. So I think that is something happening. >> Well the networks have to be smarter. >> Yeah, so-- >> That enable the smartness. >> So smarter networks are happening and it's an area that I work in, it's very excited. >> I don't mean to offend you by saying dumb network. >> Yeah, but the application... To be clear though, that's just one piece of the puzzle. The other piece of the puzzle, which unfortunately is a little bit lacking, is there's no standards for IOT software today. >> Yeah. >> And unless we have concepts like secure boot that is the software can't be tampered with, I think unfortunately there's a bit of risk. But I'm hopeful-- >> And then IOT, for the folks watching that might not be in the inside baseball know it's a surface area problem. There's more points of attack-- >> Yeah. >> Vectored. So we're talking about the compliance thing. >> Not only are there more attacks, by and large IOT devices are made outside the United States. Physically they're made in China and a lot of the software comes from India and there's nothing wrong with that but the global supply chain provides plenty of opportunities for cyber attackers to inject in their code. >> Yeah. >> And this is something we need to watch very carefully and then like I said-- >> So this is actually one of those weird derivative results of outsourcing. >> Yeah. >> That American companies have realized that it's a problem. >> Yeah. So it's-- >> Is that right? >> Yeah so it's something we need to watch carefully. >> Okay, thanks for coming on theCUBE. >> Thank you. >> We really appreciate you sharing your perspectives. Tell me what Vidder, your president and CTO, you guys are in the security business, obviously you're an expert. With great call we'll have you back on multiple times. We'd love to get your commentary as we follow all the security trends. We have a Cyber Connect Conference with Centrify-- >> Yeah. >> Coming up in New York. We're covering GovCloud, AWS, and all the other players out there. What's Vidder doing? What's the company do for products? How do you guys sell, who's your customers, and what are the cool things you're doing? >> We've developed a access control solution based on a new standard called Software Defined Perimeter. And there's two things that are unique about it. First with a name like, technology is like Software Defined Perimeter, we work in the cloud in the data center but more importantly we're able to stop existing attacks and emerging attacks. So things like password theft, credential theft, or server exploitation, we stop because we don't allow connections from unknown devices or people. But the other thing is say you're known and you connect to a server, we basically look inside your laptop and only allow the authorized process to connect to the server. So if there's malware on the device it can actually make it through. >> So it's just on the malware? >> That's right. >> If you want to sneak through-- >> That's right. >> You're going to shut that down. >> We can't stop the malware from getting on the device but we can make sure it doesn't get to the other side. >> So it doesn't cross-pollinate. >> Yeah, yeah. >> It doesn't go viral. >> That's right. So a lot of the stuff we do is very important. We work with a range of big-- >> You have government, obviously, contracts. >> Yeah, we-- >> I'm sure you have, that you can't talk about, but you do, right? >> We do a little bit of work with the government and we're just working with Verizon which is public, where they wish to create services where malware actually can't go through the connections. So we're doing exciting stuff and we're-- >> Enterprise customers at all? >> Yeah, yeah. We have banks-- >> People who are on high alert. >> That's right, yeah. >> You guys are the tier one. >> That's right. >> Where if the houses are burning down-- >> Yeah. >> You're there. >> So we do banks and we just started doing work at a hospital where, again, it's HIPAA compliant and they need to make sure that data doesn't leave the hospital. So what's the number one thing that you guys have? Is Ransomware something that you solve? What areas do you guys... Being called in? What's the big fire bell, if you will, they ring the bell, when do you come in? What's the thing? Just in general or? >> Our number one reason for existing is stopping attacks on application servers or servers that hold data. That's kind of our focus so if you have data or an application that someone is after, we will make sure that nobody gets to that data. In fact we'll even make sure if there's a spy or insider attacker who comes into your organization they'll only be able to do what they're allowed to do and won't be able to do anything else. >> So on the Equifax news that was big, would you guys help there if they were a customer or is that just a different thing? >> No, we could've helped because one of the things that happened is they used a server exploit to basically propagate through their data center. So we probably wouldn't have done much on the initial exploit but we would've kept it from going deeper into the system. >> And they hid for four months and they were poking around so you would've detected them as well. >> Yeah, we certainly would've stopped all the poking around because we basically... You can think of us as identity based access control mechanism so based on your identity you can only do very specific things. And in their case, they had the identity of the user. We wouldn't have let them do anything except maybe just go to one website. >> Yeah, you would shut them down manually. >> That's right. >> They should've been doing business with Vidder. Junaid thank you for coming on theCUBE here for the CUBEConversation. In Palo Alto, California I'm John Furrier with the CUBEConversation. Thanks for watching. (the Cube jingle)

>> Narrator: Live from Las Vegas, it's the Cube covering VMworld 2017. Brought to you by VMware and it's ecosystem partners. >> Hey. Welcome back everyone. Live here in Las Vegas, this is the Cube's exclusive coverage of VMworld 2017. Now I'm John Furrier, the co-host of the Cube with my partner Dave Vellante co-host. Eighth year of Cube coverage at VMworld's since 2010, we've been documenting the evolution of VMware. Next guest is Bask Iyer, who's the CIO of Vmware and Dell. Big time CIO, been in the field. Been in working, real practitioner. Now at the company. Going to the cloud. Hybrid cloud. Bask great to see you. >> Good to see you. Yeah. >> So, Pat Kelson's keynote really relevant. I just want to say, you know our conversation last year and even the year before, you're like Nostradamus. You're like predicting the future. We talk about IoT's and now IoT edge. Are you helping messaging it with Vmware, I mean? >> Well my background having working in Honeywell and so on is that and I saw IoT as a big opportunity. So, it was easy for me to see that it was going to be big but I didn't see, think it was this big. But I'm messaging more with CIOs, more than Vmware to say you're going to miss this wave. It looks like a lot of CIOs are so focused on business IT, they're missing IoT. So, my message is here's a great opportunity for you to get ahead of don't miss it. >> I want to talk about waves cause last year we really made and then you look at what Pat Kelson did last year. We were commenting that he gave the speech of his life. Was that two years ago I can't remember. He really was like under a lot of pressure. His toggle was like a 42, very low. Is he the right guy? He made some bets. Pat's a wave guy. He's all about the waves cause he said, "If you're not out for that next wave, you become drift wood." So, I got to ask you the question. By the way, he's got the great wave slide here. From a customer perspective, they're watching here, Gelsinger lay out a great vision, the stock price is booming, strategy is clear. Andy Jassy from Amazon comes on stage. There is clarity in this direction and the waves that you are on. Now customers have to make the choice of bets, they're looking at the waves and saying what are my bets; The question I have for you what bets are customers making now as CIO and what should they look at, in what sequence, how do they attack those bets and which are the right bets? >> So I think the cloud is a big bet. People don't want to talk about cloud because they think we have been talking about it for a long time but enterprise hasn't really gone much in the journey. There is still a lot of data centers running virtual machines which is great but you really don't have a private cloud set up and then this burst capacity do go to public cloud and so very few people have examples of that. There are some people but not the large majority. What happens in IT is, when you get spooked when you see a public cloud and a private cloud and your not sure which way it's going. So the nice thing about this announcement is that thing's mystery is out right. So you want to go to public cloud here's the way to get it. You want to stay in your private cloud here's the way you can stay in your private cloud. Plus moving legacy applications people never talk about legacy. They always talk about you know if you and I are building a new company to go to a public cloud, do cloud ready, pretty easy. But I have some old applications even in a technology company, how do I move it? So I think that as a customer when I look at past message they said that make sense to me, I can choose to run it on my data center, go to a private cloud and go into Amazon. >> I got to ask you, I know Dave was jumping he's got some good private cloud data to talk about. About a true private cloud data. You mentioned how hard it is to move legacy apps, can you give some illustration and some color to how hard it is. Because a lot of people in the press analyst even startups, It's so easy, I want to just win the enterprise. If it's a clean sheet of paper I get that but there is a lot of important things. How hard is it to really deal with this legacy data center environment in the path to hybrid and public cloud? >> Well there is still, you know people think of, if you think of an ERP, people have four or five ERPs still. You know you were just imagining everybody is just on one nice SAP or one nice Oracle. There are several instances and the reason we haven' migrating to one is not because is not because we don't know how to do it, there is an ROI you know, do I invest the money, do I do this right now, do I get the people, another $400 million to invest in an ERP system. >> Risky. >> Very risky. So you got a lot of these. You've got PeopleSoft which has different versions. You got HR systems, sale systems. So that's what in a lot of data centers believe it or not. How do you move it? Then when you go to a public cloud the guy says are you cloud ready? No you're not. You got a legacy system. >> What's that? >> You just don't want to run this. You want to run it in the most efficient way within a container. So I think people don't see that. The other thing they don't see is at scale it is expensive sometimes to go to public cloud. If you and I are starting a company, we won't build a data center we can probably go to the public cloud. But if I have scale, I already have data centers that I am running at scale and not everything is unpredictable. A lot of business IT is very predictable workloads, right. I know what I need to buy next year generally. So what burst capacity am I looking for? Not everybody requires that, so that's another reason. Security both ways right, people say that public cloud is more secure but there is a lot of regulatory bodies who want you to show and there is a lot of work that I have to certify to show that. So what [CIS 00:05:30] is trying to do is to say we will try to go cloud where we can but there is still 80% 90% of your stuff running in a data center. Help me bridge that. >> Well we talk about cloud, private cloud, we coin this term true private cloud and the basic concept is bring the cloud model to your data. >> Right. >> We tell our CIOs, look don't try to form your business and fit it into the cloud. Fit the cloud into your business wherever the data lives. >> Yeah. >> Is that a reasonable way to look at it and is that what you're doing with your business? >> Yeah, so I'd define it a even more simply. I'd kind of say if you have a lot of people running your data center, you don't have a cloud. I mean the whole point of cloud is automation. The reason public clouds are cheaper or better is because it is highly automated. So that's the trick. If you have people in the data center then it's not a cloud. So get your data center modernized. I define it as private cloud you can call it whatever you want, you can call it automation. But get it automated. Then the scale comes up and your cost comes down. But then when you want burst capacity you don't have to build servers for that you can go to the public cloud for burst capacity. But the big point for me is, people ought to sit down and figure out a strategy. Few years ago people said don't go into infrastructure just outsource it. So we all outsource it and that became a mess. Sooner or later you got to figure out what you need to do. You can't just outsource it, put it in the cloud, not think about it, make it go away. So you see a lot of CIOs coming back and saying I want that but I also want to fix this, how do I automate? I want to get the cost down. That's how I define a private cloud don't have too much cost. >> So are you running a private cloud or? >> Not only am I, I should be modest but I'm not going to be. I think we run one of the best private clouds there is for VMware. Everything that you see in Vmware, the hands on labs you see there is all running on a private cloud at scale. We are extending the cloud to now Dell Technologies. We are taking the same model and cut and paste it. Imagine how much leverage you get from EMC and Dell Data Centers when you extend the private cloud. So for a company like us it's a sure bet. >> So what is it look like underneath? I mean you got vSan running. >> Yeah. You have vSan, NSX everything we talk about. >> Have you thrown out all your arrays? >> No, you don't throw out all our arrays but vSan is. What you see in the market is happening in my data center. So vSan is, there is more and more vSan nodes now but your mission critical SAP and Oracle stuff that I don't want to necessarily save dollars I would want something that is mission critical, proven, ready, certified, etc. So the other things don't go away but your storage is growing. As the storage grows you see a lot more of the vSan growing with that. I use to have a lot of vSan, a lot of NSX. >> You know how many clusters you have now? Probably a zillion. I mean a pretty large number. >> It's a large number of clusters. >> It's just a, the reason I don't know is every month they just amazingly growing. Last year when we talked about it when you asked the question about vSan there was only a few left in my data center. So I deliberately dint talk a whole lot about it. Now it's taking on like fire. >> Yeah >> Right, as the reliability increases, the cost value proposition is taking off. >> Your talking about tens of thousands of vms and petabytes of data. >> Yeah, multiple petabytes of data. Over 60% of that is growing. The growth mark is really large in the vSan as well. >> I got to ask you the journey for the CIO and the CXOs out there, cause there's multiple CXOs. You've got chief security officers, some say chief economic officer because of crypto currency block chains coming around the corner. We got to talk about block chains because next year it's going to be in the wave slide. Cause decentralization is all about block chain. There should be a computing areas there. They all want to get in, they don't want to screw up. I need the head room but I don't want to make any move too early to get over my skis or foreclose an opportunity. So what's the path, Are they getting there house in order with the private cloud as a stepping stone to hybrid cloud. What are some of the day in life of the CIO right now because what we're seeing with the data is true private cloud on premise is growing really well. It's not declining in any capacity. That where the action is right now more than hybrid clouds. >> Yeah >> What's the CIO doing, is that the trend that you see, what's going on in their world? >> Well there are three or four things going. Then their SAS application that compute is going with that SAS vendor. So that is happening a bit. But I see the private cloud growing. Right, you know, I don't see it disappearing anywhere and I talked to my other CIOs and say should I be saying this or is it true or not? And everybody say yes it is growing and so is SAS and so is public cloud. But you know, a big majority of Vmware Compute is run on a private cloud and so I see it grow. So what the CIO's would look for is I want to run my private cloud efficiently but I also want to I don't want to have this large boxes for burst capacity. Say I have a Thanksgiving sale or a Christmas sale I don't want to have boxes sitting doing nothing. Can I take advantage of the public cloud for that and then cloud ready when I want to do some experiments on the newer development, let me try it on the public cloud. My feeling is my stats tells me and you guys are the experts on it is. If you have a scale at some scale, if your on a good private cloud the costs are going to be better for you. That's what my experience tells me. >> Because some of the things are predictable like hey retail seasons here, I can go burst in the cloud for that. >> Right. >> Then everything else kind of overflow to the cloud auto scaling. >> The key is labor. >> Yeah >> You could take labor out. So I just want to share some numbers with you guys. >> Sure. >> We so, what we call the true private cloud you're calling private cloud. >> Yeah. >> Growing at 33% vs the infrastructure as a service for the public cloud going at 15%. >> Wow. >> It's a 10 year forecast. We have true private cloud at 230 billion. The infrastructure as a service public cloud at 150 billion. So the biggest market growing the fastest to your point, SAS is bigger than both. >> Right. >> That's growing really really fast but it's the IT labor piece $150 billion coming out of labor going into, then their R&D and shifting to analytics and >> Value. >> Transformations, value producing things. >> I think that is the transformation. The transformation is labor is going out, automation is coming in. So I can put that on DevOps or the business kind of transformation projects. That's good to see. That's where intuitively as a practitioner I say, but it's good to have the data. I'm going to go read it up and see. That makes a lot of sense to me. >> Pat Gelsinger actually made a quote on the keynote I thought this is why I was honed in on that is that. He actually said shifting to value activities. That's analytics, you called vendor R&D which is basically a way to fund some of the new project where the hybrid and public are being operationalize to be predictable to some level. >> Sure exactly. >> But I totally see that the hybrid cloud is stalled in my opinion you guys can comment on it but based on my anecdotal hundreds of shows we go to it's hyped up beyond all recognition. >> Yeah. >> But it's happening after private cloud is set up because the operating model of the clouds got to get set up and it's just a law for the enterprises. >> Good points, maybe bursting, maybe some DR, but it's not a federated, set a federated apps or is it. >> At least I don't see it that way. I mean so things should be simple but not simpler is what they say. You got to get your house in order. I mean you can't, I mean I made the mistake of saying let's just outsource it because I don't want to think about it. This is the same thing that we are talking about let's just put it all in the cloud. What do you mean, I mean there are legacy apps. You still have them running at a good cost. You still have to know it. So I'm little old fashioned that way to say your house in order and have the options open for burst and other kind of things that you want to do. >> Well digital transformation also has a lot of pressure on top line revenues. So now >> Yeah. >> You can't just put the paint a side and not look at it. >> Sure. >> Put it in the corner. >> But look, IoT, we talked about this. You're going to have to set your whole business being censored. That needs a lot of late latency and other kind of issues lot of data. You need to be better have a good private cloud story for the IoT. Not everything can be put on the public cloud to make it happen. They just don't have the latency. There's law of physics still. So like a car is going to be a data center more less right, you need to make a response in a very short time. Factories have to have responsive systems and robotics. You can't go traverse the internet, go get a data from a public cloud, come back to make a decision on robot. So don't ignore as all I'm saying. Do everything but don't ignore it. >> The future, let's talk about future. AI is here, that's all also hyped up beyond all recognition but I love AI because it's got a software aspect to it. Machine learning super relevant. Block chain, Pat Gelsinger in his keynote really address and I thought a really clever way to weave this in, decentralization. >> Yeah. >> I see we all know it distributed computing is. >> Sure. >> Centralized database can be hacked. Distribution and decentralization around blockchain is interesting. So if we're putting our futuristic hats on. >> Yeah. >> What is IT look like in a totally non controllable, fully instrumented, blockchain crypto currency market? Is there going to be IT coins? I want some IT. >> I think so, I mean it's exciting, the only the thing with blockchain in enterprise is not the technology, it's our ability to think creatively on it. Right we are not able to envision these kind of things yet. It'll come in a year, I think it's our. We have to sit down and think about how to take advantage of that it's pretty exciting and you know we still have simple issues on you know. We know we can't centralize everything. That we've tried for years and years and years it's gone already. Now I want to decentralized, perhaps use technology like this to make sure I can still control what I want to control right. So the thing with block chain internally when I talk to people is, don't show me a proof of concept of technology I get the tech. What is the use case? >> Yeah. >> So we have to use our brains and I think in 6 months we will have it. We're just not there yet completed . >> That's where the destruction vector will be. >> Right. >> If anyone is doing in IT coin token you can say I'm interested. >> IoT we talked last time it looked like vaporware and now we have examples and every bodies doing it. I think block chain is definitely there. >> I mean supply chain could be applied to network with packets as we would say at the edge. Bask thanks for coming on the Cube. >> Sure, thank you. >> Great stuff good to see you. Cube coverage live here in Las Vegas with Vmworld 2017. We'll be right back with more coverage after this break. Thank you.

>> Narrator: It's theCUBE covering Sapphire Now 2017 brought to you by SAP Cloud Platform and HANA Enterprise Cloud. >> Welcome back everyone to our special Sapphire Now 2017 coverage in our Palo Alto Studios. We have folks on the ground in Orlando. It's the third day of Sapphire Now and we're bringing our friends and experts inside our new 4500 square foot studio where we're starting to get our action going and covering events anywhere they are from here. If we can't get there we'll do it from here in Palo Alto. Our next guest is Satyen Sangani, CEO of Alation. A hot start-up funded by Custom Adventures, Catalyst Data Collective, and I think Andreessen Horowitz is also an investor? >> Satyen: That's right. >> Satyen, welcome to the cube conversation here. >> Thank you for having me. >> So we are doing this special coverage, and I wanted to bring you in and discuss Sapphire Now as it relates to the context of the biggest wave hitting the industry, with waves are ones cloud. We've known that for a while. People surfing that one, then the data wave is coming fast, and I think this is a completely different animal in the sense of it's going to look different, but be just as big. Your business is in the data business. You help companies figure this out. Give us the update on, first take a minute talk about Alation, for the folks who aren't following you, what do you guys do, and then let's talk about data. >> Yeah. So for those of you that don't know about what Alation is, it's basically a data catalog. You know, if you think about all of the databases that exist in the enterprise, stuff on Prem, stuff in the cloud, all the BI tools like Tableau and MicroStrategy, and Business Objects. When you've got a lot of data that sits inside the enterprise today and a wide variety of legacy and modern tools, and what Alation does is, it creates a catalog, crawling all of those systems like Google crawls the web and effectively looks at all the logs inside of those systems, to understand how the data is interrelated and we create this data social graph, and it kind of looks >> John: It's a metadata catalog? >> We call you know, we don't use the word metadata because metadata is the word that people use when you know that's that's Johnny back in the corner office, Right? And people don't want to talk about metadata if you're a business person you think about metadata you're like, I don't, not my thing. >> So you guys are democratizing what data means to an organization? That's right. >> We just like to talk about context. We basically say, look in the same way that information, or in the same way when you're eating your food, you need, you know organic labeling to understand whether or not that's good or bad, we have on some level a provenance problem, a trust problem inside of data in the enterprise, and you need a layer of you know trust, and understanding in context. >> So you guys are a SAS, or you guys are a SAS solution, or are you a software subscription? >> We are both. Most of this is actually on Prem because most of the people that have the problem that Alation solves are very big complicated institutions, or institutions with a lot of data, or a lot of people trying to analyze it, but we do also have a SAS offering, and actually that's how we intersect with SAP Altiscale, and so we have a cloud base that's offering that we work with. >> Tell me about your relation SAP because you kind of backdoored in through an acquisition, quickly note that we'll get into the conversation. >> Yeah that's right, So Altiscale to big intersections, big data, and then they do big data in the cloud SAP acquired them last year and what we do is we provide a front-end capability for people to access that data in the cloud, so that as analysts want to analyze that data, as data governance folks want to manage that data, we provide them with a single catalog to do that. >> So talk about the dynamics in the industry because SAP clearly the big news there is the Leonardo, they're trying to create this framework, we just announced an alpha because everyone's got these names of dead creative geniuses, (Satyen laughs) We just ingest our Nostradamus products, Since they have Leonardo and, >> That's right. >> SAP's got Einstein, and IBM's got Watson, and Informatica has got Claire, so who thought maybe we just get our own version, but anyway, everyone's got some sort of like bot, or like AI program. >> Yep. >> I mean I get that, but the reality is, the trend is, they're trying to create a tool chest of platform re-platforming around tooling >> Satyen: Yeah. >> To make things easier. >> Satyen: Yeah. >> You have a lot of work in this area, through relation, trying to make things easier. >> Satyen: Yeah. >> And also they get the cloud, On-premise, HANA Enterprise Cloud, SAV cloud platform, meaning developers. So the convergence between developers, cloud, and data are happening. What's your take on that strategy? You think SAP's got a good move by going multi cloud, or should they, should be taking a different approach? >> Well I think they have to, I mean I think the economics in cloud, and the unmanageability, you know really human economics, and being able to have more and more being managed by third-party providers that are, you know, effectively like AWS, and how they skill, in the capability to manage at scale, and you just really can't compete if you're SAP, and you can't compete if your customers are buying, and assembling the toolkits On-premise, so they've got to go there, and I think every IT provider has to >> John: Got to go to the cloud you mean? >> They've got to go to the cloud, I think there's no question about it, you know I think that's at this point, a foregone conclusion in the world of enterprise IT. >> John: Yeah it's pretty obvious, I mean hybrid cloud is happening, that's really a gateway to multi-cloud, the submission is when I build Norton, a guest in latency multi-cloud issues there, but the reality is not every workloads gone there yet, a lot of analytics going on in the cloud. >> Satyen: Yeah. >> DevTest, okay check the box on DevTest >> Satyen: That's right. >> Analytics is all a ballgame right now, in terms of state of the art, your thoughts on the trends in how companies are using the cloud for analytics, and things that are challenges and opportunities. >> Yeah, I think there's, I think the analytics story in the cloud is a little bit earlier. I think that the transaction processing and the new applications, and the new architectures, and new integrations, certainly if you're going to build a new project, you're going to do that in the cloud, but I think the analytics in a stack, first of all there's like data gravity, right, you know there's a lot of gravity to that data, and moving it all into the cloud, and so if you're transaction processing, your behavioral apps are in the cloud, then it makes sense to keep the data in an AWS, or in the cloud. Conversely you know if it's not, then you're not going to take a whole bunch of data that sits on Prem and move it whole hog all the way to the cloud just because, right, that's super expensive, >> Yeah. >> You've got legacy. >> A lot of risks too and a lot of governance and a lot of compliance stuff as well. >> That's exactly right I mean if you're trying to comply with Basel II or GDPR, and you know you want to manage all that privacy information. How are you going to do that if you're going to move your data at the same time >> John: Yeah. >> And so it's a tough >> John: Great point. >> It's a tough move, I think from our perspective, and I think this is really important, you know we sort of say look, in a world where data is going to be on Prem, on the cloud, you know in BI tools, in databases and no SQL databases, on Hadoop, you're going to have data everywhere, and in that world where data is going to be in multiple locations and multiple technologies you got to figure out a way to manage. >> Yeah. I mean data sprawls all over the place, it's a big problem, oh and this oh and by the way that's a good thing, store it to your storage is getting cheaper and cheaper, data legs are popping out, but you have data links, for all you have data everywhere. >> Satyen: That's right. >> How are you looking at that problem as a start-up, and how a customer's dealing with that, and what is this a real issue, or is this still too early to talk about data sprawl? >> It's a real issue, I mean it, we liken it to the advent of the Internet in the time of traditional media, right, so you had you had traditional media, there were single sort of authoritative sources we all watched it may be CNN may be CBS we had the nightly news we had Newsweek, we got our information, also the Internet comes along, and anybody can blog about anything, right and so the cost of creating information is now this much lower anybody can create any reality anybody can store data anywhere, right, and so now you've got a world where, with tableau, with Hadoop, with redshift, you can build any stack you want to at any cost, and so now what do you do? Because everybody's creating their own thing, every Dev is doing their own thing, everybody's got new databases, new applications, you know software is eating the world right? >> And data it is eating software. >> And data is eating software, and so now you've got this problem where you're like look I got all this stuff, and I don't know I don't know what's fake news, what's real, what's alternative fact, what doesn't make any sense, and so you've got a signal and noise problem, and I think in that world you got to figure out how to get to truth, right, >> John: Yeah. And what's the answer to that in your mind, not that you have the answer, if you did, we'd be solving it better. >> Yeah. >> But I mean directionally where's the vector going in your mind? I try to talk to Paul Martino about this at bullpen capital he's a total analytics geek he doesn't think this big data can solve that yet but they started to see some science around trying to solve these problems with data. What's your vision on this? >> Satyen: Yeah you know so I believe that every I think that every developer is going to start building applications based on data I think that every business person is going to have an analytical role in their job because if they're not dealing with the world on the certainty, and they're not using all the evidence, at their disposable, they're not making the best decisions and obviously they're going to be more and more analysts and so you know at some level everybody is an analyst >> I wrote a post in 2008, my old blog was hosted on WordPress, before I started SilicionANGLE, data is the new developer kid. >> That's right. >> And I saw that early, and it was still not as clear to this now as obvious as least to us because we're in the middle, in this industry, but it's now part of the software fabric, it's like a library, like as developer you'd call a library of code software to come in and be part of your program >> Yeah >> Building blocks approach, Lego blocks, but now data as Lego blocks completely changes the game on things if you think of it that way. Where are we on that notion of you really using data as a development component, I mean it seems to be early, I don't, haven't seen any proof points, that says, well that company's actually using the data programmatically with software. >> Satyen: Yeah. well I mean look I think there's features in almost every software application whether it's you know 27% of the people clicked on this button into this particular thing, I mean that's a data based application right and so I think there is this notion that we talked a lot about, which is data literacy, right, and so that's kind of a weird thing, so what does that exactly mean? Well data is just information like a news article is information, and you got to decide whether it's good or it's bad, and whether you can come to a conclusion, or whether you can't, just as if you're using an API from a third-party developer you need documentation, you need context about that data, and people have to be intelligent about how they use it. >> And literacies also makes it, makes it addressable. >> That's right. >> If you have knowledge about data, at some point it's named and addressed at some point in a network. >> Satyen: Yeah. >> Especially Jada in motion, I mean data legs I get, data at rest, we start getting into data in motion, real-time data, every piece of data counts. Right? >> That's exactly right. And so now you've got to teach people about how to use this stuff you've got to give them the right data you got to make that discoverable you got to make that information usable you've got to get people to know who the experts are about the data, so they can ask questions, you know these are tougher problems, especially as you get more and more systems. >> All right, as a start up, you're a growing start-up, you guys are, are lean and mean, doing well. You have to go compete in this war. It's a lot of, you know a lot of big whales in there, I mean you got Oracle, SAP, IBM, they're all trying to transform, everybody is transforming all the incumbent winners, potential buyers of your company, or potentially you displacing this, as a young CEO, they you know eat their lunch, you have to go compete in a big game. How are you guys looking at that compass, I see your focus so I know a little bit about your plan, but take us through the mindset of a start-up CEO, that has to go into this world, you guys have to be good, I mean this is a big wave, see it's a big wave. >> Yeah. Nobody buys from a start-up unless you get, and a start-up could be even a company, less than a 100-200 people, I mean nobody's buying from a company unless there's a 10x return to value relative to the next best option, and so in that world how do you build 10x value? Well one you've got to have great technology, and then that's the start point, but the other thing is you've got to have deep focus on your customers, right, and so I think from our perspective, we build focus by just saying, look nobody understands data in your company, and by and large you've got to make money by understanding this data, as you do the digital transformation stuff, a big part of that is differentiating and making better products and optimizing based upon understanding your data because that helps you and your business make better decisions, >> John: Yeah. >> And so what we're going to do is help you understand that data better and faster than any other company can do. >> You really got to pick your shots, but what you're saying, if I hear you saying is as a start-up you got to hit the beachhead segment you want to own. >> Satyen: That's right. >> And own it. >> Satyen: That's exactly. >> No other decision, just get it, and then maybe get to a bigger scope later, and sequence around, and grow it that way. >> Satyen: You can't solve 10 problems >> Can't be groping for a beachhead if you don't know what you want, you're never going to get it. >> That's right. You can't solve 10 problems unless you solve one, right, and so you know I think we're at a phase where we've proven that we can scalably solved one, we've got customers like, you know Pfizer and Intuit and Citrix and Tesco and Tesla and eBay and Munich Reinsurance and so these are all you know amazing brands that are traditionally difficult to sell into, but you know I think from our perspective it's really about focus and just helping customers that are making that digital analytical transformation. Do it faster, and do it by enabling their people. >> But a lot going on this week for events, we had Informatica world this week, we got V-mon. We had Google I/O. We had Sapphire. It's a variety of other events going on, but I want to ask you kind of a more of a entrepreneurial industry question, which is, if we're going through the so-called digital transformation, that means a new modern era an old one movie transformed, yet I go to every event, and everyone's number one at something, that's like I was just at Informatica, they're number one in six squadrons. Michael Dell we're number in four every character, Mark Hurr at the press meeting said they're number one in all categories, Ross Perot think quote about you could be number one depends on how you slice the market, seems to be in play, my point is I kind of get a little bit, you know weirded out by that, but that is okay, you know I guess theCUBE's number one in overall live videos produced at an enterprise event, you know I, so we're number one at something, but my point is. >> Satyen: You really are. >> My point is, in a new transformation, what is the new scoreboard going to look like because a lot of things that you're talking about is horizontally integrated, there's new use cases developing, a new environment is coming online, so if someone wanted to actually try to keep score of who number one is and who's winning, besides customer wins, because that's clearly the one that you can point to and say hey they're winning customers, customer growth is good, outside of customer growth, what do you think will be the key requirements to get some sort of metric on who's really doing well these are the others, I mean we're not yet there with >> Yeah it's a tough problem, I mean you know used to be the world was that nobody gets fired for choosing choosing IBM. >> John: Yeah. >> Right, and I think that that brand credibility worked in a world where you could be conservative right, in this world I think, that looking for those measures, it is going to be really tough, and I think on some level that quest for looking for what is number one, or who is the best is actually the sort of fool's errand, and if that's what you're looking for, if you're looking for, you know what's the best answer for me based upon social signal, you know it's kind of like you know I'm going to go do the what the popular kids do in high school, I mean that could lead to you know a path, but it doesn't lead to the one that's going to actually get you satisfaction, and so on some level I think that customers, like you are the best signal, you know, always, >> John: Yeah, I mean it's hard, it's a rhetorical question, we ask it because, you know, we're trying to see not mystical with the path of fact called the fashion, what's fashionable. >> Satyen: Yeah. >> That's different. I mean talk about like really a cure metro, in the old days market share is one, actually IDC used a track who had market shares, and they would say based upon the number of shipments products, this is the market share winner, right? yeah that's pretty clean, I mean that's fairly clean, so just what it would be now? Number of instances, I mean it's so hard to figure out anyway, I digress. >> No, I think that's right, I mean I think I think it's really tough, that I think customers stories that, sort of map to your case. >> Yeah. It all comes back down to customer wins, how many customers you have was the >> Yeah and how much value they are getting out of your stuff. >> Yeah. That 10x value, and I think that's the multiplier minimum, if not more and with clouds and the scale is happening, you agree? >> Satyen: Yeah. >> It's going to get better. Okay thanks for coming on theCUBE. We have Satyen Sangani. CEO, co-founder of Alation, great start-up. Follow them on Twitter, these guys got some really good focus, learning about your data, because once you understand the data hygiene, you start think about ethics, and all the cool stuff happening with data. Thanks so much for coming on CUBE. More coverage, but Sapphire after the short break. (techno music)

>> Announcer: It's theCube. Covering SAPPHIRE NOW 2017. Brought to you by SAP Cloud Platform in HANA Enterprise Cloud. >> Welcome to the special Cube conversation covering SAP SAPPHIRE 2017 in Orlando. I'm John Furrier here for special coverage. Our next guest is Margaret Anderson, Senior Vice President of the SAP HANA Enterprise Cloud. Thanks for joining me today. Talking about the news and the relationships, what's happening around SAPPHIRE. A lot of great things are happening. One of the super exciting thing that we're seeing is, this notion of multi-cloud, this notion of customer value. Starting to see some visibility into a clear line of sight around how the technology in the cloud can be put into use. You guys have some exciting news around some of your partnerships with Cisco and CenturyLink. Tell us about that. >> Yeah we're very excited about that. In the sense that, customers are always asking us, why the cloud and why now. Why don't I just stay with what I have. And we keep telling them that as technology changes, we want to be on top of it for them. And they don't have to think about it. They just have to use it. So we're making it easier for them to consume our technology. But for us to be able to do that, we need partners. We need partners that can be the backbone inside the cloud. Because the cloud is supported by equipment, machinery, systems, all sorts of things that we don't really want the customer to worry about that. We want the customer to consume the services. We want them to run their business. So when we formed the partnership with the Cisco and CenturyLink team, the best thing about it is the fact that we have a partner who creates the engine, who puts together our HANA reference architecture, who sets everything up so the customer doesn't have to think about it. And then we have the CenturyLink team, who provides all the services. They make sure everything works. They listen to what the customer needs and they make sure it all runs together. >> This is important and I want to highlight this and I want to ask another followup question on that. I think this really speaks to the cloud transformation we're seeing. Digital transmission, whatever you want to call it. Certainly it's the cloud, it's data. And Bill McDermott has been on this for years. It's our eighth year of covering SAPPHIRE. He was showing data dashboards years ago, so he's been Nostradamus in the whole vision there. But cloud has been a moving train. And your customers and CenturyLink customers and Cisco customers are constantly questioning themselves around their relationships that they have and the business that they run. This is important because what you're highlighting is, you guys have been no stranger to partnering. >> Correct. >> Now that the cloud stakes are high, the value to the customer at CenturyLink is that they can provide no disruption. I want to get into that a little bit. What at Sapphire is being announced that's going to help this. >> Well I think that customers are always interested in global reach. They might be starting locally in one country and they want to know that when they partner with us SAP, or when we SAP partner with someone else to help us, that when their business grows, we're ready for them and we can grow with them. And in the cloud, customers just assume that somewhere is all the equipment, somewhere the cloud runs. But today, security is really important for our customers. They want to know, can we comply with the rules for data sovereignty in various countries around the world. And they want to know if our partners, if we choose one to work with us, can also do that for them. >> I was just saying I was just having a conversation with a group of experts and influences this morning, on our crowd chat digital platform; question that came up is, what's the biggest misconception of dev-op or cloud in the enterprise? And the number one question that came up was oh, it's easy. That's the number one misconception. And it's not easy. [Margaret] Chuckles. There's a lot of things going on around compliance, governance, but also SLA performance around latency. Little things like, >> Yes. >> Moving packets around and making applications bulletproof and security. How does this relationship with CenturyLink and Cisco make that a reality for customers so they can be confident. Things are going to be secure, and these implementations are going to be reliable. >> Well first of all, at SAP we've defined a very specific reference architecture. So the Cisco team builds the environment for the customer according to that architectural standard. Our security team provides guidance on what the security standards have to be. And between our CenturyLink team and our Cisco team, they have to make sure that those standards are deployed. And that we are completely hack-proof. Because you know it, everybody out there trying to get into customer systems. Data is very valuable. Business knowledge could destroy you if a competitor could find something out about you. We want to promise our customers that everything is secure. And that we have a team of ace security experts and we all collaborate together to make sure that we can keep the environment safe. >> Cloud enabled IT infrastructure and application development and all these SLAs that are required in the cloud are going to be interesting. In our next segment, we're going to have Cisco and CenturyLink on. >> Umhmm. >> What are they going to be saying? When we ask them about the relationship what are some of the things they're going to say about what this all means for SAP, Cisco and CenturyLink. >> I think, I won't put words in anybody's mouth, but I know that the Cisco team, >> John: But we will. >> Is looking at the fact that they're doing a lot of business today on-premise. And customers are getting out of having their own data centers because it's not cost effective for them. So when the customers is thinking about the cloud, and they happen to like the environment that they have, they want to know that they can have a similar environment in the cloud. Because realistically, customers still ask the question, what's under the hood? What am I getting? How do I know that you can provide these SLAs? What are you doing to guarantee me the 99.9 uptime? So customers do ask us those questions. Cisco has excellent answers for those questions. And they also ask the CenturyLink team, what is your expertise in HANA and what is your expertise in running all the other applications that I might want to consume from SAP? So it's the combination of the engine and the people that make the success in the cloud. Because that's how we deliver the services to the customers. >> And also to complicate things, I would say that customers want things faster now. >> Yes they do. >> Not just faster latency and speed of solutions but performance but like deployments. I want it yesterday. That's a big factor, the deployment expectations for the customers are pretty high. >> Sometimes the customers think that they can call us up and they can say I'd like to do a cloud project. And then 24 hours later, magically, all sorts of stuff can appear. That's not always the case. Because every customer has a unique set of things that they'll like to see in the cloud. When they tell us what they need and we recommend how to set it up for them, we work with them on when to deliver it. And I've worked with customers on some very large implementation complicated projects, it still requires the same amount of thought process from an implementation perspective when you do it on-premise as if you do it in the cloud. Because you still have to think about what you want to use, and how you want to use it, and when you want to go-live. >> Lots going on at SAPPHIRE. Just to wrap up, we're going to bring on our guests from Cisco and CenturyLink in our next segment, talk about this relationship. But just in general, what's your perspective of the things that are happening right now around SAPPHIRE NOW 2017. What's the big exciting announcements if you can generalize the theme. What's the sentiment, what's the aroma of the buzz. >> Well, I would think first of all our new Leonardo announcement is going to generate an awful lot of excitement in the market. And I'm not going to steal anybody's thunder by talking some more about what that is. But I also think customers want to know that we are keeping up and that we are ahead of, more importantly, the technology trends. So when we have a big event like SAPPHIRE, we make sure to have announcements keyed up and ready to go. And each day we will tease them with releases of what some of these information is going to be. So that it generates excitement because post SAPPHIRE, we'll be doing a lot of followup conversations with our customers. >> One of the things I observed, just as anecdotal to that is that, I think, I like SAP. Always had good strategy with the data. As I mentioned about McDermott earlier, but I think the developer stake in the ground that was put in last year, around the IOS with the Apple, set the tone over the course of last year, hey, we're going outside of the SAP traditional developer, we're going to expand the reach of what a developer is. >> Margaret: Right. >> That cloud native view is very relevant. I think you're leading the charge on that. So congratulations. >> Well, we are. And we have converted what used to be the traditional on-premise software code lines into cloud code lines. And that means a lot of work internally that people may not realize that you just don't have what you used to have run one way and throw it into the cloud. You really have to think about and develop for specifically the cloud. >> Well, super impressed to see the partnership evolution where you're really bring the big players in partnership delivering real value. Congratulations. Thanks for coming on. In our next segment we're going to have Cisco and CenturyLink on to discuss the relationship with SAP, Cisco and CenturyLink. Great combination, up and down the stack. Great benefit for customers. Again thanks so much. This is theCUBE. More coverage of SAPPHIRE NOW after this short break.

>> Voiceover: Live from the Mandalay Bay Convention Center in Las Vegas, it's theCUBE covering VMworld 2016, brought to you by VMware and its ecosystem sponsors. Now here's your host, John Furrier. >> Welcome back everyone. We're here live at VMworld 2016 here in Las Vegas. This is the seventh year of coverage for SiliconANGLE Media's theCUBE, it's our flagship program, we go out to the events and extract the signal from the noise. I'm John Furrier. My co-host John Troyer with TechReckoning. Our next guest is CUBE alumn, one of our favorite guests, Sanjay Poonen who runs the end user computing, he's the General Manager, End User Computing Division of VMware, and also Head of Global Marketing now. Congratulations. New job role to oversee all of marketing, to bring that unified view across the company. Good to see you again, welcome back. >> Thank you John, and the John and John Show. I'm happy, I always love being on your show. >> Yeah, we have another John Walls on the other set over there, so it's three Johns hosting here in theCUBE. >> My middle name is John, let me tell you that, so I fit in the community. >> So Sanjay I want to get right into it. So you're giving us a preview here, folks, for tomorrow, the Keynote, you're the main act kicking off the Keynote tomorrow. A lot of big announcements, a couple super secret announcements that you can't share but you've got some new stuff going on in terms of new announcements, in terms of enhancements and new technologies. So can you share a little bit about tomorrow's announcements and what we'd expect at the Keynote. >> Yeah, thank you. So for everybody watching, make sure you dial in at nine o'clock tomorrow. I mean, the reality is, a key part of this client server to mobile cloud transformation is preparing people for a public cloud, digitally transforming the datacenters and preparing for public cloud, that's what you heard today. And the second piece of that, it's almost like two halves of the egg shell, the bottom part being the datacenter, the top part is preparing end users for an increasingly mobile world. And there we have this concept of a digital workspace, Workspace ONE that we introduced, and we're going to announced some new innovations there which really allow you to bring three things together. >> New products or new enhancements? >> In today's day and age when you're going cloud first, we're moving so fast so we don't do things in one big whole. I mean, for example, with AirWatch, we're doing probably like one incremental big feature every five, ten days. So we are doing things a lot more in the pace of cloud type company. So we don't really bundle everything to one big release. But nonetheless, we really focus our efforts around three gears, we're going to hear about tomorrow, one is the entire basis of how people work is driven now by identity management, and access to apps and identity. So you're going to see that tomorrow. And identity management becomes the important piece of the puzzle that's a control point for people's access to apps. Secondly you're going to hear about unified endpoint management and the worlds of desktop and mobile coming together. A good example of that is Windows 10. I'm going to talk about that more tomorrow. And third is a very important area of management and security, and how we think about endpoint management and endpoint security 'coz security is becoming one of the key missing linchpins that we think we can actually bring together in this digital workspace. So Workspace ONE with key focuses on areas like management and security. >> So you've been kind of, we've been interviewing you now three years. Congratulations, now at VMware, came from SAP as an executive there, now three years in. We've been watching your career, the end user computing evolve. The big bold movement down the field was the AirWatch acquisition. We've then seen a variety of different integration points in there. Give us an update on where it's come from and where, now we see where it's going, you just laid that out, but what are some of the specifics on how it's evolving because now with the cloud decision for the company, to say, okay, public cloud is in our equation with that Pat's announcement today, you've been kind of waiting for that engine, you've been kind of like, hurry up and wait for that to happen. So that's now, it's happening. Take us through how AirWatch in this piece evolved. >> Yeah, when we acquired AirWatch, part of it was our fundamental recognition that without a mobile strategy, you could end user computing. That's the name of our group is end user computing. You could end it 'coz we really needed something. So we looked at the space and we wanted something that was cloud first. They were, I would say, a close number, two or three, Mobile Line, I think was technical lead or maybe Good was, but they had a cloud architecture. We liked that about them. And was about a hundred million-dollar business. We disclosed at the end of last year that business was over 370 million in all in bookings. So you could see how rapidly we've taken them, they're almost 4X in two years. And the overall end user computing business was about a half billion when I joined. We announced at the end of last year, was a 1.2 billion all in bookings run rate company. When I joined it was about 30,000 customers. We're now about 65,000 customers. So reality is, we're now one of the top major businesses within the company. There's a lot of momentum. And that's been, I think, one of the better software acquisitions anybody's done the last two or three years. >> And strategically speaking, the digital transformation framework is essentially around this digital workspace area. >> It came out of that mobile space. And the part that we are now starting to see with clearer lenses in the course of the last six to 12 months is that identity management becomes an important piece to add to VDI mobile management. So we've added a third pillar of focus. And we feel like CIOs shouldn't have to buy VDI from one set of vendors, mobile device management, mobile management from a second, and then identity management from a third. These are coalescing into a digital workspace. So a big focus there. And allows us to also expand into new areas, for example, Iot, we can talk about it this time, and areas like endpoint security. >> It seems like, talking about identity management, that to you is right out of your security story. It seems like identity then has to become the fundamental pillar of security of end users in today's enterprise. How does your security story play into-- >> Yeah that's a very good point John. And I would say you're absolutely right. When we are increasingly selling our end user computing solutions, we're finding a key influencing buyer is the CISO. 40% of people have come to our mobile connect conferences are important to the CISO. Identity is a security topic too. So if you pull up for a second, the VMware security story now is very simple. It's in three parts. Number one, we can protect the datacenter. NSX now, one of the key propositions is micro-segmentation. That's a security seller. Number two, we can protect the endpoint with solutions like AirWatch and TrustPoint, we can get to TrustPoint this time. And number three, we can protect the middle, the user. So protect the datacenter, protect the endpoint, and protect the middle, the user. And all of those make us a very strong story appealing to the CISO. And then we take a bevy of partners with us that have even stronger brands and security. For example, one of our lead partners is Palo Alto. We're working very closely with them in NSX. We're working very closely with them in AirWatch. We're working very closely with them in identity. Another example of partners, F5. So we picked the group of partners that have very strong brands and security. And we found things that we do well. We partner with them in things that they do well. It's a really good story to both the CIO and the CISO. >> So much of the cloud story, as well as the end user story, is also about timing. We've been waiting on public cloud. Pundits talk about the death of private cloud but they don't say what year really. And so a lot of the end user story kind of we had to wait on, VDI, we had to wait on the devices. How do you as a leader of this company look at timing and when the market is ready for something? >> Well, I mean John, I think you have to really look at trends. And I had a fundamental premise coming in that the two Cs, and I'll talk about this more on tomorrow's Keynote, that we really needed to attack with venom was cost and complexity in the VDI market. And part of the reason as I talked to customers that many VDI projects failed, were cost and complexity. So we took a chainsaw to cost and complexity. And it turns out with a lot of what we've invented in the software-defined datacenter, software-defined storage that we were among the first to drive, hyper converged infrastructure, NSX for micro-segmentation, the fundamental premise of this sphere and all that you can do in areas like 3D graphics, we could engineer a solution that was 30 to 40% cheaper than the competition from VDI and app promoting. Complexity. We decided that VDI and app promoting needed to be one platform as opposed to sort of a competition that had like a, two separate products for VDI and app promoting. So these all were things that lowered the total cost of ownership and made that easy. Similarly with mobile, the two S's we attack there was simplicity and security. And we've had some core, I would say, these are the type of things, as a leader, you have to keep telling your teams, is your north pole. We're attacking cost and complexity. Another example of cost and complexity is moving stuff to the cloud. Three years ago we were the first to announce desktop as a service. What was one of the messages this morning, IBM, now embracing that desktop as a service in their cloud, working with us both in IBM cloud and IBM GTS. It's come a long way in three years. >> So I got to ask you about the aspect of unification. We're hearing that tomorrow you're announcing a huge shift in how customers buy and that it ultimately will change the equation on their cost side which is eliminating these point solutions out there. This unification endpoint, I don't know what you're calling it, can you share, give a little bit of leg, as Dave Vellante would say, on this morning tomorrow on this announcement, this consolidation or unification. How should we think about this? >> I mean, I think, and hopefully it's not a surprise 'coz we've been building up this momentum as opposed to one big mega announcement. Workspace ONE is really the coming together of three core areas. VDI and everything related to the way in which we manage desktops and apps, mobile management, and identity management. And in each of those spaces, if you don't look at us, there are point vendors doing each of those. And our differentiation is one, it's unified, second, it's a cloud first solution, many cases the folks have not yet moved to the cloud, and then we extend the capabilities of things like Workspace ONE, optimized for our datacenter where it needs to, into new areas like, for example, security. So we think as you lay this out and then build a partnership ecosystem, with not just security vendors but apps vendors, we're going to have a very large apps vendor on stage with me tomorrow, for the first time on stage, so I'm not going to tell you who it is, but come tomorrow you'll hear that. >> Microsoft, SAP, Salesforce? >> You've got some obvious candidates but it's one of those folks. >> It is one of those folks? >> How many big ones left, right? Some of them have been buying everybody. >> We've got some scoop this year on theCUBE. >> But that's an example of where VMware is taking the lead at embracing an apps ecosystem. >> So I got to ask you, you're a student of history and text, so back in the old days, back in the 90s, when dial-up in internet, Office Connections, Radioservers was a buzzword, you'd have to dial up into a facility, and you have to be authenticated. Pretty straightforward back in the day. But now the authentication, if you will, is coming from endpoints that are, like, anything. Uber could be inside the enterprise and app. So this notion of endpoints is interesting. It's also complicated. So there's not only a security surface area, there's also a cost area to deploy these solutions. Is that the kind of what Workspace ONE does? I mean am I getting it right? Am I thinking it right as an access method? >> I think you've got one piece of it right and I think you're exactly right. In the world of mobile, my fingerprint now becomes, police know that that's unique usually-- >> So does Apple. >> Right. And my retina scan becomes it. So you've got very sophisticated phones, it doesn't have to be complicated ones, that can give you either the fingerprint or the retina scan. You'd have to physically cut my thumb off and pluck my eye. I dare you to do both of those to replicate me. So you can move away from a very-- >> That's two-factor authentication right there. >> Yes, multi-factor, right? So you can move away from tokens becoming your only avenue of multi-factor authentication. You can do things smoothly. But it doesn't end there. Endpoints security has to be re-thought to really work at speed and at scale, so that's why we partnered with this hot security company, you're going to see them also on display tomorrow, Tanium. And with them we built a product called TrustPoint. And we use it internally at VMware. In fact one of the things you're going to see in the demos I do tomorrow, there's going to be lots of demos in 25 minutes, of day of the life of how VMware uses technology both in Workspace ONE and endpoint security. Tanium's one of the hottest products that we internally use and we combine some of our IP with theirs, and created a product called TrustPoint in a Google-like interface. I can search to find all endpoints in the enterprise, what potential apps are running on them, what potential malware's on them, quarantine it and maybe even take action on them with some of the technologies we have from AirWatch. So we've combined the best of Tanium and VMware's technology and this is going to be a real hot solution for areas like Windows 10. >> And what's the uptake you're taking on traction given where you're business is going? You've got some good performance now. What's your expectation on uptake on some of these, this Workspace ONE and the end space? >> If you look at our success so far, I told them, when I joined the company, the business was about a half a billion. We announced the end of last year, it's on a 1.2 billion run rate. So we've effectively more than doubled the business, doubled the customer count. And I think that on our path from 1.2 to two billion over multiple number of years, these solutions are going to become very critical to our growth. Horizon in the desktop portfolio, AirWatch in the mobile portfolio, identity management, and TrustPoint. And when I talk to our sales guys, I say, "Listen, there's enough there to feed "a lot of potential customers," and when I look at our customer count, 65,000 customers, we're still about 9, 10% penetrated inside the overall VMware base. If we can double, triple our customer base, there's no reason why this couldn't be a multi-billion dollar business. >> Alright, so for CXOs whether that's CIOs, chief data officers, chief revenue officers, any CXO, chief security officers, CISOs, all that stuff, for they're watching out there and tomorrow's Keynote, how would you summarize if you have to boil out your point of view and your theme for tomorrow, and some of the key takeaways? >> Four words, consumer-simple, enterprise-secure. There's an element of simplicity that gives you all the productivity that you need with Workspace ONE and your end user world. And then there's a message of security that the IT wants. The users benefit from simplicity, IT benefits from security. Users benefit from choice, IT benefits from control. And you'll hear that very, hopefully, fairly clearly tomorrow. >> Sanjay, final question, your team, VMware, you've amassed quite a team, the performance have been great, when you go back to the ranch inside Palo Alto headquarters and throughout the world, what's your marching orders to the team? What's the guiding principle that you put forth with respect to keeping the pace of innovation to match up the cadence of what's expected, not only by potentially your customers, but also your potential partners and competitors? >> First off, I'm a big believer in serve and leadership. So you have to lead by values that replicate, there's no success without successors, so I'm a hound for talent, I'm always looking for ways by which, just like the warriors, we create the best end user computing team bar none, and I think we've been very fortunate to create that team in every area. There's more talent that we should be hiring. I hear about them and we go recruit them. But once we've got a good team, we keep them focused on the mission. I mean obviously we have a revenue growth goal, and at the core of it, beyond just selling things, we want to make the customers successful. So we keep customer as our north pole. Customer satisfaction for VMware has been the highest of any IT vendor. When you look at many of these, Temkin research does a survey of customer satisfaction, we're among the top five, almost consistently the last few years. And then we make sure that in the products that we build, customer first, serve and leadership at the top, customer-focused, and we are building products, I mean we're an engineering-centric company so we want to build the best products that have a leap factor over the competition. >> So the warriors have a style of play-outs. You have Steph Curry who's just, lights up. But they're not afraid to shoot the three. They're good on transition, great speed. What is your differentiation as an organization? What's that x factor? What's the one thing you can point to? >> I mean, I think, listen, we were probably a little bit lethargic in end user computing. John was joking about this before we just had the show. We want to build great factors and we're a little bit edgy. I mean I've been called everything on Twitter from the Nostradamus of EUC to all kinds of, but we're aggressive, but I will tell you that if people watch me in Twitter, it's never, in the words of The Godfather, it's never personal. It's strictly business. So we have fun. We're a little edgy out there. We're in your face, we want to compete, we want to win every deal but it's never personal. I mean it's just like Steph Curry. You're going to compete hard on the court, but after the game, you go and have a drink with Kobe Bryant or Lebron James or whoever-have-you. >> Well final question, I didn't get this 'coz it's such a good product conversation and organization with your group, now you're heading up marketing, as the VMware, a very community-driven, very data-driven company, thoughts on marketing, you have it on social media, do you see social as being a part of marketing? Do you look at that? Do you look at certain ideas that you see that you put forth? >> First off I think Robin Matlock, our CMO has been doing an amazing job, so I told her this as I took over marketing and communications. Oliver Roll, our Chief Communications Officer is also doing great. Listen, I'm just going to throw more wood in the fire. Things are going good. Let's just get them from good to great. This show is one of the most cultistic shows on the planet because of the way in which she and her team have built this thing. It just gets better and better. But there's a few things I think you're going to see us do more. Customer-based marketing, having customers become our spokespeople. I dream of a day where every ad that we have is the biggest companies in the world or the smallest companies using our technology to either make their business more efficient or save lives. And then increasingly over time, we're going to be also doing vertical-based marketing in certain industries. And social media is a great way of getting that work across. >> We'll you've been on theCUBE as an SAP executive, now three years at VMware, certainly this is seven years you've been with CUBE and you guys do it right, so Robin and team and now you. Thanks for your support, appreciate everything. >> Thank you John and John. >> Sanjay Poonen, the General Manager, End Use Computing, and Global Head of Marketing for VMware here inside theCUBE. I'm John Furrier with John Troyer. You're watching theCUBE. (upbeat music)