(bright music) >> Narrator: From theCube studios in Palo Alto in Boston, connecting with thought leaders all around the world, this is theCube conversation. >> Welcome to theCube's coverage of PagerDuty Summit. I'm your host from the cube Natalie Ehrlich. Now we're joined by Sean Scott the Chief Product Officer of PagerDuty. Thank you very much for joining the program. >> Glad to be here, thank you for having me. >> Terrific, while you've been with PagerDuty for about six months, how is it going? >> Well and great. So I joined PagerDuty because I saw the entire world was shifting to digital first and PagerDuty is key infrastructure for many of the world's largest companies. In fact, over 60% of the Fortune 100 are customers. And more importantly, I see a much broader future our platform will play in digital operations for these companies going forward. I'm excited to be a part of that. >> Terrific. Well, you have really robust experience over 20 years in the value leading product, marketing and engineering teams. What prompted the move? I mean, you explained it but just really curious why you made that. >> So, yeah, I had a long career at Amazon where I was responsible for much of the shopping experience. I ran the homepage, product page, checkout a lot of the underlying tools and tech that supports that worldwide across all devices. And then more recently I built and launched the scout autonomous delivery robot from the ground up. So, but after 15 years and I was starting to look for a change and I started talking to Jen, our CEO and the more we talked the more excited I became about the platform and what it can be going forward for our customers. You know, the fact that we are already integrated with so many customers around the world and playing such a critical role as part of their infrastructure. And yet I think we're just getting started and we can help out companies and so many more use cases across our organizations and really eliminate a lot of time in a waste from their processes. >> Well, this is your first PagerDuty summit. Do tell us, what do you think is the vision for this year's program? >> Yeah, so we'll be launching a lot of new products that I'm excited to talk about and I'll be sharing some of the vision about what I've been thinking about and what I've been working on for my time that I've been here so far. And that starts with our vision, which is really how do we enable more flexibility across our platform. I mentioned our customers are using us for a lot of unique ways beyond DevOps. Things like IOT device management. You know, I heard one yesterday of, you know really doing building management. So the building was having a water leak and instantly it was hooked up to PagerDuty already beforehand. And so within 30 seconds they had alerted and within a minute and a half, they had the water shut off of the building. So way beyond the DevOps use case to even organ transplant delivery, if you can believe that our platform is being used on. So it's pretty exciting to think about all our product already does, but we want to continue to accelerate that. And so building much more flexibility into our product to really capture more of that value and more of the work that's happening across the organization, connect to everyone. >> That's really incredible. We'd love it if you could share perhaps some insight what you're planning to announce this week. >> Yeah, sure. So we have a few things that we're announcing. One is we announced last year by the biggest news last September was our acquisition of Rundeck. And so as part of that, we're announcing our first integration of PagerDuty in Rundeck in the form of Runbook action. So this is a, you can think of it as kind of quick kind of micro automations or short automations to give responders much more insights into what's actually happening with an incident. So maybe it's say running a MIM command or a script on a server, we can actually run that directly from the PagerDuty interface. So you don't have to SSH into a box, for example what does all just takes time and effort. And so when you're trying to remediate that issue of maybe a site being down or a service being down, it all happens right there. And even your frontline responders can now do those remediations as well and those automation actions, to again before they need to escalate to the next tier or bring in other devs to help troubleshoot. So that's pretty exciting. We're also announcing service graft which is a new way to model your services and show your services and really understand your dependency graph. So if you think about one of the biggest challenges often when you're trying to remediate issues is understanding, is that me, or is that one of my dependent services? And so now we actually have new visualizations to really show that our responders exactly what's happening and you can quickly see, is it you or is it maybe some dependency maybe multiple teams are having the same issue that because one of the core services that everybody leverages is down and you can quickly see that. So that's pretty exciting as well. We have change correlation and internet outliers. So change correlation, you know, most incidents occur because of changes that were made by us people. And so being able to spotlight things like here's a change that was recently made, or here's a change based on our machine learning algorithms that we detected that could be a culprit here. So providing a much richer insights to again reduce that meantime to resolution. So this whole team, our intelligence team that's our whole purpose in life is really just to reduce that meantime to resolution for our customers. Imagine waking up, you know, tomorrow and your meantime to resolution just magically goes down because of our software updates and that's how that team focuses on. And then the last one in this group is internet outliers which is all about telling you have an incident, is this rare or is this a frequent incident? And just giving you a little more insights into what you're seeing which will again help the responders. We have some other announcements coming up, but I'll save that for something. >> Terrific. Well, you know, I'd love it if you could share some insight on the competitive landscape and how PagerDuty is, how you see its product offering different from the others. >> Sure. So we go head to head with a lot of our competitors and we have the, you know, being in the fortunate position that we do have a few competitors coming after us and some big names as well. But you know, when we go head to head with these companies we generally win and we see we're constantly getting put in bake-offs with these other competitors. We have one customer, I was talking to a few weeks back and they paired us against the incumbent and out of the box, we saw 50% improvement in meantime to acknowledge. So this is how quickly we can pull the responder. And then in addition, I thought was more interesting as we saw a 50% improvement in the meantime to resolution over the incumbent. And so while we do have competitors coming at us I'm really happy with the way our product performs and our customers are too. So after these bake-offs, it's usually pretty clear who's staying and who's going. >> Yeah. So when you were helping develop this program this week what were some of the key areas that you really wanted to highlight? >> So one of the big areas is really talking about our vision and what is our go forward plan, because I think while we're really known for incident response, I think some of the exciting things you'll hear about at the summit are kind of where we're going in terms of four pillars to our vision. One is flexibility. Flexible workflows and enabling flexibility. So if you think about all the things that our product is doing beyond DevOps. So for example, you know we had a customer telling us about they had put PagerDuty in front of everything they're doing. So their whole building is IP enabled. And so they had a contractor drill through a watermain and it was instantly able to shut off the water. So they, you know, within 30 seconds they had the PagerDuty had notified the right responders of building maintenance and within a minute and a half the water was shut off and they made the comment that PagerDuty just paid for itself with this one incident. We see IOT device management. We see even organ transplant delivery using our product. And so we will continue to fuel that with our flexibility. Second pillar is connect to everyone. We see that we have a lot of people connected, but we just launched fairly recently a customer service offering. So now we can get customer service not only informed what's going on, but also connecting to the dev teams and the engineering teams and the service owners to really give them more insights into the blast radius and what they may be seeing. The next one is connect everything. So we have over 550 out of the box integrations. So that makes it seamless to connect to apps like Datadog. But then also we work where our customers work. So we can actually do work in Slack or MS Teams and take action right in those tools. And the last one is automated way to toil. So we want to automate what can be automated. And this goes back to the one deck acquisition that I mentioned and getting that more deeply integrated with the stack and with processes across an organization. And we're seeing that when our customer has really taken advantage of that platform they can really automate a way to toil and automate a lot of redundant work and work that is just busy work and that keeps people from doing their day jobs, so to speak. >> Yeah, well obviously we had a really unusual last year with the pandemic. How do you think that it changed a business for you? Did it inspire you to move in a new direction? What do you see next in the near future? >> For sure. So I saw that, I mean, it's probably the reason why I came to PagerDuty because I saw the transformation industries are making a digital first, right. And so there was a lot of teams a lot of companies struggled, but then a lot of companies also flourished you'd take, you know companies like Instacart and DoorDash and Zoom, you know had a terrific year. And so, you know, PagerDuty even with the pandemic and companies that were struggling, we still grew pretty rapidly last year. And that's, I think it's pretty exciting. And it really speaks to that migration to digital where digital is now becoming table stakes and just part of what you have to do as a business as opposed to it used to be a goal that we need to do more on digital platform. And now it's like, you have to, you know focus on a digital platform if you want to simply stay relevant today. And so I think that's really important for PagerDuty because that's where we really help companies thrive. >> Sean, that's really interesting. To close out this interview, do you have any last thoughts? >> No, I think that covers it. I think we're really excited to grow with our customers and we're seeing great traction in the market and look forward to a bright future in our platform. Really helping customers solve new problems that they might've not even considered us for yet. >> Terrific, well, thank you very much for your insights. Sean Scott the Chief Product Officer at PagerDuty. And that wraps up our coverage today for the PagerDuty Summit. I'm your host, Natalie Erlich for theCube. Thank you for watching. (bright music)

>> Announcer: Live from the Bill Graham Auditorium in San Francisco, it's theCUBE, covering Pure Storage Accelerate 2018. Brought to be you by Pure Storage. >> Welcome back to theCUBE, we are live at Pure Storage Accelerate 2018 in San Francisco. I'm Lisa Prince Martin with Dave The Who Vellante, and we're with David Hatfield, or Hat, the president of Purse Storage. Hat, welcome back to theCUBE. >> Thank you Lisa, great to be here. Thanks for being here. How fun is this? >> The orange is awesome. >> David: This is great. >> Super fun. >> Got to represent, we love the orange here. >> Always a good venue. >> Yeah. >> There's not enough orange. I'm not as blind yet. >> Well it's the Bill Graham, I mean it's a great venue. But not generally one for technology conferences. >> Not it's not. You guys are not conventional. >> So far so good. >> But then-- >> Thanks for keeping us out of Las Vegas for a change. >> Over my dead body I thin I've said once or twice before. >> Speaking of-- Love our customers in Vegas. Unconventional, you've said recently this is not your father's storage company. What do you mean by that? >> Well we just always want to do things a little bit less conventional. We want to be modern. We want to do things differently. We want to create an environment where it's community so our customers and our partners, prospective customers can get a feel for what we mean by doing things a little bit more modern. And so the whole orange thing is something that we all opt in for. But it's more about really helping transform customer's organizations think differently, think out of the box, and so we wanted to create a venue that forced people to think differently, and so the last three years, one was on Pier 48, we transformed that. Last year was in a big steelworkers, you know, 100 year old steel manufacturing, ship building yard which is now long since gone. But we thought the juxtaposition of that, big iron rust relative to what we're doing from a modern solid state perspective, was a good metaphor. And here it's about making music, and how can we together as an industry, develop new things and develop new songs and really help transform organizations. >> For those of you who don't know, spinning disk is known as spinning rust, right? Eventually, so very clever sort of marketing. >> The more data you put on it the slower it gets and it gets really old and we wanted to get rid of that. We wanted to have everything be online in the data center, so that was the point. >> So Hat, as you go around and talk to customers, they're going through a digital transformation, you hear all this stuff about machine intelligence, artificial intelligence, whatever you want to call it, what are the questions that you're getting? CEO's, they want to get digital right. IT professionals are wondering what's next for them. What kind of questions and conversations are you having? >> Yeah, I think it's interesting, I was just in one of the largest financial services companies in New York, and we met with the Chief Data Officer. The Chief Data Officer reports into the CEO. And he had right next to him the CIO. And so they have this development of a recognition that moving into a digital world and starting to harness the power of data requires a business context. It requires people that are trying to figure out how to extract value from the data, where does our data live? But that's created the different organization. It drives devops. I mean, if you're going to go through a digital transformation, you're going to try and get access to your data, you have to be a software development house. And that means you're going to use devops. And so what's happened from our point of view over the last 10 years is that those folks have gone to the public cloud because IT wasn't really meeting the needs of what devops needed and what the data scientists were looking for, and so what we wanted to create not only was a platform and a tool set that allowed them to bridge the gap, make things better today dramatically, but have a platform that gets you into the future, but also create a community and an ecosystem where people are aware of what's happening on the devop's side, and connect the dots between IT and the data scientists. And so we see this exploding as companies digitize, and somebody needs to be there to help kind of bridge the gap. >> So what's your point of view and advice to that IT ops person who maybe really good at provisioning LUNS, should they become more dev like? Maybe ops dev? >> Totally, I mean I think there's a huge opportunity to kind of advance your career. And a lot of what Charlie talked about and a lot of what we've been doing for nine years now, coming up on nine years, is trying to make our customers heroes. And if data is a strategic asset, so much so they're actually going to think about putting it on your balance sheet, and you're hiring Chief Data Officers, who knows more about the data than the storage and infrastructure team. They understand the limitations that we had to go through over the past. They've recognized they had to make trade offs between performance and cost. And in a shared accelerated storage platform where you have tons of IO and you can put all of your applications (mumbles) at the same time, you don't have to make those trade offs. But the people that really know that are the storage leads. And so what we want to do is give them a path for their career to become strategic in their organization. Storage should be self driving, infrastructure should be self driving. These are not things that in a boardroom people care about, gigabytes and petabytes and petaflops, and whatever metric. What they care about is how they can change their business and have a competitive advantage. How they can deliver better customer experiences, how they can put more money on the bottom line through better insights, etc. And we want to teach and work with and celebrate data heroes. You know, they're coming from the infrastructure side and connecting the dots. So the value of that data is obviously something that's new in terms of it being front and center. So who determines the value of that data? You would think it's the business line. And so there's got to be a relationship between that IT ops person and the business line. Which maybe here to for was somewhat adversarial. Business guys are calling, the clients are calling again. And the business guys are saying, oh IT, they're slow, they say no. So how are you seeing that relationship changing? >> It has to come together because, you know, it does come down to what are the insights that we can extract from our data? How much more data can we get online to be able to get those insights? And that's a combination of improving the infrastructure and making it easy and removing those trade offs that I talked about. But also being able to ask the right questions. And so a lot has to happen. You know, we have one of the leaders in devops speaking tomorrow to go through, here's what's happening on the software development and devops side. Here's what the data scientists are trying to get at. So our IT professionals understand the language, understand the problem set. But they have to come together. We have Dr. Kate Harding as well from MIT, who's brilliant and thinking about AI. Well, there's only .5% of all the data has actually been analyzed. You know, it's all in these piggy banks as Burt talked about onstage. And so we want to get rid of the piggy banks and actually create it and make it more accessible, and get more than .5% of the data to be usable. You know, bring as much of that online as possible, because it's going to provide richer insights. But up until this point storage has been a bottleneck to making that happen. It was either too costly or too complex, or it wasn't performing enough. And with what we've been able to bring through solid state natively into sort of this platform is an ability to have all of that without the trade offs. >> That number of half a percent, or less than half a percent of all data in the world is actually able to be analyzed, is really really small. I mean we talk about, often you'll here people say data's the lifeblood of an organization. Well, it's really a business catalyst. >> David: Oil. >> Right, but catalysts need to be applied to multiple reactions simultaneously. And that's what a company needs to be able to do to maximize the value. Because if you can't do that there's no value in that. >> Right. >> How are you guys helping to kind of maybe abstract storage? We hear a lot, we heard the word simplicity a lot today from Mercedes Formula One, for example. How are you partnering with customers to help them identify, where do we start narrowing down to find those needles in the haystack that are going to open up new business opportunities, new services for our business? >> Well I think, first of all, we recognize at Pure that we want to be the innovators. We want to be the folks that are, again, making things dramatically better today, but really future-proofing people for what applications and insights they want to get in the future. Charlie talked about the three-legged stool, right? There's innovations that's been happening in compute, there's innovations that have been happening over the years in networking, but storage hasn't really kept up. It literally was sort of the bottleneck that was holding people back from being able to feed the GPUs in the compute that's out there to be able to extract the insights. So we wanted to partner with the ecosystem, but we recognize an opportunity to remove the primary bottleneck, right? And if we can remove the bottleneck and we can partner with firms like NVIDIA and firms like Cisco, where you integrate the solution and make it self driving so customers don't have to worry about it. They don't have to make the trade offs in performance and cost on the backend, but it just is easy to stamp out, and so it was really great to hear Service Now and Keith walk through is story where he was able to get a 3x level improvement and something that was simple to scale as their business grew without having an impact on the customer. So we need to be part of an ecosystem. We need to partner well. We need to recognize that we're a key component of it because we think data's at the core, but we're only a component of it. The one analogy somebody shared with me when I first started at Pure was you can date your compute and networking partner but you actually get married to your storage partner. And we think that's true because data's at the core of every organization, but it's making it available and accessible and affordable so you can leverage the compute and networking stacks to make it happen. >> You've used the word platform, and I want to unpack that a little bit. Platform versus product, right? We hear platform a lot today. I think it's pretty clear that platforms beat products and that allows you to grow and penetrate the market further. It also has an implication in terms of the ecosystem and how you partner. So I wonder if you could talk about platform, what it means to you, the API economy, however you want to take that. >> Yeah, so, I mean a platform, first of all I think if you're starting a disruptive technology company, being hyper-focused on delivering something that's better and faster in every dimension, it had to be 10x in every dimension. So when we started, we said let's start with tier one block, mission critical data workloads with a product, you know our Flash Array product. It was the fastest growing product in storage I think of all time, and it still continues to be a great contributor, and it should be a multi-billion dollar business by itself. But what customers are looking for is that same consumer like or cloud like experience, all of the benefits of that simplicity and performance across their entire data set. And so as we think about providing value to customers, we want to make sure we capture as much of that 99.5% of the data and make it online and make it affordable, regardless of whether it's block, file, or object, or regardless if it's tier one, tier two, and tier three. We talk about this notion of a shared accelerated storage platform because we want to have all the applications hit it without any compromise. And in an architecture that we've provided today you can do that. So as we think about partnering, we want to go, in our strategy, we want to go get as much of the data as we possibly can and make it usable and affordable to bring online and then partner with an API first open approach. There's a ton of orchestration tools that are out there. There's great automation. We have a deep integration with ACI at Cisco. Whatever management and orchestration tools that our customer wants to use, we want to make those available. And so, as you look at our Flash Array, Flash Deck, AIRI, and Flash Blade technologies, all of them have an API open first approach. And so a lot of what we're talking about with our cloud integrations is how do we actually leverage orchestration, and how do we now allow and make it easy for customers to move data in and out of whatever clouds they may want to run from. You know, one of the key premises to the business was with this exploding data growth and whether it's 30, 40, 50 zettabytes of data over the next you know, five years, there's only two and a half or three zettabytes of internet connectivity in those same period of time. Which means that companies, and there's not enough data platform or data resources to actually handle all of it, so the temporal nature of the data, where it's created, what a data center looks like, is going to be highly distributed, and it's going to be multi cloud. And so we wanted to provide an architecture and a platform that removed the trade offs and the bottlenecks while also being open and allowing customers to take advantage of Red Shift and Red Hat and all the container technologies and platform as a service technologies that exist that are completely changing the way we can access the data. And so we're part of an ecosystem and it needs to be API and open first. >> So you had Service Now on stage today, and obviously a platform company. I mean any time they do M and A they bring that company into their platform, their applications that they build are all part of that platform. So should we think about Pure? If we think about Pure as a platform company, does that mean, I mean one of your major competitors is consolidating its portfolio. Should we think of you going forward as a platform company? In other words, you're not going to have a stovepipe set of products, or is that asking too much as you get to your next level of milestone. >> Well we think we're largely there in many respects. You know, if you look at any of the competitive technologies that are out there, you know, they have a different operating system and a different customer experience for their block products, their file products, and their object products, etc. So we wanted to have a shared system that had these similar attributes from a storage perspective and then provide a very consistent customer experience with our cloud-based Pure One platform. And so the combination of our systems, you hear Bill Cerreta talk about, you have to do different things for different protocols to be able to get the efficiencies in the data servers as people want. But ultimately you need to abstract that into a customer experience that's seamless. And so our Pure One cloud-based software allows for a consistent experience. The fact that you'll have a, one application that's leveraging block and one application that's leveraging unstructured tool sets, you want to be able to have that be in a shared accelerated storage platform. That's why Gartner's talking about that, right? Now you can do it with a solid state world. So it's super key to say, hey look, we want consistent customer experience, regardless of what data tier it used to be on or what protocol it is and we do that through our Pure One cloud-based platform. >> You guys have been pretty bullish for a long time now where competition is concerned. When we talk about AWS, you know Andy Jassy always talks about, they look forward, they're not looking at Oracle and things like that. What's that like at Pure? Are you guys really kind of, you've been also very bullish recently about NVME. Are you looking forward together with your partners and listening to the voice of the customer versus looking at what's blue over the corner? >> Yes, so first of all we have a lot of respect for companies that get big. One of my mentors told me one time that they got big because they did something well. And so we have a lot of respect for the ecosystem and companies that build a scale. And we actually want to be one of those and are already doing that. But I think it's also important to listen and be part of the community. And so we've always wanted to the pioneers. We always wanted to be the innovators. We always wanted to challenge conventions. And one of the reasons why we founded the company, why Cos and Hayes founded the company originally was because they saw that there was a bottleneck and it was a media level bottleneck. In order to remove that you need to provide a file system that was purpose built for the new media, whatever it was going to be. We chose solid state because it was a $40 billion industry thanks to our consumer products and devices. So it was a cost curve where I and D was going to happen by Samsung and Toshiba and Micron and all those guys that we could ride that curve down, allowing us to be able to get more and more of the data that's out there. And so we founded the company with the premise that you need to remove that bottleneck and you can drive innovation that was 10x better in every dimension. But we also recognize in doing so that putting an evergreen ownership model in place, you can fundamentally change the business model that customers were really frustrated by over the last 25 years. It was fair because disk has lots of moving parts, it gets slower with the more data you put on, etc., and so you pass those maintenance expenses and software onto customers. But in a solid state world you didn't need that. So what we wanted to do was actually, in addition to provide innovation that was 10x better, we wanted to provide a business model that was evergreen and cloud like in every dimension. Well, those two forces were very disruptive to the competitors. And so it's very, very hard to take a file system that's 25 years old and retrofit it to be able to really get the full value of what the stack can provide. So we focus on innovation. We focus on what the market's are doing, and we focus on our customer requirements and where we anticipate the use cases to be. And then we like to compete, too. We're a company of folks that love to win, but ultimately the real focus here is on enabling our customers to be successful, innovating forward. And so less about looking sidewise, who's blue and who's green, etc. >> But you said it before, when you were a startup, you had to be 10x better because those incumbents, even though it was an older operating system, people's processes were wired to that, so you had to give them an incentive to do that. But you have been first in a number of things. Flash itself, the sort of All-Flash, at a spinning disk price. Evergreen, you guys set the mark on that. NVME you're doing it again with no premium. I mean, everybody's going to follow. You can look back and say, look we were first, we led, we're the innovator. You're doing some things in cloud which are similar. Obviously you're doing this on purpose. But it's not just getting close to your customers. There's got to be a technology and architectural enabler for you guys. Is that? >> Well yeah, it's software, and at the end of the day if you write a file system that's purpose built for a new media, you think about the inefficiencies of that media and the benefits of that media, and so we knew it was going to be memory, we knew it was going to be silicon. It behaves differently. Reads are effectively free. Rights are expensive, right? And so that means you need to write something that's different, and so you know, it's NVME that we've been plumbing and working on for three years that provides 44,000 parallel access points. Massive parallelism, which enables these next generation of applications. So yeah we have been talking about that and inventing ways to be able to take full advantage of that. There's 3D XPoint and SCM and all kinds of really interesting technologies that are coming down the line that we want to be able to take advantage of and future proof for our customers, but in order to do that you have to have a software platform that allows for it. And that's where our competitive advantage really resides, is in the software. >> Well there are lots more software companies in Silicon Valley and outside Silicon Valley. And you guys, like I say, have achieved that escape velocity. And so that's pretty impressive, congratulations. >> Well thank you, we're just getting started, and we really appreciate all the work you guys do. So thanks for being here. >> Yeah, and we just a couple days ago with the Q1FY19, 40%, you have a year growth, you added 300 more customers. Now what, 4800 customers globally. So momentum. >> Thank you, thank you. Well we only do it if we're helping our customers one day at a time. You know, I'll tell you that this whole customer first philosophy, a lot of customers, a lot of companies talk about it, but it truly has to be integrated into the DNA of the business from the founders, and you know, Cos's whole pitch at the very beginning of this was we're going to change the media which is going to be able to transform the business model. But ultimately we want to make this as intuitive as an iPhone. You know, infrastructure should just work, and so we have this focus on delivering simplicity and delivering ownership that's future proofed from the very beginning. And you know that sort of permeates, and so you think about our growth, our growth has happened because our customers are buying more stuff from us, right? If you look at our underneath the covers on our growth, 70 plus percent of our growth every single quarter comes from customers buying more stuff, and so, as we think about how we partner and we think about how we innovate, you know, we're going to continue to build and innovate in new areas. We're going to keep partnering. You know, the data protection staff, we've got great partners like Veeam and Cohesity and Rubrik that are out there. And we're going to acquire. We do have a billion dollars of cash in the bank to be able to go do that. So we're going to listen to our customers on where they want us to do that, and that's going to guide us to the future. >> And expansion overseas. I mean, North America's 70% of your business? Is that right? >> Rough and tough. Yeah, we had 28%-- >> So it's some upside. >> Yeah, yeah, no any mature B2B systems company should line up to be 55, 45, 55 North America, 45, in line with GDP and in line with IT spend, so we made investments from the beginning knowing we wanted to be an independent company, knowing we wanted to support global 200 companies you have to have operations across multiple countries. And so globalization is always going to be key for us. We're going to continue our march on doing that. >> Delivering evergreen from an orange center. Thanks so much for joining Dave and I on the show this morning. >> Thanks Lisa, thanks Dave, nice to see you guys. >> We are theCUBE Live from Pure Accelerate 2018 from San Francisco. I'm Lisa Martin for Dave Vellante, stick around, we'll be right back with our next guests.

[Music] [Music] [Music] [Laughter] [Laughter] [Laughter] [Laughter] [Music] [Music] [Music] [Music] you you [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Applause] [Music] wake up feeling blessed peace you warned that Russia ain't afraid to show it I'll expose it if I dressed up riding in that Chester roasted nigga catch you slippin on myself rocks on I messed up like yes sir [Music] [Music] [Music] [Music] our program [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] you are not welcome to Red Hat summit 2018 2018 [Music] [Music] [Music] [Laughter] [Music] Wow that is truly the coolest introduction I've ever had thank you Wow I don't think I feel cool enough to follow an interaction like that Wow well welcome to the Red Hat summit this is our 14th annual event and I have to say looking out over this audience Wow it's great to see so many people here joining us this is by far our largest summit to date not only did we blow through the numbers we've had in the past we blew through our own expectations this year so I know we have a pretty packed house and I know people are still coming in so it's great to see so many people here it's great to see so many familiar faces when I had a chance to walk around earlier it's great to see so many new people here joining us for the first time I think the record attendance is an indication that more and more enterprises around the world are seeing the power of open source to help them with their challenges that they're facing due to the digital transformation that all of enterprises around the world are going through the theme for the summit this year is ideas worth exploring and we intentionally chose that because as much as we are all going through this digital disruption and the challenges associated with it one thing I think is becoming clear no one person and certainly no one company has the answers to these challenges right this isn't a problem where you can go buy a solution this is a set of capabilities that we all need to build it's a set of cultural changes that we all need to go through and that's going to require the best ideas coming from so many different places so we're not here saying we have the answers we're trying to convene the conversation right we want to serve as a catalyst bringing great minds together to share ideas so we all walk out of here at the end of the week a little wiser than when we first came here we do have an amazing agenda for you we have over 7,000 attendees we may be pushing 8,000 by the time we got through this morning we have 36 keynote speakers and we have a hundred and twenty-five breakout sessions and have to throw in one plug scheduling 325 breakout sessions is actually pretty difficult and so we used the Red Hat business optimizer which is an AI constraint solver that's new in the Red Hat decision manager to help us plan the summit because we have individuals who have a clustered set of interests and we want to make sure that when we schedule two breakout sessions we do it in a way that we don't have overlapping sessions that are really important to the same individual so we tried to use this tool and what we understand about people's interest in history of what they wanted to do to try to make sure that we spaced out different times for things of similar interests for similar people as well as for people who stood in the back of breakouts before and I know I've done that too we've also used it to try to optimize room size so hopefully we will do our best to make sure that we've appropriately sized the spaces for those as well so it's really a phenomenal tool and I know it's helped us a lot this year in addition to the 325 breakouts we have a lot of our customers on stage during the main sessions and so you'll see demos you'll hear from partners you'll hear stories from so many of our customers not on our point of view of how to use these technologies but their point of views of how they actually are using these technologies to solve their problems and you'll hear over and over again from those keynotes that it's not just about the technology it's about how people are changing how people are working to innovate to solve those problems and while we're on the subject of people I'd like to take a moment to recognize the Red Hat certified professional of the year this is known award we do every year I love this award because it truly recognizes an individual for outstanding innovation for outstanding ideas for truly standing out in how they're able to help their organization with Red Hat technologies Red Hat certifications help system administrators application developers IT architects to further their careers and help their organizations by being able to advance their skills and knowledge of Red Hat products and this year's winner really truly is a great example about how their curiosity is helped push the limits of what's possible with technology let's hear a little more about this year's winner when I was studying at the University I had computer science as one of my subjects and that's what created the passion from the very beginning they were quite a few institutions around my University who were offering Red Hat Enterprise Linux as a course and a certification paths through to become an administrator Red Hat Learning subscription has offered me a lot more than any other trainings that have done so far that gave me exposure to so many products under red hair technologies that I wasn't even aware of I started to think about the better ways of how these learnings can be put into the real life use cases and we started off with a discussion with my manager saying I have to try this product and I really want to see how it really fits in our environment and that product was Red Hat virtualization we went from deploying rave and then OpenStack and then the open shift environment we wanted to overcome some of the things that we saw as challenges to the speed and rapidity of release and code etc so it made perfect sense and we were able to do it in a really short space of time so you know we truly did use it as an Innovation Lab I think idea is everything ideas can change the way you see things an Innovation Lab was such an idea that popped into my mind one fine day and it has transformed the way we think as a team and it's given that playpen to pretty much everyone to go and test their things investigate evaluate do whatever they like in a non-critical non production environment I recruited Neha almost 10 years ago now I could see there was a spark a potential with it and you know she had a real Drive a real passion and you know here we are nearly ten years later I'm Neha Sandow I am a Red Hat certified engineer all right well everyone please walk into the states to the stage Neha [Music] [Applause] congratulations thank you [Applause] I think that - well welcome to the red has some of this is your first summit yes it is thanks so much well fantastic sure well it's great to have you here I hope you have a chance to engage and share some of your ideas and enjoy the week thank you thank you congratulations [Applause] neha mentioned that she first got interest in open source at university and it made me think red hats recently started our Red Hat Academy program that looks to programmatically infuse Red Hat technologies in universities around the world it's exploded in a way we had no idea it's grown just incredibly rapidly which i think shows the interest that there really is an open source and working in an open way at university so it's really a phenomenal program I'm also excited to announce that we're launching our newest open source story this year at Summit it's called the science of collective discovery and it looks at what happens when communities use open hardware to monitor the environment around them and really how they can make impactful change based on that technologies the rural premier that will be at 5:15 on Wednesday at McMaster Oni West and so please join us for a drink and we'll also have a number of the experts featured in that and you can have a conversation with them as well so with that let's officially start the show please welcome red hat president of products and technology Paul Cormier [Music] Wow morning you know I say it every year I'm gonna say it again I know I repeat myself it's just amazing we are so proud here to be here today too while you all week on how far we've come with opens with open source and with the products that we that we provide at Red Hat so so welcome and I hope the pride shows through so you know I told you Seven Summits ago on this stage that the future would be open and here we are just seven years later this is the 14th summit but just seven years later after that and much has happened and I think you'll see today and this week that that prediction that the world would be open was a pretty safe predict prediction but I want to take you just back a little bit to see how we started here and it's not just how Red Hat started here this is an open source in Linux based computing is now in an industry norm and I think that's what you'll you'll see in here this week you know we talked back then seven years ago when we put on our prediction about the UNIX error and how Hardware innovation with x86 was it was really the first step in a new era of open innovation you know companies like Sun Deck IBM and HP they really changed the world the computing industry with their UNIX models it was that was really the rise of computing but I think what we we really saw then was that single company innovation could only scale so far could really get so far with that these companies were very very innovative but they coupled hardware innovation with software innovation and as one company they could only solve so many problems and even which comp which even complicated things more they could only hire so many people in each of their companies Intel came on the scene back then as the new independent hardware player and you know that was really the beginning of the drive for horizontal computing power and computing this opened up a brand new vehicle for hardware innovation a new hardware ecosystem was built around this around this common hardware base shortly after that Stallman and leanness they had a vision of his of an open model that was created and they created Linux but it was built around Intel this was really the beginning of having a software based platform that could also drive innovation this kind of was the beginning of the changing of the world here that system-level innovation now having a hardware platform that was ubiquitous and a software platform that was open and ubiquitous it really changed this system level innovation and that continues to thrive today it was only possible because it was open this could not have happened in a closed environment it allowed the best ideas from anywhere from all over to come in in win only because it was the best idea that's what drove the rate of innovation at the pace you're seeing today and it which has never been seen before we at Red Hat we saw the need to bring this innovation to solve real-world problems in the enterprise and I think that's going to be the theme of the show today you're going to see us with our customers and partners talking about and showing you some of those real-world problems that we are sought solving with this open innovation we created rel back then for this for the enterprise it started it's it it wasn't successful because it's scaled it was secure and it was enterprise ready it once again changed the industry but this time through open innovation this gave the hardware ecosystem a software platform this open software platform gave the hardware ecosystem a software platform to build around it Unleashed them the hardware side to compete and thrive it enabled innovation from the OEMs new players building cheaper faster servers even new architectures from armed to power sprung up with this change we have seen an incredible amount of hardware innovation over the last 15 years that same innovation happened on the software side we saw powerful implementations of bare metal Linux distributions out in the market in fact at one point there were 300 there are over 300 distributions out in the market on the foundation of Linux powerful open-source equivalents were even developed in every area of Technology databases middleware messaging containers anything you could imagine innovation just exploded around the Linux platform in innovation it's at the core also drove virtualization both Linux and virtualization led to another area of innovation which you're hearing a lot about now public cloud innovation this innovation started to proceed at a rate that we had never seen before we had never experienced this in the past in this unprecedented speed of innovation and software was now possible because you didn't need a chip foundry in order to innovate you just needed great ideas in the open platform that was out there customers seeing this innovation in the public cloud sparked it sparked their desire to build their own linux based cloud platforms and customers are now are now bringing that cloud efficiency on-premise in their own data centers public clouds demonstrated so much efficiency the data centers and architects wanted to take advantage of it off premise on premise I'm sorry within their own we don't within their own controlled environments this really allowed companies to make the most of existing investments from data centers to hardware they also gained many new advantages from data sovereignty to new flexible agile approaches I want to bring Burr and his team up here to take a look at what building out an on-premise cloud can look like today Bure take it away I am super excited to be with all of you here at Red Hat summit I know we have some amazing things to show you throughout the week but before we dive into this demonstration I want you to take just a few seconds just a quick moment to think about that really important event your life that moment you turned on your first computer maybe it was a trs-80 listen Claire and Atari I even had an 83 b2 at one point but in my specific case I was sitting in a classroom in Hawaii and I could see all the way from Diamond Head to Pearl Harbor so just keep that in mind and I turn on an IBM PC with dual floppies I don't remember issuing my first commands writing my first level of code and I was totally hooked it was like a magical moment and I've been hooked on computers for the last 30 years so I want you to hold that image in your mind for just a moment just a second while we show you the computers we have here on stage let me turn this over to Jay fair and Dini here's our worldwide DevOps manager and he was going to show us his hardware what do you got Jay thank you BER good morning everyone and welcome to Red Hat summit we have so many cool things to show you this week I am so happy to be here and you know my favorite thing about red hat summit is our allowed to kind of share all of our stories much like bird just did we also love to you know talk about the hardware and the technology that we brought with us in fact it's become a bit of a competition so this year we said you know let's win this thing and we actually I think we might have won we brought a cloud with us so right now this is a private cloud for throughout the course of the week we're going to turn this into a very very interesting open hybrid cloud right before your eyes so everything you see here will be real and happening right on this thing right behind me here so thanks for our four incredible partners IBM Dell HP and super micro we've built a very vendor heterogeneous cloud here extra special thanks to IBM because they loaned us a power nine machine so now we actually have multiple architectures in this cloud so as you know one of the greatest benefits to running Red Hat technology is that we run on just about everything and you know I can't stress enough how powerful that is how cost-effective that is and it just makes my life easier to be honest so if you're interested the people that built this actual rack right here gonna be hanging out in the customer success zone this whole week it's on the second floor the lobby there and they'd be glad to show you exactly how they built this thing so let me show you what we actually have in this rack so contained in this rack we have 1056 physical chorus right here we have five and a half terabytes of RAM and just in case we threw 50 terabytes of storage in this thing so burr that's about two million times more powerful than that first machine you boot it up thanks to a PC we're actually capable of putting all the power needs and cooling right in this rack so there's your data center right there you know it occurred to me last night that I can actually pull the power cord on this thing and kick it up a notch we could have the world's first mobile portable hybrid cloud so I'm gonna go ahead and unplug no no no no no seriously it's not unplug the thing we got it working now well Berg gets a little nervous but next year we're rolling this thing around okay okay so to recap multiple vendors check multiple architectures check multiple public clouds plug right into this thing check and everything everywhere is running the same software from Red Hat so that is a giant check so burn Angus why don't we get the demos rolling awesome so we have totally we have some amazing hardware amazing computers on this stage but now we need to light it up and we have Angus Thomas who represents our OpenStack engineering team and he's going to show us what we can do with this awesome hardware Angus thank you Beth so this was an impressive rack of hardware to Joe has bought a pocket stage what I want to talk about today is putting it to work with OpenStack platform director we're going to turn it from a lot of potential into a flexible scalable private cloud we've been using director for a while now to take care of managing hardware and orchestrating the deployment of OpenStack what's new is that we're bringing the same capabilities for on-premise manager the deployment of OpenShift director deploying OpenShift in this way is the best of both worlds it's bare-metal performance but with an underlying infrastructure as a service that can take care of deploying in new instances and scaling out and a lot of the things that we expect from a cloud provider director is running on a virtual machine on Red Hat virtualization at the top of the rack and it's going to bring everything else under control what you can see on the screen right now is the director UI and as you see some of the hardware in the rack is already being managed at the top level we have information about the number of cores in the amount of RAM and the disks that each machine have if we dig in a bit there's information about MAC addresses and IPs and the management interface the BIOS kernel version dig a little deeper and there is information about the hard disks all of this is important because we want to be able to make sure that we put in workloads exactly where we want them Jay could you please power on the two new machines at the top of the rack sure all right thank you so when those two machines come up on the network director is going to see them see that they're new and not already under management and is it immediately going to go into the hardware inspection that populates this database and gets them ready for use so we also have profiles as you can see here profiles are the way that we match the hardware in a machine to the kind of workload that it's suited to this is how we make sure that machines that have all the discs run Seth and machines that have all the RAM when our application workouts for example there's two ways these can be set when you're dealing with a rack like this you could go in an individually tag each machine but director scales up to data centers so we have a rules matching engine which will automatically take the hardware profile of a new machine and make sure it gets tagged in exactly the right way so we can automatically discover new machines on the network and we can automatically match them to a profile that's how we streamline and scale up operations now I want to talk about deploying the software we have a set of validations we've learned over time about the Miss configurations in the underlying infrastructure which can cause the deployment of a multi node distributed application like OpenStack or OpenShift to fail if you have the wrong VLAN tags on a switch port or DHCP isn't running where it should be for example you can get into a situation which is really hard to debug a lot of our validations actually run before the deployment they look at what you're intending to deploy and they check in the environment is the way that it should be and they'll preempts problems and obviously preemption is a lot better than debugging something new that you probably have not seen before is director managing multiple deployments of different things side by side before we came out on stage we also deployed OpenStack on this rack just to keep me honest let me jump over to OpenStack very quickly a lot of our opens that customers will be familiar with this UI and the bare metal deployment of OpenStack on our rack is actually running a set of virtual machines which is running Gluster you're going to see that put to work later on during the summit Jay's gone to an awful lot effort to get this Hardware up on the stage so we're going to use it as many different ways as we can okay let's deploy OpenShift if I switch over to the deployed a deployment plan view there's a few steps first thing you need to do is make sure we have the hardware I already talked about how director manages hardware it's smart enough to make sure that it's not going to attempt to deploy into machines they're already in use it's only going to deploy on machines that have the right profile but I think with the rack that we have here we've got enough next thing is the deployment configuration this is where you get to customize exactly what's going to be deployed to make sure that it really matches your environment if they're external IPs for additional services you can set them here whatever it takes to make sure that the deployment is going to work for you as you can see on the screen we have a set of options around enable TLS for encryption network traffic if I dig a little deeper there are options around enabling ipv6 and network isolation so that different classes of traffic there are over different physical NICs okay then then we have roles now roles this is essentially about the software that's going to be put on each machine director comes with a set of roles for a lot of the software that RedHat supports and you can just use those or you can modify them a little bit if you need to add a monitoring agent or whatever it might be or you can create your own custom roles director has quite a rich syntax for custom role definition and custom Network topologies whatever it is you need in order to make it work in your environment so the rawls that we have right now are going to give us a working instance of openshift if I go ahead and click through the validations are all looking green so right now I can click the button start to the deploy and you will see things lighting up on the rack directors going to use IPMI to reboot the machines provisioned and with a trail image was the containers on them and start up the application stack okay so one last thing once the deployment is done you're going to want to keep director around director has a lot of capabilities around what we call de to operational management bringing in new Hardware scaling out deployments dealing with updates and critically doing upgrades as well so having said all of that it is time for me to switch over to an instance of openshift deployed by a director running on bare metal on our rack and I need to hand this over to our developer team so they can show what they can do it thank you that is so awesome Angus so what you've seen now is going from bare metal to the ultimate private cloud with OpenStack director make an open shift ready for our developers to build their next generation applications thank you so much guys that was totally awesome I love what you guys showed there now I have the honor now I have the honor of introducing a very special guest one of our earliest OpenShift customers who understands the necessity of the private cloud inside their organization and more importantly they're fundamentally redefining their industry please extend a warm welcome to deep mar Foster from Amadeus well good morning everyone a big thank you for having armadillos here and myself so as it was just set I'm at Mario's well first of all we are a large IT provider in the travel industry so serving essentially Airlines hotel chains this distributors like Expedia and others we indeed we started very early what was OpenShift like a bit more than three years ago and we jumped on it when when Retta teamed with Google to bring in kubernetes into this so let me quickly share a few figures about our Mario's to give you like a sense of what we are doing and the scale of our operations so some of our key KPIs one of our key metrics is what what we call passenger borders so that's the number of customers that physically board a plane over the year so through our systems it's roughly 1.6 billion people checking in taking the aircrafts on under the Amarillo systems close to 600 million travel agency bookings virtually all airlines are on the system and one figure I want to stress out a little bit is this one trillion availability requests per day that's when I read this figure my mind boggles a little bit so this means in continuous throughput more than 10 million hits per second so of course these are not traditional database transactions it's it's it's highly cached in memory and these applications are running over like more than 100,000 course so it's it's it's really big stuff so today I want to give some concrete feedback what we are doing so I have chosen two applications products of our Mario's that are currently running on production in different in different hosting environments as the theme here is of this talk hybrid cloud and so I want to give some some concrete feedback of how we architect the applications and of course it stays relatively high level so here I have taken one of our applications that is used in the hospitality environment so it's we have built this for a very large US hotel chain and it's currently in in full swing brought into production so like 30 percent of the globe or 5,000 plus hotels are on this platform not so here you can see that we use as the path of course on openshift on that's that's the most central piece of our hybrid cloud strategy on the database side we use Oracle and Couchbase Couchbase is used for the heavy duty fast access more key value store but also to replicate data across two data centers in this case it's running over to US based data centers east and west coast topology that are fit so run by Mario's that are fit with VMware on for the virtualization OpenStack on top of it and then open shift to host and welcome the applications on the right hand side you you see the kind of tools if you want to call them tools that we use these are the principal ones of course the real picture is much more complex but in essence we use terraform to map to the api's of the underlying infrastructure so they are obviously there are differences when you run on OpenStack or the Google compute engine or AWS Azure so some some tweaking is needed we use right at ansible a lot we also use puppet so you can see these are really the big the big pieces of of this sense installation and if we look to the to the topology again very high high level so these two locations basically map the data centers of our customers so they are in close proximity because the response time and the SLA is of this application is are very tight so that's an example of an application that is architectures mostly was high ability and high availability in minds not necessarily full global worldwide scaling but of course it could be scaled but here the idea is that we can swing from one data center to the unit to the other in matters of of minutes both take traffic data is fully synchronized across those data centers and while the switch back and forth is very fast the second example I have taken is what we call the shopping box this is when people go to kayak or Expedia and they're getting inspired where they want to travel to this is really the piece that shoots most of transit of the transactions into our Mario's so we architect here more for high scalability of course availability is also a key but here scaling and geographical spread is very important so in short it runs partially on-premise in our Amarillo Stata Center again on OpenStack and we we deploy it mostly in the first step on the Google compute engine and currently as we speak on Amazon on AWS and we work also together with Retta to qualify the whole show on Microsoft Azure here in this application it's it's the same building blocks there is a large swimming aspect to it so we bring Kafka into this working with records and another partner to bring Kafka on their open shift because at the end we want to use open shift to administrate the whole show so over time also databases and the topology here when you look to the physical deployment topology while it's very classical we use the the regions and the availability zone concept so this application is spread over three principal continental regions and so it's again it's a high-level view with different availability zones and in each of those availability zones we take a hit of several 10,000 transactions so that was it really in very short just to give you a glimpse on how we implement hybrid clouds I think that's the way forward it gives us a lot of freedom and it allows us to to discuss in a much more educated way with our customers that sometimes have already deals in place with one cloud provider or another so for us it's a lot of value to set two to leave them the choice basically what up that was a very quick overview of what we are doing we were together with records are based on open shift essentially here and more and more OpenStack coming into the picture hope you found this interesting thanks a lot and have a nice summer [Applause] thank you so much deeper great great solution we've worked with deep Marv and his team for a long for a long time great solution so I want to take us back a little bit I want to circle back I sort of ended talking a little bit about the public cloud so let's circle back there you know even so even though some applications need to run in various footprints on premise there's still great gains to be had that for running certain applications in the public cloud a public cloud will be as impactful to to the industry as as UNIX era was of computing was but by itself it'll have some of the same limitations and challenges that that model had today there's tremendous cloud innovation happening in the public cloud it's being driven by a handful of massive companies and much like the innovation that sundeck HP and others drove in a you in the UNIX era of community of computing many customers want to take advantage of the best innovation no matter where it comes from buddy but as they even eventually saw in the UNIX era they can't afford the best innovation at the cost of a siloed operating environment with the open community we are building a hybrid application platform that can give you access to the best innovation no matter which vendor or which cloud that it comes from letting public cloud providers innovate and services beyond what customers or anyone can one provider can do on their own such as large scale learning machine learning or artificial intelligence built on the data that's unique probably to that to that one cloud but consumed in a common way for the end customer across all applications in any environment on any footprint in in their overall IT infrastructure this is exactly what rel brought brought to our customers in the UNIX era of computing that consistency across any of those footprints obviously enterprises will have applications for all different uses some will live on premise some in the cloud hybrid cloud is the only practical way forward I think you've been hearing that from us for a long time it is the only practical way forward and it'll be as impactful as anything we've ever seen before I want to bring Byrne his team back to see a hybrid cloud deployment in action burr [Music] all right earlier you saw what we did with taking bare metal and lighting it up with OpenStack director and making it openshift ready for developers to build their next generation applications now we want to show you when those next turn and generation applications and what we've done is we take an open shift and spread it out and installed it across Asia and Amazon a true hybrid cloud so with me on stage today as Ted who's gonna walk us through an application and Brent Midwood who's our DevOps engineer who's gonna be making sure he's monitoring on the backside that we do make sure we do a good job so at this point Ted what have you got for us Thank You BER and good morning everybody this morning we are running on the stage in our private cloud an application that's providing its providing fraud detection detect serves for financial transactions and our customer base is rather large and we occasionally take extended bursts of traffic of heavy traffic load so in order to keep our latency down and keep our customers happy we've deployed extra service capacity in the public cloud so we have capacity with Microsoft Azure in Texas and with Amazon Web Services in Ohio so we use open chip container platform on all three locations because openshift makes it easy for us to deploy our containerized services wherever we want to put them but the question still remains how do we establish seamless communication across our entire enterprise and more importantly how do we balance the workload across these three locations in such a way that we efficiently use our resources and that we give our customers the best possible experience so this is where Red Hat amq interconnect comes in as you can see we've deployed a MQ interconnect alongside our fraud detection applications in all three locations and if I switch to the MQ console we'll see the topology of the app of the network that we've created here so the router inside the on stage here has made connections outbound to the public routers and AWS and Azure these connections are secured using mutual TLS authentication and encrypt and once these connections are established amq figures out the best way auda matically to route traffic to where it needs to get to so what we have right now is a distributed reliable broker list message bus that expands our entire enterprise now if you want to learn more about this make sure that you catch the a MQ breakout tomorrow at 11:45 with Jack Britton and David Ingham let's have a look at the message flow and we'll dive in and isolate the fraud detection API that we're interested in and what we see is that all the traffic is being handled in the private cloud that's what we expect because our latencies are low and they're acceptable but now if we take a little bit of a burst of increased traffic we're gonna see that an EQ is going to push a little a bi traffic out onto the out to the public cloud so as you're picking up some of the load now to keep the Layton sees down now when that subsides as your finishes up what it's doing and goes back offline now if we take a much bigger load increase you'll see two things first of all asher is going to take a bigger proportion than it did before and Amazon Web Services is going to get thrown into the fray as well now AWS is actually doing less work than I expected it to do I expected a little bit of bigger a slice there but this is a interesting illustration of what's going on for load balancing mq load balancing is sending requests to the services that have the lowest backlog and in order to keep the Layton sees as steady as possible so AWS is probably running slowly for some reason and that's causing a and Q to push less traffic its way now the other thing you're going to notice if you look carefully this graph fluctuate slightly and those fluctuations are caused by all the variances in the network we have the cloud on stage and we have clouds in in the various places across the country there's a lot of equipment locked layers of virtualization and networking in between and we're reacting in real-time to the reality on the digital street so BER what's the story with a to be less I noticed there's a problem right here right now we seem to have a little bit performance issue so guys I noticed that as well and a little bit ago I actually got an alert from red ahead of insights letting us know that there might be some potential optimizations we could make to our environment so let's take a look at insights so here's the Red Hat insights interface you can see our three OpenShift deployments so we have the set up here on stage in San Francisco we have our Azure deployment in Texas and we also have our AWS deployment in Ohio and insights is highlighting that that deployment in Ohio may have some issues that need some attention so Red Hat insights collects anonymized data from manage systems across our customer environment and that gives us visibility into things like vulnerabilities compliance configuration assessment and of course Red Hat subscription consumption all of this is presented in a SAS offering so it's really really easy to use it requires minimal infrastructure upfront and it provides an immediate return on investment what insights is showing us here is that we have some potential issues on the configuration side that may need some attention from this view I actually get a look at all the systems in our inventory including instances and containers and you can see here on the left that insights is highlighting one of those instances as needing some potential attention it might be a candidate for optimization this might be related to the issues that you were seeing just a minute ago insights uses machine learning and AI techniques to analyze all collected data so we combine collected data from not only the system's configuration but also with other systems from across the Red Hat customer base this allows us to compare ourselves to how we're doing across the entire set of industries including our own vertical in this case the financial services industry and we can compare ourselves to other customers we also get access to tailored recommendations that let us know what we can do to optimize our systems so in this particular case we're actually detecting an issue here where we are an outlier so our configuration has been compared to other configurations across the customer base and in this particular instance in this security group were misconfigured and so insights actually gives us the steps that we need to use to remediate the situation and the really neat thing here is that we actually get access to a custom ansible playbook so if we want to automate that type of a remediation we can use this inside of Red Hat ansible tower Red Hat satellite Red Hat cloud forms it's really really powerful the other thing here is that we can actually apply these recommendations right from within the Red Hat insights interface so with just a few clicks I can select all the recommendations that insights is making and using that built-in ansible automation I can apply those recommendations really really quickly across a variety of systems this type of intelligent automation is really cool it's really fast and powerful so really quickly here we're going to see the impact of those changes and so we can tell that we're doing a little better than we were a few minutes ago when compared across the customer base as well as within the financial industry and if we go back and look at the map we should see that our AWS employment in Ohio is in a much better state than it was just a few minutes ago so I'm wondering Ted if this had any effect and might be helping with some of the issues that you were seeing let's take a look looks like went green now let's see what it looks like over here yeah doesn't look like the configuration is taking effect quite yet maybe there's some delay awesome fantastic the man yeah so now we're load balancing across the three clouds very much fantastic well I have two minute Ted I truly love how we can route requests and dynamically load transactions across these three clouds a truly hybrid cloud native application you guys saw here on on stage for the first time and it's a fully portable application if you build your applications with openshift you can mover from cloud to cloud to cloud on stage private all the way out to the public said it's totally awesome we also have the application being fully managed by Red Hat insights I love having that intelligence watching over us and ensuring that we're doing everything correctly that is fundamentally awesome thank you so much for that well we actually have more to show you but you're going to wait a few minutes longer right now we'd like to welcome Paul back to the stage and we have a very special early Red Hat customer an Innovation Award winner from 2010 who's been going boldly forward with their open hybrid cloud strategy please give a warm welcome to Monty Finkelstein from Citigroup [Music] [Music] hi Marty hey Paul nice to see you thank you very much for coming so thank you for having me Oh our pleasure if you if you wanted to we sort of wanted to pick your brain a little bit about your experiences and sort of leading leading the charge in computing here so we're all talking about hybrid cloud how has the hybrid cloud strategy influenced where you are today in your computing environment so you know when we see the variable the various types of workload that we had an hour on from cloud we see the peaks we see the valleys we see the demand on the environment that we have we really determined that we have to have a much more elastic more scalable capability so we can burst and stretch our environments to multiple cloud providers these capabilities have now been proven at City and of course we consider what the data risk is as well as any regulatory requirement so how do you how do you tackle the complexity of multiple cloud environments so every cloud provider has its own unique set of capabilities they have they're own api's distributions value-added services we wanted to make sure that we could arbitrate between the different cloud providers maintain all source code and orchestration capabilities on Prem to drive those capabilities from within our platforms this requires controlling the entitlements in a cohesive fashion across our on Prem and Wolfram both for security services automation telemetry as one seamless unit can you talk a bit about how you decide when you to use your own on-premise infrastructure versus cloud resources sure so there are multiple dimensions that we take into account right so the first dimension we talk about the risk so low risk - high risk and and really that's about the data classification of the environment we're talking about so whether it's public or internal which would be considered low - ooh confidential PII restricted sensitive and so on and above which is really what would be considered a high-risk the second dimension would be would focus on demand volatility and responsiveness sensitivity so this would range from low response sensitivity and low variability of the type of workload that we have to the high response sensitivity and high variability of the workload the first combination that we focused on is the low risk and high variability and high sensitivity for response type workload of course any of the workloads we ensure that we're regulatory compliant as well as we achieve customer benefits with within this environment so how can we give developers greater control of their their infrastructure environments and still help operations maintain that consistency in compliance so the main driver is really to use the public cloud is scale speed and increased developer efficiencies as well as reducing cost as well as risk this would mean providing develop workspaces and multiple environments for our developers to quickly create products for our customers all this is done of course in a DevOps model while maintaining the source and artifacts registry on-prem this would allow our developers to test and select various middleware products another product but also ensure all the compliance activities in a centrally controlled repository so we really really appreciate you coming by and sharing that with us today Monte thank you so much for coming to the red echo thanks a lot thanks again tamati I mean you know there's these real world insight into how our products and technologies are really running the businesses today that's that's just the most exciting part so thank thanks thanks again mati no even it with as much progress as you've seen demonstrated here and you're going to continue to see all week long we're far from done so I want to just take us a little bit into the path forward and where we we go today we've talked about this a lot innovation today is driven by open source development I don't think there's any question about that certainly not in this room and even across the industry as a whole that's a long way that we've come from when we started our first summit 14 years ago with over a million open source projects out there this unit this innovation aggregates into various community platforms and it finally culminates in commercial open source based open source developed products these products run many of the mission-critical applications in business today you've heard just a couple of those today here on stage but it's everywhere it's running the world today but to make customers successful with that interact innovation to run their real-world business applications these open source products have to be able to leverage increase increasingly complex infrastructure footprints we must also ensure a common base for the developer and ultimately the application no matter which footprint they choose as you heard mati say the developers want choice here no matter which no matter which footprint they are ultimately going to run their those applications on they want that flexibility from the data center to possibly any public cloud out there in regardless of whether that application was built yesterday or has been running the business for the last 10 years and was built on 10-year old technology this is the flexibility that developers require today but what does different infrastructure we may require different pieces of the technical stack in that deployment one example of this that Effects of many things as KVM which provides the foundation for many of those use cases that require virtualization KVM offers a level of consistency from a technical perspective but rel extends that consistency to add a level of commercial and ecosystem consistency for the application across all those footprints this is very important in the enterprise but while rel and KVM formed the foundation other technologies are needed to really satisfy the functions on these different footprints traditional virtualization has requirements that are satisfied by projects like overt and products like Rev traditional traditional private cloud implementations has requirements that are satisfied on projects like OpenStack and products like Red Hat OpenStack platform and as applications begin to become more container based we are seeing many requirements driven driven natively into containers the same Linux in different forms provides this common base across these four footprints this level of compatible compatibility is critical to operators who must best utilize the infinite must better utilize secure and deploy the infrastructure that they have and they're responsible for developers on the other hand they care most about having a platform that can creates that consistency for their applications they care about their services and the services that they need to consume within those applications and they don't want limitations on where they run they want service but they want it anywhere not necessarily just from Amazon they want integration between applications no matter where they run they still want to run their Java EE now named Jakarta EE apps and bring those applications forward into containers and micro services they need able to orchestrate these frameworks and many more across all these different footprints in a consistent secure fashion this creates natural tension between development and operations frankly customers amplify this tension with organizational boundaries that are holdover from the UNIX era of computing it's really the job of our platforms to seamlessly remove these boundaries and it's the it's the goal of RedHat to seamlessly get you from the old world to the new world we're gonna show you a really cool demo demonstration now we're gonna show you how you can automate this transition first we're gonna take a Windows virtual machine from a traditional VMware deployment we're gonna convert it into a KVM based virtual machine running in a container all under the kubernetes umbrella this makes virtual machines more access more accessible to the developer this will accelerate the transformation of those virtual machines into cloud native container based form well we will work this prot we will worked as capability over the product line in the coming releases so we can strike the balance of enabling our developers to move in this direction we want to be able to do this while enabling mission-critical operations to still do their job so let's bring Byrne his team back up to show you this in action for one more thanks all right what Red Hat we recognized that large organizations large enterprises have a substantial investment and legacy virtualization technology and this is holding you back you have thousands of virtual machines that need to be modernized so what you're about to see next okay it's something very special with me here on stage we have James Lebowski he's gonna be walking us through he's represents our operations folks and he's gonna be walking us through a mass migration but also is Itamar Hine who's our lead developer of a very special application and he's gonna be modernizing container izing and optimizing our application all right so let's get started James thanks burr yeah so as you can see I have a typical VMware environment here I'm in the vSphere client I've got a number of virtual machines a handful of them that make up my one of my applications for my development environment in this case and what I want to do is migrate those over to a KVM based right at virtualization environment so what I'm gonna do is I'm gonna go to cloud forms our cloud management platform that's our first step and you know cloud forms actually already has discovered both my rev environment and my vSphere environment and understands the compute network and storage there so you'll notice one of the capabilities we built is this new capability called migrations and underneath here I could begin to there's two steps and the first thing I need to do is start to create my infrastructure mappings what this will allow me to do is map my compute networking storage between vSphere and Rev so cloud forms understands how those relate let's go ahead and create an infrastructure mapping I'll call that summit infrastructure mapping and then I'm gonna begin to map my two environments first the compute so the clusters here next the data stores so those virtual machines happen to live on datastore - in vSphere and I'll target them a datastore data to inside of my revenue Arman and finally my networks those live on network 100 so I'll map those from vSphere to rover so once my infrastructure is map the next step I need to do is actually begin to create a plan to migrate those virtual machines so I'll continue to the plan wizard here I'll select the infrastructure mapping I just created and I'll select migrate my development environment from those virtual machines to Rev and then I need to import a CSV file the CSV file is going to contain a list of all the virtual machines that I want to migrate that were there and that's it once I hit create what's going to happen cloud forms is going to begin in an automated fashion shutting down those virtual machines begin converting them taking care of all the minutia that you'd have to do manually it's gonna do that all automatically for me so I don't have to worry about all those manual interactions and no longer do I have to go manually shut them down but it's going to take care of that all for me you can see the migrations kicked off here this is the I've got the my VMs are migrating here and if I go back to the screen here you can see that we're gonna start seeing those shutdown okay awesome but as people want to know more information about this how would they dive deeper into this technology later this week yeah it's a great question so we have a workload portability session in the hybrid cloud on Wednesday if you want to see a presentation that deep dives into this topic and how some of the methodologies to migrate and then on Thursday we actually have a hands-on lab it's the IT optimization VM migration lab that you can check out and as you can see those are shutting down here yeah we see a powering off right now that's fantastic absolutely so if I go back now that's gonna take a while you got to convert all the disks and move them over but we'll notice is previously I had already run one migration of a single application that was a Windows virtual machine running and if I browse over to Red Hat virtualization I can see on the dashboard here I could browse to virtual machines I have migrated that Windows virtual machine and if I open up a tab I can now browse to my Windows virtual machine which is running our wingtip toy store application our sample application here and now my VM has been moved over from Rev to Vita from VMware to Rev and is available for Itamar all right great available to our developers all right Itamar what are you gonna do for us here well James it's great that you can save cost by moving from VMware to reddit virtualization but I want to containerize our application and with container native virtualization I can run my virtual machine on OpenShift like any other container using Huebert a kubernetes operator to run and manage virtual machines let's look at the open ship service catalog you can see we have a new virtualization section here we can import KVM or VMware virtual machines or if there are already loaded we can create new instances of them for the developer to work with just need to give named CPU memory we can do other virtualization parameters and create our virtual machines now let's see how this looks like in the openshift console the cool thing about KVM is virtual machines are just Linux processes so they can act and behave like other open shipped applications we build in more than a decade of virtualization experience with KVM reddit virtualization and OpenStack and can now benefit from kubernetes and open shift to manage and orchestrate our virtual machines since we know this virtual machine this container is actually a virtual machine we can do virtual machine stuff with it like shutdown reboot or open a remote desktop session to it but we can also see this is just a container like any other container in openshift and even though the web application is running inside a Windows virtual machine the developer can still use open shift mechanisms like services and routes let's browse our web application using the OpenShift service it's the same wingtip toys application but this time the virtual machine is running on open shift but we're not done we want to containerize our application since it's a Windows virtual machine we can open a remote desktop session to it we see we have here Visual Studio and an asp.net application let's start container izing by moving the Microsoft sequel server database from running inside the Windows virtual machine to running on Red Hat Enterprise Linux as an open shipped container we'll go back to the open shipped Service Catalog this time we'll go to the database section and just as easily we'll create a sequel server container just need to accept the EULA provide password and choose the Edition we want and create a database and again we can see the sequel server is just another container running on OpenShift now let's take let's find the connection details for our database to keep this simple we'll take the IP address of our database service go back to the web application to visual studio update the IP address in the connection string publish our application and go back to browse it through OpenShift fortunately for us the user experience team heard we're modernizing our application so they pitched in and pushed new icons to use with our containerized database to also modernize the look and feel it's still the same wingtip toys application it's running in a virtual machine on openshift but it's now using a containerized database to recap we saw that we can run virtual machines natively on openshift like any other container based application modernize and mesh them together we containerize the database but we can use the same approach to containerize any part of our application so some items here to deserve repeating one thing you saw is Red Hat Enterprise Linux burning sequel server in a container on open shift and you also saw Windows VM where the dotnet native application also running inside of open ships so tell us what's special about that that seems pretty crazy what you did there exactly burr if we take a look under the hood we can use the kubernetes commands to see the list of our containers in this case the sequel server and the virtual machine containers but since Q Bert is a kubernetes operator we can actually use kubernetes commands like cube Cpl to list our virtual machines and manage our virtual machines like any other entity in kubernetes I love that so there's your crew meta gem oh we can see the kind says virtual machine that is totally awesome now people here are gonna be very excited about what they just saw we're gonna get more information and when will this be coming well you know what can they do to dive in this will be available as part of reddit Cloud suite in tech preview later this year but we are looking for early adopters now so give us a call also come check our deep dive session introducing container native virtualization Thursday 2:00 p.m. awesome that is so incredible so we went from the old to the new from the close to the open the Red Hat way you're gonna be seeing more from our demonstration team that's coming Thursday at 8 a.m. do not be late if you like what you saw this today you're gonna see a lot more of that going forward so we got some really special things in store for you so at this point thank you so much in tomorrow thank you so much you guys are awesome yeah now we have one more special guest a very early adopter of Red Hat Enterprise Linux we've had over a 12-year partnership and relationship with this organization they've been a steadfast Linux and middleware customer for many many years now please extend a warm welcome to Raj China from the Royal Bank of Canada thank you thank you it's great to be here RBC is a large global full-service is back we have the largest bank in Canada top 10 global operate in 30 countries and run five key business segments personal commercial banking investor in Treasury services capital markets wealth management and insurance but honestly unless you're in the banking segment those five business segments that I just mentioned may not mean a lot to you but what you might appreciate is the fact that we've been around in business for over 150 years we started our digital transformation journey about four years ago and we are focused on new and innovative technologies that will help deliver the capabilities and lifestyle our clients are looking for we have a very simple vision and we often refer to it as the digitally enabled bank of the future but as you can appreciate transforming a hundred fifty year old Bank is not easy it certainly does not happen overnight to that end we had a clear unwavering vision a very strong innovation agenda and most importantly a focus towards a flawless execution today in banking business strategy and IT strategy are one in the same they are not two separate things we believe that in order to be the number one bank we have to have the number one tactic there is no question that most of today's innovations happens in the open source community RBC relies on RedHat as a key partner to help us consume these open source innovations in a manner that it meets our enterprise needs RBC was an early adopter of Linux we operate one of the largest footprints of rel in Canada same with tables we had tremendous success in driving cost out of infrastructure by partnering with rahat while at the same time delivering a world-class hosting service to your business over our 12 year partnership Red Hat has proven that they have mastered the art of working closely with the upstream open source community understanding the needs of an enterprise like us in delivering these open source innovations in a manner that we can consume and build upon we are working with red hat to help increase our agility and better leverage public and private cloud offerings we adopted virtualization ansible and containers and are excited about continuing our partnership with Red Hat in this journey throughout this journey we simply cannot replace everything we've had from the past we have to bring forward these investments of the past and improve upon them with new and emerging technologies it is about utilizing emerging technologies but at the same time focusing on the business outcome the business outcome for us is serving our clients and delivering the information that they are looking for whenever they need it and in whatever form factor they're looking for but technology improvements alone are simply not sufficient to do a digital transformation creating the right culture of change and adopting new methodologies is key we introduced agile and DevOps which has boosted the number of adult projects at RBC and increase the frequency at which we do new releases to our mobile app as a matter of fact these methodologies have enabled us to deliver apps over 20x faster than before the other point about around culture that I wanted to mention was we wanted to build an engineering culture an engineering culture is one which rewards curiosity trying new things investing in new technologies and being a leader not necessarily a follower Red Hat has been a critical partner in our journey to date as we adopt elements of open source culture in engineering culture what you seen today about red hearts focus on new technology innovations while never losing sight of helping you bring forward the investments you've already made in the past is something that makes Red Hat unique we are excited to see red arts investment in leadership in open source technologies to help bring the potential of these amazing things together thank you that's great the thing you know seeing going from the old world to the new with automation so you know the things you've seen demonstrated today they're they're they're more sophisticated than any one company could ever have done on their own certainly not by using a proprietary development model because of this it's really easy to see why open source has become the center of gravity for enterprise computing today with all the progress open-source has made we're constantly looking for new ways of accelerating that into our products so we can take that into the enterprise with customers like these that you've met what you've met today now we recently made in addition to the Red Hat family we brought in core OS to the Red Hat family and you know adding core OS has really been our latest move to accelerate that innovation into our products this will help the adoption of open shift container platform even deeper into the enterprise and as we did with the Linux core platform in 2002 this is just exactly what we did with with Linux back then today we're announcing some exciting new technology directions first we'll integrate the benefits of automated operations so for example you'll see dramatic improvements in the automated intelligence about the state of your clusters in OpenShift with the core OS additions also as part of open shift will include a new variant of rel called Red Hat core OS maintaining the consistency of rel farhat for the operation side of the house while allowing for a consumption of over-the-air updates from the kernel to kubernetes later today you'll hear how we are extending automated operations beyond customers and even out to partners all of this starting with the next release of open shift in July now all of this of course will continue in an upstream open source innovation model that includes continuing container linux for the community users today while also evolving the commercial products to bring that innovation out to the enterprise this this combination is really defining the platform of the future everything we've done for the last 16 years since we first brought rel to the commercial market because get has been to get us just to this point hybrid cloud computing is now being deployed multiple times in enterprises every single day all powered by the open source model and powered by the open source model we will continue to redefine the software industry forever no in 2002 with all of you we made Linux the choice for enterprise computing this changed the innovation model forever and I started the session today talking about our prediction of seven years ago on the future being open we've all seen so much happen in those in those seven years we at Red Hat have celebrated our 25th anniversary including 16 years of rel and the enterprise it's now 2018 open hybrid cloud is not only a reality but it is the driving model in enterprise computing today and this hybrid cloud world would not even be possible without Linux as a platform in the open source development model a build around it and while we have think we may have accomplished a lot in that time and we may think we have changed the world a lot we have but I'm telling you the best is yet to come now that Linux and open source software is firmly driving that innovation in the enterprise what we've accomplished today and up till now has just set the stage for us together to change the world once again and just as we did with rel more than 15 years ago with our partners we will make hybrid cloud the default in the enterprise and I will take that bet every single day have a great show and have fun watching the future of computing unfold right in front of your eyes see you later [Applause] [Music] [Music] [Music] [Music] [Music] [Music] [Music] [Music] anytime [Music]

>> Live from Las Vegas, it's theCUBE, covering Dell Technologies World 2018. Brought to you by Dell EMC and its Ecosystem partners. >> Welcome back to day three of Dell Technologies World, the inaugural Dell Technologies World. My name is Dave Vellante and you're watching theCUBE, the leader in live tech coverage. This is our kickoff of day three, we got a little analyst roundtable, Keith Townsend is with me, Stu Miniman, Peter Burris, the co-host, tri-hosts, quad-hosts of this show, long-time Dell EMC watchers and guys, let's unpack what's going on here. We're a couple years in now, the merger between Dell and EMC. I've said all along this was inevitable because of the pressures of cloud. It's very clear that Michael Dell is taking control of this company, it's the Dell brand, Dell Technologies, Dell Technologies World, EMC is sort of fading into the past, we'll talk about that Stu, we'll talk about the culture and the implications there, but I want to start with you Keith, let's talk about the customer perspective. What are you hearing from customers? What are the challenges that they're facing? Some of the concerns they may have with Dell and some of the positives? >> So one of the challenges, customers were worried that Dell EMC, Dell Technologies, would just be another HPE too big to solve their challenges, just how do you find solutions in the company with such a large portfolio? In reality, customers are pleasantly surprised that Dell Technologies has been able to surface up solutions, and not just focus on solutions, and also partner with their existing ecosystem of vendors, which is a surprise. One of the things I challenged Michael on as a customer, was hey you know what, this deal with Nutanix, this deal with XE, what are you leaning with from a hyperconverged solution perspective? Dell has been able to walk that line extremely well, We had a Datrium customer on day one, couldn't be happier with the relationship, then we talked to a couple of folks from the product team, 62% of the client meetings this week has been about VxRail, VxRack. Talked to another Fortune 500 customer that's all in on VxRail VxRack, not just for standard workloads, for SAP HANA which is not even certified for VxRail VxRack, so customers really happy with the overall ability of Dell to bring solutions to the table. I've seen, though we still have some time to tell if they'll be able to keep that momentum as they grow, as they continue to partner, and if they can continue to find solutions to challenges. >> Keith, if I can actually just follow up on one thing there, it's very clear that Dell will streamline the portfolio. Had Michael Dell, Jeff Clark, people from the marketing organization said absolutely, and we're telegraphing to customers as soon as we've sorted everything out we're gonna communicate it. Is there any concern from the customers? Michael said, we won't leave any customer behind, but absolutely the past of what EMC had with so many storage products they couldn't figure it out, there will be a lot less of them by the time we get to next year. >> So I think one of the things that you hit on when you talk about culture, I think customers still are very happy with the EMC brand, I think Dell did a really great job of not just getting rid of the EMC brand, customers still very much trust EMC. EMC had an extremely capable support organization, there's question about whether that support, that white glove support that we've gotten in the past from EMC will exist going forward. You know, Dell got rid of EMC cold, they brought Scale IO to a hardware-only solution versus the open ecosystem, so there's questions around where the cost-cutting will impact customer operations and support, but overall customers are happy with the progression. >> Peter Burris, one of the questions that Stu asked both Michael Dell and Clark yesterday is look you've got some of your bigger hardware competitors like IBM, like HP and HPE running away from head-to-head and I think Jeff Clark said "well I don't know how you can do end-to-end without both heads." So from your standpoint, from a customer perspective, is there an advantage to that head-to-head? We certainly heard it over the years, we used to hear it from HP a lot, we used to hear it from IBM a lot, they've retreated from that, Dell's sort of banging that end-to-end drum, does it matter from a customer perspective? >> Well of course, but it matters not just for what the customer wants but also the applications required. So, look, the biggest challenge, the most obvious, best end-to-end solution, if you take a very narrow view, it's gonna be AWS, Azure, some of these others. But the question is, is all of your data going to be in that public cloud? So the fundamental engineering challenge that every enterprise is gonna have is where am I gonna put my data? Some of the data is naturally gonna go to the public cloud, some of the data is not. What Dell needs to do over the course of the next couple of years is pick up on that as aggressively as they possibly can, try to not just convince people, but to show them that their organization of their digital business increasingly is going to be defined in terms of where their data assets are located, the practical realities of what that means, and therefore what types of fundamental support are they going to have to bring to bear on it? Keith, you said something interesting about HPE. The reason why Dell was not HPE, a little bit less so on IBM, is that Dell, Dell EMC have over the past 10, 15 years have made good bets, HP did not make good bets. You want to understand the history of HP over the last 10 years and why they're not the same, it's because HP gyrated all over the place to try to buy companies that were kind of at that moment a good price, let's just go for scale as best as we can, and Dell hasn't done that. Well Michael and his team have stayed relatively close to a simple vision of what types of engagement model they want, they've delivered on that vision, and they've got the assets that they can put into play now, but they just have to convince the enterprise that the play is where do you put your data, because you're gonna put your processing close to your data, and you're not gonna put it all in one place, right customer? And that's not going to be an easy, that's going to be a very challenging set of conversations over the next few years. We think how it's gonna play out is that Dell EMC is gonna be just fine because the enterprises are not gonna want to give all of their data up, and they can't give all their data up, so we'll see what happens. >> Well Stu let's talk about that, I mean Dell's cloud strategy is pretty clear, they want to be an arms dealer to the cloud. HPE, that's really their only choice, obviously IBM owns a cloud so it's a little different there, Oracle owns its own cloud, and they have software, that's a whole different ballgame. Dell clearly is comfortable being a high-volume, lower margin supplier, throwing off cashflow, throwing off profits. What's your take on the lack of a public cloud and are there issues there? >> Yeah, well you know Peter talked a little bit end-to-end and you see what Azure and AWS are doing. One of the surprising things for me is to see pieces of the public cloud and how the Dell Technologies portfolio are fitting into it. So being we're a native US, we absolutely understood. There's actually an isilon with Google cloud, a solution that I had an interesting discussion with Manuvir Das on day one here, really explained that you know scale out architecture, really get into the cloud. IBM cloud, there's a booth for them, they're here on the expo floor, so we've seen that maturation as hybrid cloud is not that transferring state that people thought but as that pits out we know data and applications are going to live lots of places and a company like Dell needs to be able to live in many of those environments. Edge of course, IOT, a hot issue that they're talking about, but they have portfolio products that will live in many of those places, so good maturation, public cloud is not enemy number one but of course they are a little bit more toward the private cloud, they highlight a bunch that if you go all in your prices are gonna be bad, we're gonna pull it back, Keith mentioned the EMC code team kind of got killed. A bunch of them are actually over at VMware now with an enhanced team, so it's still, we're not at the steady state of where the shift from my data center to public cloud is but it is definitely matured and nuanced and Dell has a lot of good partnerships that are growing. >> Well and selling servers to tier one cloud guys is not a great business, HP exited the business, Dell's in the business but it can't be a high market, it's not a great business I mean we know that. But, you know, nonetheless there's a lot of non-tier one clouds up there. You had a point to make, Pete? >> Yeah really quickly, the thing I was gonna say is, and we've talked about this in the past, and if we think about two things about Dell's portfolio, first off if we look back at what happened with the minicomputer business, and everybody says "oh the microprocessor killed it" well that probably contributed, but what really killed the minicomputer business was TCPIP and CISCO, that's what killed the minicomputer business because before a Dell or a Deck executive or a DG executive would walk into a shop with stuff all over the shop floor and the customer would say "I want to integrate this, you know, bridge it" and CISCO said, flatten the whole thing, bring TCPIP, and all those minicomputer companies went away. There is a gem in this portfolio which is NSX, and the degree to which Vmware, NSX can in fact become that technology for flattening the cloud network, cause that, to me, that's what the next big play in this industry is gonna be. AWS is gonna have its approach, Azure is gonna have its approach, you're gonna have bunch of on-premise stuff, the question is are you gonna be able to flatten those networks and really achieve that end-to-end? And if there's one good option on the table right now in the industry, it's VMware NSX for doing that. The second thing that I would say is, and I had a couple conversations with some folks about this this morning, we're talking about end-to-end, we're talking about greater conversions, hyperconversions, etc, yet Dell is still organized by server, storage, network, and it's going to be interesting to see how that evolves over the course of the next few years as customers increasingly do want a leverage that's end-to-end, diminish the distinctions and take advantage of convergence and whether or not we see Dell have a series of inter-nexian warfares about where that ends up. Because we know Dell does not wanna be RCA, right? >> Well that's really interesting because some of near-term moves that they've made are basically to take some of that converged stuff and put it in- >> That's right. So I love that now the TCPIP and NSX completely agree with you, the one thing that Dell is definitely missing from a customer perspective is the control plane glue they want to lead with the VMware story, you know any workload any cloud, I'm not gonna take my VMware approach to Google, I'm not gonna take that to Azure. So this any workload, any cloud thing, I'm not buying. I don't think customers are buying that. HPE is leading I think with a pretty good message on offering cloud services. It's a really, really difficult problem. >> The Oncenter story, you're talking about. >> The Onecenter story. It's a very difficult problem, enterprise customers want a single solution to consume all files, they want that TCPIP set of protocols, standards- >> They want the cloud to be flat. >> They want the cloud to be flat. NSX flattens it from a networking perspective but from a controlled plane API perspective the industry is a long way before that and I don't think Dell even has any plans for it. >> So, Stu, you know well when people were talking about you know, Michael's gonna sell VMware, you were very vocal about it, "no he's not, only an idiot would think that, I mean there's no way that's gonna happen." I mean, what a gem, in the portfolio, talk about end-to-end. The other thing I wanted to bring up is if you look at Dell's business, about half is the client business, it's doing better than expected so it's throwing off more cash than expected, especially with the storage business being soft, Dell's been pretty transparent about that, well I guess it has to be, but nonetheless there's upside there, but VMware is about 10% of the revenues, it throws off half of the operating cash, so why would you get rid of that, right? It's such a strategic asset 500,000 customers, a key part of the end-to-end, and it just makes this such a more interesting business. >> Yeah I mean Dave, I know you love teasing apart this complex, the tracking stock, all the things there, one of the interesting nuggets out of the Michael Dell interview was oh he said "the tax changes really had no impact, you know that's not it." You know, people really misunderstand, they understand these finances, it's not that they're hurting for cash, they can't make cash positions. >> So with my senses it's probably a slight negative but with the tax legislation, you're right, it's basically a net neutral for these guys. It's way overblown. >> Yeah, but you know, what's changed, we knew, when Dell went private, there were a bunch of changes in-company, I knew a lot of people that left the company for different things. The EMC acquisition, it's been a lot of change in the last 18 to 24 months, it'll still be rolling out there, you know, I live right in the heart of the old EMC country and there's some changes there, who's running it, you see a lot of former Dell executives, legacy Dell executives, there's still some strong people from the EMC side but Jeff Clark, very strong engineering culture, actually the more I've gotten to know him the more he reminds me of what EMC was 10 or 15 years ago in a good way, sharp, technical, getting on it. So I think the EMC brand, by the time we come here next year will be gone, but it doesn't mean the EMC people or products like the powermac are gonna be going anywhere. >> Well let me push at that a little bit, cause one of the things that Jeff Clark is doing is he's simplifying the portfolio, and Joe did the opposite, he complexified the portfolio because he said overlaps are better than gaps. And Jeff Clark's taking a different approach, is there a concern for customers? Wow, I might be left behind. They've got to be a little bit careful with that message, don't they? >> Yeah, but I mean we've touched on it a little bit, Dave, there's still some of the core product, you know powermac comes out there, this is the legacy of b macs, still supports the mainframe, you know, there's a business for this, and they're not gonna leave their customers behind. But what we said, Dave, when they put this portfolio together they need to turn the crank a little bit to get the operating margins where they need to be, not be overlapping so much with marketing and some of these other places. So, they're going to be very smart in how they do this, they say they're going to overcommunicate to not only their customers but their partner. I've talked to a bunch of (inaudible) partners, pretty happy. You know, there were a little bit of bumps over the last 18 to 24 months as to "oh wait I had this account rep and now they brought in this overlay and then they flopped who owned it." So it's been interesting to watch some of those and- >> Well look. >> It's a people business, and some of that changed- >> At the end of the day, Dell's portfolio can all be placed in service to the customer with relevance and competency today. That's a much better problem to have than a company that has either been building a bunch of stuff that's not gonna matter or has bought a bunch of stuff that's not gonna matter. It means if they can sustain a degree of focus that allows them to pay down their debt and do the financial engineering and Tom Sweet's a stud, the CFO's a stud, it means that they can listen to customers and continue to service what the customer needs because their portfolio is easily applied to customer problems unlike a lot of other companies. That's a pretty decent position. They can pursue all of these things because the portfolio is relevant. Now, are there gonna be some challenges? Well, one of the reasons why EMC complexified the portfolio was because they had salespeople who were deeply engaged in their accounts and they used that as an advantage, and so the salespeople said "I need something" and so Dell EMC, like CISCO did for years, went off, or EMC, went off and found it. Dell still has a different channel organization and a different channel approach, much more partnership-oriented, if there's tension in the model, I don't know what you think about this, Keith If there's tension in the model it's we're going through a major transformation in the industry right now. How close do you have to be to the customer, is this going to be a partner-led transformation or are you gonna want your people handling the transformation? EMC's approach was your people led the complex portfolio. Dell's approach, simplify the portfolio, are you making the relationships more complex as a result? >> That's a great point, we touched on this with Marius, because essentially, in Marius' organization you have an overlay EMC salesforce which is used to belly-to-belly, and he said "look we're working it out" and it requires great leadership. >> It's gotta be somewhere, is it gonna be in the portfolio or the engagement model? >> And from the engagement model, just look at the Dell Technologies family themselves. When I was a EMC VMware customer, I didn't have combined meetings with EMC and VMware, two belly-to-belly relationships. When that Dell EMC merger took place, Dell came in and flexed the muscle, you know desktops, laptops, end-to-end vision, VMware became, you know, you could sense the tension in the room. I just talked to another big Dell EMC VMware customer and they'll say you know what at VMworld, Dell Technologies World, the messaging here has been incredible. You get in the real world, you talk to your Dell Technologies or Dell EMC rep, one set of products, you talk to the VMware rep, a completely different set of products. >> And then you talk to partners, and what are they saying? So where's the complexity gonna be? EMC said the complexity's gonna be in the portfolio, the engagement model is gonna be simple. Dell's saying the portfolio is gonna be more simple, but what's gonna happen to the engagement model? Because customers, this transformation stuff we're talking about is hard. >> Let's break down, we've got a couple minutes left, let's break down the competitive landscape, the horses in the track as we like to say. We obviously got AWS, you know the megatrend factor sucking up a lot of demand. Everybody says that people are coming back on prem, more people are going to the cloud. 49% growth. So that's clear, but you got traditional server competitors which really is I guess HPE and Lenovo, right? We're gonna focus on the enterprise stuff because that's kind of our wheelhouse. You've got the storage guys, you know that app seems to be back, Pure is continuing to do its thing, small in the grand scheme of 80 billion dollars. >> Their best friend will be Nutanix. >> Right, yeah right, and you got that funky relationship, you got an interesting CISCO relationship going on, so how do you describe the competitive landscape? Start with you, Stu. >> Yeah, it's a little bit complicated. Listen to what Peter was saying there, EMC was pretty cut and dry, you know. Storage, that's where we're gonna live, and everything else, we're gonna partner, even all the server companies that need to sell storage, they have great partnerships with IBM and HP and everything like that with the first one you had to partner with EMC because they were dominant in that space. Dell at the core of it, server company still so it was interesting, one of the interviews I did, it was, you know, VxRail, if you're not in hyperconverted space, if you don't own the server, you're not in the right thing. And I'm like, we got Datrium and Nutanix and all these other partners that are here in the ecosystem that are living on top of the Dell platform, so there's a little bit of that give and take, it's more coopatition than I used to see, you used to go to Dell World, they'd have that rack of OEMs with all those different vessels out there, so you know, where does Dell want to go? How do they maximize, you know, the investment that they made in the biggest merger in tech history? So it's still playing out, I hear relatively good things from the partners, and the customers at least aren't getting stuck in the middle. You know, with CISCO sometimes it was really a punch in the face and if we're not 100% on board we're not gonna let you have it and then the channel would just sort it out themselves. >> I mean AWS and the cloud, it is what it is. The VMware partnership, you know good move, gives them some near-term maybe even mid-term runway, we'll see what happens long-term. In the server business it's HBE, right? Is the main competitor. What do you guys think? >> We got IBM. >> Yeah, IBM for sure, yeah. >> The powermacs that just got announced, when that comes out the second half of this year, that goes right after CISCO UCS. Not a lot of talk about CISCO, the VxBlock business is a three to four billion dollar business between the Dell family and the CISCO family and this is gonna put them at loggerheads really soon. >> Yeah I talked to customers, they love the Dell EMC certainly, powermacs has been one of the top conversations, they can't wait to connect their powermacs to their HPE blades, that's gonna be awesome. Which is good. The other piece of that is the NetApp story. NetApp did a great job of talking about data fabric and being a data copy, I don't know if they're there yet, did a great job talking about it. Dell EMC- >> Good investments, they hired great people, so they're on that path. >> Two men in my peer community, a man and woman said NetApp's cloud story is legit, they're good. >> They're a software company. >> They're a software company. Dell EMC's cloud story, specifically around storage, you know, the isilon announcement was a partnership but you know I think customers are really looking at that again, that API is about the data and how do I move my data on-prem, off-prem, I don't know if Dell EMC has their story yet and they have the product portfolio to back it. >> So, here's what I'd say Dave. At the end of the day, there's a whole bunch of transformations and I'll try to be as succinct as I can. First off, data has to be acknowledged as an asset. Number one. That's a transition in itself. Number two. Investment in technology has to be regarded as an investment in improving the value of that data asset which means that ultimately the money in this industry is gonna follow the value of the data, that's the simplest most straightforward way of thinking about this. So, when we think about, for example, the server business, we're saying "you're not gonna put all your data up in a public cloud because the data's not gonna allow you to do that." Well, what's the difference between saying you're not going to put all your data in a public cloud and saying oh you're going to move all of your data to some server somewhere? There's, yeah it's a little bit more approximate, but it's still not, you're gonna move your data closer to more intelligent storage, more intelligent networks, and they'll go find the compute that they need. And that's not how Dell is set up today. That's just not how they're set up today. So if we think about five to ten years, we're talking about a whole bunch of processing power being moved closer and closer and closer to the data in the form of, you know, routines that are being run right there at the storage machine. We're talking about much more programmable control planes, data-driven data-first control planes, that are being in the network and defined by what the network can do, and the compute is increasingly gonna be regarded as important, not unimportant, but it's gonna be an increasingly distributed world where you can't have your cake and eat it too, you can't say don't go up to the public cloud but go up to our big honking server. There's something that doesn't quite watch there. >> Well, great analysis Peter, and to your point organizational structures really matter and I think today Dell's organization is really optimized for the continued integration, streamlining that piece, getting that right, making sure the processes are there, and then we'll see how it goes over time. Alright, thanks you guys. That was awesome. Good kickoff for day three. Okay, this is day three, you're watching theCUBE, keep it right there we'll be back with our next guest right after this short break.

>> Announcer: Live, from downtown San Francisco, it's theCUBE covering IBM Chief Data Officer Strategy Summit 2018, brought to you by IBM. >> We're back at the IBM CDO Strategy Summit in San Francisco, we're at the Parc 55, you're watching theCUBE, the leader in live tech coverage. My name is Dave Vellante, and I'm here with Krishna Venkatraman, who is with IBM, he's the Vice President of Data Science and Data Governance. Krishna, thanks for coming on. >> Thank you, thank you for this opportunity. >> Oh, you're very welcome. So, let's start with your role. Your passion is really creating value from data, that's something you told me off-camera. That's a good passion to have these days. So what's your role at IBM? >> So I work for Inderpal, who's GCDO. He's the CDO for the company, and I joined IBM about a year ago, and what I was intrigued by when I talked to him early on was, you know, IBM has so many assets, it's got a huge history and legacy of technology, enormous, copious amounts of data, but most importantly, it also has a lot of experience helping customers solve problems at enterprise scale. And in my career, I started at HP Labs many, many years ago, I've been in a few startups, most recently before I joined IBM, I was at On Deck. What I've always found is that it's very hard to extract information and insights from data unless you have the end-to-end pieces in place, and when I was at On Deck, we built all of it from scratch, and I thought this would be a great opportunity to come to IBM, leverage all that great history and legacy and skill to build something that would allow data to almost be taken for granted. So, in a sense, a company doesn't have to think about the pain of getting value extracted from data, they could just say, you know, I trust data just as I trust the other things in life, like when I go buy a book, I know all the backend stuff is done for me, I can trust the product I get. And I was interested in that, and that's the role that Inderpal offered to me. >> So the opposite of On Deck, really. On Deck was kind of a blank sheet of paper, right? And so now you have a complex organization, as Inderpal was describing this morning, so big challenge. Ginni Rometty at IBM Think talked about incumbent disruptors, so that's essentially what IBM is, right? >> Exactly, exactly. The fact is IBM has a history and a culture of making their customers successful, so they understand business problems really well. They have a huge legacy in innovation around technology, and I think now is the right time to put all of those pieces together, right? To string together a lifecycle for how data can work for you, so when you embark on a data project, it doesn't have to take six months, it could be done in two or three days, because you've cobbled together how to manage data at the backend, you've got the data science and the data science lifecycle worked out, and you know how to deploy it into a business process, because you understand the business process really well. And I think, you know, those are the mismatches that I've seen happen over and over again, data isn't ready for the application of machine learning, the machine learning model really isn't well-suited to the eventual environment in which it's deployed, but I think IBM has all of that expertise, and I feel like it's an opportunity for us to tie that together. >> And everybody's trying to get, I often say, get digital right, you know, your customers, your clients, everyone talks about digital transformation, but it's really all about the data, isn't it? Getting the data right. >> Getting the data right, that's where it starts. Tomorrow, I'm doing a panel on trust, you know, we can talk about the CDO and all the great things that are happening and extracting value, but unless you have trust at the beginning and you're doing good data governance, and you're able to understand your data, all of the rest will never happen. >> But you have to have both, alright? Because if you have trust without the data value, then okay. And you do see a lot of organizations just focusing, maybe over-rotating on that privacy and trust and security, for good reason, how do you balance that information as an asset versus liability equation? Because you're trying to get value out of it, and at the same time, you're trying to protect your organization. >> Yeah. I think it's a virtuous cycle, I think they build on each other. If customers trust you with their data, they're going to give you more of it, because they know you're going to use it responsibly, and I think that's a very positive thing, so I actually look at privacy and trust as enablers to create value, rather than somehow they're in competition. >> Not a zero-sum game. >> Not at all. >> Let's talk some more about that, I mean, when you think about it, because I've heard this before, GDPR comes up. Hey, we can turn GDPR into an opportunity, it's not just this onerous, even though it is, regulatory imposition, so maybe some examples or maybe talk through how organizations can take the privacy and trust part of the equation and turn it into value. >> So very simply, what does GDPR promise, right? It's restoring the fundamental rights of data subjects, in terms of their ownership of their data and the processing of their data and the ability to know how that data is used at any point in time. Now imagine if you're a data scientist and you could, for a problem that you're trying to solve, have the same kind of guarantees. You know all about the data, you know where it resides, you know exactly what it contains. They're very similar, you know? They both are asking for the same type of information. So, in a sense, if you solve the GDPR problem well, you have to really understand your data assets very well, and you have to have it governed really well, which is exactly the same need for data scientists. So, in a way, I seem them as, you know, they're twins, separated at some point, but... >> What's interesting, too, is you think about, we were sort of talking about this off-camera, but now, you're one step away from going to a user or customer and saying here, here's your data, do what you like with it. Now okay, in the one case, GDPR, you control it, sort of. But the other is if you want to monetize your own data, why pay the search company for clicking on an ad? Why not monetize your own data based on your reputation or do you see a day where consumers will actually be able to own, truly own their own data? >> I think, as a consumer, as well as a data professional, I think that the technologies are falling into place for that model to possibly become real. So if you have something that's very valuable that other people want, there should be a way for you to get some remuneration for that, right? And maybe it's something like a blockchain. You contribute your data and then when that data is used, you get some little piece of it as your reward for that. I don't know, I think it's possible, I haven't really... >> Nirvana. I wonder if we can talk about disruption, nobody talks about that, we haven't had a ton of conversations here about disruption, it seems to be more applying disciplines to create data value, but coming from the financial services industry, there's an industry that really hasn't been highly disrupted, you know, On Deck, in a way, was trying to disrupt. Healthcare is another one that hasn't been disrupted. Aerospace really hasn't been disrupted. Other industries like publishing, music, taxis, hotels have been disrupted. The premise is, it's the data that enables that disruption. Thoughts on disruption from the standpoint of your clients and how you're helping them become incumbent disruptors? >> I think sometimes disruption happens and then you look back and you say, that was disrupted after all, and you don't notice it when it happens, so even if I look at financial services and I look at small business lending, the expectations of businesses have changed on how they would access capital in that case. Even though the early providers of that service may not be the ones who win in the end, that's a different matter, so I think the idea that, you know, and I feel like this confluence of technologies, where's there's blockchain or quantum computing or even regulation that's coming in, that's sort of forcing certain types of activities around cleaning up data, they're all happening simultaneously. I think we will see certain industries and certain processes transform dramatically. >> Orange Bank was an example that came up this morning, an all-digital bank, you can't call them, right? You can't walk into their branch. You think banks will lose control of the payment systems? They've always done a pretty good job of hanging onto them, but... >> I don't know. I think, ultimately, customers are going to go to institutions they trust, so it's all going to end up with, do you trust the entity you've given your precious commodities to, right? Your data, your information, I think companies that really take that seriously and not take it as a burden are the ones who are going to find that customers are going to reach out to them. So it's more about not necessarily whether banks are going to lose control or whether... Which banks are going to win, is the way I would look at it. >> Maybe the existing banks might get trouble, but there's so many different interesting disruption scenarios, I mean, you think about Watson in healthcare, maybe we're at the point already where machines can make better diagnoses than doctors. You think about retail, and certain retail won't go away, obviously grocery and maybe high-end luxury malls won't go away, but you wonder about the future of retail as a result of this data disruption. Your thoughts? >> On retail? I do feel like, because the data is getting more, people are going to have more access to their own information, it will lead to a change in business models in certain cases. And the friction or the forces that used to keep customers with certain businesses may dissolve, so if you don't have friction, then it's going to end up with value and loyalty and service, and those are the ones I think that will thrive. >> Client comes to you, says, Krishna, I'm really struggling with my overall data strategy, my data platform, governance, skills, all the things that Inderpal talked about this morning, where do I start? >> I would start with making sure that the client has really thought about the questions they need answered. What is it that you really want to answer with data, or it doesn't even have to be with data, for the business, with its strategy, with its tactics, there have to be a set of questions framed up that are truly important to that business. And then starting from there, you can say, you know, let's slow it down and see what technologies, what types of data will help support answering those questions. So there has to be an overarching value proposition that you're trying to solve for. And I see, you know, that's why when, the way we work in our organization is, we look at use cases as a way to drive the technology adoption. What are the big business processes you are trying to transform, what's the value you expect to create, so we have a very robust discovery process where we ask people to answer those types of questions, we help them with it. We ask them to think through what they would do if they had the perfect answer, how they will implement it, how they will measure it. And then we start working on the technology. I often think technology is an easier question to answer once you know what you want to ask. >> Totally. Is that how you spend your time, mostly working with the lines of business, trying to help them sort of answer those questions? >> That is one part of my charter. So my charter involves basically four areas, the first is data governance, just making sure that we are creating all the tools and processes so that we can guarantee that when data is used, it is trusted, it is certified, and that it's always going to be reliable. The second piece is building up a real data competency and data science competency in the organization, so we know how to use data for different types of business value, and then the third is actually taking these client engagements internally and making sure that they are successful. So our model is what we call co-creation. We ask business teams to contribute their own resources. Data engineers, data scientists, business experts. We contribute specialized skills as well. And so we're jointly in the game together, right? So that's the third piece. And the last piece is, we're building out this platform that Inderpal showed this morning, that platform needs product management, so we are also working on, what are the fundamental pieces of functionality we want in the platform, and how do we make sure they're on the roadmap and they're prioritized in the right way. >> Excellent. Well, Krishna, thanks very much for coming to theCUBE, it was a pleasure meeting you. >> Thanks. >> Alright, keep it right there everybody, we'll be back with our next guest. You're watching theCUBE live from IBM CDO Summit in San Francisco. We'll be right back. (funky electronic music) (phone dialing)

(electronic dance music) >> Host: Live from San Francisco. It's theCUBE. Covering Oracle OpenWorld 2016. Brought to you by Oracle. Now, here's your hosts, John Furrier and Peter Burris. >> Hey, welcome back everyone. We are here live in San Francisco for Oracle OpenWorld 2016. This is theCUBE. SiliconANGLE Media's flaghship program. We got out to the events and extract the signal from the noise. I'm John Furrier the co-CEO of SiliconANGLE Media with Peter Burris, my co-host, who's the head of research for SiliconANGLE Media as well as the general manager of Wikibon Research. Our next guest is Dave Donatelli, Executive Vice President of Cloud and Converged Systems and Infrastructure at Oracle. Cube alumni always coming on. Great to see you. Thanks for spending really valuable time to come and share your insights with us. >> Great to see you guys again. It's always a pleasure. >> So you did the keynote today, obviously the forces in the industry around Cloud, Oracle's got the whole story now. They got the IaaS V2, they're calling it. And now you have up and down the stack PasS and Saas, and under the covers, under the hood is the power hardware. >> Dave: Of the infrastructure, yeah. >> Very disruptive and we chatted and we wrote a story at SiliconANGLE, also on Forbes, about the destruction of the existing incumbents. So with that in mind, how did the keynote go from your perspective? What was your key themes and how does that relate to some of the disruption in the landscape of the industry? >> Okay, well, as a self-writer, I'd say the keynote went very well, but what I really talked about was Oracle offers people three deployment models. And I gave 'em kind of five journey to take to the Cloud. The three models are public Cloud, broad-based public Cloud. Second thing is traditional enterprise, which business we've been in for so long. And then a new category is what we call Cloud a customer. Taking our public Cloud and making that available to customers. And then the second thing I did in the keynote is talk about five journeys people could take to our public Cloud and it's everything from optimizing what they currently have in their legacy environment, to running hybrid Cloud, to running this Cloud a customer, to running private Cloud, and the fifth one is just, end what you're doing in the current way and move all public Cloud. So in the five journeys, just to drill down on that. It's five different paths the customer could take. >> Dave: Correct, all from a customer's perspective. >> From their current position to a Cloud endgame, if you will. >> Dave: Yes. >> And which one you think is the most dominant right now in terms of your view because obviously we'll go though those, but of the ones, beyond on-prem, which ones has the most relevance today in terms of customers that you hear from. Why I'd say two things, what I see and what I've seen the last year is the acceleration of movement to the public Cloud in literally since the start of the year has been massive. And what's really changed about a lot of it's coming top down. So you see CEOs, board of directors, CFOs saying we're going to go to the Cloud, even some companies are giving their IT departments specific requirements. You'll have 40% of our applications in the Cloud by 2000. So big acceleration there and in saying that what most customers are doing is something in the middle. They have their legacy that they've always been running. we look at it app by app by app. What's the most likely to transform to the Cloud? Which ones are probably just going to go away? Which one should we just redesigned and build net new in the Cloud. And so that means to me that hybrid is really, you know, the one that we see most often. People are running on-premise, they're running in the Cloud. They'll have a mix for some time until the on-premise continues to go away. >> What's the concept we heard from Chuck Hollis yesterday around this notion of Cloud quotas. He's seeing customers being kind of mandated to get to the Cloud, almost like a quota. Hey, where are you with your with your Cloud migration? So there's pressure certainly coming in but you introduced Cloud insurance. Is that not actually insurance, but as a concept, just explain what you meant by that. >> Sure. So what we mean by that is this, is that, as I, as we just talked about most enterprises, if you look at most of data out there says only 5% of applications have moved to the Cloud, so far. So that means a lot are still running in their data centers. But now you're going to go to your boss and you're going to say, "Hey you know I need to buy some new infrastructure.". And if you're a regular company, that's going to take three to five years to depreciate. So you go to your boss and say, "Hey, give me $10 million, I got this great idea. I'm going to put this new infrastructure in.". Well, what if two years from now your boss comes in and says, "Guess what? We now we need to move to the public Cloud.". With traditional infrastructure or with infrastructure designed by companies who don't have a public Cloud, you now have a boat anchor, right? I run big businesses myself and the last thing you want is equipment on your books depreciating that has no technical value. What we mean by Cloud insurance, is that everything we sell customers on-premise also has a public Cloud equivalency. Think of Exadata. You can use Exadata on-premise. We have an Exadata Cloud service you can subscribe to in the Cloud. So if you buy an Exadata on-premise today and they say we want to start moving to Cloud. You can say, "Great, I'll do things like test EV in the Cloud with my equivalent Exadata service.". They're fully compatible. It's got the same management. It's one push button to move data from on-premise to the public Cloud. No one else can do that. >> Peter: So you're really selling them a Cloud option. Whatever you buy you are also buying a Cloud option. >> What I say is I'm giving them assurance and insurance. The assurance is you're buying something today that you know will have a useful life going forward in the go forward architecture. >> Peter: And if you want to exercise hat option today, you can do so, if you want exercising three years you can do so. >> Exactly. >> No financial penalty to you. >> Exactly. And what most competitors are saying is hey, by the way you always did it and guess what? You don't have that option. >> Peter: It's your asset. So one of the things, I love the idea of the five paths, but paths are going to be influenced by workloads. So as you think about the characteristics of workloads, not big companies, small company, regional, those are always going to be important. Sophistication, maturity of the shop. But, as you think about workloads, going back to John's question, what types of workloads do you see coming in first? So for example, we're seeing a lot of on-premise, big data happening, but not as fast as it might because of complexity. We're starting to see more of that move into options that are more simply packaged, easier to use like in the Cloud. What kind of workloads do you think are going to pull customers forward first? >> Dave: Sure. Well, first remember we play in Saas, PasS, and infrastructure. And what we've seen if you look at our financials, is huge growth in SaaS and that's where people are saying, I am taking, you know, with GE here, as an example, Ge is taking their ERP, big global company, they're putting that in the public Cloud. HSBC was here, same story, big financial institution. They're putting that in the Cloud first. And the reason why they're doing it, is they think it gives you more flexibility, makes them more efficient, saves them money. Then, which really changed, and what we've evolved to, is with our new infrastructure Cloud now we can do anything. This is to your question. Anything that runs on an x86 server or spark based server, whether it's an Oracle application or not, you can either migrate it and run it in our Cloud. You can, you know, reimagine it using using our PaaS to redesign it, move it to the Cloud, it's everything. And we're seeing increasing rates of people walking through by app by app in their environment and doing just what we've said. What stays, what moves, what do we transform in the process? >> You seen a lot of the the movie at EMC, certainly your history, your career at EMC and then HP. Lot of industry had changed while you're, you know, in those shops, now here at Oracle. So I got to ask you now with the Oracle advantage and you guys are pushing from the silicon to the app, however, I forget how they word it, but it's silicon to the app, the end-to-end kind of thing. What's different from a design standpoint, from a technical, as the product development teams build it, what's the unique thing that's changed? And how's that render itself to impacting the customer? >> Dave: Okay, that's a great question. So let me give you the customer benefit first and I'll tell you why it occurs. what I said today from stage is that to run our, I'll use an examples of our software. To run our software there's no better place on earth than our infrastructure, and compared to their most likely alternative which is their self build, them buying an x86 server, them buying their own networking, them buying storage. We give people better performance, better end-user experience, easier to manage and most importantly it costs them less money. >> John: So knocking down Oracle on Oracle, boom. That's a baseline. >> Less cost versus you going to buy a server online at Dell and trying to put it together yourself. >> I buy that. >> Dave: The way we do it, is the fact that we have insights which we have designed, all the way into our software as well as into our products. So depending which product you're talking about, for instance in Spark, we embedded a silicon itself. Accelerators for things like encryption, for deencryption, for the ability to compress, to decompress. All kinds of things that matter and speed. At the same time we make a lot of changes to our software itself to make that run better with our Hardware. It's RIP. It takes a lot of engineering to do that, but simply put if you don't have the software stack, you know if you're someone who just builds hardware, you can't see the software, you can't make those changes. >> John: Well, you have the advantage. Obviously, you have have software that Oracle writes, you have systems that are engineered for Oracle software. Clear advantage, so you're saying unequivocally-- >> Dave: From a technical-- >> You blow everyone away. >> Dave: From a pure technical perspective, it is an unfair fight. We will win every time. >> John: Okay, so i buy that, so that, you win those rounds. Curveball is multi-vendor. Now we're into a multi-vendor because a lot of people have that technical debt now on the books, if you will, I don't know if that's the right term, technical debt, but they have legacy. It might be Dell EMC, it might be HP and other stuff. How do how do those shops deal with this Oracle infrastructure Cloud and non Oracle software. >> Okay, so two ways. So if you look at an on-premise, we make products that run both Oracle software, engineered systems to run both Oracle software, non Oracle software in the same machine. So you get all the accrued benefits we talked about but you can also host your applications that might not necessarily be Oracle, with us. In the Cloud itself, i think you heard, you know I thought Larry gave an excellent presentation yesterday and very clearly walking through what we do that's different than alternatives. And as we said, >> John: He was very aggressive on Amazon. >> Dave: But I thought he was very, I thought he was very fair in how you did it, right. He walked through it just the facts. This is what they do, this is what we do, this is why it's technically different. He didn't just come out and say hey, we're better than amazon he gave specific reasons why. >> John: He did that and he did that, he did both. >> But if you look at it, so even just running a generic app, that's non-Oracle, on our infrastructure as a service, what we said very clearly is, we have an infrastructure by the way it is architected, that has less noise, meaning so you get less performance disruption, so it runs faster. It's built with the newer hardware and at the same time in doing so because of our architecture we can offer that to people at a lower price than they'd otherwise get. And again I think those are very straightforward, very well articulated points to show the value and you know that opens up the whole world to us. As you know the x86 market is almost a $40 billion market on-premise. What we're saying now at Oracle is, we can do a better job for you in the public Cloud running any of those workloads. >> That's right now. I think the other thing that came out, we've talked about it here, is that the stream of innovation that's going to unload itself on the industry over the next few years, someone still has to do the integration of all of these different piece parts. They're going to be improved upon and that integration cost is real, and so you can look at that from a CIOs perspective, they can look at and say do I want to put my time into the integration, do I want to put my time into the application that's going to have a differential effect on my business. So you guys seem to be coming pretty strongly on we've got the baseline we need to do the, we've got the stuff that we need to bring the innovation in an integrated way into our packaging. >> Dave: That's correct and I think very well said. I believe we are the easiest company to work with, in bringing people from, in essence, their old architecture to the new. And that is because we've already done that integration work. We offer those architectures on both sides of the equation, current on-premise into the public Cloud and give you one management software structure to manage both. Anybody else is only going to work with you on one extreme or another. It's either, hey only do Cloud or only do on-prem. How you work with the other one, you as a customer stuck with that burden to figure out. Dave, I know you got to go to another meeting, but I want to get the final question to you to elaborate on. What you're most proud of now in your tenure at Oracle. Some things that have worked for you in the organization product-wise, successes you've had. You want to highlight a few? And what's your priorities going forward? You're now running the Cloud group as well as Converged Infrastructure kind of coming together. What are you most proud of? what is, could be people not things, like ZDLRA, I know is doing really, Juan Loaiza was saying it's a smashing success and we're not hearing anything about that. We heard about it yesterday, but so what are you most proud of and then what's your priorities going forward? >> What I'm most proud of about being at Oracle is we're an organization investing for our customers' future. So we're spending $5.2 billion this year on R and D and it's all about bringing out these products that fit the future for our customers and protecting their investments along the way. I'm very proud to be part of a company, because as you know in these big transitions, companies don't make it. Think of Deck, right? They're a leader, didn't make it through to the new transition. And we're one of these companies that's leading the new transition even though we also participated in the prior architecture. I think from a product perspective, I would say ZDLRA is a great one you brought up. It stands for Zero Data Loss Recovery Appliance. It is designed by our database engineers to fully backup and recover, as it says, with zero data loss, our database. And we've had a number of customers here, we had customers of the keynote today, very major enterprises at the keynote today was General Electric, who talked about how it enables them now to sleep. They don't get woken up at three in the morning. It gives some certainty in terms of how they recover. And most importantly, it saves them money. >> And you're in the hardware business, but you're not in the box business. You're actually have the software, it's again software enabled. Congratulations, I know you're attracting a lot of good talent as well. They did a great job and it's been fun to watch your success at Oracle and we're proud to cover you guys. We have some points we would disagree with you. If we had more time we can go into little detail, but thanks for spending the time and sharing on theCUBE. >> All right, a pleasure. Always great to see you guys. Live in San Francisco for Oracle OpenWorld. This is theCUBE. I'm John Furrier, Peter Burris, we'll be back with more after this short break.